Economic Archive

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  Reforms to the Common Agricultural Policy and Benefits to Bulgaria

  The paper deals with issues related to the evolution of the Common Agricultural Policy of the European Union (CAP) and the process of reforms the policy has been undergoing. It also provides a retrospective analysis in order to outline both favourable and adverse aspects of the impact which CAP has had on the development of the agricultural sector ... The paper deals with issues related to the evolution of the Common Agricultural Policy of the European Union (CAP) and the process of reforms the policy has been undergoing. It also provides a retrospective analysis in order to outline both favourable and adverse aspects of the impact which CAP has had on the development of the agricultural sector in Europe in general and in Bulgaria in particular. It is thus possible to highlight the benefits which our country could gain from those reforms by taking into consideration changes in existing regulations and the implementation of related policy instruments. The paper also reviews what was achieved in our country in the 2007-2013 programme period in result of implementing the CAP. Finally, it outlines expectations related to Bulgarian agriculture for the next programme period in terms of the changes introduced into that policy by the European Commission.

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  Comparative Analysis of the Leading Consumption-Based Asset Pricing Models

  The article analyzes in depth the consumption-based asset pricing models, and displays most perspective contemporary trends in the field. A conceptual framework of models has been originally presented linking macroeconomic and financial relationships, and mathematical basis of the classic CCAPM has been developed. The paper also brings out the ... The article analyzes in depth the consumption-based asset pricing models, and displays most perspective contemporary trends in the field. A conceptual framework of models has been originally presented linking macroeconomic and financial relationships, and mathematical basis of the classic CCAPM has been developed. The paper also brings out the leading approaches for modification of the basic model, overcoming some of its shortcomings, and analyzes the advantages, disadvantages and the ability of consumption-based modern models to recreate empirical correlations in profitability and the risk of financial assets. The leading conclusion of the article is that there is still no convincing rational consensus model to reproduce adequately the characteristics of financial markets. From an econometric perspective, the closest in this endeavour is the model of long-term risk of Bansal and Yaron (2004) and its modifications.

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  Testing the Damodaran Approach to Estimate the Cost of Equity in Emerging Markets

  The cost of equity is one of the key financial and economic indicators in corporate finance. The purpose of this paper is to test the well-known approach of Damodaran in global emerging markets. The main result of the study is that the Damodaran approach needs to be improved as it maintains constant deviation from the observed ex-post cost of ... The cost of equity is one of the key financial and economic indicators in corporate finance. The purpose of this paper is to test the well-known approach of Damodaran in global emerging markets. The main result of the study is that the Damodaran approach needs to be improved as it maintains constant deviation from the observed ex-post cost of equity.