Prizes were awarded to the winners of the Competition of Student Scientific Research Papers organised by Latvijas Banka

  • Latvijas Banka
    Latvijas Banka
Illustrative photo students
Photo by: Latvijas Banka

Today at the award ceremony held at Latvijas Banka, prizes were awarded to the winners of the 21st Competition of Student Scientific Research Papers. 

🔷The first prize was awarded to Lotte Vahelaan and Linda-Terese Makk (SSE Riga)

Unleashing the Potential of Estonian Firms: An Empirical Analysis of the Impact of ERDF Grants

The content of the paper:

The authors explore the effect of obtaining grants from the European Regional Development Fund (ERDF) on the performance of Estonian firms over the period 2014–2020. The firm-level dataset is sourced from the Estonian E-Business Register and the State Shared Services Centre. Based on application of the propensity score matching and difference-in-differences estimation techniques, the authors demonstrate a significant positive effect on revenue, employment, and wages, but not on labour productivity. The authors emphasise that initially younger, and lower-income firms gain from the grant. The results generally indicate that obtaining an ERDF grant has an indispensable role in expanding the workforce and providing financial resources, especially for less-established firms.

🔷The second prize was awarded to Annemarija Apine (Bocconi University)

Industry Flexibility and Gender Pay Gap: Empirical Evidence from Italy 

The content of the paper:

The author investigates the hypothesis whether industry (in)flexibility has been a substantial factor in determining the gender pay gap in Italy where it was reported that in 2009 only 46% of Italian women of working age were active in the labour market and the percentage of women working a part-time job about 5 times exceeded that of men. The author combines income data sourced from the social security contributions (LoSaI) data set and the Italian Labour Force Survey. The author concludes that the major effect shaping the gender pay gap in Italian labour market can be attributed to be the convexity in the hours worked and income relationship in combination with the women's tendency to work shorter hours. Other industry flexibility characteristics, such as working Saturdays or the ability to work from home, do not seem to significantly impact the gender pay gap.

🔷The second prize was awarded to Miķelis Jānis Benužs and Ahmad Jahid Sakhi (SSE Riga)

Walking the Talk: Do Socially Responsible Funds Invest in Companies that Sanctioned Russia? 

The content of the paper:

Using a novel dataset measuring how companies that operate in Russia reacted to the Russian invasion in Ukraine, the authors examine how actively managed funds altered their share ownership in such companies. The authors find that companies that opted to leave Russia primarily have been more financially stable and better performing. Looking at the companies that opted to stay, the authors show that high social responsibility funds reduced their ownership in such companies considerably more than low social responsibility funds. Yet it is shown that most of the institutional investor decisions were driven by past performance, rather than the decision to respond to the war. Therefore, the authors emphasize the importance of effectively communicating social responsibility actions to investors, given that the benefits of such actions may not be reflected in the financial data immediately.

🔷The third prize Emīls Žubulis and Armands Strods (SSE Riga)

In(efficiency) Lasting Over a Decade: A Case of the 2010 Micro Enterprise Tax Regime in Latvia 

The content of the paper:

The authors examine how efficient Latvia's Reform of the 2010 micro enterprise tax regime has been, employing the Synthetic Control Method (SCM), i.e. constructing a "synthetic" Latvia and comparing the economic indicators between the real and the "synthetic" Latvia. The authors find that the micro enterprise tax regime had a positive impact on economic growth and new businesses creation in the early years after its implementation, but the positive effects have since decreased. The authors document that the impact on Latvia's public finances has been negative. 

🔷The third prize Anna Scemeleva and Irina Nagornova (SSE Riga)

The Effect of Inflation on Companies' Performance: Firm-Level Evidence from the CEE Regio

The content of the paper:

The study by using the ORBID database examines the relationship between inflation and firms' financial performance indicators in the Central and Eastern Europe (CEE region) over the period from 2005 to 2021. The authors consider different measures of firms' financial performance and study the effect of headline inflation on various indicators of firms' profitability and liquidity with further inflation decomposition into anticipated and unanticipated components, as well as demand-pull and cost-push inflation. They discover a positive, significant and robust effect of inflation on firms' profitability and liquidity. This effect tends to be larger for the predicted part of inflation but its magnitude is smaller for the unexpected inflation shock. The authors find that this effect mostly comes from demand-driven inflation, whereas cost-push inflation has a negative or insignificant impact on firms' profitability.

🔷The third prize Leonards Norvelis and Ādams Taranda (SSE Riga)

Factoring and SME Financing in Latvia: Firm-level Evidence on Profitability 

The content of the paper:

This paper analyses the effect of factoring on profitability for Latvian small and medium-sized enterprises. Small businesses struggle with delayed receivables, bad debtors, and stricter bank lending, thus factoring may be a viable option where a firm sells its accounts receivables. The results show that factoring adoption is negatively linked with return on assets, but it rapidly expands the asset base to service higher volumes of sales. These findings point towards factoring being a growth product rather than a profitability one. The authors also performed a large-scale corporate survey which confirms the results, as factoring is expected to increase long-term profitability and build relationship with financial institutions to receive other types of credit.

🔷Honourable mention Guntars Ūpis (Erasmus University Rotterdam)

Inflation and Saving: A Panel Data Analysis of the OECD Countries

The content of the paper:

This paper employs a dynamic fixed effect panel data model of 26 OECD countries from 1980 to 2021, focusing on private savings and inflation while controlling for frequently explored saving determinants such as income and income growth, demographics, the real interest rate, fiscal policy and external factors. Despite the results not indicating a meaningful impact of inflation on savings, considering potential time, country and functional form aspects might be important for further research. Nevertheless, this paper thoroughly examines various theoretical aspects of the relationship between inflation and savings, laying a solid foundation for discussing this topical issue.


Mārtiņš Kazāks, Governor of Latvijas Banka, extended a warm welcome to the participants of the event. The authors of the papers winning awards received money prizes.

In the academic year 2022/2023, Latvijas Banka organised its annual 21st Competition of Student Scientific Research Papers, inviting the participation of students from Latvia, Lithuania and Estonia who at the time of the competition were registered as students of bachelor or master programmes of higher educational institutions accredited in the Baltic States as well as inhabitants of the Baltic States studying abroad. 

30 papers were submitted to the competition this year from 10 higher educational institutions of Latvia and foreign countries

APA: Banka, L. (2024, 14. jul.). Prizes were awarded to the winners of the Competition of Student Scientific Research Papers organised by Latvijas Banka . Taken from https://www.macroeconomics.lv/node/5968
MLA: Banka, Latvijas. "Prizes were awarded to the winners of the Competition of Student Scientific Research Papers organised by Latvijas Banka " www.macroeconomics.lv. Tīmeklis. 14.07.2024. <https://www.macroeconomics.lv/node/5968>.

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