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on Confederation of Independent States |
| By: | J. David Brown; John Earle; Almos Telegdy |
| Abstract: | This paper estimates the effect of privatization on multifactor productivity (MFP) using long panel data for nearly the universe of initially state-owned manufacturing firms in four economies. We exploit the key longitudinal feature of our data to measure and control for pre-privatization selection bias and to estimate long-run impacts. We find that the magnitudes of our estimates are robust to alternative functional forms, but sensitive to how we control for selection. Our preferred random growth models imply that majority privatization raises MFP about 15% in Romania, 8% in Hungary, and 2% in Ukraine, while in Russia it lowers it 3%. Privatization to foreign rather than domestic investors has a larger impact, 18-35%, in all countries. Positive domestic effects appear within a year in Hungary, Romania, and Ukraine and continue growing thereafter, but take 5 years after privatization to emerge in Russia. |
| Keywords: | privatization, productivity, foreign ownership, random growth model, transition, Hungary, Romania, Russia, Ukraine |
| JEL: | D24 G34 L33 P31 |
| Date: | 2005 |
| URL: | http://d.repec.org/n?u=RePEc:hwe:certdp:0508&r=cis |
| By: | J. David Brown; John Earle; Almos Telegdy |
| Abstract: | We analyze the effects of privatization on firm-level wages and employment in four transition economies. Contrary to workers' fears, our fixed effect and random trend estimates imply little effect of domestic privatization, except for a slight negative effect in Russia, and they provide some evidence of positive foreign effects on both wages and employment in all four countries. The negligible employment impact of domestic privatization results from effects on efficiency and scale that are large, positive, but offsetting in Hungary and Romania, and from small effects of both types in Russia and Ukraine. The positive employment and wage bill consequences of foreign ownership result from a substantial scale-expansion effect that dominates the efficiency effect. |
| Keywords: | privatization, employment, wages, foreign ownership, Hungary, Romania, Russia, Ukraine |
| JEL: | D21 G34 J23 J31 L33 P3 |
| Date: | 2005 |
| URL: | http://d.repec.org/n?u=RePEc:hwe:certdp:0509&r=cis |
| By: | Andrew Austin; Tatyana Kosyaeva; Nathaniel Wilcox |
| Abstract: | Prominent analysts argue that the Russian reform process has gone badly because Russian attitudes towards the market mechanism fundamentally differ from those in the West. Others strenuously dispute this. We combine surveys and a double auction experiment to investigate Russian beliefs about how markets work. Beliefs about the likelihood that economic theory would predict outcomes were elicited before (‘ex ante’) and after (‘ex post’) the double auction. Women, graduates of general secondary schools, children of Orthodox parents and children of entrepreneurs are more skeptical ex ante. Having observed the trading results women, children of Orthodox parents and children of entrepreneurs become less skeptical. Graduates of general secondary schools remain relatively skeptical ex post. Measures of political orientation are weakly associated with beliefs, and sociodemographic characteristics, such as occupation, income and parents’ education, have no detectable effect on beliefs about the predictive value of economic theory. |
| Date: | 2005–11 |
| URL: | http://d.repec.org/n?u=RePEc:cer:papers:wp278&r=cis |