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on Transition Economics |
| By: | Eamets, Raul (University of Tartu) |
| Abstract: | The purpose of the paper is to analyse how labour market and labour market institutions reacted during recent crises. In early 1990s Estonia introduced a set of rather unique policy options like currency board as a ground for monetary policy, low taxes, open foreign trade policy, low public sector debts, annually balanced state budget etc. These measures caused very limited options to implement both monetary and fiscal policy. Macroeconomic adjustment will take place in such situation through the labour market. In the case of Estonia, we can observe a very high labour market flexibility, which played a crucial role in recent economic recession. The measures taken included a reduction of nominal wages, working hours and redundancies among employees. This indicates that the traditional institutional factors that protect workers and also could decrease the flexibility of the labour market, such as labour market regulation, social protection and union activities, are not very well developed in Estonia and do not have a significant effect on the outcomes of the labour market. The labour market reform was launched in Estonia in 2009. The main idea of the New Employment contract was that the termination of employment relations became less expensive for employers. Although empirical evidence show that the Employment Contracts Act entered into force at a time when most lay-offs had already been effected. |
| Keywords: | labour policy, Estonian labour market, labour market flexibility, labour market and recession |
| JEL: | J08 J21 J50 J63 |
| Date: | 2013–05 |
| URL: | http://d.repec.org/n?u=RePEc:iza:izapps:pp60&r=tra |
| By: | Rumen Dobrinsky |
| Abstract: | SummaryThe paper undertakes an empirical analytical assessment of some of the determinants of economic growth in the EU during the past decade, with a specific focus on the Central and Eastern European (CEE) members of the EU. The methodology is based on a combination of different statistical methods and techniques including descriptive statistics and stylised facts as well as some widely used empirical models of growth, including the testing of convergence hypotheses and running panel growth regressions. During the decade prior to the global economic and financial crisis, the growth model in the EU was disproportionately skewed towards the attraction and mobilisation of additional resources as compared to the reliance on structural supply-side factors. In particular, EU growth on average was extremely finance-dependent and debt-intensive. The ensuing debt crisis in the euro area rejected this growth model on the grounds of its unsustainability. The current debt overhang implies that countries (both governments and businesses) will have to learn to live with less resources (in the first place financial) at their disposal. Thus one of the key factors for invigorating future growth could be raising the efficiency of resource utilisation, including the utilisation of public funds. Growth in the CEE countries was also finance-dependent and debt-intensive but, on average, not to the extent observed in the older EU Member States. CEE economies relied on improvements in structural supply-side factors such as productivity, innovation and competitiveness to a larger degree than was the case in the older EU members. Thus CEE countries may have a larger degree of policy freedom to deal with the implications of the crisis.The paper also addresses some policy issues related to the possible invigoration of economic growth in the EU and, in particular, in CEE. It suggests that one of the areas of policy reforms that could invigorate growth is that targeting improvements in the efficiency of financial intermediation and more efficient allocation of financial resources. The paper also discusses some supply-side structural measures that appear to be especially pertinent to the CEE economies. |
| Keywords: | economic growth, growth determinants, real convergence, global economic and financial crisis, European Union, Central and Eastern Europe |
| JEL: | C21 C23 O40 O52 |
| Date: | 2013–02 |
| URL: | http://d.repec.org/n?u=RePEc:wii:rpaper:rr:385&r=tra |
| By: | Tamar Khitarishvili |
| Abstract: | Following the financial crisis of 2008, transition countries experienced an increase in female labor force participation rates and a decrease in male labor force participation rates, in part because male-dominated sectors were hit the hardest. These developments have prompted many to argue that women have been spared the full-blown effects of the crisis. In this paper, we critically evaluate this claim by investigating the extent to which the increase in the female labor force participation rate may have reflected a distress labor supply response to the crisis. We use the data on the 28 countries of the transition region assessed in the 2010 Life in Transition Survey. We find the presence of the female added worker effect, driven by married 45- to 54-year-old women with no children in the household. This effect is the strongest among the region's middle-income countries. Among men, a negative relationship between labor force participation and household-specific income shocks is indicated. Unlike the differences in the response to household-specific income shocks, the labor supply response to a weaker macroeconomic environment is negative for both men and women—hinting at the presence of the "discouraged worker" effect, which cuts across gender lines. We conclude that the decrease in men's labor force participation observed during this crisis is likely a combined result of the initial sectoral contraction and the subsequent impact of the discouraged worker effect. For women, on the other hand, the added worker effect appears to outweigh the discouraged worker effect, contributing to an increase in their labor force participation rate. Our findings highlight the presence of heterogeneity in the way in which household-specific shocks, as opposed to economy-wide conditions, affect both female and male labor force participation rates. |
| Keywords: | Gender Economics; Economic Crisis; Added Worker Effect; Labor Supply Response; Labor Force Participation; Central and Eastern Europe; Former Soviet Union; Transition Countries |
| JEL: | J16 J21 P20 |
| Date: | 2013–05 |
| URL: | http://d.repec.org/n?u=RePEc:lev:wrkpap:wp_765&r=tra |
| By: | Wang, Huashu (Guizhou University); Pan, Lei (Wageningen University); Heerink, Nico (Wageningen University) |
| Abstract: | China is experiencing notable changes in rural-urban migration. Young, more educated migrants with different attitudes towards living and working form an increasing share of the migrant labour force. At the same time, the destinations of migrants are changing as a result of government policies and the global financial crisis. More migrants than before find jobs in medium and small size cities, often located in western and central China. Understanding the characteristics and attitudes of the changing migrant labour force is becoming a major challenge in sustainably managing migration flows and urbanization. Little hard evidence is available on the working conditions and job attitudes of migrant workers, particularly for inland China. The purpose of this paper is to provide insights into the characteristics, working conditions and job attitudes of the new generation of migrants, defined as those born in the 1980s and 1990s, as compared to the traditional generation in a typical medium-size city in western China. Data collected through a household survey conducted among 1,048 migrants in Guiyang City, capital of Guizhou Province, are used for this purpose. We find significant differences in occupational characteristics and working conditions between the two generations. Contrary to popular beliefs, we find that the level of job satisfaction is higher among the new generation of migrants. Using an ordered logit model to examine factors contributing to job satisfaction, we find that age and gender do not have a significant impact for young migrants, while working conditions play a major role. Among these, it is not so much the income level that matters for young migrants, but other working conditions. Using a Blinder-Oaxaca decomposition, we derive that it is mainly the difference in working conditions and other endowments that explains the higher job satisfaction of young migrants, not the differences between generations in the valuations of these endowments. |
| Keywords: | migrant workers, new generation, working conditions, job satisfaction, China |
| JEL: | J61 O15 |
| Date: | 2013–05 |
| URL: | http://d.repec.org/n?u=RePEc:iza:izadps:dp7405&r=tra |
| By: | Su, Yongyang; Lau, Chi Keung Marco; Tan, Na |
| Abstract: | This paper is the first study to examine the effectiveness of the Shanghai Fuel Oil Futures Contract (SHF) in risk reduction on the Chinese energy oil market. We find that the SHF contract can help investors reduce risk by approximately 45%, lower than empirical evidence in developed markets, when weekly data are applied. In contrast, when using daily data SHF contract can only help reduce risk by approximately 9%. The Tokyo Oil Futures Contract (TKF), however, performs two times better, reducing risk by around 17%. The empirical results are robust when variance complicated bivariate GARCH (BGARCH) and bivariate distributions are used. Our results imply the energy oil futures market in China is not well-established and further policy is needed to improve market efficiency. |
| Keywords: | China Energy Oil Market, Hedging Risk Performance, Bivariate GARCH model. |
| JEL: | C32 G32 Q47 |
| Date: | 2013–04–06 |
| URL: | http://d.repec.org/n?u=RePEc:pra:mprapa:47134&r=tra |
| By: | Khan, Muhammad; Kebewar, Mazen; Nenovsky, Nikolay |
| Abstract: | In the late 90's, after severe financial and economic crisis, accompanied by inflation and exchange rate instability, Eastern Europe emerged into two groups of countries with radically contrasting monetary regimes (Currency Boards and Inflation targeting). The task of our study is to compare econometrically the performance of these two regimes in terms of the relationship between inflation, output growth, nominal and real uncertainties from 2000 till now. In other words, we test the hypothesis of non-neutrality of monetary and exchange rate regimes with respect to these connections. In a whole, the empirical results do not allow us to judge which monetary regime is more appropriate and reasonable to assume. EU enlargement is one of the possible explanations for the numbing of the differences and the lack of coherence between the two regimes in terms of inflation, growth and their uncertainties. -- |
| Keywords: | Inflation,Inflation uncertainty,Real uncertainty,Monetary regimes,Eastern Europe |
| JEL: | C22 C51 C52 E0 |
| Date: | 2013–03 |
| URL: | http://d.repec.org/n?u=RePEc:zbw:esprep:73689&r=tra |
| By: | Victor Gorshkov (PhD student, Graduate School of Economics, Kyoto University) |
| Abstract: | The paper represents a case study of Japanese banks operating on the Russian banking market. We particularly analyze motivation, organizational representation, entry modes and strategies of Japanese banks. We argue that in case of Japanese banks both the specificity of the home country (Japan) (relationship banking, main bank system) and host country (Russia) indeed plays an important role in expanding their businesses abroad. The shares of Japanese banks in total banking assets, deposits and lending rate of the Russian banking sector remain low, and in general Japanese banks in Russia might be regarded as “followers” of the Japanese business in Russia. Meanwhile, we also provide evidence that PULL factors are the driving forces providing reasoning for the exceptions from this rule in the behavioral patterns of Japanese banks. The paper summarizes history of foreign expansion of Japanese banks into the Russian market and aims to conduct analysis under the framework of the multinational banking theory. |
| Keywords: | foreign banking, Japanese banks, motivation, entry modes, strategie |
| JEL: | F21 F23 P31 |
| Date: | 2013–05 |
| URL: | http://d.repec.org/n?u=RePEc:kyo:wpaper:864&r=tra |
| By: | Huijuan, Cao; Fujii, Hidemichi; Managi, Shunsuke |
| Abstract: | Beijing organized the 2008 Summer Olympic Games, and the main goal of the Chinese government regarding this event was to hold a Green Olympics. A difference-in-differences approach was used to estimate the environmental impact the Olympic Games on air quality improvement in Beijing, compared to improvements in other areas in China. The results indicate that compared to other regions, air quality in Beijing improved for a short period of time. These improvements were largely due to the implementation of several temporary measures, including factory closures and traffic control. However, there is no evidence indicating that the Olympic Games reduced the concentration of sulfur dioxide in Beijing. -- |
| Keywords: | Olympic Games,Beijing,air pollution,impact estimate,difference-in-differences approach |
| JEL: | Q51 Q53 L83 G14 |
| Date: | 2013 |
| URL: | http://d.repec.org/n?u=RePEc:zbw:ifwedp:201330&r=tra |
| By: | Lau, Chi Keung Marco; Yang, Fu Steve; Zhang, Zhe; Leung, Vincent K.K. |
| Abstract: | Recent studies in the innovation literature reveal that Foreign Direct Investment (FDI) promotes the innovation activities in the recipent country through spillover effects. In this paper we extend the existing literature by incooprating the corruption index in the estimation procedure. Using a cross-country analysis from the Europe and Central Asia (ECA) region , covering 57 countries over the period of 1995-2010, we find no evidence of FDI spillover effect on innovative activity. However, corporate corruption and expenditure on education sector are positively related to the number of patents applications. Our study shed light on the national innovation activities and anti-corruption programs. |
| Keywords: | Foreign direct investment; Corruption; Innovation; Technology transfer |
| JEL: | D73 F21 O32 O34 O38 |
| Date: | 2013–01–05 |
| URL: | http://d.repec.org/n?u=RePEc:pra:mprapa:47153&r=tra |
| By: | Giuditta De Prato (European Commission – JRC - IPTS); Daniel Nepelski (European Commission – JRC - IPTS) |
| Abstract: | We study the patterns and drivers of international technology transfer to and from China and the rest of the world. Our analysis makes use of patent-based measures of cross-border ownership of inventions. To quantify these technology flows, we a patent database providing a worldwide coverage of patents. We use a gravity model to explain the drivers of the international technology transfer. Although China exhibits a large deficit in international technology transfer, the flow of technology from abroad to China intensifies as its absorptive capacity grows. Excluding Taiwan, the US and China relationship dominates the technology transfer between China and the rest of the world. This is even more emphasised by the relatively weak position of Japan and other Asian countries in the process of technology exchange with China. This is result is not affected by the fact that the US acts mainly as an acquirer of Chinese technology. |
| Keywords: | international technology transfer, cross-border ownership of inventions, patent analysis, China |
| JEL: | D8 F23 O14 O30 O57 |
| Date: | 2012–07 |
| URL: | http://d.repec.org/n?u=RePEc:ipt:iptwpa:jrc79397&r=tra |
| By: | Stefanescu, Razvan; Dumitriu, Ramona |
| Abstract: | This paper explores the influence of the foreign exchange rates variation on the returns and volatility of the stock prices from the Romanian capital market for the period of time January 2000 - December 2012. This period was split in four sub-samples corresponding to different stages of the Romanian financial markets evolution. The GARCH models employed in this investigation provided different results. For the transition period January 2000 - December 2007 we found no evidence of the foreign exchange market on the Bucharest Stock Exchange. During a period of time between the Romania’s adhesion to European Union and the announcement of Lehman Brothers’ bankruptcy the results indicate a significant impact of the foreign exchange rates on the stock returns. For the period from September 2008 to February 2010 we find that foreign exchange rates influenced not only the stock returns but also their volatility. However, between March 2010 and December 2012 the impact of the foreign exchange market on the Romanian capital market was limited to the returns. We conclude that influence of the foreign exchange rates variation on the returns and volatility of the stock prices depended on the factors such as the foreign capitals inflows, the global crisis effects and the perceptions of the national economy. |
| Keywords: | Romanian financial markets, Volatility, GARCH, Global crisis |
| JEL: | F31 G01 G19 |
| Date: | 2013–02–28 |
| URL: | http://d.repec.org/n?u=RePEc:pra:mprapa:47229&r=tra |
| By: | Zhao, Xueting; Burnett, J. Wesley; Fletcher, Jerald J. |
| Abstract: | This study offers a unique contribution to the literature by investigating the influential factors of energy-related carbon dioxide emission intensity among a panel of 30 provinces in China covering the period 1991-2010. We use novel spatial panel data models to analyze the drivers of energy-related emission intensity, which we posit are characterized by spatial dependence. Our results suggest: (1) emission intensities are negatively affected by per-capita, provincial-level GDP and population density; (2) emission intensities are positively affected by energy consumption structure and transportation structure; and (3) energy price has no effect on the emission intensities. |
| Keywords: | CO2 emissions intensity, spatial panel data models, China, Environmental Economics and Policy, Resource /Energy Economics and Policy, Q43, Q53, Q54, Q56, |
| Date: | 2013 |
| URL: | http://d.repec.org/n?u=RePEc:ags:aaea13:149006&r=tra |
| By: | Chakraborty, Tanika (Indian Institute of Technology Kanpur); Mirkasimov, Bakhrom (DIW Berlin); Steiner, Susan (University of Hannover) |
| Abstract: | We study how international migration changes the private transfers made between households in the migrant sending communities of developing countries. A priori, it is indeterminate whether migration and remittances strengthen or weaken the degree of private transfers in these communities. From a policy perspective, public income redistribution programmes would have an important role to play if migration reduced the extent of private transfers. Using household survey data from Kyrgyzstan, we find that households with migrant members (as well as households receiving remittances) are more likely than households without migrants (without remittances) to provide monetary transfers to others, but less likely to receive monetary transfers from others. This suggests that migration is unlikely to lead to a weakening of private transfers. |
| Keywords: | private transfers, cash and labour exchange, migration, Kyrgyzstan, Central Asia |
| JEL: | D63 F22 O12 I30 |
| Date: | 2013–05 |
| URL: | http://d.repec.org/n?u=RePEc:iza:izadps:dp7406&r=tra |
| By: | Pawel Baranowski; Mariusz Gorajski; Maciej Malaczewski; Grzegorz Szafranski (Department of Econometrics, Institute of Econometrics, Faculty of Economics and Sociology, University of Lodz) |
| Abstract: | We analyse the short-term dynamics of Polish economy with a prominent state-dependent pricing mechanism of Dotsey, King and Wolman (1999). We compare macroeconomic evidence of price rigidity in a small-scale DSGE model with a state-dependent Phillips curve (SDPC) derived by Bakhshi, Khan and Rudolf (2007) to a benchmark model including hybrid New-Keynesian Phillips Curve (NHPC) of Gali and Gertler (1999). To analyse monetary policy transmission mechanism we estimate both models with Bayesian techniques and focus on the comparison of distribution of price vintages, a degree of price stickiness, values of parameters in Phillips curve equations, and impulse responses to macroeconomic shocks. The estimated state-dependent pricing model generates a median duration of prices about 4 quarters compared to 8 quarters in a time-dependent model. In the state-dependent pricing model it takes more time to dampen inflation dynamics after a monetary policy relative to a time-dependent counterpart. The menu cost model is also able to identify higher variance of technology shocks, and higher persistence in preference shocks, while the dynamics of the impulse responses in time- and state-dependent pricing models are hard to distinguish. |
| Keywords: | state-dependent pricing, inflation, menu costs, monetary policy, Polish economy |
| JEL: | E31 |
| Date: | 2013–04 |
| URL: | http://d.repec.org/n?u=RePEc:tkk:dpaper:dp83&r=tra |
| By: | Arjan de Haan (IDRC) |
| Abstract: | Social policies play a critical role in the transformation of emerging economies. This paper discusses this with reference to China and India, with their very distinctive public policy approaches. Much of the economics literature either does not pay much attention to social policy or regards it as secondary at best or as a market enemy at worst. Views on social policy in emerging economies see this as either lagging or threatening growth. Instead, this paper argues, social policy is congruent and constitutive, and sustainable social policies are those that are formulated as part of economic policies and transformation, and, in turn, shape the conditions of enhancing markets and productivity. The paper describes how the ?great transformation? of both countries shapes social policy responses, the institutions and ideas that give very different shapes to the two countries? policies and the way policies vis-à-vis minorities are situated in both countries? social policies. The conclusion argues for the distinct research agenda that follows from this conceptualisation of social policy. (...) |
| Keywords: | The Social Policies of Emerging Economies: Growth and Welfare in China and India |
| Date: | 2013–06 |
| URL: | http://d.repec.org/n?u=RePEc:ipc:wpaper:110&r=tra |