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on Transition Economics |
| By: | Agustín Casas (Universidad CUNEF); Federico Curci (Universidad CUNEF) |
| Abstract: | We exploit the 2022 Russian invasion of Ukraine as a shock to the anti-Russia attitudes in Spain. We collect data from multiple sources: the Spanish NATO referendumof 1986, monthly public opinion surveys with voting and pro-war attitudes, and the universe of political speeches in the Spanish Congress. Using different empirical strategies we robustly identify the effect of the invasion on domestic politics. The three main results are the following: we show that the Russia-Ukraine conflict increased by around 5 percentage points the current intention to vote for the main center-right party (Partido Popular–PP) among the individuals in the municipalities that strongly supported NATO in the 1986 referendum. Similarly, in those municipalities, individuals have lower “sympathy” for Russia and a stronger perception of the country as a military threat. Finally, the increase in the voting intention for the PP goes hand in hand with the legislators’ narrative in Congress: after the invasion, PP legislators are more likely to mention Russia in their speeches, and when they do, they talk more negatively about it. |
| Keywords: | Public Opinion, International Organizations, NATO, Russia, Ukraine |
| Date: | 2024–09 |
| URL: | https://d.repec.org/n?u=RePEc:aoz:wpaper:337 |
| By: | Anton Grui (Charles University, National Bank of Ukraine) |
| Abstract: | In this paper, I study Ukraine´s heterogeneous and time-variant pass-through from the money market interest rate to bank deposit and lending rates. I utilize a new panel dataset containing individual banks´ characteristics and prudential indicators over 2019-2023, a period comprising the full-scale Russian invasion. First, using TVPARDL models, I reveal that during the invasion, the pass-through diminished for all examined bank products. It is also weaker to deposits in times of monetary policy tightening. Second, using panel regressions, I show how banks´ characteristics and prudential indicators influence the transmission. Their impacts are asymmetric during monetary policy tightening and loosening. Overall, I track wartime interest rate pass-through for practical monetary policy purposes and contribute to the topic of interactions between monetary and prudential policies. |
| Keywords: | monetary policy transmission mechanism, interest rate pass-through, wartime economy |
| JEL: | C54 E43 E52 G21 |
| Date: | 2024–09 |
| URL: | https://d.repec.org/n?u=RePEc:fau:wpaper:wp2024_33 |
| By: | Stewart, Susan |
| Abstract: | The Russian war of aggression has deepened relations between the EU and Ukraine. This can be seen, above all, in Ukraine's EU candidate status. Despite the war, Ukraine continues to pursue many reforms, even if their pace has slowed since February 2022. The strong concentration of power in the Office of the President negatively affects the separation of powers. It makes judicial reforms more difficult and hinders parliament's ability to exercise its functions. The war has weakened the power of oligarchs in Ukraine in many respects. Yet the form of governance in the country has not experienced a clear break from the past. Even during the invasion, the authorities are continuing their fight against corruption among the elite. The population perceives some progress, but high-level corruption remains a deep-rooted challenge. Civil society activities have changed both qualitatively and quantitatively as a result of the war and have become more significant since the invasion. Civil society engagement can be fostered with the help of returning Ukrainian migrants and through the involvement of Ukrainians abroad. Ukraine's municipalities will play a key role in reconstruction, or are doing so already. To ensure that reconstruction is successful in all its dimensions, municipalities should continuously be involved in the mechanisms and processes currently being developed. In order to meaningfully intensify Ukraine-EU relations, it is essential that rule of law be expanded and consolidated, not only in Ukraine, but also in the EU and its member states. |
| Keywords: | Russian war of aggression, EU, Ukraine, Office of the President, separation of powers, judicial reforms, power of oligarchs, corruption among the elite, civil society engagement, municipalities, reconstruction, rule of law |
| Date: | 2024 |
| URL: | https://d.repec.org/n?u=RePEc:zbw:swprps:302553 |
| By: | Flach, Lisandra; Heiland, Inga; Larch, Mario; Steininger, Marina; Teti, Feodora A. |
| Abstract: | This paper evaluates the effects of sanctions on Russia between 2014 and 2019 and the resulting countersanctions. We estimate their impact on trade in a gravity framework, allowing for treatment heterogeneity among pairs and sectors, and use the estimated elasticities in a general equilibrium analysis. We find that the sanctions decreased trade with Russia in key sectors, translating to a loss in real income in Russia by 0.3%. Full decoupling of the EU and its allies from Russia would increase this effect to over 4%. Our results emphasize the role of deep sanctions as a foreign policy instrument and international cooperation. |
| Keywords: | general equilibrium, sanctions, structural gravity, treatment heterogeneity |
| JEL: | F1 F13 F14 F5 F51 H5 N4 |
| Date: | 2023 |
| URL: | https://d.repec.org/n?u=RePEc:zbw:ifwkie:302103 |
| By: | Tomas Boukal (Institute of Economic Studies, Charles University, Prague, Czech Republic) |
| Abstract: | Multinational enterprises are increasingly using offshore locations to pay lower taxes on their profits. This behavior has distortive effects on the global economy, as the concentration of multinational activities mirrors global tax patterns. In this paper, I exploit the OECD country-by-country reporting statistics to analyze the determinants behind the location of profits. I find that profit allocation is sensitive to both effective tax rates and geographical proximity, confirming the significance of these factors in MNEs´ tax planning strategies. Building on the work of Dharmapala and Hines (2009), this study also uncovers that MNEs are more likely to report profits to jurisdictions with superior governance quality, integrating both Global Governance Indicators and factors linked to financial secrecy. However, the findings indicate that tax haven jurisdictions exhibit a degree of reluctance when it comes to implementing recently introduced policies aimed at combating corruption and tax abuses. |
| Keywords: | international taxation, tax havens, country-by-country reporting, gravity models, governance quality |
| JEL: | F23 G15 G28 H26 H32 |
| Date: | 2024–09 |
| URL: | https://d.repec.org/n?u=RePEc:fau:wpaper:wp2024_31 |
| By: | Beckmann, Joscha; Czudaj, Robert L.; Murach, Michael |
| Abstract: | The objective of this paper is to analyze the macroeconomic effects of media coverage related to the trade conflict between China and the U.S. for selected countries of the European Union. Our main aim is to evaluate whether media coverage constitutes a relevant transmission channel for macroeconomic effects. We evaluate the response of survey-based macroeconomic expectations, stock prices, and realized industrial production. Our analysis focuses on Germany, France, Italy, and Spain in order to allow for heterogeneous effects across major EU countries. We find significant effects on expectations, stock prices, and industrial production. Especially, a significantly negative effect on current account expectations is observed for three of the four considered EU countries (Germany, Italy, and Spain). |
| Keywords: | China, Current account, EU, Expectations, Trade war |
| JEL: | F32 F41 F43 |
| Date: | 2024 |
| URL: | https://d.repec.org/n?u=RePEc:pra:mprapa:121751 |
| By: | Wang, Xiaonan; Wang, Yan |
| Abstract: | Political leaders in China regularly launch anti-corruption campaigns to win public support. But how are anti-corruption signals perceived? We use event study to examine the case of Xi Jinping’s anti-corruption campaign – an unprecedented effort in China to fight corruption. Contrary to expectations, we find that for the firms with connected officials later investigated, the initial anti-corruption signals – speeches from the top leadership and earlier crackdowns on other senior officials – did not decrease their stock prices. We argue that the perceived high costs of following through and repeated campaigns in the past paradoxically nurtured cynicism. We exploit the case of Zhou Yongkang and Ling Jihua – the two officials who were alleged to be involved in the power struggle and whose downfall had circulated widely since 2012. We find that when the targets of earlier crackdowns were connected to Zhou or Ling, the stock prices of the firms went down only if their connected and later investigated officials were in the same faction; the stock prices of the other firms, however, went up. We interpret the results as investors’ misperceptions of the campaign in the beginning. Our findings suggest that even real efforts in campaign-style enforcement can be dismissed. |
| Keywords: | anti-corruption campaign; campaign-style enforcement; event study; stock market |
| JEL: | F3 G3 |
| Date: | 2022–12–01 |
| URL: | https://d.repec.org/n?u=RePEc:ehl:lserod:124863 |
| By: | António Afonso; Ana Patricia Montes Caparrós; José M. Domínguez |
| Abstract: | In this paper, we estimate the potential tax burden in a panel data set comprising OECD countries over the period 2000-2021. To this end, we use non-parametric and parametric techniques: Data Envelopment Analysis (DEA) and Stochastic Frontier Analysis (SFA). In this way, it will be possible for us to identify which countries are close to their potential tax capacity and which are far from it. Moreover, we can determine whether they may sustain an increase (decrease) in their actual tax burden depending on whether the tax effort ratio is lower or higher relatively to other similar countries in the sample. Non-parametric and parametric results coincide rather closely on the positioning of the countries vis-à-vis the production possibility frontier and on their relative distances to the frontier. Efficient countries most of the times are: Belgium, Colombia, Finland, France, Italy, Latvia, Slovak Republic, and Sweden. |
| Keywords: | OECD; tax burden; tax efficiency; Stochastic Frontier Analysis; Data Envelopment Analysis. |
| JEL: | C14 C23 H20 H21 H30 |
| Date: | 2024–09 |
| URL: | https://d.repec.org/n?u=RePEc:ise:remwps:wp03392024 |