Published: 29.06.2018

Today at the award ceremony held at Latvijas Banka, prizes were awarded to the winners of the 16th Competition of Student Scientific Research Papers

The first prize in the competition was awarded to Filip Drazdou and Darya Labok, students of the Stockholm School of Economics in Riga, for the paper "Raspberries vs Wheat:Economic Sophistication as a New Predictor of Income Volatility". The paper analyses whether export diversification and ubiquity are the factors affecting output volatility. The authors have concluded that output is less volatile in the countries exporting unique products, while there is no link between the degree of export diversification and output volatility. It has been also found that output volatility is positively correlated with the volume of external trade, volatility of the terms of trade and credit to the private sector.

The second prize was awarded to Oskars Baltais and Rihards Braķis, students of the Stockholm School of Economics in Riga, for the paper "The Effect of Personal Income Tax Progressivity on Output Volatility: the Role of Non-linearity". The authors of the paper have assessed whether there is any relationship between the personal income tax progressivity and GDP volatility, and whether this relationship is linear. They have concluded that the personal income tax progressivity reduces GDP volatility and that this relationship is linear. Moreover, GDP volatility is increased by the volume of external trade.

The third prize was awarded to three Competition papers.

Anna Marija Radzeviča and Krista Bulderberga, students of the Stockholm School of Economics in Riga, have assessed the impact of several institutional factors on economic growth in 113 countries across the globe in their paper "The Role of Institutional Quality in Economic Growth: Implications for the Baltic  States". The results of the paper show the statistically significant positive impact of the following factors on economic growth: government effectiveness, regulatory quality, tax burden, monetary policy discretion, financial freedom, international trade openness, and level of auditing standards. These results are attributed to the Baltic States to put forward appropriate recommendations for stimulating their economic growth.

In the paper "The Determinants of Economic Growth in the EU NUTS2 Regions", Aleksejs Srebnijs and Maksims Sičs, students of the Stockholm School of Economics in Riga, have investigated the factors determining economic growth in the breakdown by regions of the European Union and concluded that a higher level and better quality of education, as well as higher shares of prime age population, information technology patents and manufacturing are positively correlated with subsequent economic growth.

The author of the paper "Assessment of the Financial Cycle in Latvia" Rūdolfs Krēgers, student of the University of Latvia, has concluded that the financial cycle in Latvia was on the upswing during the period from 2000 to 2008 and that its peak reached in 2008 strengthened spillovers from the economic crisis. A new upswing of the financial cycle started in 2015, and now it is at an early stage. It has been suggested that in case of Latvia, the financial cycle is most characterised by the dynamics of loans and the movements of real estate prices. The author has concluded that attention should be paid to the upswing of the financial cycle in the coming years to ensure timely implementation of macroeconomic policies appropriate for its stabilisation.

The consolation prize was awarded to the paper "The Exit from Unconventional Monetary Policy: Is the European Central Bank at Risk?" Its authors Anton Nartov and Malika Yousupova, students of the Stockholm School of Economics in Riga, have analysed the way in which the euro area will exit unconventional monetary policy and what are the associated risks.

Zoja Razmusa, Deputy Governor of Latvijas Banka, extended a warm welcome to the participants of the award ceremony. She emphasized that papers of very high quality have been submitted to the traditional competition and that they will be useful for economic policy discussion. Zoja Razmusa said: "This competition is a platform where we try to align your academic and professional interests that have emerged during your studies with the need for bright minds and new ideas of the country, the sector and also of the national central bank".

The authors of the papers winning awards received money prizes and the collector coin "Smith forges in the sky".

During the award ceremony, the participants could discuss the papers winning awards and present their views about the latest economic developments in Latvia.

To promote the research and analysis of Latvia and euro area's macroeconomic issues by involving the most talented young economists in this work, Latvijas Banka organised its annual, already the 16th Competition of Student Research Papers for academic year 2017/2018.

13 papers were submitted to the competition this year. The number of papers has slightly increased in comparison with the previous year; moreover the quality of the papers submitted increases each year. 21 authors (some papers have two authors) from four higher education establishments of Latvia (the Stockholm School of Economics in Riga, the University of Latvia, the Riga Technical University and the BA School of Business and Finance) have submitted their papers.

Today the Competition materials are going to be published on the websites of Latvijas Banka at and