Naslov
The Impact of Financial Integration on Sectoral Polarization between Croatia and Eurozone Countries

Autori
Pečarić, Mario ; Tolj, Ante ; Blažić, Helena

Vrsta, podvrsta i kategorija rada
Poglavlja u knjigama, znanstveni

Knjiga
Real and Financial Sectors in Post-Pandemic Central and Eastern Europe : the Impact of Economic, Monetary, and Fiscal Policy

Urednik/ci
Olgić Draženović, Bojana ; Buterin, Vesna ; Suljić Nikolaj, Stella

Izdavač
Springer

Godina
2022

Raspon stranica
51-65

ISBN
978-3-030-99850-9

ISSN
1431-1933

Ključne riječi
Financial integration ; sectoral polarization ; Croatia ; Eurozone

Sažetak
The purpose of this paper is to analyse the impact of financial integration, as measured by bilateral FDI, on sectoral structures in Croatia and eurozone countries. The research objective is to determine whether there is a “bad” specialisation, i.e., a separation of sectoral structures that increases the costs of monetary integration of Croatia. The “bad” specialisation is the result of the inefficient allocation of productive resources to sectors with lower productivity. The research results show that financial integration promotes Croatia’s specialisation and makes the country more vulnerable to the occurrence of idiosyncratic shocks, which increases the costs of Croatia’s monetary integration. Moreover, the process of structural divergence shifts the specialisation of the Croatian economy to non-tradable sectors, making real convergence with more developed euro area countries more difficult. The impact of financial integration on the sectoral structures of Croatia and eurozone countries in the period 2001–2019 is analysed using a panel model. The panel results show that the impact is stronger if we exclude the crisis years. This suggests a stronger polarisation of sectoral structures between Croatia and eurozone countries during periods of larger FDI inflows to Croatia

Izvorni jezik
Engleski

Znanstvena područja
Ekonomija

POVEZANOST RADA