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Studies and researches
Vol. 10 Issue 1 - 6/2018
Performance Dissimilarities in the Activity of Foreign and Romanian-Owned Companies: What Lessons to be Learned?
Our paper addresses the activity of the foreign-capital controlled companies versus domestic companies in Romania, in order to highlight the differences in performance between the two categories of firms, given the increased importance of foreign-owned companies in the Romanian economy in recent years. The research and analysis are based on data available from Eurostat FATS - Foreign Affiliates Statistics. The comparative analysis of performance between foreign-owned and Romanian-owned companies is carried out for the period 2008-2014 on two levels: (i) The total performance of foreign-owned and Romanian-owned companies; (ii) The determination of the “average”-sized foreign-owned and Romanian-owned company attributes. Our main findings show that foreign-owned companies generate higher cash flows that are essential for business development, backed up by a higher value of production, higher turnover and higher gross operating profits, despite a higher number of employees and higher personnel costs compared to Romanian-owned companies. At the same time, Romanian-owned companies claim higher profitability ratios due to their reduced dimensions. Read more
performance, foreign-owned companies, Romanian-owned companies, foreign direct investment

F23, L25, O10
Studies and researches
Vol. 11 Issue 2 - 12/2019
Assessing the Local Developmental Impact of Hydrocarbon Exploitation in a Mature Region: A Random Forest Approach
The impact of natural resource exploitation has been a controversial topic, subject to intense debate. The literature has traditionally focused on its consequences on national socioeconomic development. More recently, scholars concentrated on local effects following greater availability of data at the subnational and project level. We add to the literature by concentrating on Romanian oil and gas operations, a mature region with a long history of hydrocarbon activities. Such regions have seldom been studied and we argue that in light of the ongoing energy transition these should garner greater interest, particularly those located within the European Union where environmental pressure is significant. Our methodology consists of testing the ability of the random forest classification algorithm to distinguish between local communities with oil and gas operations present and those without on a number of indicators which could be broadly considered developmental. The algorithm fails to accurately classify hydrocarbon-intensive communities, indicating that there are no significant differences between these and the rest. We argue that this is likely due to the limited tax collection powers of local governments, with royalties going directly to the central government with no specific distribution provision at the local level. Another potential explanation may be the diversification of local economies and existing related manufacturing and services activities. Read more
random forest, resource curse, hydrocarbon, extractive industry, local development

O13, Q32, Q35
Studies and researches
Vol. 13 Issue 1 - 5/2021
Foreign Exchange and Oil Exposure of CEE Companies: Risks for Investors in Financial and Energy Industries
The main aim of this paper is to analyse the exposure to exchange rate risk of 24 financial and energy companies from 4 Central and Eastern European countries, i.e., Romania, Hungary, Poland, and Czechia, using datasets covering the period between January 2010 and December 2017. The largest listed companies from financial and energy industries were selected by market capitalization and based on available data for this period. This study investigates the link between stock prices and a number of variables, such as stock market indices, monthly changes in the exchange rate of the domestic currencies to the EUR and USD, real GDP growth rate, Brent crude oil prices and 1-year bond yields. Applying the panel data methodology, the findings indicate that for both types of companies, when considering the stock market index, significant exposure to this variable is discovered. When excluding this variable from the equation at the financial companies, there is a significant exposure to the change in the exchange rate of the domestic currencies to the both EUR and USD and unexpectedly, to the oil price changes, fact that displays a remarkable result for the financial companies. The price of crude oil had a much greater impact on the stock prices of the financial companies than it was expected and at the same time, it seemed to be a risk factor. For the energy companies, when removing the stock market index from the equation, significant exposure is found to the change in the exchange rates of domestic currencies to the EUR and to the change in the price of oil. The exposure to Brent crude oil price turned out to be positive in both situations. Read more
currency risk, stock prices, stock market indices, panel data analysis, Central and Eastern Europe (CEE)

G15, C33, F31
EJIS is published under the research grant no. 91-058/2007 The Development of Interdisciplinary Academic Research Aimed at Enhancing the Romanian Universities International Competitiveness, coordinated by the Bucharest Academy of Economic Studies and financed by CNMP Romania.
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