Djula Borozan

Internal Migration, Regional Economic Convergence, and Growth in Croatia

The article aims to explore internal migration flows, test for economic convergence, and assess the effects of internal migration (net and gross) on convergence and growth in terms of a neoclassical model in Croatia in the period 2000 to 2011. Croatia is a country with significant and persistent regional economic disparities, migration, and turbulent economic and political changes. The main findings of panel data analysis with fixed effects show that (i) contrary to the expectations based on neoclassical theory, the Croatian counties have been facing absolute and conditional economic divergence; (ii) in- and out-migration works symmetrically; (iii) net migration mainly appears to be a force that accelerates divergence, just opposite to gross in- and out-migration; (iv) although the estimated parameters of net and gross migration have expected signs, their effect size lies in the range from statistically significant but minor to insignificant; and (v) migrant characteristics and behavior matter when the effect size is considered.

Granger causality and innovation accounting analysis of the monetary transmission mechanism in Croatia

This article explores the pass-through of different monetary policy channels to inflation in Croatia between January 1998 and December 2009. Using a four-step procedure: unit root test, co-integration test, Granger causality and innovation accounting techniques, we find that (i) interest rates, credits and the nominal exchange rate do not Granger-cause inflation individually; however, they do with nominal M1 money supply jointly at lag two; (ii) the nominal effective exchange rate is the most important pass-through to inflation statistically, accounting for approximately 11% of forecast error variance after four years; (iii) credits and nominal M1 have very small portions in explaining variations in the total variance of inflation; and (iv) the nominal interest rate is the weakest but statistically significant channel to inflation in the long run. These results are discussed within the Croatian monetary framework and future developments of monetary channels in Central and Eastern European countries.

Analyzing total-factor energy efficiency in Croatian counties: evidence from a non-parametric approach

Using energy efficiently has become top priority concern which requires an adequate policy reaction bearing in mind both energy conservation and efforts to combat adverse climate changes. The paper explored the total-factor energy efficiency and change trends in technical efficiency in the Croatian counties during the period 2001–2013. Employing data envelopment analysis, the overall technical, pure technical and scale efficiency are assessed. Considering the empirical results, we have concluded the following. Technical inefficiency is generated almost equally by the pure technical effect and an incorrect production scale. The overall geographical distribution of the technical efficiency scores points to the presence of spatial concentration, i.e., a dualistic pattern (centre vs. periphery) in the production process. The differences between the best practice and the worst technical efficiency scores indicate the presence of significant disparities among Croatian counties. The years with deteriorating electricity efficiency seem to coincide with the important economic/energy changes that happened in Croatia. Finally, subnational governments may play an important role in energy efficiency policies.

Social capital in Croatia: measurement and regional distribution

By using partial least squares path modeling, this paper develops a complex index of social capital, selects Croatia as the case for testing and validating the index, and investigates the regional distribution of social capital. The social capital index is defined as a complex hierarchical structured construct of third-order with social trust, participation, and civism as its core dimensions. The main results indicate that civism is the most important cause of social capital followed by active participation and social trust. As far as the regional distribution of social capital is concerned, there are statistically significant differences across the Croatian regions. Although the lowest or below the national average level of social capital and its dimensions can be mostly found in the least developed regions (with the exception of the capital), the highest level of social capital and its particular dimensions is not achieved in the most developed regions.

In Search of the New EU Energy Reforms: Assessing the Financial Performance of the EU Energy Companies

To unveil the challenges the European energy industry faces, this paper looks at the financial performance of energy companies that are different in terms of the energy generation mix in the period 2011–2013. Furthermore, the paper aims to draw general conclusions on how the share of conventional power plants in the companies’ generation mix has affected their operation as a whole. Finally, the paper discusses the trends in the energy industry, in particular regarding gas-fired power plants, as well the opportunities and threats facing them in the context of achieving the EU strategic energy goals. The results show that companies with a higher share of conventional thermal power plants in their energy mix operate with a significant decrease in profit, and generally face a decrease in their asset value. This is opposite to companies with large diversified portfolios and shares of hydropower and new renewables. Since conventional power plants, especially high-performing and flexible gas-fired cogeneration ones, may play a key role in producing the peak load and even the base load power, as well as in maintaining high quality in the electricity grid, this situation might jeopardize the achievement of the EU strategic energy goals. Hence, it calls for new energy reforms.