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on Transition Economics |
| By: | Paweł Strzelecki (Narodowy Bank Polski); Jakub Growiec (Narodowy Bank Polski); Robert Wyszyński (Narodowy Bank Polski) |
| Abstract: | Since 2014 Poland witnessed an unprecedented inflow of immigrant workers from Ukraine. Coupled with strong labour demand, this surge in labour supply provided a major contribution to Poland’s economic growth. However, due to problems with capturing immigration in Labour Force Survey (LFS) data this contribution has remained hitherto largely unaccounted in official data. In this paper we use a range of alternative official data sources to estimate the actual number of immigrants, and survey data on migrant characteristics, collected in four Polish cities, to estimate the effective labour supply of Ukrainian immigrants in terms of productivityadjusted hours worked. We find that the arrival of Ukrainian workers was increasing the effective labour supply in Poland in 2013-18 by 0.8% per annum. Imputing this additional labour supply in a growth accounting exercise we find that the (previously unaccounted) contribution of Ukrainian workers amounted to about 0.5 pp. per annum, i.e., about 13% of Poland’s GDP growth in 2013-18. The same figure should be subtracted from the residual contribution of total factor productivity (TFP) growth, suggesting that recent growth in Poland has been in fact much more labour-intensive than previously interpreted. |
| Keywords: | growth accounting, immigration, labour input, Poland, Ukraine |
| JEL: | E24 O47 F22 O15 |
| Date: | 2020 |
| URL: | http://d.repec.org/n?u=RePEc:nbp:nbpmis:322&r=all |
| By: | Yanan Li; Chunbing Xing |
| Abstract: | In this paper, we analyse the relationship between China's structural transformation and the inclusiveness of its economic growth. China's economy has undergone significant structural changes since it initiated the economic reforms in 1978. Economic activities have shifted from the low-productivity agricultural sector to the high-productivity industrial sector and, more recently, the tertiary sector, with a large portion of the labour force moving from rural to urban areas, from inland to coastal regions, and from the public to the private sectors. |
| Keywords: | Inequality, Education, Migration, Poverty reduction, China |
| Date: | 2020 |
| URL: | http://d.repec.org/n?u=RePEc:unu:wpaper:wp-2020-33&r=all |
| By: | Igor Fedotenkov (Joint Research Center, European Commission, Rue du Champ de Mars, 21, 1050 Brussels, Belgium); Rangan Gupta (Department of Economics, University of Pretoria, Pretoria, 0002, South Africa) |
| Abstract: | In this paper, we analyse the effects of public expenditures and their structure on productivity growth in industry and services in the European Union (EU) countries. We also control for the share of expenditures made by central governments. We find that productivity growth in industry decreases with government expenditures on environmental protection and increases with the decentralisation of government expenditures on recreation, culture and religion. As for services, productivity growth declines with military expenditures and increases with the centralisation of expenditures on public order and safety, and with the decentralisation of expenditures on economic affairs. The former two effects are mainly noted in Eastern European countries, while the latter is stronger in Western Europe. Lower corruption increases productivity growth. Furthermore, our estimates suggest that there is a convergence in productivities across EU member states, with convergence faster in the service sector than in the industrial sector. These findings carry important policy implications. |
| Keywords: | Labour productivity, government expenditures, decentralisation, services |
| JEL: | E24 E62 H50 H76 O14 |
| Date: | 2020–05 |
| URL: | http://d.repec.org/n?u=RePEc:pre:wpaper:202038&r=all |
| By: | Sierž Naurodski; Aleœ Alachnoviè; Izabela Styczyñska; Krzysztof G³owacki; Jaros³aw Neneman; Pawel Swianiewicz; Andrzej Raczko; Kateryna Karunska |
| Abstract: | Belarusian economy has been stagnating in 2011-2015 after 15 years of a high annual average growth rate. In 2015, after four years of stagnation, the Belarusian economy slid into a recession, its first since 1996, and experienced both cyclical and structural recessions. Since 2015, the Belarusian government and the National Bank of Belarus have been giving economic reforms a good chance thanks to gradual but consistent actions aimed at maintaining macroeconomic stability and economic liberalization. It seems that the economic authorities have sustained more transformation efforts during 2015-2018 than in the previous 24 years since 1991. As the relative welfare level in Belarus is currently 64% compared to the Central and Eastern Europe (CEE) countries average, Belarus needs to build stronger fundaments of sustainable growth by continuing and accelerating the implementation of institutional transformation, primarily by fostering elimination of existing administrative mechanisms of inefficient resource allocation. Based on the experience of the CEE countries’ economic transformation, we highlight five lessons for the purpose of the economic reforms that Belarus still faces today: keeping macroeconomic stability, restructuring and improving the governance of state-owned enterprises, developing the financial market, increasing taxation efficiency, and deepening fiscal decentralization. |
| Keywords: | economic transformation, post-communist transition, Belarus, Poland |
| JEL: | P1 P2 P3 |
| Date: | 2020 |
| URL: | http://d.repec.org/n?u=RePEc:sec:worpap:0011&r=all |
| By: | Minford, Patrick (Cardiff Business School); Gai, Yue (Cardiff Business School); Ou, Zhirong (Cardiff Business School) |
| Abstract: | This paper investigates whether housing collateral is important to the business cycle in China. We develop two models, one without housing collateral as benchmark and one variant allowing for it. Indirect Inference procedure tests these two modelsÕ compatibility with the data. We find that the benchmark model passes the test, while the collateral model is strongly rejected. According to the benchmark model, shocks from the housing market have limited impact on the Chinese business cycle. By contrast, the exogenous spending shock from gov- ernment and net exports, the monetary policy shock and the goods-sector cost/productivity shock, all in turn most likely connected to world business cycle shocks (especially the global financial crisis), are found to be the main drivers. |
| Keywords: | Housing market; DSGE model; Housing collateral; Indirect Inference; China; |
| JEL: | E32 E44 E52 R31 |
| Date: | 2020–05 |
| URL: | http://d.repec.org/n?u=RePEc:cdf:wpaper:2020/6&r=all |
| By: | Heinrich, Torsten; Yang, Jangho; Dai, Shuanping |
| Abstract: | We investigate structural change in the PR China during a period of particularly rapid growth 1998-2014. For this, we utilize sectoral data from the World Input-Output Database and firm-level data from the Chinese Industrial Enterprise Database. Starting with correlation laws known from the literature (Fabricant's laws), we investigate which empirical regularities hold at the sectoral level and show that many of these correlations cannot be recovered at the firm level. For a more detailed analysis, we propose a multi-level framework, which is validated with empirically. For this, we perform a robust regression, since various input variables at the firm-level as well as the residuals of exploratory OLS regressions are found to be heavy-tailed. We conclude that Fabricant's laws and other regularities are primarily characteristics of the sectoral level which rely on aspects like infrastructure, technology level, innovation capabilities, and the knowledge base of the relevant labor force. We illustrate our analysis by showing the development of some of the larger sectors in detail and offer some policy implications in the context of development economics, evolutionary economics, and industrial organization. |
| Keywords: | Structural change; Fabricant's laws; China; labor productivity; economic growth; firm growth |
| JEL: | L11 L16 O10 O30 O53 |
| Date: | 2020–05–04 |
| URL: | http://d.repec.org/n?u=RePEc:pra:mprapa:100106&r=all |
| By: | Cseres-Gergely, Zsombor (European Commission); Kvedaras, Virmantas (European Commission) |
| Abstract: | Exports from China have surged substantially since its accession to the World Trade Organization in 2001. We investigate how this expansion affected income inequality within European regions by separating the trade pressure experienced in external and domestic markets, as well as exploring the importance of several economic mechanisms. Despite some intermediate adjustments, softening the influence of Chinese pressure and even facilitating European exports, we establish a significant increase of inequality that is concentrated mostly in the lower part of regional income distributions. We determine a significant channeling of the trade pressure to income inequality through the shrinking manufacturing sector, the increasing unemployment rate, and the technological upgrade of manufacturing exports, together with an increasing demand for better-qualified labor |
| Keywords: | China, EU, globalization, income, inequality, regions, trade |
| JEL: | D31 D63 F16 F61 |
| Date: | 2020–05 |
| URL: | http://d.repec.org/n?u=RePEc:jrs:wpaper:202001&r=all |
| By: | Claudiu Albulescu (CRIEF - Centre de Recherche sur l'Intégration Economique et Financière - Université de Poitiers) |
| Abstract: | Using data on 17 listed public banks from Russia over the period 2008 to 2016, we analyze whether international oil prices affect the bank stability in an oil-dependent country. We posit that a decrease in international oil prices has a negative long-run macroeconomic impact for an oil-exporting country, which further deteriorates the bank financial stability. More specifically, a decrease in international oil prices leads for an oil-exporting country as Russia to a currency depreciation and to a deterioration of the fiscal stance. In addition, given the positive correlation of oil and stock prices documented by numerous previous studies, a decrease in international oil prices represents a negative signal for the stock markets investors, negatively affecting banks' share prices and thus, their capacity to generate sustainable earnings. In this context, the bank financial stability can be menaced. With a focus on public listed banks and using a Pool Mean Group (PMG) estimator, we show that an increase in international oil prices and in the price to book value ratio has a long-run positive effect on Russian public banks stability, and conversely. While positive oil-price shocks contribute to bank stability in the long run, an opposite effect is recorded for negative shocks. However, no significant impact is documented in the short run. Our findings are robust to different bank stability specifications, different samples and control variables. |
| Keywords: | bank financial stability,international oil prices,bank valuation,Russian public banks,panel data estimation |
| Date: | 2020–04–25 |
| URL: | http://d.repec.org/n?u=RePEc:hal:wpaper:hal-02554299&r=all |
| By: | Thomas MÉLONIO; Marine BERTUZZI |
| Abstract: | The study of China’s international financial flows shows that it has become a major player in international financing. With the Belt and Road Initiative, China has promoted a narrative of development based primarily on economic growth, interconnectedness through transport infrastructure, and commercial trade. At the Second Belt and Road Forum in April 2019, the Chinese authorities declared their wish to focus on issues related to financial and environmental sustainability, planning a move towards a “higher quality” Belt and Road Initiative. This discourse provides an opportunity for increased dialogue and greater cooperation with other actors involved in development finance, although this presupposes a convergence in the financial, social, and environmental practices of Chinese and non-Chinese financial actors. This article makes a number of recommendations for creating these new convergences, and offers some approaches to a common framework for sustainable finance and development. |
| JEL: | Q |
| Date: | 2019–11–04 |
| URL: | http://d.repec.org/n?u=RePEc:avg:wpaper:en10419&r=all |
| By: | Dmitri Jegorov; Anna Leszczyłowska; Aleksander Łożykowski |
| Abstract: | Estonia has Europe’s most transparent tax system (while Poland is second-to-last, in 35th place), and is also known for its pioneering approach to taxation of legal persons’ income. Since 2000, payers of Estonian corporate tax don’t pay tax on their profits as long as they don’t realize them. In principle, this approach should make access to capital easier, spark investment by companies and contribute to faster economic growth. Are these and other positive effects really noticeable in Estonia? Have other countries followed in this country’s footsteps? Would deferment of income tax be possible and beneficial for Poland? How would this affect revenue from tax on corporate profits? Would investors come to see Poland as a tax haven? Does the Estonian system limit tax avoidance and evasion, or actually the opposite? Is such a system fair? Are intermediate solutions possible, which would combine the strengths or limit the weaknesses of the classical and Estonian models of profit tax? |
| Keywords: | corporate income tax, distributed profit tax, dividend tax, cash flow tax, Estonia |
| JEL: | H25 H32 M48 |
| Date: | 2020–04–09 |
| URL: | http://d.repec.org/n?u=RePEc:sec:mbanks:0163&r=all |
| By: | Michał Brzoza-Brzezina; Jacek Kotłowski |
| Abstract: | The economic literature has for a long time been looking for explanations of a very strong international correlation of business cycles. This paper shows empirically that common fluctuations can to some degree be the effect of confidence shocks beeing transmitted internationally. We focus on a large (euro area) and a small, nearby economy (Poland). Our results show that euro area confidence fluctuations account for approximately 40-70% of business cycle fluctuations both in the euro area and in Poland. More importantly, their transmission happens not only via traditional channels (e.g. by confidence affecting euro area GDP and then Polish GDP via trade), but to a large extent occurs directly (e.g. by news spreading via media). |
| Keywords: | International spillovers, animal spirits, sentiments, business cycle |
| JEL: | C32 E32 F44 |
| Date: | 2020–05 |
| URL: | http://d.repec.org/n?u=RePEc:sgh:kaewps:2020049&r=all |
| By: | Qiu, Yun (Jinan University); Chen, Xi (Yale University); Shi, Wei (Jinan University) |
| Abstract: | This paper models the local and cross-city transmissions of the novel coronavirus in China between January 19 and February 29 in 2020. We examine the role of various socioeconomic mediating factors, including public health measures that encourage social distancing in local communities. Weather characteristics two weeks ago are used as instrumental variables for causal inference. Stringent quarantine, city lockdown, and local public health measures imposed since late January significantly decreased the virus transmission rate. The virus spread was contained by the middle of February. Population outflow from the outbreak source region posed a higher risk to the destination regions than other factors including geographic proximity and similarity in economic conditions. We quantify the effects of different public health measures in reducing the number of infections through counterfactual analyses. Over 1.4 million infections and 56,000 deaths could have been avoided as a result of the national and provincial public health measures imposed in late January in China. |
| Keywords: | 2019 novel coronavirus, transmission, quarantine, COVID-19 |
| JEL: | I18 I12 C23 |
| Date: | 2020–04 |
| URL: | http://d.repec.org/n?u=RePEc:iza:izadps:dp13165&r=all |