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on Transition Economics |
| By: | Paul Castaneda Dower (Florida International University); Egor Malkov (University of Minnesota); Leonid Polishchuk (National Research University Higher School of Economics); William Pyle (Middlebury College) |
| Abstract: | Private ownership confers numerous benefits, including stronger performance incentives, better use of privately owned assets, and improved access to finance. We argue that privately owned land could be both an asset and a liability, and overall net benefits of land ownership are contingent on the quality of surrounding institutions. We present a simple model and empirical evidence based on the Business Environment and Enterprise Performance Survey (BEEPS) in Russia, which clearly demonstrates such conditionality in the case of land ownership by Russian industrial firms. Consistently with earlier literature, land ownership facilitates firms’ access to finance (the “de Soto effect”), but at the same time entails additional risks and obstacles to doing business. When the quality of property rights protection and other key institutions is poor, land ownership could have an adverse effect on firms’ performance |
| Keywords: | de Soto effect, land ownership, property rights, privatization, institutional complementarity |
| JEL: | D23 O17 Q15 R14 R52 |
| Date: | 2015 |
| URL: | http://d.repec.org/n?u=RePEc:hig:wpaper:107/ec/2015&r=tra |
| By: | Klyachko, Tatiana (Russian Presidential Academy of National Economy and Public Administration (RANEPA)); Beliakov, Sergei (Government of the Russian Federation - Russian Ministry of General and Professional Education) |
| Abstract: | The paper focuses on the development of methodology fro assessment of the contribution of education in the socio-economic development of the constituents of the Russian Federation. Author proposed two approaches to the assesstemt of the contribution of education to the socio-economic development of Russian regions: on the basis of salary bonus for the level of education and on the basis of salary differentiated according to employers age. |
| Keywords: | Russian economy, education, educational reform |
| JEL: | I21 I22 I23 I24 I25 I28 |
| Date: | 2015–09–07 |
| URL: | http://d.repec.org/n?u=RePEc:rnp:ppaper:dok12&r=tra |
| By: | Olegs Krasnopjorovs (Bank of Latvia) |
| Abstract: | We employ EU-SILC micro data for Latvia to study how returns to education have changed during the economic crisis of 2008–2009 and afterwards. We found that returns to education increased significantly during the crisis and decreased slightly during the subsequent economic recovery. The counter-cyclical effect of education on wages was particularly strong for males; it was evident in majority of sectors and all age groups (except youth, for citizens of Latvia, resident non-citizens and other country citizens as well as in all regions of the country, particularly outside the capital city region. The share of career component (better access to higher paid occupations, sectors and positions) in the Mincer coefficient remained broadly constant over time. After the crisis, education became even more associated with a longer working week and higher chances to be employed. Furthermore, we show that returns to education in Latvia are generally higher in the capital city and its suburbs than outside the capital city region, for citizens of Latvia than for resident non-citizens and citizens of other countries, but lower for males and young people. Wage differential models reveal a relatively large wage premium for higher education and rather small for secondary education. In line with the previous findings for other countries, the estimates obtained with instrumental variable models significantly exceed the Mincer coefficient. |
| Keywords: | returns to education, Mincer coefficient, wage differentials model, higher education wage premium, instrumental variables |
| JEL: | J31 |
| Date: | 2015–11–10 |
| URL: | http://d.repec.org/n?u=RePEc:ltv:wpaper:201503&r=tra |
| By: | Bernadette Biatour; Chantal Kegels |
| Abstract: | The paper analyses the long-term trend of Belgian economic growth and the more recent evolution of labour productivity including the impact of the crisis. It identifies the causes of declining trend of productivity gains by analysing the structural changes in the economy and by applying the growth accounting methodology on industry-level data. Finally, possible policy actions are detailed which minimise the negative short term impact on aggregate demand while maximising the positive effect on labour productivity growth. |
| JEL: | C82 D24 O11 O33 O47 |
| Date: | 2015–10–02 |
| URL: | http://d.repec.org/n?u=RePEc:fpb:wpaper:1506&r=tra |
| By: | Myrto Kalouptsidi (Princeton University) |
| Abstract: | In recent years, Chinese firms have rapidly dominated a number of capital intensive industries (steel, solar panels, shipbuilding) in world markets. At the same time, China's domestic industries are fragmented: on one hand, there is substantial regional industrial duplication due to China's decentralized bureaucracy; on the other hand, even within provinces, these industries tend to be characterized by a large number of small firms. In this paper, we study the role that industrial policy has played in China's (fragmented) industrial takeover. We first document and measure the support provided by Chinese provincial governments. We then ask what their impact is on global (mis)allocation and welfare. We explore the unintended consequences of provincial competition driven by non-market based policy instruments, such as excess capital expansion. Finally, we study the consequences of consolidation policies brought forward by the central government. |
| Date: | 2015 |
| URL: | http://d.repec.org/n?u=RePEc:red:sed015:1247&r=tra |
| By: | Böhm, Sebastian |
| Abstract: | The massive movement of capital and labor in opposite directions is the most striking characteristic of economic integration of Eastern and Western Germany. Beyond that, wage-setting behavior during the early years of unification and massive public social transfers have affected the transition path of the Eastern economy. In this paper, I set up a two-region open economy model with capital and labor mobility, wage-setting behavior, and public social transfers to explain major empirical trends of the German integration episode. I show that the model is able to replicate aggregate migration pattern in unified Germany and that wage-setting behavior has delayed labor productivity convergence between both German regions, whereas public social transfers have reduced the effect of wage setting on East-West net migration. |
| Keywords: | Economic Integration; German Reunification; Capital Mobility; Migration |
| JEL: | F20 E60 H20 J61 |
| Date: | 2015–11–09 |
| URL: | http://d.repec.org/n?u=RePEc:fri:fribow:fribow00463&r=tra |
| By: | Haradinova, Anelia; Ivanova, Daniela; Vasileva, Elka |
| Abstract: | The economic activities and the ever-increasing needs for resources put the world in a position to discover urgently a path towards sustainable development. To achieve this aim the environmental policies and innovative approaches are crucial. Eco-innovations are key element in EU sustainable growth strategy. Based on that, the report reviews and evaluates the activities of the Bulgarian SMEs in the development and implementation of new innovative technologies in the last 3 years based on the results of a survey among 135 companies with working environment management system under ISO 14001 or EMAS. |
| Keywords: | eco-innovations, Environmental management system, Bulgaria |
| JEL: | M10 Q59 |
| Date: | 2015–06–04 |
| URL: | http://d.repec.org/n?u=RePEc:pra:mprapa:67700&r=tra |
| By: | Veronika Belousova (National Research University Higher School of Economics); Nikolay Chichkanov (National Research University Higher School of Economics) |
| Abstract: | With the appearance of high tech mobile devices, mobile banking penetration has been revealed over the world. However, rates of payments that are made through mobile banking apps still much lower than through other channels. The paper aims at observing main incentives to use mobile banking in Russia by users of smartphones and tablets. This empirical model modifies the previous one proposed by Belousova & Chichkanov (2015) to find the relationship between the intention to use mobile banking and newly added factors like perceived financial costs and social influence as indirect influence of self-efficacy and compatibility with lifestyle. Like in the baseline study, Partial Least Squares Structural Equation Modelling (PLS-SEM) approach is used to check the existence of such a relation. The paper finds that the most powerful chain of incentives is «self-efficacy»-«perceived efforts»-«perceived usefulness»-«intention to use». The influence of perceived financial costs are also meaningful. However, perceived risks, compatibility with lifestyle and social influence do not have any significant relationship with the intention to use mobile banking. The lack of generalisability may be driven by the chosen focus group. In addition, the distinction between the dependent variable «intention to use» and real usage might be also considered as a limitation of the study. However, these results can be used by financial institutions that develop the strategy of providing banking services through the mobile channel. It may help to involve target group of clients and modify the product line |
| Keywords: | remote banking services; innovations; mobile banking; PLS-SEM; acceptance of technology; user adoption and behavioral intention; perceived usefulness. |
| JEL: | D12 G21 L86 |
| Date: | 2015 |
| URL: | http://d.repec.org/n?u=RePEc:hig:wpaper:48sti2015&r=tra |
| By: | Li, Kui-Wai |
| Abstract: | After nearly four decades of rapid growth, the China economy is faced with various challenges. The 2008 crisis would have served as the last straw as China experienced falls and volatilities in industrial output, export and foreign direct investment. The new policy focuses on expansion of domestic consumption and rebalancing. Given the unreliability of Chinese products, there is a need to rebuild product acceptability and market confidence. The structure of industrial enterprises, especially the small- and medium-sized enterprises, will play a crucial role in the next phase of development in the China economy. This paper uses the data on Chinese industrial enterprises to estimate the productivity performance of enterprises across region and industries. The discussion is placed on the impact of the 2008 financial crisis on the China economy and industries enterprises. By using a simple methodology and OLS regression analysis on the estimation of total factor productivity, the empirical results show that SMEs and non-SMEs do perform differently in different industries and across regions, but SMEs suffered more than non-SMEs since the 2008 crisis. |
| Keywords: | China regions, small- and medium-sized enterprises, total factor productivity, industrial enterprises |
| JEL: | O4 O53 |
| Date: | 2015–11–21 |
| URL: | http://d.repec.org/n?u=RePEc:pra:mprapa:67844&r=tra |
| By: | Sokolov, Ilya (Russian Presidential Academy of National Economy and Public Administration (RANEPA)) |
| Abstract: | Over the last decade, the Russian Government is persistently heading for a transition to the strategic governance and shifting of the budgetary system of all levels of government to the long term planning cycle which should contribute to the higher predictability of the budgetary policy and correspondingly to the formation of conditions for sustainable economic development of the country. |
| Keywords: | Russian economy, budgetary policy, strategic planning, long term planning, sustainable development |
| JEL: | H6 H7 |
| Date: | 2015–09–18 |
| URL: | http://d.repec.org/n?u=RePEc:rnp:ppaper:dok1&r=tra |
| By: | Danica Unevska-Andonova (National Bank of the Republic of Macedonia); Dijana Janevska-Stefanova (National Bank of the Republic of Macedonia) |
| Abstract: | In the analysis of public and external debt sustainability the National Bank of the Republic of Macedonia is actively using the IMF’s Debt Sustainability Analysis (DSA) framework. The aim of our analysis is to improve the analytical power of the IMF’s DSA framework, in the case of Macedonia. This paper uses simple framework, based on methodology used in Adler and Sosa (2013), that integrates econometric estimates of the effect of global factors on key domestic variables that determine public and external debt dynamics, within the IMF‘s standard debt sustainability framework. VAR estimation is used in obtaining the forecasts of key domestic variables, conditional on a set of assumed global variables under different global shock scenarios. The results in general suggest that under all shock scenarios, there is negative effect to domestic GDP, however in the case of current account there is negative effect in the beginning of the period of applied shocks, but positive in the later period. Consequently, the expected effect to public debt sustainability is negative for the whole period due to lower real GDP growth. However, regarding external debt sustainability, negative effect is expected in the first year or two due to lower GDP growth and higher current account deficit, yet, in a medium run, external sustainability might not be jeopardized as the lower GDP growth might be neutralized by the lower current account deficit. |
| Keywords: | public debt, external debt, debt sustainability, Macedonia |
| JEL: | C32 E60 F42 F47 |
| Date: | 2015–10 |
| URL: | http://d.repec.org/n?u=RePEc:mae:wpaper:2015-10&r=tra |
| By: | Vrh, Nataša |
| Abstract: | The phenomenon of global value chains highlighted the issue of domestic value-added in exports (DVA) and led to the development of alternative trade measures in value-added terms. These, inter alia, enabled an estimation that shows that New EU countries from Central and Eastern Europe (NMS-10) experience an approximately 5 percentage points lower DVA share as compared to old EU countries (EU-15). The lag is on average the highest in knowledge-intensive manufacturing sectors (8 percentage points) and the lowest in knowledge-intensive services (0.3 percentage points). However, this paper follows the assumption that NMS-10 have acquired new knowledge by participating in Global Value Chains (GVCs), and thus gradually started increasing their DVA. Based on the empirical application of the EU trade data, I found that convergence in terms of DVA in exports can be observed in manufacturing, and especially in the services sectors. Additionally, I find that for NMS-10 countries negative relationship between participation in GVCs and DVA in exports is slightly decreasing over time in both sectors. |
| Keywords: | global value chains, international trade, value added in exports |
| JEL: | C67 F02 F14 |
| Date: | 2015–11 |
| URL: | http://d.repec.org/n?u=RePEc:pra:mprapa:67805&r=tra |
| By: | Neven Vidakovic (Effectus - University Collage for Law and Finance) |
| Abstract: | The present paper looks at the impact of exchange rate regime and a household’s choice of debt. One of the characteristics of economic transition in eastern European countries has been an increase in overall debt holding. Standard economic theory assumes the relationship S=I. According to this relationship, households should use debt only to purchase durable goods; however, in some eastern European countries, there has been a large increase in consumer loans, economic behavior not recognized under the standard no-Ponzi scheme assumption of economic models. This paper aims to investigate the case when debt is used to live above a household’s standard budget constraint. Our model shows that the significant impact on the choice of the amount the debt households are willing to hold is due to the choice of the exchange rate regime made by the central bank. The model investigates a household’s behavior in two main cases: a stable exchange rate regime (exchange rate regime with FX risk) and a variable exchange rate regime (exchange rate regime without exchange rate risk). Households make different choices under alternative exchange rate regimes; this pattern of behavior is presented in the model and verified by the data. |
| Keywords: | credit, exchange rate, dynamic programming |
| JEL: | E51 C61 E58 |
| Date: | 2015–11 |
| URL: | http://d.repec.org/n?u=RePEc:eff:wpaper:0001&r=tra |
| By: | Tuyara Gavrilyeva |
| Abstract: | It is known that cities are the engines of growth of the modern economy and society. Herewith we highlight the national and regional characteristics of urbanization as a global process. Somewhere the urbanization is stimulated, in China for example, somewhere it is limited, as we see in Russia. But it is a long-term trend, which will qualitatively change the life of humanity in the 21st century. There is a special interest in the comparative analysis of models of development in the northern cities of the world and Russia. They all have growth restrictions, such as the environment, the demographic capacity of the area, the high level of technological hazards. Thus, many have similar conditions: - Located near the water (sea and river), respectively, these are ports; - There is a highly developed transport infrastructure, including bridges; - The population is small; - Most are the educational and research centers; - Most are the administrative centres of the province (region), metropolises. In contrast to the sustainable state of the northern cities in Europe and America, where the dynamics of the main indicators remain stable for a long time, the state of the cities in the Russian North is differentiated. Yakutsk is the biggest city in terms of population, located in the permafrost zone. Now it is one of the fastest growing cities in the world. Over the past 15 years, the population of the city increased by 50%, from 195.4 thousand people in 2000 to 294.2 thousand people in 2014. In contrast, the other cities of the North of Russia (Norilsk, Vorkuta and Magadan) show population decline, deterioration of the economic situation. Fast growth, as well as a rapid decline, entail an increase in social risks. In addition, growth is also accompanied by an increase in technological and environmental risks. Currently, the most pressing issues for Yakutsk are: - Lack of social, communal and engineering infrastructure, poor quality of the land improvement. - Poverty of the population due to the weak labor market. - Growth of social tensions by reason of no high-quality social services and the emergence of wealth (income) limit for access to quality services. - Increase of anthropogenic pressure on the environment. - High costs on production. Yakutsk needs to shape its own, unique in many respects model of sustainable development, which should absorb world experience as well as its own properties. Development of the city is largely determined by quality management decisions and research projects. |
| Date: | 2015–10 |
| URL: | http://d.repec.org/n?u=RePEc:wiw:wiwrsa:ersa15p1719&r=tra |
| By: | Maleva, Tatyana Mikhailovna (Russian Presidential Academy of National Economy and Public Administration (RANEPA)); Avraamova, Elena M. (Russian Presidential Academy of National Economy and Public Administration (RANEPA)) |
| Abstract: | This paper was drafted on the basis of the study "The growth potential of the economic activity of the population, the social dynamics of the population and the risks of difficult life situations," conducted by the Institute for Social Analysis and Forecasting RANEPA in 2014. The aim of the study was to identify barriers and the growth prospects of the economically active population. Information base of research - a survey of 4800 respondents in three Russian regions with different levels of socio-economic status. The paper identified resource characteristics affecting the economically active population, revealed values ??of the factors that determine its growth or, conversely, braking, and also found a link resource potential of households with wealth. |
| Keywords: | Russian economy, economic activity, growth potential |
| JEL: | J21 J22 J23 J24 |
| Date: | 2015 |
| URL: | http://d.repec.org/n?u=RePEc:rnp:ppaper:dok20&r=tra |
| By: | Magdalena Petrovska (National Bank of the Republic of Macedonia); Ljupka Georgievska (National Bank of the Republic of Macedonia) |
| Abstract: | This paper applies a SVAR model which combines different monetary policy instruments to construct an alternative indicator of monetary policy stance in Macedonia. It employs the approach introduced by Bernanke and Mihov (1998) of isolating monetary policy shocks from the whole set of monetary policy instruments that otherwise react to real developments. The residuals from such VAR are cleaned from the central bank’s reaction function and represent true monetary policy innovations. Furthermore, we solve the interdependence among different monetary policy instruments contained in the residuals by developing a structural model. We use the model to extract unanticipated policy stance, as an alternative view on the monetary policy. |
| Keywords: | SVAR, Monetary policy stance, Monetary framework |
| JEL: | E50 E52 |
| Date: | 2015–07 |
| URL: | http://d.repec.org/n?u=RePEc:mae:wpaper:2015-07&r=tra |
| By: | Konstantins Benkovskis (Bank of Latvia); Santa Berzina (Bank of Latvia); Liva Zorgenfreija (Bank of Latvia) |
| Abstract: | We use an anonymised firm-level trade database provided by the CSB to evaluate Latvia's re-exports. We obtain estimates of re-export flows and the corresponding re-export mark-ups by solving a linear maximisation problem for each firm-product pair. We find that the share of re-export flows in the total merchandise exports and imports is significant and follows an increasing trend. The share of re-exports is especially important in product groups, such as transport vehicles, plastics, mineral products, as well as machinery and electrical equipment. The majority of re-export flows is directed to Latvia's closest neighbours Lithuania and Estonia, suggesting that the country serves as a sort of a regional transport hub. We also find that the average re-export mark-ups were sizeable allowing us to conclude that re-export operations may also provide an important contribution to Latvia's GDP. |
| Keywords: | re-exports, firm-level data, Latvia, simplex |
| JEL: | D22 F14 |
| Date: | 2015–11–09 |
| URL: | http://d.repec.org/n?u=RePEc:ltv:dpaper:201503&r=tra |
| By: | William Barnett (Department of Economics, The University of Kansas; Center for Financial Stability, New York City; IC2 Institute, University of Texas at Austin); Biyan Tang (Department of Economics, The University of Kansas;) |
| Abstract: | Since China’s enactment of the Reform and Opening-Up policy in 1978, China has become one of the world’s fastest growing economies, with an annual GDP growth rate exceeding 10% between 1978 and 2008. But in 2015, Chinese GDP grew at 7 %, the lowest rate in five years. Many corporations complain that the borrowing cost of capital is too high. This paper constructs Chinese Divisia monetary aggregates M1 and M2, and, for the first time, constructs the broader Chinese monetary aggregates, M3 and M4. Those broader aggregates have never before been constructed for China, either as simple-sum or Divisia. The results shed light on the current Chinese monetary situation and the increased borrowing cost of money. GDP data are published only quarterly and with a substantial lag, while many monetary and financial decisions are made at a higher frequency. GDP nowcasting can evaluate the current month’s GDP growth rate, given the available economic data up to the point at which the nowcasting is conducted. Therefore, nowcasting GDP has become an increasingly important task for central banks. This paper nowcasts Chinese monthly GDP growth rate using a dynamic factor model, incorporating as indicators the Divisia monetary aggregate indexes, Divisia M1 and M2 along with additional information from a large panel of other relevant time series data. The results show that Divisia monetary aggregates contain more indicator information than the simple sum aggregates, and thereby help the factor model produce the best available nowcasting results. In addition, our results demonstrate that China’s economy experienced a regime switch or structure break in 2012, which a Chow test confirmed the regime switch. Before and after the regime switch, the factor models performed differently. We conclude that different nowcasting models should be used during the two regimes. |
| Keywords: | China, Divisia Monetary Index, Borrowing Cost of Money, Nowcasting, Real GDP Growth Rate, Dynamic Factor Model, Regime Switch |
| JEL: | C32 C38 C43 E47 E51 O53 |
| Date: | 2015–11 |
| URL: | http://d.repec.org/n?u=RePEc:kan:wpaper:201506&r=tra |
| By: | Jardon Carlos (University of Vigo); Molodchik A. Mariya (National Research University Higher School of Economics) |
| Abstract: | The paper explores the relationship between different types of intangible resources and phases of the internationalization in the context of emerging economies. The Uppsala model is applied to build internationalization index considering export, import and investment activities. The database of more than 2000 Russian companies is used to test the hypotheses put forward. The findings reveal that relational capital has significant positive impact on each stage of internationalization; organizational capital improves internationalization except the last stage of being multinational. Contrary to our expectations human capital has no direct impact on internationalization; notwithstanding it has positive effect on relational and structural capital |
| Keywords: | internationalization, internationalization index, Uppsala model, intangible resources, emerging markets, Russian companies, relational capital, structural capital, human capital, regression analysis |
| JEL: | Z |
| Date: | 2015 |
| URL: | http://d.repec.org/n?u=RePEc:hig:wpaper:22/ir/2015&r=tra |
| By: | Beleva, Iskra |
| Abstract: | This study aims to present the recent active labour market policies for encouraging labour market participation and increasing labour productivity. It points out that a number of different programs and labour market measures have been implemented in Bulgaria in the last twenty years. The achievements of the analysis point out both positive and negative features. The programs contribute for increasing labour market inclusion and employment participation in a short run and this is the main positive effect. However, the lack of consistence and sustainability of employment occurred as negative features. The study outlines the effect of "Human Resource Development" Program, conducted in Bulgaria in the period 2007-2013, on labour market development and labour inclusion and productivity, in particular. It employs different quantities and qualities indicators to present the achievements of a total of EUR 402,4 millions, allocated for encouraging economic activity for increasing labour productivity. In conclusion the study outlines the positive effects and some negatives of the conducted policies and draws out recommendations for improvements. |
| Keywords: | labour market policy, employment, economic activity, labour productivity, assessment, efficiency |
| JEL: | J45 J48 |
| Date: | 2015 |
| URL: | http://d.repec.org/n?u=RePEc:pra:mprapa:67826&r=tra |
| By: | Pavla Klepková Vodová (Department of Finance and Accounting, School of Business Administration, Silesian University); Daniel Stavárek (Department of Finance and Accounting, School of Business Administration, Silesian University) |
| Abstract: | The aim of this paper is to find out the worst-case scenario for individual banks from the Czech and Slovak banking sector and to find out determinants of their sensitivity to the bank run. The data cover the period from 2000 to 2014. Although bank liquidity measured by the liquid asset ratio has decreased in both countries during the analyzed period, Czech banks were more liquid and better prepared for a potential bank run. With the use of panel data regression analysis, we tested seven bank specific factors and seven macroeconomic factors. The sensitivity of Czech and Slovak banks to the possible bank run is determined by bank profitability. Among macroeconomic factors, interest rate and unemployment rate matter. However, the most important is the level of bank liquidity: banks with sufficient buffer of liquid assets are safer than other banks, mainly in periods of financial distress. |
| Keywords: | bank run, liquid asset ratio, scenario analysis, panel data regression analysis |
| JEL: | C23 G01 G21 |
| Date: | 2015–11–09 |
| URL: | http://d.repec.org/n?u=RePEc:opa:wpaper:0020&r=tra |
| By: | Amankwah-Amoah, Joseph; Zhang, Hongxu |
| Abstract: | In spite of a growing body of literature on business failures in China and effects of government policy, our understanding of the current state of knowledge remains unclear. The study advances research on the subject by developing the “four-parties” framework to review and synthesise the literature. The paper lays the groundwork for an integrated understanding of the causes and consequences of business failure. In sharp contrast with the evolution and development of Western-based business failure research, much of the literature on China and Chinese firms has focused largely on business failure prediction models by bypassing the traditional evolution from qualitative case study/story approaches to quantitative-based approaches. The study outlines the important implications and promising avenues for future research. |
| Keywords: | Business failure; China; emerging issues |
| JEL: | M0 M2 O2 O25 |
| Date: | 2015 |
| URL: | http://d.repec.org/n?u=RePEc:pra:mprapa:67848&r=tra |
| By: | Ahmet Sensoy; Veysel Eraslan; Mutahhar Erturk |
| Abstract: | This study investigates whether sovereign credit rating, outlook and watch announcements (from Fitch, Moody’s and Standard & Poor’s) for eleven emerging countries, namely Poland, Czech Republic, Hungary, Slovakia, Croatia, Lithuania, Latvia, Estonia, Romania, Bulgaria, and Turkey have a significant effect on pair-wise correlations between the stock market returns. Daily closing prices of the benchmark stock market indices of aforementioned countries are considered from the end of October 2000 to the end of May 2015. After detrending the global factors from return series, the pair-wise time varying correlations are obtained by consistent Dynamic Conditional Correlation (cDCC) modeling which is a class of Multivariate GARCH models. In contrast to the previous literature, our analysis reveals that most of the rating related announcements do not have a significant effect on the pair-wise correlations. In a limited number of cases, rating change announcements from Moody’s are more effective than that of he others. Results provide important implications for investors and policymakers. |
| Keywords: | European emerging markets, sovereign rating, financial contagion, asymmetric power ARCH, dynamic conditional correlation. |
| JEL: | C51 C58 G01 G11 G15 |
| Date: | 2015–10 |
| URL: | http://d.repec.org/n?u=RePEc:bor:wpaper:1530&r=tra |
| By: | Natalya Zelenyuk (UQ Business School, The University of Queensland, Australia); Valentin Zelenyuk (School of Economics and Centre for Efficiency and Productivity Analysis (CEPA) at The University of Queensland, Australia) |
| Abstract: | We use nonparametric method with various specifications to estimate efficiency of banks and then use truncated regression with double-bootstrap (Simar and Wilson, 2007) to analyze how various bank-specific factors explain the differences in the estimated levels of inefficiency across the banks in Ukraine, with a particular focus on foreign ownership. We show that some results are very robust, yet others depend on the chosen Data Envelopment Analysis specification for the efficiency model. We also find that the efficiency of banks with foreign ownership is not distinguishable from the efficiency of the locally-owned banks if the degree of ownership control is not accounted for. On the other hand, when we account for degree of control, we find evidence that banks that were 100% foreign-owned were significantly more efficient than the locally owned banks, while the partially foreign-owned banks were significantly less efficient than the locally owned banks (on average and ceteris paribus), thus providing empirical support for the agency and corporate governance theories in economics. |
| Keywords: | Foreign ownership, Banking, Efficiency, DEA, Truncated regression, Double-bootstrap |
| JEL: | C1 C13 C14 G2 |
| Date: | 2015–09 |
| URL: | http://d.repec.org/n?u=RePEc:qld:uqcepa:106&r=tra |
| By: | Boris B. Demeshev (National Research University Higher School of Economics); Oxana A. Malakhovskaya (National Research University Higher School of Economics) |
| Abstract: | This paper evaluates the forecast performance of Bayesian vector autoregressions (BVARs) on Russian data. We estimate BVARs of different sizes and compare the accuracy of their out-ofsample forecasts with those obtained with unrestricted vector autoregressions and random walk with drift. We show that many Russian macroeconomic indicators can be forecast by BVARs more accurately than by competing models. However, contrary to several other studies, we do not confirm that the relative forecast error monotonically decreases with increasing the crosssectional dimension of the sample. In half of those cases where a BVAR appears to be the most accurate model, a small-dimensional BVAR outperforms its high-dimensional counterpart. |
| Keywords: | VAR, BVAR, forecasting, Bayesian estimation |
| JEL: | C11 C13 C53 |
| Date: | 2015 |
| URL: | http://d.repec.org/n?u=RePEc:hig:wpaper:105/ec/2015&r=tra |
| By: | Nikolova, Milena (IZA) |
| Abstract: | Along with political and economic changes, the fall of the socialist regimes in Central and Eastern Europe and the former Soviet Union brought about fundamental institutional reforms. Several studies have examined the causes of the increasing unhappiness which accompanied the transition process, including deteriorating public goods, rising inequality, income volatility, stagnating labor market conditions, and changing norms. Yet, few papers have sought explanations for the life satisfaction differentials between transition and non-transition economies. In this paper, I specifically examine the life satisfaction gap between post-socialist and advanced countries and the role of political institutions in explaining this gap. My results imply that both macroeconomic factors and the rule of law explain the overall life satisfaction differential between the advanced and transition societies. The rule of law had an additional role of reducing the happiness gap in the 1990s and may have even reversed it in the post-crisis years. As institutions and macroeconomic conditions continue to improve, post-socialist countries may complete their transformation processes and achieve quality of life levels comparable with those in the West. |
| Keywords: | subjective well-being, institutions, transition economies |
| JEL: | D02 E02 I31 P20 |
| Date: | 2015–11 |
| URL: | http://d.repec.org/n?u=RePEc:iza:izadps:dp9484&r=tra |
| By: | Neagu, Florian; Tatarici, Luminita; Mihai, Irina |
| Abstract: | We describe an example of designing, implementing and calibrating two macroprudential instruments – loan-to-value (LTV) and debt service-to-income (DSTI) – based on a decade of Romanian experience with these tools. We investigate LTV and DSTI effectiveness in trimming down excessive credit growth and in preserving the quality of banks’ loan portfolios. We find strong links between DSTI levels and the debtors’ capacity to repay their debt, underpinning the usefulness of caps for this instrument. We find that an approach based to a large extent on banks’ self-regulation produces suboptimal results, exacerbating the pro-cyclicality in the system. A one‑size-fits-all approach is less effective than tailoring the DSTI and LTV measures based on debtors’ disposable income, the currency of indebtedness and the destination of the loan |
| Keywords: | financial stability, macroprudential instruments, house prices, credit growth, debt service-to-income (DSTI), loan-to-value (LTV), Romania |
| JEL: | E44 E58 G21 G28 |
| Date: | 2015 |
| URL: | http://d.repec.org/n?u=RePEc:pra:mprapa:65988&r=tra |
| By: | Vahan Sargsyan |
| Abstract: | Differential treatment towards minority groups in labor markets may be both a result of a governmental registration system that foster unequal rights based on the origins of individuals, and a result of a disadvantageous attitude of both local employers and the general population towards non-locals. We test for differential treatment in the Chinese labor market towards rural migrants with and without urban registration, using data from the Rural to Urban Migration Survey in China. The findings indicate that despite its often assumed large impact on the differential treatment towards rural migrants, the type of household registration (hukou) is not entirely responsible for the local-migrant differences in total hourly incomes which are not attributable to personal characteristics. The results suggest that even the complete abolishment of the hukou system may at most eliminate only a portion of the disadvantageous treatment towards rural female migrants which is not attributable to differences in personal characteristics, and may even have no measurable impact on rural male migrants working in the paid-employment sector in Chinese urban labor markets. |
| Keywords: | rural migrants; hukou registration; hukou conversion; unexplainable treatment; total hourly compensation; |
| JEL: | J71 J78 O15 R23 |
| Date: | 2015–09 |
| URL: | http://d.repec.org/n?u=RePEc:cer:papers:wp548&r=tra |
| By: | Khromov, Michael (Russian Presidential Academy of National Economy and Public Administration (RANEPA)); Vedev, Alexey (Russian Presidential Academy of National Economy and Public Administration (RANEPA)) |
| Abstract: | This paper is focused on the investigation of the model for compiling sectoral financial balances in the Russian economy in the context of the development of tools for the analysis of intersectoral financial flows. The paper is aimed at the drafting of methodological recommendations for compiling and analysis of balance of financial results as one of the element of macroanalysis method. Methodology of the research is based on the analysis of the available statistical sources and their comparison for the creation as far as it is feasible full and noncontradictory picture of the financial system of the Russian economy. |
| Keywords: | E21, E41, E51, E58, G21 |
| Date: | 2015–01–18 |
| URL: | http://d.repec.org/n?u=RePEc:rnp:ppaper:dok3&r=tra |
| By: | Kurakova, N. (Russian Presidential Academy of National Economy and Public Administration (RANEPA)); Tsvetkova, L (Russian Presidential Academy of National Economy and Public Administration (RANEPA)); Zinov, Vladimir (Russian Presidential Academy of National Economy and Public Administration (RANEPA)); Yeremchenko, Olga (Russian Presidential Academy of National Economy and Public Administration (RANEPA)); Golomysov, V. S. (Russian Presidential Academy of National Economy and Public Administration (RANEPA)) |
| Abstract: | This paper deals with issues of technological projection in Russia, as well as its methodology and tools for computing long-term forecasts. The authors give a number of examples as priorities for the development of applied science in Russia as inefficient spending of public funds due to low potential of industrialization and incorrect assessment of competitiveness of national research institutions. |
| Keywords: | Russian economy, scientific and technological development |
| JEL: | I23 I28 I22 |
| Date: | 2015–09–20 |
| URL: | http://d.repec.org/n?u=RePEc:rnp:ppaper:dok30&r=tra |
| By: | Elena Koncheva (National Research University Higher School of Economics); Nikolay Zalesskiy (National Research University Higher School of Economics); Pavel Zuzin (National Research University Higher School of Economics) |
| Abstract: | Liberalization of regional public transport market in Russia has led to continuing decline of service quality. One of the main results of the liberalization is the emergence of inefficient spatial structures of regional public transport systems in Russian regions. While the problem of optimization of urban public transport system has been extensively studied, the structure of regional public transport system has been referred less often. The question is whether the problems of spatial structure are common for regional and public transportation systems, and if this is the case, whether the techniques developed for urban public transport planning and management are applicable to regional networks. The analysis of the regional public transport system in Perm Krai has shown that the problems of cities and regions are very similar. On this evidence the proposals were made in order to employ urban practice for the optimization of regional public transport system. The detailed program was developed for Perm Krai which can be later on adapted for other regions. |
| Keywords: | regional public transport system, trunk and feeder public transport system |
| JEL: | R42 |
| Date: | 2015 |
| URL: | http://d.repec.org/n?u=RePEc:hig:wpaper:01/urb/2015&r=tra |
| By: | Nina V. Ershova (National Research University Higher School of Economics) |
| Abstract: | The improvement of the Russian investment climate encouraging an inflow of foreign direct investment (FDI) into the country’s economy is being declared at the highest levels of the Russian government as an important objective for the further economic development of the country. However, one of the best ways to develop a comprehensive roadmap covering all the spheres which investors are interested in is to consider their opinions and ideas and react to the most urgent and critical issues which serve as obstacles to their investment activities in Russia. This paper considers the case of Japanese investors in Russia and is based on a survey of Japanese companies doing business in Russia and several interviews with the representatives of the Japanese business community. We try to identify which factors attract Japanese capital to Russia and which hinder investment activities. |
| Keywords: | Russian business climate, Japanese business, foreign investment in Russia, business culture, Japanese management |
| JEL: | F21 |
| Date: | 2015 |
| URL: | http://d.repec.org/n?u=RePEc:hig:wpaper:19/ir/2015&r=tra |
| By: | Florinskaya, Yulia (Russian Presidential Academy of National Economy and Public Administration (RANEPA)); Mkrtchyan, Nikita (National Research University Higher School of Economics (Moscow); Russian Presidential Academy of National Economy and Public Administration (RANEPA)); Maleva, Tatyana Mikhailovna (Russian Presidential Academy of National Economy and Public Administration (RANEPA)); Kirillova, M. K. (Russian Presidential Academy of National Economy and Public Administration (RANEPA)) |
| Abstract: | The paper analyses labor migration in Russia and its impact on national and regional labor markets. Emphasis is placed on two types of migration - internal, represented by Russians, engaged his career in regions other than their permanent residence, and external represented by foreigners working in Russia. The basis of the analysis - the data of the FMS of Russia, Rosstat, in the including regular surveys conducted on employment, expert evaluation. The brief analysis of policies regarding labor migration undertaken in recent years. The measures for the promotion of in-country spatial mobility of the population and in the field of external labor migration. |
| Keywords: | Russian economy, labor migration, labor market |
| JEL: | F22 J11 |
| Date: | 2015 |
| URL: | http://d.repec.org/n?u=RePEc:rnp:ppaper:dok13&r=tra |
| By: | Schäfer, Larissa (Tilburg University, School of Economics and Management) |
| Abstract: | This thesis consists of three chapters, two in banking and one in international finance. The first two chapters examine how bank business models and foreign ownership structures affect bank-firm lending relationships. In particular, the first chapter reveals that foreign banks can overcome their informational disadvantage and lend to the same clientele as domestic banks with asset-based lending, shorter maturities, and credit scoring models, while domestic banks rely on relationship lending. The second chapter presents empirical evidence that relationship lending serves as a liquidity insurance for firms in distress, tolerating temporary bad results, yet extracting rents in the long run. The last chapter provides a comprehensive and detailed analysis of Central and Eastern European equity markets from the mid-1990s until now and evaluates the value of investing in these markets for global investors. |
| Date: | 2015 |
| URL: | http://d.repec.org/n?u=RePEc:tiu:tiutis:54db9c22-05fa-4444-97d5-13d1e406580b&r=tra |
| By: | Mau, Vladimir (Gaidar Institute for Economic Policy, Russian Presidential Academy of National Economy and Public Administration (RANEPA)); Ulyukaev, Sergey (Russian Presidential Academy of National Economy and Public Administration (RANEPA)) |
| Abstract: | The global crisis creates a new economic and political agenda. It requires a rethinking of many of the conclusions of economic theory and practice, which is still considered to be accepted. The paper analyzes the key issues of economic development in the medium term. Among the important for the formation of a new model of economic growth problems are considered: the rate of growth and the likelihood of long-term stagnation, new challenges to macroeconomic policies in connection with a wide spread of its unconventional tools, inequality and economic growth, the contours of the new social state, perspectives of globalization, as well as re-industrialization in developed countries. On this basis, analyzes the nature and causes of the crisis in the Russian economy, compared crises 2008-2009 and 2014-2015 years., There are three main components of the latter. We consider the effects and impact of sanctions on the change in the economic situation in the country, the medium-term structural growth constraints. Examples of medium- and long-term measures that will help to reverse the current trends and bring the economy on the path of sustainable development. |
| Keywords: | Russian economy, global crisis, economic policy |
| JEL: | F34 |
| Date: | 2015–05–17 |
| URL: | http://d.repec.org/n?u=RePEc:rnp:ppaper:dok23&r=tra |
| By: | ZHANG Hongyong; ZHU Lianming |
| Abstract: | In this paper, we empirically investigate the effect of foreign affiliates on the relationship between exports and markups of Chinese firms. After recovering quantity-based firm markups by correcting for both output and input price biases, we find evidence that exporters charge higher markups than non-exporters, and this effect is substantially less pronounced for foreign affiliates. We further decompose markups into a price and cost effect and find that the cost effect accounts for the lower markups of foreign-owned exporters. Our results suggest that foreign-owned exporters have a price premium but higher marginal costs on average. |
| Date: | 2015–11 |
| URL: | http://d.repec.org/n?u=RePEc:eti:dpaper:15127&r=tra |
| By: | Chen, Xi (Yale University) |
| Abstract: | China launched a pension program for rural residents in 2009, now covering more than 300 million Chinese. This program offers a unique setting for studying the ageing population, given the rapidity of China's population ageing, traditions of filial piety and co-residence, decreasing number of children, and dearth of formal social security, at a relatively low income level. This paper examines whether receipt of the old-age pension payment equips elderly parents and their adult children to live apart and whether parents substitute children's time involved in instrumental support to them with service consumption. Employing a regression discontinuity (hereafter RD) design to a primary longitudinal survey conducted in Guizhou province of China, this paper overcomes challenges in the literature that households eligible for pension payment might be systematically different from ineligible households and that it is difficult to separate the effect of pension from that of age or cohort heterogeneity. Around the pension eligibility age cut-off, results reveal large and significant reduction in intergenerational co-residence of the extended family and increase in service consumption among elderly parents. |
| Keywords: | rural pension, RD Design, living arrangement, service consumption |
| JEL: | H55 I38 J14 J22 |
| Date: | 2015–11 |
| URL: | http://d.repec.org/n?u=RePEc:iza:izadps:dp9482&r=tra |
| By: | Denisova-Schmidt, Elena; Huber, Martin; Prytula, Yaroslav |
| Abstract: | In this paper, we investigate experimentally the effect of an anti-corruption intervention -an info folder based on materials developed by Transparency International- on Ukrainian university students’ willingness to participate in an anti-corruption campaign and their general attitude toward corruption. In a survey of 600 students in the Ukrainian city of Lviv, individuals were randomly exposed to either the anti-corruption folder (treatment group) or a folder with information about Lviv (control group). The results suggest that students who have previous experience with bribing are more open to the campaign, while the effect on the total sample is not statistically significant. Furthermore, the intervention increases the overall perception that corruption is a (long-term) part of society rather than a temporary phenomenon. Finally, students with experience in corrupt practices tend to adopt a more negative view of corruption. For those without such experiences, however, we find some indication that the treatment could bolster the acceptance of corruption by instructing the students about its dissemination. The effects of this intervention are therefore ambivalent and appear to depend on the students’ previous exposure to corruption. |
| Keywords: | Anti-Corruption Campaigns; Corruption; Academic Integrity; University; Students; Ukraine; Experiment; Randomized Trial |
| JEL: | D73 C93 |
| Date: | 2015–11–05 |
| URL: | http://d.repec.org/n?u=RePEc:fri:fribow:fribow00462&r=tra |
| By: | Veselov Fedor (National Research University Higher School of Economics); Fedosova Alina (National Research University Higher School of Economics) |
| Abstract: | The paper is devoted to the issue of smart power system cost-benefit analysis. The innovative character of smart grids is defined and related obstacles for traditional cost-benefit assessment are revealed, primarily referred to external effects evaluation. Brief systematization of existing methods of smart grids assessment is provided and their weak points are defined. A new Smart Grid cost-benefit assessment approach is presented, basing on the elaborated comprehensive system of smart power system effects. The approach is tested for the system effects of smart power system implementation in the Russian Unified Energy System, quantitative results are presented. |
| Keywords: | smart grid, economic efficiency, cost-benefit analysis, prosumer |
| JEL: | L94 O22 Q47 |
| Date: | 2015 |
| URL: | http://d.repec.org/n?u=RePEc:hig:wpaper:49sti2015&r=tra |