Issue 7, 2008

Theoretical foundation of the convergence concept in neo-classical growth model has been analysed. According to that concept, the income per capita growth tends to grow in reverse correlation of income initial level. In fact, however, there is obviously an outspoken lack of convergence in standards of living between developed and less developed countries. The new (endogenous) growth theories offer possible explanations for the observed lack of convergence between rich and poor countries.
An empirical study is presented, reviewing 42 countries in the world (including 30 developed and 12 less developed countries) over the period 1900-2005 as well as by divided sub-periods. Special attention is paid to the convergence among EU member states by GDP by per capita in a historical retrospective.
JEL: C2; E13; F43; O12

This article presents Bulgarian economy situation by 2008, analysed in terms of some evolving inner tensions and disbalances. The individual elements' dynamics of GDP is traced in the first part, illustrating how the economic expansion of the last decade is to be attributed to the imports of goods and services. GDP growth is predetermined by domestic demand. A steady overtaking growth at a sectorial level is recorded by an element called "adjustments" which is filled by indirect taxation. The fastest growth in the sector of industry is due to construction whereas in the services sector - to financial mediation. Such a discordance could not continue in the future, so structural adjustments linked to the overall tuning of the economy, are both possible and probable. The second part of the article studies the changes in inflation rates, employment and income. A clear positive trend of inflationary pressures emerges, which is in line with the positive development of real income of households per capita. Material and financial resources are tied up in unproductive projects which pushes domestic demand further but the latter is not met structurally by a corresponding supply. The subject of the third part is financial mediation. The lending provided by the banking system is still being held at an unreasonably high level which does not correspond to the structural characteristics of demand. In the end some conclusions are drawn for the inner structural tensions building up in the economy, accompanied by intensifying disequilibrium. There has been made an attempt to formulate adequate macroeconomic management policies with a view to preventing serious economic and financial failures from happening as a result of the overheated to a certain extent Bulgarian economy.
JEL: С82; Е01; Е27

The management process is not aimless. It is directed towards the object of management for the achievement of certain goals. Various reasons are possible as well as the influence of various factors leading to deviation from the set goals. Thus, they can be achieved or only partially fulfilled and even if their achievement is ensured it has to be at the expense of the accelerated exhaustion of resource potential. The possible deviations from the goals are always accompanied by specific problems. Generally they can be defined as problems that emerge ad hoc and are active for a short period and problems that act for a longer periods of time. The latter are related to the chronic management deficiency (CMD). However, this does not mean that the former could not be transformed into long-term if not resolved in time and completely.
JEL: D23; M11; M12

In the late 40-ies of XX c., Claude Shannon developed the formula for the information unit, the bit. Since then, the problem concerning the informative essence of the economic processes and the phenomena in general initiated a new direction in science. However, the information theory has still remained undeveloped. The current article makes a modest attempt to make clarifications about the said theoretical direction.
JEL: В22; В41

The "New world order" (declared by George Bush Senior and the Club of Rome in the end of 20th century) is not a novice concept but is deeply rooted in history. New, however, are the unique circumstances under which it is constructed: wide-range and dynamic liberal globalization, collapse (in 1989) of the two-polarities world with two main leaders and the reign of a single super-powerful hegemony (USA) but with emerging new rivals (separate states or coalitions); growing role and importance of regional economic formations (with the EU as a prototype) and global corporations in the context of growing and intensifying environmental and cultural crisis; the economic (crisis) regularly reminds if itself too ... The discrepancy and/or disparity between the emerging liberal global society and the lack of global governance is intensifying well, being expected to overcome the "new world order".
JEL: F01; F02

Examined are the changes that will occur in the probability of use of possible grants after direct payments for a unit of area in agriculture are available. Related to this is examined the dependence between the sought possibility and the economic size of farms trough logistical statistical modeling. On the ground of the created logistical models are drawn up plans on the expected use of grants generally to secure of means of circulation and main means of production as well as only to use them in long-term investment. Some important conclusions are made about the future behavior of farmers from the point of view of their investment activity. The more favorable structure of farms after receiving of the payments for a unit of area is the main reason for the expected bigger size of the examined possibility.
JEL: С20; Q14

A model for measurement and analysis of population ageing has been developed. The already published various methods are synthesized in a complex model for measurement and factor analysis of ageing. The novice here is the further development of factor model. In that method a hipothetical population with preserved intensities of the three processes - age-specific fertility rates of women, mortality and net migration by sex and age from a previous period - is established. At these conditions two tasks of factor analysis are solved. In the first one, ageing is divided in two parts - by the three processes' preserved intensities and by their changes in surveyed period. In the second task ageing is subdivided in three parts - by change in the number of live births and by the different intensities of mortality and net migration by age in accounted period. An analysis of the persistent population ageing in Bulgaria in 1990-2000 has been conducted.
JEL: J 11

In some of the cases when statistical methods of research on inter-relationships and interdependencies are applied to distributions different from the normal, the results can be disputed. One of the reasons is that the construction of these methods is based only on the first moment, the second central and mixed moments. The measures based on moments of higher order, such as the estimators for asymmetry and excess, are usually ignored despite the fact that they carry information which very often is extremely valuable. The article presents an idea for the simultaneous use of the moments from the first to the fourth order - the mean, standard deviation, and the asymmetry and excess coefficients for comparing several distributions to the same moment and for investigating the dynamics of distributions.
JEL: C10, C46, G11, J10, J13

Examined are the main factors influencing the increased demand for residential property as a main accelerator of the price increase. Special attention is focused on the significant increase of residential mortgage credits due to the more advantageous loan conditions and the improved acquittal capacity of households. Of great significance is the sharply increasing during the last years external demand for residences as an engine of the estate market. Analyzed are the perspectives for the development of the estate market and the factors for a future containment and eventual decrease of prices of real estates in Bulgaria.
JEL: G21; R21; R31

On 3 July, 2008, it is one year since the death of the esteemed Bulgarian scientist Professor, Dr. Ec. Scs. Alexander Dimitrov, a former Director of the Institute of Economics at the Bulgarian Academy of Sciences and Editor- in-Chief of the "Economic Thought" magazine, one of the fellow colleagues who contributed largely to the contemporary development of the economic science in our country. Prof. Alexander Dimitrov was born on 3 August 1935 in Sofia. He had two University decrees - in Statistics from Karl Marx Higher Institute of Economics (University of National and World Economy at present) and in Econometrics from the Institute of Economic Research in Belgrade. He earned the scientific degrees "Doctor of economics" and "Doctor of economic sciences". He was recognized and well known scientist in the field of Econometrics, Economic growth and International economics both in Bulgarian and abroad. He wrote over 120 publications, of which 11 were published in English in Tokyo, Bucharest, Luxembourg, Moscow and Podgorica. He was an author of a textbook in Econometrics in Bulgaria that has already been published several times.