|
on Transition Economics |
| By: | Zhu, Z.; Krug, B. (Erasmus Research Institute of Management (ERIM), RSM Erasmus University) |
| Abstract: | To address the problem why China, as a communist country, moves in the opposite direction when the public sector has undergoing a continuous growth in most Western economies since the World War I, we offer a new approach that the de facto fiscal decentralization curtails government size in transition China according to Leviathan theory. Meanwhile, by combining time series and cross-section regression analysis and various variables used by previous empirical studies, this paper tests the Leviathan hypothesis for vertical decentralization, horizontal fragmentation and intergovernmental collusion at national and provincial level, respectively, based on the new data set of China. Our empirical results not only explain Chinese shrinking government size, but also lend support to Leviathan hypothesis, especially, under the condition of absence of traditional democratic electoral constraint. |
| Keywords: | Leviathan;Fiscal decentralization;China;Transition Economy; |
| Date: | 2005–05–10 |
| URL: | http://d.repec.org/n?u=RePEc:dgr:eureri:30002122&r=tra |
| By: | Orla Doyle; Patrick Paul Walsh (Department of Economics, Trinity College) |
| Abstract: | Many theoretical models of transition are driven by the assumption that economic decision making is subject to political constraints. In this paper we empirically test whether the winners and losers of economic reform determined voting behaviour in the first five national elections in the Czech Republic. We propose that voters, taking stock of endowments from the planning era, could predict whether they would become “winners” or “losers” of transition. Using survey data we measure the percentage of individuals by region who were “afraid” and “not afraid” of economic reform in 1990. We define the former as potential “winners” who should vote for pro-reform parties, while latter are potential “losers” who should support left-wing parties. Using national election results and regional economic indicators, we demonstrate that there is persistence in support for pro-reform and communist parties driven by prospective voting based on initial conditions in 1990. As a result, we show that regional unemployment rates in 2002 are good predictors of regional voting patterns in 1990. |
| Date: | 2005–09 |
| URL: | http://d.repec.org/n?u=RePEc:tcd:wpaper:tep15&r=tra |
| By: | Orla Doyle; Patrick Paul Walsh (Department of Economics, Trinity College) |
| Abstract: | Many theoretical models of transition are driven by the assumption that economic decision making is subject to political constraints. In this paper we empirically test whether the winners and losers of economic reform determined voting behaviour in the first five national elections in the Czech Republic. We propose that voters, taking stock of endowments from the planning era, could predict whether they would become “winners” or “losers” of transition. Using survey data we measure the percentage of individuals by region who were “afraid” and “not afraid” of economic reform in 1990. We define the former as potential “winners” who should vote for pro-reform parties, while latter are potential “losers” who should support left-wing parties. Using national election results and regional economic indicators, we demonstrate that there is persistence in support for pro-reform and communist parties driven by prospective voting based on initial conditions in 1990. As a result, we show that regional unemployment rates in 2002 are good predictors of regional voting patterns in 1990. |
| Date: | 2005–09 |
| URL: | http://d.repec.org/n?u=RePEc:tcd:tcduee:2000515&r=tra |
| By: | Albrecht Kauffmann |
| Abstract: | This paper analyses the structural change in Russia during the transition from the planned to a market economy. With regard to the famous three sector hypothesis, broad economic sectors were formed as required by this theory. The computation of their shares at GNP at market prices using Input-Output tables, and the adjustment of results from distortions, generated as side effects of tax avoidance practices, shows results that clearly reject claims that Russia would be on the road to a post-industrial service economy. Instead, at least until 2001, a tendency of "primarisation" could be observed, that presents Russia closer to less-developed countries. |
| Keywords: | Russian Federation; Deindustrialisation; Natural Resources; Conversion |
| JEL: | O14 O39 P28 H26 |
| Date: | 2005–09 |
| URL: | http://d.repec.org/n?u=RePEc:pot:vwldis:80&r=tra |
| By: | Kirby Faciane |
| Abstract: | This paper focuses on the multinational operations of the largest Russian business units within major economic sectors and analyzes the following: the driving forces behind the Russian companies’ internationalization; international locations of Russian capital outflow; dominant industries within Russian international corporate activities; and the main operational modes. |
| Keywords: | russia; russian investment; foreign direct investment; international corporate investment; international investment; capital budgeting; capital spending; market expenditures; kirby faciane; investment model; investment horizon; banking sector; banking investments |
| JEL: | G G0 G1 G00 G10 G12 G11 G15 G19 G20 G29 G24 G3 G30 G39 G31 G32 E E0 E1 |
| Date: | 2005–09–22 |
| URL: | http://d.repec.org/n?u=RePEc:wpa:wuwpot:0509016&r=tra |
| By: | Kirby Faciane |
| Abstract: | This paper focuses on the multinational operations of the largest Russian business units within major economic sectors and analyzes the following: the driving forces behind the Russian companies’ internationalization; international locations of Russian capital outflow; dominant industries within Russian international corporate activities; and the main operational modes. |
| Keywords: | russia; russian investment; foreign direct investment; international corporate investment; international investment; capital budgeting; capital spending; market expenditures; kirby faciane; investment model; investment horizon; energy sector; energy investments |
| JEL: | G G0 G1 G00 G10 G12 G11 G15 G19 G20 G29 G24 G3 G30 G39 G31 G32 E E0 E1 |
| Date: | 2005–09–22 |
| URL: | http://d.repec.org/n?u=RePEc:wpa:wuwpot:0509014&r=tra |
| By: | Kirby Faciane |
| Abstract: | This paper focuses on the multinational operations of the largest Russian business units within major economic sectors and analyzes the following: the driving forces behind the Russian companies’ internationalization; international locations of Russian capital outflow; dominant industries within Russian international corporate activities; and the main operational modes. |
| Keywords: | oil; gas; gasoline; petrol; petroleum; russia; russian investment; foreign direct investment; international corporate investment; international investment; capital budgeting; capital spending; market expenditures; kirby faciane; investment model; investment horizon; oil sector; oil and gas investments; gasoline; import; imports; exports; export; crude oil; Yukos; |
| JEL: | G G0 G1 G00 G10 G12 G11 G15 G19 G20 G29 G24 G3 G30 G39 G31 G32 E E0 E1 |
| Date: | 2005–09–22 |
| URL: | http://d.repec.org/n?u=RePEc:wpa:wuwpot:0509017&r=tra |
| By: | Kirby Faciane |
| Abstract: | This paper focuses on the multinational operations of the largest Russian business units within major economic sectors and analyzes the following: the driving forces behind the Russian companies’ internationalization; international locations of Russian capital outflow; dominant industries within Russian international corporate activities; and the main operational modes. |
| Keywords: | russia; russian investment; foreign direct investment; international corporate investment; international investment; capital budgeting; capital spending; market expenditures; kirby faciane; investment model; investment horizon; commodities sector; industrial commodity investments; commodities; industrial investments |
| JEL: | G G0 G1 G00 G10 G12 G11 G15 G19 G20 G29 G24 G3 G30 G39 G31 G32 E E0 E1 |
| Date: | 2005–09–22 |
| URL: | http://d.repec.org/n?u=RePEc:wpa:wuwpot:0509015&r=tra |
| By: | Hartmut Lehmann (University of Bologna); Norberto Pignatti (University of Bologna); Jonathan Wadsworth (University of London) |
| Abstract: | We examine the effects of economic transition on the pattern and costs of worker displacement in Ukraine, using the Ukrainian Longitudinal Monitoring Survey (ULMS) for the years 1992 to 2002. Displacement rates in the Ukrainian labor market average between 3.4 and 4.8 percent of employment, roughly in line with levels typically observed in several Western economies, but considerably larger than in Russia. The characteristics of displaced workers are similar to those displaced in the West, in so far as displacement is concentrated on the less skilled. Around one third of displaced workers find re-employment immediately while the majority continues into long-term non- employment. The wage costs of displacement for the sub-sample of displaced workers do not seem to be large. The main cost for displaced workers in Ukraine consists in the extremely long non- employment spell that the average worker experiences after layoff. |
| Keywords: | displaced workers, labor markets in transition, Ukraine |
| JEL: | J64 J65 P50 |
| Date: | 2005–09 |
| URL: | http://d.repec.org/n?u=RePEc:upj:weupjo:05-122&r=tra |
| By: | Patrick Paul Walsh; Peter McGoldrick (Department of Economics, Trinity College) |
| Abstract: | We estimate the productivity dynamics of 680 industrial Chinese State-Owned Enterprises (SOEs) between 1980 and 1994. During this time managerial autonomy over factor markets was introduced. The timing of autonomy varied across SOEs and take-up was an endogenous process: high-productivity SOEs where more likely to take managerial control. We allow for this by adapting an algorithm developed in Olley & Pakes (1996) in order to generate estimates of productivity dynamics that deal with both simultaneity and endogenous selection biases. Apart from offering a methodology to estimate productivity dynamics during endogenous institutional change, we demonstrate that SOEs in China obtained productivity gains from managerial autonomy over factor markets in the years before privatisation. |
| Date: | 2005–08 |
| URL: | http://d.repec.org/n?u=RePEc:tcd:wpaper:tep14&r=tra |
| By: | Campos, Nauro F; Giovannoni, Francesco |
| Abstract: | During the transition from plan to market, managers and politicians succeeded in maintaining control of large parts of the stock of socialist physical capital. Despite the obvious importance of this phenomenon, there have been no efforts to model, measure and investigate this process empirically. This paper tries to fill this gap by putting forward theory and econometric evidence. We argue that asset stripping is driven by the interplay between the firm's potential profitability and its ability to influence law enforcement. Our econometric results, for about 950 firms in five transition economies, provide support for this argument. |
| Keywords: | asset stripping; corruption; law enforcement; transition |
| JEL: | H82 K42 O17 P26 P31 |
| Date: | 2005–09 |
| URL: | http://d.repec.org/n?u=RePEc:cpr:ceprdp:5215&r=tra |
| By: | Olga Kupets (National University "Kyiv-Mohyla Academy", Kiev and IZA Bonn) |
| Abstract: | In recent years there has been much policy discussion of the impact of unemployment benefits and other factors on unemployment duration in developed and transition countries. This paper presents first evidence on the determinants of unemployment duration in Ukraine. Using individual-level data from the first wave of the Ukrainian Longitudinal Monitoring Survey (ULMS -2003), which cover the period 1997-2003, we find no significant effect of benefit receipt on exits from unemployment. However, our survival analysis confirms the hypothesis that income from casual activities or subsidiary farming has strong disincentive effect on the hazard of re-employment in Ukraine. The results also indicate that individual’s age, marital status and gender, the level of education and place of residence are significantly related to the total time spent out of work. The estimates of the baseline hazard parameters do not suggest any marked negative duration dependence. |
| Keywords: | unemployment duration, casual work, transition countries, semiparametric duration analysis |
| JEL: | J64 J68 P23 |
| Date: | 2005–09 |
| URL: | http://d.repec.org/n?u=RePEc:iza:izadps:dp1738&r=tra |
| By: | Patrick Paul Walsh; Peter McGoldrick (Department of Economics, Trinity College) |
| Abstract: | We estimate the productivity dynamics of 680 industrial Chinese State-Owned Enterprises (SOEs) between 1980 and 1994. During this time managerial autonomy over factor markets was introduced. The timing of autonomy varied across SOEs and take-up was an endogenous process: high-productivity SOEs where more likely to take managerial control. We allow for this by adapting an algorithm developed in Olley & Pakes (1996) in order to generate estimates of productivity dynamics that deal with both simultaneity and endogenous selection biases. Apart from offering a methodology to estimate productivity dynamics during endogenous institutional change, we demonstrate that SOEs in China obtained productivity gains from managerial autonomy over factor markets in the years before privatisation. |
| Date: | 2005–08 |
| URL: | http://d.repec.org/n?u=RePEc:tcd:tcduee:2000514&r=tra |
| By: | Arzhenovsky Sergey |
| Abstract: | Factors impacting the initiation and termination of smoking, using Cox's proportional hazard model as the econometric tool, on the basis of RLMS and Goskomstat data on tobacco prices, are being investigated in this paper. The model to explain the amount of consumed cigarettes and the composite model with dependence between quitting and tobacco consumption are constructed. It is shown that the price for cigarettes remains the key factor for the beginning and quitting of smoking; the asymmetric influence of price by sorts of cigarettes is being revealed. The addictive character of cigarettes consumption has been confirmed. Gender and age peculiarities of tobacco products consumption have been revealed, especially for teenagers. Opportunities to reduce smoking have been found out through propagation of a healthy way of life. |
| Keywords: | Russia, duration analysis, smoking, hazard model, consumption habits, amount of cigarettes smoked |
| JEL: | C41 D12 I12 |
| Date: | 2005–09–13 |
| URL: | http://d.repec.org/n?u=RePEc:eer:wpalle:05-12e&r=tra |
| By: | Barry Eichengreen; Mariko Hatase |
| Abstract: | We explore the parallels between Japanese currency policy after World War II and Chinese currency policy today. After two decades of pegging at 360 yen, Japan decoupled from the dollar on August 1971 and then repegged at a revalued rate of 308 yen. After stabilizing the exchange rate at this new level for about a year, greater flexibility was introduced. This phased adjustment - revaluation followed after a time by an increase in flexibility - bears more than a passing resemblance to recent Chinese policy initiatives. We analyze the impact of Japan's exit from its peg on exports and investment. The results point to sizeable effects of the yen's revaluation on both variables, especially investment. While our analysis suggests that a rapidly-growing, export-oriented economy can operate a heavily managed float despite the presence of capital controls and the absence of sophisticated foreign currency forward markets, it underscores the importance of managing the exchange rate with domestic conditions in mind and avoiding the kind of large real appreciation that would sharply compress profits and damage investment. For China this suggests starting with a modest band widening and a limited increase in flexibility, and not with a large step revaluation which could have a sharp negative impact on investment and growth. Our results thus provide support for the kind of measures taken at the end of July. |
| JEL: | F31 F33 N15 N65 |
| Date: | 2005–09 |
| URL: | http://d.repec.org/n?u=RePEc:nbr:nberwo:11625&r=tra |
| By: | A. KARAS; K. SCHOORS |
| Abstract: | We construct a consistent time series of balances and profit and loss accounts for a large cross-section of Russian banks. We describe our data collection and the procedures applied for controlling and aggregating the data. The resulting dataset constitutes a balanced and representative series of financial indicators covering the evolution of the Russian banking system over the last decade and offering great potential for further empirical research. |
| Keywords: | Database, Russian banks |
| Date: | 2005–08 |
| URL: | http://d.repec.org/n?u=RePEc:rug:rugwps:05/327&r=tra |
| By: | G. LANINE; R. VANDER VENNET |
| Abstract: | The Russian banking sector experienced considerable turmoil in the late 1990s, especially around the Russian banking crisis in 1998. The question is what types of banks are vulnerable to shocks and whether or not bank-specific characteristics can be used to predict vulnerability to failures. In this study we employ a parametric logit model and a nonparametric trait recognition approach to predict failures among Russian commercial banks. We test the predictive power of both models based on their prediction accuracy using holdout samples. Both models performed better than the benchmark; the trait recognition approach outperformed logit in both the original and the holdout samples. As expected liquidity plays an important role in bank failure prediction, but also asset quality and capital adequacy turn out to be important determinants of failure. |
| Keywords: | Russian banks, bank failure prediction, logit model, trait recognition, forecasting accuracy |
| JEL: | C25 G21 G33 |
| Date: | 2005–08 |
| URL: | http://d.repec.org/n?u=RePEc:rug:rugwps:05/329&r=tra |
| By: | Oldrich Kyn (Boston University) |
| Abstract: | This is a paper presented at the international symposium on 'Income Distribution and Economic Inequality' in Bad Homburg, West Germany in 1976. This symposium was organized by Zvi Griliches, Wilhelm Krelle, Hans-Juergen Krupp and Oldrich Kyn. The paper compares the empirical evidence on actual income distribution in Czechoslovakia and Poland with normative view of Marxian theory. The original Marxian view on distributive justice is very far from crude egalitarianism. Marx and Engels never argued for absolutely equal incomes of all people. The Marxian principle ‘equal amount of product for equal amount of labor' must necessarily produce quite considerable income differentials. The socialist principle of distribution implies that a person with higher skills should receive a higher wage than a less skilled worker. Marx wrote: 'Socialist equality is ...only the equality of the right to income and not the equality of income. It recognizes no class differences, ... but it tacitly recognizes unequal individual endowments and thus productive capacity as natural privileges'. Marx argued that 'crude communism' called for equality of wages only because it was an expression of 'envy and the desire to reduce everything to a common level' and he added 'it aims to destroy everything which is incapable of being possessed by everyone,' because 'it wishes to eliminate talent etc. by force' and because it 'negates the personality of man in every sphere'. It follows that According to Marx income inequality based on different level of education are justifiable, but income inequality between men and women is not. The empirical data for Czechoslovakia and Poland show that income differentials based on education still persist, although they were at least in Czechoslovakia significantly reduced. In both Czechoslovakia and Poland women have significantly lower incomes than men. |
| Keywords: | Income Distribution, Economic Inequality, Education, Sex Discrimination, Czechoslovakia, Poland, Marxism, |
| JEL: | O P |
| Date: | 2005–09–28 |
| URL: | http://d.repec.org/n?u=RePEc:wpa:wuwpdc:0509024&r=tra |
| By: | Darvas, Zsolt; Szapáry, György |
| Abstract: | This paper analyses the synchronization of business cycles between new and old EU members using various measures. The main findings are that Hungary, Poland and Slovenia have achieved a high degree of synchronization for GDP, industry and exports, but not for consumption and services. The other CEECs have achieved less or no synchronization. There has been significant increase in synchronization of GDP and its major components within EMU. This lends support to the argument of OCA endogeneity but there is also evidence of a world cycle. The consumption-correlation puzzle remains, but its magnitude has greatly diminished in the EMU members. |
| Keywords: | business cycle synchronization; consumption-correlation puzzle; EMU; new EU members; OCA endogeneity |
| JEL: | E32 F41 |
| Date: | 2005–08 |
| URL: | http://d.repec.org/n?u=RePEc:cpr:ceprdp:5179&r=tra |
| By: | Oldrich Kyn (Boston University) |
| Abstract: | Paper presented at St. Antony's College in Oxford in 1965. The Czechoslovak Economic Reform of 1960's was designed on the basis of the new theoretical approach that rejected the incompatibility of planning and market economy and accepted the Convergence Hypothesis. |
| JEL: | O P |
| Date: | 2005–09–22 |
| URL: | http://d.repec.org/n?u=RePEc:wpa:wuwpdc:0509018&r=tra |
| By: | Lechner, Michael; Miquel, Ruth; Wunsch, Conny |
| Abstract: | We analyse the effects of government sponsored training for the unemployed conducted during East German transition. For the microeconometric analysis, we use a new, large and informative administrative database that allows us to use matching methods to reduce potential selection bias, to study different types of programmes, and to observe interesting labour market outcomes over eight years. We find that, generally, all training programmes under investigation increase long-term employment prospects and earnings. However, as an important exception, the longer training programmes are on average not helpful for their male participants. At least part of the explanation for this negative result is that caseworkers severely misjudged the structure of the future demand for skills. |
| Keywords: | active labour market policy; causal effects; gender differences; matching estimation; nonparametric identification; panel data; programme evaluation |
| JEL: | J68 |
| Date: | 2005–08 |
| URL: | http://d.repec.org/n?u=RePEc:cpr:ceprdp:5171&r=tra |
| By: | Sjöholm, Fredrik (European Institute of Japanese Studies); Sjöberg, Örjan (European Institute of Japanese Studies) |
| Abstract: | Cambodia is facing the familiar problem of achieving sustained rates of economic growth that could help it alleviate widespread poverty. Against the background of some encouraging developments, and quite a few that are not equally reassuring, we argue that any push for development needs to consider both agriculture and industry. This is so as both labour absorption, primarily in secondary sector activities, and productivity growth in agriculture are necessary to lift large segments of the population out of the poverty associated with subsistence agriculture, landlessness and informal sector activities. Given that the major success story of the past decade, the garments and textile industry, is under threat, we conclude that Cambodia is yet to achieve an economic take off. |
| Keywords: | Cambodia; economic development; agriculture; industry |
| JEL: | O13 O14 O53 |
| Date: | 2005–04–01 |
| URL: | http://d.repec.org/n?u=RePEc:hhs:eijswp:0209&r=tra |
| By: | Zavkidjon Zavkiev |
| Abstract: | The paper documents constructing a 2001 social accounting matrix for Tajikistan in order to develop a model of the country. As necessary and reliable statistics are difficult to obtain for compiling a social accounting matrix, alternative techniques and approaches have been used to extend, create and calculate the data set. A consistent and balanced 2001 social accounting matrix has been achieved using Kuroda's Method. The constructed 2001 social accounting matrix consists of 74 accounts with 27 commodities accounts, 2 factors of production, 3 institutions, 11 tax accounts, 1 non-tax payments account, 1 subsidies account, 1 capital account and 1 rest of the world account. As construction of a social accounting matrix for Tajikistan has not yet received attention in the literature this paper will fill that gap. |
| JEL: | C60 C67 C81 |
| Date: | 2005–09 |
| URL: | http://d.repec.org/n?u=RePEc:pas:camaaa:2005-0x&r=tra |
| By: | Söderberg, Marie (European Institute of Japanese Studies) |
| Abstract: | Peace building and peace preservation are new key concepts in Japanese foreign aid policy. According to the revision of the ODA charter in 2003, the objective of Japan’s foreign aid is to contribute to the peace and development of the international community, and thereby to help ensure Japan’s own security and prosperity--“Japan aspires for world peace. Actively promoting the aforementioned effort with ODA” that Japan will carry out “even more strategically” in the future. Asia and especially East Asia is pointed out as a priority region. North Korea, with whom Japan has not yet normalised its relations, is one of Japan’s closest neighbours and would, from a logical point of view, then seem like an important starting point. However, when main Japanese aid agencies such as JICA (Japan International Co-operation Agency) and JBIC (Japan Bank of International Co-operation) are asked, no one works officially with aid to North Korea. The standard answer is that there is no aid to that country, besides some smaller amounts of Japanese humanitarian aid that are channelled through multilateral organisations. If Japan regards aid as one of its main tools for creating peace, why isn’t aid provided to North Korea? Aid is a very complex issue and not giving is often regarded as effective as giving, when it comes to getting concessions and changes in the recipients’ policy behaviour. It is used both as a carrot and a stick. Aid is always envisioned as something quite plausible, if North Korean policy behaviour is changed for the better according to Japanese judgement (so called positive aid sanction); but aid is never paid out and remains an illusion as long as it does not change (negative sanction). But the question for Japan is more complex than this. There are various domestic opinions and interest groups that have to be taken into consideration. The kidnapping issue (Japanese citizens kidnapped by North Korea in the 1970s) has lead to a considerable amount of anti-North Korean sentiment that makes it difficult for the Japanese government to disperse aid to North Korea. There is also foreign pressure at work; the US, Japan’s military ally, and other western countries as well have imposed economic sanctions on North Korea due to its withdrawal from the nuclear non-proliferation treaty. This also affects the Japanese position on the aid question. Keeping all these factors in mind, this paper questions if Japanese foreign aid is an effective tool to influence North Korean policy behaviour. Has it ever led to a change of behaviour? Has it contributed to peace and stability in the area in any way? |
| Keywords: | Japanese politics; Japan-North Korea; Japanese ODA policy |
| JEL: | H56 O20 R58 |
| Date: | 2005–09–16 |
| URL: | http://d.repec.org/n?u=RePEc:hhs:eijswp:0210&r=tra |