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on Transition Economics |
| By: | Loren BRANDT; Johannes VAN BIESEBROECK; Yifan ZHANG |
| Abstract: | Over the reform period, industry has been the source of forty percent of GDP, and has contributed 90% of China’s exports. Annual firm level surveys that begin in 1992, along with industry-wide census in 1995, 2004 and 2008 are rich sources of data on firms’ actions in this important sector. It is well-known that working with Chinese data requires overcoming challenging measurement issues. Macroeconomic series are often suspected to suffer from political interference or reporting biases that stem from political incentives. Working with the firm-level data has its own challenges. Making sure that comparisons over time are consistent is perhaps the most difficult and pervasive issue. This is because of sampling as well as measurement issues for key variables, such as ownership type, real output, value-added, wages, and the capital stock. These problems are apparent, for example, in discrepancies between the evolution of aggregates from the firm-level data and aggregate statistics in the national income accounts. In this paper, we provide an introduction to these data sets. We discuss and illustrate several of the issues that make comparability over time difficult and we suggest solutions for many of them. The importance of a particular measurement issue often depends on the exact application. We illustrate this point by tracing the evolution of the relative productivity level of entrants and incumbents over time, trying to distinguish between changes in actual performance and changes driven by measurement problems. We conclude by identifying a few promising areas of future research and margins on which collaboration among users to improve these data might be beneficial. |
| Date: | 2014–06 |
| URL: | http://d.repec.org/n?u=RePEc:ete:ceswps:ces14.15&r=tra |
| By: | Olga Timokhina (St. Petersburg National Research University of Information Technologies, Mechanics and Optics) |
| Abstract: | In the paper we review Chinese foreign direct investment in Africa, which have increased significantly in the last decade. So-called BRICS countries (Brazil, Russia, India, China and South Africa) are actively investing abroad, becoming leading FDI exporters among emerging economies, and China is dominating in BRICS outward FDI (the share of Chinese outward FDI in world outward FDI was 6.05% in 2012). China has become a significant FDI exporter in the late 1990-s and by 2012 Chinese outward FDI stock reached 121080 ml. USD figure. Chinese investments are held both by private enterprises and state-owned companies. Chinese OFDI challenges the classic internationalization theories, which are based on the observation of traditional FDI from developed economies that are historically, economically and institutionally different from China. Undoubtedly the Chinese government plays a critical role in encouraging Chinese companies to invest in Africa, providing direct and indirect investment policy regulation, subsidizing and promotion of FDI. Africa is still perceived as a risky direction for investment, though China is actively investing in this region. Since resource-seeking motivation for investment is especially relevant for China, resource-rich African countries are attractive for Chinese state-owned companies. Bilateral trade between China and Africa in 2012 is rapidly growing and accounted for about 5 percent of China's total trade and about 16 percent of Africa's overall trade. China's FDI outflows to Africa are also increasing (from 500 mln. USD in 2003 to almost 15 bln. USD by 2012). The paper analyses Chinese OFDI in Africa and focuses on corporate social responsibility (CSR) of Chinese companies. In particular, we review regulatory documents for CSR in China and their application for Chinese investment in Africa. The strategic importance of CSR is not always acknowledged in by Chinese enterprises, thus resulting in shortage of capacity to incorporate CSR into corporate management. China clearly has an important economic role to play in Africa‟s development. The Chinese government has established China Africa Development Fund to support Chinese investors in African projects and has invested in creation of six special economic zones across the continent. All these measures influence the perception of China as an investor in African economies. |
| Keywords: | Foreign direct investment, corporate social responsibility, state regulation, BRICS, China, Africa, emerging markets, governmental policy, liberalization of investment |
| Date: | 2014–09 |
| URL: | http://d.repec.org/n?u=RePEc:msm:wpaper:2014/29&r=tra |
| By: | Sandra Poncet; Florian Mayneris; Tao Zhang |
| Abstract: | We study how the 2004 reform of minimum wage rules in China has affected the survival, average wage, employment and productivity of local firms. To identify the causal effect of minimum wage growth, we use firm-level data for more than 160,000 manufacturing firms active in 2003 and complement the triple difference estimates with an IV strategy that builds on the institutional features of the 2004 reform. We find that the increase in city-level minimum wages resulted in lower survival probability for firms that were the most exposed to the reform. For surviving firms, wage costs increased without negative repercussions on employment. The main explanation for this finding is that productivity significantly improved, allowing firms to absorb the cost shock without hurting their employment nor their profitability. At the city-level, our results show that higher minimum wages fostered aggregate productivity growth thanks to productivity improvements of incumbent firms and net entry of more productive ones. Hence, in a fast-growing economy like China, there is a cleansing effect of labor market standards. Minimum wage growth allows more productive firms to replace the least productive ones and forces incumbent firms to strengthen their competitiveness, these two mechanisms boosting the aggregate efficiency of the economy. |
| Keywords: | minimum wages;firm-level performance;aggregate TFP;China |
| JEL: | F10 F14 O14 |
| Date: | 2014–09 |
| URL: | http://d.repec.org/n?u=RePEc:cii:cepidt:2014-16&r=tra |
| By: | Yulia Vymyatnina; Evgeniya Goryacheva |
| Abstract: | Using monthly and quarterly data for 2000 – 2012 for Belarus, Kazakhstan and Russia we estimate monetary policy rules for these countries. The aim of our study is to find out similarities and differences in monetary policy practices in these countries in order to evaluate potential problems in switching to unified macroeconomic policy that is envisaged within the Common Economic Area. We analyze official statements of the Central Banks, dynamics of major macroeconomic indicators, estimate modified monetary policy rules and conclude that Kazakhstan and Russia have similar monetary policy, while Belarus will have to change most of its practices in case the unified monetary policy is introduced in the Common Economic Area. |
| Keywords: | Customs Union, Common Economic Area, monetary policy rules, inflation, Russia, Belarus, Kazakhstan |
| JEL: | E52 F42 |
| Date: | 2014–08–29 |
| URL: | http://d.repec.org/n?u=RePEc:eus:wpaper:ec0514&r=tra |
| By: | Brasili, Cristina; Barone, Barbara; Bin, Peng |
| Abstract: | Paraphrasing the 1996 World Food Summit definition, “food insecurity” exists when “not” all people, “not” at all times, have physical and economic access to sufficient safe and nutritious food. In this perspective, our study examines the relation between spatial inequality and vulnerability to food insecurity from a socioeconomic perspective. A longitudinal analysis is applied to estimate the regional food vulnerability at provincial and sub-provincial level and the rural and urban contributions to the integral regional vulnerability are underlined. Theil Index and Herfindahl Index are used to quantify the basic factors for the evaluation of economic vulnerability to food consumption and diversity of food structure, which we also based on to proceed further studies and benchmark 31 Chinese provinces and municipalities by their vulnerability to food insecurity. Our main aim is to fill up the gap of analysing regional food vulnerability in a socioeconomic point of view in China, and hence to better depict the regional disparity in food vulnerability and try to provide useful information on the reality of food insecurity. |
| Keywords: | Food insecurity, economic vulnerability, regional disparity, convergence, Agribusiness, Agricultural and Food Policy, Marketing, Q180, O130, O180, |
| Date: | 2014 |
| URL: | http://d.repec.org/n?u=RePEc:ags:aiea14:173107&r=tra |
| By: | Chan, Mark K.; Kwok, Simon |
| Abstract: | We analyze the effects of a recent financial reform that enables cross-market invest-ment between Hong Kong and Shanghai stock exchanges. Using a vector error-correction model, we found that the reform announcement considerably narrows the equilibrium level of price disparity and strengthens the price comovement of shares that are cross-listed in both markets. First, there is a substantial increase in the number of cross-listed firms with cointegrated share prices, and the estimated equilibrium relationship is in support of the relative law of one price. Second, our model predicts that the price disparity narrows by as much as 40 percent in equilibrium. Third, we found that both markets adjust in response to a disequilibrium in price disparity, leading to a sizable error-correction activity. The Shanghai market contributes to approximately two-thirds of the price discovery process. Competition and informativeness of trading affect the relative role of price discovery in each market. |
| Keywords: | Capital account liberalization; co-integration; vector error-correction model; cross-listing; Chinese A-H shares |
| Date: | 2014–08 |
| URL: | http://d.repec.org/n?u=RePEc:syd:wpaper:2014-08&r=tra |
| By: | Timothy Swanson (Centre for International Environmental Studies, IHEID, The Graduate Institute of International and Development Studies, Geneva); Chiara Ravetti; Yana Popp Jin; Mu Quan; Zhang Shiqiu |
| Abstract: | This paper looks at the problem of information control behind the unsustainable levels of air pollution in China. In particular, it focuses on a large urban area, Beijing, and it examines the role of the public, government-controlled information and the adaptation choices of households in response to signals about high pollution. Our analysis is based on a simple theoretical framework in which people migrate from rural areas to polluted cities, receiving a signal from the government about urban pollution; hence, they decide whether to adapt to pollution or not. We find that the government has no incentive to ensure sustainable air quality, as it can distort pollution information in order to attract cheap labour. We then analyse empirically two different air pollution indexes from different sources and agents’ behaviour in an original household survey collected in Beijing. We find that the official air pollution values are systematically distorted, creating perverse incentives for households to react to bad air quality, especially for people who rely on government-controlled sources of information. |
| Keywords: | Air Pollution; Government; Information; Averting Behaviour; Sustainability. |
| JEL: | Q53 Q56 Q58 |
| Date: | 2014–08–29 |
| URL: | http://d.repec.org/n?u=RePEc:gii:ciesrp:cies_rp_27&r=tra |
| By: | Petr Huber (Austrian Institute for Economic Research (WIFO), Arsenal, Objekt 20, 1030 Wien and Faculty of Business and Economics, Mendel University in Brno.); Ulugbek Rahimov (Faculty of Economics, Westminster International University in Tashkent) |
| Abstract: | Analyzing the self-selection of workers into formal and informal sector employment in Tajikistan, a poor transition economy, with higher informal sector than formal sector wages and an informal sector employment share exceeding 50 percent, we find that the selection of formal and informal sector workers is based on comparative advantages rather that labor market segmentation. Furthermore, labor supply to the two sectors reacts rather elastically to relative wages. Policies increasing relative wages in the formal sector could thus be effective in reducing the high informal sector employment share in this country. |
| Keywords: | formal/informal sector wages, self selection, segmentation |
| JEL: | J31 J42 J21 |
| Date: | 2014–09 |
| URL: | http://d.repec.org/n?u=RePEc:men:wpaper:48_2014&r=tra |
| By: | Martha Prevezer; Lutao Ning; Yuandi Wang |
| Abstract: | Research Question: How does Chinese corporate governance in publicly-listed firms affect the relationship between innovation productivity and top management turnover? Is state shareholding in China a positive force for innovation productivity? Research Insights: A balance is maintained between the negative effect of (relatively high) top management turnover on investment horizons and innovation productivity, mitigated by positive effects of high state ownership, up to a certain level of ownership concentration. Beyond this level, potential for abuse by the dominant shareholder curtails positive effects on innovation. This contrasts with foreign dominant shareholders where no alignment between dominant shareholder and top management occurs and shorter investment horizons are preferred with lower innovation productivity. Theoretical Implications: In China, with state-held and controlled publicly listed firms, there is an alliance between the dominant shareholder and top management with relatively low employee protection and weak protection for lesser shareholders . This may have positive outcomes for long term innovation but may also lead to principal-principal abuses. Any such alliance needs to be tempered by stronger internal governance structures to protect minority shareholders. But stronger protection may in turn reduce investment horizons and lower innovation. Policy Implications: As well as strengthening external corporate governance mechanisms, insider corporate governance mechanisms need to be strengthened to discipline managers. However stronger countervailing powers to secondary shareholders, stronger Supervisory Board rights and greater independence of Directors may tend to decrease time horizons of investment for the firm and impede innovation. |
| Keywords: | Corporate governance, Top management turnover, innovation performance, China |
| JEL: | P3 L2 P5 |
| Date: | 2014–09 |
| URL: | http://d.repec.org/n?u=RePEc:cgs:wpaper:53&r=tra |
| By: | Peter Schmidt (National Research University Higher School of Economics); Nadezhda N. Lebedeva (National Research University Higher School of Economics) |
| Abstract: | This study examines the relationship between values, efficacy, trust and innovative organizational behaviour in Russia. We analyse the direct and indirect effect of gender, age and education on innovative behaviour via values, trust and efficacy. For the measurement of values we employed a new revised value instrument with 19 values. We found that Openness to Change values had a significant positive effect and Conservation values a significant negative effect on innovative behaviour in organizations; efficacy and trust had a significant positive effect. Moreover, the effect of values is moderated by the level of efficacy. Gender, age and education directly influence innovative behaviour and determine such behaviour via values, efficacy and trust. |
| Keywords: | human values, innovation, innovative behaviour, trust, gender, education, region, age |
| JEL: | Z |
| Date: | 2014 |
| URL: | http://d.repec.org/n?u=RePEc:hig:wpaper:21psy2014&r=tra |
| By: | van Tuijl, E.; Dittrich, K. |
| Abstract: | This article analyses how upgrading takes during events. We do this via a systematic analysis of different upgrading mechanisms, seen through the lens of three players: firms, event organisers and the media. Our empirical study of China’s largest auto show reveals that upgrading takes particularly place via monitoring and global buzz. In addition, it offers the potential to develop new global pipelines between Chinese and Western firms. Mobility turned to be less relevant as an upgrading mechanism. The media and the organisers both influence the possibilities for monitoring and global buzz. Moreover, the latter can affect the access to new global pipelines. |
| Date: | 2014–09–11 |
| URL: | http://d.repec.org/n?u=RePEc:ems:eureri:76070&r=tra |
| By: | Bayanslu Markhayeva (Almaty Management University) |
| Abstract: | On May 29, 2014 Belarus, Kazakhstan and Russia signed an agreement on the integration to the Eurasian Economic Union (EaEU) which formally goes into effect on January 1, 2015. A new common market of goods and factors of production will appear on the map of the planet. There are 170.3 million people living here (or 4.4% of the world population), 5.6% of which are citizens of Belarus and 10% are from Kazakhstan and 84.4% are Russians. The market territory occupies 16,4% of the terrestrial land where 25% of basic types of minerals reconnoitered in the world are concentrated and its cost is estimated in the range from 30 to 40 trillion United States dollars (USD). The share of the EaEU accounts for about 40% of the world supplies of natural gas, 25% coal, 20% oil, 25% forest, 13% of arable land and 11% of fresh water. The unique transcontinental geographical position allows to accumulate scale trade streams between Europe and Asia and thereby to increase world competitiveness of the region and the EaEU. |
| Keywords: | Food security, Kazakhstan, Eurasian Economic Union |
| Date: | 2014–09 |
| URL: | http://d.repec.org/n?u=RePEc:msm:wpaper:2014/22&r=tra |
| By: | World Bank |
| Keywords: | Public Sector Corruption and Anticorruption Measures Macroeconomics and Economic Growth - Subnational Economic Development Finance and Financial Sector Development - Bankruptcy and Resolution of Financial Distress Finance and Financial Sector Development - Debt Markets Public Sector Expenditure Policy Public Sector Development |
| Date: | 2014–04 |
| URL: | http://d.repec.org/n?u=RePEc:wbk:wboper:20051&r=tra |
| By: | Birgit Hansl; Damir Cosic; Olga Emelyanova; Mizuho Kida; Mikhail Matytsin; Ekaterine Vashakmadze |
| Keywords: | Banks and Banking Reform Macroeconomics and Economic Growth - Markets and Market Access Private Sector Development - Emerging Markets Finance and Financial Sector Development - Debt Markets Finance and Financial Sector Development - Currencies and Exchange Rates |
| Date: | 2014–08 |
| URL: | http://d.repec.org/n?u=RePEc:wbk:wboper:19972&r=tra |
| By: | Siarheu Manzhynski (Belarusian State Technological University) |
| Abstract: | Corporate social responsibility (CSR) could be an essential driver for innovation and high economic performance in a long-run perspective. First movers can exploit the business opportunities and gain a comparative advantage. But at the same time implementation of strategies and practices based on CSR requires additional costs and distraction from core activities. To what extent can efforts in building up of a social responsible company pay off these costs and benefit? What role does staff’s perception of CSR significance play in firms and corporations for innovation and economic performance improvement? In developed markets the business case for CSR has been found to be relevant both from a theoretical and practical perspective. Emerging economies have many additional economic challenges and where so far many executives perceive CSR requirements to be a burden and extra costs. Based on survey and structural equation modelling methods the relationships between the dimensions of CSR and innovation and economic performances in Belarus as an emerging economy was examined. A total of 310 CEO and managers of industrial companies in Belarus were served as respondents in this study. Main results show a strong link between CSR dimensions and innovation and economic performances. In accordance with that based on survey results and empirical analysis the main obstacles that hinder CRS orientation in Belarus were identified: weak awareness among key stakeholders regarding the potential benefits of and incentives for responsible business; the absence or failure of social and governance factors in strategic and operative plans; and uncertainty over how future economic policy can contribute to CRS. Experience from developed countries shows that a possible way to achieve high innovative activities for Belarus and other emerging countries is to promote social responsibility combined with regulatory measures. The essential benefits and measures of this transformation are also considered in the paper. |
| Keywords: | Corporate social responsibility, structural equation modelling, regulation |
| Date: | 2014–09 |
| URL: | http://d.repec.org/n?u=RePEc:msm:wpaper:2014/32&r=tra |