The paper examines the relationship between leverage and growth in a group of emerging central and eastern European countries, who are at different levels of financial market development. We hypothesize a non-linear relationship in that moderate leverage could boost growth while very high...

A dynamic process underlying firms' discrete financial choices has previously been found, but without controlling for unobserved heterogeneity, this dependence can either be of a true nature or an effect of firm-specific characteristics that we cannot observe. This study extends previous...

The paper investigates young firms' choice of capital source. Our theoretical model hypothesizes a positive (negative) relation between riskiness of the project (price of venture capital) and receiving informed equity. We test our predictions by employing a unique data set collected by KfW...

The picture of the securities exchanges and financial sectors in CEE countries is still relatively unfavorable. The CEE securities exchanges – with the only exception of the Warsaw Stock Exchange – are, in comparison with their western counterparts, underdeveloped and less important for the...

Based on a spatially augmented gravity model the current paper isolates spatial interrelationships in Foreign Direct Investment (FDI) to Central and Eastern European Countries (CEECs) not only across the destination but also across the origin country dimension of FDI. Results show that: (i)...

Two or three decades from now, economic historians will note that a hallmark of successful transformation in Central and Eastern Europe (CEE) was the speed in which it became a non-issue for the body politic. A corollary of this is the expectation that, as formerly centrally planned economies...

National science and technology (S&T) systems are mentioned, in politics as well as in science, as a condition for the competitiveness of domestic high technology industries. An active S&T policy has, therefore, great importance for governments. Eastern European countries see, in an active S&T...

Monetary policy in CEE is an important determinant in the wage bargaining process, because trade unions have to predict inflation as one component of future real wages. This paper scrutinizes whether countries in CEE that officially announce an inflation target are tempted to act...

Existing theories of a firm's optimal capital structure seem to fail in explaining why many healthy and profitable firms rely heavily on equity financing, even though benefits associated with debt (like tax shields) appear to be high and the bankruptcy risk low. This holds in particular for...