Issue 6, 2005

A simple model of the debt equilibrium under the conditions of a monetary board is developed. The model has three equations. The first one depicts the impact of the debt burden on the economic activity and the economic growth, respectively; the second one represents a relationship between the balance of payment deficit and the economic activity; the third one gives expression to a relationship between the debt burden and the balance of payment deficit. In order to make the system dynamic, it is required to take into account also of the structures of the state budget, but to the extent to which they are revenant to the foreign debt servicing.
The model of the debt equilibrium, developed in principle, is applied to evaluate in practice the status and level of the debt burden in Bulgaria. Results from model calculations for three countries - Macedonia, Turkey and Poland are also presented.
Findings show that taking into consideration the existing economic reality in Bulgaria in the beginning of the XXI century, the relative foreign debt reduction as an end in itself is not the best macroeconomic solution. Pursuing such a policy could impede the economic growth, which in turn would have a negative impact on the improvement of the international financial position of the country. Requirements come to the fore, that are related with the entire movement of the economy toward higher efficiency and this advance is also a pre-condition for a reduction in the relative debt burden.

Problems of the economic growth in Bulgaria, related to its acceleration, approximation to developed countries' level and raising in the living standard, are examined. Possibilities for solving these issues on the base of an investment policy are analysed. The policy should stimulate local and foreign investors and contribute to the development and effective use of endogenous growth factors.

Regional specialisation by processing industry sectors in Bulgaria is studied through calculating coefficients of absolute and relative specialisation. Cluster and discriminant analyses are applied. A relationship between processes observed in Bulgaria and other Central and Eastern European countries is searched. Findings show that the specialisation of the regions in Bulgaria is yet to begin. Formation of clusters according to the specialisation process is also forthcoming. In the course of development of integration processes, Bulgaria will experience difficulties when entering the open European market and this will deepen the regional specialsation, predominantly in the field of labour-intensive branches with low capital-intensity.

This paper is an attempt to introduce the essence and methodology of Artificial Neural Networks (ANN) in marketing. In order to outline the benefits of their analytical application in marketing management, it is demonstrated how to solve a predictive problem applying one of the most widely used types of ANN - Multi-Layered Feedforward Neural Network. Sales history data about four brands from the Fast Moving Consumer Goods sector in Bulgaria are used for the analysis. Time series are examined for presence of sparsity, outliers and nonstationarity, because these data characteristics can have a significant effect on the accuracy of predictions. It has been proven that ANN gives more accurate predictions in comparison with traditional methods, such as ARIMA and Exponential Smoothing.