nep-tra New Economics Papers
on Transition Economics
Issue of 2015‒07‒18
eleven papers chosen by
J. David Brown
United States Census Bureau

  1. Has trade openness reduced pollution in China? By José de Sousa; Laura Hering; Sandra Poncet
  2. Matching Food with Mouths: A Statistical Explanation to the Abnormal Decline of Per Capita Food Consumption in Rural China By Yu, Xiaohua; Abler, David G.
  3. Empirical Analysis on the Structural Changes in Railroad Logistics in China (Japanese) By MENG Jianjun; ZHANG Hongyong
  4. How continuing exporters set the price? Theory and empirical evidence from China By Tan, Yong; Lin, Faqin; Hu, Cui
  5. Will Inequality Lead China to the Middle Income Trap? By S. Nazrul Islam
  6. Financialisation of the water sector in Poland By Piotr Lis
  7. What is the job satisfaction and active participation of medical staff in public hospital reform: a study in Hubei province of China By Pengqian Fang; Zhenni Luo; Zi Fang
  8. Aufwind im Westen Mittel-, Ost- und Südosteuropas: Wichtige Wachstumsimpulse für Österreich By Mario Holzner
  9. Financialisation of the system of provision applied to housing in Poland By Piotr Lis
  10. Output effects of fiscal stimulus in Central and Eastern European Countries By Combes, Jean Louis; Minea, Alexandru; YOGO, Thierry; Mustea, Lavinia
  11. Innovation and exporting: a study on Eastern European firms By Silvia Bertarelli; Chiara Lodi

  1. By: José de Sousa; Laura Hering; Sandra Poncet
    Abstract: We use recent detailed Chinese data on trade and pollution emissions to assess the environmental consequences of China’s integration into the world economy. We rely on a panel dataset covering 235 Chinese cities over the 2003-2012 period and examine whether environmental repercussions from trade openness depends on whether it emanates from processing or ordinary activities. In line with our theoretical predictions, we find a negative and significant effect of trade on emissions that is magnified for processing trade and activities undertaken by foreign firms: much lower environmental gains result from either ordinary trade activities or domestic firms, even though these are today the main drivers of China’s export and import growth. This result invites caution about the prospects for pollution in a context of decline role of processing trade.
    Keywords: Trade openness;Pollution;SO2 emissions;China
    JEL: F10 F14 O14
    Date: 2015–07
  2. By: Yu, Xiaohua; Abler, David G.
    Abstract: This study provides an alternative explanation for the unusual apparent decline in food consumption in rural China after 2000. We find that it is mainly attributable to significant measurement errors in the Chinese Rural Household Survey and the calculation of per capita food consumption. In a household survey, total consumption for a household in a certain period is often well recorded, and per capita consumption is obtained by dividing total consumption by household size. Such a calculation of per capita food consumption is vulnerable to a mismatch between food and mouths. Total consumption may be subject to measurement errors caused primarily by food away from home (FAFH). Also, the household size recorded in the survey is not necessarily the same as the number of mouths (consumption household size), who consume the food recorded in the survey. Our results indicate that food consumption in rural China is currently being underestimated by about 30%. Our results also indicate that income elasticities of food consumption are greater than measured elasticities based on the Rural Household Survey data.
    Keywords: Food demand, underreporting, rural China, food away from home, off-farm migration, Consumer/Household Economics, Food Consumption/Nutrition/Food Safety, Food Security and Poverty, Q11, C81, O13,
    Date: 2015–02
  3. By: MENG Jianjun; ZHANG Hongyong
    Abstract: In China, with its vast land area, railroad transportation plays the most important role in forming an extensive basic logistics structure and logistics system. However, since 1949, railroad logistics has not been used freely as it has been managed under the centralized control of the Ministry of Railways, which is a semi-military organization in nature under a national strategy. Since shifting to reform and opening-up policies in 1978, economic resources have been mobilized as a result of the revitalization of the local economy, and railroad logistics has commenced according to the market mechanism toward the unified local economy, namely, the unified domestic market. In March 2013, the Ministry of Railways was dismantled, and China Railway Construction Corporation, which is a business organization, was officially founded. As a result, the managing right and ownership of railroads that was monopolized by the state as well as the market including railroad construction was opened fully to private enterprises and local governments, thereby triggering a gradual commercialization of railroad logistics.This paper—focusing on the significance of railroad logistics during the reform and opening-up period—aims to clarify the relations between the structural changes in China's railroad logistics and the unified local economy due to commercialization by conducting an empirical analysis with a gravity model using data on inter-regional rail freight transportation volume from 1990-2012. Through such empirical analysis on railroad logistics, the following important facts were observed. Although structural changes in railroad logistics are influenced by the physical distance between regions, long distance transportation has commenced along with economic growth in each region, thereby moving toward integrated local economies. In particular, growth in demand in the secondary industry located in each spoke in the road networks largely contributes to structural changes in railroad logistics. Concurrently, it should be noted that the structural changes in railroad logistics are still under the influence of state-owned enterprises from each region.
    Date: 2015–05
  4. By: Tan, Yong; Lin, Faqin; Hu, Cui
    Abstract: In this paper, we build a dynamic game model of quantity competition to explain the price difference between continuing exporters and exits. Continuing exports are forward looking and they may intentionally set a lower price in the export market at current stage to crowd out the competitors to maximize the overall expected profit in their total life period. Using a large sample of matched panel data of Chinese firms from firm-level production data and product-level trade data, we find that after controlling the most important determinants of export price as well as the firm-year-specific effects, continuing exporters charge a price 42.4%-54.0% lower than the price level charged by future exits in China.
    Keywords: Export prices, Dynamic game, Quantity competition
    JEL: C73 F10
    Date: 2015–07
  5. By: S. Nazrul Islam
    Abstract: China has departed from the East Asian model of development by letting inequality to rise to a high level, which is contributing to China’s current problems of macroeconomic imbalance, declining efficiency of capital, and rising social tensions. If inequality persists, China may get caught in the “inequality-trap,” which may then lead it to the “middle income trap (MIT).” Fortunately, China still has the levers to pull to reduce inequality and avoid MIT. Measures along both the “wage route” and the “redistributive route” can be adopted for this purpose. In addition, China may pursue the “cooperative route” to more equitable distribution.
    Keywords: China; Middle Income Trap; Inequality Trap; Inequality; Redistribution; Cooperatives
    JEL: O1 O4 O5
    Date: 2015–07
  6. By: Piotr Lis (Department of Economic and Local Government Policy, Poznan University of Economics, Poland)
    Abstract: Over the last decade there has been dynamic development of technical infrastructure connected with the water economy in Poland. In the years 2000-2013, the water system network expended three times. Such development was possible thanks to the subsidies granted for the realisation of infrastructural investments under the European Union pre-accession (ISPA) as well as post-accession programmes (Structural Funds, Cohesion Funds) supported by state institutions responsible for environmental protection (the Ministry of Environment, the National Fund of Environmental Protection and Water Management). The financial means obtained from bank loans constituted an insignificant part of infrastructural investments. Responsibility for the water system, including the collective supply of water and collective discharge of sewage, is held by gminas1 and it is their own task under the municipal economy. Gminas, the number of which is 2479 in Poland, commission water and sewage service enterprises to perform these tasks. Such enterprises, characterised by a very fragmented structure, play a monopolistic role in a given gmina or a collection of gminas. That is why, the process of financialisation of this sector seems to be rather slow. Political conditions in local communities constitute additional limitations to abrupt ownership transformations in the water sector. Of key importance in water sector is the process of establishing tariffs for collective water supply and collective sewage discharge. The manner of validating the tariffs by gminas is, however, rather questionable. The total price of water supply in Poland varies to a large degree, compared to the prices of electricity or gas supply. It comes as a result of geographical and geological conditions in particular gminas as well as a large scale of proecological investments. Furthermore, the prices of water constitute a crucial political factor used in the fight for votes in the local government elections. The agreement from the gmina’s authorities to increase water prices may contribute to their political defeat and a loss of influence. The sector of water and sewage services is not supervised by a central regulatory authority. The functioning of water and sewage service enterprises is supervised by individual gminas. Thus, a conflict of interests occurs, i.e. gminas establish water and sewage service enterprises which they subsequently supervise. That is why, there has been a discussion in Poland over the creation of a central regulatory authority and the consolidation of the sector. These activities could lead to an intensive privatisation of this area of the economy and a significant growth in the level of financialisation of this sector.
    Keywords: water, water sector, provision of water, collective water supply, water and sewage service enterprises, financialisation of the waters sector.
    JEL: Q56 Q59 H41 H42 G21
    Date: 2015–03–01
  7. By: Pengqian Fang; Zhenni Luo; Zi Fang
    Abstract: Background: In China, public hospital reform has been underway for almost 5 years, and 311 pilot county hospitals are the current focus. This study aimed to assess the job satisfaction and active participation of medical staff in the reform. A total of 2268 medical staff members in pilot and non-pilot county hospitals in Hubei, China, were surveyed. Methods: Questionnaires were used to collect data. The Pearson chi-square statistical method was used to assess the differences between pilot and non-pilot county hospitals and identify the factors related to job satisfaction as well as the understanding and perception of the reform. Binary logistic regression was performed to determine the significant factors that influence the job satisfaction of medical staff in pilot county hospitals. Results: Medical staff members in pilot county hospitals expressed higher satisfaction on current working situation, performance appraisal system, concern showed by leaders, hospital management, and compensation packages (P < 0.05). They were exposed to work-related stress at a higher extent (P < 0.05) and half of them worked overtime. Within pilot county hospitals, less than half of the medical staff members were satisfied with current job and they have evidently less satisfaction on compensation packages and learning and training opportunities. The working hours and work stress were negatively related to the job satisfaction (P < 0.05). Satisfaction on the performance appraisal system, hospital management, compensation packages, and learning and training opportunities were positively related to job satisfaction (P < 0.05). Medical staff in pilot county hospitals exhibited better understanding of and more positive attitude towards the reform (P < 0.05). Conclusions: Pilot county hospitals have implemented some measures through the reform, but there still are deficiencies. The government officials and hospital administrators should pay attention to influencing factors of job satisfaction and focus on the reasonable demands of medical staff. In addition, the medical staff in pilot county hospitals exhibited a better understanding of the public hospital reform programme and showed more firm confidence, but there still were some medical staff members who hold negative attitude. The publicity and education of the public hospital reform still need improvement. Keywords: Medical staff, China, Public hospital reform, Working situation, Satisfaction, Understanding, Perception
    Keywords: Medical staff; China; public hospital reform; working situation; satisfaction; understanding; perception
    JEL: R14 J01
    Date: 2015
  8. By: Mario Holzner (The Vienna Institute for International Economic Studies, wiiw)
    Abstract: Zusammenfassung Aufwind im Westen der MOSOEL In den mittel-, ost- und südosteuropäischen Ländern (MOSOEL) klafft der Ausblick für das Wirtschaftswachstum auch weiterhin auseinander für die meisten der neuen EU-Mitgliedstaaten (NMS) wird eine langsame Beschleunigung des BIP-Wachstums beginnend mit diesem Jahr erwartet. Für 2015 soll das Wachstum durchschnittlich auf 3% ansteigen, um 0,2 Prozentpunkte mehr als im Vorjahr. Die Erholung erfolgt um ein Jahr früher als erwartet. Wesentlicher Faktor ist die bessere Entwicklung in der Eurozone. Auch am Westbalkan wird eine (wenn auch weniger dynamische) Verbesserung der Wachstumsaussichten für die gesamte Prognoseperiode 2015-2017 erwartet. Die wirtschaftliche Entwicklung 2015 in Weißrussland, Kasachstan, Russland und der Ukraine wird düster ausfallen und zum Teil noch schlechter sein als bisher erwartet. Für diese Länder sind die mittelfristigen Wirtschaftsaussichten auch mit substantiellen Risiken behaftet. Insgesamt sollte aber das verstärkte Wachstum in den MOSOEL für die österreichische Wirtschaft als Nachfrageimpuls dienen. Insbesondere die NMS sind für Österreich von zunehmender Bedeutung.   English Summary Western CESEE countries in the ascendant The outlook for GDP growth in the Central, East and Southeast Europe (CESEE) region remains divergent we expect a gradual acceleration of GDP growth for most of the EU’s new Member States (NMS) starting this year. For 2015 growth is expected to increase to 3% on average, by 0.2 pp more as compared to last year. The recovery comes a year earlier than expected mainly based on favourable developments in the euro area. In the Western Balkans growth prospects will also improve over the whole forecast period 2015-2017, though slightly less dynamically. Growth performance in Belarus, Kazakhstan, Russia and Ukraine in 2015, however, will be dismal and partly worse than expected; the medium-term outlook for these countries is also fairly uncertain with considerable downside risks. Overall though, we should expect stronger CESEE growth to act as a demand stimulus for the Austrian economy. The NMS in particular are of increasing importance for Austria.
    Keywords: macroeconomic analysis, international trade, competitiveness, consumption, investment, savings, global financial crisis
    JEL: E20 F34 G01 O52 O57 P24 P27 P33 P52
    Date: 2015–07
  9. By: Piotr Lis (Department of Economic and Local Government Policy, Poznan University of Economics)
    Abstract: The liberalisation of the housing sector, given the macroeconomic stabilisation in the country, influenced the development of a housing loan as a form of financing the purchase of dwellings in Poland, with large growth dynamics of the household debt since the beginning of this century. A growth in financialisation resulted partly from the fact that newly established households preferred in particular the ownership right, especially due to its limited scope in the period of the centrally planned economy. Furthermore, this growth came as a result of the fact that the segment of dwellings for rent – both private and social – did not work well. Significant commodification of dwellings, with a residual character of social housing and marginal private rental, as well as higher social stratification are the features of the contemporary system of provision for housing in Poland. The financialisation of the housing sphere in Poland took place as a result of disparity in interests rates, favourable foreign exchange rate, using housing loans raised in Swiss francs, with growing importance of property developers housing investment mechanism. This process could take place due to the fact that there was no alternative (in relation to commercial banking) finance mechanism which households could use to fund their housing investments, there were delayed regulations and actions introduced by the state as well as an ineffective information policy targeted at the citizens. Consequently, the availability of money and its low, current cost caused a relatively dynamic growth in dwelling prices, despite unfavourable long-term conditions for borrowers (foreign exchange risk, interest rate risk). Reversing the price trend on the housing market resulted in limitations in the availability of housing finance, a growth in the cost of such finance, and consequently a long-lasting limitation to the possibility of satisfying housing needs by a vast group of the society.
    Keywords: housing, housing policy in Poland, system of provision for housing, financialisation of the housing.
    JEL: R21 R28 R31 R38 G12 G21
    Date: 2015–02–01
  10. By: Combes, Jean Louis; Minea, Alexandru; YOGO, Thierry; Mustea, Lavinia
    Abstract: In spite of the rapidly growing research on fiscal multipliers over the recent years, little evidence has been so far accumulated in developing and emerging economies. This paper investigates the nature and the size of fiscal multipliers in Central and Eastern European Countries (CEEC). Unlike most of existing literature, we draw upon a panel vector error correction model, which appropriately captures the common long-term path of CEEC, while allowing for different short-run dynamics, in an integrated setup. Our main results show that the spending multiplier is positive, but low on average. Moreover, its sign,significance and magnitude vary across CEEC. Finally, both impulse and cumulative fiscal multipliers are sensitive to a wide range of CEEC characteristics, including the exchange rate regime, the level of economic development,the fiscal stance, and the openness degree.
    Keywords: Central and Eastern European Countries; fiscal multipliers; panel vector error correction model
    JEL: E6 O1 P35
    Date: 2015–04–31
  11. By: Silvia Bertarelli; Chiara Lodi
    Abstract: This paper provides an empirical analysis about the relationship among innovation, productivity and exporting propensity within manufacturing firms of seven Eastern European Union countries. We analyse marginal effects of product, process and organisational-marketing innovations and test complementarity among them when the objective function is represented by the exporting propensity of a firm. Analysing CIS2008 data, we obtain that productivity improves exporting propensity; the more firms innovate the higher is their exporting probability; complementarity between process and organisational-marketing innovations is accepted in medium high and high technology firms. Complementary innovation strategies are detected for Bulgarian firms, even if Bulgaria is one of the least innovative Eastern European countries.
    Keywords: Propensity to export; Eastern Europe countries; Productivity; Complementarity; Product innovations; Process innovations; Organisational/Marketing innovations
    JEL: F14 O33
    Date: 2015–07–10

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