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on Central and Western Asia |
| By: | Bruns, Stephan B. (Max Planck Institute of Economics); Gross, Christian (E.ON Energy Research Center, Future Energy Consumer Needs and Behavior (FCN)) |
| Abstract: | Time series of electricity, petroleum products, and renewables are found to be highly correlated with total energy consumption. Applying this insight to the huge literature on energy-GDP causality explains that the results of energy-GDP causality tests frequently coincide with the results of energy type-GDP tests. Using the test by Toda-Yamamoto in combination with a cointegration-based testing approach, we detect such cases of concordance for 92 per cent of the countries in our sample of 65 countries. As a consequence, it is difficult to draw specific economic conclusions regarding single types of energy from bivariate causality analysis. |
| Keywords: | Energy; GDP; Granger causality; Correlation; Electricity; Petroleum products; Renewables; Toda-Yamamoto; Johansen-Juselius |
| JEL: | C32 C52 Q43 |
| Date: | 2013–09–26 |
| URL: | http://d.repec.org/n?u=RePEc:ris:fcnwpa:2013_010&r=cwa |
| By: | ZHANGALIYEVA, Aigerim; NAKABAYASHI, Masaki (Institute of Social Science, The University of Tokyo) |
| Abstract: | Employers use educational background as a signal of a workerfs latent ability. This signaling effect decreases as employers learn about the workerfs ability with his/her work experience, which results in negative coefficient of interaction term between schooling and experience in wage equation. Meanwhile, if schooling and experience are complements, it works to make the coefficient positive. We show the latter complementarity effect dominates for vocational school graduates school in Russia. Given that European vocational school systems were introduced from the Russian Empire, our results at least partly explain why employer learning is only weakly observed in Europe. |
| Keywords: | Signaling; employer learning; complementarity of schooling and experience; vocational school; Russia. |
| JEL: | J31 J24 |
| Date: | 2013–09–26 |
| URL: | http://d.repec.org/n?u=RePEc:itk:issdps:f163&r=cwa |
| By: | Majeed, Dr. Muhammad Tariq |
| Abstract: | This study analyzes the impact of trade on cross-country inequality using a panel data set from 65 developing counties over a long period 1970-2008. This study differs from the existing literature on distributional impact of trade by explicitly noting the importance of development stage in shaping the link. The analysis shows that the effect of trade on inequality depends upon the level of development of a trade integrating economy. Economies that have a high level of economic development acquire a favorable effect of trade while underdeveloped economies suffer from international economic integration. In sum, trade accentuates not ameliorate inequality in countries with low level of economic development. |
| Keywords: | Trade; Development; Inequality; Developing Countries |
| JEL: | C23 D31 F41 |
| Date: | 2013–10–02 |
| URL: | http://d.repec.org/n?u=RePEc:pra:mprapa:50337&r=cwa |
| By: | Özgür Bor (Atýlým University, Turkey); Mustafa Ýsmihan (Atýlým University, Turkey) |
| Abstract: | This study analyzes the role of tax policy in gasoline prices in Turkey by utilizing time series techniques. It provides and compares empirical results by using daily gasoline prices between January 2005 and July 2012, with and without the effect of taxation. Our results, based on the standard asymmetric error-correction model, indicate no evidence of asymmetry in retail gasoline prices, which implies that the government does not benefit from the adjustment of gasoline prices through taxation. However, one can miss the big picture in gasoline pricing by concentrating only on the short term price adjustment dynamics via error-correction models. Therefore, we analyzed the long-run relationships between crude oil and gasoline prices with and without taxes. The results indicate that Turkish government succeeded at implicitly imposing an exceptionally high tax burden on gasoline (about 70%) over the longer term by adjusting non-salient excise tax amounts on gasoline and benefited from the resultant tax revenues as means of public finance. |
| Date: | 2013 |
| URL: | http://d.repec.org/n?u=RePEc:tek:wpaper:2013/7&r=cwa |
| By: | Morgan, Peter J. (Asian Development Bank Institute) |
| Abstract: | This paper reviews the history of East Asian monetary policy frameworks since 1990; describes current monetary policy frameworks, including issue of price versus financial stability for a central bank and the policies a central bank can use to manage financial stability; the monetary policy transmission mechanism based on financial linkages and financial deepening; assesses policy outcomes including inflation targeting and responses to the “Impossible Trinity”; and makes overall conclusions. The paper finds that East Asian central banks have managed inflation and growth well over the past decade, but the difficulties faced by central banks of advanced countries in the aftermath of the GFC suggests that not all problems have been solved. |
| Keywords: | monetary policy; macroprudential policy; inflation targeting; financial stability; currency regime; capital flows; emerging economies |
| JEL: | E52 E58 F31 F32 G18 |
| Date: | 2013–09–27 |
| URL: | http://d.repec.org/n?u=RePEc:ris:adbiwp:0435&r=cwa |
| By: | Lee, Hyun-Hoon (Kangwon National University); Park, Donghyun (Asian Development Bank) |
| Abstract: | The central objective of this paper is to empirically assess how global imbalances have evolved since the global financial crisis of 2008/09. More specifically, we examine how the security investment positions of major East Asian economies in United States (US) financial markets—equities, bonds, and bank lending—changed after the crisis. Our econometric analysis, which is based on the gravity model to identify the determinants of foreign portfolio investment in the US, finds that the "overinvestment" of most East Asian economies in the US has remained substantial after the global financial crisis, especially in long-term bonds. That is, even after the crisis, most East Asian economies continue to hold excessive amounts of US securities, but the degree of overinvestment appears to have declined for some economies such as the PRC. However, the PRC still has the largest excessive holdings of US securities. We also find that East Asian economies over-invest in US financial markets largely due to excessive savings and foreign exchange reserves. |
| Keywords: | Global financial crisis; global imbalances; US; East Asia; portfolio investment |
| JEL: | F21 F32 F34 F42 |
| Date: | 2013–08–01 |
| URL: | http://d.repec.org/n?u=RePEc:ris:adbrei:0118&r=cwa |
| By: | Ivanov, Alexey |
| Abstract: | In the article the situation on the Russian market of mergers and acquisitions in 2005-2012 is investigated. Also was produced its comparison with the world market for key indicators. The author based on extensive statistical analysis of the material revealed the specific features and tendencies of development of the domestic market of mergers and acquisitions, and emphasized the role of integrative synergetic effect in the expectations of investors. |
| Keywords: | слияния и поглощения, интеграция, синергетический эффект, mergers and acquisitions, integration, synergetic effect |
| JEL: | O30 |
| Date: | 2013–08–23 |
| URL: | http://d.repec.org/n?u=RePEc:pra:mprapa:50304&r=cwa |
| By: | Metin M. Cosgel (University of Connecticut) |
| Abstract: | An expanding state has to decide how to tax the newly conquered lands, most likely taxed under a different regime. It can either preserve the prevailing system of taxation or change it to conform to its own system. The choice depends on the relative efficiency of the two systems, political constraints, and the political legitimacy of the ruler (formulated here as his ability to collect the tax revenue). This paper examines the problem of how an expanding state would establish a fiscal regime by focusing on the tax system of the Ottoman Empire during its expansion between the fourteenth and sixteenth centuries. After outlining the general structure of the Ottoman system of taxation, it develops a simple theoretical framework to analyze the political economy of an expanding state's choice of a fiscal regime, applies this framework to the Ottoman Empire, and analyzes the interaction between tax rates and bases in a more specific context, namely the system of discriminatory taxation that the Ottomans inherited in the Fertile Crescent. |
| Keywords: | fiscal regime, taxation, conquest, state, political economy, religion, legitimacy, loyalty, constraints, power |
| JEL: | D8 H2 J4 L3 M5 N4 |
| Date: | 2013–09 |
| URL: | http://d.repec.org/n?u=RePEc:uct:uconnp:2013-28&r=cwa |
| By: | Nuno Rosa Reis (Instituto Politécnico de Leiria); Manuel Portugal Ferreira (Instituto Politécnico de Leiria); João Carvalho Santos (Instituto Politécnico de Leiria) |
| Abstract: | Culture and the influence of national cultures and cultural differences have been widely studied in International Business (IB) research especially over the past three decades. To better understand what culture actually means and its implications on firms’ international operations, several cultural models and taxonomies have been put forward. In this paper we review the main cultural models in the extant IB research – Hofstede’s (1980), Hall’s (1976) and Troompenaars’ (1993) – and Kogut and Singh’s (1988) concept of cultural distance. In a bibliometric study of over 3,600 articles published in seven top ranked journals for IB research, we examine citations and co-citations to assess the relative use of the cultural models and the ties binding authors and theories studied. This study offers a wealth of information on the current state of IB-related research using culture that may be used to better understand the intellectual structure of the sub-field of cultural issues in IB studies but also to identify gaps for future inquiry. The results help setting a profile of the network of knowledge and permit us conclude that Hofstede’s (1980) taxonomy on cultural characteristics is the most cited cultural taxonomy and holds ties to many of the core streams of IB-related research. In fact, despite the well-known criticisms, there is an increasing use of Hofstede’s dimensions. |
| Keywords: | Cultural models, Hofstede, Trompenaars, Hall, review, bibliometric study |
| JEL: | M0 M1 |
| Date: | 2013–09–29 |
| URL: | http://d.repec.org/n?u=RePEc:pil:wpaper:104&r=cwa |
| By: | Jürgen Rüttgers (Former Minister of Education, Science, Research and Technology in the government of Chancellor Helmut Kohl. Former Prime Minister of North Rhine Westphalia. Former Prime Minister Honorary Professor of Ben-Gurion University of the Negev Honorary Professor of the Maastricht School of Management) |
| Date: | 2013–09 |
| URL: | http://d.repec.org/n?u=RePEc:msm:wpaper:2013/29&r=cwa |
| By: | Aysit Tansel (Middle East Technical University Department of Economics, Institute for the Study of Labor (IZA) Bonn, Economic Research Forum (ERF) Cairo) |
| Abstract: | This paper aims to provide the recent developments on the supplementary education system in Turkey. The national examinations for advancing to higher levels of schooling are believed to fuel the demand for Supplementary Education Centers (SEC). Further, we aim to understand the distribution of the SECs and of the secondary schools across the provinces of Turkey in order to evaluate the spacial equity considerations. The evolution of the SECs and of the secondary schools over time are described and compared. The provincial distribution of the SECs, secondary schools and the high school age population are compared. The characteristics of these distributions are evaluated to inform the about spatial equity issues. The distribution of high school age population that attend secondary schools and the distribution of the secondary school students that attend SECs across the provinces are compared. The evidence points out to significant provincial variations in various characteristics of SECs and the secondary schools. The distribution of the SECs is more unequal than that of the secondary schools. The provinces located mostly in the east and south east of the country have lower quality SECs and secondary schools. Further, the SEC participation among the secondary school students and the secondary school participation among the relevant age group are lower in some of the provinces indicating major disadvantages. The review of the most recent developments about the SECs, examination and comparison of provincial distributions of the SECs and of the secondary schools are novelties in this paper. |
| Keywords: | Supplementary Education, Demand for Education, Turkey. |
| JEL: | I20 I21 I22 |
| Date: | 2013–10 |
| URL: | http://d.repec.org/n?u=RePEc:koc:wpaper:1319&r=cwa |
| By: | Larsson, Simon; Fantazzini, Dean; Davidsson, Simon; Kullander, Sven; Hook, Mikael |
| Abstract: | A thorough review of twelve recent studies of production costs from different power generating technologies was conducted and a wide range in cost estimates was found. The reviewed studies show differences in their methodologies and assumptions, making the stated cost figures not directly comparable and unsuitable to be generalized to represent the costs for entire technologies. Moreover, current levelized costs of electricity methodologies focus only on the producer's costs, while additional costs viewed from a consumer perspective and on external costs with impact on society should be included if these results are to be used for planning. Although this type of electricity production cost assessments can be useful, the habit of generalizing electricity production cost figures for entire technologies is problematic. Cost escalations tend to occur rapidly with time, the impact of economies of scale is significant, costs are in many cases site-specific, and country-specific circumstances affect production costs. Assumptions on the cost-influencing factors such as discount rates, fuel prices and heat credits fluctuate considerably and have a significant impact on production cost results. Electricity production costs assessments similar to the studies reviewed in this work disregard many important cost factors, making them inadequate for decision and policy making, and should only be used to provide rough ballpark estimates with respect to a given system boundary. Caution when using electricity production cost estimates are recommended, and further studies investigating cost under different circumstances, both for producers and society as a whole are called for. Also, policy makers should be aware of the potentially widely different results coming from electricity production cost estimates under different assumptions. |
| Keywords: | Electricity generation costs, levelized costs, energy market analysis, cost comparisons, policy implications |
| JEL: | L94 Q00 Q20 Q30 Q40 Q48 |
| Date: | 2013–09 |
| URL: | http://d.repec.org/n?u=RePEc:pra:mprapa:50306&r=cwa |
| By: | Demachi, Kazue |
| Abstract: | This paper analyzes the influence of international resource price movements on capital outflows from resource-rich developing countries (RRDCs) by distinguishing capital flight and capital transfers. The volume of capital flight and transfers are calculated and their determinants are analyzed using macro-panel data constituting 21 resource-rich developing countries from 1990 to 2011. Through the regression analysis, the linkage between capital flight and resource revenue as well as that between capital flight and debt is suggested. The results of this analysis suggest the need to focus on capital outflow from RRDCs through transnational companies. |
| Keywords: | Africa, Asia, capital flight, resource rich developing countries |
| JEL: | F21 F23 |
| Date: | 2013–09–29 |
| URL: | http://d.repec.org/n?u=RePEc:pra:mprapa:50273&r=cwa |
| By: | Pal, Sarmistha (University of Surrey) |
| Abstract: | The present paper argues that the effect of corruption on foreign ownership is not necessarily linear and depends on the level of host corruption. So long as the expected returns from foreign investments exceed its expected costs, higher host corruption will be associated with higher foreign ownership. However, costs may exceed or exactly compensate the returns to foreign investment at very high level of corruption, giving rise to negative or even an insignificant relationship when positive and negative effects outweigh each other. Further, we argue that this non-linear corruption effects may arise from multinational firms' attempts to investing in countries with similar environment and/or ensuring some formal networking with host countries in a bid to limit the damages caused by high level of host corruption. Panel fixed effects estimates (after correcting for foreign entry selection) using a recent large home-host matched panel data from central and eastern European host countries provide some support to these hypotheses: (i) higher corruption is associated with significantly higher foreign ownership unless corruption is at its fourth quartile value. (ii) There is also some confirmation that this non-linear corruption effects is linked to parent firms' attempts to ensure institutional similarity while investing in corrupt host countries: in particular, foreign multinationals from EU/OECD home countries tend to hold higher ownership in EU/OECD host countries and also when the home-host relative corruption distance is small. |
| Keywords: | corruption, relative corruption, EU/OECD home-host link, foreign ownership, joint venture vs sole subsidiaries, Central and Eastern Europe |
| JEL: | F23 G32 L24 O17 P33 |
| Date: | 2013–09 |
| URL: | http://d.repec.org/n?u=RePEc:iza:izadps:dp7636&r=cwa |
| By: | FERRAGINA, Anna Maria (CELPE - Centre of Labour Economics and Economic Policy, University of Salerno - Italy) |
| Abstract: | This report summarizes the findings of a research project using firm level data on Italian and Turkish manufacturing industries. In this project we study the dynamics of firm survival and growth, and the spillover effects from foreign-owned to domestic firms. First, we investigate the differences in survival patterns of foreign-owned and domestic firms and test the hypothesis that foreign multinational enterprises (FMNEs) display “foot-loose” behavior. Secondly, we analyse the effects of FDI on the survival and growth prospects of domestic firms by disentangling horizontal and vertical spillovers. We use hazard models for the econometric analysis of firm survival and the system-GMM and Heckman selection models for the analysis of firm (employment) growth. In the case of Italy, a comparison of survival rates of domestic and foreign firms shows that foreign firms are more likely to survive than domestic firms, although the survival rates of foreign firms are not much different than those of Italian multinational firms. To check for a more general applicability of this preliminary finding, we estimate the hazard functions for the domestic and foreign firms, controlling for a number of sector-specific and firm-specific characteristics. The results reveal that foreign firms are more “foot-loose” compared to their domestic counterparts while Italian multinationals exhibit lower hazard rates with respect to both domestic non-multinational firms and to foreign multinationals. Besides, the foreign firms’ likelihood of exit compared to domestic firms is higher in sectors with low technology- and knowledge-intensity. In the Turkish case, the simple comparison of survival rates also highlights that foreign firms are more likely to survive than Turkish firms, although the survival rates of foreign firms are not different from those of large domestic firms. Since foreign firms usually start with a larger size, use more capital-intensive technologies, survival rates may reflect the impact of entry characteristics. The hazard function estimates reveal that, when we control for sector-specific variables, foreign firms still have higher survival probabilities, but once firm-specific variables are included in the hazard function model, they appear more “foot-loose” for the 1983-2001 period. Foreign firms are more likely to survive than the domestic firms in the 2003-2009 period even after firm-specific variables are taken into account, but the inclusion of firm-specific variables reduces the impact of foreign ownership on the likelihood of survival considerably. These results for Italy and Turkey indicate that foreign ownership has not necessarily a positive impact on firm survival. Conversely, there is evidence that multinational experience matters for survival because multinational firms have larger size and may employ more capital-intensive technologies thanks to their superior financial strength and experience in other markets. Other firm-level characteristics (size, skill level, etc) are also crucial for survival. The exit behavior of foreign firms is also quite related to the technological environment due to the role played by opportunity costs, which are more relevant in low-tech industries, and by sunk investments costs, which (on average) are lower in more traditional sectors. The mixed results for Turkey across the two periods considered also highlight the importance of the institutional setting for firm survival and growth. Turkey experienced two different policy and growth regimes in the 1990s and 2000s. The 1990s, which is labeled by some researchers as the “lost decade”, is characterized by extreme uncertainty and boom-and-bust cycles, whereas the Turkish economy achieved a high and stable growth performance in the 2000s. In terms of industrial policy, the foot-loose behavior of foreign multinationals should be taken into account in designing investment incentives to attract foreign multinationals also pursuing sector specific policies and institutional reforms ensuring that managers have the right incentives to make long-term investment and to enhance absorptive capacity development. Besides, to improve the likelihood of firm survival, policy makers should target firm-specific characteristics that are crucial determinants of performance gaps in survival, primarily size, productivity and multinational activities. Concerning the issue of how the presence of foreign firms affects the domestic firms’ survival and employment growth, our findings suggest that there is a huge degree of heterogeneity across firms, periods and sectors in both countries. However, positive evidence in favour of positive spillovers is not overwhelming. In the case of Italy, the survival of domestic firms is positively affected by the increased presence of foreign firms within the same industry, but this only occurs in low- and medium-low tech industries. This result may be due to the fact that domestic firms in medium-high tech industries have not enough absorptive capacity to benefit from FDI spillovers. The relevance of domestic firms’ absorptive capacity for spillover effects is confirmed by our analysis: only domestic firms that have smaller technology gap vis-à-vis foreign firms benefit from significant horizontal and vertical (upstream) spillovers on survival. From the system GMM growth estimates we find that, in terms of FDI spillovers, there is evidence of a negative impact on domestic firms employment growth if the foreign firm share in the region employment increases (negative local spillovers), .and a negative employment impact for firms with a higher technology gap is detected if the foreign firm share in the sector increases. For Turkey, the regional share of foreign firms has a weak negative static impact on the survival rate, and an increase in the share of foreign firms in a sector also has a negative impact on survival in the 2003-2009 period. The foreign share of users seems to have positive coefficients, i.e., domestic firms will be more likely to survive if users are foreign, but these results are statistically significant only if firm-specific effects are not controlled for in the 2003-2009 period. Moreover, there is some evidence of a negative effect on survival if downstream firms are foreign in the 2003-2009 period. Regarding firm growth, foreign suppliers and change in regional share of foreign firms have strong negative impact on domestic firms' growth rates, i.e., those firms supplied by upstream foreign firms, and those firm operating in regions with an increasing foreign presence experience lower growth rates. There is also a weak negative impact of sectoral foreign share on growth whereas a weak positive impact is observed for the change in sectoral foreign share. These results do not support the broad conclusion that FDI have positive impact on firms’ indigenous survival and growth dynamics. Conversely, our findings provide not a favorable picture in terms of the balance between displacement/competition versus spillover effects of FDI on domestic firms. We also obtain evidence indicating that the interaction between the presence of foreign firms and domestic firm survival is markedly affected by the technological environment that shapes up domestic firms’ absorptive capacity. The displacement effect in dynamic industries implies that the damage is concentrated on high-tech firms, which should be the higher quality segment of national production. In terms of industrial policy, this implies that the desire to encourage FDI and simultaneously building up a stable supply of indigenous enterprises is more challenging in dynamic sectors, where a trade-off in terms of these objectives appears to exist. |
| Keywords: | International investment; Multinational firms; Duration analysis; Firm performance; International Linkages to Development |
| JEL: | C41 F21 F23 L25 O19 |
| Date: | 2013–10–01 |
| URL: | http://d.repec.org/n?u=RePEc:sal:celpdp:0127&r=cwa |