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on Transition Economics |
| By: | Hartmut Lehmann; Maria Giulia Silvagni |
| Abstract: | This paper analyses convergence in per capita gross regional product of Russia’s regions during the period 1995-2010, when regional data are available. Using a panel regression framework we find no evidence for beta-convergence. Instead we find divergence, which is, however, attenuated over time. Robustness checks that use regional real income instead of gross regional product confirm this outcome as do non-parametric estimates of convergence, namely estimates using Markov transition probability matrices and stochastic kernel plots of regional relative income. Decompositions of regional income and gross regional product also find no sigma-convergence of Russian regions. These decompositions point to the geographical concentration of extractive activities in the Urals and of business services and of the public administration in the Moscow area as the main culprit for this lack of convergence. They also establish that despite reforms to equalize provisions of public goods across Russia, the social services sector of the public administration, education and health still do not have the expected equalizing impact on regional income.<P>Y a-t-il convergence entre régions de Russie ? : Exploration des preuves empiriques: 1995-2010<BR>Cet article analyse la convergence du produit régional brut per capita entre régions de Russie au cours de la période 1995-2010, lorsque les données régionales sont disponibles. En utilisant une régression de panel, nous ne trouvons aucune preuve de bêta-convergence. Nous trouvons au contraire une divergence qui s’atténue toutefois au fil du temps. Nous confirmons ces résultats avec deux tests de robustesse : un qui utilise le revenu régional réel au lieu du produit régional brut, un autre basé sur des estimations non paramétriques de convergence, à savoir des estimations des matrices de probabilité de transition de Markov et une représentation de kernel stochastiques du revenu régional relatif. Des décompositions du revenu régional et du produit régional brut ne montrent pas non plus de sigma-convergence entre régions russes. Ces décompositions soulignent la concentration géographique des activités extractives dans l'Oural et de services aux entreprises et de l'administration publique dans la région de Moscou comme les principaux responsables de ce manque de convergence. Elles établissent également que malgré les réformes pour égaliser les provisions de biens publics à travers la Russie, le secteur des services sociaux de l'administration publique, l'éducation et la santé n'ont toujours pas l'impact attendu sur l'égalisation des revenus régionaux. |
| Keywords: | convergence, Russian regions, regional inequality decomposition, regional distribution dynamics, convergence, régions russes, décomposition inter-régionale de l'inégalité, dynamique de distribution régionale |
| JEL: | O47 P25 R11 R12 |
| Date: | 2013–08–06 |
| URL: | http://d.repec.org/n?u=RePEc:oec:ecoaaa:1083-en&r=tra |
| By: | Sergio Schmukler (World Bank); Tatiana Didier (World Bank) |
| Abstract: | We study the extent to which firms from China and India use capital markets to obtain financing and grow. Using a unique data set on domestic and international capital raising activity and performance, we find that the expansion of financial market activity since the 1990s has been much more limited than the aggregate figures suggest. Relatively few firms raise capital and even fewer firms capture the bulk the financing. Moreover, firms that issue equity or bonds are different and behave differently from other publicly listed firms. Among other things, firms that raise capital are on average larger and grow faster. The differences between users and non-users exist before capital raisings, are associated with the probability of raising capital, and become more accentuated afterwards. The distribution of issuing firms shifts more over time than the distribution of those that do not issue, suggesting little convergence in firm size among listed firms. |
| Date: | 2013 |
| URL: | http://d.repec.org/n?u=RePEc:red:sed013:98&r=tra |
| By: | Bogetic, Zeljko; Olusi, Olasupo |
| Abstract: | This note presents the results of an empirical analysis of firm-level productivity growth in Russia's manufacturing sector during the period 2003-08 using a rich Amadeus database as well as the recent EBRD/World Bank Business Enterprise and Performance surveys (BEEPs). The results show that productivity grew steadily between 2003 and 2008, with an annual growth rate averaging 4 percent over the period, showing no signs of a slowdown from the previous period after the 1998 crisis. Firm characteristics such as size, location, age, and the structure of firm ownership are important determinants of productivity, as evidenced by positive effects of scale economies (large firm effect), agglomeration (Moscow-city effect), private ownership, and a firm's industry dominance. Supplemental analysis of the quality of infrastructure -- water, electricity, transport, and the internet -- using BEEPS data show that infrastructure quality gaps reduce firm productivity with water supply gaps having the largest impact. |
| Keywords: | Transport Economics Policy&Planning,E-Business,Economic Theory&Research,Microfinance,Municipal Financial Management |
| Date: | 2013–08–01 |
| URL: | http://d.repec.org/n?u=RePEc:wbk:wbrwps:6572&r=tra |
| By: | Alexander M. Danzer (Ludwig-Maximilians-Universität München); Barbara Dietz; Kseniia Gatskova; Achim Schmillen |
| Abstract: | This paper analyses incomes and socioeconomic status of internal migrants over time and in comparison to their new neighbors and investigates whether status consumption is a way for newly arrived city dwellers to signal their social standing. Using a novel dataset from the emerging economy of Kazakhstan we find that internal migrants earn an income and status premium for their move. In a comparison to indigenous city dwellers their earnings and household incomes are not significantly different; however, mobile households report a significantly higher subjective socio-economic status. Exploiting expenditure data, we find that recent migrant households gain status from using visible consumption to impress their new neighbors. This signaling might be used as adaptation to the new economic and social environment or to gain access to social capital. |
| Keywords: | Absolute and relative welfare, income, status consumption, conspicuous consumption, signaling model, adaptation, internal migration, rural-urban migration, emerging economy, Kazakhstan, socioeconomic status |
| JEL: | P36 I31 R2 |
| Date: | 2013–07 |
| URL: | http://d.repec.org/n?u=RePEc:ost:wpaper:330&r=tra |
| By: | Patricia McGrath |
| Abstract: | The three countries took different stances in regards to economic policy; the Czech Republic pursued a shock therapy regime which aimed to stabilise the economy, Hungary’s policy was more relaxed whilst Poland had an aggressive reform programme. Regarding monetary policy the Czech Republic used the discount rate as a tool for monetary policy, Hungary used indirect monetary policy and Poland had strict monetary policies which raised interest rates and devalued the zloty. After financial deregulation the impact of economic and monetary policy led to positive economic growth in the Czech Republic year on year. Hungary had a similar experience whilst Poland had an initial high increase in economic growth. This reduced over time but they still recorded positive economic growth over the period studied. |
| Keywords: | Transition Economies, Financial Deregulation, Economic Growth, Eastern Europe. |
| JEL: | E E2 E4 E5 G G15 G21 |
| Date: | 2013–05–15 |
| URL: | http://d.repec.org/n?u=RePEc:wdi:papers:2013-1049&r=tra |
| By: | Silgoner, Maria; Steiner, Katharina; Wörz, Julia; Schitter, Christian |
| Abstract: | We investigate the impact of China as a global competitor on the trade performance of the ten Central, Eastern and Southeastern European EU Member States (CESEE-10) in the EU-15 market. The paper takes a comprehensive approach as we analyze export growth, export market shares, extensive and intensive margins and the dynamics in the number of joint trade links (Dynamic Trade Link Analysis) from 1995 to 2010. According to our findings, the most contested markets are those for capital goods and transport equipment. Overall, competition between CESEE-10 and China intensified as a result of their outstanding competitiveness and the continuous deepening of already existing trade relationships, while cutthroat competition has not materialized. While this suggests that the CESEE countries pursue a suitable export strategy, diversification of production toward promising new industries and markets remains essential, not least because the EU-15 market is projected to grow at a slower pace in the longer run. JEL Classification: F14, F15, O57 |
| Keywords: | central, China, competitiveness, Eastern and Southeastern Europe, trade shift-share analysis |
| Date: | 2013–06 |
| URL: | http://d.repec.org/n?u=RePEc:ecb:ecbwps:20131559&r=tra |
| By: | Vasily Astrov (The Vienna Institute for International Economic Studies, wiiw); Rumen Dobrinsky (The Vienna Institute for International Economic Studies, wiiw); Vladimir Gligorov (The Vienna Institute for International Economic Studies, wiiw); Doris Hanzl-Weiss (The Vienna Institute for International Economic Studies, wiiw); Peter Havlik (The Vienna Institute for International Economic Studies, wiiw); Mario Holzner (The Vienna Institute for International Economic Studies, wiiw); Gabor Hunya (The Vienna Institute for International Economic Studies, wiiw); Michael Landesmann (The Vienna Institute for International Economic Studies, wiiw); Sebastian Leitner (The Vienna Institute for International Economic Studies, wiiw); Olga Pindyuk (The Vienna Institute for International Economic Studies, wiiw); Leon Podkaminer (The Vienna Institute for International Economic Studies, wiiw); Sandor Richter (The Vienna Institute for International Economic Studies, wiiw); Hermine Vidovic (The Vienna Institute for International Economic Studies, wiiw) |
| Abstract: | Summary The protracted recession in the euro area will continue to be a drag on the economic growth of most CESEE countries in 2013. By and large, those countries are small open economies held hostage to the excessive fiscal austerity pursued in the euro area and the sluggish progress on the part of its policy-makers in adequately addressing the structural roots of the crisis. At the same time, the private sector demand in the CESEE countries is unlikely to recover substantially in the near term either. Wherever there will be an increase in investments, it will be primarily funded via public money, with EU transfers playing an increasingly important role. In general, the prospects for 2013 are only marginally better than the previous year; any significant improvement will be unlikely before 2014 – in line with the projected recovery in the euro area. These are the main results of the newly released medium-term growth forecast for the region by the Vienna Institute for International Economic Studies (wiiw). Weak exports and suppressed domestic demand pushed nearly half of the Central, East and Southeast European (CESEE) economies into recession in 2012, including the Czech Republic, Hungary, Slovenia and nearly all Western Balkan countries. Elsewhere in the region, growth remained positive but was generally unspectacular, with the notable exceptions of Kazakhstan and Latvia. Also in countries that hitherto had been relatively immune to the euro area crisis (such as Russia, Poland, Ukraine and Turkey), growth dynamics progressively decelerated in the second half of the year. On the whole, 2012 was a disappointing year for the CESEE economies, confirming fears of a double-dip recession in the euro area adversely impacting large parts of the CESEE region. This rather poor performance stands in sharp contrast to the better dynamics in other ‘emerging markets’ in Asia and Latin America, and underscores the dependence of large parts of the CESEE region on the troubled euro area (not least in terms of policies pursued) and the structural weakness of many CESEE economies. The crucial factor behind the disappointing CESEE growth performance has been the weakness of domestic demand. Import demand generally lagged behind export growth, and net exports contributed positively to GDP growth in 2012 – despite the anaemic external environment. High unemploymentand stagnant wages, coupled with fiscal austerity and the ongoing (albeit in some cases decelerating) household deleveraging, continue to weigh heavily on the dynamics of private consumption in most CESEE countries, with the exception of Russia, Ukraine, Kazakhstan and the Baltic states. In turn, investment activity is suppressed by the lasting, and in some cases even deteriorating, perception of uncertain future prospects and by underutilized capacities in an environment characterized by weak demand – even though large parts of the corporate sector are awash with liquidity. In these circumstances, the investment dynamics in the region has been shaped by public investment projects, frequently supported by EU transfers (first of all in Estonia and Romania). The expected marginal improvement in economic performance in some CESEE countries in 2013 is largely due to the somewhat less restrictive fiscal policy (e.g. the Czech Republic) or a better performance of agriculture (Serbia, Romania). However, in Poland and Slovakia economic growth will decelerate, while Slovenia and Croatia will be unable to avoid another recession this year – notwithstanding the likely beneficial impact of inflows of EU funds in the latter case. The near-term economic prospects are generally better on the ‘fringes’ of the CESEE region the Baltic states, Russia, Kazakhstan and Turkey, which are less dependent on the troubled euro area and are in no rush (or need) to pursue fiscal consolidation. In Ukraine, economic prospects are dependent on a timely and ‘controlled’ currency devaluation, which would be crucial for the badly needed growth re-balancing. Even under the most optimistic scenario, in the medium and long term the CESEE countries will be generally unable to replicate the growth rates observed prior to the 2008-2009 crisis. In the Western Balkans, the bleak growth prospects and the high levels of unemployment may eventually imperil the fragile social and political stability of these countries. The newly released wiiw Forecast Report also contains ‘special topics’ dealing in-depth with (1) regional and EU-wide fiscal policy issues, (2) the extent of deleveraging in the household, corporate and banking sectors, and (3) the patterns of structural adjustment and unit labour cost developments in the CESEE countries. Last but not least, it includes for the first time a country report and statistical information on Kosovo. |
| Keywords: | Central and East European new EU member states, Southeast Europe, financial crisis, Balkans, Russia, Ukraine, Kazakhstan, Turkey, economic forecasts, employment, for- eign trade, competitiveness, debt, deleveraging, exchange rates, fiscal consolidation |
| JEL: | C33 C50 E20 E29 F34 G01 G18 O52 O57 P24 P27 P33 P52 |
| Date: | 2013–03 |
| URL: | http://d.repec.org/n?u=RePEc:wii:fpaper:fc:11&r=tra |
| By: | Vasily Astrov (The Vienna Institute for International Economic Studies, wiiw); Mario Holzner (The Vienna Institute for International Economic Studies, wiiw) |
| Abstract: | (Reprint from WIFO-Monatsberichte, Vol. 86, No. 5, May 2013) Zusammenfassung 2012 entwickelte sich die Wirtschaft in den Ländern Mittel-, Ost- und Südosteuropas insgesamt enttäuschend. Aufgrund der Stagnation der Exporte und der gedämpften Binnennachfrage gerieten acht Länder der Region in die Rezession (Tschechien, Ungarn, Slowenien und die meisten Westbalkanländer). In den anderen Ländern wuchs das BIP zwar, aber allgemein nur schwach. Auch in Ländern, deren Wirtschaft bisher von der Krise im Euro-Raum nicht betroffen gewesen war (z. B. Russland, Polen, Ukraine, Türkei), verlangsamte sich die Wachstumsdynamik in den letzten Monaten immer mehr. English Summary Central, East and Southeast Europe Caught by the EU Crisis On the whole, 2012 was a disappointing year for the economies of Central, East and Southeast Europe (CESEE), confirming fears of a double-dip recession in the euro area adversely impacting large parts of the CESEE region. This rather poor performance stands in sharp contrast to the better dynamics in other emerging markets in Asia and Latin America, and underscores the dependence of large parts of the CESEE region on the troubled euro area – not least in terms of policies pursued. Weak exports and suppressed domestic demand pushed nearly half of the CESEE economies into recession in 2012, including the Czech Republic, Hungary, Slovenia and nearly all Western Balkan countries. Elsewhere in the region, growth continued but was generally unspectacular. Also in countries that hitherto had been relatively immune to the euro area crisis (such as Russia, Poland, Ukraine and Turkey), growth dynamics has been progressively decelerating since the second half of 2012. The weakness of domestic demand in most CESEE countries is partly attributed to the anaemic credit dynamics, as western banks, which dominate the banking sector of most CESEE countries, are reducing their local exposure, not least in order to comply with the stricter Basel III capital adequacy requirements. In addition, the newly adopted EU fiscal pact is forcing many CESEE governments to pursue budget consolidations. High unemployment and stagnant wages, coupled with fiscal austerity and the ongoing household deleveraging, continue to weigh heavily on the dynamics of private consumption in most CESEE countries. In turn, investment activity is suppressed by the lasting perception of uncertain future prospects and underutilised capacities in an environment characterised by weak demand. This year, economic growth in the CESEE countries is likely to pick up slightly – largely on account of somewhat less restrictive fiscal policies in some countries (Poland, Czech Republic) and a better performance of agriculture in others (Serbia, Romania), although Slovenia and Croatia will still be unable to avoid another recession. The near-term economic prospects are generally better in the eastern part of the CESEE region, which is less dependent on the troubled euro area and is in no rush (or need) to pursue fiscal consolidation. Even under the most optimistic scenario, in the medium and long term the CESEE countries will be generally unable to replicate the growth rates observed prior to the 2008-09 crisis. |
| Keywords: | transitional economies, comparative study, economic growth, fiscal and monetary policy, macroeconomic forecast, macroeconomic analysis |
| JEL: | P2 O57 E17 O4 |
| Date: | 2013–06 |
| URL: | http://d.repec.org/n?u=RePEc:wii:ratpap:rpg:2013-06&r=tra |
| By: | Gabor Hunya (The Vienna Institute for International Economic Studies, wiiw); Monika Schwarzhappel (The Vienna Institute for International Economic Studies, wiiw) |
| Abstract: | Content The first part of the publication contains an analysis of the latest FDI trends. The analysis highlights the modest recovery of FDI in 2012. The second part of the publication contains two sets of tables Tables I total flow and stock data, FDI flow by components and FDI income, FDI per capita and other FDI reference parameter (2004-2012) Tables II detailed FDI data by economic activity and by country (last four years) The main sources of data are the central banks of the individual Central, East and Southeast European countries. General Description General Description (PDF) Abstract The first part of this report provides an analysis of the 2012 FDI trends in 22 CESEE countries, pointing to a modest recovery. The strongest growth in inflows in 2012 was observed in the NMS (+35%) following a year with extremely low inflows. But the exceptionally high FDI inflow in the Czech Republic and Hungary was mainly the result of capital in transit and financial flows not resulting in fixed investments. The decline in the SEE countries was 22% following a relatively successful year and caused by a one-time capital withdrawal from Serbia. Inflows to the CIS remained flat (+1%) and were strongly biased upwards by round-tripping Russian capital. FDI inflows declined in twelve CESEE countries, in line with the generally depressed business sentiment and unimpressive economic growth. The latter is even more reflected in the low number of greenfield investment projects and in their small size. Forecasts for economic growth in 2013 and first quarter trends in FDI flows and greenfield projects suggest a serious setback of FDI in most CESEE countries, with the possible exceptions of Poland, Slovenia and Kazakhstan. As another main cause, it is expected that Russian companies will be more reluctant and also restricted to use Cyprus as a stepping stone for investments at home thus both the outflow and inflow of Russian FDI is expected to diminish. The second part of this report contains two sets of tables Tables I cover FDI flow and stock data, FDI flows by components and related income; Tables II provide detailed FDI data by economic activity and country. The main sources of data are the central banks of the individual Central, East and Southeast European countries. The wiiw FDI Report is the new title of the former publication ‘wiiw Database on Foreign Direct Investment in Central, East and Southeast Europe’. The printed report and the analysis therein is based upon the wiiw FDI Database which will be available online from July 2013. Examples Table of contents (PDF) NEW SERVICE The wiiw FDI Database is available online from July 2013 This new online access with a modern query tool supports easy search and download of data. The wiiw FDI Database contains the full set of FDI data with time series starting form 1990 as far as available. Access to wiiw FDI Database |
| Keywords: | foreign direct investment, balance of payments, income repatriation, statistics, new EU Member States, Southeast Europe, CIS |
| JEL: | C82 F21 O57 P23 |
| Date: | 2013–05 |
| URL: | http://d.repec.org/n?u=RePEc:wii:fdirep:fdi:2013-05&r=tra |
| By: | Vasily Astrov (The Vienna Institute for International Economic Studies, wiiw); Rumen Dobrinsky (The Vienna Institute for International Economic Studies, wiiw); Vladimir Gligorov (The Vienna Institute for International Economic Studies, wiiw); Doris Hanzl-Weiss (The Vienna Institute for International Economic Studies, wiiw); Peter Havlik (The Vienna Institute for International Economic Studies, wiiw); Mario Holzner (The Vienna Institute for International Economic Studies, wiiw); Gabor Hunya (The Vienna Institute for International Economic Studies, wiiw); Michael Landesmann (The Vienna Institute for International Economic Studies, wiiw); Sebastian Leitner (The Vienna Institute for International Economic Studies, wiiw); Olga Pindyuk (The Vienna Institute for International Economic Studies, wiiw); Leon Podkaminer (The Vienna Institute for International Economic Studies, wiiw); Sandor Richter (The Vienna Institute for International Economic Studies, wiiw); Hermine Vidovic (The Vienna Institute for International Economic Studies, wiiw) |
| Abstract: | Summary Continued weak external demand and uncertain recovery of investments will allow for only modest growth prospects for the countries of Central, East and Southeast Europe (CESEE) this year. Slovenia, Croatia and the Czech Republic will remain in recession. Russia, Ukraine and the Baltic countries will experience a slowdown of growth. Over the next two years, growth will speed up, but will remain below potential for most CESEE countries except Kazakhstan and likely Turkey. The emerging institutional and policy framework in the EU that reflects unresolved dilemmas about the process of deepening may put in question the model of convergence growth. Widening of the EU is, in contrast, proceeding with Croatia acceding and the intention to start negotiations with Serbia being announced. However, given the worsening labour markets, social and political risks may be on the rise. These are the main results of the newly released medium-term growth forecast for the region by the Vienna Institute for International Economic Studies (wiiw). wiiw expects slow recovery this year within a mostly restrictive policy framework. Some acceleration, due in part to an improved external environment for EU and CESEE economies and in part to growth of investments, is forecast for the medium term. However, the set of better performers has shrunk, with Poland’s and Slovakia’s performance coming more in line with the growing number of slowly recovering economies. Recovery is slowing down in the Baltic region. There are still some countries that are struggling with recession, such as Slovenia and Croatia and also the Czech Republic within the CESEE group. Stability issues are also still being faced in a number of Balkan countries, e.g. Serbia, Montenegro, and Bosnia and Herzegovina; by contrast, Albania and Kosovo are managing to stay out of recession and on a relatively elevated growth path. Russia and Ukraine are seeing either a slowdown of growth or prospects for stagnation and slow recovery, while positive news keep coming from Kazakhstan and faster growth resuming in Turkey. By and large, Central European countries are relying on a positive contribution from net exports and investments, the Balkan countries on recovery of industrial production and exports, Russia and Ukraine, and perhaps also Turkey, rely on a continued positive contribution of household consumption, and Kazakhstan on receipts from sales of oil and gas. None of these factors is particularly strong – hence weak GDP growth expectations prevail. Last but not least, the contribution of public consumption and investments tends to be rather limited throughout the whole of Europe. Monetary policy has been stabilising due to the assertive communication rather than action by the European Central Bank (ECB) and due to mostly relaxing actions by the other central banks in CESEE. However, these have affected recovery to a lesser extent because of the continuing process of consolidation in the financial sector. While sovereigns have seen a decline in the spreads of their yields, a similar calming down of interest rates in the private sector has been insufficient to support stronger credit activity, especially when it comes to small and medium-sized enterprises. This can be expected to continue to be a drag on growth of investments and thus also on overall GDP growth. Within the institutional and policy framework geared towards elimination of external and internal macroeconomic imbalances, the bulk of the structural adjustment is happening in the labour markets. Employment rates have declined in most countries while unemployment in particular among the youth and the long-term unemployed is on the rise. This is particularly damaging in the Balkans where the labour markets have been in depression even before the eruption of the crisis. There are few if any indications of a turnaround in the labour markets in the medium term. The strengthened emphasis on the correction of imbalances, reflected in the Macroeconomic Imbalance Procedure of the EU, may turn out to be harmful for the countries benefiting from EU transfers due to increased stress on using these funds as a disciplining device. In addition to fiscal imbalances, which should prove less of a problem to many CESEE countries, the correction of external and labour market imbalances may turn out to be more difficult to address. Moreover, balanced growth, implying less reliance on cross-border financing, may be a problem for countries that cannot move to a new growth model by mobilising more domestic savings. The processes of deepening and widening of the EU are proceeding, with deepening being more at a project- and institution-building stage while widening is getting a new boost by the accession of Croatia and by the start of accession negotiations with Serbia early next year. Croatia’s accession to the common market also means its departure from the regional free trade area, the CEFTA. Estimates of trade and welfare effects point to relatively mild overall negative consequences for Croatia in the short run. Those should be outweighed by more general positive effects of EU membership in the medium and long run. In a nutshell the CESEE region faces a slow recovery in the short and medium term with unclear prospects for long-run growth and economic convergence. |
| Keywords: | Central and East European new EU member states, Southeast Europe, financial crisis, Balkans, Russia, Ukraine, Kazakhstan, Turkey, economic forecasts, employment, foreign trade, competitiveness, debt, deleveraging, exchange rates, fiscal consolidation |
| JEL: | C33 C50 E20 E29 F34 G01 G18 O52 O57 P24 P27 P33 P52 |
| Date: | 2013–07 |
| URL: | http://d.repec.org/n?u=RePEc:wii:fpaper:fc:12&r=tra |
| By: | Rod Tyers |
| Abstract: | Export led growth has been very effective in modernising China’s economy and establishing a large high-saving middle class. Notwithstanding political opposition from trading partners, this growth strategy has also offered the rest of the world improved terms of trade in both product and financial markets, in the form of cheaper light manufactures and cheaper credit. Yet slowing demand in export destinations has forced a transition to inward-sourced growth. This paper uses a numerical model of the Chinese economy with oligopoly behaviour to examine the available “inward†sources of transformative growth along with the policies needed to exploit them. The potential for considerable further “transformative†growth is shown to be considerable though it will require accelerated skilled labour supply growth and the politically difficult extension of industry policy reform to heavy manufacturing and services. |
| Keywords: | China, growth, fiscal policy, oligopoly, price caps, privatisation |
| JEL: | D43 D58 E62 L13 L43 |
| Date: | 2013–08 |
| URL: | http://d.repec.org/n?u=RePEc:een:camaaa:2013-48&r=tra |
| By: | Rustam Jamilov; Balázs Égert |
| Abstract: | This paper analyses the interest rate pass-through for five economies of the Caucasus – Armenia, Azerbaijan, Georgia, Kazakhstan, and Russia. Employing an autoregressive distributed lag (ARDL) specification to monthly data, we find that the interest rate pass-through is systematically incomplete and sluggish, probably due to macroeconomic instability and low banking sector competition. It is not clear whether pass-through has improved over time and asymmetric adjustment is found to characterize the pass-through only occasionally. Overall, our results show a considerable degree of cross-country heterogeneity in the size and speed of the pass-through. |
| Keywords: | Interest Rate Pass-Through; Asymmetric Adjustment; Caucasus |
| JEL: | E43 E52 N25 |
| Date: | 2013–01–02 |
| URL: | http://d.repec.org/n?u=RePEc:wdi:papers:2013-1041&r=tra |
| By: | Antošová, Veronika; Stávková, Jana; Birčiaková, Naďa |
| Abstract: | The paper deals with the relation between the income situation of households in the Czech Republic and economic growth. The monitoring covers a period of 2005–2010, i.e. a period of a relatively high economic growth and a beginning economic crisis. The period has been chosen based on the available dataset from a survey of the income situation of households and their living conditions - project EU-SILC (European Union Statistics on Income and Living Conditions) - using a unified EU methodology. The income situation of inhabitants has been evaluated from the perspectives of its level and its differentiation. The used indicators were the mean disposable income per a household member, a decile distribution of income, the Gini coefficient for the measurement of income disparities, the poverty threshold and the depth of poverty. The results show that in the years of economic growth, i.e. 2005, 2006, and 2007, indicators of income situation displayed a positive trend – the mean disposable income per a household member increased including the median income situation, the number of households at risk of poverty decreased – in 2008 the proportion of Czech households at risk of poverty achieved the lowest percentage of all EU countries, i.e. 5.56%. The beginning economic recession in 2008 can be observed in the values of macroeconomic indicators. The changes in the income situation of households started to be more markedly manifested as late as in 2010, besides the decrease in the final consumption of households, there was a change in the interannual growth of the mean income of households and an increase in the number of households at risk of poverty. The conclusions prove an up to two-year delay of the impacts of the economic development of the society on the living conditions of households. |
| Keywords: | income situation of households, income disparities, economic development, EU-SILC, risk of poverty |
| JEL: | I3 I32 O10 |
| Date: | 2013–04–01 |
| URL: | http://d.repec.org/n?u=RePEc:pra:mprapa:48778&r=tra |
| By: | Petr Jansky (Institute for Fiscal Studies and Charles University) |
| Abstract: | Reforms of indirect taxes, such as the recent changes in rates of value added tax (VAT) in the Czech Republic, change prices of products and services to which households can respond by adjusting their expenditures. I estimate the behavioural response of consumers to price changes in the Czech Republic applying a consumer demand model of the quadratic almost ideal system (QUAIDS) form to the Czech Statistical Office data for the period from 2001 to 2011. I then derive the estimates of own- and cross-price and income elasticities and I use these to estimate the impact of changes in VAT rates, which were proposed or implemented between 2011 and 2013, on households and government revenues. I further find that this method, which allows for behavioural response, yields lower estimates of changes in VAT revenues than when I use the standard static simulation. These relatively small, but statistically significant differences might partly explain the past cases, and might lead to future cases, of the over-estimation of VAT revenues by the Ministry of Finance of the Czech Republic. |
| Keywords: | consumer behaviour, demand system, QUAIDS, value added tax, Czech Republic |
| JEL: | D12 H20 H31 |
| Date: | 2013–08 |
| URL: | http://d.repec.org/n?u=RePEc:ifs:ifsewp:13/20&r=tra |
| By: | Jan Prusa; Andrea Klimesova; Karel Janda |
| Abstract: | This article provides a financial survey of a small sample of Czech photovoltaic (PV) plants. To evaluate the extent of market losses, we calculate the shadow market price of solar electricity. From the profit and loss accounts of the PV plants and the shadow market price we estimate the total economic loss generated by PV electricity sector in the Czech Republic. The presented microeconomic approach has two main advantages: Firstly, we work with real observed data, which offsets the drawback of a limited sample. Secondly, the profit accounting calculation enables sensitivity analysis with respect to key variables of the plants. We show that money invested in PV plants would generate an annual loss of 8%. Given the estimated solar assets of CZK 165.6 billion (EUR 6.6 billion) as of December 2011, this translates in at least CZK 12.6 billion lost in the Czech solar sector in 2012. About 43% of this loss is due to high technology costs and corresponds to pure dead weight loss, while the remaining 57% constitute the redistributive profit component of subsidies. Finally, we calculate that unless electricity prices increase or technology costs decrease approximately sevenfold, PV plants will remain loss making. |
| Keywords: | energy subsidies; photovoltaic; renewables |
| JEL: | Q42 H23 M21 |
| Date: | 2013–08 |
| URL: | http://d.repec.org/n?u=RePEc:een:camaaa:2013-50&r=tra |
| By: | Macchiarelli, Corrado |
| Abstract: | In this paper we look at business cycles similarities between CEE countries and the euro area. Particularly, we uncover GDP-inflation cycles by adopting a trend-cycle decomposition model which allows the trend to be either stochastic or deterministic i.e. of the non-linear type. Once cyclical components are derived, we test for ex post restrictions at both with-in (GDP-to-inflation) and cross-country (CEECs vs. euro area) levels. Allowing for different degrees of cyclical similarity, we find that a similar inflation vs. GDP cycle is not rejected only for Poland, Lithuania, Romania and Estonia (with Latvia and the euro area being at the boundary). Looking at cross-country results, almost all countries feature a fair degree of similarity with respect to the euro area. Exceptions are Poland, Hungary, Latvia and Slovenia because of lack of a similar cycle either occurring in GDP or inflation, yet not in both. Finally, observing how concurrence between each CEECs cycle and the euro area evolved over time, we find that inflation conditional correlation increased stemming from the EU accession of most CEECs and as a result of the commodity price shock preceding 2008. Further, inflation and GDP conditional correlations receded during the course of 2009-2010, possibly resulting from more idiosyncratic adjustments in the aftermath of the crisis on the monetary/fiscal side. Interestingly, Slovenia, Slovakia, Estonia and Bulgaria display a conditional correlation pattern in GDP and inflation which roughly suggest a strong out-of-phase recovery starting from 2005. JEL Classification: C51, E31, E32, F43, F44 |
| Keywords: | business cycle, CEECs, convergence, euro area, Inflation-GDP gaps |
| Date: | 2013–06 |
| URL: | http://d.repec.org/n?u=RePEc:ecb:ecbwps:20131552&r=tra |
| By: | Kundt, Thorben C.; Misch, Florian; Nerré, Birger |
| Abstract: | This paper addresses the major weakness of measuring tax evasion through business and household surveys, namely the reluctance of respondents to answer truthfully due to the threat of disclosure. First, we assess the merits of a novel questioning method to gather information about tax evasion by means of business surveys. This approach allows estimating the prevalence of tax evasion, but it does not allow identifying whether the individual firm engages in tax evasion or not, therefore providing incentives for survey participants to answer truthfully. Second and contrary to most other business surveys, we differentiate between two common modes of tax evasion, namely underreporting of sales and informal supplements to official wages ('envelope wages'). Using evidence from Serbia, we show that the estimated share of firms which underreport sales and wages, respectively, by at least 10% is higher under the crosswise model compared to the case when conventional questioning methods applied in business surveys such as the World Bank Enterprise Surveys are used. However, the difference is only significant with respect to sales. These results appear to be robust to a number of modifications, and we explore various potential causes that lead to these results. -- |
| Keywords: | tax evasion,shadow economy,measurement,developing countries |
| JEL: | H20 E62 |
| Date: | 2013 |
| URL: | http://d.repec.org/n?u=RePEc:zbw:zewdip:13047&r=tra |
| By: | Wojciech Grabowski; Krzysztof Szczygielski; M. Teoman Pamukçu; Sinan Tandogan |
| Abstract: | Mediterranean and EU member countries consider enhancing innovation and R&D an important policy objective. In order to improve economic competitiveness and increase their citizens’ welfare, these countries have been formulating and implementing innovation policies. In recent years, the volume of resources allocated to such policies has considerably increased and the number of instruments used in this framework has widened. Nevertheless, a relatively limited number of studies have been conducted to assess the effectiveness of innovation policies in these countries and formulate proposals for those aspects of policies that are in contradiction with the aims.Creation-Date: 2012-09 |
| Keywords: | Private Innovation |
| URL: | http://d.repec.org/n?u=RePEc:sec:ebrief:0113&r=tra |