nep-tra New Economics Papers
on Transition Economics
Issue of 2016‒04‒09
fifteen papers chosen by
J. David Brown
United States Census Bureau

  2. О некоторых свойствах наблюдаемого экономического роста в Китае (On Some Features of the Observed Economic Growth in China) By Konstantin Yanovskiy; Dmitry Maslov
  3. Regional Innovation Systems in China: A long-term perspective based on patent data at the prefectural level By Giorgio Prodi; Federico Frattini; Francesco Nicolli
  4. Key Determinants of Demand, Credit Underwriting, and Performance on Government-Insured Mortgage Loans in Russia By Lozinskaia Agata; Ozhegov Evgeniy
  5. Central and East European diversification under new gas market conditions By Csaba Weiner
  6. European Green Tech FDI in China: The Role of Culture By Katiuscia Vaccarini; Francesca Spigarelli; Ernesto Tavoletti
  7. Formation of the Credit Rating Agency Regulation in Russia By Anton S. Selivanovsky
  8. Love, Life, and “Leftover Ladies” in Urban China By You, Jing; Yi, Xuejie; Chen, Meng
  9. An Empirical Analysis on the Determinants of Overweight and Obesity in China By Ping Gao; Junyi Shen
  10. Domestic facilitators and impediments to EU democracy promotion in its Eastern neighbourhood: The cost-benefit balance of norm adoption By Buscaneanu, Sergiu
  11. Spatial Development Indicators, Used in the Framework of the "New Economic Geography" and How They Can Be Used in the Strategic Planning of Spatial Development of the Russian Federation By Yuri Danilov
  12. Managerial skills of women entrepreneurs in Dobrudgea’s rural area By Sima, Elena
  13. Impact of foreign direct investment (FDI) on domestic investment in Republic of Croatia By Ivanović, Igor
  14. Potash: a typical price war By Yves Jégourel
  15. Modelling the Vietnamese Economy By FitzGerald, John; Chi, Pho Thi Kim; Lam, Do Van; Ha, Hoang; Huong, Luong; Dung, Tran

  1. By: Wladimir Andreff (CES - Centre d'économie de la Sorbonne - UP1 - Université Panthéon-Sorbonne - CNRS - Centre National de la Recherche Scientifique)
    Abstract: The present chapter first reminds in which circumstances Russian companies grew multinational and then started booming, and how they were muddling through the financial crisis that burst out in 2008; in this respect, they do not compare too bad with MNCs from other transition countries. The geographical and industrial specificities of their expansion abroad are pointed out as well as the major determinants of their outward foreign direst investment (OFDI). In the past decade, their strategies have evolved from total opacity to more transparency and, in some cases have matured enough to get closer to genuine global strategies while their relationships with the Russian government have strengthened. Thus Russian MNCs make up for major pillars of state capitalism in Russia. A comparative assessment with Chinese MNCs shows deeper similarities than differences in spite of the first mover advantage that has benefited to OFDI from China over OFDI from other transition economies, of which Russia.
    Keywords: outward foreign direct investment, multinational companies, BRICs, Russia, China
    Date: 2015–12
  2. By: Konstantin Yanovskiy (Gaidar Institute for Economic Policy); Dmitry Maslov (Gaidar Institute for Economic Policy)
    Abstract: Экономический рост современного Китая впечатляет многих. Эта страна предлагается в качестве модели для подражания экономистами с совершенно противоположными взглядами: от либертарианских до этатистских. Авторы попытались показать, что: - китайский экономический рост менее устойчив, чем кажется; - власти страны, особенно в последние годы, совершают действия, подрывающие стабильность роста; Феномен быстрого экономического роста с огромным притоком иностранных инвестиций и бурным ростом экспортоориентированного сектора. Ключевую роль для Китая сыграло прекращение массовых репрессий при легализации бизнеса, создании индивидуальных неформальных гарантий для отечественных и иностранных предпринимателей. То есть предприниматель не лишался свободы и имущества только из-за воли властей, которая была не ограничена законом или какой-либо внутренней или внешней силой. Изменение политической ситуации вместе с накопленным запасом финансовой прочности создали соблазн усилить контроль над экономикой путем отказа от гарантий сначала для отечественного бизнеса, а затем и для иностранного. Именно это и происходит сейчас: когда начались аресты не только предпринимателей – граждан Китая, но и предпринимателей-нерезидентов. In this article authors focused on factors of Chinese economic miracle. Majority of economists are deeply impressed by high rate of China's economic growth. They are going to search for explanations of the coming new successes of this country. The missed point of these assessments is lack of attention to the new trend of poor formalized China institutions' development. Clearly observable in the modern Peoples Republic of China deterioration of entrepreneur's personal immunity informal guaranties means broken guaranties for private property. The government failure to defend (at least not make a threat) to private property could cause negative influence on China's economic growth in very Long Run.
    Keywords: China model, foreign direct investment, personal owners' rights informal guaranties; informal rules violation; arbitrary arrests
    JEL: P16 P37 P52 N45 D73
    Date: 2016
  3. By: Giorgio Prodi (Department of Economics and Management, University of Ferrara, Italy.); Federico Frattini (Department of Economics and Management, University of Ferrara, Italy.); Francesco Nicolli (IRCrES-CNR, Milano, Italy.)
    Abstract: This paper focuses on the connections between long-term development and Regional Innovation Systems (RIS) in China. It aims to investigate how the evolution of RIS fits with China’s overall process of economic upgrading. The analysis relies on Chinese patent applications filed to the EPO during the period 1981 to 2009, which authors have regionalised at a prefectural level. Conceptu-ally, the investigation concerns the relative prevalence of indexes derived from inventors’ and ap-plicants’ localisation to describe local innovation activities in terms of emergence, development and reinforcement. The hypothesis ranks higher those prefectures where indigenous applicants prevail, that is, the initiative, organisation and exploitation of innovation activities are foremost local (or endogenous). Results return the possibility of grouping Chinese prefectures into six clusters. On this basis, RIS features appear to diffuse, even while regional concentration of innovation activities is still increasing. This pattern is deemed to fit the process of industrial development in China very well. As it was in the past, RIS benefit from the opportunities that a long-term development strategy provides, but face its limits as well.
    Keywords: China; development; endogeneity; patent; reform; Regional Innovation System
    Date: 2016–04
  4. By: Lozinskaia Agata; Ozhegov Evgeniy
    Abstract: This research analyses the process of lending from Russian state-owned mortgage provider. Two-level lending and insurance of mortgage system lead to substantially higher default rates for insured loans. This means that underwriting incentives for regional operators of government mortgage loans perform poorly. We use loan-level data of issued mortgage by one regional government mortgage provided in order to understand the interdependence between underwriting, choice of contract terms including loan insurance by borrower and loan performance. We found an evidence of a difference in credit risk measures for insured and uninsured loans and interest income.
    JEL: C36 D12 R20
    Date: 2016–03–24
  5. By: Csaba Weiner (Institute of World Economics, Centre for Economic and Regional Studies, Hungarian Academy of Sciences)
    Abstract: The Russo–Ukrainian gas crisis of January 2009 encouraged Central and Eastern Europe (CEE) to diversify away from Russian gas supplies and new gas market conditions have afforded some opportunities for doing so. This paper assesses these achievements, as well as factors preventing CEE countries from benefiting therefrom. The paper addresses four main areas of CEE diversification: (1) gas demand, (2) domestic gas production, (3) transit, as well as (4) gas supply and physical infrastructure for source diversification. There is great variation in the degree of dependence on gas, gas imports, Russian gas and transit countries, across the CEE states. Some progress has been made in diversifying, but the degree of progress and the patterns vary significantly from country to country. Due to long-term gas import commitments and the lack of available import capacity, CEE countries can take only limited advantage of changed gas market conditions. But some countries have genuinely benefited from ongoing developments. Transit-avoidance pipelines can also increase security of supply for CEE consumers by providing the opportunity to arbitrage across gas transit corridors. Despite many criticisms, the EU has taken steps that may help mitigate Russian influence.
    Keywords: Central and Eastern Europe, Russian gas, dependence, diversification, security of supply
    JEL: L71 L95 O13 P28 Q4
    Date: 2016–02
  6. By: Katiuscia Vaccarini (University of Macerata, Italy); Francesca Spigarelli (University of Macerata, Italy); Ernesto Tavoletti (University of Macerata, Italy)
    Abstract: The purpose of this paper is to investigate to what extent culture and language affect European foreign direct investments (FDI) in mainland-China. It provides an in-depth analysis on the perception of European and Chinese identity and the role played by language in fostering or hampering FDI, along with culture. Design/methodology/approach: our research questions are contextualized and timely/spacely bound through a multiple case study panel of six European companies, which entered the Chinese green tech market through FDI. We used quantitative and qualitative approaches and a three-phase data collection process, based on a specific protocol. Findings: findings suggest that European investors emphasize “intra-Europe” differences rather than a ”European collective (id)entity”. They have more awareness of the intra-China differences in the post-entry rather than the pre-entry period. The cultural factor goes along with the language dimension, which, in specific cases, is perceived as a higher hurdle than culture. However, by adopting a cognitive and social psychological viewpoint, language and culture are not stand-alone dimensions and intersect with each other. They both contribute to the concept of identity. Research limitation/implication: the analytical generalisation out of our multiple case study is limited to a specific industry and to specific home and target economic areas. Practical implications: our research offers an in-depth insight about the role and the perception of culture of European companies investing in China mainland. This study is not only addressed to academics and scholars, but also to managers who want to approach the market and policy makers.
    Keywords: green tech FDI, Europe, China, cultural distance, psychic distance
    JEL: L25 L26
    Date: 2015–06
  7. By: Anton S. Selivanovsky (National Research University Higher School of Economics)
    Abstract: This Working Paper is dedicated to the new system of legal regulation of credit rating agency (hereinafter “CRA”) activity in Russia. The main focus of the new rules is administrative regulation and rigid control of procedural issues by the Russian mega-regulator for financial markets. The author criticizes current legislation and argues that such rules will obstruct CRA activity and adversely affect protection of investors’ and creditors’ rights, and will ultimately lead to an increase in transaction costs. It is necessary to continue work on CRA regulation in order to develop effective mechanisms to ensure a balance of interests among parties to the credit rating contract, and ensure that investors and the regulator take into account not only legal, but also economic, managerial, organizational and a number of other issues. Regulation of CRA focused only on rigid control of procedural issues by the Bank of Russia will not lead to the desired result. CRA regulation should instead be "delicate and fine."
    Keywords: credit rating agencies, securities market, conflict of interests, regulation of credit rating agencies, liability of rating agencies
    JEL: Z
    Date: 2016
  8. By: You, Jing; Yi, Xuejie; Chen, Meng
    Abstract: The Chinese urban society in recent years has shown rising age at first marriage and declining marriage rates, especially among professional females with at least college degrees in their late 20s or their 30s. We exploit two nationally representative datasets over the period 2008-2012 and investigate the determinants of forming marriage for urban women aged 27 or above who are termed “leftover”. We estimate a recursive and dynamic mixed-equation model to describe women’s joint decisions on career, education and marriage. This considers various traits including demographic characteristics, wealth, work-related indicators, personality, attitudes and expectation, physical and facial attractiveness, leisure activities, personal and parental social status, local gender identity norms and marriage market conditions. We find “marital college-discount”: college education reduces the probability of marriage by 2.88%-3.6% and a postgraduate degree further oppresses it by 8.4%-10.4%. Counterfactual analysis indicates monotonicity, complementarity and substitution in multidimensional matching patterns. Patriarchy still appears to prevail.
    Keywords: marriage, gender, education, earnings, China
    JEL: J12 J16 O53
    Date: 2016–04–04
  9. By: Ping Gao (Graduate School of Economics, Kobe University); Junyi Shen (Research Institute for Economics & Business Administration (RIEB), Kobe University, Japan)
    Abstract: Overweight and obesity in adult populations is considered to be a growing epidemic worldwide, and appears to be rapidly increasing in China. From 1992 to 2002, the incidence of overweight in adults increased by 39.0%, while that of obesity doubled. To identify the determinants of adult overweight and obesity in China, micro-level data from a questionnaire survey entitled the "Preference Parameters Study," which was conducted by the Global Centers of Excellence program at Osaka University, were analyzed. In addition to the entire sample, data from urban and rural subsamples were also analyzed in order to investigate whether the determinants of overweight and obesity differed. The results suggested that body mass index (BMI) is correlated with subjective well-being, gender, age, labor intensity and drinking and eating habits among urban respondents, and with age, monthly income, number of siblings and eating habits among rural respondents.
    Keywords: Body mass index (BMI), Overweight and obesity, Urban residents, Rural residents, China
    JEL: C21 D12 I12
    Date: 2016–03
  10. By: Buscaneanu, Sergiu
    Abstract: This paper argues that the balance between the size of EU incentives and the costs of democratic transformation has impeded democratic consolidation in Eastern ENP countries. Whereas the cost-benefit balance of norm adoption appears to be a relevant predictor of regime trajectories in this region, patterns of economic development do not match those of political regimes. Institutional design seems to fit better regime dynamics in Eastern ENP countries, but it is also possible that the nature of main political institutions depends on the regime. The road from institutions to the regime is a two-way road. Finally, the number of parties in power within executives does not say much about regime trajectories. The degree of a pro-European (Western) stance of the governing party or coalition must be incorporated into the analysis. To this end, a coalitional government that had a strong pro-EU identity proved to be a promising facilitator of external democracy promotion efforts.
    Keywords: cost-benefit balance,structures,institutions,actors,regimes,Eastern ENP countries
    Date: 2016
  11. By: Yuri Danilov (Department of Economics, Lomonosov Moscow State University)
    Abstract: The article discusses the main elements of the "new" economic geography, adequately describes the current patterns of spatial development. In the context of reducing the share of transportation costs in the total cost of production is enhanced agglomeration effect, resulting in a further concentration of production and population. The article presents the basic tools and measures used by the "new" economic geography. The article formulates proposals for the application of developments and achievements of the "new" economic geography in the strategic planning of spatial development of the Russian Federation. Forecasting and strategic planning indicators are proposed, which most adequately reflect the processes of spatial development taking place in the modern economy
    Keywords: spatial development, indicators of spatial development, new economic geography, distances interpretation, agglomeration effect, strategic planning
    JEL: R58 N90 B20
    Date: 2016–04
  12. By: Sima, Elena
    Abstract: Women have become more important in the global market, not just as employees, but also as consumers, entrepreneurs, managers and investors. This paper aims to capture the managerial skills of women entrepreneurs in Dobrudgea’s rural area and the difficulties that women entrepreneurs are facing, the gender differences and gender diversity in business, as well as their impact on the economy. By approaching this theme, we intend to highlight the problems faced by women both in terms of concepts and education by analyzing the employment rate by age, status and education level. Although women are still a minority in entrepreneurship and entrepreneurial skills and women workforce in rural areas are underused, in recent years there has been a considerable increase worldwide in the number of women who start and run their own business. Moreover, it is a general characteristic of Eastern European countries, which have the lowest levels of women’s participation in entrepreneurial activities.
    Keywords: women entrepreneurs, managerial skills, rural area, Dobrudgea
    JEL: O15 R1 R19
    Date: 2015–11–20
  13. By: Ivanović, Igor
    Abstract: The aim of this paper is to investigate how foreign direct investment (FDI) affects domestic investment in the Republic of Croatia. More precisely, the general purpose of this study is to determine the impact of net inflow of foreign capital on domestic investment in order to gain a clearer picture about the sensitivity and efficiency of domestic investment. After parsing domestic investment and FDI in Croatia, according to Croatian Bureau of Statistics and the Croatian National Bank, a historical overview of their movement from 1995 to 2014 was analyzed. In the following an overview and comparison of studies from around the world which deal with similar topic was made. In the empirical part; domestic gross fixed capital formation, changes in domestic stocks, net FDI and GDP growth rate was used as variables. Quarterly time series data ranging from the Q1 2001 to Q4 2014 were processed with the subset VAR (vector autoregressive) econometric model. The results shows that FDI have negative influence on domestic investment in the Republic of Croatia with time lag.
    Keywords: foreign direct investment; gross investment; crowding out/in effect; subset VAR; investment efficiency
    JEL: F21
    Date: 2015–11–25
  14. By: Yves Jégourel
    Abstract: Along with phosphorus and nitrogen, potash constitutes one of the three nutrients used in the production of fertilizers. Although the factors that influence its demand are mostly common to other fertilizers and in large part determined by the agricultural market conditions, its supply depends on specific factors. Long known to be controlled by two production and export cartels, the potash market experienced a major change in 2013 with the end of the Russian Belarusian agreement. In a difficult economic climate, this rupture has resulted in the start of a price war, similar to what has been observed for other commodities such as iron ore.
    Keywords: Potash, price, commodities, fertilizers, agriculture, development
    Date: 2016–03
  15. By: FitzGerald, John; Chi, Pho Thi Kim; Lam, Do Van; Ha, Hoang; Huong, Luong; Dung, Tran
    Abstract: This paper considers the factors determining the long-run behaviour of the Vietnamese economy. Using a macro-economic model of the Vietnamese economy it considers some of the factors that have contributed to growth over the last decade and also some of the policy options for the rest of the decade.
    Date: 2016–03

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