nep-tra New Economics Papers
on Transition Economics
Issue of 2016‒08‒21
twenty-two papers chosen by
J. David Brown
United States Census Bureau

  1. Charitable Donations by China's Private Enterprises By Gustafsson, Björn Anders; Yang, Xiuna; Shuge, Gang; Jianzhong, Dai
  2. Does Higher Education Contribute to a Change in Attitudes to Government Price Control in Russia? By John V. Nye; Maksym Bryukhanov; Sergiy Polyachenko
  3. Roads to innovation: Firm-level evidence from China By Wang, Xu; Zhang, Xiaobo; Xie, Zhuan; Huang, Yiping
  4. Does female labor scarcity encourage innovation?: Evidence from China’s gender imbalance By Tan, Zhibo; Zhang, Xiaobo
  5. Labour Market Policies for Encouraging Economic Activity and Labour Productivity in Bulgaria By Beleva, Iskra
  6. Types of FDI and determinants of affiliate size: the classification makes the difference By Hecht, Veronika; Moritz, Michael; Noska, Patricia; Schäffler, Johannes
  7. Saving China's Stock Market By Yi Huang; Jianjun Miao; Pengfei Wang
  8. The Consequences of Spatially Differentiated Water Pollution Regulation in China By Zhao Chen; Matthew E. Kahn; Yu Liu; Zhi Wang
  9. Cluster Analysis in Human Development of Visegrad Group Plus Countries By Ingrid Majerová; Jan Nevima
  10. Structural transformation and intertemporal evolution of real wages, machine use, and farm size–productivity relationships in Vietnam By Liu, Yanyan; Violette, William; Barrett, Christopher B.
  11. International Technology Diffusion via Goods Trade: Theory and Evidence from China By Eugene Beaulieu; Shan Wan
  12. VAT non-compliance in Poland under scrutiny (Problem nieœci¹galnoœci VAT w Polsce pod lup¹) By Grzegorz Poniatowski; dr. Jaros³aw Neneman; Tomasz Michalik
  13. The impact of pension system reform on projected old-age income: the case of Poland By Elena Jarocinska; Anna Ruzik-Sierdzinska
  14. Do banks extract informational rents through collateral? By Bing Xu; Adrian van Rixtel; Honglin Wang
  15. Business Cycle Accounting: Bulgaria after the introduction of the currency board arrangement (1999-2014) By Vasilev, Aleksandar
  16. The Lasting Effect of Sex Ratio Imbalance on Marriage and Family: Evidence from World War II in Russia By Brainerd, Elizabeth
  17. The Collaborative Economy in Poland and Europe: A Tool for Boosting Female Employment? By Karolina Beaumont
  18. Continuity under a different name: The outcome of privatisation in Serbia By Ivanovic, Vladan; Kufenko, Vadim; Begovic, Boris; Stanisic, Nenad; Geloso, Vincent
  19. Dynamics of Innovation and Internationalization among Small and Medium-Sized Enterprises in Viet Nam By Trinh, Long Q.
  20. Change in Economic Policy Paradigm: Privatization and State Capture in Poland By Piotr Kozarzewski; Maciej Ba³towski
  21. Regulatory Incentives for a Low-Carbon Electricity Sector in China By Flavio Menezes; Xuemei Zhang
  22. Firm performance and (Foreign) Debt Financing before and During the Crisis: Evidence from Firm-Level Data By Mateja GabrijelÄ iÄ; UroÅ¡ Herman; Andreja LenarÄ iÄ

  1. By: Gustafsson, Björn Anders (University of Gothenburg); Yang, Xiuna; Shuge, Gang (Beijing Academy of Social Sciences); Jianzhong, Dai (Beijing Academy of Social Sciences)
    Abstract: The number of private enterprises in China has grown rapidly, and donations from them are an important source of philanthropy in China today. This paper investigates donations given in 2011 by private enterprises using a survey of data covering all 31 provincial-level units of China. The data show that philanthropy practised by Chinese private enterprises is widespread, but the amounts of donations are unequally distributed. Furthermore, donations are positively related to a company's profit and in most cases also to the owner's political participation as expressed in membership in the People's Congress (PC) as well as the Chinese People's Political Consultative Conference (CPPCC) at different levels. Donating is also positively related to the presence of a branch of the Communist Party of China and a trade union within the firm. In contrast, there is little support for donations being related to the characteristics of the major owner in the business, such as their gender, age, previous employment experience, party membership or to the governance structure or location of the private firms.
    Keywords: China, philanthropy, donations, private enterprises
    JEL: D64 H84 L26
    Date: 2016–08
  2. By: John V. Nye (National Research University Higher School of Economics); Maksym Bryukhanov (National Research University Higher School of Economics); Sergiy Polyachenko (National Research University Higher School of Economics)
    Abstract: Does the educational process itself transform an individual’s world outlook towards pro-market values in transition? Much evidence indicates that education correlates with liberal values. However, it is not clear whether this association is the result of selection into education or whether education itself makes people liberal as education and liberal values both are linked to unobservable characteristics such as cognitive abilities, household traits, and the social environment, implying biased ordinary least squares estimates. We employ unique data from 2 waves of the Russian Longitudinal Measurement Survey (RLMS) which contains individual attitudes towards government price control. To overcome the issue of the mutual correlation of liberal values, education, and predetermined and time stable characteristics (fixed effects), we use regressions in first-differences. A negative link between obtaining higher education and support for government price control is documented. The results are also robust to different indicators of the dependent variable and for different sub-samples. Additionally, based on a cross-section sample, we provide evidence that the psychodynamic channel of educational impact on pro-market attitudes is important: white-collar occupations can be considered as insurance against possible market price shocks. The liberal effect of education shows the importance of research on educational policy in the process of the formation of pro-market attitudes in Russia and in other transition economies.
    Keywords: market economy, values, education, Russia, attitudes, RLMS
    JEL: P10 I23
    Date: 2016
  3. By: Wang, Xu; Zhang, Xiaobo; Xie, Zhuan; Huang, Yiping
    Abstract: Although both infrastructure and innovation play an important role in fostering a country’s economic growth, discussion in the literature about how the two are connected is limited. This paper examines the impact of road density on firm innovation in China using a matched patent database at the firm level and road information at the city level. Regional variation in the difficulty of constructing roads is used as an instrumental variable to address the potential endogeneity problem of the road variable. The empirical results show that a 10 percent improvement in road density increases the average number of approved patents per firm by 0.71 percent. Road development spurs innovation by enlarging market size and facilitating knowledge spillover.
    Keywords: CHINA, EAST ASIA, ASIA, infrastructure, innovation, transportation, technology transfer, knowledge diffusion, O31 Innovation and Invention: Processes and Incentives, O33 Technological Change: Choices and Consequences, Diffusion Processes, R11 Regional Economic Activity: Growth, Development, Environmental Issues, and Changes, R40 Transportation Economics: General,
    Date: 2016
  4. By: Tan, Zhibo; Zhang, Xiaobo
    Abstract: Facing scarcity of a production factor, a firm can develop technologies to either substitute the scarce factor (price effect) or complement the more abundant factors (market size effect). Whether the market size effect or the price effect dominates largely depends on the elasticity of substitution among factors according to the theory of directed technical change. However, it is a great challenge to empirically test the theory because factor prices are often endogenously determined. In this paper, we use imbalanced sex ratios across Chinese provinces as a source of identification strategy to test how female labor scarcity affects corporate innovation based on the matched dataset of annual surveys of industrial firms in China and the national patent database. In regions with a large male population, female-intensive industries face more serious problems finding female workers than their male-intensive counterparts. We find that such female shortages have spurred firms in female-intensive industries to innovate more. The pattern is much more evident in industries with low substitution between female and male workers than in those with high substitution, consistent with the predictions of directed technical change theory.
    Keywords: CHINA, EAST ASIA, ASIA, prices, markets, labor, technology, innovation, gender, factor endowment, directed technical change, price effect, market size effect, elasticity of substitution, O31 Innovation and Invention: Processes and Incentives, O32 Management of Technological Innovation and R&, D, J21 Labor Force and Employment, Size, and Structure,
    Date: 2016
  5. By: Beleva, Iskra
    Abstract: This article aims to present the recent labour market policies for encouraging economic activity of working age population, labour market inclusion 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 results of the analysis show up both positive and negative features of the implemented policies. These policies contribute to increasing labour market inclusion in the short run and this is the main positive effect. Meanwhile, the lack of consistence of the policy and sustainability of employment embody the main negative feature. The article analyses the effect of the Human Resource Development Program, conducted in Bulgaria in the period 2007-2013, over the labour market development, labour inclusion and productivity, in particular. It employs different quantitative and qualitative indicators to assess the achievements of a total of EUR 402.4 millions, invested in policies for encouraging economic activation of working age population, labour market inclusion and increasing labour productivity. In conclusion the author draws out recommendations for improvements of conducted policies.
    Keywords: labour market policy, employment, economic activity, labour productivity, assessment, efficiency
    JEL: J45 J48
    Date: 2016
  6. By: Hecht, Veronika (Institut für Arbeitsmarkt- und Berufsforschung (IAB), Nürnberg [Institute for Employment Research, Nuremberg, Germany]); Moritz, Michael (Institut für Arbeitsmarkt- und Berufsforschung (IAB), Nürnberg [Institute for Employment Research, Nuremberg, Germany]); Noska, Patricia; Schäffler, Johannes (Institut für Arbeitsmarkt- und Berufsforschung (IAB), Nürnberg [Institute for Employment Research, Nuremberg, Germany])
    Abstract: "This paper deals with the measurement of motives for foreign direct investment (FDI). Due to a lack of information, several indirect measures exist in order to classify multinational firms into the two main types of FDI. While vertical foreign direct investment (VFDI) refers to the international fragmentation of the production process for cost-saving reasons, horizontal foreign direct investment (HFDI) is performed in order to gain access to new markets. One common approach to identify the dominant reason for firms to go abroad is to compare the industry affiliation of the investing company in the home country and the subsidiary in the target country. The question arises as to how reliable this measure is for identifying FDI motives. The IAB-ReLOC survey allows a profound investigation on the issue of classifying the motives of the firms for going abroad into vertical and horizontal FDI. Apart from industry affiliation data applied in conventional approaches to categorize FDI types, the survey data also includes a self-assessment of the firms with respect to the main motive for investing in the neighboring country, and information on intra-firm trade concerning the flow of intermediate inputs between the German headquarters and the Czech affiliates. Against the background of featuring a well-grounded database, we shed a light on the relevance of productivity in the German-Czech FDI relations. We pursue a reference group approach by comparing German multinational firms that have an affiliate in the Czech Republic to German companies without direct investment abroad. The data provided by the German multinationals enables us to investigate the size of FDI under the aspect of the number of employees in their Czech affiliates. By applying a two-step Heckman procedure, we control for sample selection bias: in the first stage we analyze the extensive margin of FDI, i.e. the probability to select into the group of multinational investors. The second stage examines the relationship between productivity and the intensive margin of FDI. We find evidence that productivity is not only a crucial factor for the decision to invest in the neighboring country, but plays also a relevant role for the number of employees in the Czech subsidiary. Differences are revealed between direct and indirect measures of FDI types. The size of horizontal investments is significantly affected by productivity only in the case of classifications that are based on survey responses. This result confirms theoretical expectations and previous empirical literature by standing in marked contrast to the outcome for indirect measurement concepts. Our finding leads us to the conclusion that one should be more cautious in interpreting differences between vertical and horizontal FDI when using approximative classification concepts." (Author's abstract, IAB-Doku) ((en))
    JEL: F23 J21 R12
    Date: 2016–08–15
  7. By: Yi Huang (IHEID, The Graduate Institute of International and Development Studies, Geneva); Jianjun Miao (Boston University); Pengfei Wang (The Hong Kong University of Science and Technology)
    Abstract: What were the economic benefits and costs of preventing a stock market meltdown during the summer of 2015 by the Chinese government intervention? We answer this question by estimating the value creation for the stocks purchased by the government between the period starting with the market crash in mid-June and the market recovery in September. We find that the government intervention increased the value of the rescued firms with a net benefit between RMB 5,697 and 6,635 billion, which is about 10% of the Chinese GDP in 2014. The value creation came from the increased stock demand by the government, the reduced default probabilities, and the increased liquidity.
    Keywords: China, Stock Market Crash, Government intervention
    JEL: G14 G15 G18
    Date: 2016–08
  8. By: Zhao Chen; Matthew E. Kahn; Yu Liu; Zhi Wang
    Abstract: China’s environmental regulators have sought to reduce the Yangtze River’s water pollution. We document that this regulatory effort has had two unintended consequences. First, the regulation’s spatial differential stringency has displaced economic activity upstream. As polluting activity agglomerates upstream, more Pigouvian damage is caused downstream. Second, the regulation has focused on reducing one dimension of water pollution called chemical oxygen demand (COD). Thus, local officials face weak incentives to engage in costly effort to reduce other non-targeted but more harmful water pollutants such as petroleum, lead, mercury, and phenol.
    JEL: Q25 Q52
    Date: 2016–08
  9. By: Ingrid Majerová (Departament of Economics and Public Administration, School of Business Administration, Silesian University); Jan Nevima (Departament of Economics and Public Administration, School of Business Administration, Silesian University)
    Abstract: Human Development Index measures the level of human development not only by GDP per capita, but also trough the indicators of education and healthy life. The differences in the level of human development are observed not only at the national level, they are also measured at the regional level of countries. The aim of this article is, with the quantification of regional human development, to describe the potential for human development using cluster analysis at the regional level. The 46 regions of the Visegrad Group Plus countries (Czech Republic, Poland, Hungary, Slovakia, Austria and Slovenia) at NUTS II level were selected for this purpose. The research was made in the period from 2004 to 2013. In the selection of indicators, the same approaches as by the HDI were adopted, however the components of each dimension were modified. Life expectancy at birth (dimension of health), tertiary educated people and lifelong learning (dimension of education) and GDP per capita in PPS (dimension of living standards) have been chosen as indicators of human development. These components were than used in a hierarchy cluster analysis in the Ward method. Three clusters were created with different levels of potential. Initially, a research hypothesis that there was a dynamization of human development processes in most regions has been set. This hypothesis was not confirmed and it was found that a vast majority of the regions have not changed their positions in the cluster in the monitored period.
    Keywords: cluster analysis, GDP per capita, human development, life expectancy at birth, lifelong education, NUTS II regions, tertiary education, Visegrad Group Plus.
    JEL: O15 I31
    Date: 2016–07–29
  10. By: Liu, Yanyan; Violette, William; Barrett, Christopher B.
    Abstract: This paper explores the evolution of real agricultural wages, machinery use, and the relationship between farm size and productivity in Vietnam during its dramatic structural transformation over the course of the 1990s and 2000s. Using six rounds of nationally representative household survey data, we find strong evidence that the inverse relationship between rice productivity and planting area attenuated significantly over this period and that the attenuation was most pronounced in areas with higher real wages. This pattern is also associated with sharp increases in machinery use, indicating a scale-biased substitution effect between machinery and labor. The results suggest that rural-factor market failures are receding in importance, making land concentration less of a cause of concern for aggregate food production.
    Keywords: VIET NAM, VIETNAM, SOUTH EAST ASIA, ASIA, productivity, structural change, farm size, food production, households, mechanization,
    Date: 2016
  11. By: Eugene Beaulieu (University of Calgary); Shan Wan (University of Calgary)
    Abstract: This paper develops a multi-product firm model of international trade with the endoge- nous decisions on export and import to study technology diffusion via goods trade. In our model, a firm’s productivity in a product is a combination of its general ability which applies to all the goods the firm produces and product expertise which applies only to a particular good. Within each firm, the decisions of export and import are based on product expertise. Technology diffuses via goods trade, therefore a firm can improve its productivity by reverse-engineering the imported advanced foreign prod- ucts. We use Chinese trade data to empirically analyze our theory. The results show that a firm will import the product in the category where it already has higher expertise, which is consistent with the theoretical prediction. We find that a firm’s productivity in a category gets improved when it imports in the same category, but only product expertise gets accumulated, not the firm ability.
    Date: 2016–08–12
  12. By: Grzegorz Poniatowski; dr. Jaros³aw Neneman; Tomasz Michalik
    Abstract: Since 2009, despite constant growth in the tax base and only slight variations in effective rates, the trend in VAT revenue in Poland has been reversed, and inflows have become less stable. The ongoing decline in VAT collection and the increase in the uncertainty related to the main component of budget revenues is a very important problem, which in the light of growing budget spending may threaten the stability of public finances. Three experts: Grzegorz Poniatowski, dr. Jaros³aw Neneman and Tomasz Michalik examine the structure and the causes of the VAT gap as well as the legal context and possible methods of improving VAT compliance at national and European level.
    Keywords: Economics and Finance, Macroeconomics and Monetary Economics
    JEL: E E02 E5 E6 E42
    Date: 2016–06
  13. By: Elena Jarocinska; Anna Ruzik-Sierdzinska
    Abstract: This paper analyses the distributional effects of the Polish old-age pension reform introduced in 1999. Following a benchmark Mincer earnings equation, and using a newly developed microsimulation model we project future pension benefits for males born in years 1969–1979. We find that inequality of predicted first pension benefits measured by the Gini coefficient increases from 0.119 to 0.165 for cohorts of men retiring between 2036 and 2046. The observed increased inequality of pension benefits is due to the decreasing share of initial capital that is based on a more generous DB formula in the total accumulated pension capital. At the same time, inequality in replacements rates decreases due to a stronger link between contributions paid through the entire working life and pension benefits.
    Keywords: pension benefits, inequality, replacement rates, microsimulation
    JEL: H55 J26
    Date: 2016–04
  14. By: Bing Xu (Universidad Carlos III, Madrid); Adrian van Rixtel (Banco de España); Honglin Wang (Hong Kong Monetary Authority)
    Abstract: The use of collateral is one of the defining characteristics of loan contracts. This paper investigates if relationship lending and market concentration allow for informational rent extraction through collateral. We use equity IPO data as informational shocks that erode rent-seeking opportunities. Using a new loan-level database for China, we find that collateral incidence increases with relationship intensity and banking market concentration for loans obtained pre- IPO, while this effect is more moderate post-IPO. We also show that the degree of rent extraction declines for lower-risk firms post-IPO, while it increases for higher-risk firms. These results are not driven by differences or changes in firm-specific financial risks. To our knowledge, our paper is the first to investigate the determinants of collateral for China using loan-level data.
    Keywords: Informational rents, collateral, relationship lending, market structure, IPOs, China
    JEL: G21 L11
    Date: 2016–08
  15. By: Vasilev, Aleksandar
    Abstract: This paper focuses on explaining the economic fluctuations in Bulgaria after the introduction of the currency board arrangement in 1997, the period of macroeconomic stability that ensued, the EU accession, and the episode of the recent global financial crisis. This paper follows Chari et al. (2002) and performs business cycle accounting (BCA) for Bulgaria during the period 1999-2014. As in Cavalcanti (2007), who studies the Portuguese business cycles, most of the volatility in output per capita in Bulgaria over the period is due to variations in the efficiency and labor wedges.
    Keywords: Business Cycle Accounting,Bulgarian economy,efficiency and labor wedges
    JEL: E32 E37 O47
    Date: 2016
  16. By: Brainerd, Elizabeth (Brandeis University)
    Abstract: How does a shock to sex ratios affect marriage markets and fertility? I use the drastic change in sex ratios caused by World War II to identify the effects of unbalanced sex ratios on Russian women. Using unique data from the Soviet archives, the results indicate that male scarcity led to lower rates of marriage and fertility, higher nonmarital births and reduced bargaining power within marriage for women most affected by war deaths. The impact of sex ratio imbalance on marriage and family persisted for years after the war's end, and was likely magnified by policies that promoted nonmarital births and discouraged divorce.
    Keywords: sex ratios, marriage, family, fertility, divorce law
    JEL: J12 J16 N34 P23
    Date: 2016–08
  17. By: Karolina Beaumont
    Abstract: The paper discusses the challenges of the collaborative economy as a system stimulating female social and economic empowerment and assesses the opportunities offered by the collaborative economy in increasing the female labour participation rate amongst Polish women.
    Keywords: collaborative economy, sharing economy, new business models, gender equality, self-employment, female employment
    JEL: J16 J21 J23 J24
    Date: 2016
  18. By: Ivanovic, Vladan; Kufenko, Vadim; Begovic, Boris; Stanisic, Nenad; Geloso, Vincent
    Abstract: Normally, privatisation is seen as beneficial. In the case of Serbia, the results are disappointing. This paper considers the failure of privatisation in Serbia - a latecomer in the matter - where privatisation was partly a result of exogenous pressures. In Serbia, a sizeable number of privatised firms were bought by bureaucrats and politicians and all firms were subjected to a period of supervision. We argue that this process of privatisation was designed to allow rentseekers to conserve their privileges through asset stripping and that this explains the failure. In order to do so, we perform empirical analysis of the determinants of liquidation, merger and bankruptcy of privatised firms from 2002 to 2015. We construct a novel data set from primary sources, free of the 'survivorship bias' and containing proxies for various types of owners, indirect signs of asset stripping strategy and a broad range of controls. Our results indicate that firms owned by politicians face significantly higher risks of bankruptcy, especially after the end of supervision.
    Keywords: privatisation,asset stripping,logistic regression,survival analysis
    Date: 2016
  19. By: Trinh, Long Q. (Asian Development Bank Institute)
    Abstract: This paper examines the bidirectional causality between innovation and internationalization in the context of developing countries. Using a dynamic bivariate probit model and adopting a broad definition of internationalization, this paper analyzes these issues using a panel dataset of small and medium-sized enterprises in Viet Nam. The results show a high persistence in process and product innovations and internationalization decisions. Furthermore, we find that, for non-micro firms, past internationalization has a positive effect on process innovation, but past process innovation does not have a significant effect on the internationalization decision. For this group of firms, we also find signs of cross-dependence between process innovation and the internationalization decision. Our results, however, do not show dynamic interdependence between internationalization and product innovation.
    Keywords: SME internationalization and innovation; process innovation; cross-dependence; product innovation
    JEL: L20 L25 O31
    Date: 2016–08–16
  20. By: Piotr Kozarzewski; Maciej Ba³towski
    Abstract: Kozarzewski and Ba³towski analyse the causes and manifestations of this trend in economic policy in Poland. They use privatization policy as an example. The authors examine the effects of the privatization policy and point to a large unfinished agenda in ownership transformation that has had an adverse impact on the institutional setup of the Polish state, creating grounds for rent seeking and cronyism, which, in turn, impede the pace of privatization. They find out that it is the increasing capture of the state by rent-seeking groups, and not, contrary to popular opinion, the global financial crisis, that most contributes to the growing statist trends of Poland’s economic policy.
    Keywords: Poland, privatization, economic policy, post-communist transition, crony capitalism, rent seeking, role of the state
    JEL: D72 L33 P16 P31
    Date: 2016
  21. By: Flavio Menezes (School of Economics, University of Queensland); Xuemei Zhang (School of Economics, Southwestern University of Finance and Economics)
    Abstract: This paper reviews the incentives for pursuing a low-carbon electricity sector that are embedded in China’s regulatory and policy framework. To do so, we first describe the industry structure and the regulatory framework. Second, we explicitly review the policies that were developed to promote energy efficiency and renewable energy. These policies range from the introduction of legal requirements to undertake particular actions to pricing mechanism and financial incentives. The paper reviews evidence that the various programs designed to replace less efficient with more efficient power generation units have already produced impressive results. In addition, there has been steady progress in reducing line losses. Thus, supply-side energy efficient initiatives have been, at least, moderately successful. In contrast, we show that demand-side energy efficiency initiatives seem to have gone nowhere. Finally, we tease out the challenges faced by a sector governed by a myriad of complex arrangements, different institutions and agents who face different and often conflicting incentives for pursuing environmental and energy efficiency objectives.
    Keywords: Regulatory Incentives, Energy Efficiency, Renewable Energy, Electricity Sector
    Date: 2016–08–08
  22. By: Mateja GabrijelÄ iÄ (Bank of Slovenia); UroÅ¡ Herman (GSEFM, Goethe University Frankfurt); Andreja LenarÄ iÄ (European Stability Mechanism)
    Abstract: We study the effects of financial leverage and foreign financing on firm performance before and during the recent crisis, using a large panel of Slovenian companies. We find a significant negative impact of leverage on firm performance, even when we explicitly control for the reverse causality between the two variables. The negative effect, albeit weaker, persists also in the crisis period. Firms with some foreign debt performed better on average than firms relying only on domestic financing. At the same time, they suffered a stronger decrease in performance if their total leverage increased. Moreover, when we explicitly control for the amount of foreign financing, we find that it has a positive and highly significant effect on firm performance. The significant positive effect of foreign financing in the pre-crisis period seems to be entirely driven by privately owned firms, while the effects are negative for the state owned companies. During the crisis, the effects are positive but insignificant for both ownership types. Finally, when comparing domestic and foreign owned firms, we see no substantial variation in the coefficients.
    Keywords: Leverage, foreign leverage, firm performance, instrumental variable, panel data, crisis
    JEL: F34 G15 G24 H63
    Date: 2016–07

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