The Role of Monetary Policy in Pursuing Economic Activity in Selected Transition Countries

The process of transition has brought an urgent need to develop many new market-oriented institutions or in some cases to reconstruct existing ones. One of the most important institutions of western-type economies is a central bank. It fulfils several "public good" functions, the most important of which are the achievement of stable price levels and assuring the financial stability of the economy. Nevertheless, even in economies with a long-standing market tradition, the question of whether a central bank is able to stimulate economic activity or whether all its cyclical actions lead only to changes in price levels remains open. The main purpose of this analysis was to empirically prove or disprove the relation between monetary policy and economic activity in more advanced transition countries. Basing his findings on commonly used econometric methods (causality tests, VAR modelling and simulations, simultaneous equations models), Delakorda concludes that the relation between money and economic activity is a mutual one, as there are significant differences between different countries in the conduct of monetary policy and in the environment of central banks. It is the latter which determines the relation between money and economic activity.

Changes in Psychological Characteristics of Working Adults in Different Stages of Economic Transition in Lithuania

Global economic changes have psychological consequences and Mr. Lepeska set out to assess these changes in working adults in Lithuania between 1993 and 1997. He surveyed two groups of working adults, with a total of 200 people, randomly selected and representing different organisations and professions. In both groups around 30% of participants were managers, with the remainder working in non-managerial positions. The participants were surveyed twice, once in 1993 and the second time in 1997,using various psychodiagnostic tools to measure their psychological characteristics. The results showed that strategies for coping with stress have changed, with problem solving strategies being used more often, and avoidance behaviour or seeking social support less. Men tended to have rejected these strategy more radically than women. Attitudes towards work had become more positive, with managers' attitudes having changed more significantly than those of employees from lower levels of organisations. Younger people were more positive towards work-related changes, while situational anxiety tended to increase with age, although overall it remained low. Mr. Lepeska found that while there were some indications of an increasing individualist in relation to peers, the traditional collective orientation of Lithuanian adults had if anything increased. People have become more accepting of an unequal distribution of power, making it difficult to increase the participation of subordinates in decision making. He also noted a tendency for Lithuanians to see their organisations as traditional families, expecting them to take care of them physically and economically in return for loyalty. The strong feminine orientation with its stress on interpersonal relations and overall quality of life has also strengthened, but the ability of Lithuanians to take initiative and control their environment was relatively low. Mr. Lepeska concludes that organisations should seek to recruit people who are able to adjust more easily to changes and consider measuring dominance, individualism, and attitudes to work-related change and situational anxiety in the process of professional selection. There should also be more emphasis on team building and on training managers to maintain closer relationships with their subordinates so as to increase the latter's participation in decision making. Good interpersonal relations can be a strong work motivator, as may be special attention to the security needs of older employees.