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<p>This paper evaluates the impact of the Ukraine conflict-induced crisis on firms in North Macedonia using data from a survey conducted with 112 firms in April and May 2023. Through descriptive statistics and probit regression analysis, we find that small firms in low-wage sectors predominantly coped with the crisis by raising prices of final products and services, followed by cost-cutting measures. Larger firms tended to invest in self-electricity generation or energy-saving equipment. Our results show that firms with higher energy cost shares increased final prices more but experienced decreased competitiveness. Firms not addressing rising costs did not consistently pass these costs onto prices or maintain competitiveness, except for labor costs. Labor cost increases, such as from minimum wage hikes, may lead to cost-push inflation unless firms absorb these costs at the expense of profits.</p>
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This paper evaluates the impact of the Ukraine conflict-induced crisis on firms in North Macedonia using data from a survey conducted with 112 firms in April and May 2023. Through descriptive statistics and probit regression analysis, we find that small firms in low-wage sectors predominantly coped with the crisis by raising prices of final products and services, followed by cost-cutting measures. Larger firms tended to invest in self-electricity generation or energy-saving equipment. Our results show that firms with higher energy cost shares increased final prices more but experienced decreased competitiveness. Firms not addressing rising costs did not consistently pass these costs onto prices or maintain competitiveness, except for labor costs. Labor cost increases, such as from minimum wage hikes, may lead to cost-push inflation unless firms absorb these costs at the expense of profits.

The Impact of the Crisis Induced by the Conflict in Ukraine on Firms: Evidence from North Macedonia

South East European Journal of Economics and Business

This work is licensed under the Creative Commons Attribution-NonCommercial-NoDerivatives 4.0 International License.

This paper evaluates the impact of the Ukraine conflict-induced crisis on firms in North Macedonia using data from a survey conducted with 112 firms in April...

The Impact of the Crisis Induced by the Conflict in Ukraine on Firms: Evidence from North Macedonia

Published Online: Jun 29, 2024

Page range: 123 - 144

DOI: https://doi.org/10.2478/jeb-2024-0009

Keywords
crisis, firm costs, firm competitiveness, North Macedonia

© 2024 Marjan Petreski, published by Sciendo

This work is licensed under the Creative Commons Attribution-NonCommercial-NoDerivatives 4.0 International License.

The Impact of the Crisis Induced by the Conflict in Ukraine on Firms: Evidence from North Macedonia

Published Online: Jun 29, 2024

Page range: 123 - 144

DOI: https://doi.org/10.2478/jeb-2024-0009

Keywordscrisis, firm costs, firm competitiveness, North Macedonia

© 2024 Marjan Petreski, published by Sciendo

This work is licensed under the Creative Commons Attribution-NonCommercial-NoDerivatives 4.0 International License.

Keywords
crisis, firm costs, firm competitiveness, North Macedonia