nep-tra New Economics Papers
on Transition Economics
Issue of 2012‒02‒27
thirty papers chosen by
J. David Brown
Heriot-Watt University

  1. Seven lessons from post-communist transition By Andrei Shleifer
  2. Why Has China Grown So Fast? The Role of International Technology Transfer By John Van Reenen; Linda Yueh
  3. MENA in transition: any lessons from CESEE? By Peter Havlik; Sandor Richter
  4. Bank stress tests as an information device for emerging markets: The case of Russia By Fungácová, Zuzana; Jakubík, Petr
  5. Integration of Chinese and Russian stock markets with world markets: National and sectoral perspectives By Babeckii, Ian; Komárek, Luboš; Komárková, Zlatuše
  6. The Impact of the Global Financial Crisis on Education Services in Economies of the Former Soviet Union By Irina Sinitsina
  7. Strategic Interactions in Environmental Regulation Enforcement: Evidence fromChinese Provinces By Mary-Françoise RENARD; Hang XIONG
  8. Effects of One-Sided Fiscal Decentralization on Environmental Efficiency of Chinese Provinces By Hang XIONG
  9. Innovating Like China: a Theory of Stage-Dependent Intellectual Property Rights By Angus C. Chu; Guido Cozzi; Silvia Galli
  10. Is China Different? A Meta-Analysis of China’s Financial Sector Development By Ljungvall, Christer; Gustavsson Tingvall, Patrik
  11. Determinants of carry trades in Central and Eastern Europe By Hoffmann, Andreas
  12. Russia’s Accession to the WTO: Impacts and Challenges By Irina Tochitskaya
  13. Key Issues and Developments in Farmland Rental Markets in EU Member States and Candidate Countries By Ciaian, Pavel,; Kancs, d’Artis; Swinnen, Jo; Van Herck, Kristine; Vranken, Liesbet
  14. Agricultural Land Markets and Land Leasing in the Former Yugoslav Republic of Macedonia By Angelovska, Neda Petroska; Ackovska, Marija; Bojnec, Štefan
  15. The office furniture market in China By Aurelio Volpe
  16. Revival of the Visegrad Countries’ Mutual Trade after their EU Accession: a Search for Explanation By Neil Foster; Gabor Hunya; Olga Pindyuk; Sandor Richter
  17. Rental Market Regulations for Agricultural Land in EU Member States and Candidate Countries By Ciaian, Pavel,; Kancs, d’Artis; Swinnen, Jo; Van Herck, Kristine; Vranken, Liesbet
  18. Azerbaijan’s Fiscal Policy after the Oil Boom By Dmytro Boyarchuk
  19. Active margin system for margin loans and its application in Chinese market: using cash and randomly selected stock as collateral By Guanghu Huang; Wenting Xin; Weiqing Gu
  20. Food standards and exports : evidence from China By Mangelsdorf, Axel; Portugal-Perez, Alberto; Wilson, John S.
  21. The Crime of Tax Evasion in Transition Economies By Barbara G. Katz; Joel Owen
  22. Sales Market Regulations for Agricultural Land in EU Member States and Candidate Countries By Ciaian, Pavel,; Kancs, d’Artis; Swinnen, Jo; Van Herck, Kristine; Vranken, Liesbet
  23. Chinese Investment in Latin American Resources: The Good, the Bad, and the Ugly By Barbara Kotschwar; Theodore H. Moran; Julia Muir
  24. The Impact of the Global Financial Crisis on Public Health Expenditures in the Economies of the Former Soviet Union By Roman Mogilevsky
  25. Labour Market Reforms and Outcomes in Estonia By Brixiova, Zuzana; Égert, Balázs
  26. Provision of Long Term Care for the Elderly in Poland in Comparison to Other European Countries By Izabela Styczynska (Marcinkowska)
  27. Export, Productivity Pattern, and Firm Size Distribution By Sun, Churen; Zhang, Tao
  28. Key Issues and Developments in Farmland Sales Markets in the EU Member States and Candidate Countries By Ciaian, Pavel,; Kancs, d’Artis; Swinnen, Jo; Van Herck, Kristine; Vranken, Liesbet
  29. Calibrating a cross-European poverty line By Berthoud, Richard
  30. What price nationalism? By Vladimir Gligorov

  1. By: Andrei Shleifer
    Abstract: The 20th anniversary of the beginning of economic reforms in Eastern Europe and the Former Soviet Union provides a good opportunity to comment on the lessons of transition says Andrei Shleifer, a Professor of Economics at Harvard University. He made a top seven list, which might be useful to future reformers. Some of the issues are relevant not only for communist countries; the problems of heavily statist economies are similar.
    Keywords: Post-communist transition and development issues, Eastern Europe, Caucasus and Central Asia, economic reforms
    Date: 2012–02
  2. By: John Van Reenen; Linda Yueh
    Abstract: Chinese economic growth has been spectacular in the last 30 years. We investigate the role of International Joint Ventures with Technology Transfer agreements, an understudied area. Technology transfer is the traditional mechanism for developing countries to "catch up" and has been a key component of Chinese economic policy. We collect original survey data on Chinese firms and their joint ventures and match this to administrative data on firm performance. To identify the causal effect of joint ventures we use time-varying and province-specific policies at the time when a firm was born. International joint ventures have large effects on productivity especially when combined with a technology transfer component. We estimate that without International joint ventures China's growth would have been about one percentage point lower per annum over the last three decades.
    Keywords: China, technology transfer, joint ventures, productivity
    JEL: O32 O33
    Date: 2012–02
  3. By: Peter Havlik (The Vienna Institute for International Economic Studies, wiiw); Sandor Richter (The Vienna Institute for International Economic Studies, wiiw)
    Abstract: In the wake of the ‘Arab Spring’ several observers compared the changes in the Middle East and North Africa (MENA) to the transition of the former communist countries in Central, East and Southeast Europe (CESEE) to parliamentary democracy and market economy starting two decades ago.Relying on the wiiw’s long standing experience in analysing both the centrally planned economic systems and the institutional and economic aspects of transition, the following Policy Note attempts – without claiming to have a detailed knowledge regarding MENA countries at the moment - to find possible common features, similarities and/or differences between the economic situation of the MENA countries and the challenges facing the former centrally planned economies during the past two decades. The aim of this note is to contribute to discussion regarding the elaboration of a strategy assisting MENA’s economic transition.
    Keywords: competitiveness, economic reforms
    Date: 2011–07
  4. By: Fungácová, Zuzana (BOFIT); Jakubík, Petr (BOFIT)
    Abstract: The recent financial crisis emphasised the need for effective financial stability analyses and tools for detecting systemic risk. This paper looks at assessment of banking sector resilience through stress testing. We argue such analyses are valuable even in emerging economies that suffer from limited data availability, short time series and structural breaks. We propose a top-down stress test methodology that employs relatively limited information to overcome this data problem. Moreover, as credit growth in emerging economies tends to be rather volatile, we rely on dynamic approach projecting key balance sheet items. Application of our proposed stress test framework to the Russian banking sector reveals a high sensitivity of the capital adequacy ratio to the economic cycle that shows up in both of the two-year macroeconomic scenarios considered: a baseline and an adverse one. Both scenarios indicate the need for capital increase in the Russian banking sector. Furthermore, given that Russia’s banking sector is small and fragmented relative to advanced economies, the loss of external financing can cause profound economic stress, especially for medium-sized and small enterprises. The Russian state has a low public debt-to-GDP ratio and plays decisive role in the banking sector. These factors allow sufficient fiscal space for recapitalisation of problematic banks under both of our proposed baseline and adverse scenarios.
    Keywords: stress testing; bank; Russia
    JEL: G21 G28 P34
    Date: 2012–02–23
  5. By: Babeckii, Ian (BOFIT); Komárek, Luboš (BOFIT); Komárková, Zlatuše (BOFIT)
    Abstract: Interest in examining the financial linkages of economies has increased in the wake of the 2008/2009 global financial crisis. Applying the concepts of beta- and sigma-convergence of stock market returns, we assess changes over time in the degree of stock market integration between Russia and China as well as between them and the United States, the euro area and Japan. Our analysis is based on national and sectoral data spanning the period September 1995 to October 2010. Overall, we find evidence for gradually increasing stock market integration after the 1997 Asian financial crisis and the 1998 Russian financial crisis. Following a major disruption caused by the 2008/2009 global financial crisis, the process of stock market integration resumes between Russia and China, and with world markets. Notably, the episode of sigma-divergence from the 2008/2009 crisis is stronger for China than Russia. We also find that the process of stock market integration and the impact of the recent crisis have not been uniform at the sectoral level, suggesting potential for diversification of risk across sectors.
    Keywords: stock market integration; beta-convergence; sigma-convergence; China; Russia; sectoral and national analysis
    JEL: C23 G12 G15
    Date: 2012–02–23
  6. By: Irina Sinitsina
    Abstract: The global economic crisis has created new challenges for education systems all over the world. The Former Soviet Union countries were confronted with an urgent issue, not necessarily specifically related to the crisis: to formulate and introduce new educational curricula, standards, and delivery models in order to adjust to the challenges imposed by the transition to the post-industrial stage of development. Irina Sinitsina summarised her chapter in the CASE Network Report No. 100 "The Impact of the Global Financial Crisis on Education Services in Economies of the Former Soviet Union" in this E-brief. Using the available data, she comes to the conclusion that during the crisis, the education system of FSU countries were not dramatically affected by overall budget cuts.
    Keywords: Economic crisis, Labor market, social policy and social services, Eastern Europe, Caucasus and Central Asia, education, FSU
    Date: 2012–02
  7. By: Mary-Françoise RENARD (Centre d'Etudes et de Recherches sur le Développement International); Hang XIONG
    Abstract: This paper studies whether Chinese provinces set strategically their environmental stringency when faced with interprovincial competition for mobile capital. Using Chinese provincial data and spatial panel econometric models, we find that Chinese provinces do engage in this kind of strategic interaction, particularly among those with similar industrial structure. Furthermore, we haven't found evidence of asymmetric responsiveness suggested by the race to the bottom theory. Finally, the one-sided fiscal decentralization is likely to strengthen the strategic behavior. These empirical results call for a skeptical attitude towards China's decentralization of environment policy implementation as well as its fiscal arrangements.
    Keywords: China, strategic interaction, pollution, spatial panel
    JEL: C2 Q5 H7 R5
    Date: 2012
  8. By: Hang XIONG
    Abstract: China's actual fiscal decentralization is one-sided: while public expenditures are largely decentralized, fiscal revenues are recentralized after 1994. One critical consequence of the actual system is the creation of significant fiscal imbalances at sub-national level. This paper investigates empirically effects of fiscal imbalances on environmental performance of Chinese provinces. First, environmental efficiency scores of Chinese provinces are calculated with SFA for the period from 2005 to 2010. Then, these scores are regressed against two fiscal imbalance indicators in a second stage model. Finally, conditional EE scores are calculated. This paper finds that effects of fiscal imbalances on EE are nonlinear and conditional on economic development level. Fiscal imbalances are more detrimental to environment in less developed provinces. These results suggest that the one-sided fiscal decentralization in China may have regressive environmental effects and contribute to regional disparity in terms of sustainable development.
    Keywords: Chinese provinces, Decentralization; Environmental efficiency; SFA
    JEL: R51 H70 Q56
    Date: 2012
  9. By: Angus C. Chu (Durham Business School); Guido Cozzi (Durham Business School); Silvia Galli (Hull University Business School)
    Abstract: Inspired by the Chinese experience, we develop a Schumpeterian growth model of distance to frontier in which economic growth in the developing country is driven by domestic innovation as well as imitation and transfer of foreign technologies through foreign direct investment. We show that optimal intellectual property rights (IPR) protection is stage-dependent. At an early stage of development, the country implements weak IPR protection to facilitate imitation. At a later stage of development, the country implements strong IPR protection to encourage domestic innovation. We also calibrate the model to aggregate data of the Chinese economy to simulate the optimal path of patent strength, which is increasing as the country evolves towards the world technology frontier, and this dynamic pattern is consistent with the actual evolution of the patent system in China. Furthermore, we provide empirical evidence based on a dynamic panel regression to support the key mechanism in our theoretical model.
    Keywords: economic growth; stage-dependent intellectual property rights
    JEL: O31 O34 O40
    Date: 2011–11–26
  10. By: Ljungvall, Christer (Copenhagen Business School); Gustavsson Tingvall, Patrik (The Ratio Institute)
    Abstract: We examine whether China has benefited more than other countries from financial sector development by performing a meta-analysis of the relevant literature covering a large number of countries at different stages of development. Although the results for China are inconclusive, they indicate the absence of a direct link between financial development and economic growth.
    Keywords: meta-analysis; financial sector development; economic growth; China
    JEL: F43 G20 O11 O53
    Date: 2012–02–17
  11. By: Hoffmann, Andreas
    Abstract: In this paper, I analyze determinants of carry trade returns in Central and Eastern Europe (CEE). I show that carry trades to CEE were lucrative due to interest rate spreads between the funding and investment currency from 2004 to 2006. They became unprofitable when liquidity risk and exchange rate volatility increased after 2007. The analysis suggests that the exchange rate regime of the CEE economy matters for carry trade returns. Overall, exchange rate stabilization, particularly via managed floats, seems to allow for the highest profit opportunities. --
    Keywords: carry trades,emerging markets,exchange rates
    JEL: E32 E44 F31 G11
    Date: 2011
  12. By: Irina Tochitskaya
    Abstract: On December 16th, 2011, an 18 year long negotiation process regarding Russia’s WTO membership was finally brought to an end. Undoubtedly, Russia’s WTO accession is an important event both for the global trade system and for the country. With Russia now in the club, the WTO will control over 97 per cent of global trade.
    Keywords: Russia, WTO, trade
    Date: 2012–01
  13. By: Ciaian, Pavel,; Kancs, d’Artis; Swinnen, Jo; Van Herck, Kristine; Vranken, Liesbet
    Abstract: In this paper, we describe recent developments in the rental market for agricultural land in selected EU member states and candidate countries. The analysis focuses on the importance of the rental market as well as on the evolution of rental prices. It appears that the share of rented land in the total utilised agricultural area varies considerably among member states. In the old member states, the share of rented land ranges between 18% in Ireland and 74% in France, while in the new member states (NMS) it ranges from 17% in Romania to 89% in Slovakia. For the former, different strategies to provide tenure security to tenants can explain differences in the importance of rental markets. Changes in the significance of land rental have also reflected changes in institutions and in economic and political conditions. In the NMS, diverse approaches to land reform have resulted in assorted ownership structures and hence in differences in the share of rented land. Regarding rental prices, governments impose price restrictions on agricultural land rents in some countries, such that large divergences are observed in rental prices between and within member states.
    Date: 2012–02
  14. By: Angelovska, Neda Petroska; Ackovska, Marija; Bojnec, Štefan
    Abstract: The aim of this study is to identify the driving forces that shape agricultural land structures, land market and land leasing in the Former Yugoslav Republic of Macedonia (FYROM). Institutional developments and land reforms have so far been modest in the FYROM, and have not contributed to significant changes in agricultural ownership, operational structures, or land market and land leasing arrangements. Land ownership and land use are bimodal, consisting of several small-scale family farms and a few large-scale agricultural enterprises. The small family farms own and operate land on several small parcels, which is one of the major obstacles to the modernisation of family farm production. They produce food for household subsistence with mixed crop, fruit, vegetable, grapevine and livestock production. A considerable portion of the land is uncultivated, which affects land market and land leasing values. Due to underdeveloped institutional frameworks and market institutions in support of small-scale farms, a large proportion of state-owned land is rented by agricultural enterprises.
    Date: 2012–02
  15. By: Aurelio Volpe (CSIL Centre for Industrial Studies)
    Abstract: This research provides office furniture market size, trends in office production, consumption, office furniture imports and exports. The office furniture production is broken down by segment (seating, operative furniture, executive furniture, filing and storage system, wall to wall units). Office furniture imports and exports are broken down by country and geographical area of origin/destination. Short profiles of the leading furniture chains and DIY stores in China are also available.. An analysis of the market potential focuses on construction sector and office spaces evolution, Chinese richest cities, luxury retail location and trends in the hospitality sector. About 97 addresses of key operators (both manufacturers and architectural companies) are included. The study has been carried out involving direct interviews with roughly 60 sector firms and distributors operating on the Chinese market.
    JEL: L11 L22 L68 L81
    Date: 2012–01
  16. By: Neil Foster (The Vienna Institute for International Economic Studies, wiiw); Gabor Hunya (The Vienna Institute for International Economic Studies, wiiw); Olga Pindyuk (The Vienna Institute for International Economic Studies, wiiw); Sandor Richter (The Vienna Institute for International Economic Studies, wiiw)
    Abstract: After the Visegrad countries’ accession to the EU in 2004, one of the most remarkable developments was the sudden upturn in their mutual trade. In 2007 the value of aggregate intra-Visegrad trade was two and a half times higher than in 2003. The rate of growth in these countries’ trade with the EU 15 (the ‘old’ member states) was only half as much. Also, individual Visegrad countries showed higher export growth rates to other Visegrad members in the post-accession period than in the years before EU accession. These developments are reflected in the changes in the geographical distribution of trade. While the relative significance of intra-Visegrad trade increased substantially both in the immediate pre-accession years (2000-2003) and the immediate post-accession years (2004-2007), the shifts in favour of intra-Visegrad trade were stronger in the years after accession in the case of all four countries and in both exports and imports. Three years after the EU accession the relative significance of intra-Visegrad trade attained the level it had reached in 1985, that time still under the extreme protection from global competition provided by the CMEA.The research to find an explanation for the upturn of intra-Visegrad Group trade was primarily focused on the identification of changes in the composition of trade. This approach was supplemented by an investigation of intra-bloc trade in services and an analysis of the mutual FDI flows among the countries concerned.Various trade structure indicators (traditional descriptive, marginal intra-industry and revealed comparative advantage indicators), calculated in the framework of this research, show that accession to the EU has not brought about any abrupt changes in the commodity patterns and revealed comparative advantages. In bilateral trade relations, apart from some exceptions, the changes observed were typically continuous and gradual, overarching the whole period 2000-2007. This is, however, no reason to claim that EU accession had a minor role in the upturn of mutual trade in the region concerned – rather, the effect is not focused on the year of accession (and +/– one year). Despite the clearly hesitant attitude of the incumbent EU members towards eastern enlargement in the 1990s and the lack of their final commitment up until 2002, with the year of accession approaching it became more and more obvious that the accession would take place indeed. In this gradual process of self-conviction the firms involved in the intra-Visegrad Group trade may have gradually elaborated their new, geographically more diversified sales/procurement strategy. In the new strategic concepts of the main exporting firms (mostly multinationals) the Visegrad region itself is thought to have been upgraded both as a target for sales and as a host of potential cooperation partners for production. Results from the gravity modelling exercise indicated that there was no significant change in intra-Visegrad trade post-2004 after controlling for typical gravity determinants. Combined with the observed increase in intra-Visegrad trade these results would tend to suggest that the observed increases in trade were largely the result of the relatively strong rates of growth of per capita GDP in Visegrad countries and not due to accession per se. The results from the gravity exercise further indicate that the changes in intra-Visegrad trade have occurred mainly along the extensive margin, with a greater variety of products traded amongst Visegrad countries. Services trade was found to be too low to cause any significant productivity changes that would influence merchandise exports dynamics of the Visegrad countries. The prevalence of traditional transport and travel services in the services trade structures also points to a lower importance of services for the countries’ economies, in particular for merchandise trade developments. Our results may indicate an insufficient level of development of Visegrad countries yet, which prevents them from using services more efficiently.EU accession did not have a one-time effect on FDI among the Visegrad countries and also the comparison of the pre- and post-accession periods does not reveal any increase in the importance of mutual investments. This means that it was not mutual FDI that was driving trade. FDI among the Visegrad countries is rather low because there are not many local companies that are able to invest abroad. Those that do invest in the Visegrad area aim at serving mainly the local market of the target country, which has little trade-enhancing effect. There must be, however, a link between mutual trade and FDI from outside the region. Most of the Visegrad countries’ exports are generated by foreign subsidiaries of multinationals from the EU-15 and other developed countries. These subsidiaries are linked by intra-company trade, sourcing and selling in the Visegrad region. After EU enlargement, foreign investors have concentrated the production of consumer goods sold in the region in a lower number of locations which also generated trade among the Visegrad countries.Our analysis has an important message for the Southeast European countries, all aspiring for EU membership and simultaneously participating in the regional free trade agreement CEFTA. Facilitating the upturn of mutual trade by the governments concerned has been regarded by the EU as an important step towards membership. The research results testify that in the process of the intra-bloc trade revival the year of EU accession does not appear in the time series as a major watershed in terms of commodity patterns, intra-industry trade or revealed comparative advantage. The developments, primarily specialization, took place gradually, starting prior to and continuing after the accession to the EU. That does not exclude that the removal of administrative and other, mainly invisible obstacles to free trade on the day of accession did not support the upswing of mutual trade, but it could not be the major force behind the phenomenon as it took place in the bilateral Visegrad–EU-15 trade as well, without producing a spectacular upturn in that relation. Our assumption is that the likely driving force of the intra-Visegrad trade expansion has been a change in the networking strategy of the multinational companies located in the region around the date of EU accession. This change manifested itself in upgraded intra-firm deliveries among affiliates located in two or more of the four Visegrad countries.In this sense the increasing presence of multinational firms (more FDI projects and related inflows) is the key to rapid expansion of intra-CEFTA trade. This is, however, closely related to the prospects of the individual CEFTA members concerning the date of their EU accession. The legal stability provided by the gradual takeover of the acquis communautaire, on the one hand, and the prospects of removing all administrative and other, invisible obstacles to trade within the CEFTA region, on the other hand, are the connecting link between FDI, EU accession and an upturn in intra-CEFTA trade. Thus the summarized policy recommendation from our project for the Southeast European EU aspirants is that good progress in the accession negotiations, professional preparatory work for starting such talks and, further, the creation of an FDI-friendly regulatory environment may become key elements of a policy targeted at the upswing of intra-regional trade.
    Keywords: intra-regional trade, Visegrad Group, CEFTA, trade patterns, intra-industry trade, revealed comparative advantage, marginal intra-industry trade, volume and variety of goods traded, gravity model, trade in services, FDI
    JEL: F13 F14 F15 F23
    Date: 2011–07
  17. By: Ciaian, Pavel,; Kancs, d’Artis; Swinnen, Jo; Van Herck, Kristine; Vranken, Liesbet
    Abstract: In this paper, we describe the regulations governing the rental markets for agricultural land in selected EU member states and candidate countries. The analysis focuses on various kinds of regulations and institutions connected with the land rental market, including price, tenancy duration, quantity and other regulations, as well as transaction costs. The diverse government regulations on price restrictions and tenancy duration are analysed, along with the social norms observed for rental payments and contracts. The paper also examines the type and registration of contracts, the contract enforcement rules, the regulations on the inheritability of contracts and the pre-emptive right of tenants to buy the land.
    Date: 2012–02
  18. By: Dmytro Boyarchuk
    Abstract: Azerbaijan’s current fiscal stance is quite strong; however, this stability is completely based on oil-related revenues. In the meantime, the situation with alternative sources of fiscal revenues is uncertain. A large part of fiscal management is built on opacity and an assessment of budget spending efficiency has never been done. It is likely that Azerbaijan will only be able to maintain its fiscal stability through the next ten years or so, i.e. until the end of the active oil-extraction period. In the more distant future, a substantial fiscal correction will be necessary.
    Keywords: Institutional reforms, Eastern Europe, Caucasus and Central Asia, Azerbaijan
    Date: 2012–01
  19. By: Guanghu Huang; Wenting Xin; Weiqing Gu
    Abstract: An active margin system for margin loans is proposed for Chinese margin lending market, which uses cash and randomly selected stock as collateral. The conditional probability of negative return(CPNR) after a forced sale of securities from under-margined account in a falling market is used to measure the risk faced by the brokers, and the margin system is chosen under the constraint of the risk measure. In order to calculate CPNR, a recursive algorithm is proposed under a Markov chain model, which is constructed by sample learning method. The resulted margin system is an active system, which is able to adjust actively with respect to the changes of stock prices and the changes of different collateral. The resulted margin system is applied to 30,000 margin loans of 150 stocks listed on Shanghai Stock Exchange. The empirical results show the number of margin calls and the average costs of the loans under the proposed margin system are less than their counterparts under the system required by SSE and SZSE.
    Date: 2012–02
  20. By: Mangelsdorf, Axel; Portugal-Perez, Alberto; Wilson, John S.
    Abstract: Using a new database on Chinese food standards, this paper estimates the impact of volunta-ry and mandatory standards on its agricultural and food exports. The dataset covers seven Chinese products from 1992 to 2008. The findings here indicate that standards have a posi-tive effect on China's export performance. Standards signal to customers that products meet certain quality measures and promote information exchange. The benefits of increased ex-ports outweigh compliance costs. Our results also show that theses positive effects are larger when the standards are consistent with international norms.
    Keywords: Food&Beverage Industry,Information Security&Privacy,Labor Policies,Scientific Research&Science Parks,Science Education
    Date: 2012–02–01
  21. By: Barbara G. Katz; Joel Owen
    Date: 2011
  22. By: Ciaian, Pavel,; Kancs, d’Artis; Swinnen, Jo; Van Herck, Kristine; Vranken, Liesbet
    Abstract: All agricultural markets are subjected to institutional regulations that – in one way or another –affect the functioning of these markets, and this is no different for the agricultural land market in the EU. In this paper, we describe the existing regulations in the sales markets for agricultural land in selected EU member states and candidate countries. The analysis focuses on three types of sales market regulations and institutions: quantity regulations, price regulations and transaction costs. The differences in the regulatory framework between land acquisition and ownership by domestic and foreign investors are analysed, as well as the taxes associated with land sales and ownership, zoning regulations and market imperfections.
    Date: 2012–02
  23. By: Barbara Kotschwar (Peterson Institute for International Economics); Theodore H. Moran (Peterson Institute for International Economics); Julia Muir (Peterson Institute for International Economics)
    Abstract: China's need for vast amounts of minerals to sustain its high economic growth rate has led Chinese investors to acquire stakes in natural resource companies, extend loans to mining and petroleum investors, and write long-term procurement contracts for oil and minerals in Africa, Latin America, Australia, Canada, and other resource-rich regions. These efforts to procure raw materials might be exacerbating the problems of strong demand; "locking up" natural resource supplies, gaining preferential access to available output, and extending control over the world's extractive industries. But Chinese investment need not have a zero-sum effect if Chinese procurement arrangements expand, diversify, and make more competitive the global supplier system. Previous Peterson Institute research (see Moran 2010) and new research undertaken in this paper, show that the majority of Chinese investments and procurement arrangements serve to help diversify and make more competitive the portion of the world natural resource base located in Latin America. For a more comprehensive analysis, we conduct a structured comparison of four Peruvian mines with foreign ownership: two Organization for Economic Cooperation and Development-based, and two Chinese. We examine what conditions or policy measures are most effective in inducing Chinese investors to adopt international industry standards and best-practices, and which are not. We distill from this case study some lessons for other countries in Latin America, Africa, and elsewhere that intend to use Chinese investment to develop their extractive sectors: first, that financial markets bring accountability; second, that the host country regulatory environment makes a significant difference; and third, that foreign investment is a catalyst for change.
    Keywords: Chinese foreign direct investment, foreign direct investment (FDI), natural resources, Peru, environmental impact, corporate social responsibility.
    JEL: F14 F16 F21 F22 F59 O16 O54 Q31 Q32 Q34 Q38
    Date: 2012–02
  24. By: Roman Mogilevsky
    Abstract: The financial crisis strongly affected the countries of the former Soviet Union1 (FSU) in 2008-2009. All of the countries experienced either a recession or a considerable slowdown in growth. Under such conditions, public expenditures on health were at risk of being cut. This brief explores whether or not this actually happened and why or why not.
    Keywords: Global Financial Crisis, economy, Public Health Expenditures, Former Soviet Union
    Date: 2011–09
  25. By: Brixiova, Zuzana (United Nations Development Programme (UNDP), Swaziland); Égert, Balázs (OECD)
    Abstract: The unemployment rate in Estonia rose sharply in 2010 to one of the highest levels in the EU, after the country entered a severe recession in 2008. While the rate declined relatively rapidly in 2011, it remained high especially for the less educated. In 2009, the Employment Contract Law relaxed employment protection legislation and sought to raise income protection of the unemployed to facilitate transition from less to more productive jobs while mitigating social costs. Utilizing a search model, this paper shows that increasing further labour market flexibility through reducing the tax wedge on labour would facilitate the structural transformation and reduce the long-term unemployment rate. Linking increases in unemployment benefits to participation in job search or training programmes would improve the unemployed workers' incentives to search for jobs or retrain and the medium term labour market outcomes. Social protection schemes for the unemployed should be also strengthened as initially intended to give the unemployed sufficient time to search for adequate jobs or retrain for new opportunities.
    Keywords: labour market reforms, search model, Estonia, OECD countries
    JEL: J08 J64 E24
    Date: 2012–02
  26. By: Izabela Styczynska (Marcinkowska)
    Abstract: In recent years, population ageing has attracted the attention of research and policy advisors in all European countries. Several policy actions have been directed toward ensuring optimal long-term care (LTC) for elderly people while maintaining fiscal rationality. LTC systems are very different across all European countries. Their design is characterized by diverse arrangements for the provision of care/organization and financing. Despite general concerns, the Polish LTC system is still at the bottom of the pile in terms of the organization and provision of care.
    Keywords: LTC system,Labor market, social policy and social services, Europe, long-term care
    Date: 2012–02
  27. By: Sun, Churen; Zhang, Tao
    Abstract: We show in the Chinese Annual Survey of Industrial Firms that size distributions of non-exporters and exporters have different shapes, which can only be explained by assuming that their productivity distributions have different shapes. Empirical estimations verify this assumption. This paper also analyzes the relationship between firms' size and productivity distributions and shows that: 1) productivity and size distributions change accordingly, and 2) productivity is deterministic for size distribution.
    Keywords: Heterogeneous firm; Pareto distribution; Production size; Productivity heterogeneity
    JEL: D21 F12 D24
    Date: 2012–01–03
  28. By: Ciaian, Pavel,; Kancs, d’Artis; Swinnen, Jo; Van Herck, Kristine; Vranken, Liesbet
    Abstract: This paper describes recent developments in sales markets of agricultural land in selected member states of the European Union and its candidate countries. Analysis focuses on the importance of the sales market for agricultural land, the average size of transacted plots, and the evolution and magnitude of the land sales prices. The share of agricultural land sold on the market is relatively stable in most of the old member states, with the exception of Finland, the Netherlands and the UK, where a more dynamic market is observed. For the new member states, the sales market for agricultural land is strongly affected by public sales under the ongoing land privatisation programmes, while strong variation prevails in the private sales market. Substantial differences are also observed in both the average size of the transacted plots and the sales prices. For the latter, price regulations partially explain the heterogeneity in the evolution of sales prices.
    Date: 2012–02
  29. By: Berthoud, Richard
    Abstract: How should relative poverty be defined and measured in a European Union where there are substantial variations in income between countries, as well as within countries? This paper uses objective and subjective deprivation indicators to assess the appropriate balance between national and Europe-wide relativities in explaining social exclusion. The analysis suggests that Europe-wide comparisons are more important to the perception of poverty than the convention of national relative poverty lines would have led us to expect. Even relative poverty is more prevalent in the new low-income (eastern) countries than in the old high-income (western) countries. But this is as much a political as an empirical issue.
    Date: 2012–01–31
  30. By: Vladimir Gligorov (The Vienna Institute for International Economic Studies, wiiw)
    Abstract: Economic outcomes before and after the break-up of YugoslaviaWhat are the costs of nationalistic policies? The expectations may be more optimistic than is warranted as the example of the breakup of Yugoslavia suggests. Assuming that nationalists expected that economic results would be better than in federal Yugoslavia, it makes sense to get some idea of what an alternative to a nationalistic strategy would have achieved in the last 20 years. The alternatives are nationalism vs. integration, not necessarily independence vs. federal Yugoslav state.That allows Slovenian development to be the basis for counterfactual simulations of where would have other Yugoslav states been had they followed its strategy of transition. This because (i) Slovenia opted for gradual transformation of the inherited Yugoslav institutions to those characteristic of the European Union (this is sometimes seen as a type of economic nationalism though in view of the next characteristic it is more of a gradualist strategy of transition) and that allows for an indirect evaluation of the Yugoslav institutions; (ii) chose to integrate with the EU and indeed the EMU, both as soon as possible, rather than pursue a protectionist, nationalistic strategy, which enables the comparison of these two strategies; and (iii) fared well, though not miraculously well, so its performance can be used as unbiased basis for comparative assessment of the price of nationalism.
    Keywords: Yugoslavia, EU, nationalism, fiscal integration, costs of break-up
    Date: 2011–07

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