nep-tra New Economics Papers
on Transition Economics
Issue of 2013‒09‒24
twenty-six papers chosen by
J. David Brown
IZA (Institute for the Study of Labor)

  1. Costly Labor Adjustment: General Equilibrium Effects of China's Employment Regulations By Russell Cooper; Guan Gong; Ping Yan
  2. CEO Incentives in Chinese State-Controlled Firms By Johansson, Anders C.; Feng, Xunan
  3. Russia’s State Budget in 2012 By Sergey Belev; Tatiana Tischenko; Ilya Sokolov
  4. Russian Agriculture and Agricultural Policies in 2012 By Natalia Karlova; Natalia Shagaida; Vasily Uzun; Renata Yanbykh
  5. Features of the Public Procurements of Innovation Products in Russian and the World By Sergey Belev; Olga Boldareva; Ilya Sokolov; Anna Zolotareva
  6. China's new energy vehicles: value and innovation By Chris Kimble; Hua Wang
  7. Individual Decisions or Institutional Dynamics? Reasons for the Intensive Use of Fertilizer in Eastern China By Berger, Lars; Huettel, Silke; Hagedorn, Konrad
  8. The Nature of Innovation Channels at the Micro-Level: Evidence from Russian Manufacturing Firms By Simachev, Yuri; Kuzyk, Mikhail; Feygina, Vera
  9. Banking and the Macroeconomy in China: A Banking Crisis Deferred? By Le, Vo Phuong Mai; Matthews, Kent; Meenagh, David; Minford, Patrick; Xiao, Zhiguo
  10. Behavioral Biases and Corporate Decision Making on Investing Abroad By Kotov, Denis
  11. How Effective are Macroprudential Policies in China? By Bin Wang; Tao Sun
  12. Development policies and income inequality in selected developing regions, 1980-2010 By Giovanni Andrea Cornia; Bruno Martorano
  13. Local Entrepreneurship in Vietnam’s Rural Transformation. A Case Study from the Mekong Delta By Benedikter, Simon; Waibel, Gabi; Birtel, Serge; Bui, Cuong The; Tran, Be Thanh
  14. Costs and Benefits of Labour Mobility between the EU and the Eastern Partnership Partner Countries. Country report: Belarus By Alexander Chubrik; Alaksei Kazlou
  15. Migration and Agricultural Efficiency - Empirical Evidence for Kosovo By Sauer, Johannes; Gorton, Matthew; Davidova, Sophia
  16. Labour Migration from the Eastern Partnership Countries: Evolution and Policy Options for Better Outcomes By Luca Barbone; Mikhail Bonch-Osmolovskiyi; Matthias Luecke
  17. North Caucasus in 2012: Results and Risks By Irina Starodubrovskaya
  18. Bank Funding in Central, Eastern and South Eastern Europe Post Lehman: a “New Normal� By Gregorio Impavido; Heinz Rudolph; Luigi Ruggerone
  19. The Sources of Growth in the Former SFRY Countries: Comparative Analysis By Popovic, Milenko; Cizmovic, Mirjana
  20. Measuring the Informal Economy in the Caucasus and Central Asia By Yasser Abdih; Leandro Medina
  21. Migration Patterns of Serbian and Bosnia and Herzegovina Migrants in Austria: Causes and Consequences By Michael Landesmann; Isilda Mara; Hermine Vidovic
  22. Legal principles of managing agricultural lands in Poland and their impact on changes in the agrarian structure By Suchon, Aneta Anna
  23. Institutions, the resource curse and the transition economies: further evidence By Marta Spreafico
  24. Private Property Rights and Pollution in Emerging Market Economies By Yang, Zhenzeng
  25. External factors affecting investment decisions of companies By Bialowolski, Piotr; Weziak-Bialowolska, Dorota
  26. Structural or Cyclical? Unemployment in Latvia Since the 2008-09 Financial Crisis By Anosova, Daria; Sonin, Konstantin; Vanags, Alf; Zasova, Anna

  1. By: Russell Cooper; Guan Gong; Ping Yan
    Abstract: This paper studies the employment and productivity implications of new labor regulations in China. These new policies were intended to protect workers' employment conditions by, among other things, increasing firing costs and increasing compensation. We estimate a model of costly labor adjustment from data prior to the policy. We use the estimated model to simulate the effects of the policy. We find that increases in severance payments lead to sizable job creation, a significant reduction in labor reallocation and an increase in the exit rate. A policy of credit market liberalization will reduce employment, increase labor reallocation and increase wages. The estimated elasticity of labor demand implies that an increase in the base wage leads to sizable job losses.
    JEL: E24 J08 J2
    Date: 2013–08
  2. By: Johansson, Anders C. (Stockholm China Economic Research Institute); Feng, Xunan (Shanghai University)
    Abstract: This paper investigates CEO incentives in Chinese state-controlled firms. We find that firm performance has a positive effect on CEO compensation. We also find that firm performance is positively associated with CEO promotion and negatively associated with CEO turnover. CEOs for state-controlled firms thus face significant incentives, not only in monetary form, but also in terms of career prospects. These results suggest that the CEO labor market in the Chinese state sector exhibits characteristics similar to those of managerial labor markets in developed countries, at least during our sample period. Moreover, we show that local institutions have a significant impact on the relationship between CEO incentives and firm performance, with performance having a larger effect on CEO compensation, promotion and turnover in regions characterized by stronger institutions. Overall, our results demonstrate that firm performance is associated with CEO incentives also for state-controlled firms in China, suggesting that there is a functioning labor market for top managers in the Chinese state sector.
    Keywords: State-controlled firms; Managerial labor market; Performance; CEO compensation; CEO promotion; CEO turnover; China
    JEL: G30 G38 J30 M52 P30
    Date: 2013–09–06
  3. By: Sergey Belev (Gaidar Institute for Economic Policy); Tatiana Tischenko (Gaidar Institute for Economic Policy); Ilya Sokolov (Gaidar Institute for Economic Policy)
    Abstract: This paper deals with 2012 Russia's state budget. Authors speak about general characteristics of the budget system in Russia. They analyse revenues from major taxes and main parameters of the federal budget in 2012 and for 2012-2014, explain budget expenditures and give prospects of the budgetary and tax policy in Russia..
    Keywords: Russian economy, state budget, tax revenues, budget system, fiscal policy
    JEL: E62 H20 H50 H61 H70
    Date: 2013
  4. By: Natalia Karlova (Gaidar Institute for Economic Policy); Natalia Shagaida (Gaidar Institute for Economic Policy); Vasily Uzun (Gaidar Institute for Economic Policy); Renata Yanbykh (Gaidar Institute for Economic Policy)
    Abstract: At present about 4% of Russia’s GDP is generated in agriculture; however, the sector still accounts for 9.7% of the total number of employed in domestic economy with 26% of the country’s population living in rural areas. The latter indicator has remained actually unchanged throughout the 10 recent years.
    Keywords: Russian economy, agriculture, food market, agricultural policy, Russia's accession to WTO
    JEL: Q13 Q14 Q15 Q16 Q17 Q18
    Date: 2013
  5. By: Sergey Belev (Gaidar Institute for Economic Policy); Olga Boldareva (Gaidar Institute for Economic Policy); Ilya Sokolov (Gaidar Institute for Economic Policy); Anna Zolotareva (Gaidar Institute for Economic Policy)
    Abstract: This paper presents an in-depth analysis of the legal basis and the elements of the institutional environment of public procurements of innovations produce in Russia and the world. Authors analyze procurement procedures for complex and hi-tech products. They determine ways for the development of Russian procurement legislation regarding procurement of innovation products.
    Keywords: Russian economy, public procurement, innovations, innovation products
    JEL: H57 H44
    Date: 2013
  6. By: Chris Kimble (MRM - Montpellier Recherche en Management - Université Montpellier II - Sciences et techniques : EA4557 - Université Montpellier I - Université Paul Valéry - Montpellier III - Groupe Sup de Co Montpellier (GSCM) - Montpellier Business School, Euromed Marseille - École de management - Association Euromed Management - Marseille); Hua Wang (Euromed Marseille - École de management - Association Euromed Management - Marseille)
    Abstract: Purpose The overarching theme is the importance of innovations that are created within the emerging economies. More specifically, the article looks at the development of various alternatives to vehicles powered by the internal combustion engine, new energy vehicles (NEVs) within China. Design/methodology/approach The broad strategic approach of two sectors within the NEV sector in China, the pure electric vehicle (EV) and the low-speed electric vehicle (LSEV) sectors, are compared using recent data and conclusions are drawn. Findings The EV sector is viewed by the central government as a key sector for China's future industrial growth and is heavily supported. In contrast, the LSEV sector receives no support from central government and yet clearly outstrips the sales of EVs. The article argues that the latter's success is a reflection of the LSEV sector's focus on business model rather than technological innovation. Practical implications The article highlights the importance of monitoring innovations that come from within emerging economies and also illustrates the benefits that can come from commercially focused innovations rather than those based on technology. Social implications Finding alternatives to vehicles powered by fossil fuels is one of the most important challenges facing the world today. This article looks at the search for one alternative and examines its implications. What is original/of value? The article examines a business sector that is peculiarly Chinese and yet has potential implications far beyond China. It also contains recent sales figures and other data collected directly from sources in China.
    Keywords: Business models; China; Electric vehicles; Emergent strategy; Emerging economies; Innovation; Innovation; New energy vehicles
    Date: 2013–08–01
  7. By: Berger, Lars; Huettel, Silke; Hagedorn, Konrad
    Abstract: The eutrophication of Lake Tai in the mid-east of China caused by an excessive import of nutrients from agricultural non-point-source pollution impedes social and economic development. In our research we aim to improve the understanding of the farmers’ decision-making process applying chemical fertilizers. Based on data gained in household interviews in 2011 and 2012 we follow the question: Which factors influence the individual decision on the use of fertilizers? Our approach is twofold: first, we estimate a production function to assess nitrogen overuse. Second, based on qualitative data we analyse the influence of the institutional context on individual decision-making.
    Keywords: non-point source pollution, farm-level decision-making, institutional analysis, China, Environmental Economics and Policy, Institutional and Behavioral Economics, Resource /Energy Economics and Policy,
    Date: 2013
  8. By: Simachev, Yuri; Kuzyk, Mikhail; Feygina, Vera
    Abstract: The main purpose of the paper is to analyze different channels for innovations. We analyze the influence of various incentives for innovation in Russian companies taking into account the organization of industries — vertical or horizontal orientation, peculiarities of corporate demography, role and motives of different owners (including government and foreign investors), demand trends, customers‘ profile, nature and intensity of competition in relevant markets. An empirical base for our study is provided by two surveys of Russian industrial companies conducted in 2011 and 2012. One of our hypotheses: in vertically organized sectors that define innovation activeness in the economy (for example, mechanical engineering), the innovative development of the head producers is constrained by the risk of technological gap with its partners in the supply chain. We find out that innovations in Russian industry spread in accordance with two main models: vertical through corporate connections, and horizontal, based on the example of foreign companies in the atmosphere of developed competition.
    Keywords: innovation, industrial organization, supply chain, innovation channels
    JEL: D22 L2 O31
    Date: 2013–07–30
  9. By: Le, Vo Phuong Mai; Matthews, Kent; Meenagh, David; Minford, Patrick; Xiao, Zhiguo
    Abstract: The downturn in the world economy following the global banking crisis has left the Chinese economy relatively unscathed. This paper develops a model of the Chinese economy using a DSGE framework with a banking sector to shed light on this episode. It differs from other applications in the use of indirect inference procedure to test the fitted model. The model finds that the main shocks hitting China in the crisis were international and that domestic banking shocks were unimportant. However, directed bank lending and direct government spending was used to supplement monetary policy to aggressively offset shocks to demand. The model finds that government expenditure feedback reduces the frequency of a business cycle crisis but that any feedback effect on investment creates excess capacity and instability in output.
    Keywords: China; Crises; DSGE model; Financial Frictions; Indirect Inference
    JEL: C1 E3 E44 E52
    Date: 2013–04
  10. By: Kotov, Denis
    Abstract: In this paper we have studied the role of biases in making corporate decisions on investing abroad. We have formulated four conditions under which a corporate investment decision is least exposed to the influence of heuristics. Failing to comply with some conditions of a precise investment performance leads to a situation of a high uncertainty and complexity that demands an intuitive thinking from a decision maker and, as a result, stimulates using the rules of thumb. Further, we have discussed possible measures for the mitigation of the negative influence of heuristics. For an indicative estimation of a degree of biases an ex-ante/ex-post risk perception matrix has been proposed. The study is supported by the results of a survey made in 2008 and structured interviews taken in the spring and the summer of 2013. The survey was carried on among German firms doing business in Russia. Interviews covered not only investments to Russia, but also investments of Russian investors in Europe as well as transatlantic foreign direct investments made in the last three years.
    Keywords: biases; heuristics; investment decisions; foreign direct investments; decision-making process
    JEL: D81 F21 L2
    Date: 2013–09
  11. By: Bin Wang; Tao Sun
    Abstract: This paper investigates macroprudential policies and their role in containing systemic risk in China. It shows that China faces systemic risk in both the time (procyclicality) and cross-sectional (contagion) dimensions. The former is reflected as credit and asset price risks, while the latter is reflected as the links between the banking sector and informal financing and local government financing platforms. Empirical analysis based on 171 banks shows that some macroprudential policy tools (e.g., the reserve requirement ratio and house-related policies) are useful, but they cannot guarantee protection against systemic risk in the current economic and financial environment. Nevertheless, better-targeted macroprudential policies have greater potential to contain systemic risk pertaining to the different sizes of the banks and their location in regions with different levels of economic development. Complementing macroprudential policies with further reforms, including further commercialization of large banks, would help improve the effectiveness of those policies in containing systemic risk in China.
    Keywords: Macroprudential Policy;China;Financial risk;Banking sector;Systemic risk, Macroprudential policies, Effectiveness
    Date: 2013–03–27
  12. By: Giovanni Andrea Cornia (Università degli Studi di Firenze); Bruno Martorano
    Abstract: The paper discusses the income inequality changes which have taken place in a few representative developing regions during the last 30 years. While inequality rose in the majority of the countries of these regions in the 1980s and 1990s, the last decade was characterized by a bifurcation of inequality trends. This divergence offers the possibility to contrast the experience of virtuous regions (Latin America and parts of East and South-East Asia) and non-virtuous regions (the European economies in transition and China) so as to draw useful lessons. Since the global economic conditions affecting inequality in these countries were not too dissimilar and since no major variations in endogenous factors were evident across the regions analysed, the difference in inequality trends between virtuous and non-virtuous regions was most likely due to institutional factors and public policies. An econometric test confirms that the reduction of inequality is possible even under open economy conditions if a given set of appropriate macroeconomic, labour, fiscal and social policies is adopted by governments.
    Keywords: trends in income inequality, factor income distribution, democracy, policy reforms, international economic integration, international crisis, China, South East Asia, Latin America, transition economies of Europe.
    JEL: D31 E60 I38 J08 P51
    Date: 2013
  13. By: Benedikter, Simon; Waibel, Gabi; Birtel, Serge; Bui, Cuong The; Tran, Be Thanh
    Abstract: Empirical evidence from developing countries has illuminated the vital role private business development plays in rural transformation and the creation of off‐farm livelihoods. Since ‘renovation’ (Đổi mới) was promulgated by the Vietnamese Communist Party in 1986, Vietnam has experienced rapid growth and development through the transition from state to market. While de‐collectivization and the return to householdbased rural production reduced poverty and increased growth, entrepreneurship development in the form of Small and Medium Enterprises(SME) has emerged as a strong agent for socio‐economic diversification. The Mekong Delta, located in the Southwest of Vietnam, is a rural setting traditionally reliant on agriculture but has been facing rapid rural transformation over the past three decades. Against a background of agrarian modernization, economic liberalization, international integration and environmental change, this report explores the diversity of entrepreneurial activities and SME development in typical peri‐urban and rural settings of the region. Empirical findings on the trajectory of rural entrepreneurship development, enterprise characteristics, and the social profiles of business owners are presented. Beyond that, changes brought about by rural enterprises for livelihood diversification, social security and labor market dynamics are disaggregated and discussed by different business types and corresponding modus operandi (growth‐oriented vs. livelihood‐oriented enterprises). Finally, the results are contrasted with current government notions of promoting SMEs development as a driver of economic growth. Diverging from the government’s vision for boosting SME development in the context of rural industrialization, the large majority of private business establishments in the Mekong Delta are micro‐enterprises which operate at subsistence levels, while growth‐oriented SMEs remain the exception. Consequently, there is a need to reconsider policy formulation for more sustainability in the rural SME sector.
    Keywords: Entrepreneurship development, SME, rural transformation, Mekong Delta, Vietnam
    JEL: O14 O18 Z13
    Date: 2013–09
  14. By: Alexander Chubrik; Alaksei Kazlou
    Abstract: Labour migration does not appear to have the same magnitude and socio-economic importance in Belarus as in other EaP countries. It is one of the few post-socialist economies that have preserved the dominance of the state sector and built complicated systems of subsidisation and economic support for the population designed to manage the political-business cycle (see Chubrik, Shymanovich, Zaretsky (2012)). This model has allowed the economy to grow quite steadily until recently. However, the distorted system of incentives that was created for enterprises and households has resulted in the need for a “correction”, which happened in the form of a balance of payments crisis in 2011. The impact of this factor on migration has not been fully visible yet. At the same time the relatively long period of stability and gradual, but steady, increase in welfare payments has played a role as a migration-restraining factor. In order to estimate cost and benefits of labour migration between EU and Belarus, this study utilises publically available literature as background and relies where possible on micro-data: Census-2009, Household Budget Survey (HBS), as well as relevant official data and data from polls related to the topic. Additionally, some sections of this report rely on information collected in the course of a focus group meeting with labour migrants and a series of in-depth interviews with officials from state, international, and non-governmental agencies dealing with migration. Lastly, in some cases anecdotal evidence was collected to support some of the new trends that have not yet been recorded in the statistics.
    Keywords: Labour Economics, Labour Markets, Labour Mobility, Belarus
    JEL: D78 F22 F24 I25 J01 J15 J40 J61 J83
    Date: 2013–09
  15. By: Sauer, Johannes; Gorton, Matthew; Davidova, Sophia
    Abstract: Kosovo, like most of rural Central and Eastern Europe, has witnessed substantial out-migration in recent years, prompting debates on the effect of migration on agricultural efficiency. This paper addresses this issue, drawing on a large (n=2217) and representative sample of agricultural households. A two-stage estimation procedure is followed: a frontier technique to estimate the effect of migration on farm efficiency, followed by a matching estimation approach to robustly estimate the sample average effect on efficiency for different levels of migration intensity. Migration has an efficiency decreasing effect which is amplified for better educated and older workers.
    Keywords: Migration, Technical Efficiency, Agricultural Households, Kosovo, Agricultural and Food Policy, Production Economics, Productivity Analysis,
    Date: 2013
  16. By: Luca Barbone; Mikhail Bonch-Osmolovskiyi; Matthias Luecke
    Abstract: This study is part of the project entitled “Costs and Benefits of Labour Mobility between the EU and the Eastern Partnership Countries” for the European Commission1. The study was written by Luca Barbone (CASE) Mikhail Bonch- Osmolovskiy (CASE) and Matthias Luecke (Kiel). It is based on the six country studies for the Eastern Partnership countries commissioned under this project and prepared by Mihran Galstyan and Gagik Makaryan (Armenia), Azer Allahveranov and Emin Huseynov (Azerbaijan), Aleksander Chubrik and Aliaksei Kazlou (Belarus), Lasha Labadze and Mirjan Tukhashvili (Georgia), Vasile Cantarji and Georgeta Mincu (Moldova), Tom Coupé and Hanna Vakhitova (Ukraine). The authors would like to thank for their comments and suggestions Kathryn Anderson, Martin Kahanec, Costanza Biavaschi, Lucia Kurekova, Monica Bucurenciu, Borbala Szegeli, Giovanni Cremonini and Ummuhan Bardak, as well as the dbaretailed review provided by IOM. The views in this study are those of the authors’ only, and should not e interpreted as representing the official position of the European Commission and its institutions.
    Keywords: Labour economics, Labour markets, Labour mobility, ENPI, EU, Eastern Partnership, Armenia, Azerbaijan, Belarus, Georgia, Moldova, Ukraine
    JEL: F22 F24 D78 I25 J15 J83 J01 J40 J61
    Date: 2013–09
  17. By: Irina Starodubrovskaya (Gaidar Institute for Economic Policy)
    Abstract: In December 2012, the Russian government adopted the "Programme for the Development of the North Caucasus Federal District (NCFD) up to 2025" (hereinafter referred to as the Programme). The total funding up to 2020 was approved at a level of 2.55 trillion RUR, and it was determined that the state budget would provide 10% of the funds, while 90% should be made up from investor funds. Note that this proportion is roughly consistent with the principle of distribution of budgetary and non-budgetary finance adopted earlier for some of the projects implemented under the Programme. Thus, of the total costs of holiday resort construction projects in the North Caucasus, 60 billion rubles out of 510 billion rubles will be financed from the budget (through the project operator: Resorts of the North Caucasus JSC (with a 98% stake owned by the Government of the Russian Federation). The State has systematically demonstrated its goal to ensure the economic development of the North Caucasus mostly through investors. They are granted tax benefits, if they register in the new special economic zones (SEZ) created in the North Caucasus, as well as government guarantees on loans grant-ed on an individual competitive basis.
    Keywords: North Caucasus, investment, local communities, Dagestan Republic
    JEL: R10 R11 R12 R13 R14
    Date: 2013
  18. By: Gregorio Impavido; Heinz Rudolph; Luigi Ruggerone
    Abstract: CESEE banks are reducing foreign funding sources in response to reduced external imbalances, reduced ability to tap international savings, banking group own strategies, initiatives by some regulators, and consistently with uncertainties surrounding the future of the banking union project. In the medium term, the global regulatory agenda and the high foreign presence and stock of FX loans exert opposite forces on rebalancing trends. In the long-term, any funding “new normal†will be determined by the future design of the EU financial architecture. In the meantime, limiting leverage, the use of FX loans and promoting aggregate saving through macro policies and capital market reforms will increase resilience against shocks going forward.
    Keywords: Banks;Central and Eastern Europe;International banking;External financing;Global Regulatory Agenda, Eastern Europe, Bank Funding, Deleveraging.
    Date: 2013–06–19
  19. By: Popovic, Milenko; Cizmovic, Mirjana
    Abstract: The topic of this paper is comparative analysis of the economic growth in the former SFRY countries. The paper is primarily devoted to the analysis of the sources of economic growth in these countries. In this regard, apart from conventional decomposition of growth (contributions of capital, labor and total factor productivity), the demand and the industry composition sides of the sources-of-growth analyses have also been considered. Furthermore, the reserves for further rise in GDP per capita have been identified and estimated on the basis of obtained results. Special attention has been paid to possible increase in the total factor productivity induced by the advance in “broader knowledge” as well as to increase in the labor participation rate. Institutional and policy prerequisites for realization of these reserves of growth are also briefly analysed.
    Keywords: sources of growth, growth reserves, convergence
    JEL: O40 O43 O47
    Date: 2013–07–18
  20. By: Yasser Abdih; Leandro Medina
    Abstract: This study estimates the size of the informal economy, and the relative contribution of each underlying factor, for the Caucasus and Central Asia countries in 2008. Using a Multiple Indicator-Multiple Cause model, we find that a burdensome tax system, rigid labor market, low institutional quality, and excessive regulation in financial and products markets are determinant factors in explaining the size of the informal economy, which ranges from 26 percent of GDP in Kyrgyz Republic to around 35 percent of GDP in Armenia. Furthermore, the results show that higher levels of informality increase the levels of self employment and the percentage of currency held outside the banking system.
    Keywords: Shadow economy;Central Asia;Tax burdens;Labor markets;Economic models;Cross country analysis;Informal economy; latent variable; Caucasus and Central Asia.
    Date: 2013–05–31
  21. By: Michael Landesmann (The Vienna Institute for International Economic Studies, wiiw); Isilda Mara (The Vienna Institute for International Economic Studies, wiiw); Hermine Vidovic (The Vienna Institute for International Economic Studies, wiiw)
    Abstract: Abstract The study provides new empirical evidence about migration patterns of immigrants from Serbia and Bosnia and Herzegovina in Austria before and after the free visa regime implemented from January 2010 and January 2011 respectively for the two groups of migrants. In this framework a new survey was conducted and about 1000 migrants from Serbia and Bosnia and Herzegovina (BiH) currently residing in Austria were interviewed. Apart from the collection of standard demographic and socio-economic characteristics, the survey included specific immigration-related questions. The evidence collected through the survey allowed to examine migration intentions, distinguishing between temporary and permanent migration plans, human capital formation in the destination country and labour market experience of different groups of migrants. The results of the survey suggest that the preference for permanent migration is predominant particularly among BiH and the earlier group of Serbian migrants who moved to Austria before visa liberalisation. Serbian migrants who moved to Austria after visa liberalisation show a lesser preference for permanent migration. Serbian migrants and BiH migrants who moved to Austria before visa liberalisation were mainly driven by economic motives, such as taking up a job offer or looking for better working/earning opportunities. Those who moved during the free visa regime were motivated by better studying opportunities, better earnings and prospects of a higher standard of living. The skill composition of migrants is differentiated; there are more BiH migrants with tertiary-level education compared to Serbian migrants. However, Serbian migrants, especially those who moved to Austria before visa liberalisation, have considerably invested in and enhanced their human capital in Austria. Migrants are employed well below their skill levels and mainly have occupations that are classified as low-qualified jobs. In particular, compared to BiH migrants, the allocation of Serbian migrants to low-skilled jobs has been more pronounced among migrants who moved to Austria after visa liberalisation. Consequently, the differences in the level of qualification, type of occupation, adequacy of job qualification and competences, were reflected in significant differences in terms of earnings for the three groups of migrants. The access to social benefits or access to the health care system is strongly related to the length of stay. Generally only one third of migrants receive social benefits, mainly through family allowances, such as child and housing benefits. Migrants with permanent intentions have a better command of the German language and tend to use it more intensively in a family, working and everyday life context. Besides, this group of migrants – as compared to potential returnees – appeared to be much happier with the migration experience and with the decision to come to and live in Austria. The study and an accompanying Working Paper (see Mara and Landesmann, 2013) also analyses the incidence of over-qualification and skill-occupational mismatch among migrants which can be partly explained by factors such as human capital transferability, enhancement of education in the destination country but also partly by discrimination. Accordingly, policy measures that target the efficient use of human capital built in the country of origin as well as the enhancement of migrants’ human capital in the destination country would counteract the phenomenon of brain waste.
    Keywords: migration patterns, temporary vs. permanent migration, labour market outcomes, qualifications-job matching, integration of migrants, migrants from Serbia and Bosnia-Herzegovina in Austria; bivariate probit model regressions.
    JEL: C35 F22 J24 J61
    Date: 2013–08
  22. By: Suchon, Aneta Anna
    Abstract: The article assesses legal regulations regarding managing agricultural lands in Poland. The paper presents, first of all, the scope of activity of the Agricultural Property Agency, which is a significant institution on the property market. This institution started its activity on 1 January 1992 and its main task was to take over all state agricultural property and to manage the property in compliance with the regulations. Secondly, the article analyzes basic regulations concerning the sale and lease. They both give legal title to organize family as well as large farms. It also presents information about perpetual usufruct. Additionally, the article shows the EU instruments which have an essential impact on changing the agricultural structure, namely structural pensions and bonuses for young farmers.
    Keywords: agricultural lands, agrarian structure, sale, lease, EU funds, Agribusiness, Agricultural Finance, Land Economics/Use,
    Date: 2013
  23. By: Marta Spreafico (DISCE, Università Cattolica)
    Abstract: Based on the various works on the relevance of the institutional arrangements for a country’s economic performance, this paper studies the role and the determinants of the reform policies for the development paths of the transition countries. Looking at the U.S.S.R breakdown as an extremely powerful “experiment” and considering the nature of its consequences, the paper investigates the importance of policy reforms for the productivity growth looking for possible structural break and differences among of the nations in transit. The paper studies the different patterns of reforms using a synthetic measure treated as endogeneous and instrumented by the rents coming from the natural endowments, the extent of the democratic progress and the trade openness. The paper proves that these determinants have played a different role in explaining the pattern of reform policies of the transition countries, which in turn has affected their productivity growth paths. Empirically, the paper develops a dynamic approach implementing the more advanced econometric techniques.
    Keywords: economic growth, institutions, reforms, transition economies, dynamic models, panel analysis
    JEL: C33 E02 O11 O43 P20 Q30
    Date: 2013–04
  24. By: Yang, Zhenzeng
    Abstract: I use cross-country panel data to show that strengthening of private property rights protection lowers pollution emission intensity. The finding is robust to the inclusion of many controls and use of different independent variables. This paper provides preliminary empirical evidence for property rights theory of environmental goods, and suggests that completely specifying property rights is an important approach to response to environmental degradation.
    Keywords: Private Property Rights, Pollution, Emerging Market, CO2 Emission
    JEL: Q28 Q56
    Date: 2013–07–30
  25. By: Bialowolski, Piotr; Weziak-Bialowolska, Dorota
    Abstract: In this paper we attempt to investigate the importance of certain external factors on the investment decision among Polish companies. With the use of data from the tailored made Survey on Receivables we examine factors influencing investment decisions of companies in Poland, assess the relation between the branch and company size and importance of the factors and finally we determine the relative influence of these factors on the actual investment reductions. The results showed that first, although the problem of payment delays is the most important single reason determining the investment decisions of Polish companies, its importance decreases when analyzed simultaneously with other reasons. Second, there are two driving forces determining the investment decisions of Polish companies, namely macroeconomic factors and law-related factors with the relative importance of the former lower than the latter. Third, there is a positive association between the importance attached to factors influencing investment decisions associated with either macroeconomic or legal environment and the investment reductions, meaning that companies facing higher investment reductions are also more prone to notice and value the factors influencing these decisions. --
    Keywords: investment decisions,company,survey,structural equation modelling
    JEL: D92 G11 G31
    Date: 2013
  26. By: Anosova, Daria; Sonin, Konstantin; Vanags, Alf; Zasova, Anna
    Abstract: In terms of output decline and increase in unemployment, the economic recession in Latvia that started during the 2008-09 financial crisis was one of the most severe in the world. Using both decomposition of the unemployment rate into structural and cyclical components and Mortensen and Pissarides’ search and matching approach, we demonstrate that the changes in unemployment should be attributed primarily to cyclical, rather than structural factors; as of 2013, a large share of Latvian unemployment is still cyclical. Our results provide important implications for anti-crisis policy in Latvia and elsewhere in the world: the surge in unemployment was largely a consequence of Latvia’s austerity policy.
    Keywords: Beveridge curve; cyclical unemployment; labour market matching; structural unemployment
    JEL: E24 J60
    Date: 2013–06

This nep-tra issue is ©2013 by J. David Brown. It is provided as is without any express or implied warranty. It may be freely redistributed in whole or in part for any purpose. If distributed in part, please include this notice.
General information on the NEP project can be found at For comments please write to the director of NEP, Marco Novarese at <>. Put “NEP” in the subject, otherwise your mail may be rejected.
NEP’s infrastructure is sponsored by the School of Economics and Finance of Massey University in New Zealand.