nep-cis New Economics Papers
on Confederation of Independent States
Issue of 2016‒03‒23
eleven papers chosen by

  1. The Nature of Swedish-Russian Capital Flows By Becker, Torbjörn
  2. Bank ownership and cost efficiency in Russia, revisited By Mamonov, Mikhail; Vernikov, Andrei
  3. Disentangling loan demand and supply shocks in Russia By Deryugina, Elena; Kovalenko, Olga; Pantina, Irina; Ponomarenko, Alexey
  4. Expected returns and idiosyncratic risk: Industry-level evidence from Russia By Kinnunen, Jyri; Martikainen, Minna
  5. Colonization and Changing Social Structure: Kazakhstan 1896-1910 By Gani Aldashev; Catherine Guirkinger
  6. Çevre Kirliliği Ve Ekonomik Büyüme İlişkisi Gelişmiş ve Gelişmekte Olan Ülkelerin Veri Görselleştirme Kullanarak Karşılaştırılması By Ertürk, Mevlüde
  7. Anti-Western conspiracy thinking and expectations of collusion: Evidence from Russia and China By Libman, Alexander; Vollan, Björn
  8. Nowcasting and short-term forecasting of Russian GDP with a dynamic factor model By Porshakov, Alexey; Deryugina, Elena; Ponomarenko, Alexey; Sinyakov, Andrey
  9. Дмитрий Сироткин – основоположник судоходства и судостроительства в Сербии By Bukvić, Rajko; Makarov, Igor
  10. Government Wealth Funds and Monetary Policy By Sergey Sinelnikov-Murylev; Pavel Trunin
  11. Score Card Survey on Rating of Real Estate Market Institute By Ò. A. Strelnikova

  1. By: Becker, Torbjörn (Stockholm Institute of Transition Economics)
    Abstract: This paper provides a detailed investigation of the investment flows between Russia and Sweden in the last decade and a half. The bilateral data consists of both aggregate macro data and company level greenfield and M&A FDI. The relatively large flows from Sweden to Russia and insignificant flows in the other direction support the hypotheses that investments tend to go from higher income countries to lower income countries and from smaller markets to larger. Investment flows have grown in line with trade, consistent with the idea that international investments and exports often are compliments rather than substitutes. The investments from Sweden to Russia also show that FDI has been a more stable source of foreign funding than portfolio flows as has been argued both in the theoretical and empirical literature; Whereas portfolio flows have declined significantly since the global crisis in 2008, the stock of FDI has continued to increase. The paper also argues that it is hard to predict aggregate bilateral flows with great precision, in particular for such a large economy as the Russian, and empirical models tend to generate expected flows from Sweden to Russia that are larger than the ones observed. In terms of reasons for FDI between the two countries, horizontal FDI seem to dominate by a wide margin. However, there are a few examples of vertical FDI in resource intensive sectors in Russia, and limited amounts of complex FDI in Sweden by Russian companies. In the challenging environment Russia is currently facing due to low international oil prices and sanctions it will be hard to attract new FDI. Although it may be tempting to use short-term tax exemptions or barriers to trade to induce FDI, sustainable long-run policies should focus on fundamental reforms of the institutions that reduce corruption, contribute to the rule of law and limit excess bureaucratic burdens. This will not only make Russia attractive to foreign investors but also encourage domestic innovators and entrepreneurs to help modernize and diversify the economy.
    Keywords: FDI; Capital flows; Gravity model; Sweden; Russia
    JEL: F21 F23 F41
    Date: 2016–03–10
  2. By: Mamonov, Mikhail; Vernikov, Andrei
    Abstract: This paper considers the comparative efficiency of public, private, and foreign banks in Rus-sia, a transition economy with several unusual features. We perform stochastic frontier anal-ysis (SFA) of Russian bank-level quarterly data over the period 2005–2013. The method of computation of comparative cost efficiency is amended to control for the effect of revalua-tion of foreign currency items in bank balance sheets. Public banks are split into core and other state-controlled banks. Employing the generalized method of moments, we estimate a set of distance functions that measure the observed differences in SFA scores of banks and bank clusters (heterogeneity in risk preference and asset structure) to explain changes in bank efficiency rankings. Our results for comparative Russian bank efficiency show higher efficiency scores, less volatility, and narrower spreads between the scores of different bank types than in previous studies. Foreign banks appear to be the least cost-efficient market participants, while core state banks on average are nearly as efficient as private domestic banks. We suggest that foreign banks gain cost-efficiency when they increase their loans-to-assets ratios above the sample median level. Core state banks, conversely, lead in terms of cost efficiency when their loans-to-assets ratio falls below the sample median level. The presented approach is potentially applicable to analysis of bank efficiency in other dollarized emerging markets.
    Keywords: banks, comparative efficiency, SFA, state-controlled banks, Russia
    JEL: G21 P23 P34 P52
    Date: 2015–07–27
  3. By: Deryugina, Elena; Kovalenko, Olga; Pantina, Irina; Ponomarenko, Alexey
    Abstract: ​This article presents three alternative models for decomposing loan developments into components associated with changes in loan demand and supply fundamentals. Two models are based on macro data (error correction model and structural vector autoregression with sign restrictions) and one is based on bank-specific Bank Lending Survey results. We conclude that although loan growth in Russia converges to a long-run equilibrium determined by macroeconomic (demand) factors the convergence is likely to be driven by bank-side (supply) shocks. We identify large and unexplained supply shocks in loan fluctuations during the crisis of 2008–2009, signifying an impairment of credit markets. We also find contractionary shocks unrelated to demand fundamentals or balance sheet structures in 2013, although in general loan developments in 2013 and the first half of 2014 were not at all extraordinary.
    Keywords: loan demand, loan supply, cointegration, structural VAR, sign restrictions, Bank Lending Survey, Russia
    JEL: C32 E51 G21
    Date: 2015–03–05
  4. By: Kinnunen, Jyri; Martikainen, Minna
    Abstract: ​In this paper, we explore a relation between expected returns and idiosyncratic risk. As in many emerging markets, investors in the Russian stock market cannot fully diversify their portfolios due to transaction costs, information gathering and processing costs, and short-comings in investor protection. This implies that investors demand a premium for idiosyncratic risk – unique asset-specific risk plays a role in investment decisions. We estimate the price of idiosyncratic risk using MIDAS regressions and a cross-section of Russian industry portfolios. We find that idiosyncratic risk commands an economically and statistically significant risk premium. The results remain unaffected after controlling for global pricing factors and short-term return reversal.
    Keywords: idiosyncratic risk, industry risk, cross-sectional returns, MIDAS, Russia
    JEL: G12
    Date: 2015–10–30
  5. By: Gani Aldashev; Catherine Guirkinger
    Abstract: This paper investigates how, under increasing land pressure during Russian settlement in Kazakh steppes in the late-XIXth century, family-based institutions and social structure of Kazakhs evolved to adapt to new economic conditions. Using a rich dataset constructed from Russian colonial expedition materials, we find that during the transition from nomadic pastoralism to a semi-sedentary pastoralist-agriculture system, the size of Kazakh extended families increased, those of communes and clans decreased, and that Kazakhs identified stronger with lower levels of genealogical clan system. Within families, property rights on land became more individualized, households became less likely to pool labor to farm, and wage labor contracts in agriculture became common. We discuss theoretical explanations for the observed patterns.
    Date: 2016–03
  6. By: Ertürk, Mevlüde
    Abstract: The aim of the study is to investigate relationship between environmental pollution and economic growth. For this aim, two groups of countries are compared which are developed countries and developing countries. Germany, France, UK and Netherland which are the member of EU are chosen as a developed countries and Brazil, Russia, India and China which are known as BRIC countries are chosen as a developing countries. In this study descriptive statistics are analyzed by data visualization techniques using 2000-2010 period annual data. The results show that the relationship between environmental pollution and economic growth is differentiating based on development level of the countries.
    Keywords: Environmental Pollution, Economic Growth, CO2 Emission, Data Visualization
    JEL: C1 O4 Q5
    Date: 2016–03–08
  7. By: Libman, Alexander; Vollan, Björn
    Abstract: Anti-Western conspiracies are frequently used by Governments to strengthen their power. We investigate the impact of conspiracy thinking on expectations of collusion among individuals in Russia and China. For this purpose, we conduct a novel laboratory experiment to measure expectations of collusion and several survey items related to conspiracy thinking. Our survey results indicate that anti-Western conspiracy thinking is widespread in both countries and correlates with distrust. We find a significant effect of anti-Western conspiracy thinking in China: Anti-Western conspiracy thinking correlates with lower expectations of collusion. We explain this result by stronger ingroup feeling emanating from the anti-Western sentiment. Our paper provides a first step in analyzing the economic implications of conspiracy thinking for society.
    Keywords: conspiracy thinking, Russia, China, trust, collusion experiments
    JEL: C91 D83 O17
    Date: 2015–04–29
  8. By: Porshakov, Alexey; Deryugina, Elena; Ponomarenko, Alexey; Sinyakov, Andrey
    Abstract: Real-time assessment of quarterly GDP growth rates is crucial for evaluation of economy’s current perspectives given the fact that respective data is normally subject to substantial publication delays by national statistical agencies. Large information sets of real-time indicators which could be used to approximate GDP growth rates in the quarter of interest are in practice characterized by unbalanced data, mixed frequencies, systematic data revisions, as well as a more general curse of dimensionality problem. The latter issues could, however, be practically resolved by means of dynamic factor modeling that has recently been recognized as a helpful tool to evaluate current economic conditions by means of higher frequency indicators. Our major results show that the performance of dynamic factor models in predicting Russian GDP dynamics appears to be superior as compared to other common alternative specifications. At the same time, we empirically show that the arrival of new data seems to consistently improve DFM’s predictive accuracy throughout sequential nowcast vintages. We also introduce the analysis of nowcast evolution resulting from the gradual expansion of the dataset of explanatory variables, as well as the framework for estimating contributions of different blocks of predictors into now-casts of Russian GDP.
    Keywords: GDP nowcast, dynamic factor models, principal components, Kalman filter, nowcast evolution
    JEL: C53 C82 E17
    Date: 2015–05–28
  9. By: Bukvić, Rajko; Makarov, Igor
    Abstract: English Abstract. The paper is addressed to one of the most famous man of Nizhny Novgorod at the end of XX and the beginning of XXI century, Dmitry Vasilevich Sirotkin, the last pre-revolutionary mayor of this city. The famous shipmanufacturer at Volga, later emigrant in Belgrade, he linked with his wonderful faith two great rivers, two cities and two nations. At the beginning of 1920s he came in Belgrade, became then the founder of inland navigation and shipbuilding in Serbia (on Danube). At this manner, Sirotkin's personality and activity linked not only two brother's cities – Nizhny Novgorod and Belgrade, bat also two brother's nations – Russians and Serbs, made with this the challenge to the next generations – highlight his not yet enough investigated life and activity. Particularly important is the second part of his life, that he was lived in capital of Serbia and Yugoslavia, that general not enough famous is, because he has not received enough recognitions in his second homeland. Russian Abstract. Статья посвящена одному из самых знаменитых людей Нижнего Новгорода конца 19 и начала 20 века, Дмитрию Васильевичу Сироткину, последнему предреволюционному мэру этого города. Известный судопромышленник на Волге, впоследствии эмигрант в Белграде, своей удивительной судьбой связал две великие реки, два города и два народа. Обосновавшись в начале 1920-х в Белграде, он явился основоположником судоходства и судостроительства в Сербии (на Дунае). Таким образом, личность и деятельность Сироткина связала не только два братских города – Нижний Новгород и Белград, но и два братских народа – русских и сербов, оставив вызов следующим поколениям – осветить его ещё недостаточно исследованную жизнь и деятельность. Особенно при этом важно исследование второй части его жизни, проведенной им в столице Сербии и Югославии, которая в общем-то недостаточно известна, из-за чего он и не получил достаточных признаний в своей второй родине.
    Keywords: Volga, Danube, Nizhny Novgorod, Belgrade, Sirotkin, Shukhov, shipmanufacturer, navigation Волга, Дунай, Нижний Новгород, Белград, Сироткин, Шухов, судопромышленник, судоходство
    JEL: N74 O14 R49
    Date: 2015–05–29
  10. By: Sergey Sinelnikov-Murylev (Russian Foreign Trade Academy); Pavel Trunin (RANEPA)
    Abstract: Both economic theory and economic practice reveal a high degree of interdependence between fiscal and monetary policies. This relationship is especially evident if the government accumulates a considerable amount of money in its accounts with the central bank. The article analyzes the impact of the formation and spending of the Reserve Fund and the National Wealth Fund on the monetary policy of the Bank of Russia. This effect is considered from the point of view of the current economic crisis and the need to spend resources accumulated in sovereign wealth funds. Length: 13 pages
    Keywords: Russian economy, fiscal policy, monetary policy, sovereign wealth funds, forex interventions, international reserves
    JEL: E43 E52 E62 E63
    Date: 2016
  11. By: Ò. A. Strelnikova (Russian Presidential Academy of National Economy and Public Administration - Stolypin Volga Region Institute of Administration)
    Abstract: The scorecard is interactive and it allows identifying the dynamics of the key indicators for rating of real estate market institutions in the RF since 2012 to 2014. The research was focused on the essential element of the real estate market - property right. The aim of the research was to investigate the level of legal protection of property right.
    Keywords: Scorecard, rating, international real estate markets, institutions of real estate market, legal system on property right protection, Global Competitiveness report, property right, guarantee ownership, registry, cadastral information, registration of property right, business environment.
    Date: 2015

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