IDEAS home Printed from https://ideas.repec.org/p/cnb/wpaper/2006-4.html
   My bibliography  Save this paper

Supply-Side Performance and Structure in the Czech Republic (1995-2005)

Author

Listed:
  • Kamil Dybczak
  • Vladislav Flek
  • Dana Hajkova
  • Jaromir Hurnik

Abstract

In this paper, we apply the aggregate production function to approximate the path of potential output. We use a time-varying NAIRU to derive the amount of potential labour and a newly developed measure of capital services to account for the productive impact of capital. In addition, trend total factor productivity is estimated. Production functions for the key sectors (Agriculture, Industry, etc.) are also calculated, exploring the growth accounting approach and decomposition of total factor productivity growth. During 1995--2005, the growth in potential output was constrained by a gradual increase in the NAIRU, a temporary drop in investment activity and, most importantly, by only a modest rise in total factor productivity. In this period, the Czech economy also suffered from a structural burden, i.e. all growth in total factor productivity was exclusively due to better utilisation of resources, given their initial allocation, with an even negative contribution of resource reallocation. Just from 2001 onwards, we observe substantial improvements in supply-side performance, except for the functioning of the labour market.

Suggested Citation

  • Kamil Dybczak & Vladislav Flek & Dana Hajkova & Jaromir Hurnik, 2006. "Supply-Side Performance and Structure in the Czech Republic (1995-2005)," Working Papers 2006/4, Czech National Bank, Research and Statistics Department.
    • Handle: RePEc:cnb:wpaper:2006/4
    as

    Download full text from publisher

    File URL: https://www.cnb.cz/export/sites/cnb/en/economic-research/.galleries/research_publications/cnb_wp/cnbwp_2006_04.pdf
    Download Restriction: no
    ---><---

    References listed on IDEAS

    as
    1. Lawrence J. Christiano & Terry J. Fitzgerald, 2003. "The Band Pass Filter," International Economic Review, Department of Economics, University of Pennsylvania and Osaka University Institute of Social and Economic Research Association, vol. 44(2), pages 435-465, May.
    2. Barry P. Bosworth & Susan M. Collins, 2003. "The Empirics of Growth: An Update," Brookings Papers on Economic Activity, Economic Studies Program, The Brookings Institution, vol. 34(2), pages 113-206.
    3. Marianne Baxter & Robert G. King, 1999. "Measuring Business Cycles: Approximate Band-Pass Filters For Economic Time Series," The Review of Economics and Statistics, MIT Press, vol. 81(4), pages 575-593, November.
    4. Scott L. Baier & Gerald P. Dwyer & Robert Tamura, 2006. "How Important are Capital and Total Factor Productivity for Economic Growth?," Economic Inquiry, Western Economic Association International, vol. 44(1), pages 23-49, January.
    5. repec:dgr:rugggd:200260 is not listed on IDEAS
    6. Barro, Robert J, 1999. "Notes on Growth Accounting," Journal of Economic Growth, Springer, vol. 4(2), pages 119-137, June.
    7. Vladimir Bezdek & Kamil Dybczak & Ales Krejdl, 2003. "Czech Fiscal Policy: Introductory Analysis," Working Papers 2003/07, Czech National Bank, Research and Statistics Department.
    Full references (including those not matched with items on IDEAS)

    Citations

    Citations are extracted by the CitEc Project, subscribe to its RSS feed for this item.
    as


    Cited by:

    1. Magdalena Borys & Roman Horváth & Michal Franta, 2009. "The effects of monetary policy in the Czech Republic: an empirical study," Empirica, Springer;Austrian Institute for Economic Research;Austrian Economic Association, vol. 36(4), pages 419-443, November.
    2. Jiří Mihola & Petr Wawrosz, 2014. "Alternativní metoda měření extenzivních a intenzivních faktorů změny HDP a její aplikace na vývoj HDP USA a Číny [An Alternative Method How to Measure Impact of the Intensive and Extensive Factors ," Politická ekonomie, Prague University of Economics and Business, vol. 2014(5), pages 583-604.
    3. Mojmír Hájek, 2008. "Ekonomický růst v České republice a nových členských zemích Evropské unie v období 1995-2006 [Economic growth in the Czech Republic and new member states of the European Union in the period 1995-20," Politická ekonomie, Prague University of Economics and Business, vol. 2008(4), pages 435-448.
    4. Kamil Galuscak & Lubomir Lizal, 2011. "The Impact of Capital Measurement Error Correction on Firm-Level Production Function Estimation," Working Papers 2011/09, Czech National Bank, Research and Statistics Department.
    5. Dana Hajkova, 2008. "The Measurement of Capital Services in the Czech Republic," Working Papers 2008/11, Czech National Bank, Research and Statistics Department.
    6. Mojmír Hájek & Jiří Mihola, 2009. "Analýza vlivu souhrnné produktivity faktorů na ekonomický růst České republiky [Analysis of Total Factor Productivity Contribution to Economic Growth of the Czech Republic]," Politická ekonomie, Prague University of Economics and Business, vol. 2009(6), pages 740-753.
    7. Vojtěch Spěváček & Růžena Vintrová & Eva Zamrazilová & Mojmír Hájek & Václav Žďárek, 2008. "Česká ekonomika po vstupu do Evropské unie [The czech economy after its entry into European Union]," Politická ekonomie, Prague University of Economics and Business, vol. 2008(3), pages 291-317.

    Most related items

    These are the items that most often cite the same works as this one and are cited by the same works as this one.
    1. Jaromír Hurník & Dana Hájková, 2007. "Supply-Side Performance in the Czech Republic: A Macroeconomic View (1995-2005)," Prague Economic Papers, Prague University of Economics and Business, vol. 2007(4), pages 319-335.
    2. Dana Hájková & Jaromír Hurník, 2007. "Cobb-Douglas Production Function: The Case of a Converging Economy," Czech Journal of Economics and Finance (Finance a uver), Charles University Prague, Faculty of Social Sciences, vol. 57(9-10), pages 465-476, October.
    3. Jaromir Benes & David Vavra, 2004. "Eigenvalue Decomposition of Time Series with Application to the Czech Business Cycle," Working Papers 2004/08, Czech National Bank, Research and Statistics Department.
    4. Ageliki Anagnostou & Ioannis Panteladis & Maria Tsiapa, 2015. "Disentangling different patterns of business cycle synchronicity in the EU regions," Empirica, Springer;Austrian Institute for Economic Research;Austrian Economic Association, vol. 42(3), pages 615-641, August.
    5. Siem Jan Koopman & Joao Valle e Azevedo, 2003. "Measuring Synchronisation and Convergence of Business Cycles," Tinbergen Institute Discussion Papers 03-052/4, Tinbergen Institute.
    6. Polanski, Arnold & Stoja, Evarist, 2017. "Forecasting multidimensional tail risk at short and long horizons," International Journal of Forecasting, Elsevier, vol. 33(4), pages 958-969.
    7. Gallegati, Marco & Giri, Federico & Palestrini, Antonio, 2019. "DSGE model with financial frictions over subsets of business cycle frequencies," Journal of Economic Dynamics and Control, Elsevier, vol. 100(C), pages 152-163.
    8. Martínez, Juan Francisco & Oda, Daniel, 2021. "Characterization of the Chilean financial cycle, early warning indicators and implications for macro-prudential policies," Latin American Journal of Central Banking (previously Monetaria), Elsevier, vol. 2(1).
    9. Richard Ashley & Randal Verbrugge, 2009. "Frequency Dependence in Regression Model Coefficients: An Alternative Approach for Modeling Nonlinear Dynamic Relationships in Time Series," Econometric Reviews, Taylor & Francis Journals, vol. 28(1-3), pages 4-20.
    10. Liang, Kuo-Yuan & Yen, Chen-Hui, 2014. "Dissecting the cycles: An intermarket investigation and its implications to portfolio reallocation," International Review of Economics & Finance, Elsevier, vol. 33(C), pages 39-51.
    11. Gonzales-Martínez, Rolando & Hurtado, Enrique & Valdivia, Pedro, 2008. "Un método de Cálculo y Temporización de Previsiones Cíclicas para el Sistema Financiero Boliviano [The calculation and timing of cyclical provisions in the Bolivian financial system]," MPRA Paper 14120, University Library of Munich, Germany, revised Feb 2009.
    12. Dewald, William G. & Haug, Alfred A., 2004. "Longer-term effects of monetary growth on real and nominal variables, major industrial countries, 1880-2001," Working Paper Series 382, European Central Bank.
    13. Huseyin Cagri Akkoyun & Bahar Sen Dogan & Mahmut Gunay, 2011. "Turkiye Ekonomisi Is Cevrimlerinin Kuresel Ekonomi ile Iliskisi," CBT Research Notes in Economics 1119, Research and Monetary Policy Department, Central Bank of the Republic of Turkey.
    14. Lake, James & Linask, Maia K., 2016. "Could tariffs be pro-cyclical?," Journal of International Economics, Elsevier, vol. 103(C), pages 124-146.
    15. Martyna Marczak & Víctor Gómez, 2017. "Monthly US business cycle indicators: a new multivariate approach based on a band-pass filter," Empirical Economics, Springer, vol. 52(4), pages 1379-1408, June.
    16. Mathy, Gabriel P. & Meissner, Christopher M., 2011. "Business cycle co-movement: Evidence from the Great Depression," Journal of Monetary Economics, Elsevier, vol. 58(4), pages 362-372.
    17. Claudio Barbieri & Mattia Guerini & Mauro Napoletano, 2021. "The anatomy of government bond yields synchronization in the Eurozone," SciencePo Working papers Main hal-03373853, HAL.
    18. Uebele, Martin, 2011. "National and international market integration in the 19th century: Evidence from comovement," Explorations in Economic History, Elsevier, vol. 48(2), pages 226-242, April.
    19. Gabriel J. Felbermayr & Jasmin Katrin Gröschl & Benedikt Heid, 2020. "Quantifying the Supply and Demand Effects of Natural Disasters Using Monthly Trade Data," CESifo Working Paper Series 8798, CESifo.
    20. repec:ptu:bdpart:b200609 is not listed on IDEAS
    21. Nath, Hiranya K., 2016. "A note on the cyclical behavior of sectoral employment in the U.S," Economic Analysis and Policy, Elsevier, vol. 50(C), pages 52-61.

    More about this item

    Keywords

    Capital services; factor allocation and utilisation; growth accounting; NAIRU; potential output; production function; structural changes; total factor productivity;
    All these keywords.

    JEL classification:

    • E23 - Macroeconomics and Monetary Economics - - Consumption, Saving, Production, Employment, and Investment - - - Production
    • O11 - Economic Development, Innovation, Technological Change, and Growth - - Economic Development - - - Macroeconomic Analyses of Economic Development
    • O12 - Economic Development, Innovation, Technological Change, and Growth - - Economic Development - - - Microeconomic Analyses of Economic Development
    • O47 - Economic Development, Innovation, Technological Change, and Growth - - Economic Growth and Aggregate Productivity - - - Empirical Studies of Economic Growth; Aggregate Productivity; Cross-Country Output Convergence

    NEP fields

    This paper has been announced in the following NEP Reports:

    Statistics

    Access and download statistics

    Corrections

    All material on this site has been provided by the respective publishers and authors. You can help correct errors and omissions. When requesting a correction, please mention this item's handle: RePEc:cnb:wpaper:2006/4. See general information about how to correct material in RePEc.

    If you have authored this item and are not yet registered with RePEc, we encourage you to do it here. This allows to link your profile to this item. It also allows you to accept potential citations to this item that we are uncertain about.

    If CitEc recognized a bibliographic reference but did not link an item in RePEc to it, you can help with this form .

    If you know of missing items citing this one, you can help us creating those links by adding the relevant references in the same way as above, for each refering item. If you are a registered author of this item, you may also want to check the "citations" tab in your RePEc Author Service profile, as there may be some citations waiting for confirmation.

    For technical questions regarding this item, or to correct its authors, title, abstract, bibliographic or download information, contact: Tomas Karhanek (email available below). General contact details of provider: https://edirc.repec.org/data/cnbgvcz.html .

    Please note that corrections may take a couple of weeks to filter through the various RePEc services.

    IDEAS is a RePEc service. RePEc uses bibliographic data supplied by the respective publishers.