nep-tra New Economics Papers
on Transition Economics
Issue of 2020‒11‒23
ten papers chosen by
Maksym Obrizan
Kyiv School of Economics

  1. Heterogeneous effects of livelihood strategies on household well-being: An analysis using unconditional quantile regression with fixed effects By Tran, Tuyen; Vu, Huong
  2. The Health Consequence of Rising Housing Prices in China By Xu, Yuanwei; Wang, Feicheng
  3. Hukou Status, Housing Tenure Choice and Wealth Accumulation in Urban China By Liao, Yu; Zhang, Junfu
  4. NatCats and Insurance in a Developing Economy - New Theoretical and Empirical Evidence By Hott, Christian; Tran, Thi Xuyen
  5. Political connections and firm's formalization: Evidence from Vietnam By Duc Anh Dang; Hai Anh La
  6. Government financial support and firm productivity in Vietnam By Vu, Quang; Tran, Tuyen
  7. The heterogeneous effects of China's accession to the world trade organization By Jung, Benjamin
  8. Can Group Identity Explain Gender Gap in Recruitment Process? By Mavlikeeva, Maria; Asanov, Igor
  9. It's a man's world? The rise of female entrepreneurship during privatization in Serbia By Ivanović, Vladan; Kufenko, Vadim
  10. Do soda taxes affect the consumption and health of school-aged children? Evidence from France and Hungary By Gangl, Selina

  1. By: Tran, Tuyen; Vu, Huong
    Abstract: Using a household panel dataset for the 2008-2016 period, we analyze the heterogeneous effects of livelihood change on household well-being in rural Vietnam. We use an unconditional quantile regression (UQR) model with fixed effects to control for unobservable time-invariant household characteristics. We find that when a fixed-effects estimator is employed, households switching from a crop livelihood to any non-crop livelihood (e.g., livestock, wage-earning, nonfarm or private transfer livelihoods) increase their per capita income and food consumption. However, the results from the UQR with fixed effects reveal a significant variation in the effect of such a switch in livelihood across various quantiles of well-being distribution, with a larger effect for poorer households. The income effect, however, tends to decline with higher quantiles and even turns negative with a switch to a wage-earning or public transfer livelihood for the better off. Notably, our study confirms the advantage for the poor of changing livelihood from crop to non-crop activities in rural Vietnam. Our research results also suggest that a mean regression approach, that often assumes a homogeneous/mean effect of livelihoods on well-being, may miss some heterogeneity that is useful to researchers and policy makers.
    Keywords: Cluster analysis; fixed effects; food consumption; livelihood; unconditional quantile regression
    JEL: J1 J11 O1
    Date: 2019–12–15
  2. By: Xu, Yuanwei; Wang, Feicheng
    Abstract: China has experienced a rapid boom in real estate prices in the last few decades, leading to a substantial increase in living costs and heavy financial burdens on households. Using an instrumental variable approach, this paper exploits spatial and temporal variation in housing price appreciation linked to individual-level health data in China from 2000 to 2011. We find robust evidence that increases in housing prices significantly raise the probability of residents having chronic diseases. This negative health impact is more pronounced among individuals from low-income families, households that purchased rather than inherited or was allocated the home, and those who migrated from rural to urban areas. We also find evidence that marriage market competition exacerbates these negative health effects, particularly for males and parents with young adult sons. Further empirical results suggest that housing price appreciation induces negative health consequences through increased work intensity, higher mental stress, and reduced sleep time. This paper provides a novel explanation to the increased prevalence of chronic diseases in China.
    Keywords: Housing Prices,Chronic Diseases,Health,Marriage Competition,China
    JEL: R20 R21 R31 I12 I14 I15 I31
    Date: 2020
  3. By: Liao, Yu (Clark University); Zhang, Junfu (Clark University)
    Abstract: In Chinese cities, migrants with rural hukou, compared to residents with local urban hukou, face more uncertainty, have limited access to mortgage finance, and are less eligible for low-cost housing. A simple model demonstrates that for these reasons, rural- to-urban migrants are less likely to own housing units in cities and as a result accumulate less wealth. Our empirical analysis examines a nationally representative household survey from 2013 and uses mother's hukou status as an instrumental variable. We find that household heads with rural hukou are about 20 percentage points less likely to own housing units in cities than comparable household heads with local urban hukou. Consequently, the average household head with a rural hukou owns 310 thousand yuan less housing wealth and 213 thousand yuan less total wealth than comparable household heads with local urban hukou. The average household head with a rural hukou has 286 thousand yuan less in housing capital gains than comparable household heads with local urban hukou. Moreover, we find that these differences are much larger in the first- and second-tier cities, cities with more stringent hukou regulations, and among younger cohorts.
    Keywords: hukou, tenure choice, wealth, Chinese economy
    JEL: R0 R2 H0
    Date: 2020–11
  4. By: Hott, Christian; Tran, Thi Xuyen
    Abstract: Our paper analyses the effect of natural catastrophes on insurance demand in a developing economy and the specific role of insurance regulation in this relationship. We base our analysis on a theoretical model as well as a panel regression using household survey level data for Vietnam and corresponding spatial measures of natural catastrophes. Vietnam is especially interesting for our analysis as it is strongly affected by natural catastrophes and experienced an enhancement of insurance regulation in recent years. The theoretical results indicate that a loss experience should have a less positive effect in developing economies than in developed economies. In addition, an enhancement of insurance regulation should make the impact of a loss event on insurance demand more positive. These findings are confirmed in our empirical analysis: Overall natural catastrophes decrease insurance demand of affected households in Vietnam. The enhancement of insurance regulation not only increased insurance demand. It also reversed the effect of natural catastrophes on the property insurance demand of affected households.
    Keywords: Insurance Penetration,Natural Catastrophes,Insurance Regulation
    JEL: G22 Q54
    Date: 2020
  5. By: Duc Anh Dang; Hai Anh La
    Abstract: The literature shows that political connections have different effects on firms' activities. However, the question of how political connections affect firms' formalization has not been explored. Using data from three waves of the Vietnam Small and Medium Enterprise Survey for the period from 2007 to 2011, this paper aims to examine the relationship between political connections and firms' formalization in Viet Nam. We find that firms with political connections increase their share of formal workers.
    Keywords: Political connections, formalization, Viet Nam
    Date: 2020
  6. By: Vu, Quang; Tran, Tuyen
    Abstract: Using the Färe-Primont index and instrumental variable fixed effect estimation for the data of small and medium-sized enterprises (SMEs), this study considers if receiving government financial support enables SMEs in Vietnam to become more productive. The paper discovers no evidence of linkage between financial support and firm productivity. However, access to financial support improves technological progress and growth in firm scale but has a negative effect on improvement in technical efficiency. The estimation results reveal that the use of productivity as an aggregated index in previous studies may hide the real effect of government support on firm productivity.
    Keywords: Financial support; productivity; small and medium-sized enterprises; Vietnam
    JEL: O3 O31 O33
    Date: 2020–01–15
  7. By: Jung, Benjamin
    Abstract: China's accession to the World Trade Organization (WTO) in 2001 was a massive boostfor the multilateral trading system. We present descriptive evidence on the trade effects of China's WTO accession. Moreover, we combine the most recent approaches from the gravity literature of international trade to provide a causal analysis of the effects of China's WTO accession on bilateral trade with other WTO members. We find that the trade effectis positive on average. Moreover, we document substantial heterogeneity in the trade effects across China's trading partners. These findings seem to be consistent with China's position in global value chains.
    Keywords: GATT/WTO,China,international trade,structual gravity
    JEL: F13 F14
    Date: 2020
  8. By: Mavlikeeva, Maria; Asanov, Igor
    Abstract: Despite evidence of the gender wage gap in favor of men, aggregate findings from correspondence studies show that women are more likely than men to be invited for a job interview (Gornall and Strebulaev, 2018). We hypothesize that the predominance of women among recruiters may explain this somewhat puzzling finding; recruiters may favor applicants of their own gender. We use the data from a large-scale correspondence study in Russia to test this hypothesis. As expected, we find that female applicants are more likely to receive callbacks for interview. We also see that in our sample the majority of contact persons responsible for the recruitment process are female. More importantly, we find that if recruiter and applicant are of the same gender, then the likelihood that the applicant will be invited for an interview increases. These findings taken together point out the gender favoritism at the hiring stage in the labor market.
    JEL: J01 J7 C93
    Date: 2020
  9. By: Ivanović, Vladan; Kufenko, Vadim
    Abstract: The relationship between female empowerment and economic development is one of the most complex examples of reverse causality, yet multiple scholars acknowledge that female empowerment promotes economic progress. One of the crucial aspects of female empowerment is female entrepreneurship; however, the literature on the emergence of female entrepreneurship is scarce. We focus on the rise of female entrepreneurship in Serbia and collect an extensive biographical dataset of women, who took part in privatization. Although women enjoyed the same de jure rights as men, they faced a number of informal restrictions such as i) patriarchal values, limiting the role of women in the society and ii) occupations in low-wage sectors, making it difficult to accumulate capital. Analyzing the determinants of failures of the newly privatized firms during 2002-2019 we find a significant negative relationship between the risks of failure and the cases of own independent entrepreneurial success of women prior to privatization as well as the cases, in which only the entrepreneurial success of husbands of these women was registered. This relationship is robust to controlling for diverse characteristics of firms and to inclusion of ownership duration. We also find that the presence of influential husbands in the background was not significantly related to the subsequent change of ownership. Although the ownership change was registered for the majority of firms in our sample, we find that during the Serbian privatization women managed to build up on their own entrepreneurial success, which contributed to female empowerment. These findings can be relevant for understanding the aftermath of privatizations with respect to gender inequality in other transition countries.
    Keywords: entrepreneurship,female entrepreneurship,economics of gender,political,economy,transition
    JEL: J16 L26 D72 P26
    Date: 2020
  10. By: Gangl, Selina
    Abstract: This paper examines the effect of soda taxes on the consumption behaviour and health of school-aged children in Europe: Hungary imposed a "Public Health Product Tax" on several unhealthy products including sodas in 2011. France introduced solely a tax on sodas, containing sugar or artificial sweeteners, in 2012. In order to exploit spatial variation, I use a semi- parametric difference-in-differences (DID) approach. Since the policies differ in Hungary and France, I analyse the effects separately by using a neighbouring country without a soda tax as control group. The results show a counter-intuitive positive effect of the tax on the soda consumption in Hungary. Reasons for this finding might be a substitution of unhealthy products as well as the decreased amount of sugar in sodas. The effect of the soda tax in France is as expected negative, but insignificant which might be caused by a low tax rate. The body mass index (BMI) is not affected by the tax in any country. Consequently, policy makers should think carefully about the design, aim, and the tax rate, as well as the possible reaction of manufacturers before implementing a soda tax.
    Keywords: Soda tax,consumption,health,semi-parametric difference-in-differences,HBSC
    JEL: H25 I12 I18 L66
    Date: 2020

This nep-tra issue is ©2020 by Maksym Obrizan. It is provided as is without any express or implied warranty. It may be freely redistributed in whole or in part for any purpose. If distributed in part, please include this notice.
General information on the NEP project can be found at For comments please write to the director of NEP, Marco Novarese at <>. Put “NEP” in the subject, otherwise your mail may be rejected.
NEP’s infrastructure is sponsored by the School of Economics and Finance of Massey University in New Zealand.