Issue 1, 2015

There is a growing concern about the future of the European Monetary Union (EMU) and the sustainability of the Euro. The worst case scenario: the break-up of the Single currency would not remain limited to the EMU itself, but would cause huge macroeconomic disruptions. Furthermore, if the countries reintroduce their national currencies, economically stronger countries will experience domestic currency appreciation towards the weaker economic counties. That would mean reduction of their exports, i.e. reduction of the price competitiveness. In such a situation, in order to protect their domestic economies, the countries will introduce protectionist measures which would suspend the Single market. Without the free movement of factors of production it is impossible for the Union to survive. This means that if the Eurozone falls apart, there will be a complete end to the Union. Returning back to the stages of regional integration as common market or customs union is theoretically impossible. Still, in any possible scenarios for how the Euro crisis might develop would adversely affect the Single market. Solving the macroeconomic imbalance of the Union will be a condition for its sustainability in the future and for insuring better future prospects of the Single Market.
JEL: F15; F62

This paper reveals key challenges to monetary and fiscal policy in the Eurozone and Bulgaria. For the Eurozone they are primarily linked to: the active, stimulating fiscal and monetary policy before and during the crisis; the high levels of budget deficits and increasing sovereign debt in the context of fragile economic growth, high unemployment, deflation. In Bulgaria, in the framework of Currency Board the political risk and the risk of devaluation pose challenges to the monetary and fiscal policy. It is likely that upon joining the Eurozone governments are tempted to increase budget deficit and public debt because the commitment to full coverage of monetary base with foreign reserves will not exist anymore as well as they may use the opportunity to raise the deficit to 3% of GDP (or even more).
JEL: E62; E52; H63; H61; G01

The research paper presents analysis of policies and problems in Estonia, Latvia and Lithuania on their way to the European monetary union. At the beginning of the 1990s the Baltic countries and Bulgaria have similar problems and economic indicators and they embark on their way to establishing a market economy infrastructure in economic and political chaos. In the middle of the second decade of the 21^st century the differences are substantial. The marked out route to the monetary union contains important lessons and the most significant economic comparisons for Bulgaria. The success of the Baltic countries is determined by the strategic choices made in the beginning of the 1990s and the remarkable perseverance based on political will for tough but unavoidable reforms and achieving real convergence as members of a union with developed European countries.
JEL: E60; F45; H12

The paper focuses on the trends of the functioning of the capital market in Greece and how these trends reflect on the efforts for solving the crisis of the Greek economy. It analyzes multiple data describing the institutional development of the capital market, as well as its trade dynamics – price, trade volumes, capitalization, capital acquiring, for the period 1991-2014. The paper makes comparisons with other developed and developing markets.
The analysis shows that after the boom of the state debt crisis the market looses the specifics of a developed market and has a disturbed functionality – it does not provide a serious alternative for saving and investing, as well as opportunities for acquiring capital. All this obstructs the financing of the firms, respectively the investments, as well as the restoring of the consumption and the economy as a whole.
JEL: G01; G15; G23

Underground economy, is all countries economy reality and forms a percent of each country`s economy and is the cause of many social and economic disorders that presents its existence in community with an unseen hand  and is the cause of monetary and financial problems emergence and obscures economic data and makes inappropriate performance of economic policy therefore, due to the sensitivity of this phenomenon, this research measure the volume of smuggled goods during the years of (1974-2011) based on Lisrel software. In this study, for determining the size of the underground economy, firstly, its index has been determined by using MIMIC method in a ranked series of numbers and then for the sake of comparing different years, calibration and the previous studies were used to estimate the volume of relative and absolute underground economy. Based on mimic method, the average size of the underground economy during (1974-2011), was about 21% of official GDP. The results of this study show that the openness of the economy, inflation, education and the size of the government are considered main causes of the underground economy in Iran. The average size of the underground economy in past studies, was about 19% of GDP but in this study, it`s two percent higher than the average of the whole period.
JEL: C22; E26; C51; H26

This study covers the main advantages of cointegration approach to study the relationship between the statistical time series. Considered are the basic procedures for testing the order of integration of processes and their cointegration. There is a study of software procedures of cointegration approach. It provides a summary of the development of the theory of cointegration and methods of testing and an experiment with empirical data to compare the results of the procedures with and without taking account of structural breaks in the data.
JEL: C01; C51; F14

Here are presented the results from testing the impact of time on the state of components of consumers’ market demand of foods and soft drinks in case of unchangeable income of the total consumer. Some regularities are pointed out in the changed quantities of the consumed products, of the expenses made for them, of their prises, of the consumed food energy and its components. These results are compared with the results from research of the opposite regime: by changeable income and without accounting time and a regime with accounting the impact and changes of income and time.
JEL: D12; Q11

In the last decade, new economic phenomena have emerged and their implications regarding consumer wellbeing need a thorough analysis. Synthesizing statistics in the European Union, it revealed a tendency in recent years of increasing the number of notifications on products that pose safety or security risks to consumers as well as a rising number of buyers resorting to online shopping. Utilizing new data collected through the statistical survey research method, the paper represents a study on the complaining behaviour of Romanians who opt to purchase products from online stores, as members or the European Union, their consumer safety regarding online shopping and the degree to which they are properly informed and know their rights. The results showed that Romanian consumers are circumspect about purchasing products online. However, they tend to be occasional buyers and they are reluctant regarding registering complaints concerning noncompliant products purchased online due. The paper provides an original study on complaining behaviour and consumer safety in Romania regarding products purchased from the internet and the identified solutions can lead to an improvement of consumer protection in the online environment.
JEL:  D12; D18