As the independence of national central banks in the European Union is one of the main institutional features of the monetary constitution of the EU, the paper tries to find out whether central banks are factually independent in their decisions about interest rates if they face political...

According to efficient markets theory, the stock price on a competitive market is the best estimate of the stock’s present value. This is the basic assumption for predictions using experimental markets. The first part of the paper describes the features of such an experimental market,...

Excessive credit growth is often considered to be an indicator of future problems in the financial sector. This paper examines the issue of how to determine whether the observed level of private sector credit is excessive in the context of the “countercyclical capital buffer”, a...

The paper uses a dynamic inconsistency model known from monetary policy to assess three alternative proposals how to reform fiscal constitution in order to limit government’s incentive to use fiscal policy for maximizing political support. The return to ever-balanced-budget rule,...

This article discusses the effect of foreign direct investment on the corporate sector in the Czech Republic. The analysis uses subaggregated corporate data from a unique Deutsche Bundesbank database containing an almost complete sample of German enterprises that invested in the Czech Republic...

This paper focuses on the development of the interbank market risk premium in the Czech Republic during the global financial crisis. We explain the significant departure of interbank interest rates from the key monetary policy rate by a combination of different factors, including liquidity risk,...

This paper focuses on how firms obtain financing from domestic banks, using a unique loan-level data set for the Czech Republic. The results show that the vast majority of firms use the services of just one relationship lender. Small and young firms in technology- and knowledge-intensive...

Politicians’ efforts to stay in office may lead to the occurrence of political cycles in legislation activity. The aim of this article is to analyze the political legislation cycles in a post-socialist economy of a young democracy, namely in the Czech Republic. Our estimation of the...

This paper focuses on policy measures taken to curb bank credit growth in the private sector in the pre-crisis period 2003–2007. Our analysis is based on an original survey conducted in 2010 on eleven central banks in Central and Eastern Europe (CEE). The findings reveal substantial policy...

The paper compares the quality of the institutional framework of the Czech Republic with other new EU Member States and the EU 15 average using the World Bank data on Governance Indicators and argues that the pressure from the EU institutions during the accession negotiation period to reform the...