nep-tra New Economics Papers
on Transition Economics
Issue of 2017‒04‒09
five papers chosen by
J. David Brown
United States Census Bureau

  1. The Russian Economic Crisis and Falling Remittances in Central Asia By Yun, ChiHyun
  2. External Monetary Shocks to Central and Eastern European Countries By Pierre Lesuisse
  3. Genuine output and genuine productivity of China's provinces : a multiregional input-output analysis By Gao, Yuning; Lu, Yufeng; Meng, Bo; Yu, Miao
  4. Development of off-farm employment and its determinants in rural China By Hoken, Hisatoshi
  5. Loss Aversion and Residential Property Development Decisions in the People’s Republic of China: A Semi-Parametric Estimation By Bao, Helen X. H.; Meng, Charlotte Chunming

  1. By: Yun, ChiHyun (Korea Institute for International Economic Policy)
    Abstract: Long since before the Russian economic crisis, remittances from Russia have been a major source of foreign currency income in Central Asia. In 2013, Tajikistan received remittances of $4,219 million, or 49.6%, as a proportion of GDP. In the same year, remittances accounted for 31.1% and 11.1% of GDP in the Kyrgyz Republic and Uzbekistan, respectively. By that time, approximately 60-80% of labor migrants of these three remittance-dependent Central Asian countries, a population of roughly 4.3 million, were assumed to be residing in Russia. Remittances from Russia amounted to $14 billion, which accounted for more than 90% of total remittance inflows. However, Western economic sanctions against Russia over the Ukraine Crisis in mid-2014, and the collapse of the Russian ruble coinciding with persisting lower oil prices, have negatively affected the remittance-dependent countries over the last two years. Remittance inflows slashed in half, the unemployment rate jumped as a large number of migrant workers lost their jobs, and the inflation rate rose due to extreme currency depreciation. In this context, this article aims to understand the current economic status of the three remittance-dependent countries in Central Asia - Kyrgyz Republic, Tajikistan and Uzbekistan - and suggest countermeasures for sustainable socio-economic development in terms of labor migration and remittances.
    Keywords: Remittances; Labor Migrant; Migration; Central Asia; Kyrgyz Republic; Tajikistan; Uzbekistan; Russia
    Date: 2016–11–30
  2. By: Pierre Lesuisse (CERDI - Centre d'Etudes et de Recherches sur le Développement International - CNRS - Université d'Auvergne)
    Abstract: Few countries are part of the European Union but on the verge of the Euro-zone. This study aims at identifying the amplitude of the direct ECB monetary policy impact, i.e. the so-called international monetary spillovers, in Central and Eastern European countries (CEECs). The use of a panel-VAR method allows to deal with the small time span and endogeneity. We found that CEECs tend to significantly converge in monetary terms to the ECB standards. The direct impact on real variables remains relatively weak but contrary to the literature, is significant and in line with expectations. A persistent negative adjustment of GDP gives a quick glimpse of a robust reaction against monetary shock when the focus is made on the post-economic crisis period. The exchange rate regime plays a small but significant role in terms of magnitude. This increased interdependence is the result of macroeconomic reforms implemented during the last 25 years.
    Keywords: Monetary integration,External shocks,Panel VAR.
    Date: 2017–02–14
  3. By: Gao, Yuning; Lu, Yufeng; Meng, Bo; Yu, Miao
    Abstract: This paper recalculates value added, capital formation, capital stock, and related multifactor productivity for China's provinces by expanding on the genuine savings method proposed by the World Bank. Specifically, we construct China's time-series multiregional input?output tables to account for the natural resource depletion and environmental damage that affect genuine output when considering inter-provincial trade. The results show that although the loss of natural capital in China's provinces in terms of value added and investment has declined, the impact on productivity during the past decades is still significant and has even increased during the past decades.
    Keywords: Productivity, Input-output tables, Sustainable development, Genuine savings method, Total factor productivity, China
    JEL: D24 D57 O47 Q01
    Date: 2017–03
  4. By: Hoken, Hisatoshi
    Abstract: This study investigates the long-term trends of labor allocation in rural households of China from the late 1980s until the mid-2010s, and examines the determinants of their off-farm employment in 2002 and 2013 using the nationally representative household survey (CHIP). The estimated results indicate that working status of whether a person is employed showed the coefficients on age and education have an inverse-U-shaped relationship with employment probability for both years. The estimated results of the Tobit model of off-farm workdays as a percentage share of total workdays show that female labor was more strongly influenced by household characteristics and political networks than male labor in 2002, but no clear gender gaps were observed in 2013. This appears mainly due to the relative scarcity of off-farm employment in the early 2000s; therefore, women tended to take charge of domestic work such as child care and agricultural production. With the increase of off-farm work and the liberalization of grain marketing, the division of labor between genders has become less apparent.
    Keywords: Agricultural laborers, Rural economy, Labor conditions, Gender, China, Rural inequality, Labor allocation, Off-farm work
    JEL: J22 J71 N35 O15
    Date: 2017–03
  5. By: Bao, Helen X. H. (Asian Development Bank Institute); Meng, Charlotte Chunming (Asian Development Bank Institute)
    Abstract: Loss aversion is a core concept in prospect theory that refers to people’s asymmetric attitudes with respect to gains and losses. More specifically, losses loom larger than gains. With the capability of loss aversion to explain economic phenomena, some of which are puzzling under expected utility theory, this concept has received significant attention. We develop a behavioral model of loss aversion to explain the development decisions by residential property developers in the People’s Republic of China. Under the leasehold property right system, real estate development has two stages—first to lease land from the government, and then to develop the property according to the lease terms. This presents a unique opportunity to test the presence and effect of loss aversion in real estate development decisions. More specifically, we determine when the land premium paid by a developer is substantially higher than the market value, whether and how this “paper loss” will affect the pricing of the housing products and development time of the project in future development. We use a sample of land and house transaction records from Beijing to test the hypothesis. This is the first study to use a semi-parametric model in estimating developers’ loss aversion. Results show that developers are most prone to loss aversion bias around the reference point or when facing large losses. The results also suggest that loss aversion contributes to the cyclical trading pattern in housing markets.
    Keywords: loss aversion; real estate; residential property; housing; housing prices; housing market; semi-parametric estimation
    JEL: C14 D81 R31
    Date: 2017–01–18

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