Poland Business Cycle Composition

Summary

The us Focus examines and interprets the statistical characteristics in the Polish organization cycle. It also identifies leading and lagging variables and shows that the economic variances in Especially differ to some degree from individuals in other growing and fully developed economies, with Polish progress notably even more volatile and government expenses highly unpredictable.

The readily available data on GDP development suggest that the Polish economy is getting close the peak of the second business cycle since the start of economic alteration from a centrally organized to a market economy. The present upswing is always to some extent like the one of 1995-1997 which resulted in large macroeconomic imbalances (increasing unemployment, extra capacity, widening fiscal and current account deficits). However , Poland now appears to be better located than after the last pattern and should be able to avoid a repeat of the outcome. Organization cycles in emerging market economies

Even though the economic books on organization cycles is definitely vast, simply recently incorporate some papers about business periods in appearing market financial systems appeared. Usually they review economic fluctuations within particular countries (e. g. Benczur and Ratfai, 2005) or make a few cross-country side by side comparisons (e. g. Aguayo ou al., 2004 or Carmignani, 2005).

A common methodology employed in the analysis of organization cycles (based on observations of adult economies and economic theory) distinguishes pro-cyclical, counter-cyclical and a-cyclical variables. Pro-cyclical parameters fluctuate combined with GDP (e. g. industrial production, investment, employment, inflation), countercyclical parameters against GDP (e. g. unemployment, net exports) and a-cyclical parameters independently of GDP (e. g. actual interest rates). 1

Regarding timing, the 'stylised facts' of the business cycle recognize leading, lagging and coincident variables: leading variables proceed of GROSS DOMESTIC PRODUCT (e. g. average labour productivity, inventory investment, cash supply), lagging variables adhere to GDP (e. g. pumpiing, nominal interest rates) and coincident factors, as the name suggests, move coincidentally with GDP (e. g. industrial production, consumption, employment) (Snowdon & Vane, 2005, p. 306).

Overall, organization cycles in emerging industry economies (Carmignani, 2005)2 are not much different coming from those in mature financial systems (Snowdon and Vane, 2005, p. 306), By MichaЕ‚ NaroЕјny*

The business enterprise cycle in Poland: wherever do we

stand?

Highlights in

this issue:

• While on the

whole certainly not

different from

older

economies, the

properties of

the business

circuit in Biskupiec, poland

display a lot of

special

qualities

• The present

cycle appears to

have reached a

peak however the

slowdown is definitely

likely not to be

as pronounced

just as the

prior cycle

Quantity IV, Issue 9

03. 08. 3 years ago

ECFIN COUNTRY FOCUS

* Directorate pertaining to the Economies of the Member States.

The views indicated in the ECFIN Country Concentrate belong to the authors just and do not actually correspond to those of the Directorate-General for Economical and Economical Affairs or perhaps the European Commission rate. Economic examination from the Western european Commission's Directorate-General for Financial and Monetary Affairs Identity of

way and timing

is key in operation

cycle evaluation

ECFIN Region Focus Volume level IV, Issue 9 Page 2

but economies in transition (though they do not comprise a homogeneous group) screen some specific characteristics:

• overall, the economy is much more volatile than in the euro place, which is the consequence of structural adjustments and catching-up,

• shocks are slightly less consistent than in the euro location, and changes consequently more frequent,

• government ingestion is more inconsistent than in the euro region, suggesting a substantial discretionary aspect in fiscal policies, but not the one which is actually aimed at cyclical stabilisation,

• employment is a-cyclical in certain, but pro-cyclical in other emerging economies, • inflation in emerging financial systems is unstable...

References: Aguayo E., M-C. Guisan & A. Carballas (2004), " Economic Expansion and Periods in

Poland, Hungary, Czech Republic, Slovakia and Slovenia: A comparison with Spain,

Austria and other EUROPEAN countries, 1950-2002", Euro-American Connection of

Economic Development Research, Working Paperwork Series, Financial Development

The european countries: The Facts", CEPR Discussion Paper Number 4846, offered by SSRN:

http://ssrn.com/abstract=717682

Burnside C., M. Eichenbaum & H. Rebelo (1993), " Labour hoarding as well as the

business cycle", Journal of Political Overall economy, Vol

Carmignani F. (2005), " The functions of Business Cycles in Selected

Euro Emerging Industry Economies", Un Economic Commission for

Romer D. (1996), Advanced Macroeconomics, McGraw-Hill

Snowdon B

Expansion and Current State, Edward cullen Elgar, Cheltenham, UK, june 2006

1 Pro- or counter-cyclicality of factors (a technological aspect) ought not to be confused with pro- or counter-cyclicality of policies.

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