Economic Analysis <p><strong>Economic Analysis</strong>&nbsp; is a scientific journal published by the Institute of Economic Sciences (IES). It is published twice a year (in June and in December) in English, in printed and e-version. Economic Analysis's <strong>mission</strong> is to inform scientific and professional public about the results of original research in the field of economics, as well as about the positive public policies intended for surpassing the identified challenges.</p> <p>Since 2018, the journal is ranked as the leading national journal (M51) in the filed of economics and organizational science according to the decree of the Ministry of education, science and technological development of the Republic of Serbia.</p> <p><strong>For any information, you can contact us on e-mail <span style="text-decoration: underline;"></span></strong></p> Institute of Economic Sciences, Belgrade, Serbia en-US Economic Analysis 1821-2573 <p>Once the manuscript is accepted for publication, authors shall transfer the copyright to the publisher. If the submitted manuscript is not accepted for printing by the journal, the authors shall retain all their rights. The following rights on the manuscript are transferred to the publisher, including any supplementary materials and any parts, extracts or elements of the manuscript:</p> <ul> <li>the right to reproduce and distribute the manuscript in printed form, including print-on-demand;</li> <li>the right to print prepublications, reprints and special editions of the manuscript;</li> <li>the right to translate the manuscript into other languages;</li> <li>the right to reproduce the manuscript using photomechanical or similar means including, but not limited to photocopy, and the right to distribute these copies;</li> <li>the right to reproduce and distribute the manuscript electronically or optically using and all data carriers or storage media, and especially in machine readable/digitalized form on data carriers such as hard drive, CD-ROM, DVD, Blu-ray Disc (BD), Mini Disc, data tapes, and the right to reproduce and distribute the article via these data carriers;</li> <li>the right to store the manuscript in databases, including online databases, as well as the right to transmit the manuscript in all technical systems and modes;</li> <li>the right to make the manuscript available to the public or to closed user groups on individual demand, for use on monitors or other readers (including e-books), and in printable form for the user, either via the Internet, online service, or via internal or external networks.</li> </ul> <p>Authors reserve the copyright to published articles and have the right to use the article in the same manner like third parties in accordance with the licence&nbsp;<strong>Attribution-Non-Commercial-Non-Derivate 4.0 International (CC BY)</strong>. Thereby they must quote the basic bibliographic data of the source article published in the journal (authors, article title, journal title, volume, pagination).</p> The Puzzle of Relationship between the Economic Growth and Happiness <p>In economic research, the relationship between economic growth and happiness is ambiguous. Happiness does not show a positive or negative dependence on economic growth over time. Based on the theoretical foundations and using interdisciplinary concepts in economics, e.g. political economy, technology philosophy, generalized method of moments (GMM), and data of 153 countries over the period 2000–2018, this paper tries to show that the one-dimensional look at economic growth and ignoring the growth consequences, including emotional gap, environmental degradation, and oligarchy (lack of healthy democracy), have a crucial role in creating growth and happiness. The main purpose of this study is to accept or reject the theory of Easterlin, called the “Easterlin puzzle”. According to Easterlin puzzle, the growth and development of countries do not increase the happiness of the people in those countries. Based on the model estimated in the present study for 153 countries, the theory of Easterlin is not approved, and economic growth has had a small but significant effect on short- and long-run happiness in these countries.</p> Yazdan Naghdi Hamid Amirtaemeh Soheila Kaghazian ##submission.copyrightStatement## 2021-06-02 2021-06-02 54 1 1 12 10.28934/ea.21.54.1.pp1-12 Intentions to Smoking Cessation in the Time of COVID-19 <p>In this study, we examine whether the outbreak of pandemic has given incentive to smoking cessation and which factors are associated with such intentions, emphasizing change of economic conditions and smoking habits in the time of COVID-19. Data were collected through a telephone survey among a representative sample of the Serbian adult population aged less than 65 years (N=1,002) from 11 to 19 May 2020. The current smokers reported whether the COVID-19 pandemic had changed their tobacco products consumption, disposable income and intentions to cease smoking. Among the current smokers, 26.3% reported that the COVID-19 pandemic triggered intentions to cease smoking. On the other hand, 42.4% of smokers reported a decrease in income, while 22.7% of smokers reported increased smoking during the COVID-19 pandemic. Logistic regression reveals that occasional smokers are the most likely to stop smoking (OR 4.17; CI: 2.18 - 7.99), while the majority of other factors (socio-demographic, economic, smoking habits) do not influence the odds of smoking cessation. Lack of association between intentions to cease smoking and pandemic-related worsening of economic well-being might result from low cigarette prices in Serbia. Consequently, higher taxation of tobacco products is recommended to policymakers.</p> Jovan Zubović Aleksandar Zdravković Olivera Jovanović ##submission.copyrightStatement## 2021-06-02 2021-06-02 54 1 13 23 10.28934/ea.21.54.1.pp13-23 The Impact of Digitalization on the Labour Market: The Case of North Macedonia <p>The impact of digitalization on the labour market is very complex and is manifested in different conditions for job creation and job protection, changed needs for occupations and skills, coping with skills mismatch and labour shortage etc. The aim of the research is to determine the possible implications of digitalization on the labour market in North Macedonia, by analyzing relevant labour market indicators and the results of employees’ survey based on identified hypotheses. The analysis of the labour market indicators shows that despite the positive changes, the situation on the Macedonian labour market remains unfavorable i.e. low employment rates, growing skills mismatch and labour shortages in conditions of still high unemployment. The survey results indicate that the digitalization may not cause serious job losses, but it can lead to significant shifts in the employment structure (regarding sectors, occupations, skills, nature of jobs, pressure on the lower skill levels etc.). The influence of digitalization on the labour demand will depend on the employment sector and job profile, as well as on the investments in technology and relevant experience to use it. Also, digitalization could reduce the labour shortages caused by demographic ageing. The survey results show that digitalization will impose changes in the education and professional expertise, management style and organizational culture, as well as in trade union organizations. The findings of this research are meaningful for policy makers, state institutions, employers, trade unions and other stakeholders. The digitalization implies need for coherent approach of all involved parties in North Macedonia.</p> Verica Janeska Aleksandra Lozanoska ##submission.copyrightStatement## 2021-06-02 2021-06-02 54 1 24 40 10.28934/ea.21.54.1.pp24-40 Housing Quality and Human Capital Formation in Developing Countries <p>The main objective of this work is to analyse the relationship between the quality of housing and human capital formation in the context of developing countries. The analysis attempts to fill a gap in the current literature regarding the lack of empirical studies that address the impact that living conditions can have on human capital. The study was performed using cross-sectional data, mostly taken from the UNESCO database, for 52 low and middle-income countries. The estimated empirical models consider average years of schooling as the dependent variable and as the explanatory variable of interest the proportion of the population living in houses with below minimum quality standards . The OLS results obtained suggest a negative association between housing quality and average years of schooling, but with little or no statistical significance, making the empirical analysis inconclusive. We pose that this result might relate to the comparability of the housing quality data provided by UNESCO, highlighting the need to gather more data and produce new, more reliable indicators on the topic.</p> Guilherme Shirazawa Marta Simões ##submission.copyrightStatement## 2021-06-02 2021-06-02 54 1 41 59 10.28934/ea.21.54.1.pp41-59 Change in Consumers’ Behavior during the COVID 19 pandemic as an Opportunity to foster Digital Entrepreneurship in the Republic of North Macedonia <p>The Covid-19 pandemic has a huge impact in different aspects of people’s life and behavior. The pandemic causes both health and economic problems worldwide by reducing companies’ economic activity, increasing unemployment and reducing consumption. In countries affected by the pandemic, people are trying to adapt themselves to the prolonged indoor stays by changing the way of behavior as both citizens and consumers. Demand is depended on consumer’s behaviour, which undoubtedly underwent changes caused with Covid-19 pandemic. Consumers are responding to the crisis in different ways; some of them feel anxious, others are worried and buying in panic, mainly the necessary products and some of them remain indifferent or suspicious despite the government and health professionals’ recommendations. To date, due to the short period from the beginning of pandemic with Covid-19, a limited number of studies are available that focus on the consumer behaviour caused by a new virus. This paper attempts to notify changes of the consumer behaviour because of pandemic with Covid-19 in Republic of North Macedonia. This paper presents the findings from a survey which was conducted in April 2020, soon after the beginning of the pandemic with Covid-19. The findings lead to various aspects of changing consumer behaviour that businesses can use to step up their digital transformation efforts, foster e-commerce and promote an effective and widespread transition of many digital platform activities as a step forward in development of digital entrepreneurship.The findings could also contribute in predicting future consumer behavior, which is significant for many businesses affected by the pandemic. While at the first blush Covid-19 pandemics imposed negative impact from the changed consumer behavior, in the concluding remarks of this paper there are clear indications for some possibilities and new business opportunities in fostering digital entrepreneurship for the present and future.</p> Tatjana Petkovska Mirchevska Natasha Daniloska Diana Boshkovska Vladimir Petkovski ##submission.copyrightStatement## 2021-06-02 2021-06-02 54 1 60 70 10.28934/ea.21.54.1.pp60-70 Corporate Governance of the Companies Listed on the Belgrade Stock Exchange <p>The present article addresses the ex-post metadata statistical analysis of the corporate governance questionnaire of the listed companies at Belgrade Stock Exchange. The period is 2013-2020, with 50 reports filed as public information at the official website of the exchange. Methodology is based on the standardized approach promulgated on the IFC technical support to the exchange. It reflects fully the G20/OECD corporate governance principles and corporate governance assessment quality based on this method. The statistics consisted of handling of large and voluminous data with 50 questions, while the question No. 3 was included as a number but not as a question in the reports. Statistical calculation allowed us to make some conclusions and recommendations. At the same time, we are aware that those reports were not assured or audited internally withing the companies, externally by the auditors or by the stock exchange itself. The main goal of our analysis was to give a standard and harmonized overview on the quality of corporate governance of issuers at the Belgrade Stock Exchange, which in turn could be compared with the relevant exchanges worldwide, also to be used for policy makers, regulators and issuers to make practical steps to further improve the quality of corporate governance.</p> Ivana Ljutić ##submission.copyrightStatement## 2021-06-02 2021-06-02 54 1 71 91 10.28934/ea.21.54.1.pp71-91 Panel Cointegration Analysis of Total Environmental Taxes and Economic Growth in EU Countries <p>This paper examines the relationship between total environmental taxes and economic growth for twenty-eight EU countries from 1994 to 2018. The aim of this research is to evaluate the long-run relationship between these variables based on panel data analysis. The analysis includes panel unit root test, panel cointegration test, panel ordinary least squares, panel dynamic ordinary least squares, as well as, fully modified ordinary least squares models. The results reveal long-run cointegrated relationship between total environmental taxes and economic growth in selected countries. Likewise, there is a significant relation running from total environmental taxes to economic growth measured by gross domestic product rate. Empirical findings confirm that revenue of environmental taxes have a positive and statistically significant effect on economic growth measured by gross domestic product rate in the long-run.</p> Vera Mirović Branimir Kalaš Nada Milenković ##submission.copyrightStatement## 2021-06-02 2021-06-02 54 1 92 103 10.28934/ea.21.54.1.pp92-103 Intellectual Capital Investments and Company's Profitability <p>The purpose of this paper is to investigate the effects of R&amp;D investments on the company profitability, with special focus on the French most innovative companies. The study is divided into three parts aiming to address the three key research questions raised in the study: the first research question &nbsp;examines the influence of R&amp;D investments on company intangible assets; second research question calculates efficiency of capitalized or transformed intangible assets value coming from R&amp;D investments, whereas the third research question examines generated returns on capitalized assets. The method used in this study is the Efficiency of Intellectual Capital (EIC) method developed by Krstić and Bonić (2016). This method investigates the process of Intellectual Capital (IC) value creation within French companies. The study proves that R&amp;D investments influence positively the intangible assets value after a long-term period of investments. After the new intangible assets are created and developed, they positively influence their efficiency, whereas the impact on the company profitability is not determined in the same year. The main research limitations come from the fact that the observed sample of companies is small, and the access to the financial information related to the R&amp;D expenses is limited to the official accounts of companies, whereas companies are not obliged to disclose this information by accounting rules. This study confirms that high-innovative French companies transform long-term R&amp;D investments into concrete intangible assets values. On the practitioners’ side, the study represents a motive for managers to focus more on the investments in IC that will create a concrete value and generate further economic benefits from that value, rather than to concentrate only on short-term improvements of financial performance.</p> Miloš Petković Milica Đorđević ##submission.copyrightStatement## 2021-06-02 2021-06-02 54 1 104 117 10.28934/ea.21.54.1.pp104-117 Military Logistics vs. Business Logistics <p class="1Apstratk">Military logistics as a specific area of logistics management makes the difference between a well-supplied and self-sustainable army which due to an efficiently created supply chain, can perform it’s military actions more efficiently, and an army that, due to insufficient commitment to military logistics activities creates an inefficient army that is cut off from food, water, and other basic resources without which the army can’t function. The specifics of military logistics make this area of logistics management special, formally separated, but essentially very close to the field of business logistics. The aim of this paper is to point out the features that distinguish military logistics management from business logistics management, but also to point out the complexities and limitations that military logistics bring with it. The key determinants of the difference will be presented through the organization of the logistics supply chain, the subjects, participants and goals it involves, but also the risk, the corresponding law, logistics process management approach, innovations, organization systems, and the basic methods of transportation that military logistics brings with it. The given specifics need to be analyzed and compared with the key features of business logistics, where through the examples from practice will be pointed out the points of contact, but also the key differences between these two areas of logistics.</p> Slobodan Aćimović Veljko Mijušković Marko Golubović ##submission.copyrightStatement## 2021-06-02 2021-06-02 54 1 118 138 10.28934/ea.21.54.1.pp118-138 International Acquisitions and Labor Productivity in Serbian Cement Industry <p>This paper investigates the impact of international acquisitions on the productivity of acquired companies in the cement industry of the Republic of Serbia. We analyze the productivity of companies in the cement industry during the twenty-year period from 2000 to 2019. Acquisitions in the cement industry are one of the first international acquisitions realized in the Republic of Serbia. The multinational companies that took over the cement plants are from Switzerland, France and Greece. The paper analyzes the effects of international acquisitions on the productivity of acquired companies in the short and long term. The research results show that the productivity of all acquired companies improved both in the short term and in the long term after the acquisitions, with the largest productivity improvements being achieved in the short term. In addition, the research results show that Lafarge Serbia recorded the largest improvement in labor productivity, which, compared to other companies, optimized the number of employees and increased production volume.</p> Slađana Savović Dušan Marković ##submission.copyrightStatement## 2021-06-02 2021-06-02 54 1 139 156 10.28934/ea.21.54.1.pp139-156