nep-tra New Economics Papers
on Transition Economics
Issue of 2010‒11‒13
forty-six papers chosen by
J. David Brown
Heriot-Watt University

  1. Financial Integration, Monetary Policy and Stock Prices: Empirical Evidence for the New EU Member States By Pirovano M.
  2. Factors affecting farm productivity in Bulgaria, Hungary, Poland, Romania and Slovenia after the EU-accession and likely structural impacts By Campos, Monica; JakliÄ, Tina; JuvanÄiÄ, Luka
  3. Non-farm income diversification of rural farm households in Central and Southeastern Europe: an application of fuzzy set theory By Fritzsch, Jana; Buchenrieder, Gertrud; Möllers, Judith
  4. Monetary policy, asset prices and consumption in China By Koivu, Tuuli
  5. SES Health Gradients during the Epidemiological Transition: The Case of China By Xiaoyan Lei; Nina Yin; Yaohui Zhao
  6. Explaining Rising Returns to Education in Urban China in the 1990s By Xuejun Liu; Albert Park; Yaohui Zhao
  7. Labour Market Impact of Large Scale Internal Migration on Chinese Urban 'Native' Workers By Meng, Xin; Zhang, Dandan
  8. Agglomeration Economies in Ukrainian Dairy Sector: a Marked Point Process Approach By Brummer, Bernhard; Von Cramon-Taubadel, Stephan; Nivievskyi, Oleg; Schlather, Martin
  9. What Does the Lewis Turning Point Mean for China? A Computable General Equilibrium Analysis By Huang Yiping; Jiang Tingsong
  10. Mapping Serbia: more targeted rural areas for better policies By Monasterolo, Irene; Coppola, Nicola
  11. Inequality, Growth and Public Spending in Central, East and Southeast Europe By Mario Holzner
  12. Dissecting the China Puzzle: Asymmetric Liberalization and Cost Distortion By Huang Yiping
  13. Paying a Visit: The Dalai Lama Effect on International Trade By Andreas Fuchs; Nils-Hendrik Klann
  14. Pension funds' performance in strongly regulated industries in Central Europe: Evidence from Poland and Hungary By Bohl, Martin; Lischewski, Judith; Voronkova, Svitlana
  15. Land grabbing in Eastern Europe: global food security and land governance in post - Soviet Eurasia By Visser, Oane; Spoor, Max
  16. From centrally planned development to human development By Andrey Ivanov; Mihail Peleah
  17. Innovation strategy, firm survival and relocation: The case of Hong Kong-owned manufacturing in Guangdong province, China By Sharif, Naubahar; Huang, Can
  18. Distributional Impacts of Food Price Changes on Consumer Welfare in Hungary and Romania following EU Accession By Hubbard, Carmen; Szigeti, Judith; Podruzsik, Szilard
  19. Causes and Remedies of China’s External Imbalances By Huang Yiping; Tao Kunyu
  20. The Impact of innovation activities on firm performance using a multi-stage model: evidence from the Community Innovation Survey 4 By Iraj Hashi; Nebojsa Stojcic
  21. Rural livelihoods in the EU new member states: subsistence production versus market integration By Fredriksson, Lena; Davidova, Sophia; Bailey, Alastair
  22. From small farming to rural, non-agricultural work in Romania: an evaluation on 3 measures of the rural development programme By Ghib, Marie Luce; Berriet-Solliec, Marielle
  23. Social Models in the Enlarged EU By David G. Mayes; Zaidah Mustaffa
  24. Unions Improve Chinese Workers' Welfare - Results from 1,268 Firms By Yang Yao; Ninghua Zhong
  25. Bulgarian rural development policy implementation and new rural paradigm By Peneva, Mariya Marinova; Kopeva, Diana Ilieva
  26. Changes in rural areas of Ukraine: problems and opportunities By Moroz, Serhiy Mykolayovych
  27. Post-global financial crisis: The measure of the “Beijing consensus” as a variety of capitalisms By Killion, M. Ulric
  28. Bank capital, liquidity creation and deposit insurance By Fungácová, Zuzana; Weill, Laurent; Zhou, Mingming
  29. âCurrent challenges of Albanian extension services in the context of EU integration and global marketsâ By Viaggi, Davide; Imami, Drinimi; Zhllima, Edvin; Leonetti, Luciano
  30. Size, value and liquidity: Do they really matter on an emerging stock market? By Lischewski, Judith; Voronkova, Svitlana
  31. Export Differentiation in Transition Economies By Besedes, Tibor
  32. The dimensions of social capital and rural development: evidence from Water Communities in the Republic of Macedonia By Gorton, Matthew; Sauer, Johannes; Peshevski, Mile; Bosev, Dane; Shekerinov, Darko; Quarrie, Steve
  33. The role of semi-subsistence farms and corporate farms in the modern supply chain: evidence of Ukrainian dairy industry By Mykhaylenko, Maryna; Schaft, Franziska
  34. Networks as determinants of rural migration By Zarnekow, Nana; Henning, Christian H.C.A
  35. Transversal reorganization analysis of small and midsized enterprises of Romania By Căpuşneanu, Sorinel/I; Barbu, Cristian Marian
  36. Evaluating the implementation process of LEADER in Romania By Marquardt, Doris; Moellers, Judith
  37. Systemic Weather Risk and Crop Insurance: The Case of China By Wei Xu; Ostap Okhrin; Martin Odening; Ji Cao
  38. The impact of non-farm income on the investment in agriculture: evidence from Hungary and Slovenia By Bojnec, Štefan; Bakucs, Lajos Zoltán; Ferto, Imre; Latruffe, Laure
  39. The Exaggerate Socialism Of Raul’s Cuba By Gabriele, Alberto
  40. Mean-Variance & Mean-VaR Portfolio Selection: A Simulation Based Comparison in the Czech Crisis Environment By Radovan Parrák; Jakub Seidler
  41. Towards a shift from agricultural to rural development policy. The case of the Republic of Macedonia By Todorov, Kiril; Vittuari, Matteo
  42. Processing Trade, Firms Productivity, and Tariff Reductions: Evidence from Chinese Products By Miaojie Yu
  43. Structural changes and labour adjustments in rural Bulgaria By Mishev, Plamen Dimitrov; Ivanova, Nedka Momcheva; Harizanova, Hristina Stefanova
  44. Determinants of smallholdersâ decisions to leave land fallow: the case of Kosovo By Sauer, Johannes; Davidova, Sophia; Latruffe, Laure
  45. Multifunctional land use: is it a key factor for rural development? By Kopeva, Diana Ilieva; Peneva, Mariya Marinova; Madjarova, Svetla Ivanova
  46. Georgian Research and Development System in 1996-2005 By Gogodze, Joseph; Uridia, Merab

  1. By: Pirovano M.
    Abstract: We provide empirical evidence on the interaction between monetary policy and stock prices in 4 new EU member states of Central and Eastern Europe by estimating a small open economy macroeconometric model (SVAR) identi?ed by means of short-run restrictions. Our modeling choices refl?ect the increasing integration between the NMS and the Euro Area. Our contributions are twofold. We analyze the monetary transmission mechanism through stock prices in the NMS and we determine the extent to which fi?nancial markets in the aforementioned countries are sensitive to euro area monetary policy actions. We conclude that stock prices in the NMS are more sensitive to changes in the Euro Area interest rate than to the domestic one. Only in the Czech Republic and Poland we fi?nd a signi?cant negative effect of contractionary monetary policy on stock prices. Moreover, we fi?nd that the volatility of stock prices in the NMS is mainly due to shocks related to exchange rate and Euro Area monetary policy shocks.
    Date: 2010–10
  2. By: Campos, Monica; JakliÄ, Tina; JuvanÄiÄ, Luka
    Abstract: The paper is investigating the recent evolution of farm productivity in five EU New Member States (NMS): Bulgaria, Hungary, Romania, Poland and Slovenia. More precisely, the paper deals with determinants influencing farm productivity in a changing market and policy environment brought by their full integration to the CAP. With a combination of multivariate statistics and econometric techniques, it attempts to identify and explain the patterns of agricultural labour productivity change in the period 2003-2005. Results suggest that adjustment patterns are diverging and are region-specific, depending mainly on the initial farm structural conditions, and availability of non-farm jobs. Policy implications of the paper suggest that agricultural policy should move away from the concept of transfers to agriculture to more pro-active role in creating conditions for job creation in rural areas.
    Keywords: structural adjustment, farm productivity, farming types, EU-accession, Community/Rural/Urban Development, Q12, R11,
    Date: 2010–08
  3. By: Fritzsch, Jana; Buchenrieder, Gertrud; Möllers, Judith
    Abstract: A fuzzy logic model for quantifying farm householdsâ potential for non-farm income diversification is developed and applied to 1,077 farm households in Bulgaria, Hungary, Poland, Romania, and Slovenia. About three quarters of households have a diversification potential, but not all households use it. An analysis of diversification potential and diversification behaviour shows that there are seven household types in the sample. Not all development options, i.e. farm development, farm exit, or starting non-farm employment, are equally suitable for all households thus fine targeting of policy measures according to the household type could be important for policy makers.
    Keywords: rural development, non-farm rural employment diversification, fuzzy logic, transition countries, Community/Rural/Urban Development, C65, D33, J24, Q12,
    Date: 2010–08
  4. By: Koivu, Tuuli (BOFIT)
    Abstract: This paper studies the wealth channel in China. Using the structural vector autoregression method, we find that a loosening of China’s monetary policy indeed leads to higher asset prices, which in turn are linked to household consumption. However, the importance of the wealth channel as a part of the monetary policy transmission mechanism in China is still limited.
    Keywords: China; monetary policy; asset prices
    JEL: E52 P24
    Date: 2010–11–05
  5. By: Xiaoyan Lei; Nina Yin; Yaohui Zhao (China Center for Economic Research)
    Abstract: The epidemiological transition, which has already passed the developed world, is still progressing in many developing countries. A particular problem associated with this transition is the under-diagnosis and lack of treatment of chronic diseases, and these may exhibit SES gradients and exacerbate social inequality. Using hypertension as an example and data from China (CHNS), we find that the prevalence of hypertension in China is already close to levels in developed countries, under-diagnosis is pervasive, treatment is rare, and failure to control is widespread. Consistent with the literature, we find no income and education gradients in the prevalence of hypertension. However, there are strong education gradients in diagnosis and treatment in urban areas. The income gradients in all aspects of hypertension are relatively weak and sometimes nonexistent. Interestingly, we find that access to health care does not contribute to the diagnosis of hypertension, nor does it aid much in the treatment and control of hypertension. Our results suggest that the epidemiological transition has indeed occurred, but both the Chinese public and its health care system are ill-prepared. There is an urgent need to educate the public on chronic illnesses, and to raise the quality of health care so that patients receive proper diagnoses and guidance on how to treat and control those chronic illnesses.
    Keywords: Epidemiological transition, Under-diagnosis, SES health gradients
    JEL: I10
    Date: 2010
  6. By: Xuejun Liu; Albert Park; Yaohui Zhao (China Center for Economic Research)
    Abstract: Although theory predicts that international trade will decrease the relative demand for skilled workers in relatively skill-deficit countries, in recent decades many developing countries have experienced rising wage premiums for skilled workers. We examines this puzzle by quantifying the relative importance of different supply and demand factors in explaining the rapid increase in the returns to education experienced by China during the 1990s. Analyzing Chinese urban household survey and census data for six provinces, we find that although changes in the structure of demand did reduce the demand for skilled workers, consistent with trade theory, the magnitude of the effect was modest and more than offset by institutional reforms and technological changes that increased the relative demand for skill.
    Keywords: international trade, education, China, urban household survey
    JEL: I20
    Date: 2010
  7. By: Meng, Xin (Australian National University); Zhang, Dandan (Australian National University)
    Abstract: Hundreds of millions of rural migrants have moved into Chinese cities since the early 1990s contributing greatly to economic growth, yet, they are often blamed for reducing urban 'native' workers’ employment opportunities, suppressing their wages and increasing pressure on infrastructure and other public facilities. This paper examines the causal relationship between rural-urban migration and urban native workers' labour market outcomes in Chinese cities. After controlling for the endogeneity problem our results show that rural migrants in urban China have modest positive or zero effects on the average employment and insignificant impact on earnings of urban workers. When examine the impact on unskilled labours we once again find it to be positive and insignificant. We conjecture that the reason for the lack of adverse effects is due partially to the labour market segregation between the migrants and urban natives, and partially due to the complementarities between the two groups of workers. Further investigation reveals that the increase in migrant inflow is related to the demand expansion and that if the economic growth continues, elimination of labour market segregation may not necessarily lead to an adverse impact of migration on urban native labour market outcomes.
    Keywords: migration, native labour market outcomes, China
    JEL: J80 J45
    Date: 2010–10
  8. By: Brummer, Bernhard; Von Cramon-Taubadel, Stephan; Nivievskyi, Oleg; Schlather, Martin
    Abstract: Even after more than 15 years of transition from plan to market, agriculture in Ukraine still faces many challenges in terms of its structure. The evidence in the literature points to significant heterogeneity of technical efficiency and productivity scores in Ukraine. Moreover, both the recently approved WTO accession, and the ongoing negotiations on a free trade agreement with the EU will require further improvements in productivity and competitiveness at the farm level. Using farm-level data for 2004-2005, we study the presence and possible causes of agglomeration economies in Ukrainian dairy sector. One of the most important results is that there are agglomeration effects in the sector. The performance of dairy farms is influenced by the performance of its neighbors. Furthermore, the dairy farms in the neighborhood of a dairy processor outperform the more distant ones, although the heterogeneity of this effect is substantial.
    Keywords: Ukraine, dairy farming, order-m frontier, spatial dependence, agglomeration., Agribusiness, Agricultural and Food Policy, Community/Rural/Urban Development, Food Consumption/Nutrition/Food Safety, Labor and Human Capital,
    Date: 2010–10–27
  9. By: Huang Yiping; Jiang Tingsong (China Center for Economic Research)
    Abstract: We apply a computable general equilibrium framework to assess likely impacts of the Lewis turning point on China and the rest of the world. Modeling results suggest that China will probably transition from an abnormal economy to a normal economy with somewhat lower growth but higher inflation, which requires significant revision to the macroeconomic policy framework. China would lose competitiveness in labor‐intensive activities, its current account surplus should fall but overinvestment risk could rise. These changes in China should help improve other counties’ current accounts and boost low‐cost countries’ production. The Lewis turning point, however, does not provide automatic solutions to some of the key challenges, such as service sector development and innovation capability. China will need to make serious policy efforts to avoid the so‐called ‘middle income trap’.
    Keywords: Lewis turning point, labor shortage, general equilibrium analysis, normal economy, middle‐income trap
    JEL: E30 C68
    Date: 2010
  10. By: Monasterolo, Irene; Coppola, Nicola
    Abstract: The analysis of the experiences of Central and Eastern European Countries (CEEs) in transition, which became EU members in the historical 2004 (and 2007) enlargement, evidences the importance of timing and targeting policy intervention for a balanced growth (Monasterolo et. al, 2008). In fact, even if the Countries, till the last financial and economic crisis, showed a clear path of convergence (EC, 2008; EC, 2009) with EU average levels of development thanks to a sustained growth in GDP, at the same time they had to face a notable increase in regional inequality (Brasili, 2005), mainly driven by the persisting backwardness of agricultural and rural areas. The European pre-accession funds had limited effect in preventing the spread in internal divergence because of the lack of ex ante and in itinere monitoring and evaluation (Monasterolo, 2008). Moreover, they failed in addressing specific problems and needs of so variegated areas due to the deficiencies in identifying and defining the characteristics of rural areas (Csáki, 2009). This paper will introduce a new map of Serbia, a current EU pre-accession Country, where a clear identification of rural areas is still lacking (Bogdanov, 2007). We identified the dynamic characteristics of urban and rural areas as well as their strengths and weaknesses, computing a principal components analysis on a group of 37 socio-economic, agricultural and structural variables, which are available periodically at a municipality level. Then, we delineated homogeneous regions through the cluster analysis. This disaggregated mapping at the local level represents the fundamental starting point for developing integrated and diversified rural policies, enriched by a bottom up approach, following a neo-endogenous vision (Hubbard, 2009).
    Keywords: mapping rural areas, policy targeting, RD policy evaluation, EU enlargement, Community/Rural/Urban Development, O18, P25, R58,
    Date: 2010–08
  11. By: Mario Holzner (The Vienna Institute for International Economic Studies, wiiw)
    Abstract: The paper analyses the joint determinants of inequality and growth with a special emphasis on public spending structures in transition. The mutual benefit of low real interest rates, to both equity and economic development is a major result of this paper. In terms of public spending items we find a positive correlation with equity and a negative one with growth as several of the government expenditure items seem to act counter-cyclically. In the late 1990s and early 2000s the European integration process allowed most of the transition economies to aim for the best of both worlds: equity and economic development.
    Keywords: inequality, government expenditures, economic growth, transition
    JEL: D63 H5 O4 P2
    Date: 2010–10
  12. By: Huang Yiping (China Center for Economic Research)
    Abstract: In this paper we attempt to explain the China Puzzle: coexistence of accelerating economic growth and worsening growth outlook. The root cause lies in China’s unique liberalization approach, i.e., the combination of complete liberalization of product markets and continued distortions in factor markets. Repressed costs of labor, capital, land and resources artificially raise profits of production, increase returns to investment and improve international competitiveness of Chinese products. This is why economic growth is strong, but investment and exports are even stronger. These distortions also contribute to the global imbalances by boosting China’s current account surpluses and capital outflows in forms of foreign exchange reserves. We estimate factor cost distortions for 2000‐2009 to gauge the likely magnitudes and cross‐year patterns. They provide a reasonable explanation of the movement in economic imbalances. These findings have important policy implications. The government’s efforts to rebalance the economy after 2003 failed because it did not attack the root cause, i.e, the incentive structure. Popular calls for renminbi appreciation might work ineffectively as currency undervaluation is only part of the distortion. The best policy for achieving sustainable growth would be a comprehensive package focusing on liberalization of the factor markets and elimination of cost distortions.
    Keywords: China puzzle, asymmetric market liberalization, cost distortion, imbalances
    JEL: F30 F40
    Date: 2010
  13. By: Andreas Fuchs; Nils-Hendrik Klann
    Abstract: The Chinese government frequently threatens that meetings between its trading partners’ officials and the Dalai Lama will be met with animosity and ultimately harm trade ties with China. We run a gravity model of exports to China from 159 partner countries between 1991 and 2008 to test to which extent bilateral tensions affect trade with autocratic China. In order to account for the potential endogeneity of meetings with the Dalai Lama, the number of Tibet Support Groups and the travel pattern of the Tibetan leader are used as instruments. Our empirical results support the idea that countries officially receiving the Dalai Lama at the highest political level are punished through a reduction of their exports to China. However, this ‘Dalai Lama Effect’ is only observed for the Hu Jintao era and not for earlier periods. Furthermore, we find that this effect is mainly driven by reduced exports of machinery and transport equipment and that it disappears two years after a meeting took place.
    Keywords: International Trade, International Political Economy, Diplomatic Relations, Exports to China, Tibet, Dalai Lama
    JEL: F13 F51 F59
    Date: 2010–10–19
  14. By: Bohl, Martin; Lischewski, Judith; Voronkova, Svitlana
    Abstract: This paper presents an analysis of pension funds' performance in Poland and Hungary, two Central European countries characterized by strong regulation of their private pension fund industries. Thus, the paper extends the literature which has so far mostly focused on performance of pension fund industries facing no or limited regulation. We find that the performance of pension funds in the two studied countries differs. While we do not find convincing evidence of outperformance by Polish pension funds, we find strong evidence of underperformance by Hungarian pension funds. The results are robust to time-variation. The paper considers possible explanations behind these findings. The results of the paper should be of interest for policy-makers seeking to achieve optimal performance of the pension systems and academics in the research area of pension funds. --
    Keywords: pension fund management,investment and performance regulation,performance measurement,Central European stock markets,Emerging Markets
    JEL: G23 G28
    Date: 2010
  15. By: Visser, Oane; Spoor, Max
    Abstract: While âland grabbingâ in Africa by China, and other populous, high-income Asian countries such as South Korea got quite some attention, land grabbing in post-Soviet Eurasia has gone largely unnoticed. However, as this paper shows, recently also in the latter region foreign state and private companies are accumulating vast expanses of farm land. The paper discusses the factors which make post-Soviet Eurasia such an attractive area for international investment, with arguably much more potential than most areas in Africa or Asia. Second, the process of land accumulation and acquisition of farms is described. Both domestic as well as international accumulation of land is dealt with, placing this in the domestic context of agricultural development and institutions. Furthermore, the main actors (investors) involved in land grabbing are distinguished (according to their country of origin and legal or institutional form). Third, the paper outlines the main obstacles (and points of contention) concerning the emergence (and effectiveness/performance) of domestic and especially international, agro-holdings in the region, and will present some preliminary findings around the question whether this development is a necessary step towards agricultural modernization, or that there are substantial disadvantages to land grabbing.
    Keywords: land grabbing, post-Soviet countries, agroholdings, economic inequality, Community/Rural/Urban Development,
    Date: 2010–08
  16. By: Andrey Ivanov (UNDP Bratislava Regional Centre); Mihail Peleah (UNDP Bratislava Regional Centre)
    Abstract: This paper examines the links between human development concept and the attempt to implement the communist project in the countries of the former socialist bloc. It argues that the human development performance of the socialist system, despite its beneficial outcome for the ‘working masses’, had little in common with actual human development. It met basic needs in education, health, and living standards. Under the socialist system development approaches were missing two major components of human development – freedom and agency. In this sense an emerging sense of agency in societies in the region is the major transformation outcome. The departure from centrally planned and state-dominated model of development was painful, expensive and took long time. In some countries it is still in process with uneven progress and moments of reverse. But the overall trend is clear and policies that encourage people someone to take responsibility, act and bring about change for improving their own welfare are the best long-term investment in human development opportunities. Still, major questions remain unanswered. The first is to what extent the current – market-based, consumer demand oriented – system is capable of going beyond those basic needs and combine economic growth with other human development dimensions? Has it already gone into the opposite extreme to that of the former communist utopia attempt – subordinating human development to consumer demand driven consumption? Answering these questions goes beyond the scope of the current paper but the socialist countries’ experience could perhaps provide some insights for the answers.
    Keywords: human development, basic needs, Europe, Central Europe, Eastern Europe, Central Asia, USSR, CIS, transitional economies, freedom, agency.
    JEL: P36 N30 O15 O52 P20
    Date: 2010–10
  17. By: Sharif, Naubahar (Division of Social Science, The Hong Kong University of Science and Technology); Huang, Can (UNU-MERIT, Maastricht University)
    Abstract: Based on a survey adapted from the Fourth European Community Innovation Survey (CIS-4), this study finds that, in the changing manufacturing environment of Guangdong province in China, Hong Kong-owned businesses that generate a higher share in new product sales as a percentage of total sales or engage in R&D or collaborative innovation activities in China are more likely to survive and remain in Guangdong. The study fills a gap in the literature by investigating the effects of innovation on the survival and relocation of Hong Kong-owned manufacturing firms in Guangdong. The results support policy initiatives that strengthen collaborative ties among key innovation system actors.
    Keywords: Innovation, Survival, Relocation, Community Innovation Survey, Asia, China
    JEL: D21 L25 L52 O31 R11
    Date: 2010
  18. By: Hubbard, Carmen; Szigeti, Judith; Podruzsik, Szilard
    Abstract: This paper focuses on the estimation of changes in economic welfare (real income) on different groups (income deciles) of Hungarian and Romanian consumers following food price changes as a result of accession to the European Union (EU) in 2004 and 2007. It identifies in both countries those consumer groups most vulnerable to food price changes using the most recent, official, post accession data. Slutsky Compensating Variation, based on Laspeyres indexes is employed for a food basket of 16 products. The results show that real food prices have changed with some going up and others falling. However, overall both Hungary and Romania have experienced a rise in real food prices by 9 per cent and 20 per cent, respectively. The rise in food prices has resulted in a welfare loss for all income deciles, particularly for those in the lower income groups. Although, in absolute terms, Romanian food consumers seem to be more affected (the decrease in their real income varies between 4 per cent for decile 10 and 12 per cent for decile 1) than Hungarian consumers (0.4 per cent for decile 10 and 2.2 per cent for decile 1), the distribution of the impact is higher in Hungary, a five-fold difference between decile 1 and decile 10 as opposed to a three-fold difference in Romania.This paper focuses on the estimation of changes in economic welfare (real income) on different groups (income deciles) of Hungarian and Romanian consumers following food price changes as a result of accession to the European Union (EU) in 2004 and 2007. It identifies in both countries those consumer groups most vulnerable to food price changes using the most recent, official, post accession data. Slutsky Compensating Variation, based on Laspeyres indexes is employed for a food basket of 16 products. The results show that real food prices have changed with some going up and others falling. However, overall both Hungary and Romania have experienced a rise in real food prices by 9 per cent and 20 per cent, respectively. The rise in food prices has resulted in a welfare loss for all income deciles, particularly for those in the lower income groups. Although, in absolute terms, Romanian food consumers seem to be more affected (the decrease in their real income varies between 4 per cent for decile 10 and 12 per cent for decile 1) than Hungarian consumers (0.4 per cent for decile 10 and 2.2 per cent for decile 1), the distribution of the impact is higher in Hungary, a five-fold difference between decile 1 and decile 10 as opposed to a three-fold difference in Romania.
    Keywords: prices, consumers, welfare, Agribusiness, Agricultural and Food Policy, Community/Rural/Urban Development, Food Consumption/Nutrition/Food Safety, Labor and Human Capital,
    Date: 2010–10–27
  19. By: Huang Yiping; Tao Kunyu (China Center for Economic Research)
    Abstract: China’s large current account surpluses not only destabilize its macroeconomic conditions but also are also at the center of global rebalancing. The literature offered five explanations for such surpluses, most of which are important but fail to account for the recent surge and/or offer actionable policy responses. In this study, we propose an alternative hypothesis for China’s large current account surpluses: asymmetric market liberalization and associated cost distortions. This unique reform approach was the fundamental cause of both extraordinary growth performance and growing structural imbalances during the reform period. Indeed, estimates of cost distortions provide good fits of the current account. Estimated cost distortions rose after 2004 but peaked in 2006 at 12.2 percent of GDP. The worst of the external imbalance problem may be already behind us. We argue that, for rebalancing its economy, China needs a comprehensive package focusing on further liberalization of factor markets. Exchange rate policy should be an important part, but exclusive focus on the currency could be counter‐productive.
    Keywords: China, current account surplus, imbalance, exchange rate, asymmetric market liberalization, cost distortion
    JEL: F40
    Date: 2010
  20. By: Iraj Hashi; Nebojsa Stojcic
    Abstract: The impact of innovation on firm performance has been a matter of significant interest to economists and policy makers for decades. Although innovation is generally regarded as a means of improving the competitiveness of firms and their performance on domestic and foreign markets, this relationship has not been supported unambiguously by empirical work. Innovative activities of firms influence their performance not necessarily directly but through the production of useful innovations and increased productivity. Therefore, in recent years, the relationship between innovation and firm performance has been modelled by a multistage approach. However, the findings from existing studies differ in many respects which suggests that there is the need for further research. In this paper we employ firm level data from the fourth Community Innovation Survey (CIS4), covering some 90,000 firms in 16 West and East European countries in order to assess the drivers of the innovation process in two different institutional settings, a number of mature market economies of Western Europe and a number of advanced transition economies from Central and Eastern Europe. A four-equation model, originating in the work of Crepon et al., (1998), has been used to link the innovation decision of firms to their performance through the impact of innovation input on innovation output and the innovation output on productivity and better performance. Our findings confirm the positive relationship between innovation activities and productivity at the firm level and provide further evidence on the relationship between size and innovation activities.
    Keywords: innovation, firm performance, multi-stage model, Community Innovation Survey 4
    JEL: O31 L25
    Date: 2010
  21. By: Fredriksson, Lena; Davidova, Sophia; Bailey, Alastair
    Abstract: Commercialisation of small farmers, of which many are subsistence farmers producing mainly for own consumption needs, is an important policy objective for the restructuring process of the farm structure in the EU New Member States (NMS). Drawing on primary survey data from five EU NMS, this paper first assesses the importance of subsistence farming in the NMS through the valuation of subsistence production at market prices. Secondly, the paper analyses the differences between subsistence and commercial households. Where previous studies normally classify households as subsistence or commercial based on a pre-defined threshold, the use of latent class regression in this paper represents a way to systematically analyse heterogeneous groups of households in a more objective way, as determinant of class membership (subsistence or commercial) is not pre-defined. The latent class regression provides evidence of two classes â one subsistence and one commercially oriented â who differ in behaviour with respect to a set of explanatory variables accounting for attitudes, production and household characteristics.
    Keywords: Agricultural households, subsistence, commercialisation, market integration, latent class regression, Community/Rural/Urban Development, Q12, Q18,
    Date: 2010–08
  22. By: Ghib, Marie Luce; Berriet-Solliec, Marielle
    Abstract: Romanian rural areas contain the highest level of agricultural workers in the European Union, resulting in the challenge of stimulating non-agricultural employment. This paper uses the methodology of policy evaluation to analyse the influence of 3 measures the CAP. From an objectives tree to reveal the objectives of the programme to statistical analysis and field surveys, we analysed the pertinence, the coherence and the first results of those schemes. It was found that the targeted population was under estimated for one of the semi-subsistence schemes. Choosing activities (tourism and enterprise) which are open to all rural society leads to enhanced competition between beneficiaries. Due to the global context of economic crisis, co-financing can be met only by owners of strong capital, and the previous targeted population would then be only indirectly touched by the creation of jobs in rural areas.
    Keywords: rural policies, policy evaluation, small farms, Romania, Community/Rural/Urban Development, R58, O21, H72, C13,
    Date: 2010–08
  23. By: David G. Mayes; Zaidah Mustaffa
    Abstract: This paper considers the impact of the developments of the last 20 years on the nature of social models in the EU as categorized by the traditional Anglo-Saxon, Continental, Nordic and Southern regimes. It looks in particular at the impact of enlargement, globalisation and the pressures within the EU for harmonisation. In order to consider whether the addition of the new member states constitutes a further separate model it looks at the case of healthcare in Poland, the Czech Republic and Estonia. The conclusion is that neat categorisation is becoming increasingly difficult as countries adopt characteristics of other regimes and develop different parts of the social welfare system in different ways. While there is some element of increasing similarity, distinct regimes continue and it would not be realistic to talk about a single European social model in further research on the implications for democracy in the framework of the RECON project.
    Keywords: Czech Republic; Estonia; health policy; Poland; social policy; welfare state
    Date: 2010–10–15
  24. By: Yang Yao; Ninghua Zhong (China Center for Economic Research)
    Abstract: Based on a survey of 1,268 firms in 12 Chinese cities, this paper empirically studies the effects of unions on three aspects of workers’ welfare, namely, hourly wages, monthly working hours, and pension coverage. Our baseline results show that unionization increases hourly wage rates by 5.6%, reduces monthly working hours by 1.4%, and raises pension coverage by 12.3%. Taking the endogeneity of unionization into consideration, our 3SLS estimation finds larger effects. These results are robust in the subsample of domestic private enterprises where unions are less common than in other types of firms. Further econometric analysis has established two channels for unions to improve workers’ welfare, one by encouraging collective wage contracts, and the other by encouraging written contracts.
    Keywords: Unionization, workers’ welfare, Chinese firms
    JEL: J3 J51
    Date: 2010
  25. By: Peneva, Mariya Marinova; Kopeva, Diana Ilieva
    Abstract: The role of Rural Development Policy is growing nowadays. As an EU member state Bulgaria started implementation of Rural Development Policy. The paper analyse the level of achievement of the Rural Development Programmeâs objectives in Bulgaria. The programme started in 2008 and most of the measures are implemented. But effective payments have been done only under eight measures. The vast majority of financed projects are for investments mainly in agriculture (for perennial crops production, buildings, machineries and equipment). In the paper are specified opportunities and challenges of the rural development policy in Bulgaria in order to be consistent with the new rural paradigm.
    Keywords: Rural development, New rural paradigm, Rural development policy, Bulgaria, Community/Rural/Urban Development, Q10, Q18, R58,
    Date: 2010–08
  26. By: Moroz, Serhiy Mykolayovych
    Abstract: The paper describes the main tendencies and perspectives of development of rural areas in Ukraine. It emphasizes that the key reason of existing socio-economic issues in rural regions is the absence of well-defined rural development policy. Thus, it is necessary for Ukraine to implement long-term rural policy, as it takes place in countries of the European Union. Rural development should be based on the territorial approach. The special attention should be paid to the creation of local action groups. Hence, it is essential to introduce a program, similar to the LEADER initiative, to use local possibilities, and to implement the bottom-up approach for the solution of rural issues. Also, special strategies should be developed to expand non-farm rural activities. The above-mentioned measures will give good opportunities to improve the socio-economic situation in rural areas, to increase the standard of living of rural people, and to enhance the competitiveness of the rural economy.
    Keywords: Rural development, rural policy, Ukraine, Community/Rural/Urban Development, R11, R58,
    Date: 2010–08
  27. By: Killion, M. Ulric
    Abstract: In order to explore the prospective effects of what hails as the Beijing consensus, a conceptualization arguably near-synonymous with Beijing’s export-oriented strategy, the Article first discusses the state of the Chinese economy in the post-global financial crisis era. After reviewing some key indicators of the country’s economy, the Article presents a comparison between a Washington and Beijing consensus, contrasting ideological meanings between these two consensuses, and then explores the measure of the Beijing consensus as a variety of capitalisms. By doing so the Article reveals the broader role of Beijing’s export-oriented strategy and its eventual relation to international capital’s industrial transformation and the prospective effects of a Beijing consensus. The Article concludes by presenting a prospectus of the Beijing consensus as a variety of capitalisms in the post-global financial crisis era. By presenting the Beijing consensus or even export-oriented strategy as an evolving model in this new era, China’s trade and finance models prospectively present a distinctive modeling of capitalism and its tools of trade and finance models.
    Keywords: China; economy; export; capitalist; socialist; transformation
    JEL: F00 P00 F10 Z00
    Date: 2010–10–28
  28. By: Fungácová, Zuzana (BOFIT); Weill, Laurent (BOFIT); Zhou, Mingming (BOFIT)
    Abstract: This paper examines how the introduction of deposit insurance influences the relationship between bank capital and liquidity creation. As discussed by Berger and Bouwman (2009), there are two competing hypotheses on this relationship which can be influenced by the presence of deposit insurance. The introduction of a deposit insurance scheme in an emerging market, Russia, provides a natural experiment to investigate this issue. We study three alternative measures of bank liquidity creation and perform estimations on a large set of Russian banks. Our findings suggest that the introduction of the deposit insurance scheme exerts a limited impact on the relationship between bank capital and liquidity creation and does not change the negative sign of the relationship. The implication is that better capitalized banks tend to create less liquidity, which supports the “financial fragility/crowding-out” hypothesis. This conclusion has important policy implications for emerging countries as it suggests that bank capital requirements implemented to support financial stability may harm liquidity creation.
    Keywords: bank capital; liquidity creation; deposit insurance; Russia
    JEL: G21 G28 G38 P30 P50
    Date: 2010–11–05
  29. By: Viaggi, Davide; Imami, Drinimi; Zhllima, Edvin; Leonetti, Luciano
    Abstract: Albania is a transition country aspiring to become a member of EU, while it is expected that it will become Candidate member within 2012, enabling access to IPARD funding. EU integration implies more opportunities, in form of subsidies for rural and agriculture development, but also imposes standards related to quality and safety on one hand, and enhancement of efficiency on the other hand. More specifically, in order to be eligible for the coming IPARD funding, Albanian agriculture holdings and agro-processors, need to meet national and EU safety standards (see [1], [2] and [3]). In this upgrading process, the role that extension services can and should play is crucial. The Albanian agriculture extension services have undergone a drastic change from the time of the state-organized economy to the market economy, as also the private extension services have emerged. In this study, we look into current situation and future perspectives for extension agriculture services in fruits, vegetables and livestock subsectors, in order to identify: a) the present behaviour related to the use and provision of extension services; b) the (perceived) needs for technical assistance and Capacity Building (CB) from the perspective of service providers and clients (agriculture holdings and agro-processors) with regards to services related to quality and safety standards, certification etc. Despite improvements in some private and public services, such as cattle insemination and vaccinations, other services are poorly served, such as services related to quality/safety standards certification [9]. Further research on extension services in Albania is needed as availability of quality extension services is a key factor to achieve agriculture competitiveness in Albania. This is particularly important in the context of EU integration and in the light of multiple relationships developing with the globalised economy in terms of: a) support to extension services through donor activities; b) chain interplay between local and foreign agriculture and agri-food industry; c) growing competition even in the domestic market.
    Keywords: Extension service, Albania., Agribusiness, Agricultural and Food Policy, Community/Rural/Urban Development, Food Consumption/Nutrition/Food Safety, Labor and Human Capital,
    Date: 2010–10–27
  30. By: Lischewski, Judith; Voronkova, Svitlana
    Abstract: The paper extends the evidence on the factors relevant for pricing stocks in emerging markets. While previous literature focused on Latin American and Asian developing markets, Central and Eastern European markets remain under-researched. By focusing on the Polish stock market, we aim to fill in a gap in the asset pricing literature and draw attention to these previously overlooked markets. In addition to analyzing the importance of the most prominent risk-factors such as market, size and book-to-market value, we investigate whether liquidity plays a role in pricing Polish stocks. To test this conjecture we use the largest array of liquidity measures that has been used in the literature to date. We take advantage of a hand-collected dataset covering the longest period studied so far in case of the this market. Our results support existing evidence for developed markets with regard to the market, size, and book-to-market factor. However, in contrast to studies on other emerging markets, we do not find convincing evidence in favour of the liquidity risk premium on the Polish stock market. This result is robust across various liquidity measures and time periods. Analyzing specific characteristics of the Polish market, we consider possible explanations behind this finding. --
    JEL: G10 G12
    Date: 2010
  31. By: Besedes, Tibor
    Abstract: I investigate changes in the structure of trade of seventeen transition economies between 1996 and 2006, focusing on differences across three types of products -- homogeneous goods, reference priced goods, and differentiated products. I examine shares of exports of each type of good, intensive and extensive margins, and the hazard of exporting. While there are cross-country differences in the distribution of export shares and in intensive and extensive margins, largest differences exist in the hazard of exporting. There are significant differences in the hazard both across countries and time.
    Keywords: export differentiation; product types; hazard of exporting; intensive margin; extensive margin
    JEL: F14
    Date: 2010–10–30
  32. By: Gorton, Matthew; Sauer, Johannes; Peshevski, Mile; Bosev, Dane; Shekerinov, Darko; Quarrie, Steve
    Abstract: Drawing on Nahapiet and Ghoshal's (1998) distinction between the structural, relational, and cognitive dimensions of social capital, this paper analyses the performance of Water Communities (WCs) in the Bregalnica region of the Republic of Macedonia. WCs are farmer-managed local irrigation systems which are critical to livelihoods in Bregalnica. Data on the performance of the WCs and role of social capital was collected via in-depth interviews and a farm survey (n=249) of both members and non-members. Results highlight the importance of social capital in explaining the decision to join a WC, the satisfaction of members with their WC, and payment behaviour.
    Keywords: social capital, rural development, irrigation, rural development, Community/Rural/Urban Development, O13, P32, Q15,
    Date: 2010–08
  33. By: Mykhaylenko, Maryna; Schaft, Franziska
    Abstract: This contribution aims to analyze the main factors determining the initiation of vertical coordination between processing enterprises and milk producers in Ukraine. In this regard special attention is paid to the role of uncertainty, asset specificity and resource availability. Furthermore, the impact of vertical coordination on quality improvement, trust development and strategic advantages achieved is analyzed. The survey results indicate that uncertainty is a major driver for the processing level to initiate vertical coordination schemes. Although vertical coordination appears to have positive impacts on both supplier groups, corporate farms tend to benefit more from vertical coordination schemes than semi-subsistence farms.
    Keywords: vertical coordination, transaction costs, Ukraine, Community/Rural/Urban Development, L14, Q12,
    Date: 2010–08
  34. By: Zarnekow, Nana; Henning, Christian H.C.A
    Abstract: This paper focuses on networks as determinants of rural migration and the importance of networks in a rural development perspective. Furthermore the impact of public goods and amenities on migration decisions in rural regions is investigated. Special attention is paid on heterogeneity in peoples migration-decisive components. Data base is a non-farm household-survey of four rural communities in Poland. The estimations show that migration decisions are influenceable in different ways: Social networks as well as socio-economic components and the regional public-good endowment are important drivers of migration, but the direction and amount of influence depends on individual-preferences and on individual network-structures - among other things especially on the network-localization.
    Keywords: Migration, rural development, social networks, latent class model, Community/Rural/Urban Development, R23, D83, H41,
    Date: 2010–08
  35. By: Căpuşneanu, Sorinel/I; Barbu, Cristian Marian
    Abstract: This article axes on reorganization analysis of small and midsized enterprises of Romania starting from general principles identified by the specialists. Orientation of these principles is leading finally to transformation of vertical organization to a transversal organization way as Activity-Based Costing method (ABC). The stages that are passing through in the case of transversal organization of small and midsized enterprises from our country are evidenced and presented both theoretically and from a graphical representation point of view. The article ends with authors’ conclusions regarding the process of transversal reorganization of small and midsized enterprises, the authors pleading for using of this structural organization that is very profitable in actual Romanian conjuncture.
    Keywords: transversal organization; small and midsized enterprises; principles; operation; performance.
    JEL: M41 M21
    Date: 2010–04–15
  36. By: Marquardt, Doris; Moellers, Judith
    Abstract: LEADER supports integrated rural regional development. The programme is characterized by a participatory and bottom-up approach, public-private partnerships, multi-sectoral regional development strategies and innovation. An obligatory Common Monitoring and Evaluation Framework (CMEF) was set up for evaluating EU interventions. The CMEF builds upon sets of common indicators and evaluation questions. Romania, where LEADER is currently introduced, has set national priorities for the programme implementation. For assessing the impact of LEADER in Romania meaningfully, an extension of the CMEF is needed. This paper, identifies and suggests appropriate indicators. Social Network Analysis is proposed as a tool for investigating intangible outcomes of LEADER in a quantitative way.
    Keywords: LEADER, evaluation, Romania, social network analysis, common monitoring and evaluation system, Community/Rural/Urban Development, D79, P25, R19, R59,
    Date: 2010–08
  37. By: Wei Xu; Ostap Okhrin; Martin Odening; Ji Cao
    Abstract: The supply of affordable crop insurance is hampered by the existence of systemic weather risk which results in large risk premiums. In this article, we assess the systemic nature of weather risk for 17 agricultural production regions in China and explore the possibility of spatial diversification of this risk. We simulate the buffer load of hypothetical temperature-based insurance and investigate the relation between the size of the buffer load and the size of the trading area of the insurance. The analysis makes use of a hierarchical Archimedean copula approach (HAC) which allows flexible modeling of the joint loss distribution and reveals the dependence structure of losses in different insured regions. Our results show a significant decrease of the required risk loading when the insured area expands. Nevertheless, a considerable part of undiversifiable risk remains with the insurer. We find that the spatial diversification effect depends on the type of the weather index and the strike level of the insurance. Our findings are relevant for insurers and insurance regulators as they shed light on the viability of private crop insurance in China.
    Keywords: crop insurance, systemic weather risk, hierarchical Archimedean copulas
    JEL: C14 Q19
    Date: 2010–10
  38. By: Bojnec, Štefan; Bakucs, Lajos Zoltán; Ferto, Imre; Latruffe, Laure
    Abstract: The article investigates the impact of non-farm income on the investment for Hungarian and Slovenian farms using FADN panel data for the years 2004-2008 and different econometric estimation approaches. We find that non-farm income is more important for Slovenian farms than for Hungarian farms. Farm gross investment is positively associated with real sales growth and cash flow implying the absence of soft budget constraint. Gross farm investment is negatively associated with non-farm income, but positively associated with investment subsidies. Specific results by country are found depending on growing vs. declining real sales and on farm indebtedness.
    Keywords: non-farm income, farm investment, soft budget constraint, panel data analysis, Community/Rural/Urban Development, D81, D92, O12, Q12, C23,
    Date: 2010–08
  39. By: Gabriele, Alberto
    Abstract: Cuba’s post-revolutionary economic history was penalized by the twin sets of distortions stemming from its former, artificial trade relations with the CMEA and from the very nature of the state socialist model, let alone the severe costs imposed by the US embargo. Conversely, Cuba’s centralized resource allocation system and the consistent priority accorded to the satisfaction of basic needs were instrumental in engineering a remarkable accumulation of human capital and an extraordinary development of public services, and serendipitously endowed the country with a lingering comparative advantage in some advanced, knowledge-based services sectors. However, the tension between Cuba’s exceptional human development achievements and the weakness of their material foundation cannot be maintained indefinitely. The intrinsic deficiencies of the central planning mechanism, the need for expanding the role of the market and of monetary-commercial relations, and the inescapability of respecting the law of value and the socialist principle of distribution according to work should be fully acknowledged and translated in a structural reform program. The ultimate goal of such a program should be that of definitely superseding the traditional state socialist model, leading to a transition towards a specifically Cuban form of market socialism.
    Keywords: Socialism; Cuba
    JEL: B14 N16
    Date: 2010–10–27
  40. By: Radovan Parrák (Institute of Economic Studies, Faculty of Social Sciences, Charles University, Prague, Czech Republic); Jakub Seidler (Czech National Bank; Institute of Economic Studies, Faculty of Social Sciences, Charles University, Prague, Czech Republic)
    Abstract: This paper focuses on two methods for optimum portfolio selection. We compare Mean-Variance method with Mean-VaR method by the means of investment simulation, based on Czech financial market data from turbulent market periods of the year 2007 and the year 2008. We compare both strategies, basing on measurements of relative and absolute profitability of both strategies in crisis periods. The results indicate that both strategies were relatively profitable in both simulation periods. As a consequence of our results, it seems that it is worth to adhering investment decisions to outputs of optimisation algorithms of both methods. Moreover, we consider Mean-VaR strategy to be safer in turbulent times.
    Keywords: portfolio optimization, investment strategy, Mean-Variance, Mean-Var
    JEL: C52 G11
    Date: 2010–11
  41. By: Todorov, Kiril; Vittuari, Matteo
    Abstract: Public support for agriculture in R. Macedonia is characterized by a significant evolution, but it is still largely affected by the lack of a consistent long-term development-oriented strategy. Within this framework measures for agricultural and rural development are changing on annual basis generating consistent disorientation among final users. However, with the Strategy for Approximation of the Macedonian Agro-Food Sector to the CAP of the EU, Macedonian agricultural policy has taken a major step towards the process of identification of its own resources in order to create the necessary basis for the design of a new agriculture and rural development policy. The paper aims at assessing the place that agriculture has in the overall economy and especially in the rural areas of R. Macedonia, analyzing the basic structure and income and investigating how subsidies and support strategies are evolving in light of the European integration process.
    Keywords: subsidies, policy, resources, rural development, Community/Rural/Urban Development, Q18,
    Date: 2010–08
  42. By: Miaojie Yu (China Center for Economic Research)
    Abstract: This paper explores how processing trade, jointly with tariff reduction, can improve a firm's productivity. Tariff reductions generate productivity gain via competition, whereas processing export does so via spillovers. Using mostly disaggregated Chinese product-level trade data and firm-level production data from 2000--2006, after constructing firm-level tariffs based on product information and controlling for possible endogeneity, I found that a 10% tariff decrease generates a 12% increase in a firm's productivity gain. In addition, processing firms enjoy significant productivity gains via spillovers, with heterogeneity across firms divided according to ownership. These findings are robust to various econometric methods, disaggregated specifications, and measures.
    Keywords: Processing Trade, Productivity, Firmís Heterogeneity, Chinese Plants
    JEL: F1 L1 O1 O2
    Date: 2010
  43. By: Mishev, Plamen Dimitrov; Ivanova, Nedka Momcheva; Harizanova, Hristina Stefanova
    Abstract: The rural areas in Bulgaria cover more then 80% of the country territory and account for about 29% of the population. Their development depends strongly on agricultural sector. The paper examines structural changes in agriculture, labour market situation in rural areas and presents the main results of the survey performed in three region of Bulgaria. The study shows a substantial decline in the number of farm with economic size between 0,5 and 3 ESU and a stable increase in the number of large farms. Major factors having impact on farm restructuring are: improvements in economic situation, in particular the increase in real income, positive developments of land market, deterioration of age structure of rural population and the habits of rural population to keep some agricultural activity. An important development of subsistence and semi subsistence farms is observed indicating two opposite processes: a process of transforming of a small part of semi-subsistence into commercial farms or into higher economic size group and another part of them converged to subsistence farms. The number of subsistence farms with economic size 0,5 â 1 ESU also declined as the reduction is either due to reduction of farm activity or due to exit from the sector. The most important option for employment and source of income in villages studied is agriculture, but the earned income is much below the national average The most important factor having impact on a decision to start a job outside agriculture is âTo ensure households leaving standards/ generate cash incomeâ. Generally the respondents do not think that they will have possibility to start their self employed business outside agriculture in the next 5 years. Only 25% of them expect to stay in agriculture as nearly 50% of the commercial farms will keep operating and only 17% - 26% of small farms will remain in the sector
    Keywords: rural development, farm restructuring, labour markets, Community/Rural/Urban Development, J21, R23,
    Date: 2010–08
  44. By: Sauer, Johannes; Davidova, Sophia; Latruffe, Laure
    Abstract: The objective of this article is to investigate why farmers in Kosovo leave land fallow when the total land of their farms is small and households, almost fully dependent on farming for their livelihoods, are large. In order to elicit some of the barriers to land utilization, the article uses a comprehensive survey carried out during the agricultural year 2005/2006 to explore agricultural householdsâ perceptions of production, market conditions, and general security six years after the end of the military conflict in the former Yugoslavia. Several agro-environmental, household and farm characteristics are employed to empirically approximate the significance of different factors for leaving land fallow. Three different econometric models are used to address the characteristics of the dependent variable distribution by accounting for endogeneity. The main determinants of the share of land left fallow are found to be related to the economic and institutional structure: low profitability of farming; difficulty in accessing production factors and variable inputs; as well as uncertainty regarding property rights in land.
    Keywords: Fallow land decision, Kosovo, Endogeneity, Community/Rural/Urban Development, C24, Q12, Q15,
    Date: 2010–08
  45. By: Kopeva, Diana Ilieva; Peneva, Mariya Marinova; Madjarova, Svetla Ivanova
    Abstract: The sustainable development of rural areas faces nowadays the challenges of global changes. The need to adapt land and landscape use to the new social, economic and ecological demands (non-farm activities, employment in rural areas, forest and agro- related tourism, real estate pressure, etc.) requires an analysis of the land multifunctionality and of the multipurpose land management strategies. The paper aims to review the concept of land use and landscape multifunctionality and to review the role of multifunctional land use in Rural Development Policy in Bulgaria.
    Keywords: multifunctional land use, rural development, rural development policy, Bulgaria, Community/Rural/Urban Development, Q01, Q15, R58,
    Date: 2010–08
  46. By: Gogodze, Joseph; Uridia, Merab
    Abstract: The aim of the paper is to study statistical characteristics of the Research and Development (R&D) system of Georgia in years 1996-2005 and compare them with corresponding characteristics of the R&D system for the Europe Central Asia Region (ECA). We consider main short term and long term tendencies, which characterize dynamics of personnel, management, and funds in the R&D system of the following two country groups: countries of the ECA region and the former USSR states. As a result we conduct positioning of Georgia in relation with each of these groups. As a corollary we conclude that in the years 1996-2005 period Georgia could not secure funding and personal of its own R&D system and could not efficiently manage it. By main indicators of the R&D system Georgia is rather behind of leading post-USSR States and has very weak position in the ECA region.
    Keywords: R&D;Georgia;former USSR;ECA
    JEL: O3
    Date: 2010–04–27

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