nep-tra New Economics Papers
on Transition Economics
Issue of 2015‒08‒07
ten papers chosen by
J. David Brown
United States Census Bureau

  1. Trade diversion and high food prices - The impact of the Russian pig meat import ban By Djuric, Ivan; Götz, Linde; Glauben, Thomas
  2. The Economy of People’s Republic of China from 1953 By Anton Cheremukhin; Mikhail Golosov; Sergei Guriev; Aleh Tsyvinski
  3. Is There a City Size Bias? Destination Choice of Rural off-Farm Workers, Evidences from Three Areas in Rural China By Hu, Chaoran; Chen, Kevin Z.; Reardon, Thomas
  4. Bayesian threshold adjustment in spatially integrated wheat markets in Russia By Serebrennikov, Dmytro; Götz, Linde
  5. Outsourcing Agricultural Production: Evidence from Rice Farmers in Zhejiang Province By Guo, Hongdong; Ji, Chen; Jin, Songqing; Huang, Zuhui
  6. Linking apple farmers to markets: Determinants and impacts of marketing contracts in China By Ma, Wanglin; Abdulai, Awudu
  7. A soft pillow for hard times: Effects of economic insecurity on body weight in transitional Russia By Staudigel, Matthias
  8. Unconditional cash transfers in China : an analysis of the rural minimum living standard guarantee program By Golan,Jennifer; Sicular,Terry; Umapathi,Nithin
  9. The Banking Union: State of Art / Unia Bankowa - gdzie jesteœmy By Andrzej Reich; Stefan Kawalec
  10. Инвестиции в агропромышленный комплекс Омской области By Egorova, Yana

  1. By: Djuric, Ivan; Götz, Linde; Glauben, Thomas
    Abstract: In this paper we analyze the impact of the Russian ban on import of pig meat originating in the EU on the domestic pig meat price developments in Russia. We use a regime-switching price transmission model in order to identify possible changes in the long-run equilibrium between the pig meat prices of Russia and its main non-EU trading partners. Our results indicate the reduction of transaction costs in pig meat trade between Russia and its main non-EU trading partners, followed by the increase in transmission of price changes in the long-run. Though, our results indicate completely opposite results concerning domestic price relations between wholesale and end consumer pig meat prices in Russia. Overall, faced with the scarcity of pig meat on the domestic market, Russian consumers bear the biggest burden from the ban in the medium term by being faced with the significant increase in end consumer pig meat prices.
    Keywords: import ban, pig meat, price transmission, Russia, Agribusiness, Agricultural and Food Policy, Demand and Price Analysis, Food Security and Poverty, International Relations/Trade, C22, I31, P22, Q11, Q17, Q18,
    Date: 2015
  2. By: Anton Cheremukhin; Mikhail Golosov; Sergei Guriev; Aleh Tsyvinski
    Abstract: This paper studies growth and structural transformation of the Chinese economy from 1953 to 2012 through a lens of a two-sector growth model. The main goal of the paper is to provide a systematic analysis of both the pre-1978 reform and post-1978 reform periods in a unified framework. First, we construct a dataset that allows the application of the neoclassical model and computation of wedges, their components, and rates of TFP growth. Second, we determine the key quantitative factors behind growth and structural transformation. The changes in the intersectoral labor wedge play the dominant role in accounting for the change in the share of labor force in agriculture. TFP growth and changes in the intersectoral wedges are the two most significant factors contributing to GDP growth. Further decomposing the effects of reduction in wedges, we find that two components: the production component (the gap between the ratio of the marginal products of labor and relative wages) and the consumption component (the gap between the marginal rate of substitution and the relative prices) play a particularly large role. Third, we use the pre-reform period as a key benchmark to measure the success of the post-1978 reforms. We show that reforms yielded a significant growth and structural transformation differential. GDP growth is 4.2 percentage points higher and the share of the labor force in agriculture is 23.9 percentage points lower compared with the continuation of the pre-1978 policies. We provide extensive historical evidence for the reforms that are consistent with the evolution of the components of the wedges. The decrease in the production component of the intersectoral wedge is consistent with increased competition and demonopolization of the economy. The decrease in the consumption component of the wedge is consistent with the price and housing reforms. Finally, we project the path of the Chinese economy until 2050 and also calculate a lower bound on future growth by projecting pre-reform trends.
    JEL: N1 N55 O11 O14 O2 O41 P2
    Date: 2015–07
  3. By: Hu, Chaoran; Chen, Kevin Z.; Reardon, Thomas
    Abstract: Nonfarm activities (NFA) are a crucial component of the livelihood strategies of China’s rural households. Empirical evidence shows that 51% of rural households’ income in Asia is from nonfarm earnings (Haggblade, Hazell and Reardon 2007). However, the increasingly uneven spatial distribution of these nonfarm economies has raised the concerns in many countries. It is found that rural towns or intermediate cities play the more important roles in rural poverty reduction than big cities (Berdegué et al. 2015), yet, we still see more migrants concentrating in urban big cities in China. To explore this paradoxical situation will provide some evidences for other developing countries experiencing rapid yet unbalanced urbanization. In this paper, we used a unique data set to find out what are the factors driving rural migrant’s destination choice and whether they are always attracted by large cities. Apart from this main research question, several other contributions are made to the literature. First, this paper performs pioneer research by conducting the estimation of the determinants of Chinese rural off-farm worker’s locational choice, including and comparing both local and migratory NFA, both of which are important among rural households in China, yet the former is generally ignored in the literature. Second, the Nested-Logit Model is used to relax the irrelevant alternatives assumption, proved to be inappropriate if directly adopted traditional Logit or Multinomial Logit model in our case. The results suggested the importance of transportation as well as education to attract rural migrants. We did not see rural migrants preferring larger cities while facing with decreasing travel distances. For rural nonfarm economy, it is also important to improve agricultural performance in rural areas to generate multiplier effects as well as providing education/trainings to rural off-farm workers to be involved in higher-skilled NFA.
    Keywords: Rural Nonfarm, Migration, Destination choice, Nested Logit Model, China, Agricultural and Food Policy, Community/Rural/Urban Development, International Development, Labor and Human Capital,
    Date: 2015
  4. By: Serebrennikov, Dmytro; Götz, Linde
    Abstract: This paper studies spatial price transmission and integration of regional domestic wheat markets in Russia. An innovative approach to threshold estimation is applied to better capture model non-linearities associated with transaction costs and policy measures. The results show critical importance of distance that determines the speed at which price shocks are transmitted between the regional markets. Additionally, it is shown that the export ban for wheat in 2010/11 led to trade activation and faster price transmission inside the country. The effect of export ban was found to be enhanced by transport subsidies introduced to facilitate the distribution of grain in the wake of severe drought in certain production areas.
    Keywords: Price transmission, market integration, threshold adjustment, non-linear econometrics, Agricultural and Food Policy, Demand and Price Analysis, Marketing,
    Date: 2015
  5. By: Guo, Hongdong; Ji, Chen; Jin, Songqing; Huang, Zuhui
    Abstract: China has recorded positive grain production growth rates for the past eleven consecutive years. This is a remarkable achievement given that China’s rapid industrialization and urbanization has led to a vast reduction of arable land and agricultural labor to non-agricultural sectors. While there are many factors contributing to this happy outcome of China’s grain production, one contributing factor that has begun to receive increasing attention is the emergence of agricultural outsourcing, a new rural institution that has emerged in recent years. This study aims to contribute to the limited but growing literature on agricultural outsourcing in China. Specifically, this study analyzes factors affecting farmers’ decisions to outsource any or some production tasks using data from rice farmers in Zhejiang province. Results from a logistic model show that farm size, prices, and government subsidy encourage farmers to outsource while ownership of agricultural machines and land fragmentation have negative effects on farmers decisions to outsource any task. Results also showed that determinants of outsourcing decisions vary with the production tasks that farmers outsourced.
    Keywords: Determinants, agricultural outsourcing, rice farmers, Zhejiang Province, China, Crop Production/Industries, Production Economics, D24, O12, O13,
    Date: 2015–06
  6. By: Ma, Wanglin; Abdulai, Awudu
    Abstract: This study investigates the determinants of marketing contract choices and the related impact on farm net returns of apple farmers in China. We employ a two-stage selection correction approach (BFG) for the multinomial logit model. On the basis of the BFG estimation, we also use an endogenous switching regression model and a propensity score matching technique to estimate the causal effects of marketing contract choices on net returns. The empirical results reveal that written contracts increase apple Farmers’ net returns,while oral contracts exert an opposite impact.
    Keywords: Marketing Contracts, Multinomial Logit, Selectivity Correction, China, Agricultural and Food Policy, International Development, Marketing, C52, Q13,
    Date: 2015
  7. By: Staudigel, Matthias
    Abstract: Recent literature has identified increasing economic insecurity as a possible explanation for globally increasing obesity rates. This study investigates the causal effect of economic insecurity on weight outcomes in transitional Russia. Using data from the Russia Longitudinal Monitoring Survey from 1994 to 2005 I construct several cumulative measures of economic insecurity and estimate their impact on Body Mass Index and waist circumference. I apply instrumental-variables methods to control for reverse causality and unobserved heterogeneity. Results show a mixed picture with both positive and negative effects of insecurity on weight and waist circumference, depending on the economic insecurity measure. Additional regressions on subjective statements of anxiety highlight the importance of examining the pathway from objective insecurity over subjective anxiety and behavior to final health and weight outcomes in more detail.
    Keywords: Insecurity, obesity, Russia, instrumental variables, RLMS, Agricultural and Food Policy, Consumer/Household Economics, Food Consumption/Nutrition/Food Safety, Food Security and Poverty, Health Economics and Policy, D01, C26, I14,
    Date: 2015
  8. By: Golan,Jennifer; Sicular,Terry; Umapathi,Nithin
    Abstract: This paper examines China?s rural minimum living standard guarantee (dibao) program, one of the largest minimum income cash transfer schemes in the world. Using household survey data matched with published administrative data, the paper describes the dibao program, estimates the program?s impact on poverty, and carries out targeting analysis. The analysis finds that the program provides sufficient income to poor beneficiaries but does not substantially reduce the overall level of poverty, in part because the number of beneficiaries is small relative to the number of poor. Conventional targeting analysis reveals rather large inclusionary and exclusionary targeting errors; propensity score targeting analysis yields smaller but still large targeting errors. Simulations of possible reforms to the dibao program indicate that expanding coverage can potentially yield greater poverty reduction than increasing transfer amounts. In addition, replacing locally diverse dibao lines with a nationally uniform dibao threshold could in theory reduce poverty. The potential gains in poverty reduction, however, depend on the effectiveness of targeting.
    Keywords: Poverty Monitoring&Analysis,Regional Economic Development,Services&Transfers to Poor,Rural Poverty Reduction
    Date: 2015–07–21
  9. By: Andrzej Reich; Stefan Kawalec
    Abstract: The first aim of this paper is to describe the main developments in the Ukrainian economy since its independence in 1991, focusing on the evolution of output, and the path of economic reforms — that is, to simply show what happened. The bottom line on that is well known: Ukraine’s economy performed very poorly, and its reforms moved quite slowly, lagging behind most of Central Europe and the Baltic, and even behind some FSU (Former Soviet Union) countries. This first task is a relatively easy one, though some measurement issues do need discussion. In comparison, the second aim — explaining why it happened, identifying the explanatory, causal factors — is much more difficult and contentious. Indeed, causation here means two dynamics: the relationship between performance and reform pace, and the underlying determinants of the slow reforms. The paper’s main effort will be to argue and present evidence that the poor economic performance is primarily due to the late and slow start on economic reforms. However, it only begins to point to the explanations for slow reforms and suggest a modeling approach to analyze this econometrically in future work. It is widely believed that the creation of the banking union initiated the integration of the EU banking market. The process is traced back to June 2012 (EU Summit decided to create the banking union), 4 November 2013 (effective date of the Banking Union Regulation), or 4 November 2014 (operational launch of the Single Supervisory Mechanism, SSM). However, the integration of the EU banking market began much earlier and the creation of the banking union should be considered the final rather than the initial step in the process. In fact, the integration began as early as 1990s with the introduction of the single passport which allows a bank licensed in one member state to operate across the European Union through branches in other member states.The solution was devised mainly for banks licensed in one member state and operating in another member state on a small scale, rendering the establishment of a subsidiary bank uneconomical. This practical facilitation was creatively exploited by the largest European banks, which effectively transformed the EU banking market. Doœæ powszechnie uwa¿a siê, ¿e utworzenie unii bankowej zapocz¹tkowa³o integracjê unijnego rynku bankowego. Jako pocz¹tek tego procesu wskazuje siê czerwiec 2012 roku (Szczyt UE, podczas którego zapad?a decyzja na temat tworzenia unii bankowej), 4 listopada 2013 roku (wejœcie w ¿ycie rozporz¹dzenia w sprawie utworzenia unii bankowej), czy wreszcie 4 listopada 2014 roku (pocz¹tek dzia³alnoœci operacyjnej jednolitego mechanizmu nadzorczego (Single Supervisory Mechanism — SSM)). Jednak integracja unijnego rynku bankowego zaczê³a siê znacznie wczeœniej, a utworzenie unii bankowej nale¿y postrzegaæ jako koñcow¹ fazê tego procesu, a nie pocz¹tkow¹. Proces integracji rozpocz¹³ siê na pocz¹tku lat dziewiêædziesi¹tych ubieg³ego wieku, wraz z wprowadzeniem tak zwanej zasady jednolitego paszportu (single passport), zgodnie z któr¹ bank licencjonowany w jednym kraju cz³onkowskim, na podstawie tej¿e licencji, uzyska³ prawo prowadzenia dzia³alnoœci na terenie ca³ej Unii Europejskiej, poprzez oddzia³y, które móg³ otwieraæ w innych krajach cz³onkowskich. Takie rozwi¹zanie wprowadzone g³ównie z myœl¹ o banku licencjonowanym w jednym kraju cz³onkowskim, prowadz¹cym dzia³alnoœæ w innym kraju cz?onkowskim, ale w tak ma³ej skali, ¿e uruchamianie w tym celu banku zale¿nego nie by³oby uzasadnione ekonomicznie. To sensowne u³atwienie zosta³o twórczo rozwiniête przez najwiêksze banki europejskie, skutecznie przeobra¿aj¹c rynek bankowy w Unii Europejskiej.
    Keywords: European Union, banking supervision, EBC, EBA, banking union, SSM
    JEL: N14 E5 E58 G21 G2 G28
    Date: 2015–06
  10. By: Egorova, Yana
    Abstract: Due to the unstable economic situation in the region, the Government of the Omsk region designated one of the priority directions of stabilization of economy - development of agrarian and industrial complex of the Omsk region. One of solutions of this task is involvement of investors who could make financial means in the enterprises of the Omsk region. This research is urged to find out how the Government of the Omsk region promotes development of agrarian and industrial complex, creating necessary conditions for investors, to track dynamics of development of agrarian and industrial complex and to analyse negative and positive sides of agrarian and industrial complex which potential investors can face.
    Keywords: agro-industrial complex, agrocluster, investments, economy, Omsk region
    JEL: A1 Q1
    Date: 2015–07–29

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