The determinants of errors and omissions in a small and open economy: The case of Slovakia

Mária Širaňová and Menbere Workie Tiruneh ()
Additional contact information
Menbere Workie Tiruneh: Institute of Economic Research, SAS

Working Papers from Institute of Economic Research, Slovak Academy of Sciences

Abstract: This paper aims to empirically explore dynamics of the Net errors and omissions in a small and open economy of Slovakia. Data on the Net errors and omissions during the 2008-2014 period, which is known as the Great Recession, seem to suggest that the change in trend has been predominantly a phenomenon of real economy, mainly the service sector. Even though the paper does not find evidence of illicit financing (hot money flows) during the period under investigation the link between evolution of foreign direct investments and the NeO might point to a possible tax optimization. Likewise, our estimates have not confirmed existence of a connection between the dynamics of NeO and trade misinvoicing for goods during the period. Given the absence of detailed bidirectional data on the service sector, the results need further empirical investigation to determine the true extent of the impact of service sector on the NeO item.

Keywords: balancing item of balance of payments; net errors and omissions; illicit capital flows (search for similar items in EconPapers)
JEL-codes: F32 F41 (search for similar items in EconPapers)
Pages: 49 pages
Date: 2016-04-08, Revised 2016-04-08
References: View references in EconPapers View complete reference list from CitEc
Citations: View citations in EconPapers (1)

Downloads: (external link)
http://ekonom.sav.sk/uploads/journals/317_wp73.pdf (application/pdf)

Related works:
This item may be available elsewhere in EconPapers: Search for items with the same title.

Export reference: BibTeX RIS (EndNote, ProCite, RefMan) HTML/Text

Persistent link: https://EconPapers.repec.org/RePEc:sav:wpaper:wp73

Access Statistics for this paper

More papers in Working Papers from Institute of Economic Research, Slovak Academy of Sciences Contact information at EDIRC.
Bibliographic data for series maintained by Peter Renac ().