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on Transition Economics |
| By: | Martin Brown; Tullio Jappelli; Marco Pagano (-) |
| Abstract: | We investigate whether information sharing among banks has affected credit market performance in the transition countries of Eastern Europe and the former Soviet Union, using a large sample of firm-level data. Our estimates show that information sharing is associated with improved availability and lower cost of credit to firms. This correlation is stronger for opaque firms than transparent ones and stronger in countries with weak legal environments than in those with strong legal environments. In cross-sectional estimates, we control for variation in country-level aggregate variables that may affect credit, by examining the differential impact of information sharing across firm types. In panel estimates, we also control for the presence of unobserved heterogeneity at the firm level, as well as for changes in macroeconomic variables and the legal environment. |
| Keywords: | information sharing, credit access, transition countries |
| JEL: | D82 G21 G28 O16 P34 |
| Date: | 2008–04–07 |
| URL: | http://d.repec.org/n?u=RePEc:prt:dpaper:3_2008&r=tra |
| By: | Edgar L. Feige; Ivica Urban |
| Abstract: | This paper compiles alternative estimates of underground economies in twenty five transition countries during the transition decade and finds a disturbing lack of convergence between them, calling into question the reliability of GDP figures (which in varying degrees now include non-transparent imputations for the “nonobserved economy”) as well as the macro model estimates of the unrecorded economy. |
| Keywords: | Underground, unrecorded, unobserved, non-observed, NOE, hidden, informal, shadow, GDP, national accounts, transition economies. |
| JEL: | E26 E01 O17 P24 H26 O11 |
| URL: | http://d.repec.org/n?u=RePEc:wdi:papers:2008-913&r=tra |
| By: | Krishna Chaitanya,; Emilia Vazquez Rozas |
| Abstract: | Emerging economies viz., Brazil, China, India, Mexico and South Africa have seen a tremendous increase in the FDI inflows in the last one decade. Amongst all, the FDI inflows of China witnessed sharp rise from 1992. As on 2006, China stood as the world’s second largest recipient of FDI inflows (AT Kearney Report, 2006), leaving behind many emerging economies in the race of attracting FDI inflows. |
| Keywords: | FDI inflows, Emerging economies, China & Cointegration. |
| JEL: | F21 O57 E44 C22 |
| Date: | 2008–12–01 |
| URL: | http://d.repec.org/n?u=RePEc:wdi:papers:2008-904&r=tra |
| By: | Valentina Hartarska; Denis Nadolnyak |
| Abstract: | This paper applies the financing constraint approach to study whether microfinance institutions improved access to credit for microenterprises in Bosnia and Herzegovina. According to this approach, microenterprises with improved assess to credit rely less on internal funds for their investments. Thus, we compare investment sensitivity to internal funds of micorenterprises in municipalities with significant presence of MFIs to that of micorenterprises in municipalities with no (or limited) presence of MFIs using Living Standards Measurement Survey and MFI branch location data. Results indicate that MFIs alleviated microbusinesses’ financing constraint. This approach is applicable to evaluating microfinance impact in other countries. |
| Keywords: | microfinance, impact study, Microfinance Institutions, financing constraints, Eastern Europe, Bosnia and Herzegovina |
| JEL: | G21 G11 O16 P20 |
| Date: | 2007–12–01 |
| URL: | http://d.repec.org/n?u=RePEc:wdi:papers:2008-915&r=tra |
| By: | Irene Andreou; Gilles Dufrenot; Alain Sand-Zantman; Aleksandra Zdzienicka-Durand |
| Abstract: | We propose a measure of the probability of crises associated with an aggregate indicator, where the percentage of false alarms and the proportion of missed signals can be combined to give an appreciation of the vulnerability of an economy. In this perspective, the important issue is not only to determine whether a system produces true predictions of a crisis, but also whether there are forewarning signs of a forthcoming crisis prior to its actual occurrence. To this end, we adopt the approach initiated by Kaminsky, Lizondo and Reinhart (1998), analyzing each indicator and calculating each threshold separately. We depart from this approach in that each country is also analyzed separately, permitting the creation of a more “custom-made” early warning system for each one. |
| Keywords: | Currency Crisis, Early Warning System, Composite Indicator, Eastern Europe. |
| JEL: | F31 F47 |
| Date: | 2007–05–01 |
| URL: | http://d.repec.org/n?u=RePEc:wdi:papers:2008-901&r=tra |
| By: | Guglielmo Maria CAPORALE,; Christophe Rault; Robert SOVA; Ana Maria SOVA |
| Abstract: | The expansion of regionalism has spawned an extensive theoretical literature analyzing the effects of Free Trade Agreements (FTAs) on trade flows. In this paper we focus on FTAs (also called European agreements) between the European Union (EU-15) and the Central and Eastern European countries (CEEC-4, i.e. Bulgaria, Hungary, Poland and Romania) and model their effects on trade flows by treating the agreement variable as endogenous. Our theoretical framework is the gravity model, and the econometric method used to isolate and eliminate the potential endogeneity bias of the agreement variable is the fixed effect vector decomposition (FEVD) technique. |
| Keywords: | Regionalisation, European integration, Panel data methods. |
| JEL: | E61 F13 F15 C25 |
| Date: | 2008–03–01 |
| URL: | http://d.repec.org/n?u=RePEc:wdi:papers:2008-912&r=tra |
| By: | Oxana Babetskaia-Kukharchuk |
| Abstract: | This paper aims at estimating the exchange rate pass-through (ERPT) for the Czech Republic. The existing empirical literature does not come to a consensus about the degree of pass-through to Czech inflation. Since there is no unique approach regarding how to measure ERPT, we use various specifications found in the pass-through literature for the Czech Republic. In addition, we estimate the pass-through along the distribution chain in the spirit of McCarthy (2007). We try to explore the properties of exchange rate shock transmission into Czech consumer prices by comparing impulse responses among 11 specifications estimated on data transformed in monthly differences and in annual rates. Equilibrium pass-through is estimated with the help of the VEC model. In addition, we try to account for possible variation in time. The simplest approach is a re-estimation of VAR models on two sub-periods. Our second strategy is the estimation of the error correction equation with the Kalman filter. Finally, we explore how the pass-through differs between tradable (3 sub-groups) and non-tradable goods. We find that the speed of exchange rate shock transmission to all prices is quite high. However, in absolute terms, ERPT does not exceed 25 – 30%. |
| Keywords: | Exchange rate pass-through, inflation, Kalman filter, VAR, VECM. |
| JEL: | E31 E52 E58 F31 |
| Date: | 2007–12 |
| URL: | http://d.repec.org/n?u=RePEc:cnb:wpaper:2007/12&r=tra |
| By: | Robert J. Sonora (Department of Economics, School of Business Administration, Fort Lewis College); Josip Tica (Faculty of Economics and Business, University of Zagreb) |
| Abstract: | In this paper we investigate purchasing power parity in the CEE and post-War former-Yugoslav states during EU integration process 1994-2006. This work stems from longer term tests of real exchange rate convergence in the former Yugoslavia. This period is of interest on two fronts: First, it investigates real exchange dynamics in the aftermath of war financed in part through seignorage; and second, we investigate the level of economic integration with the European Union following the break up of the former Yugoslavia. Given the short run nature of the available data we use panel unit root tests with and without structural breaks. Preliminary results suggest that real exchange rates between the former Yugoslav states and Germany are stationary when breaks are accounted for. Given the size of nominal shocks in the region, particularly in the early 1990s, preliminary results indicate that convergence to the long run equilibrium is relatively quick. |
| Keywords: | purchasing power parity, Economic Integration, panel unit root tests |
| JEL: | E31 F22 |
| Date: | 2008–06–05 |
| URL: | http://d.repec.org/n?u=RePEc:zag:wpaper:0804&r=tra |
| By: | Jan Filacek |
| Abstract: | The ex post analysis of inflation target fulfilment plays an important role in an inflation targeting framework. The major benefits of ex post analysis are threefold. First, it might improve the forecast accuracy. Second, it helps central bank staff and board members to understand the capabilities and limitations of the forecasts used in their decision-making. Third, it enhances monetary policy transparency and credibility. The primary aim of this paper is to propose a methodological framework for inflation target fulfilment assessment based on partial simulations, as applied in the Czech National Bank. In order to demonstrate the applicability of this framework we analyse the performance of the Czech National Bank between 2002 and 2006. We show that a large part of the inflation target misses in this period can be assigned to bias in the variables describing external developments. |
| Keywords: | Central bank, inflation target, monetary policy performance. |
| JEL: | E47 E58 |
| Date: | 2007–12 |
| URL: | http://d.repec.org/n?u=RePEc:cnb:wpaper:2007/11&r=tra |
| By: | Juan P. Chousa,; Artur Tamazian; Krishna Chaitanya Vadlamannati |
| Abstract: | The paper investigates whether the decline in environmental quality in BRIC economies is due to high energy consumption level which is a resultant of rapid economic growth. We answer this using environmental, macroeconomic and financial variables along with Kyoto Protocol indicators based on panel data from 1992 to 2004. |
| Keywords: | CO2 Emissions, Energy Consumption, Economic Growth, BRIC economies. |
| JEL: | Q40 Q41 Q43 O13 O14 |
| Date: | 2008–02–01 |
| URL: | http://d.repec.org/n?u=RePEc:wdi:papers:2008-908&r=tra |
| By: | Kamil Galuscak; Jan Pavel |
| Abstract: | We investigate to what extent high net replacement rates between non-work and work household income may distort work incentives. Using a microsimulation model, we find that net replacement rates are particularly high for households with a working partner and children. While net replacement rates decreased moderately between 1996 and 2006 as wages rose faster than social benefits, the incidence of unemployment traps remains high. In particular, about a third of all employed individuals have a low incentive to avoid short spells of unemployment with the unemployment benefits provided, while unemployment traps are also widespread among the unemployed. The incidence of unemployment traps increased further in 2007 despite a reform of benefits. In particular, housing benefit, which was overhauled to reflect housing costs, increases net replacement rates, distorting work incentives particularly among households with children. In addition, the rise in parental allowance may lock eligible individuals in non-employment, increasing the loss of human capital among non-working parents. This is particularly important for single parents, who face the highest specific unemployment rate, and also long unemployment spells among all household types. While the link between net replacement rates and labour market stocks and flows is not straightforward across household types, further research should focus on the labour market behaviour of particular household types. |
| Keywords: | Labour supply, microsimulation models, net replacement rate, survey data, tax-benefit reform, unemployment trap. |
| JEL: | C15 H31 H53 J22 |
| Date: | 2007–12 |
| URL: | http://d.repec.org/n?u=RePEc:cnb:wpaper:2007/9&r=tra |