|
on Transition Economics |
| By: | Anders Aslund |
| Abstract: | A conundrum this paper aims to explain is how Russia, a country that pursues such rigorous and conservative macroeconomic policies can be so tolerant of state and crony capitalism. The key issue is what Putin’s economic model amounts to, which is being presented already in section one. Section two reviews Russia’s recent economic performance, while the three ensuing sections examine three key aspects of the Russian economy, namely the eminent macroeconomic policy, the role of energy, and the impact of the Western sanctions since 2014. The final section attempts to answer the likelihood of serious market reforms. |
| Keywords: | Russia, crony capitalism, corruption, macroeconomic policy, economic growth, gas and oil |
| JEL: | D72 D73 E01 E60 E65 H63 P48 Q43 |
| Date: | 2017–09 |
| URL: | http://d.repec.org/n?u=RePEc:sec:mbanks:0148&r=tra |
| By: | Adhikari, Bibek; Alm, James |
| Abstract: | Tax reforms are often motivated by their potential to improve economic performance. However,their actual impacts are difficult to quantify. We analyze the impact of flat tax reform on incomes using “synthetic control†methods. We identify the 8 Eastern and Central European countries that adopted flat tax systems between 1994 and 2005, and then compare post-reform GDP per capita of “treated†countries with a convex combination of similar but “untreated†countries, while accounting for the time-varying impact of unobservable heterogeneity. We find positive impacts in all 8 countries, with 7 out of 8 cases significant at the conventional level. |
| Keywords: | Flat tax, Tax reform, Synthetic control methods, |
| Date: | 2017 |
| URL: | http://d.repec.org/n?u=RePEc:vuw:vuwcpf:6770&r=tra |
| By: | Davor Kunovac (The Croatian National Bank, Croatia); Nina Pavić (The Croatian National Bank, Croatia) |
| Abstract: | The paper analyses the impact of euro adoption on the reduction of borrowing costs of EU member states. The results of the analysis point to the existence of a "euro premium" – after controlling for the dynamics in the macroeconomic fundamentals of particular countries and the market sentiment, member states of the monetary union have, on average, lower borrowing costs and higher credit ratings than other EU member states. In order to draw attention to the significance that the results could have for bank interest rates in Croatia in the event of euro adoption, a simple VAR model is used to demonstrate that there is a statistically significant transmission of the changes in government borrowing costs to interest rates on bank loans. |
| Keywords: | euro, borrowing costs, CDS premium, credit rating, Croatia |
| JEL: | E42 |
| Date: | 2017–11 |
| URL: | http://d.repec.org/n?u=RePEc:hnb:survey:28&r=tra |
| By: | Nataliya Karlova (Bank of Russia, Russian Federation); Irina Bogacheva (Bank of Russia, Russian Federation); Elena Puzanova (Bank of Russia, Russian Federation) |
| Abstract: | Inflation inertia hinders the process of slowing down inflation to meet the target level and thus lowers the effectiveness of monetary policy. Widespread methods of assessing the observed inflation inertia using different models can’t clear up important aspects, such as between-industry analysis based on firm-specific characteristics and, consequently, the speed of response to external shocks in different sectors. The paper investigates the pricing behaviour of firms on the basis of a survey of companies’ conducted by the Bank of Russia. According to the results the main drivers of inflation (price) inertia (or delayed and prolonged response of inflation to shocks) in Russia are backwardlooking (or adaptive) expectations of economic agents, inflexible pricing policy, and wage indexation based on past inflation level. It is important for central banks to understand these processes in order to implement and maintain the effective monetary policy. |
| Keywords: | price inertia, price-setting behaviour of companies, inflation expectations, Inflexible pricing policy, survey of companies, Russia |
| Date: | 2017–11 |
| URL: | http://d.repec.org/n?u=RePEc:bkr:wpaper:note9&r=tra |
| By: | International Monetary Fund |
| Abstract: | Armenia has made significant strides in enhancing macroeconomic stability over the past two decades. This has recently come under strain. Before a full recovery from the Global Financial Crisis (GFC) could take root, a second wave of external shocks, resulting from the slowdown in Russia and the ensuing sharp currency depreciation, buffeted the economy. Armenian public finances have deteriorated steadily since 2013, triggering the debt brake mechanism in 2016. |
| Keywords: | Armenia;Middle East; |
| Date: | 2017–11–10 |
| URL: | http://d.repec.org/n?u=RePEc:imf:imfscr:17/330&r=tra |
| By: | Naomitsu Yashiro; Konstantins Benkovskis; Jaan Masso; Olegs Tkacevs; Priit Vahter |
| Abstract: | This paper investigates the effect of export entry on productivity, employment and wages of Latvian and Estonian firms in the context of global value chain (GVC). Like in many countries, exporting firms in Latvia and Estonia are more productive, larger, pay higher wages and are more capital intensive than non-exporting firms. While this is partly because firms that are originally more productive and have better performances are more likely to enter export, Latvian and Estonian firms also realise more than 23% and 14% higher labour productivity level as the result of export entry. Export entry also increases employment and average wages. Gains in productivity and employment are particularly large when firms enter exports that are related to participation in knowledge-intensive activities found in the upstream of GVC. For instance, Latvian firms that start exporting intermediate goods or non-transport services (which include knowledge intensive services) enjoy significantly higher productivity gains than those starting to export final goods or transport services. These findings underscore the importance of innovation policies that strengthen firms’ capabilities to supply highly differentiated knowledge-intensive goods and services to GVC. |
| Keywords: | estonia, export, global value chain, latvia, productivity |
| JEL: | F12 F14 O19 O57 |
| Date: | 2017–12–15 |
| URL: | http://d.repec.org/n?u=RePEc:oec:ecoaaa:1448-en&r=tra |
| By: | Xavier Oudin (LEDa - Laboratoire d'Economie de Dauphine - Université Paris-Dauphine); Laure Pasquier-Doumer (LEDa - Laboratoire d'Economie de Dauphine - Université Paris-Dauphine); Thai Pham Minh (autre - AUTRES); François Roubaud (LEDa - Laboratoire d'Economie de Dauphine - Université Paris-Dauphine) |
| Abstract: | In this paper, we consider how labour market adjusts to economic fluctuations, considering structural transformation at work as well as short term changes. We utilise series calculated from population censuses and data published in the statistical yearbooks of GSO for long term series, and Labour Force Surveys from 2007 to 2012 for short term data. The paper highlights the deep transformation of the labour market in the last decades. The labour force has doubled in 25 years and the share of agriculture has declined below 50%. Labour supply absorption was thus one of the main challenges for the Vietnamese economy. The household sector has been the main job provider over the years, in agriculture as well as in non-farm activities. The labour market has adjusted to the recent economic slowdown through different channels. If unemployment does not rise, some people withdraw from the labour force and the number of non-active people has grown. The quantity of labour is also affected by a significant reduction of hours worked. While the non-farm sector generates more jobs for skilled workers, there is a shift of unskilled labour towards agriculture. Due to demographic factors, labour supply absorption and creation of new jobs become a less acute problem. As Vietnam benefits of the demographic dividend, the situation on the labour market should be favourable during the present decade to implement structural policies. |
| Abstract: | Dans cet article, nous examinons les ajustements du marché du travail aux fluctuations économiques, compte tenu des transformations structurelles en cours ainsi que des changements à court terme. Nous utilisons pour cela des données des recensements de la population ou publiées dans les annuaires statistiques de l’Office Général de la Statistique pour les séries à long terme, et les enquêtes emploi conduites entre 2007 à 2012 pour les données à court terme. Cet article souligne la profonde transformation du marché du travail au cours des dernières décennies. La population active a doublé en 25 ans et la part de l'agriculture est passée en dessous du seuil de 50 %. L’absorption de l'offre de travail a donc été l'un des principaux défis pour l'économie vietnamienne sur cette période. Le secteur des entreprises familiales agricoles et non-agricoles a été le principal pourvoyeur d'emplois au cours de ces années. Le marché du travail s'est adapté au récent ralentissement économique à travers différents canaux. Le chômage est resté stable mais le nombre de personnes inactives a augmenté. La quantité de travail a également été affectée par une réduction significative du nombre d'heures travaillées. Alors que le secteur non agricole a généré plus d'emplois pour les travailleurs qualifiés, un flux de travailleurs non-qualifiés vers l’agriculture a été observé. En raison de facteurs démographiques, l'absorption de l'offre de travail et la création de nouveaux emplois ne sont plus le principal problème. En revanche, l’évolution récente du marché du travail appelle à la mise en oeuvre de politiques structurelles en vue d’améliorer les conditions de travail, la période étant particulièrement favorable pour mener ces politiques puisque le Vietnam profite actuellement du dividende démographique. |
| Keywords: | Marché du travail,Ajustement à long et court terme,Emploi,Labour Market,Long term and Short term Adjustment,Employment,Vietnam |
| Date: | 2017–11–28 |
| URL: | http://d.repec.org/n?u=RePEc:hal:wpaper:hal-01650994&r=tra |
| By: | Frantisek Brazdik; Michal Franta |
| Abstract: | Bayesian vector autoregressions (BVAR) have turned out to be useful for medium-term macroeconomic forecasting. Several features of the Czech economy strengthen the rationale for using this approach. These include in particular the short time series available and uncertainty about long-run trends. We compare forecasts based on a small-scale mean-adjusted BVAR with the official forecasts published by the Czech National Bank (CNB) over the period 2008q3-2016q4. The comparison demonstrates that the BVAR approach can provide more precise inflation forecasts over the monetary policy horizon. For other macroeconomic variables, the CNB forecasts either outperform or are comparable with the forecasts based on the BVAR model. |
| Keywords: | BVAR, forecast evaluation, inflation targeting, real-time forecasting |
| JEL: | E37 E52 |
| Date: | 2017–11 |
| URL: | http://d.repec.org/n?u=RePEc:cnb:wpaper:2017/7&r=tra |
| By: | Mamedli Mariam (Bank of Russia, Russian Federation); Andrey Sinyakov (Bank of Russia, Russian Federation) |
| Abstract: | As our calculations show, borrowers with incomes above the median level, who did not apply for loans earlier, could represent 2/3 of extensive growth in the volume of consumer lending. But in the new environment it is difficult to rely on individuals who did not apply for loans even during the boom period of 2010-2012, in the context of rising oil prices and growing incomes. Banks’ choice of this area will necessitate additional costs that will make credit more expensive and thus less attractive to this group. As regards intensive credit growth, the debt burden of borrowers with incomes below the median level has growth potential. Due to the interestrate sensitivity of this group’s demand for credit, the Bank of Russia’s transition to a neutral key rate may provide some support to credit growth, provided that banks are willing to choose business models with lower profit margins. Macroprudential policy measures can incentivise banks to adapt less risky business models, helping them lower interest rates and thus making loans more attractive to creditworthy borrowers. The identified structural features of loan supply and demand make it possible to draw a number of conclusions for the regulator’s policy: 1. The transmission of monetary policy to consumer lending may prove weaker than commonly assumed. First, the reduction of the key rate by the Bank of Russia may modestly translate to a decline in banks’ interest rates due to the fact that high interest rates reflect the particularity of banks’ business models, which target high-risk borrowers. In order to enhance the trans mission, banks will have to adapt to a different model. Second, the level of loan interest rates per se has only a limited impact on demand for loans of this kind, the structures of which are governed to a significant extent by demand from low-income borrowers who are largely insensitive to interest rate levels. 2. The growth of lending in a context of magnified inflation expectations facilitates the accumulation of vulnerabilities in the consumer lending segment, posing risks to financial stability and requiring macroprudential policy adjustment. Magnified inflation expectations can prompt borrowers who evaluate real interest rates as extremely low to take further risks and accumulate excess debt. When these borrowers possess predominantly low and unstable incomes that are sensitive to macroeconomic shocks, banks find themselves exposed to increased credit risks, which, in certain circumstances, can have systemic consequences. In these situations, macroprudential policy measures are capable of protecting both banks and borrowers from taking excess risks, directing banks towards less risky groups of borrowers and thus increasing their resilience in the new environment. |
| Date: | 2017–09 |
| URL: | http://d.repec.org/n?u=RePEc:bkr:wpaper:note10&r=tra |
| By: | Vasily Astrov (The Vienna Institute for International Economic Studies, wiiw); Leon Podkaminer (The Vienna Institute for International Economic Studies, wiiw) |
| Abstract: | Following the ‘Maidan revolution’ of February 2014, the National Bank of Ukraine (NBU) abandoned the exchange rate peg to the US dollar and switched to a flexible exchange rate, which was later formalised within the framework of the newly adopted inflation targeting regime. Our analysis suggests that this move has been questionable and, at the very least, premature. First, the presumed success of inflation targeting as a universally applicable ‘magical tool’ to reach low and stable levels of inflation in many countries has in reality been largely due to other factors rather than the inflation targeting concept. Second, the NBU’s announced inflation target (5% in the medium term) appears to be overly ambitious given Ukraine’s development level. Experience from other countries suggests that sticking to this target at all cost will likely require a consistently overly restrictive monetary policy, which will constrain Ukraine’s growth prospects. Last but not least, as capital controls are gradually eased, the exchange rate will likely become vulnerable to speculative attacks once again, given the numerous political and geopolitical uncertainties and the ‘thinness’ of the country’s foreign exchange market. Attempts at macroeconomic stabilisation in response to such exchange rate shocks by using ‘classical’ inflation targeting instruments such as interest rates will have a pro-cyclical impact, given the high degree of dollarisation and the related prevalence of so-called ‘balance sheet effects’. The experience of other countries in similar circumstances – both in Central and Eastern Europe and elsewhere – suggests that a preferable strategy would be to smooth exchange rate fluctuations via interventions rather than monetary policy instruments. For this, a certain minimum level of reserves is needed; the latter will not only provide the necessary policy space for interventions should such a need arise, but should discourage speculations against the currency in the first place. Another major reform effort undertaken recently (October 2017) has been a comprehensive pension reform, which envisaged most notably a gradual increase in the effective retirement age. Our analysis suggests that the current situation in Ukraine’s pension system hardly justifies such a step. The country’s statutory retirement age may be indeed rather low, but it is more than offset by the low life expectancy of Ukrainians, and the share of pensioners in the total population is not particularly high by international standards. Besides, while Ukraine’s Pension Fund may be in deficit, this is not very different from the situation observed in other countries, and there are no theoretical arguments why the Pension Fund must be necessarily balanced. Finally, the sustainability of the pension system is not necessarily a cause of major concern either, taking into account the likely future improvements in the labour market. To the extent that any reform of the pension system is needed at all, it should target above all efforts to curb the shadow economy and/or partial reversion of last year’s cuts in social security contributions. |
| Keywords: | monetary policy, inflation targeting, pension systems |
| JEL: | E52 E58 H55 |
| Date: | 2017–12 |
| URL: | http://d.repec.org/n?u=RePEc:wii:pnotes:pn:19&r=tra |
| By: | Mikosch, Heiner; Solanko, Laura |
| Abstract: | GDP forecasters face tough choices over which leading indicators to follow and which forecasting models to use. To help resolve these issues, we examine a range of monthly indicators to forecast quarterly GDP growth in a major emerging economy, Russia. Numerous useful indicators are identified and forecast pooling of three model classes (bridge models, MIDAS models and unrestricted mixed-frequency models) are shown to outperform simple benchmark models. We further separately examine forecast accuracy of each of the three model classes. Our results show that differences in performance of model classes are generally small, but for the period covering the Great Recession unrestricted mixed-frequency models and MIDAS models clearly outperform bridge models. Notably, the sets of top-performing indicators differ for our two subsample observation periods (2008Q1–2011Q4 and 2012Q1–2016Q4). The best indicators in the first period are traditional real-sector variables, while those in the second period consist largely of monetary, banking sector and financial market variables. This finding supports the notion that highly volatile periods of recession and subsequent recovery are driven by forces other than those that prevail in more normal times. The results further suggest that the driving forces of the Russian economy have changed since the global financial crisis. |
| JEL: | C53 E27 |
| Date: | 2017–11–30 |
| URL: | http://d.repec.org/n?u=RePEc:bof:bofitp:2017_019&r=tra |
| By: | Dunsch, Sophie |
| Abstract: | The unemployment rates, especially youth unemployment rates, increased in various countries of Europe over the last years. This paper examines gender-specific youth unemployment developments in Germany and Poland with Okun's law to test the hypothesis that young male employees are more vulnerable to the business cycle. I estimate gender- and country-specific Okun coefficients for five different age cohorts. The results show that young men are more sensitive to the business cycle, while for women the reaction is less strong. A further examination of the different labour markets regarding genderspecific youth employment results in policy recommendations beyond GDP growth, such as a reduction of the discrepancy in employment protection between permanent and temporary contracts and an approach to maintain youth connected to the labour market. |
| Keywords: | Youth Unemployment,Okun's Law,Poland,Germany |
| JEL: | E24 E32 J64 |
| Date: | 2017 |
| URL: | http://d.repec.org/n?u=RePEc:zbw:euvwdp:397&r=tra |
| By: | Fernanda Ilhéu; Gonçalo Simões |
| Abstract: | China is a market ripe with opportunities for those who dare challenge its vastness; its alluring promise of an outstanding growth possibility thanks to its immense and growing internal market presents itself to companies as a place of both enormous challenges but also of potentially great rewards. The logistics sector is considered to be one essential vector of competitiveness for the development of consumer market supply. Logistics plays a tremendously important role in a company’s activity. Poor logistics can lead to lost opportunities and unsatisfied customers, among other things, while having a good logistics system in place might work as a source of competitive advantage. Ilhéu (2006) research concluded that the Chinese logistics and distribution system was one of the myriad problems Portuguese companies encountered when trying to establish a presence in China; poor infrastructure and a generalized lack of value-added services in Chinese logistics companies were some of the widespread problems faced. The highly fragmented nature of the current Chinese market, high road tolls or uneven taxes between provinces, all contribute to the maintenance of an inefficient system that imposes a disproportionately high cost of logistics in the country. A new era for logistics is being ushered in by China since competitiveness and e-commerce requires the modernization of infrastructures as a global mindset management. Some research questions then arise: are Chinese logistics still a burden to the efficiency of Chinese domestic market? How has the Chinese logistical sector progressed in the last eleven years? Is the lack of value-added services still perceived by foreign companies as a constraint to entering the Chinese market? |
| Date: | 2017–12 |
| URL: | http://d.repec.org/n?u=RePEc:cav:cavwpp:wp162&r=tra |
| By: | Funke, Michael; Leiva-Leon, Danilo; Tsang, Andrew |
| Abstract: | The recent increase in China’s house prices at the national level masks tremendous variation at the city level – a feature largely overlooked in the macroprudential literature. This paper considers the evolving heterogeneity in China’s house price dynamics across 70 cities and assess the main deter-minants. We gauge the heterogeneity of house price dynamics using a novel regime-switching modelling approach to estimate the time-varying patterns of China’s city-level housing price synchronization. After sorting city-level housing prices into four clusters sharing similar cyclical features, we see that each group shows increasing synchronization in the years leading up to 2015, and a decoupling pattern thereafter. We document high synchronization within each of the clusters of cities, but low synchronization among them. The empirical evidence suggests that differentials in the growth of households, income, investment and even differences in air quality explain housing price synchronization among cities. |
| JEL: | E31 E32 C32 |
| Date: | 2017–12–09 |
| URL: | http://d.repec.org/n?u=RePEc:bof:bofitp:2017_021&r=tra |
| By: | International Monetary Fund |
| Abstract: | The prolonged political uncertainty has taken a toll on economic growth, with investment suffering because of weak sentiment. With the formation of the new government, policies should now focus on rebuilding fiscal buffers and implementing critical reforms to rekindle growth and give EU accession prospects a new push. |
| URL: | http://d.repec.org/n?u=RePEc:imf:imfscr:17/354&r=tra |
| By: | Gary H. Jefferson (Brandeis University); Renai Jiang (Xi'an Jiaotong University); Lintong Li (Princeton University); Sam Zucker (Brandeis University) |
| Abstract: | This paper uses patent data from the U.S. Patent and Trademark Office to investigate the implications of inventor collaboration and joint assignee ownership, both domestic and international, on patent quality as measured by the number of claims and citations associated with a patent. Specifically, we compare the quality implications of research collaboration and joint ownership for the quality of U.S. and Chinese patents. Overall, we find that domestic inventor collaboration yields higher quality results for U.S. patents than Chinese patents. However, for China, international collaboration, both for inventors and assignee ownership is associated with higher quality outcomes for Chinese patents than for U.S. patents. We also find that the incidence of inventors sharing assignee ownership is significantly higher in China. We hypothesize that this difference reflects a need in China to extend patent ownership to inventors for the purpose of recruiting and incentivizing a relatively limited supply of high-quality researchers, whereas in the U.S. the abundance of such researchers is retained largely through wage and bonus compensation. |
| Date: | 2017–11 |
| URL: | http://d.repec.org/n?u=RePEc:brd:wpaper:117&r=tra |
| By: | Nguyen Thi Xuan, Thu; Pham Anh, Tuan; Phung Duy, Quang |
| Abstract: | SECO Working Paper 20/2017 by Quang Phung Duy, Tuan Pham Anh and Thu Nguyen Thi Xuan |
| Abstract: | This study examines determinants of intra-industry trade between Vietnam and ASEAN countries. By solving endogenous problems and applying a Hausman-Taylor model panel two-way dataset, we detect that export flows of Vietnam gravitate to neighbouring countries and those with similar GDP. More importantly, the research indicates the existence of spatial-lag interaction. |
| Date: | 2017–12–22 |
| URL: | http://d.repec.org/n?u=RePEc:wti:papers:1144&r=tra |
| By: | Huang, Dongya; Chen, Minglu; Heberer, Thomas |
| Abstract: | Existing scholarship regards the collusion between the Chinese government and the private sector as 'informal' and a series of 'economic alliances', without considering the private sector's institutionalized participation in the process of government policy formulation. This article takes an alternative perspective and examines such institutionalized efforts in interest expression and policy promotion. In the authoritarian regime, state institutions that previously functioned to co-opt and corporatize the private sector have also become forums in which private entrepreneurs can have an impact on policy-making. This change results from the state's initiative in developing formal channels of participation based on the united front work remnant and interaction between 'state control' and the 'business lobby'. The shift from 'state control' to the 'business lobby' reveals a unique pathway for private interest to have an impact on public policy formulation. |
| Keywords: | business lobbying,All-China Federation of Industry and Commerce,business associations,Chinese Political Consultative Conference |
| Date: | 2017 |
| URL: | http://d.repec.org/n?u=RePEc:zbw:udedao:1182017&r=tra |
| By: | A.S. Gogoleva (National Research University Higher School of Economics); E.S. Balabanova (National Research University Higher School of Economics); A.G. Efendiev (National Research University Higher School of Economics); V.V.Komarova (National Research University Higher School of Economics) |
| Abstract: | The paper investigates the questions about social organization of work behavior in the Russian companies. Focus in research was made on desirable and obligatory behavior, work standards and determinants of different types of organizational behavior. Survey of 1423 employees presents all key industries of the Russian business, performing within the main federal districts. The results show that the domination of the mercantile and consumer attitude to work as means of achievement of material welfare is not the socio-cultural phenomenon only, but also the result of social and economic conditions in the work sphere. The examined distinction of interests, demands and standards of behavior for representatives of various professions represents one of the deepest contradictions of the development processes of working sphere in Russian society. The research found out deep deformations in the sphere of working activity of employees in the Russian companies. |
| Keywords: | work behavior, extra-role behavior, EVLN, organizational citizenship behavior, role behavior. |
| JEL: | M12 O18 O32 |
| Date: | 2017 |
| URL: | http://d.repec.org/n?u=RePEc:hig:wpaper:56man2017&r=tra |
| By: | Möllers, Judith; Traikova, Diana; Herzfeld, Thomas; Bajrami, Egzon |
| Abstract: | Kosovo currently faces the challenge of reintegrating thousands of returned migrants who left the country in 2014 /2015. This migration wave was discussed in the IAMO Policy Brief 24. After facing restrictive asylum policies in the destination countries in Western Europe, more than 20,000 people returned to Kosovo in 2015 and 2016. Based on the results of an empirical survey of around 180 returnees, this policy brief discusses a number of reintegration issues. In addition to low levels of education and skills, reintegration is impeded above all by the precarious state of Kosovo's labour market. This is compounded by a psychological burden that often arises from the sometimes traumatic experience of migration and involuntary return. The migration of Kosovars is at risk of becoming a vicious cycle composed of involuntary return and problems reintegrating, resulting in a further attempt at migration. Indeed, the results of the study show that many returnees do not intend to remain in Kosovo. |
| Date: | 2017 |
| URL: | http://d.repec.org/n?u=RePEc:zbw:iamopb:33e&r=tra |
| By: | Tuan Anh Nguyen (University of Economics and Business, Vietnam National University, Hanoi, Vietnam and VietinBank Capital, VietinBank); Tuyen Quang Tran (University of Economics and Business, Vietnam National University, Hanoi); Huong Van Vu (Department of Economics, Academy of Finance, Hanoi, Vietnam); Dat Quoc Luu (University of Economics and Business, Vietnam National University, Hanoi, Vietnam) |
| Abstract: | Using a novel dataset involving 450 respondents living in affordable apartments in urban Hanoi, this study examines the level of housing satisfaction and its correlates. We find that housing satisfaction is positively associated with household income but negatively related to education. Interestingly, the study finds that residents borrowing from banks to buy home are less satisfied with their home than their non-borrowing counterparts. We also find that respondents’ positive evaluation of their apartments, such as the design, construction quality and price of apartments, are strongly linked with housing satisfaction. In addition, the location of and environmental quality surrounding the housing area were found to be major factors affecting housing satisfaction. |
| Keywords: | affordable apartment, housing satisfaction, social apartment, cheap commercial apartment. |
| JEL: | D4 D6 D11 |
| Date: | 2017–03 |
| URL: | http://d.repec.org/n?u=RePEc:dpc:wpaper:0317&r=tra |
| By: | Israel Marques II |
| Abstract: | How do political connections shape the propensity of firms to make investments in weakly institutionalized settings? Traditionally, absent ways to hold the state accountable, firms should withhold investment for fear of predation. An emerging body of work on the political economy of investment has highlighted the competitive advantages that direct political connections with officials can bring to firms in institutionally weak environments with low accountability. These advantages, particularly privileged protection of property rights, can decrease uncertainty and promote investment even absent traditional accountability mechanisms. This paper applies these insights to a particularly risky form of investment for firms: public-private partnerships (PPP) with the state to develop skill. Skill development investments are riskier than average, since they require firms to reveal trade secrets about their production, engage in long-term interactions, and can be poached by free-riding rival firms. This paper argues that these risks canbe overcome by a strong state partner (i.e. PPP), albeit this creates new risks in weakly institutionalized environments if the lower-level officials responsible for implementing agreements cannot be held accountable for agreements and can shirk. This paper argues that political connections provide the means for states to create credible commitment, as they give firms access to power that can enable them to monitor lower-level officials, call attention to misbehavior, and thus punish deviations from PPP agreements. It outlines the ways in which various types of political connections state ownership, direct officeholding, employing former officials, via formal consultative organs , and acquaintanceship can enable firms to hold lower-level officials accountable and engender credible commitment. These arguments are then tested using data from an original survey of 690 firms in 12 Russian regions. |
| Keywords: | Skill Development, Public-Private Partnerships, Political Connections, Institutional Quality, Credible Commitment, Firms, Russia |
| JEL: | D22 J24 I25 L21 L23 O12 P48 |
| Date: | 2017 |
| URL: | http://d.repec.org/n?u=RePEc:hig:wpaper:56/ps/2017&r=tra |
| By: | Aleksander £aszek |
| Abstract: | Poland’s structural deficit is one of the largest in the EU. While other Member States are taking action to reduce their deficits, the Polish government has not only introduced costly projects, but has also announced additional projects that will further aggravate the state of Polish public finances. The aim of maintaining the nominal deficit under 3% of GDP, as declared by the government, is insufficient because it does not leave a margin of safety in case of an economic slowdown. In the meantime, the turbulent global economy and the structural challenges the Polish economy is facing make the scenario of an economic slowdown increasingly plausible. Dr. Aleksander £aszek evaluates the government’s current policy through the lens of the challenges that stand a head of Polish economy, and its resilience to shocks, in the new mBank-CASE Seminar Proceedings "Economic policy, the international environment and the state of Poland’s public finances: Scenarios". |
| Keywords: | Public finance, general government debt, general government deficit, structural deficit |
| JEL: | E20 E62 E66 G21 G28 H24 H25 H3 H6 |
| Date: | 2017–03 |
| URL: | http://d.repec.org/n?u=RePEc:sec:mbanks:0146&r=tra |
| By: | Tom Coupe (University of Canterbury); Maksym Obrizan |
| Abstract: | In this paper, we analyse the life satisfaction of adolescents in transition countries, comparing their life satisfaction to the life satisfaction of their peers in non-transition countries. We find that at the start of transition, ceteris paribus, the life satisfaction of adolescents in our sample of transition countries did not differ much from the life satisfaction of adolescents in our sample of non-transition countries. With the economic crisis of the early nineties, however, the difference increased dramatically but by the beginning of the 2000s this gap had again become fairly limited. From that point, respondents’ health situation, their material wealth and their school experience mattered much more than where they lived. Unlike the literature on adults, we find that macro-variables cannot explain much of the happiness gap between transition and non-transition countries. |
| Keywords: | Happiness, Happiness gap, Transition countries |
| JEL: | I31 P20 |
| Date: | 2017–12–01 |
| URL: | http://d.repec.org/n?u=RePEc:cbt:econwp:17/15&r=tra |
| By: | Ding Ding; Xiaoyu Huang; Tao Jin; W. Raphael Lam |
| Abstract: | China’s real estate market rebounded sharply after a temporary slowdown in 2014-2015. This paper uses city-level data to estimate the range of house price overvaluation across city-tiers and assesses the main risks of a sharp housing market slowdown. If house prices rise further beyond “fundamental” levels and the bubble expands to smaller cities, it would increase the likelihood and costs of a sharp correction, which would weaken growth, undermine financial stability, reduce local government spending room, and spur capital outflows. Empirical analysis suggests that the increasing intensity of macroprudential policies tailored to local conditions is appropriate. The government should expand its toolkit to include additional macroprudential measures and push forward reforms to address the fundamental imbalances in the residential housing market. |
| Keywords: | Asia and Pacific;Macroprudential Policy;Central banks and their policies;China real estate market, housing bubbles, Monetary Policy (Targets, Instruments, and Effects), Housing Supply and Markets, Bayesian Analysis, Time-Series Models |
| Date: | 2017–11–16 |
| URL: | http://d.repec.org/n?u=RePEc:imf:imfwpa:17/248&r=tra |
| By: | Chu Thanh, Giang; Dinh Hoang, Anh; Nguyen Phuong, Linh |
| Abstract: | SECO Working Paper 18/2017 by Nguyen Phuong Linh, Dinh Hoang Anh and Chu Thanh Giang |
| Abstract: | Arbitration activities in Vietnam is becoming a popular choice of investors in dispute resolution. However, European investors in Vietnam repeatedly raised concerns that it is extremely difficult in practice to achieve the recognition and enforcement of foreign arbitral awards through the Vietnamese courts. Now the European - Vietnam Free Trade Agreement (EVFTA) which is expected to take effect in 2018 has imposed a new two-tier investment court system (ICS) for investors-States dispute settlement (ISDS) instead of traditional arbitration-based ISDS. This paper focuses on analysing the compatibility between the ICS mechanism and Vietnam legal framework and current practice in recognition and enforcement of foreign arbitral awards, thereby proposing some recommendations for Vietnam’s preparation with the EVFTA ahead. |
| Date: | 2017–12–13 |
| URL: | http://d.repec.org/n?u=RePEc:wti:papers:1135&r=tra |
| By: | Emiliano Magrini (Food and Agriculture Organization of the United Nations, Rome (IT).); Pierluigi Montalbano (Department of Economics and Social Sciences, Sapienza University of Rome (IT).); L. Alan Winters (Department of Economics, University of Sussex (UK)) |
| Abstract: | This paper assesses vulnerability from trade in Vietnam by presenting an extended version of Ligon and Schechter’s (2003) Vulnerability as low Expected Utility (VEU) measure. It uses the VHLSS panel data covering the period 2002-06. The empirical results show that risk-induced vulnerability and het-erogeneity in trade exposure matters in determining household overall vulnerability and that this is not linked to the actual manifestation of shocks. Although it does not represent, by any means, an argument against free trade, this work is relevant for policymaking since it contributes to deepen our knowledge on the subtle links between trade openness and vulnerability providing some insight on the stabilisation needs of trade reforms. These include protecting vulnerable farmers from excessive price volatility, as well as fostering their risk management strategies. |
| Keywords: | trade openness, vulnerability, poverty, risk, consumption behaviour, Vietnam. |
| JEL: | F14 O12 D12 C31 |
| Date: | 2017–11 |
| URL: | http://d.repec.org/n?u=RePEc:saq:wpaper:12/17&r=tra |