Gaukhar Uvakbayeva

Type of the article: Research Article

Abstract
Money laundering threatens global financial integrity, while digital governance is increasingly seen as a tool to enhance transparency and regulatory capacity. This study operationalized digital governance through the United Nations E-Government Development Index, which captures the scope and quality of online public services, telecommunications infrastructure, and human capital. The paper aims to examine whether improvements in e-government development are associated with measurable reductions in systemic money-laundering vulnerabilities at the country level. The study uses an unbalanced panel of 171 countries for 2012–2024 (982 observations). Fixed- and random-effects models with Box–Cox transformations were estimated, with the Hausman test guiding model selection and cluster-robust and Driscoll–Kraay standard errors ensuring reliable inference. The results demonstrate a statistically significant and economically meaningful inverse relationship between e-government development and money-laundering risk, measured by the Basel AML Index. In the preferred fixed-effects specification, the coefficient on the transformed EGDI is –1.56 (p < 0.001), indicating that within-country improvements in digital governance capacity are associated with substantial reductions in AML vulnerability over time. This effect remains robust across alternative error structures, with 95% confidence intervals of [–1.96, –1.17] under cluster-robust estimation and [–1.75, –1.38] under Driscoll–Kraay correction. The inclusion of country-specific fixed effects reveals considerable structural heterogeneity in baseline AML risk (approximately 1.15–3.90), while time effects display limited variation over the sample period (approximately 2.11–2.19), confirming that the risk-reducing role of digital governance is not driven by specific countries or particular years.

Acknowledgment
This article was prepared based on the results of a study funded by the Ministry of Education and Science of Ukraine, “GovTech for Ukraine: A Digital, Secure, Transparent, and Equitable State in Times of War and Post-War Reconstruction” (registration number: 0126U000544).

Type of the article: Research Article

Abstract
Weak risk governance and legacy non-performing loans have repeatedly destabilized banks in emerging markets, making the payoff from regulatory strengthening of internal control and internal audit a first-order policy question. This study aims to determine whether Kazakhstan’s 2019 risk-management and internal control requirements (National Bank Resolution No. 188), whose core assurance mechanism is a strengthened internal audit function, improved the financial stability of the country’s commercial (second-tier) banks, and to identify the channel of this effect. The analysis applies a continuous-treatment difference-in-differences design to an annual panel of 37 banks over 2015–2025 (287 bank-years), interacting each bank’s pre-intervention (2016–2019) weakness with the post-intervention period and measuring stability by the log Z-score. The results show that the stabilizing effect is concentrated in the asset-quality channel: banks that entered the post-2020 period with a one-standard-deviation greater non-performing-loan weakness recorded a 0.38-0.41 log-point (roughly 40-50%) larger post-intervention increase in the Z-score (p < 0.01), whereas composite pre-intervention weakness yields no robust effect under any weighting scheme. The effect emerges with a multi-year lag, becoming statistically detectable only toward the end of the sample period, and operates through capital rebuilding. Because pre-intervention weakness strongly predicts market exit (Cox hazard ratio ≈ 3.95), the estimates are a lower bound on the intervention’s full association with sector stability. The findings imply that supervisors should target credit-risk governance, loan classification, timely recognition of problem loans, and provisioning, where strengthened internal control and audit yield the largest stability gains.

Type of the article: Research Article

Abstract
Transition economies combine large informal sectors with constrained fiscal capacity, and many have turned to digital tax administration to raise revenue and curb informality. This study assesses digital tax administration as a fiscal-governance innovation in 25 transition economies, asking whether it increases corporate tax revenue and reduces the informal economy, and whether these effects are linked. Using a balanced annual panel for 2008–2022 (375 country-years) and fixed-effects models, it proxies digital administration by the United Nations Online Service Index – a broad measure of digital-government maturity – and tests mediation between revenue and informality. A higher Online Service Index is robustly associated with higher corporate tax revenue (β = 0.89, p < 0.01) – an increase of about 0.89 percentage points of GDP, roughly 41% of the sample mean – that holds across alternative specifications including two-way fixed effects, alternative constructions of the index, and sub-periods. Its association with a smaller informal economy (β = −3.62, p < 0.05) is fragile: it is concentrated in the pandemic years 2020–2021, turns insignificant once they are excluded (β = −1.54, p = 0.12), and does not survive two-way fixed effects or all alternative informality measures. An exploratory decomposition finds no evidence that this association runs through corporate tax revenue: the indirect path is insignificant (about 16% of the total effect), indicating parallel rather than sequential channels. Digitalizing tax administration is associated with a reliable corporate-revenue dividend, whereas the informality association is conditional, pandemic-bound, and does not operate through tax revenue.

Acknowledgment
This article was prepared based on the results of a study funded by the Ministry of Education and Science of Ukraine entitled “GovTech for Ukraine: A Digital, Secure, Transparent, and Equitable State in Times of War and Post-War Reconstruction” (registration number: 0126U000544).

Type of the article: Research Article

Abstract
Between 2005 and 2024, the digital divide separating former Soviet economies outside the EU from EU member states shrank from 44.8 to 2.4 points of a composite 0–100 index, and whether banking systems converted this catch-up into better performance is an open question. The paper evaluates the intermediation efficiency and productivity of banking in 24 transition economies during 2010–2024 and quantifies their relationship with digital infrastructure, paying special attention to Armenia, Kazakhstan, and Ukraine. Efficiency is measured with input-oriented window DEA on deposit funding, operating costs, lending, and profitability; productivity with Malmquist indices; and digital infrastructure with a principal-component index of internet, mobile, and broadband penetration. The estimation relies on two-way fixed effects with Driscoll-Kraay and bootstrap inference on 356 country-year observations. Productivity is flat overall with a Malmquist mean of 0.995, yet technological change moves from below unity through 2015 to above unity in 2016–2023, a regime shift robust to the output set and the translation constant. Within countries, the index is unrelated to efficiency levels, productivity growth, cost efficiency, and stability outcomes; the baseline cost-to-income and credit-risk associations dissolve under country-specific trends and differencing. Cumulative productivity reaches 1.162 in Kazakhstan and 1.106 in Armenia by 2024, while Ukraine climbs back to 0.856. Frontier renewal after 2016, rather than a measurable dividend from connectivity, is the substantive finding, and expectations of direct efficiency or stability gains from digital infrastructure should remain modest, particularly in postwar Ukraine.