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on Confederation of Independent States |
| By: | KUMO, Kazuhiro; SHADRINA, Elena |
| Abstract: | Hill and Gaddy (2004) argued that Zipf’s law or the rank-size rule was not observed for the urban systems in the Soviet Union. Having incorporated more comprehensive historical data for all cities in the former Soviet Union republics, the authors of this paper present the following findings. First, the Soviet hierarchical urban systems were evolving: in the late Imperial era and early Soviet period, they followed the Zipf’s law prediction, but they diverged from the rank-size rule possibly as a result of the World War II, and yet again they revealed converging to the traditional rank-size distribution trends in the late Soviet period; and second, this evolution was not necessarily the ultimate product of the policies developed by the command-administrative system. This paper confirms the former, although statistical verification of the effects of the Soviet urban policies on the urban hierarchical system in the USSR is the task ahead. |
| Keywords: | Zipf’s law, rank-size rule, urban hierarchical system, Soviet Union, Russia |
| JEL: | N93 N94 O18 P25 |
| Date: | 2021–05 |
| URL: | http://d.repec.org/n?u=RePEc:hit:rrcwps:91&r= |
| By: | Ali Enami (The University of Akron); Ugo Gentilini (World Bank); Patricio Larroulet (CEQ Institute and CEDES); Nora Lustig (Tulane University); Emma Monsalve (World Bank); Siyu Quan (Tulane University); Jamele Rigolini (World Bank and IZA) |
| Abstract: | Using microsimulations this paper analyzes the poverty and tax implications of replacing current transfers and subsidies by a budget-neutral (no change in the fiscal deficit) universal basic income program (UBI) in Brazil, Chile, India, Russia, and South Africa. We consider three UBI transfers with increasing levels of generosity and identify scenarios in which the poor are no worse off than in the baseline scenario of existing social transfers. We find that for poverty levels not to increase under a UBI reform, the level of spending must increase substantially with respect to the baseline. Accordingly, the required increase in tax burdens is high throughout. In our five countries and scenarios, the least increase in taxes required to avoid poverty to be higher than in the baseline is around 25% (Brazil and Chile). Even at this lower rate, political resistance and efficiency costs could limit the feasibility of a UBI reform. |
| Keywords: | Universal basic income, microsimulation, inequality, poverty, tax incidence |
| JEL: | H22 H31 H55 I32 D63 |
| Date: | 2021–05 |
| URL: | http://d.repec.org/n?u=RePEc:tul:wpaper:2108&r= |
| By: | Konstantins Benkovskis (Bank of Latvia); Olegs Tkacevs (Bank of Latvia); Karlis Vilerts (Bank of Latvia) |
| Abstract: | This paper analyzes the determinants of interest rate spreads during the period 2014–2020 in the euro area, with a focus on the Baltic countries. Against the background of accommodative monetary policy, interest rates on loans in the euro area have declined markedly, except in a few countries. In Latvia, Lithuania and Estonia, interest rates on new loans to non-financial corporations in 2020 were about the same as in 2014, and at the same time they were among the highest in the euro area. In this study, we apply the Ho and Saunders (1981) theoretical framework to identify explanatory factors of spreads and use the obtained econometric estimates to calculate the so-called pure spread by subtracting the influence of the bank funding structure and other bank-specific factors from the interest rate spread. Our study shows that even after accounting for the conventional determinants of interest rate spread, differences in the pure spread between euro area countries, especially between the Baltic countries and the rest of the euro area, persist. In part, these differences can be explained by varying degrees of financial sector market concentration. However, the bulk of the gap in spreads remains unexplained. The findings of this paper suggest that properly designed policy measures are needed to reduce spreads in the Baltic countries and lessen the fragmentation in the euro area. This would allow for more effective monetary policy transmission and stimulate lending and post-Covid economic recovery in the Baltics. |
| Keywords: | tax interest rate spread, interest rate on loans, market concentration |
| JEL: | G21 L11 E43 E52 |
| Date: | 2021–05–18 |
| URL: | http://d.repec.org/n?u=RePEc:ltv:dpaper:202102&r= |
| By: | Rikhotso, Prayer; Bonga-Bonga, Lumengo |
| Abstract: | This paper assesses the impact of misalignment on the current accounts of BRICS countries using the empirical approaches that address the issue of model uncertainty and asymmetry. The results of the empirical analysis empirical confirm that the relationship between misalignment and current account is asymmetric in that overvaluation of BRICS currencies deteriorate the current account and undervaluation does improve it. Moreover, the results of the empirical analysis advocate the use of real effective exchange rate as an effective macroeconomic policy instrument to enhance relative export competitiveness in BRICS. Further studies in this area should examine the impact of marginal propensity to import and how each country’s propensity to import affects the current balance given episodes of overvaluation and undervaluation. |
| Keywords: | currency misalignment, current account, feasible generalised least square |
| JEL: | C11 C5 C51 F14 F32 |
| Date: | 2021–05–12 |
| URL: | http://d.repec.org/n?u=RePEc:pra:mprapa:107973&r= |
| By: | VINTU, Denis |
| Abstract: | This article reconsiders the developing of a new forecast model using the interrupted timeseries of the gross domestic product for the Republic of Moldova. The theme arises from a first need to redefine, economic growth in the context of increasing globalization but also the complexity of commercial transactions. The forecasting method used is based on ARIMA each model partly emphasizing the urgent need to redefine, the economic growth in the context of the Association Agreement (AA) with the EU, which includes a Comprehensive Free Trade Agreement (2014) but also future prospects of integration among the countries with an average degree of development. The technique used comes to bring novelty in the field of forecasting, as an alternative to the one which should be —, a simultaneous equations method and traditional VAR. The policy and practical implications of the results are the strengths. The limits are due to the high degree of risk and uncertainty, which is due to the low degree of real convergence of the economy, but also to other factors such as the regional context, the lack of openness of the economy, the diversification of exports and services. The degree of complexity arises from the adaptation and study of the chronological interrupted series 1967−2019 for the branch – information and communications, subgroup GDP, categories of resources, which themselves have specific asymmetries and nuances. The basic ARIMA equations are generally used in conjunction with three sets of assumptions regarding the formation of the gross domestic product, referring to the elasticity of aggregate demand or excess sensitivity supply in the goods and labour markets. Another hypothesis concerns the rigid wage and sticky prices, including deflation with an positive output gap only in the telecom market. Also, the salary is rigid, while the price level is adjusted based on the market of goods and commodities, so that the excess supply appears only in the labour market. Finally, in a third assumption, both markets are assumed to be mutually adjusted. The multipliers of fiscal and monetary policy, besides the conclusions that can be drawn about economic policy, are obviously different in these three assumptions. The article presents a synthetic model that supports the three particular sub-regimes of assumptions of a single adapted ARIMA model, namely the trajectory of New Keynesian Small and Closed Economy Model – a balance in the goods and services, the labour market and the national financial system. In conclusion, the model aims not only to redefine the area of macroeconomic forecasting but also to offer a future perspective of adopting combined techniques such as the Stochastic Dynamic General Equilibrium (K-SDGE) Model with sticky prices and wages – technique, but also the scenario method. This framework is appealing because it has straight forward model setup, transparent mechanisms, sharp empirical analysis, and multiple important applications such as rational expectations. |
| Keywords: | economic growth and aggregate productivity, the gross domestic product, innovation and communications, cross-country output convergence, prediction and forecasting methods,time series analysis and modelling, ARIMA modelling, Box-Jenkins method. |
| JEL: | C12 C14 C22 C53 D62 D84 F15 F21 F61 O10 O30 |
| Date: | 2021–04–23 |
| URL: | http://d.repec.org/n?u=RePEc:pra:mprapa:107603&r= |
| By: | Matoshi, Ruzhdi; Mulaj, Isa |
| Abstract: | Transition economics was and still is a topic mostly associated with the post-communist countries in Central and Eastern Europe (CEE). The cause of its emergence as a theory was not purely economic – the spearhead was politics – leading to the collapse of the Eastern Block, to be followed by the disintegration of three federal states: Soviet Union, Yugoslavia, and Czechoslovakia, with many civil wars and ethnic conflicts. The experience proved a relaxation to the Western liberal developed democracies as it strengthened the belief of their superior model which the transition economies want to embrace. First of all, the transition provided a new opportunity for interaction between European East and West. On the eve of its 30th anniversary, with more than half of these countries experiencing “the end of transition” and joining the European Union (EU) while the rest considered not yet meeting the “standards”, another transition is on the way, and this one not going into but coming out from the EU, Brexit respectively. Just like in former communist countries, it too, originated from politics, namely the results of 23.06.2016 referendum results that decided for the withdrawal of the United Kingdom (UK) from the EU, a move that is about to force considerable changes in the economy, already labelled as “transition.” Although an intensive phase of research and debate is underway, the aim of this paper is to explore the implications of Brexit in terms of its international economics and contribute to a more general theory of transition economics which so far has been reserved for, and as a reference to, post-communist countries in CEE. |
| Keywords: | CEE, transformation, transition economics, Brexit, EU, general theory |
| JEL: | F15 N44 O33 P16 P27 P33 |
| Date: | 2020–10–30 |
| URL: | http://d.repec.org/n?u=RePEc:pra:mprapa:107852&r= |