The Economics Research Centre (CypERC) produces rigorous analyses on issues of the Cypriot economy using novel and state-of-the-art methodologies and building upon the in-depth institutional knowledge of the local economy the Centre has acquired over the years. The analyses produced at the Centre are communicated to a wide range of audiences, including the scientific and business community, governmental organisations, NGOs, trade unions and the media.  Research activities are divided into the following sectors:

Microeconomic and welfare analysis

The sector analyses topics regarding the economic welfare of households, the role of the state and productivity.  Topical issues which are currently on the research agenda of the sector include the impact of social policy, the public-private pay gap in Europe, the effects of the tax system on differences in labour supply outcomes across countries, competitiveness and the construction of productivity indicdes for the Cypriot economy.  The responsibilities of the sector also include the maintenance and updating of the tax-benefit microsimulation model for Cyprus which is part of the European model EUROMOD and the coordination of the field research conducted for the collection of data for individuals aged 50 and over as part of the European research project SHARE. The research outcomes of the sector address a wide audience including academics, researchers and policy makers and are published in the CypERC Economic Policy/Analysis Papers, in peer-reviewed academic journals or as policy reports.

Macroeconomic Forecasts and Analysis

The sector focuses on the development of models/tools for macroeconomic analysis of the Cypriot economy and the construction of forecasts for macroeconomic indicators, both at the aggregate and sectoral level. Details about the methodologies employed for macroeconomic analysis and forecasting are published in the Economic Analysis/Policy Papers series of the Centre.

GDP growth and inflation forecasts are published on a quarterly basis along with an analysis of recent developments and outlook for the Cypriot economy in the bulletin Economic Outlook.

Moreover, the sector coordinates the programme for the measurement of economic confidence in Cyprus via the conduct of surveys among business executives in different sectors of the economy, and among consumers. Business and Consumer Surveys in Cyprus are carried out within the framework of the Joint Harmonised EU Programme of Business and Consumer Surveys. The Surveys record business executives' and consumers' perceptions of current economic conditions as well as their expectations concerning the evolution of economic variables. The results of the Surveys are published on a monthly basis in the bulletin Business and Consumer Surveys.

Research in the above two sectors is partially sponsored by the Central Bank of Cyprus, the European Union and the Ministry of Finance.


This field of research at CypERC was pursued under the project "Employment in Europe" funded by the European Research Council (Advanced Grant) for the period 2013 - 2018 and coordinated by the Nobel Laureate Prof C. Pissarides. It focused on the study of employment and unemployment in Europe and examined issues such as: job creation by sector; wage inequality; public sector employment and wage subsidisation relative to the private sector; the compatibility of welfare state with EU targets for employment and the number of jobs vis-à-vis the hours worked for each job.

Project team members at CypERC: Vasiliki Bozani (PhD in Economics, University of Crete), Robert-Duval Hernandes (PhD in Economics, Cornell University, Neophyta Empora (PhD in Economics, University of Cyprus), Chrystall Kapetaniou (PhD in Management, University of Kent), Georgia Katsifaraki (Master in Business Administration, University of Cyprus), Paris Nearchou (PhD in Economics, University of Cyprus). 

Other Research Projects

Research Grant category «Research Hubs» of the research program RESTART 2016-2020 with title «Mixed Data Sampling (MIDAS) models: Theory and Applications» funded by the Research Promotion Foundation. Research Coordinator: Prof. Elena Andreou

The objective of the proposed project is twofold. The first objective is to develop novel econometric models that extend current state-of-the-art techniques for modelling the dynamic behaviour of economic time series which are useful in macroeconomic forecasting as well as economic policy making. The new models apply the Mixed Data Sampling (MIDAS) idea to develop further Factor type models with mixed frequencies which have broad applications in macroeconomics and financial economics. The second objective is to develop novel econometric techniques for evaluating and monitoring financial indicators and structural changes which are useful in periods of financial distress and economic crises, and which can be early warning indicators of instability in economies. These techniques will develop sequential change-point tests which test on-line, with the arrival of new data, the stability of economic indicators, capitalizing on the mixed frequencies and properties of financial variables in producing early warning indicators of financial distress in economies or financial institutions. Forecasting and monitoring key economic variables is one of the main activities of financial and government institutions, economic forecasting agencies, investment companies and is useful to economic policy makers.

Research Grant category "DIDAKTOR" of the research program RESTART 2016-2020 with title "Dynamic consumer behavior in car ownership" funded by the Research Promotion Foundation. Research Coordinator: Prof. Sofronis Clerides

Understanding consumer behavior is an important task of economics. An automobile is the largest item most individuals will ever purchase (besides a home), hence economists have dedicated much effort in analyzing the factors that determine automobile purchase decisions. One of the limitations of existing research is that it relies primarily on aggregate data as there is no information on consumers’ purchasing patterns over their lifetime. The proposed project aims to make a contribution to the literature by exploiting a unique dataset that records every vehicle registered in Cyprus since 1970. As of 1987, the dataset also records transfers of ownership and an identification number for the vehicle’s owner. Thus we can track every vehicle’s entire ownership history and each individuals' automobile holdings over time. A comprehensive descriptive analysis of this unique dataset will provide valuable insights into consumer behavior in durable good markets and will inform the development of tractable but also realistic dynamic models of consumer behavior.

Research Grant of the research program RESTART 2016-2020, International Collaborations Dual Targeting with title "Group Factor Models" funded by the Research Promotion Foundation.  Research Coordinator: Prof. Elena Andreou

This project will develop novel models, tests and tools for Group Factor models to analyze big data of different categories/classes and/or of different sampling in order to provide new results in econometric theory and macro/finance applications which are useful for economists and economic policy makers. The project aims at establishing a strong research team between universities and financial institution policy makers Cyprus and the USA. The research project is funded by the Research Promotion Foundation (RESTART 2016-2020, International Collaborations Dual Targeting). The Principal Investigator of the project is Professor Elena Andreou.

Research Programme "Composite Leading Indicator" funded by the Hellenic Bank, Research Coordinator: Prof. Elena Andreou

The Composite Leading Indicator (CLI) or Leading Economic Index (LEI) for each country is one of the key indices monitored internationally by economists, policy makers, financial organizations and the public, since it provides leading information about the state of the economy. The CLI/LEI is an index designed to provide early signals of turning points in business cycles showing fluctuation of the economic activity around its long term potential level. State-of-the-art econometric techniques will be applied in order to develop a CLI/LEI index for the Cyprus economy comparable with the corresponding indicators in other countries. The research project is funded by Hellenic Bank.

Research Grant of the Marie Sklodowska-Curie Individual Fellowships (SOCIENTITY_PR, Grant agreement: 894128) "The Role of Social Identity on Preferences for Redistribution". Supervisor: Associate Professor Andros Kourtellos, Researcher: Dr. Kyriakos Petrou 

The goal of the action is to understand and uncover the role of social identity on the formation of preferences for redistribution. The fellowship entails the mobility of the researcher to the University of California, Los Angeles for 24 months and his return to the University of Cyprus for 12 months. The research objectives of the proposed research are twofold: (1) Investigate the effect of social identity on preferences for redistribution and (2) Investigate the existence of multiple regimes and parameter heterogeneity on preferences for redistribution. The fellowship will result in high-quality research and targeted policy papers to eliminate several negative social phenomena impacting the academic community, the Cypriot and European policymakers, and the general public.  

In addition to the five areas listed above, research at CypERC is further diversified through the study of specialised topics, such as long term energy planning in Cyprus, the evolution of car ownership in Cyprus, determinants of bank lending standards in Cyprus, technological progress, trade and conflict.

Research Grant "SInnoPSis" of the research program H2020-WIDESPREAD-2018-2020 with title "ERA Chair in Science and Innovation Policy & Studies" funded by Horizon2020. Research Coordinator: Prof. Zacharias Maniadis 

The challenge of understanding the processes of research and innovation requires strong interdisciplinary collaboration. The ERA Chair in Science and Innovation Policy & Studies aims to tackle this important challenge by bringing to UCY an interdisciplinary research team with the purpose of conducting cutting-edge research and facilitating cross-fertilization between departments. The focus of research is on understanding research institutions and the incentives they engender.  SInnoPSis will evolve into a highly international and outward-oriented research unit, organizing interdisciplinary activities that will enhance networking and international collaborations. 

Research Grant for an "Economic Policy Modelling Hub- Cyprus Recovery and Resilience Plan 2021-2026". Research Coordinator: Prof. Elena Andreou

The project aims at developing current state-of-the-art models/tools for the evaluation and impact of economic policies/reforms which are important for the public sector and other organizations for policy-making as well as the monitoring of policies and new growth models.

The investment will be comprised of 3 actions:

  • Action 1: Economic Policy Modelling Hub at the Economics Research Centre: New Models, Tools and Data for Economic Policy Analysis and Evaluation
  • Action 2: Transfer knowledge and training of public sector employees at the Ministry of Finance. Upgrade the public sector tools and skills for economic policy analysis and evaluation (e.g. economic impact assessments, economic evaluation and monitoring of reforms)
  • Action 3: Development of big data and data analytics (collection and linkages of different databases in collaboration with the government) for informing and monitoring economic policies, especially in real-time, also useful for modelling, nowcasting and forecasting.

Additional information for the project and the Cyprus Recovery and Resilience Plan can be found at: Cyprus Recovery and Resilience Plan 2021-2026

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