nep-tra New Economics Papers
on Transition Economics
Issue of 2006‒05‒27
nine papers chosen by
Tono Sanchez
Universitat de Valencia

  1. Disparity in Factor Contributions between Coastal and Inner Provinces in Post-reform China By Tung Liu; Kui-Wai Li
  2. Rational Alcohol Addiction: Evidence from the Russian Longitudinal Monitoring Survey By Badi H. Baltagi; Ingo Geishecker
  3. Chicken or egg: financial development and economic growth in China, 1992-2004 By Fan, Xuejun; Jacobs, Jan; Lensink, Robert
  4. How globalised really is European trade? By T. Huw Edwards
  5. Integration Of Smaller European Equity Markets : A Time-Varying Integration Score Analysis By Gregory Birg; Brian M. Lucey
  6. Technical Change and Total Factor Productivity Growth for Chinese Provinces: A Panel Data Analysis By Alice Shiu; Almas Heshmati
  7. Is foreign exchange intervention effective? Some micro-analytical evidence from the Czech Republic By Antonio Scalia
  8. Preferences, Poverty and Politics: Experimental and Survey Data from Vietnam By Tomomi Tanaka; Colin F. Camerer; Quang Nguyen
  9. Does access to credit improve productivity ? Evidence from Bulgarian firms By Love, Inessa; Gatti, Roberta

  1. By: Tung Liu (Department of Economics, Ball State University); Kui-Wai Li (City University of Hong Kong, Hong Kong SAR)
    Abstract: The paper discusses China’s post-reform regional economic growth imbalance relative to input disparity in technology, physical and human capital. Institutional sources of finance and types of ownership are used to construct physical capital. Technology is measured by investment in innovation, and human capital is constructed from schooling years per capita. The results show that domestic bank loans and foreign-owned enterprises are important in coastal provinces, while state appropriation and state-owned enterprises are important in inner provinces. Technology and foreign investment have a larger impact on output growth in coastal provinces. Human capital is endogenous for coastal provinces, but is exogenous for inner provinces.
    Keywords: Mainland China, regional disparity, physical and human capital, productivity
    JEL: C22 I22 O18 O47 O53 P24
    Date: 2005–06
  2. By: Badi H. Baltagi (Syracuse University and IZA Bonn); Ingo Geishecker (Free University of Berlin)
    Abstract: Alcohol consumption in Russia is legendary and has been reported to be the third leading cause of death in the former Soviet Union after heart disease and cancer. Are Russian alcohol consumers rational addicts? This paper uses eight rounds of a nationally representative Russian survey spanning the period 1994-2003 to estimate a rational addiction (RA) model for alcohol consumption. This is done in a panel data setting as well as on a wave by wave basis. The profile of the Russian drinker finds a huge difference between males and females and the model is estimated by gender. We do not find support for the RA model in Russia for women. For men, although we find that some implications of the RA model are satisfied, we fail to endorse the model empirically on grounds of implausible negative estimates of the discount rate.
    Keywords: panel data, liquor consumption, rational addiction
    JEL: C23 D12 I10
    Date: 2006–05
  3. By: Fan, Xuejun; Jacobs, Jan; Lensink, Robert (Groningen University)
    Abstract: This paper contributes to the empirical finance-growth literature by examining the relationship between financial depth, banking sector development, stock market development and economic growth in China. After an extensive survey on recent financial reforms in China, we apply Granger (non-)causality tests for non-stationary variables to examine long-run and short-run causality between economic growth and financial development. We find positive relationships between financial depth, banking sector development and growth. However, stock market development does not seem to have a positive effect on long-run economic growth.
    Date: 2005
  4. By: T. Huw Edwards (Loughborough University)
    Abstract: Using a new set of measures of concentration of trade, I suggest that the opening up of trade to date has been greatly exaggerated. At least judging on the basis of trade concentration, agriculture and service sectors should barely be seen as globalised at all. Contrary to other recent studies, Europe's main economies lag behind the USA in terms of global openness, and most are behind Japan, Canada and China. The Balkans, Poland and Czech Republic are near the bottom end of the global openness league table. Since there is a strong correlation between concentration of trade and poor economic performance, this should be of concern to those countries and to the European Union.
    Keywords: Globalisation, Regional Integration, Trade, Europe.
    JEL: F10 F15 C49
    Date: 2006–05
  5. By: Gregory Birg; Brian M. Lucey
    Abstract: The objective of this paper is to study capital market integration in smaller european countries and its implications for an international portfolio investment allocation. A time-varying analysis based on Barari (2004) suggests that the markets have recently started moving towards international financial integration. Results vary from country to country and sample countries can be broken down into distinctive groups according to their recent integration score performance: a) countries which are becoming increasingly integrated with both regional European and international equity markets (Estonia, Hungary, Czech Republic, Lithuania, Poland) b) countries which have becoming increasingly integrated with the regional market, while growing segmented with the world market (Latvia, Slovakia, Slovenia). This is an encouraging indicator in that none of the countries have been growing segmented from the European equity markets since the EU accession.
    Keywords: Stock Market Integration, Portfolio Diversification, Smaller European markets, Time-varying methods.
    Date: 2006–05–23
  6. By: Alice Shiu (Hong Kong Polytechnic University); Almas Heshmati (TEPP, Seoul National University, RATIO Institute and IZA Bonn)
    Abstract: We present in this paper the panel econometrics estimation approach of measuring the technical change and total factor productivity (TFP) growth of 30 Chinese provinces during the period of 1993 to 2003. The random effects model with heteroscedastic variances has been used for the estimation of the translog production functions. Two alternative formulations of technical change measured by the single time trend and the general index approach are used. Based on the measures of technical change, estimates of TFP growth could be obtained and its determinants were examined using regression analysis. The parametric TFP growth measure is compared with the non-parametric Solow residual. TFP has recorded positive growth for all provinces during the sample period. Regional breakdown shows that the eastern and central regions have higher average TFP growth when compared with the western region. Foreign direct investment (FDI) and information and communication technology (ICT) investment are found to be significant factors contributing to the TFP difference. While these two factors are found to have significant influence on TFP, their influence on production is relatively small compared to traditional inputs of production.
    Keywords: technical change, TFP growth, provinces, China, ICT, FDI, infrastructure
    JEL: C23 D24 E22 O18 O47
    Date: 2006–05
  7. By: Antonio Scalia (Banca d’Italia)
    Abstract: I estimate a two-equation system on the euro-Czech koruna exchange rate and order flow at hourly frequency within the framework of Evans-Lyons (JME 2002). I use transac-tions data from the Reuters Spot Matching market in the second half of 2002, during which the Czech National Bank conducted discreet interventions to stem the appreciation of the domestic currency. I find a significant impact of order flow on the exchange rate, equal on average to 7.6 basis points per €10 million, of which 80 percent persists through the day. The news of intervention increases the price impact of order flow by 3.9 basis points per €10 million, consistently with the notion of intervention efficacy. The order flow equation yields in-conclusive results.
    Keywords: Foreign exchange, central bank intervention, Czech koruna, ERM II, empirical microstructure
    JEL: E65 F31 G15
    Date: 2006–02
  8. By: Tomomi Tanaka; Colin F. Camerer; Quang Nguyen
    Date: 2006–05–14
  9. By: Love, Inessa; Gatti, Roberta
    Abstract: Although it is widely accepted that financial development is associated with higher growth, the evidence on the channels through which credit affects growth on the micro-level is scant. Using data from a cross section of Bulgarian firms, the authors estimate the impact of access to credit (as proxied by indicators of whether firms have access to a credit or overdraft facility) on productivity. To overcome potential omitted variable bias of OLS estimates, they use information on firms ' past growth to instrument for access to credit. The authors find credit to be positively and strongly associated with total factor productivity. These results are robust to a wide range of robustness checks.
    Keywords: Banks & Banking Reform,Economic Theory & Research,Investment and Investment Climate,Economic Growth,Financial Intermediation
    Date: 2006–05–01

This nep-tra issue is ©2006 by Tono Sanchez. It is provided as is without any express or implied warranty. It may be freely redistributed in whole or in part for any purpose. If distributed in part, please include this notice.
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