Economic Review: Journal of Economics and Business

THE INFLUENCE OF PSYCHOLOGICAL AND CULTURAL FACTORS ON THE DEVELOPMENT OF HUMAN CAPITAL IN THE DIGITAL ECONOMY

Nedžad Pirić — 2026-07-22

The research examines the impact of psychological and cultural factors on human capital development in the context of the digital economy in Bosnia and Herzegovina. While access to infrastructure and accessibility of information and communication technologies (ICT) remain key, the research findings highlight that attitudes, perceptions, and cultural factors significantly shape digital adoption and skills acquisition. The survey results show that barriers such as lack of confidence, fear of technology, and limited perceived needs are significant obstacles to full participation in the digital economy, even when basic infrastructure is present. Regression analysis confirmed that psychological and cultural factors have a statistically significant impact on human capital development, explaining a significant part of the variance in outcomes. The presented results highlight that digital transformation cannot be reduced to a purely technical challenge but must also address the human and cultural dimensions of technology use. Policies that combine infrastructure investments with programs designed to build trust, build and change perceptions, and align digital tools with local cultural practices will be most effective in reducing the digital divide and strengthening human capital for future growth. The research sample consisted of 1547 citizens (n = 1547) from Bosnia and Herzegovina, selected using the snowball sampling method. The basic motive for the realization of this research is the fact that there are no relevant studies in Bosnia and Herzegovina that focus on the influence of psychological and cultural factors on human capital in the digital economy.

DRIVING KNOWLEDGE MANAGEMENT IN INDUSTRIAL FIRMS: ORGANIZATIONAL CULTURE, STRATEGIC LEADERSHIP, AND THE ALGERIAN CONTEXT CASE STUDY OF MAGHREB PIPE COMPANY FOR THE MANUFACTURE OF GIANT PIPES IN ALGERIA

Abderrahim Boudjellal — 2026-07-22

This research aims to examine the impact of organizational culture on knowledge management processes, highlighting the mediating role of strategic leadership in supporting this relationship. The field study was conducted at Maghreb Pipe, a company in Algeria that manufactures metal and plastic pipes. To answer the research questions and test the hypotheses, a descriptive-analytical approach was employed, with a sample of 321 employees from the company. Statistical analysis was conducted using AMOS.v24. The findings revealed a significant positive direct impact of organizational culture on the activation of knowledge management processes, along with a partial mediation of strategic leadership in supporting this relationship at the company studied.

SUSTAINING SUCCESS BEYOND THE FOUNDER: A SYNERGISTIC FRAMEWORK OF AUTHENTIC LEADERSHIP AND SELF-DETERMINATION THEORY

Hemchandra Betchoo — 2026-07-22

Purpose: This paper analyzes leadership evolution at Infosys (global IT leader) and its impact on organizational culture and employee motivation. It identifies challenges from the firm's foundational leadership model and proposes an integrated framework that connects Authentic Leadership and Self-Determination Theory (SDT) to address motivational and cultural deficits in a mature, founder-influenced technology firm.

Methodology/Approach: The study employs a qualitative documentary case study design. The 49-document evidence corpus was assembled through a systematic search of EconBiz and ProQuest databases supplemented by purposive grey literature sampling. Corpus assembly is documented using PRISMA-adapted screening procedures to ensure selection transparency. A two-cycle thematic coding procedure mapped emergent categories onto the Competing Values Framework (CVF), Schein's cultural layers, authentic leadership constructs and SDT's basic psychological needs with two-level triangulation applied throughout.

Findings: Infosys's transformational leadership model drove early success but documentary evidence is consistent with a persistent gap between Clan-oriented espoused values and Hierarchy-driven operational practices. This cultural tension shows patterns consistent with SDT predictions about need-thwarting of autonomy, competence and relatedness.

Implications for theory and practice: The study contributes a three-level theoretical chain absent from existing literature: authentic leadership behaviors reduce the CVF clan-hierarchy gap, which satisfies SDT's basic psychological needs and restores intrinsic motivation. For practitioners, the framework specifies behavioral changes at senior and middle-management levels within a structured three-phase implementation sequence.

Originality and value: Existing scholarship addresses authentic leadership, CVF cultural typologies, and SDT as separate domains. This study connects all three into a single diagnostic framework, derives context-sensitive propositions for leadership evolution in founder-influenced technology firms, and specifies those propositions for longitudinal mixed-methods testing.

FISCAL IMPLICATIONS OF NATIONAL EMISSIONS TRADING SYSTEM (ETS) AND DECARBONIZATION IN BOSNIA AND HERZEGOVINA

Edina Sudžuka — 2026-07-22

This paper examines the effects of national Emissions Trading System (ETS) implementation within the framework of the existing fiscal system in Bosnia and Herzegovina (BiH) from the perspective of economic analysis of law. Existing studies analyze the effects of the Carbon Border Adjustment Mechanism (CBAM) on foreign trade and the competitiveness of exporters in BiH, but there is a lack of studies and empirical research on the effects of ETS and CBAM on fiscal stability and on qualitative and quantitative structure of public revenues. Furthermore, most of the studies conducted by the public sector are not publicly available apart from certain results and estimations on CBAM/ETS revenues. However, these studies do not consider the effects of domestic ETS introduction on other existing fiscal revenues and public expenditures. As a result, there is a lack of theoretical basis for further empirical studies on fiscal effects across different administrative levels. This paper examines the influence of ETS and National Energy and Climate Plan (NECP) on public revenues, taxation, and public expenditures in BiH to ensure fiscal stability in the short and medium-term upon domestic ETS implementation. The present analysis contributes to understanding the interconnected determinants of the fiscal system, the causal relationship between the qualitative and quantitative structure of public revenues and expenditures on the one side, and decarbonization as imposed standard in modern climate and energy policies on the other. The discussion of the results of the conducted analysis and considerations for future empirical research on individual segments of the analysis are included in the paper, together with certain political and security considerations in the existing geopolitical landscape.

DETERMINANTS OF FOREIGN DIRECT INVESTMENT (FDI) IN THE WESTERN BALKAN COUNTRIES: A PANEL DATA AND THE VECTOR ERROR CORRECTION MODEL (VECM) APPROACH

Vesna Georgieva Svrtinov — 2026-07-22

This study analyses the factors influencing Foreign Direct Investment (FDI) inflows in the Western Balkan countries, which share a history of political instability and economic transition. The research uses panel data analysis, fixed-effect models, and Vector Error Correction Models (VECM) to examine macroeconomic, institutional, political, market, operational, and infrastructural factors affecting FDI inflows in these countries. The findings reveal that a fixed exchange rate regime positively impacts FDI while maintaining macroeconomic stability, improving regulatory frameworks, and enhancing credit to the private sector, crucial for attracting FDI. Additionally, government effectiveness significantly boosts FDI inflows, underscoring the importance of strong governance. The analysis indicates no long-run causality among the variables but significant short-run causality from all analyzed variables to FDI inflows. These insights contribute to the existing literature by highlighting region-specific factors and offering policy recommendations to improve the investment climate in the Western Balkans.

WHY CORPORATE GOVERNANCE IN CROATIAN SOEs MIGHT NOT REACH HIGH-PERFORMANCE EQUILIBRIUM DESPITE THE INSTITUTIONAL REFORM EFFORTS: THE CASE STUDY OF THE ENERGY SECTOR

Davorin Pavelić — 2026-07-22

Croatia has substantially reformed the governance framework for its state-owned enterprises (SOEs), through the 2021 Government Action Plan and through the 2025 Law on Legal Entities Owned by the Republic of Croatia. The goal of this paper is twofold. The first goal is to show that, while these reforms address procedural and internal governance aspects, the structural drivers of agency loss remain only partially addressed. Drawing on agency theory, transaction cost economics, multi-principal political economy, and the logic of institutional complementarity, we show that the current framework is missing four key conditions, i.e., hard budget constraints, clear mandates, coordination across government levels, and market-based financing. As a result, the level of public ownership remains high compared to the OECD countries. The second objective is to show that the most likely long-term outcome is a stable but politically mediated equilibrium of moderate compliance, inefficiency, and recurring fiscal exposure. This is discussed in a case study of five SOEs in the Croatian energy sector over 2018–2024. In doing so, we combine an institutional assessment of the reforms with a structured analysis of the selected firm-level financial performance.