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on Transition Economics |
| By: | Alexander Muravyev; Oleksandr Talavera |
| Abstract: | This paper takes advantage of a recent policy experiment in Ukraine's secondary education system to study the effect of stricter requirements for proficiency in the state language on linguistic minority students' demand for, as well as opportunities to pursue, further studies at the university level. The reform that we consider obligated all minority students, including those studying in public schools with a full cycle of education in minority languages, to take a standardized school exit test (which is also a university entry test) in Ukrainian, the state language, thus denying them previously granted access to translated tests. Using school-level data and employing the difference-in-difference estimator we find evidence that the reform resulted in a decline in the number of subjects taken by minority students at the school exit test. There was also a notable shift in the take-up of particular subjects, with fewer exams taken by minority students in more linguistically-demanding subjects such as History, Biology, and Geography, and more exams taken in foreign languages and Math. Overall, our results suggest some distortions in the accumulation of human capital by linguistic minority students induced by the language policy. |
| Keywords: | language policy, economics of minorities, education, Ukraine |
| JEL: | I28 J15 |
| Date: | 2010–12–29 |
| URL: | http://d.repec.org/n?u=RePEc:uea:aepppr:2010_23&r=tra |
| By: | Sai Ding; Alessandra Guariglia; John Knight |
| Abstract: | This paper attempts to address a puzzle in China’s investment pattern: despite high aggregate investment and remarkable economic growth, negative net investment is commonly found at the microeconomic level. Using a large firm-level dataset, we test three hypotheses to explain the existence and extent of negative investment in each ownership group: what we term the efficiency (or restructuring) hypothesis, the (lack of) financing hypothesis, and the (slow) growth hypothesis. Our panel data probit estimations shows that negative investment by state-owned firms can be explained mainly by inefficiency: owing to over-investment or mis-investment in the past, these firms have had to restructure and to get rid of obsolete capital in the face of increasing competition and hardening budgets. The financing explanation holds for private firms, which have had to divest in order to raise capital. However, rapid economic growth weighs against both effects in all types of firms, with a larger impact for firms in the private and foreign sectors. A tobit model, estimated to examine the determinants of the amount of negative investment, yields similar conclusions. |
| Keywords: | Negative investment; Divestment; Industrial restructuring; Financial constraints; Economic transition; China |
| JEL: | G3 O16 O53 |
| Date: | 2010–12 |
| URL: | http://d.repec.org/n?u=RePEc:gla:glaewp:2010_31&r=tra |
| By: | Zsolt Darvas |
| Abstract: | This paper assesses the impact of the 2008-09 global financial and economic crisis on the medium-term growth prospects of the countries of central and eastern Europe, the Caucasus and Central Asia, which began an economic transition about two decades ago. We use cross-country growth regressions, putting special emphasis on a proper consideration of the crisis and robustness. We find that the crisis has had a major impact on the within-sample fit of the models used and that the positive impact of EU enlargement on growth is smaller than previous research has shown. The crisis has also altered the future growth prospects of the countries studied, even in the optimistic but unrealistic case of a return to pre-crisis capital inflows and credit booms. |
| Keywords: | crisis, economic growth, growth regressions, transition countries |
| JEL: | C31 C33 O47 |
| Date: | 2010–12–22 |
| URL: | http://d.repec.org/n?u=RePEc:mkg:wpaper:1005&r=tra |
| By: | Gunther Schnabl (Institute for Economic Policy, University of Leipzig) |
| Abstract: | During the 1997/98 Asian crisis and the 2007-2010 world financial and economic crisis, China has proved to be a stabilizer for East Asia and the world. The paper stresses the crucial role of the dollar peg for macroeconomic stability in China. The paper explores the current role of China's nominal exchange rate stabilization as stabilizing factor for China, East Asia and the world economy. Distortions originating in real exchange rate stabilization are identified and are argued to be a risk for global growth perspectives. To prevent further economic and financial turmoil the paper recommends policy coordination between China and the US. The exit from unconventional low interest rate policies in the US combined with the end of real (but not nominal) exchange rate stabilization in China is seen as necessary to stabilize longterm growth in China, East Asia and the US. |
| Keywords: | China, dollar peg, structural distortions, international policy coordination, global imbalances |
| JEL: | F15 F31 F33 |
| Date: | 2011–01–10 |
| URL: | http://d.repec.org/n?u=RePEc:hlj:hljwrp:13-2010&r=tra |
| By: | Liping Jiang (Department of Environmental and Business Economics, University of Southern Denmark) |
| Abstract: | In this paper we present, for the first time, the price formation of China’s dry bulk carrier using vessel prices quoted by major Chinese shipyards in actual shipbuilding orders. This allows us to investigate the relationship of price and determinants in the Chinese shipbuilding industry by including generic market factors as well as Chinese elements. The analysis, employing Principal Component Regression (PCR) approach, indicates that the time charter rate has the most significantly positive impact. While increases in other four factors, namely shipbuilding cost, price cost margin, shipbuilding capacity utilization and credit rate, have descending order of positive influences. Different from traditional perception, we assert that the most important role of time charter rate plays mainly attributes to the ‘China Factor’ in bulk carrier sector. In addition, simulations are performed to investigate what would happen to the Chinese dry bulk carrier prices under changes of time charter rate and shipbuilding cost. This paper has implications for the Chinese shipyards, shipbuilding industry customers and industry policy makers. Acknowledgment - This research is partly funded by the Chinese Scholarship Council and TORM Foundation. |
| Keywords: | Price Formation, Dry Bulk Carrier, Chinese Shipbuilding Industry |
| Date: | 2010–12 |
| URL: | http://d.repec.org/n?u=RePEc:sdk:wpaper:104&r=tra |
| By: | Pietro Masina (Dept. of Social Sciences - University of Naples “L’Orientale”) |
| Abstract: | Since the mid 1980s Vietnam has launched a thorough programme of economic reforms, with a transition from central planning to a market-based economy. The gradual and pragmatic reform process achieved remarkable results in terms of sustainable economic growth and poverty reduction. With entrance into the WTO (in 2007), the country has become an important manufacturing hub and is attracting huge FDI flows, but with a risk of increased dependency from foreign capital and technology and vulnerability to exogenous shocks. This paper suggests that national authorities have so far (and rather successfully) relied on a large state sector to manage economic development but the government has not been able to design and implement coherent industrial strategies. |
| Keywords: | Vietnam, economic reform, industrial development, Washington Consensus. |
| JEL: | L52 O11 O19 O53 |
| Date: | 2010–12 |
| URL: | http://d.repec.org/n?u=RePEc:cme:wpaper:1007&r=tra |
| By: | Giles, John; Wang, Dewen; Zhao, Changbao |
| Abstract: | This paper shows that support from the family continues to be an important source of support for the rural elderly, particularly the rural elderly over 70 years of age. Decline in likelihood of co-residence with, or in close proximity to, adult children raises the possibility that China's rural elderly will receive less support in the forms of both income and in-kind instrumental care. Although descriptive evidence on net financial transfers suggests that the elderly with migrant children will receive similar levels of financial transfers as those without migrant children, the predicted variance associated with these transfers implies a higher risk that elderly with migrant children may fall into poverty. Reducing the risk of low incomes among the elderly is one important motive for new rural pension initiatives supported by China's government, which are scheduled to be expanded to cover all rural counties by the end of the 12th Five Year Plan in 2016. |
| Keywords: | Rural Poverty Reduction,Population Policies,Services&Transfers to Poor,Regional Economic Development,Labor Policies |
| Date: | 2010–12–01 |
| URL: | http://d.repec.org/n?u=RePEc:wbk:wbrwps:5510&r=tra |
| By: | Sai Ding; Alessandra Guariglia; John Knight |
| Abstract: | We use a panel of over 120,000 Chinese firms of different ownership types over the period 2000-2007 to analyze the linkages between investment in fixed and working capital and financing constraints. We find that those firms characterized by high working capital display high sensitivities of investment in working capital to cash flow (WKS) and low sensitivities of investment in fixed capital to cash flow (FKS). We then construct and analyze firm-level FKS and WKS measures and find that, despite severe external financing constraints, those firms with low FKS and high WKS exhibit the highest fixed investment rates. This suggests that good working capital management may help firms to alleviate the effects of financing constraints on fixed investment. |
| Keywords: | Investment; Cash flow; Financing constraints; Working capital |
| JEL: | D92 E22 |
| Date: | 2010–12 |
| URL: | http://d.repec.org/n?u=RePEc:gla:glaewp:2010_33&r=tra |
| By: | Jacky MATHONNAT (Centre d'Etudes et de Recherches sur le Développement International); Martine AUDIBERT (Centre d'Etudes et de Recherches sur le Développement International); Aurore PELISSIER (Centre d'Etudes et de Recherches sur le Développement International); Xiao Xian HUANG (-); Anning MA; Ningshan CHEN |
| Abstract: | Since 2003, the New Rural Cooperative Medical Scheme is gradually implemented in China, in order first, to increase access of the poor to health services, reduce out-of-pocket expenditures and avoid catastrophic health expenditures and second to re-oriented patient to township hospitals. The paper estimates the impact of the New Rural Cooperative Medical Scheme on a sample of 24 township hospitals of Weifang prefecture (Shandong province), using a generalized form of differences-in-differences model on longitudinal data over the period 2000-2008. The estimations conclude to the significant and positive impact of the New Rural Cooperative Medical Scheme on inpatient activities and on the bed occupancy rate, and to the significant and negative impact on the average length of stay. As expected, the impact on inpatient activities is higher in poor areas than in non poor ones and the marginal impact is decreasing over time. |
| Keywords: | China, New Rural Cooperative Medical Scheme, Impact analysis, Township Hospitals. |
| JEL: | O12 I38 I1 G22 |
| Date: | 2010 |
| URL: | http://d.repec.org/n?u=RePEc:cdi:wpaper:1227&r=tra |
| By: | Apostolov, Mico |
| Abstract: | The corporate governance issue in Macedonian companies has been brought forward during the recent few years. The main reason is the fact that the privatization process completion of socially-owned and partly state-owned enterprises has put emphasis to the challenge to reasonably regulate relationships established within companies on one hand, and relationships between companies and larger society on the other. All market economies, including those with longest tradition, have faced this kind of challenge so far. Corporate governance becomes an increasingly important issue for the Macedonian economy. It is being taken with greater consideration by the companies, regulators and government. The strong wave of privatization programs from mid-90’ have resulted in an altered business environment, and new legal and institutional frameworks have been established. Indeed, corporate governance contributes to sustainable economic development by enhancing the performance of companies and increasing their access to external sources of capital. In this paper we will make attempt to analyze the predominant factors that create prolific corporate governance environment in two terms; a) micro level and macro level. |
| Keywords: | governance; corporate governance; management strategy; transition; Southeast Europe; Macedonia |
| JEL: | O11 G38 G32 P31 G30 L33 |
| Date: | 2010–11 |
| URL: | http://d.repec.org/n?u=RePEc:pra:mprapa:27914&r=tra |
| By: | Jana Procházková (Institute of Economic Studies, Faculty of Social Sciences, Charles University, Prague, Czech Republic); Lenka Šťastná (Institute of Economic Studies, Faculty of Social Sciences, Charles University, Prague, Czech Republic) |
| Abstract: | The paper estimates cost efficiency of 99 general hospitals in the Czech Republic during 2001-2008 using Stochastic Frontier Analysis. We estimate a baseline model and also a model accounting for various inefficiency determinants. Group-specific inefficiency is present even having taken care of a number of characteristics. We found that inefficiency increases with teaching status, more than 20,000 treated patients a year, not-for-profit status and a larger share of the elderly in the municipality. Inefficiency decreases with less than 10,000 patients treated a year, larger population, and more hospitals in the region. |
| Keywords: | Efficiency, hospitals, stochastic frontier analysis |
| JEL: | D24 I11 |
| Date: | 2011–01 |
| URL: | http://d.repec.org/n?u=RePEc:fau:wpaper:wp2011_02&r=tra |
| By: | Constanta BODEA (Academy of Economic Studies, Bucharest, Romania); Isa TAK (Academy of Economic Studies, Bucharest, Romania) |
| Abstract: | An average annual rate of growth of 6.92% during 2002-2008 has ensured the gradual decrease in the gap between Romania and other EU member states. Key economic indicators are shown in Table 1. The main growth factor for this period has been the domestic demand. Having grown at a steady pace for several years, EU-27 value added generally peaked in the first quarter of 2008. Output fell by 16.6 % for industry to reach a low in the second quarter of 2009 (with modest signs of a recovery thereafter in the second half of 2009, (Eurostat, 2010). The European economy is in the midst of the deepest recession since the 1930s, with real GDP projected to shrink by some 4% in 2009, the sharpest contraction in the history of the European Union. Although signs of improvement have appeared recently, recovery remains uncertain and fragile (European Communities, 2009)." |
| JEL: | L20 |
| Date: | 2010–08 |
| URL: | http://d.repec.org/n?u=RePEc:rom:km2010:17&r=tra |
| By: | FANG Zheng (Division of Economics, Nanyang Technological University, Singapore, 639798); Chris SAKELLARIOU (Division of Economics, Nanyang Technological University, Singapore, 639798) |
| Abstract: | The Vietnam “renovation” reforms were implemented during the 1990s, but their full effect was only felt many years later. We present evidence on the developments in real wage growth and inequality in Vietnam from 1998 to 2008. For men, wage growth was underpinned by both increases in endowments of productive characteristics (mainly education) as well as changes in the wage structure (mainly associated with experience) and residual changes. For women, the wage structure effect was the main contributor to wage growth and the most important determinant was the change in the pattern of the returns to experience: younger, less experienced workers enjoyed a premium compared to more experience workers, reversing the previous, opposite pattern. Conventional measures of inequality as well as background analysis show that wage inequality decreased sharply through the 1990s until 2006, but increased subsequently. Over the entire 10-year period, wage inequality increased slightly and more so for women. |
| Keywords: | Wage inequality, counterfactual decompositions, Asia, Vietnam |
| JEL: | D33 J31 J42 |
| Date: | 2010–06 |
| URL: | http://d.repec.org/n?u=RePEc:nan:wpaper:1006&r=tra |
| By: | Albrecht Kauffmann |
| Abstract: | The rise in energy prices may result in long-lasting rise in costs of freight transports. Which effects do rising freight transport costs have for the development of urban systems? Such rise of transport costs in real terms has happened in Russia after price liberalisation in 1992. At the same time, the Russian official demographic statistics provides data that can be used to test hypotheses concerning the development of urban systems affected by rising transport costs. In the present study, these data are comprehensively evaluated. The theoretical background is provided by modelling of a linear shaped urban system in the framework of New Economic Geography. By means of this tool, analysis can be applied to spacious urban systems with large transport distances. For the first time, the underlying theoretical approach is explained in detail. The empirical results provide evidence for the outcomes of the theoretical model: In spacious countries or regions, respectively, whose urban systems are drawn-out on long lines, rising costs of freight transport are conducive to tendencies of concentration of population in large cities in the centre of the system, while peripheral regions are increasingly disconnected. |
| Keywords: | Russia, urban systems, New Economic Geography, migration |
| JEL: | R49 R23 R13 R12 P25 |
| Date: | 2010–11 |
| URL: | http://d.repec.org/n?u=RePEc:pot:psrawi:02&r=tra |
| By: | d'Artis Kancs; Julia Kielyte |
| Abstract: | The present paper studies how European integration might affect the migration of workers in the enlarged EU. Unlike the reduced-form migration models, we base our empirical analysis on the theory of economic geography à la Krugman (1991), which provides an alternative modelling of migration pull and push factors. Parameters of the theoretical model are estimated econometrically using historical migration data. Our empirical findings suggest that European integration would trigger selective migration between the countries in the enlarged EU. In the Baltics, Lithuania would gain about 7.25% of the total work force. In the Visegrád Four, the share of the mobile labour force would increase the most in Hungary, 8.35%, compared to the pre-integration state. Our predictions for the East-West migration are moderate and lower than those of reduced-form models: between 5.44% (from the Baltics) and 3.61% (from the Visegrád Four) would emigrate to the EU North. Because migrants not only follow market potential, but also shape the region’s market potential, the long-run agglomeration forces are sufficiently weak to make a swift emergence of a core-periphery pattern in the enlarged EU very unlikely. |
| Keywords: | New economic geography; Market potential; Labour migration; Economic integration. |
| JEL: | F12 L11 R12 R23 |
| Date: | 2010–07–27 |
| URL: | http://d.repec.org/n?u=RePEc:eei:rpaper:eeri_rp_2010_27&r=tra |
| By: | Ngo, Dang Thanh |
| Abstract: | Over the last twenty years in Vietnam, the financial system in general and the banking system in particular had been transferred from a monopoly system into a diversified system which allows all participants to compete fairly and effectively. Within these past years, the banking system in Vietnam did gradually developed in number of banking institutions, size of the banking sector in the economy, amount of credits for the economy, and amount of other banking services as well. Along with the development of the banking system in number, size, asset value, deposit, credit and debit account, ATM/POS, interest rates, etc. which attracted more and more customers using the banking’ services; the efficiency of the banking system also has been increasing. So far, there is still a lack of research on the efficiency of the banking sector in Vietnam over the decades. Several researches were conducted, however, due to the data limitation, these researches were just small steps at the big front gate. This paper, which focuses on evaluating the efficiency of bigger sample size of Vietnamese commercial banks in the year of 2008, tends to make a contribution to this progress. The DEA approach allows this paper to evaluate the efficiency of 22 Vietnamese commercial banks in using their inputs in 2008 (these banks were ranked top in the banking industry in Vietnam – VNR500 in 2009). After analyzing, the research comes to a conclusion that although the efficiency of these banks is averagely high, however, there is still an opportunity to improve this indicator. |
| Keywords: | Data envelopment analysis; Vietnam; bank; efficiency |
| JEL: | C14 G21 |
| Date: | 2010–05–10 |
| URL: | http://d.repec.org/n?u=RePEc:pra:mprapa:27882&r=tra |
| By: | Výrost, Tomáš; Baumöhl, Eduard; Lyócsa, Štefan |
| Abstract: | In this article, we contribute to the discussion of volatility persistence in the presence of sudden changes. We follow previous research, particularly Wang and Moore (2009), who analysed stock market returns in five Central and Eastern European countries using the Iterated Cumulative Sum of Squares (ICSS) algorithm for detecting multiple breaks and the test (IT) proposed by Inclán and Tiao (1994). We complement this analysis by using the κ1 and κ2 statistic introduced by Sansó et al. (2004), which lead us to the hypothesis that the estimated persistence in volatility depends inversely on the number of breakpoints in volatility. We explored this claim through a simulation study, where by randomizing an increasing number of breakpoints over the sample, we estimated kernel density of the persistence measure. The results confirmed the relationship between persistence and the number of breakpoints. It also showed that the use of break detection algorithms leads to lower persistence estimates, even within the class of models with an equal number of breaks. Therefore, the overall decrease in persistence can be attributed both to the number of breaks and their position, as suggested by the chosen break detection tests. |
| Keywords: | volatility persistence; GARCH model; ICSS procedure; CEE stock markets |
| JEL: | G15 C22 |
| Date: | 2011–01–06 |
| URL: | http://d.repec.org/n?u=RePEc:pra:mprapa:27927&r=tra |
| By: | Valentin – Stelian BADESCU (Romanian - German University, Sibiu) |
| Abstract: | In Romania, the introduction of internal audit is relatively recent fall in the overall effort to modernize financial management in both private and public sectors. Also, note that the introduction of public sector internal audit is not transposed in the Romanian economy features of the acquis communitarian, for the simple reason that there is no internal audit. At the same time, there is no legal framework and procedures to adapt to one of our member countries, since it does not correspond to current concepts of internal auditing and internal controls. |
| Keywords: | Internal audit, public law, management control systems |
| JEL: | M42 |
| Date: | 2010–08 |
| URL: | http://d.repec.org/n?u=RePEc:rom:km2010:37&r=tra |
| By: | Rudolph, Heinz P.; Holtzer, Peter |
| Abstract: | The overwhelming number of contributors that have been allocated into the default option is one of the main characteristics of the Russian second pillar. This finding confirms that the level of financial literacy for most of the participants is not sufficient to make informed portfolio selections. The authors argue that the current system is perfectly consistent with a solid second pillar, but the authorities should focus their attention in the strategic asset allocation of pension funds. Since in the short and medium term it is unlikely to see improvements in financial literacy of individuals that may overcome the complexity of these decisions, the authorities can play an important role in designing default investment portfolios that can be aligned with expected replacement rates for the contributors. The current investment regulation of the default option induces investment in inefficient portfolios that are unlikely to bring returns above inflation, and probably will result in very low replacement rates for contributors. Further liberalization of the investments of the pension portfolio; improvements in the governance and supervision of the pension system; and greater certainty about the ownership of the funds are necessary steps to complete the pension reform launched in 2002. |
| Keywords: | Debt Markets,Financial Literacy,Emerging Markets,Pensions&Retirement Systems,Access to Finance |
| Date: | 2010–10–01 |
| URL: | http://d.repec.org/n?u=RePEc:wbk:wbrwps:5514&r=tra |
| By: | Nidhiya Menon (Department of Economics, Brandeis University); Yana van der Meulen Rodgers (Rutgers University) |
| Abstract: | The study provides new evidence on gender differences in educational attainment, labor market status, health status, and land titling in Vietnam. Up-to-date statistical evidence on household well-being in Vietnam is particularly important given the heavy weight the government has placed on meeting the needs of vulnerable members of the population, reducing overall poverty, and improving societal well-being. Vietnam’s government has placed priority emphasis on achieving gender equality in the 2006 Law on Gender Equality. One of the major themes addressed in this report is Vietnam’s demonstrated progress in achieving social development targets. The study also identifies a few areas where female outcomes lag those of men, and suggests policies that might help to reduce the observed gaps. |
| Date: | 2010–11 |
| URL: | http://d.repec.org/n?u=RePEc:brd:wpaper:18&r=tra |