ANALYSIS OF THE FACTOR OF SAVINGS OF PRIVATE PROFIT ENTERPRISES IN BIH BY APPLICATION OF ECM METHODOLOGY Cover Image

ANALYSIS OF THE FACTOR OF SAVINGS OF PRIVATE PROFIT ENTERPRISES IN BIH BY APPLICATION OF ECM METHODOLOGY
ANALYSIS OF THE FACTOR OF SAVINGS OF PRIVATE PROFIT ENTERPRISES IN BIH BY APPLICATION OF ECM METHODOLOGY

Author(s): Irma Đidelija, Rabija Kapetanović-Somun
Subject(s): National Economy, Business Economy / Management, Economic history, Economic policy, Political economy, Methodology and research technology, Economic development, Transformation Period (1990 - 2010), Present Times (2010 - today)
Published by: Ekonomski fakultet u Sarajevu
Keywords: savings; econometric analysis; measures of economic policy;

Summary/Abstract: The purpose of this research is to examine the factors that affect savings of private profit enterprises in BiH. Domestic savings as an alternative source of capital, in the opinion of most economists, is a much more reliable and rational source of investment funds. Therefore, the aim of this survey is to determine which factors can stimulate domestic savings of private profit enterprises with further growth-backs in growth and overall economic growth. Most of the analyzes are mainly macroeconomically focused on total private savings. In this way, there is no difference in the absolute and maturity of determinants of private savings, which is especially important for small, growing economies. This research investigated the impact of macroeconomic and financial determinants of savings of private profit companies on the basis of quarterly data from the Agency for Statistics of BiH and the Central Bank of Bosnia and Herzegovina for the period 2000-2016. For this purpose, the seasonalization of the variables used in the analysis by the X-13 ARIMA AND TRAMO/SEATS access. The model includes only nonstationary variables of the first order integrated, which are also coinetegrated, which is a condition for applying the Error Correction Model (ECM). The research results show that in the long run only the coefficients with the general government revenues in the previous period and the deposit interest rate of the company in the previous quarter have a statistical significance different from zero. The negative coefficient with the revenues of the general government suggests that the increase in general government revenue in the long run negatively affects the level of the enterprise’s savings. The deposit interest rate of the company in the previous quarter has an unexpectedly negative impact on the level of enterprise’s savings in the long run.. In the short-term part of the model, only general government revenue and expenditures have shown a statistically significant impact on savings of private profit enterprises. The relatively high value of the adjusted coefficient of determination, 0.607, suggests that almost 61% of variations in the level of private profit enterprise's savings are explained by variations in the set of independent variables included in the ECM model. The obtained research results can be significant indicators for adequate measures of BiH monetary and fiscal policies and can further be indicators for the overall macroeconomic decision of the state.

  • Issue Year: 2020
  • Issue No: 38
  • Page Range: 9-28
  • Page Count: 20
  • Language: English