D22 - Firm Behavior: Empirical AnalysisReturn

In this paper, we examined the relationship of sports performance and revenue generation in the English Premier League (EPL) to understand how performance on the field impacts financial performance of professional football clubs. Further, we verified if increased wage expenses help improve sports performance. Independent dynamic models were estimated by GMM on panel data including N = 28 EPL teams and on a reduced data set excluding the top six teams (N = 22), spanning from the 2008/2009 to 2018/2019 seasons (T = 11). The results of the GMM models confirmed that sports performance and revenue generation significantly correlate. Teams with better sports performance do generate higher revenues. Additionally, higher wage expenses result in better sports performance. A positive relationship of the variables in both hypotheses were established in both directions (full data). In all analyses of reduced data, the parameters of interest are nonsignificant. Dependencies exist due to the top teams.

The Covid-19 pandemic has had a significant impact on the service sector. This paper aims to assess how firms in the service sector changed their behavior during the covid-19 pandemic regarding innovations and using flexible forms of work. We obtained responses from approximately 300 companies operating in the Moravian-Silesian region service sector through a questionnaire survey. We show that the most common innovation firms use organizational and process innovation. Moreover, we found that larger, younger, and more internalized firms enjoyed more innovation during the pandemic than others. While changes in part-time jobs and agreements held outside the employment relationship are temporary, changes in home office use and outsourcing appear to be permanent.

In many transition countries, a considerable part of economic activity takes place in the informal sector. On the other hand, tax evasion constitutes a major problem and causes improvements to all levels of the informal sector in which the volume of the informal sector in transition countries is much higher than in developed countries. Previous works have examined separately both the determinants of the size of the informal sector and the determinants of tax evasion for transition countries. But, this paper complements these significant works by examining cross sectional analysis based on firm-level data for South Caucasian countries. In addition, our paper has a new contribution to previous works by providing some empirical evidence for informality and tax evasion with the quality of business environment. Building on a simple analytical framework, we test the channels affecting the degree of informality in South Caucasian countries and vice versa, the channels affecting the degree of tax evasion. We use instrumental variable OLS and find that the extent of informality is determined by tax evasion, as well as the extent of tax evasion is determined by the informality for these countries. In addition, we find that the business environment has implications for both informal economy and tax evasion. These results suggest generally ameliorating the business environment in South Caucasian countries, while strengthening an access to land and financial sources, adequate provision of public capital such as telecommunication, transport and electricity infrastructure will reduce informality, reigning the corruption, tax administration and labor regulation will reduce tax evasion and ultimately lead to increasing government revenue collections.