Selected Characteristics of Business Environment in Visegrad Region

Michaela Bruothová

Abstract

Business environment is considered to be an important factor that affects the competitiveness of the country or region. The assessment of business environment is subject to analysis realized by many national as well as internationally accepted institutions, whose outputs have usually form of composite indices reflecting the quality of the business environment. The aim of the article is to investigate the relationship between different indices of the quality of business environment on one side and selected macroeconomic indicators and country's credit rating on the other side. The analysis concentrates on the countries of Visegrad four region (V4) – Slovakia, Czech Republic, Hungary and Poland. The following indices are analyzed: Ease of Doing Business created by the World Bank Group , Global Competitiveness Index, Index of Economic Freedom, rating from The World Competitiveness Yearbook and Fragile State Index. We use the real gross domestic product, unemployment rate and inflation rate as the macroeconomic indicators and the results of the country's credit rating evaluated by Moody's, Standard & Poor's and Fitch Ratings. The analysis is based on the country level data for the 2005 – 2014 period derived from the official statistical reports of World Bank, World Economic Forum, Institute for Management Development, The Heritage Foundation, Fund for Peace and Eurostat. The analysis is performed through correlation analysis using Pearson as well as Spearman correlation coefficients. The results of our analysis indicate that relationship between different indices of the quality of business environment and selected macroeconomic indicators or country's credit rating is country specific.

Keywords

business conditions, quality of business environment, macroeconomic indicators, country's credit rating, V4 countries

Full Text:

References

Show references Hide references

Besley, T. (2015). Law, Regulation, and the Business Climate: The Nature and influence of the World Bank Doing Business Project, Journal of Economic Perspectives, 29 (3), pp. 99-120. DOI: 10.1257/jep.29.3.99

Bittlingmayer, G., Eathington, L., Hall, A. P. (2005). Business climate Indexes: Which Work, Which Don’t, and What Can They Say About the Kansas Economy?, Research Report, Kansas, Inc., Topeka, K.S.

Bobenič Hintošová, A., Hliboká, L. (2015). The relationship between Industry Structure and International Competitiveness: Evidence from a Small Open Economy, Journal of Applied Economic Sciences, 10 (5), pp. 710-715.

Campbell, N., Rodgers, T. (2007). Economic Freedom and Net Business Formation, Cato Journal, 27, pp. 23-36

Campbell, N., Rodgers, T., Heriot, K. (2007-08). The Economic Freedom Index as a Determinant of Firm Births and Firm Deaths, Southwest Business and Economic Journal, 16, pp. 37-50

Commander, S., Svejnar, J. (2011). Business Environment Exports, Ownership, and Firm Performance, Review of Economic and Statistics, 93 (1), pp. 309-337. DOI: 10.1162/REST_a_00135

Demjanová, L. (2009), Podnikateľské prostredie ako faktor konkurencieschopnosti v krajinách V4 v rokoch 2005-2009. Zborník príspevkov z medzinárodnej vedeckej konferencie Semafor ʼ09. pp. 58-66

Djankov, S., McLiesh, C., Ramalho, R. M. (2006). Regulation and Growth, Economic Letters, 92 (3), pp. 395-401

Erickson, R. (1987). Business Climate Studies: A Critical Evaluation, Economic Development Quarterly, 1, pp. 62-71. DOI: 10.1177/089124248700100108

Garrett, T., Rhine, R. 2010. Economic Freedom and Employment Growth in U.S. States, Working Paper, 006A, Federal Reserve Bank of St. Louis, MO

Gillanders, R., Whelan K. 2014, Open for Business? Institutions, Business Environment and Economic crisis, 67 (4), pp. 535-558

Hall, J., Sobel, R. (2008), Institutions, Entrepreneurship, and Regional Differences in economic Growth, Southern Journal of Entrepreneurship, 1, pp. 66-96

Institute for Management Development. (2015). Methodology. Available at: http://www.imd.org/wcc/research-methodology/. Accessed 19 November 2015

Kolko, J., Neumark, D., Mejia, M. C. (2013). What Do Business Climate Indexes Teach Us about State Policy and economic Growth, Journal of Regional Science, 53 (2), pp. 220-255. DOI: 10.1111/j.1467-9787.2012.00782.x

Körner, P., Kudrna, Z., Vychodil, O. (2002). Měření kvality podnikatelského prostředí ve střední Evropě, Finance a úvěr, 12, pp. 674-697

Oztur, H. (2014). The Origin of Bias in Sovereign Credit Ratings: Reconciling Agency Views with Institutional Quality. Journal of Developing Areas, 4 (48). pp. 161-188

Spišáková, E., Pétrová, R. (2011). Vplyv hospodárskej krízy na vybrané makroekonomické ukazovatele, Transfer inovácií, 21, pp. 240-248

The Fund for Peace. (2014). Fragile State Index 2014. Available at: http://library.fundforpeace.org/library/cfsir1423-fragilestatesindex2014-06d.pdf. Accessed 19 November 2015

The Heritage Foundation. (2015). About the Index. Available at: http://www.heritage.org/index/about. Accessed 19 November 2015

The World Bank. (2010). Doing Business 2010. Available at: http://www.doingbusiness.org/~/media/GIAWB/Doing%20Business/Documents/Annual-Reports/English/DB10-FullReport.pdf. Accessed 19 November 2015

Van Metre, B. J., Hall, J (2011). How Friendly To Entrepreneurs Are “Business friendly” Policies?, Journal Business and Economic Perspectives, 28 (1), pp. 105-116

Witkowska, J. (2007). Foreign Direct Investment in the Changing Business Environment of the European’s New Member states, Global Economy Journal, 7 (4), pp. 1-30. DOI: 10.2202/1524-5861.1233

World Economic Forum. (2012). The Global Competitiveness Report 2011-2012. Available at: http://www3.weforum.org/docs/WEF_GCR_Report_2011-12.pdf. Accessed 19 November 2015

https://doi.org/10.5817/CEJM2016-1-3


Copyright (c) 2017 Michaela Bruothová

Creative Commons License
This work is licensed under a Creative Commons Attribution 4.0 International License.