Purpose of this paper-The last two decades have been characterised by a rise in income and wage inequality in a wide range of countries, including European transition countries. The rise in globalisation is one major factor explaining this increasing wage inequality. International trade and FDI have increased significantly since the beginning of transition and this paper focuses onexamines whether FDI plays an important role in explaining the pattern of wage inequality in selected transition countries. Design/methodology/approach-A crosscountry empirical investigation has been conducted using two alternative measures of wage inequality: the Gini coefficient and the Theil index. Several model specifications and estimation strategies have been employed to obtain consistent estimates and to check for the robustness of the results. Findings-The results indicate that a rising share of inward FDI in GDP increased wage inequality in transition economies, though its overall effect was relatively small. Considering the long run, there is no clear evidence of a concave relationship between FDI and wage inequality, which may be a consequence of the relatively low high levels of FDI in manyost transition countries. Practical implications-Inwards FDI has made a small contribution to increasing wage inequality in European transition economies. However, its overall beneficial effects on labour markets in these countries suggests that rather than restricting FDI governments should target increasing the supply of skilled labour. What is original/value of paper-This new empirical evidence supports the hypothesis that an increased inward FDI stock as a share of GDP increases wage inequality in transition economies, however this relationship ismay be a complex one. Differences in average wages, wage differentials, employment shares of skilled workers and relative size of the foreignowned sector are all likely to be important for the behaviour of wage inequality.
This paper investigates how typical macroeconomic indicators affect the economic growth of Western Balkans countries. A static panel empirical investigation for the period 2010 to 2019 has been conducted using GDP growth rate as the dependent variable, while independent variables in focus include foreign direct investments, remittances, unemployment rate, population growth rate, and control of corruption. The most interesting finding is that a rising share of remittances positively affects economic growth. This might indicate that even when remittances are used for non-investment purposes, they might increase domestic production of consumption and intermediate goods. There is also evidence of a non-linear relationship between FDI and economic growth, which may be a consequence of undeveloped capacities to use the positive side of FDI. To foster economic growth policy-makers should focus on reforms that target sectors that show sharp declines in FDI and remittances inflows, including also a need for better control of corruption in the region.
The level of educational attainment and skills of young people have a strong influence on economic activity and consequently on their employment rates. Grade point averages (GPA) of undergraduate studies keep on being a relevant selection tool in the employment process. GPA metric is believed to be an index of mental ability related later to job performance and successful outcomes. Youth employment in Albania and North Macedonia is low and unresponsive to the education of young people. This study offers an overview of youth unemployment rates in the Western Balkan countries. It uses survey analyses of tertiary graduates of economics programs at Luigj Gurakuqi University in Albania and South-East European University in North Macedonia. A comparative analysis focusing on the determinants of the employability of economics graduates in the last decade is realized using qualitative and quantitative analyses for each university. Logistic regression results indicate that the GPA of the bachelor program is an important factor in the employment of graduates. Additional variables such as gender, time of graduation, and obtaining a master's degree play an important role in being employed in Luigj Gurakuqi University. Developing educational attainment by updating educational and vocational curricula taking into account market demands would improve the school-to-work transition of youth.
Return migration may be associated with the addition of new human capital, entrepreneurial skills and investment funds in the country of origin. The size of these stimuli will likely depend upon the characteristics of the return migrants and the motivation for their return. This paper presents an analysis of the determinants of the probability of Albanian return migrants being in employment. This study examines the role of the socio-demographic characteristics of returning migrants; their experience while abroad and the motivations for their return. The results suggest that being male, holding a university degree, being unemployed before returning and receiving training while abroad increase the probability of finding a job after return. The higher probability of returnees being in employment or self-employment indicates that the overall benefits to the economy of return migrants may be much larger than previously thought. Facilitating or accelerating the social integration and employability of return migrants to Albania could encourage more emigrants to return and provide a further boost to its economy.
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