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on Transition Economics |
| By: | Anders Aslund (Peterson Institute for International Economics) |
| Abstract: | Ukraine's intention to sign the European Association Agreement at the Vilnius summit in late November 2013 has raised a furor in the Kremlin, which wants it to join the Customs Union instead. In retaliation, Russia has imposed trade sanctions against Ukraine in clear violation of its obligations in the World Trade Organization (WTO). Åslund argues that Europe, Ukraine, and Russia all share the blame for creating the current impasse and must alter their policies to resolve the conflict. Ukraine should improve its macroeconomic policies to reduce its vulnerability and also comply with all EU demands, including releasing Yulia Tymoshenko. The European Union should support Ukraine but also make sure that Ukraine meets its conditions so that both parties can sign the agreement in November. The Association Agreement will bring substantial gains to Ukraine, whereas the Customs Union is smaller, less competitive, and does not offer Ukraine any significant benefits. Russia should realize that it is not in its national interest to force countries to join its Customs Union. It should obey the rules of the WTO and the Commonwealth of Independent States Free Trade Agreement and end its trade sanctions against Ukraine. The United States and the European Union should defend Ukraine against Russian economic aggression in the WTO and through vocal and economic support. |
| Date: | 2013–09 |
| URL: | http://d.repec.org/n?u=RePEc:iie:pbrief:pb13-22&r=tra |
| By: | Vincent Koen; Richard Herd; Sam Hill |
| Abstract: | China is well-placed to avoid the so-called “middle-income trap” and to continue to converge towards the more advanced economies, even though growth is likely to slow from near double-digit rates in the first decade of this millennium to around 7% at the 2020 horizon. However, in order to sustain vigorous growth and improve the well-being of most citizens, renewed reform momentum is required in a number of areas. The following ones are discussed in this paper: financial sector liberalisation; strengthening competition in markets for goods and services; education, research and innovation. Progress is also needed in other areas, notably in fostering more socially-inclusive forms of urbanisation and more environmentally-friendly growth. En marche pour la prospérité : Réformer pour poursuivre le rattrapage en Chine La Chine est bien placée pour ne pas rester un pays à revenu intermédiaire et continuer à converger vers les économies les plus avancées, même si la croissance est vraisemblablement amenée à ralentir, passant d’un rythme à deux chiffres pendant la première décennie de ce millénaire à environ 7% à l’horizon 2020. Toutefois, le maintien d’une croissance vigoureuse et améliorant le bien-être de la majorité des citoyens nécessite une accélération des réformes dans un certain nombre de domaines. Sont passés en revue dans ce document : la libéralisation du secteur financier ; renforcer la concurrence sur les marchés des biens et services ; l’éducation, la recherche et l’innovation. Des progrès sont également requis dans d’autres domaines, notamment pour promouvoir des formes d’urbanisation socialement plus inclusives et une croissance plus respectueuse de l’environnement. |
| Keywords: | economic growth, productivity, convergence, patents, innovation, education, credit, research and development, China, living standards, catching-up, international migration, cities, business climate, urbanisation, renminbi, foreign exchange, investment, competition, development, financial sector, intellectual property rights, shadow banking, recherche et développement, droits de propriété intellectuelle, convergence, innovations, migration interne, renminbi, système bancaire parallèle, Chine, niveau de vie, crédit, rattrapage, climat des affaires, urbanisation, villes, brevets, réserves de change, concurrence, développement, secteur financier, éducation, croissance économique, productivité, investissement |
| JEL: | D61 E20 E22 E23 E24 E27 E42 E44 E52 F21 F23 F31 F32 F43 G23 G28 I25 J11 J21 J24 J61 N15 N25 N35 O11 O14 O15 O16 O19 O24 O31 O32 O34 O38 O47 O53 P21 |
| Date: | 2013–11–12 |
| URL: | http://d.repec.org/n?u=RePEc:oec:ecoaaa:1093-en&r=tra |
| By: | Nicholas Borst (Peterson Institute for International Economics) |
| Abstract: | The Chinese financial system stands at a crossroads. The response to the global financial crisis eroded some of the hard-earned discipline put in place during the 2000s. As a result, significant risks have accumulated, and the financial sector once again appears vulnerable to large-scale credit misallocation and spiraling bad debts. Reducing these risks will take a new wave of concerted action. Absent better regulation, the tremendous growth of credit in recent years has the potential to result in large-scale financial distress. |
| Date: | 2013–10 |
| URL: | http://d.repec.org/n?u=RePEc:iie:pbrief:pb13-24&r=tra |
| By: | Bruna Škarica |
| Abstract: | This paper analyses the determinants of the changes in non-performing loans (NPL) ratio in selected European emerging markets. The model was estimated on a panel dataset using fixed effects estimator for seven Central and Eastern European (CEE) countries between Q3:2007 and Q3:2012. The analyzed countries are Bulgaria, Croatia, Czech Republic, Hungary, Latvia, Romania and Slovakia. Although the literature on NPLs is quite extensive, this is the first empirical research on the countries of CEE region using aggregate, country – level data on problem loans. The results suggest that the primary cause of high levels of NPLs is an economic slowdown, which is evident from statistically significant and economically large coefficients on GDP, unemployment and inflation rate. |
| Keywords: | non-performing loans, macro-financial linkages, Central and Eastern Europe, panel regressions, financial stability |
| JEL: | E32 E44 E52 G10 |
| Date: | 2013–11–19 |
| URL: | http://d.repec.org/n?u=RePEc:zag:wpaper:1307&r=tra |
| By: | Miguel Elosua (CECMC-CCJ - Centre d'études sur la Chine moderne et contemporaine - CNRS : UMR8173 - École des Hautes Études en Sciences Sociales [EHESS]); François Gipouloux (CCJ - Chine, Corée, Japon - CNRS : UMR8173 - École des Hautes Études en Sciences Sociales [EHESS] - Université Paris VII - Paris Diderot); Sébastien Goulard (CECMC-CCJ - Centre d'études sur la Chine moderne et contemporaine - CNRS : UMR8173 - École des Hautes Études en Sciences Sociales [EHESS]); Shantong Li (DRC - Development Research Center of the State Council - State Council, China); Pengfei Ni (CASS-IFTE - Institute of Finance and Trade Economics - Chinese Academy of Social Sciences) |
| Abstract: | This working paper examines the evolution of Chinese cities and the challenges they are currently facing. It aims to identify possible patterns of urbanisation in the next forty years. The first part analyses the transformation of Chinese cities as a consequence of the economic policies implemented within the country. The authors argue that the economic reform has accelerated China's urbanisation. Other factors of this massive urbanisation include the improvement of transport infrastructures and the transformation of China's industries. The reform of the tax system between central and local authorities in 1994 is also examined, and its consequences on urbanisation, and its limitations. Based on this analysis, the second part introduces the possible strategies China may adopt for the development of its cities. The objective of these policies will be mainly to control the path of urbanisation to prevent the emergence of super large city and encourage the creation of city networks. Future urban policies will also need to tackle such issues as rural flight and environment protection. |
| Keywords: | urbanisation; China; tax-sharing system; super large cities |
| Date: | 2013–11 |
| URL: | http://d.repec.org/n?u=RePEc:hal:wpaper:hal-00903218&r=tra |
| By: | Shenggen Fan; Ravi Kanbur; Shang-Jin Wei; Xiaobo Zhang |
| Abstract: | This paper is the first chapter in the Oxford Companion to the Economics of China (Oxford University Press, forthcoming). Rather than trying to summarize other contributors’ views, we provide our own perspectives on the Economics of China—the past experience and the future prospects. Our reading of China’s economic development over the past 35 years raises two major sets of issues, one of which is inward looking, and the other of which is outward looking. While Chinese aggregate development is impressive, it has raised the question of whether the growth is sustainable, and has led to a set of distributional issues and well-being concerns. We argue that these internal issues combine with those raised by China’s rapid integration and ever growing presence in the international arena, to jointly frame the challenges faced by China in the next 35 years, as it approaches the 100th anniversary of the People’s Republic in 2049. |
| JEL: | O1 P2 |
| Date: | 2013–11 |
| URL: | http://d.repec.org/n?u=RePEc:nbr:nberwo:19648&r=tra |
| By: | Démurger, Sylvie (CNRS, GATE); Xu, Hui (Beijing Normal University) |
| Abstract: | This paper examines how left-behind children influence return migration in China. We first present a simple illustrative model based on Dustmann (2003) that incorporates economic and non-economic motives for migration duration (or intentions to return), among which are parents' concerns about the well-being of their left-behind children. We then propose two complementary empirical tests based on data we collected from rural households in Wuwei county (Anhui province) in fall 2008. We first use a discrete-time proportional hazard model to estimate the determinants of migration duration for both on-going migrants with an incomplete length of duration and return migrants with a complete length of duration. Second, we apply a binary Probit model to study the return intentions of on-going migrants. Both models yield consistent results regarding the role of left-behind children as a significant motive for return. First, left-behind children are found to draw their parents back to the village, the effect being stronger for pre-school children. Second, sons are found to play a more important role than daughters in reducing migration duration. |
| Keywords: | left-behind children, migration duration, return migration, discrete-time duration analysis, China |
| JEL: | J61 J13 C41 C25 O53 |
| Date: | 2013–11 |
| URL: | http://d.repec.org/n?u=RePEc:iza:izadps:dp7727&r=tra |
| By: | Zhichao Guo (Beijing Technology and Business University); Yuanhua Feng (University of Paderborn); Thomas Gries (University of Paderborn) |
| Abstract: | The purpose of this paper is to investigate changes of China's agri-food exports to Germany caused by China's accession to WTO and the global financial crisis in a quantitative way. The paper aims to detect structural breaks and compare differences before and after the change points. The structural breaks detection procedures in this paper can be applied to find out two different types of change points, i.e. in the middle and at the end of one time series. Then time series and regression models are used to compare differences of trade relationship before and after the detected change points. The methods can be employed in any economic series and work well in practice. The results indicate that structural breaks in 2002 and 2009 are caused by China's accession to WTO and the financial crisis. Time series and regression models show that the development of China's exports to Germany in agri-food products has different features in different sub-periods. Before 1999, there is no significant relationship between China's exports to Germany and Germany's imports from the world. Between 2002 and 2008 the former depends on the latter very strongly, and China's exports to Germany developed quickly and stably. It decreased however suddenly in 2009, caused by the great reduction of Germany's imports from the world in that year. But China's market share in Germany still had a small gain. Analysis of two categories in agri-food trade also leads to similar conclusions. |
| Keywords: | Agri-food trade, structural breaks, China's accession to WTO, financial crisis, change of trade relationship financial crisis of 2008, growth causes, structural breaks |
| Date: | 2013–11 |
| URL: | http://d.repec.org/n?u=RePEc:pdn:wpaper:72&r=tra |
| By: | Jiøí Navrátil; Ondøej Císaø (Department of Public Economics, Masaryk University) |
| Abstract: | The paper focuses on the responses of Czech left social movements to the coming of economic crisis to the country. It seeks to answer two questions. The first one is whether the coming of economic crisis has activated two processes of social movement transnationalization that take place on the domestic level: the global framing and externalization. The second question is why this activation has not taken place. In our analysis we distinguish between the “old” left (trade unions, social democrats) and “radical” left (anarchists, Trotskyites) in order to explore paths of different modes of left activism. First, we focus on the evolution of framing scale and of the target scale of Czech Left activism between 2000 and 2010 and suggest that while the trajectories of both modes of Left activism experienced dramatic shifts both upwards and downwards, there are hardly any signs of real transnationalization after the crisis hit the country (2009). On the contrary, it seems that while the old left shifted the framing upwards onto national level, the radical left shifted the target of their protests downwards onto the local level. Second, following the analyses of institutional and discursive opportunities, we show that it was the timing and way of interpretation of a financial crisis from the part of national political elites and media that determined the scale and intensity of political contention over its consequences. The paper builds upon the analysis of protest events organized by left SMOs in the Czech Republic between 2000 and 2010 (N=668). We integrate protest event and frame analysis and code – among other - the scale of framing and targets of the recorded events. |
| Keywords: | Economic crisis, austerity, political conflict, labour unions, social movements. |
| JEL: | D72 L31 |
| Date: | 2013–11 |
| URL: | http://d.repec.org/n?u=RePEc:mub:wpaper:12&r=tra |
| By: | Degryse, Hans; Lu, Liping; Ongena, Steven |
| Date: | 2013 |
| URL: | http://d.repec.org/n?u=RePEc:ner:leuven:urn:hdl:123456789/403373&r=tra |
| By: | Ana Grdović Gnip (Faculty of Economics & Tourism Dr. Mijo Mirković, Juraj Dobrila University of Pula and Faculty of Economics, University of Ljubljana) |
| Abstract: | The aim of this paper is to assess the stabilization effects of fiscal policy in Croatia in a structural vector autoregression framework as proposed by Blanchard and Perotti (2002). Empirical studies of fiscal policy effects show that results are contradictory and do not unanimously agree, except for one fact: a positive government spending shock has a positive effect on output. This study inspects the effects of government spending and tax shocks on a set of macroeconomic variables (output, prices, interest rates, private consumption, private investment, employment and wages). Results prove that the fiscal transmission mechanism in Croatia works mainly in a Keynesian manner. Output reacts negatively to a tax shock and positively to government spending shock. The output multiplier is above 2 at impact and the effect is significant throught the whole time span. The negative effect of the tax shock is mostly driven by indirect (not direct) taxes, while the positive effect of a government spending shock is influenced by government consumption and government investment, but the effect of the latter is more significant when private consumption and private investment responses are observed. |
| Keywords: | fiscal policy, fiscal multiplier, spending shock, tax shock, SVAR, Croatia |
| JEL: | C32 E62 H30 |
| Date: | 2013–11–13 |
| URL: | http://d.repec.org/n?u=RePEc:zag:wpaper:1306&r=tra |
| By: | Pawel{\l} Fiedor |
| Abstract: | In this paper we analyse the structure of Warsaw's stock market using complex systems methodology together with network science and information theory. We find minimal spanning trees for log returns on Warsaw's stock exchange for yearly times series between 2000 and 2013. For each stock in those trees we calculate its Markov centrality measure to estimate its importance in the network. We also estimate entropy rate for each of those time series using Lempel-Ziv algorithm based estimator to study the predictability of those price changes. The division of the studied stocks into 26 sectors allows us to study the changing structure of the Warsaw's stock market and conclude that the financial crisis sensu stricto has ended on Warsaw's stock market in 2012-13. We also comment on the history and the outlook of the Warsaw's market based on the log returns, their average, variability, entropy and the centrality of a stock in the dependency network. |
| Date: | 2013–11 |
| URL: | http://d.repec.org/n?u=RePEc:arx:papers:1311.4230&r=tra |
| By: | Petreski, Marjan; Jovanovic, Branimir |
| Abstract: | The objective of this study is to investigate whether remittances in Macedonia affect poverty and inequality. Using two household surveys, one conducted in 2008, one in 2012, we find that remittances reduce both poverty and inequality. The inequality-reducing effect has been particularly present in 2012. |
| Keywords: | remittances, poverty, income inequality, self-employment, Macedonia |
| JEL: | O15 |
| Date: | 2013 |
| URL: | http://d.repec.org/n?u=RePEc:pra:mprapa:51413&r=tra |
| By: | Barbara Liberda (Faculty of Economic Sciences, University of Warsaw); Joanna Tyrowicz (Faculty of Economic Sciences, University of Warsaw; National Bank of Poland); Magdalena Smyk (Faculty of Economic Sciences, University of Warsaw) |
| Abstract: | One could expect that in the so-called talent occupations, while access to these professions may differ between men and women, gender wage gap should be actually smaller due to high relevance of human capital quality. Wage regressions typically suggest an inverted U-shaped age-productivity pattern. However, such analyses confuse age, cohort and year effects. Deaton (1997) decomposition allows to disentangle these effects. We apply this method to inquire the age-productivity pattern for the so-called “talent†occupations. Using data from a transition economy (Poland) we find that indeed talent occupations have a steeper age-productivity pattern. However, gender differences are larger for talent occupations than for general occupations. |
| Keywords: | age-productivity pattern, gender wage gap, transition |
| JEL: | J24 J31 I20 J71 |
| Date: | 2013 |
| URL: | http://d.repec.org/n?u=RePEc:war:wpaper:2013-27&r=tra |