Notitia - journal for sustainable development

4

Authors: Tihana Škrinjarić

Book review

10

Authors: Vedran Šupuković, Sanel Jakupović, Ibrahim Obhođaš

The issue of management process in all organizations with a pronounced hierarchical structure is extremely complex and equally abstract to both the participants themselves and all those who deal with the study of this topic. The management process involves decision-making based on appropriate economic analysis, experience, practice, micro and macro environment, and the ability of an individual manager to create a symbiosis based on all the knowledge that will ultimately lead to making an appropriate business decision. The aim of this paper is to build a presentation of the model, which in this case will improve the economic community and enrich the everyday work of companies. This will allow the ownership and management structures of a large number of inadequately structured and internally non-institutionalized companies to become active and passive managers of all business relations within the companies in which they operate, instead of active or passive observers. In this paper, a management model will be presented based on the data researched within five variables: quality of human resources, economic incentives, development perspectives, managerial capabilities of subordinates and business satisfaction. One of the aims of this paper is precisely to explore how these variables influence the business satisfaction of Croatian companies. The research was conducted in the territory of the Republic of Croatia, in all regions, on a representative sample, while representatives of the companies were surveyed. The answers obtained were analysed descriptively, through the regression model. It has been proven that the greatest influence on pleasure in business is influenced by managerial capacities, where beta coefficients is 0.367. Slightly less impact on the pleasure of doing business has the development of enterprises and incentives from the budget, while the smallest impact on the pleasure of doing business has human potential. The obtained beta COTA is statistically significant because the p – value < 0.05, in all four cases. The scientific contributions of this paper are reflected in a model that will serve to measure the impact of manager satisfaction on the basis of quantitative parameters and as an example of a universal model of manager satisfaction assessment.

17

Authors: Siniša Bogdan, Suzana Bareša, Velimir Hađina

Altmanov Z-score jedan je od najpoznatijih modela za predviđanje poslovnih poteškoća odnosno stečaja. Cilj ovog rada je testirati Altmanov Z-score model i utvrditi u kojoj je mjeri primjenjiv u predviđanju stečaja u Republici Hrvatskoj. Testirani ukupni uzorak sa Zagrebačke burze sastojao se od 52 poslovna subjekta, od čega 26 koji su otvorili stečaj i 26 sa stabilnim poslovanjem, te je isti promatran u ukupnom vremenskom razdoblju 2007.–2016. Budući da se testirani uzorak sastojao i od poslovnih subjekata koji ne pripadaju proizvodnom sektoru, u istraživanju je korišten Altmanov revidirani Z''-score model. Osim testiranja uspješnosti istog, u radu su se nastojali prilagoditi ponderi Z''-score modela primjenom višestruke diskriminantne analize u cilju dobivanja modela koji će biti prilagođeniji hrvatskom tržištu. Radi prisutnosti multikolinearnosti nisu sve varijable zadržane u modelu, te je dobiven model koji ima slabiju uspješnosti od Z''-score modela. Rezultati ovog istraživanja ukazuju da je Altmanov Z''-score primjenjiv na hrvatskom tržištu, ali se preporuča koristiti ga kao dodatni, a nikako kao osnovni pokazatelj za predviđanje stečaja.

19

Authors: Zlatko Čehulić, Rajka Hrbić

In this paper the impact of adopting the euro in Croatia is analysed using experiences of other countries which have passed through this process in the last decade and which are comparable with Croatia in many aspects. The process of adopting a currency different from the one that has been used for more than twenty years presents a very important economic question for each country. In this period preceding to adopting the euro, there is an opportunity to analyse this process in the countries which went through it in the past. The result of this paper shows the impacts of adopting the euro in the European countries. The selected countries, which are adequate for analysing the effects of adopting the euro, are: Portugal, Ireland, Greece, Spain, Slovenia, Slovakia, Estonia, Lithuania and Latvia. These countries have been selected for different reasons. The majority of these countries have some similarities with Croatia, which are shown in this paper via relevant economic indicators. These results are significant for Croatia and show a positive influence on the Croatian market on a long-term basis. This paper is relevant and has a practical basis both for Croatia and other countries which will go through this process in the future.

20

Authors: Ružica Brečić, Hrvoje Bradica, Mihovil Anđelinović

Ciljevi rada su utvrditi dimenzije i analizirati stupanj razvoja društveno odgovornog marketinga (DOM-a) malih i srednjih poduzeća (MSP-a) u Hrvatskoj te ispitati čimbenike koji utječu na vlasnike/menadžere MSP-a prilikom primjene DOM-a. Primijenjeno je kvalitativno istraživanje putem dubinskih intervjua (n=16), analize bilješki s terena, internetskih stranica poduzeća te izvješća poduzeća vezanim uz DOM. Rezultati istraživanja su pokazali kako su vlasnici/menadžeri MSP-a u RH većinom upoznati s pojmom i definicijom DOM-a, ali kako je primjena takvog poslovanja još u začecima. DOM-a je u najvećoj mjeri usmjeren prema potrošačima, zaposlenicima i lokalnoj zajednici, dok se ostale interesno-utjecajne skupine (dobavljači, konkurencija, okoliš, vladine organizacije i mediji) spominju tek od strane nekoliko ispitanika. MSP-a se međusobno razlikuju prema stupnju razvoja društveno odgovornog marketinga i dijele se u tri skupine: poduzeća koja minimalno odgovaraju principima DOM-a, poduzeća koja imaju poseban tim unutar svoje organizacije zadužen za smišljanje i provedbu takvih aktivnosti te poduzeća koja su svoje djelovanje utemeljila na principima održivosti i slijede ih u svakoj svojoj odluci i akciji.

8

Authors: Branimir Skoko; Pero Zovko

The aim of this research is to examine the sustainability of international trade flows of Bosnia and Herzegovina with the rest of the world. The data sample consists of quarterly data from the first quarter of 2008 to the last quarter of 2016. Johansen tests of cointegration indicated that exports and imports are co-integrated in the case of Bosnia and Herzegovina and Vector Error Correction Model (VECM) is estimated and tested. Research results revealed a bidirectional weakly sustainable relationship between exports and imports pointing out the need to improve external competitiveness of Bosnia and Herzegovina’s economy

14

Authors: Maja Mihelja Žaja; Saša Jakšić; Karlo Špoljar

Students enter the labour market through a Student Service to have the opportunity to pay for tuition fees or to earn additional income that would allow for the parents or guardian's budget to be disbursed. Although almost 70% of full-time students were working through a student contract in 2016, the Regulation on intermediaries for employment of full-time students from 1996 was the only legal document that was regulating student employment. Due to improperness of this document and the fact that student employment is not under the Labour Law, in November 2017 the Croatian Government published a proposal for the new Student Employment Act, which was passed in November 2018. Subsequently, the reform of regulatory framework of student employment is important to student work force. According to the Regulation in force, there is no constraint on the maximum weekly working hours or maximum annual earnings. Nevertheless, student income can become taxable under the rules of Personal Income Tax Law if it exceeds the annual limit of 60,600.00 HRK. Consequently, the reform of personal income tax is also significant for students if they do not want to become a taxpayer of personal income tax. Based on this, the main goal of this paper is to analyse attitudes of students towards the regulatory framework of student employment, reform of personal income tax and their work under the mediation of the Student Centre. In order to question student attitudes, the questionnaire was used and the results of the analysis carried out before changes in legislation, in February and March 2018, indicate that students were not satisfied with the existing regulatory framework and the personal income tax reform, and that they expect the improvement of working conditions with the implementation of the new Student Employment Act.

9

Authors: Mirjana Landika; Sanel Jakupović; Vedran Šupuković

Investment policy and investing represent essential tasks, and also major issues of almost all socio-economic systems. Investment represents a development platform and is necessary for survival of market and economic systems; it comprises undertaking appropriate measures and activities to have the invested capital continuously increasing through exercising selected operations. Economic indicators, especially in the period of economic crisis, reflect unfavourable and widespread tendencies of unwanted business result that arise from inadequate business policy, where investing and investment policy may be marked as leaders in the area of business failure. Impossibility to accurately assume business results related to the investment, time disproportion between the investment and its initial, and particularly, optimal effects, and also irreversibility of the investment, further complicate the formulation of adequate investment policy strategy platform. Modelling of business strategies in the exposure to turbulent socio-economic, technological and market factors is an inspiration and a challenge to the researcher to representatively mirror the reality by selecting an adequate theoretical model. Faithful mirroring of the reality involves a subtle approach to classification of these factors by importance, level of influence, and also adequate quantifying, identifying and shaping the form, as well as the extent of their interdependence. Mathematical simulation model is a theoretical model that allows prediction of business results in the risk exposure expressed correspondently with the random component that is influencing it. The major concern of the mentioned approach is an adequate selection of the probability distribution of a random variable, customized to the investment conditions. It is necessary here to take into account empiric component of a territorial-geographic area of the investment implementation, whereby it is necessary to have insight into other aspects of distribution selection, such as experiences in the selected investment area (sectoral specificity) and adjustment to particular theoretical model. Simulation of investment effects provides an objective approach to strategic choice and adequate calculation of monetary results before operationalization of the project.

10

Authors: Sanja Franc; Velibor Peulić

The main aim of this research is to examine Slovenian trade flows in goods and services with the rest of the world since joining the European Union (EU) in May 2004. We applied Granger causality test and Vector Error Correction Model (VECM) on quarterly data from the first quarter of 2005 up to the first quarter of 2017. Applied Hansen and Seo (2002) test confirmed the assumption of linearity in the relationship between the variables under consideration and therefore the appropriateness of the empirical approach for the purpose of this paper. The research results indicate importing to exporting as a dominant trade pattern in the Slovenian economy and successful trade balance with the rest of the world since Slovenia joined the EU.

13

Authors: Marija Beg; Domenika Mergl

In the public discourse of transition economies, as well as in scientific literature focused on their functioning, there is still an active debate on whether privatization should be encouraged in view of its effects on the economy. In the context of the effects of privatization on employment, this paper focuses on labor market developments in Croatia. The primary emphasis is on the analysis of employment by activity and ownership type. The main aim of the paper is to determine the impact of privatization, i.e. the growing share of private ownership, on employment in Croatia. The estimate is conducted using the OLS method in the EViews statistical package. The results of the econometric analysis indicate that the increase in the share of private property leads to an increase in employment. In view of the results obtained it is recommended to further reduce the high share of state ownership in the Republic of Croatia.

13

Authors: Hrvoje Jošić; Fran Maček Pandak

Ever since its independence, Venezuela has based its economy on the manufacturing and export of a single product. In the 19th century, those products were cocoa and coffee beans, which were replaced by oil in the 20th century. This led to the Dutch disease which harmed other sectors of the economy, so the often corrupt governments bought social peace with socialist policies and government spending. During the 1980s, the first significant plunge in oil prices in the 20th century forced the Venezuelan government to conduct liberal reforms in order to receive assistance from the International Monetary Fund. These led to a significant decline in the standard of living and GDP, as well as, mass protests. Due to the popular discontent, the 1998 presidential elections were won by Hugo Chavez, a former military officer and the leader of the failed coup, who used the rebound in oil prices to start socialist reforms and economic recovery. Expropriations of privately owned assets and price controls weakened the domestic economy and led to inflation, while the rise in government spending strained the public finances. The big drop in oil price in 2014 caused the collapse of the Venezuelan economy as well as social and political crisis. The data used in making this paper is from the Venezuelan government and its departments and institutes, as well as from the United Nations, the World Bank, other organisations and Venezuelan and foreign newspapers and web portals.

18

Authors: Martina Sopta; Lucija Šola

The topic of the paper is of a high importance and interest for Croatia since it covers the sector which provides many jobs in professions with a shortage of workers. Besides historical and comparative methods, theoretical methods such as analysis, synthesis, induction and deduction were also used in this research. The main objective was to describe and explain the way the Export Credit Insurance division of Croatian Bank for Reconstruction and Development (HBOR) has contributed to the Croatian shipbuilding industry's recovery through managerial aspect. Analysis of the shipbuilding managerial economics in the scope of national economy reveals different models of government influence on recovery of the industry: financial support, restructuring, privatization, and export credit insurance. Considering a high degree of risk present in export, export credit insurance has a major impact on the domestic shipbuilding recovery. The main goal of export credit insurance is to increase the competitiveness of Croatian shipyards abroad.

7

Authors: Igor Živko; Mile Bošnjak

Debt-based financial instruments are specific due to the maturity component and conventional approaches in estimating their volatility may not be applicable. This paper focuses on modeling and forecasting price volatility of sovereign debt instruments while taking into account their maturity. In doing so we propose a simple and useful technique for obtaining the desired confidence of volatility estimates. The proposed approach provides price volatility estimates for debt instruments issued by Croatian government denominated in HRK and in EUR.

12

Authors: Mihovil Anđelinović; Petar Mišević; Ana Pavković

The paper analyzes determinants of demand for life insurance products in thirteen countries of the European Union. The expected demand determinants cover sixteen factors divided into macroeconomic, demographic, social and institutional variables. The main aim of the paper is to identify the variables that best explain variations in demand for life insurance and to draw a conclusion as to whether policy makers can contribute to the development of the life insurance market. For this purpose, an unbalanced panel model with a fixed effect for the period from 1995 to 2014 was estimated. The most important variables were macroeconomic ones, especially gross domestic product per capita. Insurance companies need to take into account demographic trends and existing economic situations in the respective economies when developing their products, and as analysis indicates, they have to make efforts in educating the population concerning the benefits of life insurance and the need for long-term savings.

13

Authors: Sanja Franc; Maja Kušćer

Free trade is an important factor in economic development and the creation of new jobs. Transatlantic relations and trade have a global impact, and their significance has increased after the establishment of the European Community. The EU and the United States have been undergone different development models and phases which have in turn determined the nature of their cooperation. The aim of this paper is to give an overview of key features of the new Transatlantic Trade and Investment Partnership and its potential impact on members, as well as on the third countries. The expected effects are not equal or evenly distributed and will depend upon the type of goods exchanged, regulation divergence and the overall scope of the agreement. The conclusion is that the elimination of tariff barriers will not have the same significant effects as elimination or reduction of non-tariff barriers on trade and investments.

6

Authors: Danijela Ćenan

This article provides an overview of the Renewable Energy Sources and High-Efficiency Cogeneration Act and its expected implication for project development, power plant construction and electricity production from renewable energy sources and high-efficiency cogeneration in the Republic of Croatia. The Act was adopted by the Croatian Parliament at its session held on 3 September 2015. Through the adoption of this Act, the production and use of electricity from renewable energy sources such as the renewables support scheme have been regulated for the first time by a special Act.

12

Authors: Hrvoje Jošić; Petar Mezga

The subject of the paper is the importance of the dollar as a world currency. The paper analyzes how the dollar became a world currency, the implications of its role as a world currency in the economy of the United States and other countries, and how various changes in the world economy (the global financial crisis that began in 2007, the emergence and growing importance of the euro, and the potential growth of the yuan) affect the status of the dollar as a world currency. In accordance with the topic of the paper, the historical context or environment in which the dollar has emerged as the leading world currency is analysed, along with the economic context in which the phenomena prominently connects this world currency issuer with the economy of the country and its impact on other countries. The impact of the global financial crisis on the dollar, its current status and future perspectives are also analyzed. Accelerated growth in developing countries and the increase in the importance of the euro and the yuan in international payments represent challenges to the dollar in the near future, when it is expected that a system will develop using several world currencies, instead of one dominant world currency.

13

Authors: Iva Čondić-Jurkić

Crowdfunding is an alternative source of financing by which a large number of people use online platforms to make small contributions to a cause. Crowdfunding can take place either through investment-based platforms, or through reward-based and donation-based platforms. The choice of platform by a supporter of a campaign reflects their motive for participating in crowdfunding financing. Participation can be either intrinsically driven, when the supporter requires no monetary compensaton, but enjoys helping others, or extrinsically driven, when the supporter expects potential financial returns. In addition to the main aspects of the crowdfunding market, this paper aims to analyze the potential challenges and risks faced by the crowd. A high-quality regulatory environment would help mitigate these risks.

15

Authors: Tajana Barbić

This paper summarizes modern aspects of the capital market environment. The aim is to provide an extensive overview of theoretical and empirical studies which analyse changes in the ownership and demutualisation of stock exchanges, ongoing technological innovations, initiatives for changing and eliminating regulation, and increase in competition. For this purpose, the author employs deductive-logical methodology, compilation, synthesis and classification. An analysis of the relevant research showed that transformation of ownership was one of the key drivers of the capital market environment, changing stock markets from monopolies to competitive companies. Technological innovations changed trading platforms and overcame geographical distances, eased communication and cut transaction costs, which encouraged the development of competition overall. Competitive forces have also been spurred by changes in regulation, in particular by deregulation, self-regulation and, in the case of EU capital markets, harmonisation of regulation. The results of the research showed that these modern aspects of capital markets have led to significant changes in the industry, and directed capital markets towards overseas mergers and cooperation.

15

Authors: Elizabeta Mađarević

The paper explains the implications of the European refugee crisis for the functioning of the EU and democracy within Europe, with reference to Hannah Arendt's theory on refugees and human rights. The paper examines critically the handling of the refugee crisis by the European Commission and its attitude towards EU Member States, which compromises the actual functioning of the EU and democracy in Europe. Arendt's theory helps us understand better the present situation, taking into account the historical context. Her theory on human rights, born of the French Revolution provides a possible answer regarding how to preserve European nation-states and democracy in Europe, notions that have been challenged seriously by the waves of refugees from the Middle East, and ultimately by the European Union itself.

17

Authors: Sanja Franc

The aim of this paper is to analyze how foreign direct investment can impact sustainable development, particularly from an environmental standpoint. Pursuing that aim, the structure and flows of foreign direct investment are analyzed, along with environmental protection regulation and its evolution over the last few decades in European Union (EU) countries. The conclusion of the research is that most EU countries have strong environmental requirements that can influence investors seeking pollution havens in these countries. However, while common EU policies are in place, member countries also apply their own national regulations and incentives. Different approaches to investments and sustainable development policies may have implications for the level of harmonization and collaboration among EU countries in the future.