Lala Hamidova

Type of the article: Research ArticleAbstractThis study examines the association between multidimensional digital transformation and national startup ecosystem performance across 23 European Union economies, comparing EU11 with 12 selected EU15 economies from 2017 to 2024. The balanced panel contains 184 country-year observations. Principal component analysis is used to construct three composite indicators: the Digital Services Index, Digital Connectivity Index, and Digital Human Capital Index. The indices demonstrate satisfactory factorial adequacy, internal consistency, and one-component structures supported by parallel analysis. Their associations with startup ecosystem performance are estimated using two-way fixed-effects models. Because the panel contains only 23 country clusters, the principal inference uses CR2 bias-reduced country-clustered standard errors with Satterthwaite-adjusted degrees of freedom. In the full-sample specification, DSI has a positive but only marginally significant association with startup ecosystem performance (β = 0.0834, p = 0.082), while DCI, DHCI, and e-government are statistically insignificant. R&D intensity has a negative contemporaneous coefficient that is also marginally significant (β = −0.0145, p = 0.053). Regional heterogeneity is jointly significant and is concentrated primarily in digital connectivity: DCI is negatively associated with startup ecosystem performance in the EU11 group, whereas its total slope is approximately zero in the selected EU15 group. DHCI has a positive total slope within the selected EU15 group, although the difference between the EU15 and EU11 slopes is not statistically significant. A one-year-lagged specification produces a positive but marginal DSI coefficient and does not identify statistically significant associations for the remaining predictors. These estimates should be interpreted as conditional associations rather than causal effects.

By employing OLS, Robust OLS, and ARDL models, the research evaluates the effects of minimum wages (both in PPP and national currency), government expenditures, and unemployment on inflation. The results demonstrate that government expenditures significantly and positively influence inflation in both short- and long-term perspectives. Minimum wages in the national currency are shown to increase inflation in the short run but exhibit a reducing effect with a time lag. Conversely, minimum wages measured in PPP have a deflationary effect, reflecting their stabilizing influence on purchasing power and consumer prices. Unemployment is found to reduce inflation in the short term, aligning with the Phillips Curve theory, while past unemployment levels display a delayed positive effect on inflation, underscoring the complex nature of the relationship. The study highlights the crucial role of fiscal policy in managing inflation in Azerbaijan, particularly in a resource-dependent economy. Furthermore, the impact of Azerbaijan's 2015 currency devaluation was analyzed using a dummy variable approach, confirming no significant structural break in the inflation determinants post-devaluation. These findings provide valuable insights for policymakers in implementing effective inflation control strategies through employment policies, wage regulation, and government spending adjustments.

Telecommunication technologies have entered all spheres of society, creating wide chances for improvement. The splendid, safe, and effective digital revolution in best practices and the productive use of resources in this field are the driving force behind the improvement of innovation. The aim of the study is to identify the main problems of the arrangement and evolution of the digital economy in Azerbaijan, as well as to offer recommendations for the successful usage of digital technology opportunities. Using regression analysis, the impact of the digital economy on economic growth was determined. The analysis showed a direct relationship between the indicators (r = 0.857) and a high closeness of the relationship on the Cheddock scale. The outcomes showed that during the last eight years (2015–2023), there has not been a significant growth in the ICT Development Index in Azerbaijan. According to the ICT Development Index, Azerbaijan ranks 87th, the Development Index of e-government – 83rd, and the Network Readiness Index – 75th in the world. The results stressed the necessity of state support for the digital economy in Azerbaijan to solve problems in this area and the significance of applying the progressive foreign countries’ experience in the digitalization of the economy. The study examines the factors influencing the development of the digital economy in Azerbaijan and offers proposals and recommendations for the effective use of digital technologies that have practical and scientific significance.

This study provides empirical evidence that CO₂ emissions from transport (total and by transport types) have an impact on countries’ logistics efficiency, both in general (Logistics Performance Index) and in terms of its individual indicators (volumes of freight transport (total and by transport types) and total investments in transport infrastructure). The aim is to empirically demonstrate the impact of CO₂ emissions from different modes of transport on the logistics efficiency of countries, specifically using data from 60 International Transport Forum (ITF) member countries. The Granger causality analysis, based on VAR modeling for six periods evaluated by the World Bank (2007, 2010, 2012, 2014, 2016, 2018), demonstrates that in 50% of the countries, changes in CO₂ emissions from transport are the cause of the shifts in the Logistics Performance Index (increasing emissions can impede logistics efficiency). The sample was reduced to these countries for the regression modeling. Regression modeling (with fixed and random effects, Hausman test, for 2002–2021 on panel data for countries in which direct causality was confirmed) showed that a one-unit increase in total CO2 emissions from transport (in general and in air transport) is associated with 0.12 and 0.21 decrease in total investments in transport infrastructure. An increase in road CO2 emissions is associated with a 0.49 decrease in road freight transport (ton-km per thousand units of GDP). An increase in CO2 rail emissions is associated with a 0.15 increase in total investments in transport infrastructure and a 0.12 increase in total freight transport.

In modern conditions, the one-sidedness in the economy of Azerbaijan makes it necessary to accelerate the diversification process of the country’s economy. From this point of view, the development of the non-oil sector in the country presents the main priority of the government’s economic policy in Azerbaijan. The purpose of the study is to investigate ways of ensuring the diversification of the national industries in Azerbaijan, which aims to move to a new economic growth model in modern conditions. The study analyzes the economy’s current state and export diversification level in Azerbaijan using the Herfindahl-Hirshman index. As a result of the analysis, the level of diversification in Azerbaijan’s economy and exports was found to be very low (in 2021, the Herfindahl-Hirshman index was 0.23 for the economy and 0.79 for exports). The findings indicate that cooperation between the state and business plays a significant role in increasing the diversification of the economy following the goals of sustainable development of Azerbaijan. On the other hand, it helps stimulate entrepreneurship development in the non-oil sector. One of the ways to solve existing problems in this area is to create Eximbanks to increase the country’s export capabilities of non-oil products. The study offers recommendations to speed up the process of diversification of the economy in Azerbaijan and increase its efficiency.

The article's purpose is to evaluate empirical evidence of the main threats to organic agriculture formation and provide the argumentation of its development prospects in Azerbaijan's current conditions. Questioning of agricultural business owners identified threats and prospects for developing organic agriculture in Azerbaijan. The opportunities and threats for developing organic agriculture are determined and differentiated by groups of entrepreneurs doing business in traditional/organic agriculture. Based on the results of the clustering of the agricultural enterprises depending on the level, the priority of threats, and prospects for development, the strategies for developing organic agriculture in Azerbaijan have been determined: educational strategy of financial accessibility, innovative growth, and infrastructure development.

Research background: The Caspian region with rich hydrocarbons and a favorable location has always been in the attention of researchers. Large oil reserves of the Caspian countries - Azerbaijan, Russia and Kazakhstan - have become an object of interest for world business. These countries have much in common: they were part of a Soviet Union for 70 years. However, during the period of market reforms, the Caspian countries turned out to be uncompetitive in both domestic and foreign commodity markets, the commodity structure of exports was significantly degraded, and its raw orientation increased.Purpose of the article: The main objective of the study is to reveal the problems of diversification of commodity exports of the Caspian countries, a comparative analysis of the structure of their commodity exports in the context of the development of the globalization of the world economy and the intensification of international competition.Methods: We used the methods of comparative analysis of the export structure of Azerbaijan, Kazakhstan and Russia by main product groups, by top-five goods. To determine the level of diversification and export concentration, the Herfindahl-Hirschman index and the export concentration index were used.Findings & Value added: The calculations of the Herfindahl-Hirschman index show a low level of export diversification in these countries, especially in Azerbaijan. The export concentration index showed that the top-five of exported goods are mainly natural raw materials. In the non-oil sector, in all three countries, unproductive and not-tradable sectors: construction, trade and transport prevail.

Research background:Azerbaijan, as a country with rich mineral resources, faces macroeconomic difficulties due to income instability. In 2011-2013, during the period of high world oil prices, Azerbaijan began to diversify the economy and develop the non-oil sector at the expense of oil and gas export revenues. The need to diversify the economy and export has become especially important in the conditions of increased global competition and the integration of the national economy into the world economy.Purpose of the article:The aim of the issue is assessment and study the characteristics of diversification of the economy of Azerbaijan, analyze the dependence of the country’s economic development on the degree of diversification of its economy and exports, assess the level of economic diversification of the country.Methods:To measure the level of diversification, we used indicators such as Herfindahl-Hirschmann export diversification index, and industry concentration in GDP. The originality and value of the research lies in revelation a number of indicators specific to the Azerbaijani economy that affect economic growth based on correlation-regression analysis and other econometric methods. According to econometric characteristics, the resulting model is adequate and confirms the empirical findingsFindings & Value added: The results of the study showed that deeper diversification of the economy is required. To overcome oil dependence and conduct effective economic diversification, it is necessary to develop processing industries, expand the accessibility of small and medium enterprises to financial resources, and stimulate foreign investment in the non-oil sector.