nep-tra New Economics Papers
on Transition Economics
Issue of 2020‒12‒21
nine papers chosen by
Maksym Obrizan
Kyiv School of Economics

  1. Ethnicity and gender influence the decision making in a multinational state: The case of Russia By Tatiana Kozitsina; Anna Mikhaylova; Anna Komkova; Anastasia Peshkovskaya; Anna Sedush; Olga Menshikova; Mikhail Myagkov; Ivan Menshikov
  2. The Neoliberal Globalization Link to the Belt and Road Initiative: The State and State-Owned-Enterprises in China [alternative title: Bilateral and Multilateral Dualities of the Chinese State in the Construction of the Belt and Road Initiative] By Bayari, Celal
  3. Pandemics, Global Supply Chains, and Local Labor Demand: Evidence from 100 Million Posted Jobs in China By Hanming Fang; Chunmian Ge; Hanwei Huang; Hongbin Li
  4. China and COVID-19: a shock to its economy, a metaphor for its development By Magnus, George
  5. The Response of the Chinese Economy to the U.S.-China Trade War: 2018–2019 By Chang, Pao-Li; Yao, Kefang; Zheng, Fan
  6. The Role of Central and Eastern Europe in Global Value Chains: Evidence from Occupation-Level Employment Data By Gábor Márk Pellényi
  7. Impact of Alternative Funding Instruments to Improve Access to Finance in SMEs: Evidence from Vietnam By Jayasooriya, Sujith
  8. “Does Regional Growth Affect Public Attitudes Towards the European Union?” By Enrique López-Bazo
  9. Protecting the environment for the sake of sustainable development from the perspective of implementing social responsibilities of Vietnamese enterprises By Duong, Van Anh Thi; Pushkareva, Lyudmila

  1. By: Tatiana Kozitsina (Babkina); Anna Mikhaylova; Anna Komkova; Anastasia Peshkovskaya; Anna Sedush; Olga Menshikova; Mikhail Myagkov; Ivan Menshikov
    Abstract: Individuals' behavior in economic decisions depends on such factors as ethnicity, gender, social environment, personal traits. However, the distinctive features of decision making have not been studied properly so far between indigenous populations from different ethnicities in a modern and multinational state like the Russian Federation. Addressing this issue, we conducted a series of experiments between the Russians in Moscow (the capital of Russia) and the Yakuts in Yakutsk (the capital of Russian region with the mostly non-Russian residents). We investigated the effect of socialization on participants' strategies in the Prisoner's Dilemma game, Ultimatum game, and Trust game. At the baseline stage, before socialization, the rates of cooperation, egalitarianism, and trust for the Yakuts are higher than for the Russians in groups composed of unfamiliar people. After socialization, for the Russians all these indicators increase considerably; whereas, for the Yakuts only the rate of cooperation demonstrates a rising trend. The Yakuts are characterized by relatively unchanged indicators regardless of the socialization stage. Furthermore, the Yakutsk females have higher rates of cooperation and trust than the Yakuts males before socialization. After socialization, we observed the alignment in indicators for males and females both for the Russians and for the Yakuts. Hence, we concluded that cultural differences can exist inside one country despite the equal economic, politic, and social conditions.
    Date: 2020–12
  2. By: Bayari, Celal
    Abstract: The Chinese state has integrated its economy into the neoliberal globalization of trade and investment without neoliberalizing its own financial markets, and to ensure stability, the state applies strict controls on interest rates, capital movement and the value of RMB. The Chinese state policies have divided the domestic economy into upstream and downstream domains whereby the state extracts rents from the private businesses profits downstream and then pump them upstream to underwrite the SOEs operating as monopolies (domestically), and as strategic traders, and investors (internationally). The state is the largest owner in the economy through holdings of shares in listed companies, direct ownership of enterprises, influence over privatized SOEs, and ownership of the public utility companies. The state has thus structured the domestic market in a way that has made the appearance of the BRI a cogent outcome. The BRI is a demand creation project for two distinct zones of the state-owned internationalized businesses, firstly, the Chinese state finance sector and secondly other sectors that primarily include the construction, logistics, and utilities. The Chinese state’s regulatory characteristics makes the financing and construction of the BRI possible, and reverential to the aims of the state. Further, the Chinese state has increased its weight in the Bretton Woods financial institutions, the IMF, and World Bank, while institutionalizing its reach in the formation of the Asian Infrastructure Investment Bank and the co-creation of the New Development Bank. These processes have simultaneously ensured commitments to multilateralism and bilateralism.
    Keywords: Belt and Road Initiative, Chinese economy, Neoliberalism, New Keynesianism, State-Owned-Enterprises
    JEL: E2 E22 E27 F12 F13 F15 F17 F18 F2 F21 F29 F3 F30 F33 F34 F36 F4 F42 F43 F47 F62 F63 F64 F66 G0 G00 K2 K21 K23 O1 O11 O14 O16 O19 O32 P2 P21 P28 P33 P48 P51
    Date: 2020–05–01
  3. By: Hanming Fang; Chunmian Ge; Hanwei Huang; Hongbin Li
    Abstract: This paper studies how the COVID-19 pandemic has affected labor demand using over 100 million posted jobs on one of the largest online platforms in China. Our data reveals that, due to the effects of the pandemic both in China and abroad, the number of newly posted jobs within the first 13 weeks after the Wuhan lockdown on January 23, 2020 was about one third lower than that of the same lunar calendar weeks in 2018 and 2019. Using econometric methods, we show that, via the global supply chain, COVID-19 cases abroad and in particular pandemic-control policies by foreign governments reduced new job creations in China by 11.7%. We also find that Chinese firms most exposed to international trade outperformed other firms at the beginning of the pandemic but underperformed during recovery as the Novel Coronavirus spread throughout the world.
    JEL: F16 J2
    Date: 2020–11
  4. By: Magnus, George
    Abstract: The Chinese government’s draconian actions to control the coronavirus seem to be producing a remarkable economic contraction. As so many are unable to attend or resume work at the moment, the government’s palliative economic measures may gain little traction. Although the demand shock will eventually fade, other longer-term issues will surely endure. The supply shock will be less obvious but more corrosive. The government’s questionable conduct in managing the public health crisis has unveiled significant features about governance in Xi’s China that can be mapped on to China’s development. While this crisis is the biggest challenge Xi has faced, there is little doubt that he will survive it, champion the party’s role in the nation’s rescue, and feel emboldened to continue with his authoritarian governance. Yet it is this that, in the long run, will prove incompatible with China’s economic development ambitions.
    Keywords: coronavirus; Covid-19
    JEL: N0
    Date: 2020–02
  5. By: Chang, Pao-Li (School of Economics, Singapore Management University); Yao, Kefang (School of Economics, Singapore Management University); Zheng, Fan (School of Economics, Singapore Management University)
    Abstract: In this paper, we follow the micro-to-macro approach of Fajgelbaum et al. (2020) and analyze the impacts of the 2018–2019 U.S.-China trade war on the Chinese economy. We use highly disaggregated trade and tariff data with monthly frequency to identify the demand/supply elasticities of Chinese imports/exports, combined with a general equilibrium model for the Chinese economy (that takes into account input-output linkages, and regional heterogeneity in employment and sector specialization) to quantify the partial and general equilibrium effects of the tariff war at the product/sector/region/aggregate levels. This complements the studies that focus on the ex post response of the U.S. economy by Amiti, Redding and Weinstein (2019), Fajgel baum et al. (2020), and Cavallo et al. (2020).
    Keywords: Chinese Economy; Tariff War; Elasticity Estimation; Regional Labor Market Adjustment; Welfare Analysis
    JEL: F13 F14 F16
    Date: 2020–11–18
  6. By: Gábor Márk Pellényi
    Abstract: This paper examines the role of Central Eastern European economies within global value chains. Occupation-level employment data are combined with an input-output model to analyse the types of jobs sustained by exporting industries. Based on its initial comparative advantage of low wages, the region remains specialised in fabrication tasks, which limits the domestic value added content of exports. Functional upgrading – the acquisition of more sophisticated service tasks within firms – could improve value capture, but it progressed slowly between 2011-2018. It could be boosted by raising the supply of high-skilled workers and improving local R&D and innovation capabilities.
    Keywords: value chain, Central Eastern Europe, upgrading, value capture, input-output model, The Role of Central and Eastern Europe in Global Value Chains: Evidence from Occupation-Level Employment Data, Pellényi
    JEL: F16 F23 F66 J24 O11 O14
    Date: 2020–12
  7. By: Jayasooriya, Sujith
    Abstract: Access to finance in the digital era is innovative with the different alternative funding approaches. In emerging markets, digital innovation of the financial sources is not limited to the own capital or borrowing from bank or credit institutions but numerous paths of financing. The purpose of the research is to recognize the alternative and innovative funding tools including borrowed from bank/credit institution, borrowed against interest from other sources, and borrowed from other sources without interest, peer-to-peer (P2P) lending -borrowed from friends and relatives without interest-, and stocks issued. The data was obtained from the survey of 2647 enterprises conducted by the UNU WIDER 2015 in Vietnam. The probit model approach for access to finance is used to analyze the impact of alternative funding tools for enterprises. The results predict the use of alternative funding tools for startup capital and investment financing of the firms separately. The results revealed that sources of start-up capital from founders’ own money, loans from friends and acquaintances, finance/investments from other enterprises, domestic bank loan, and Informal credit association (money lenders, informal bank, pawnshop) are positively and significantly affect the access to finance, while loans from family members, business associations, and international bank loans are not significant. Meanwhile, own funding, bank/credit institution, borrowed against interest from other sources, and borrowed from other sources without interest, borrowed from friends and relatives without interest have significantly affected the access to finance. In a summary, the alternative funding tools are an important source for financing SMEs in Vietnam.
    Keywords: Alternative funding, P2P lending, SMEs, Access to Finance
    JEL: L11 L22 L25 M13
    Date: 2020–11–27
  8. By: Enrique López-Bazo (AQR-IREA, University of Barcelona)
    Abstract: This study analyses the impact of growth (in absolute and relative terms) of the European regions on the attitudes towards the European Union (EU) of their citizens. It does so in a period of socio-economic turbulence caused by the financial and sovereign debt crises, the accession to the Union of countries of Central and Eastern Europe, and the spread of anti-European rhetoric. In a first stage, regional indicators of support for and trust in the EU are calculated from the microdata of several Eurobarometer surveys. They confirm interesting changes in the regional distribution of citizens’ attitudes during the period analysed, which vary between the two indicators. In a second stage, these indicators are merged with data on regional growth to assess the impact of the latter on citizens’ perception of the EU. The results suggest that support for and trust in the EU are more widespread in regions with a dynamic economy. This positive impact of growth remains significant and sizeable after controlling for several economic characteristics of the region. However, the impact of regional growth on attitudes towards the EU is not the same in all regions. The effect of support and trust is more intense in regions with per capita income above the EU average.
    Keywords: Perception of the EU, Regional growth, Economic convergence, EU regions. JEL classification: 018, R11, R58.
    Date: 2020–12
  9. By: Duong, Van Anh Thi; Pushkareva, Lyudmila
    Abstract: Development society brings many benefits to people and also brings many challenges. Those challenges seriously affect sustainable economic development, the life and health of all people in society. At present, issues that the whole society has been facing are: hygiene, food safety, environmental pollution, new epidemics, and exhaust of natural resources as well as warming up of the earth... To limit and solve the aforementioned issues, it needs close cooperation and support from all people and enterprises. Every individual, every organization is a part of society. The development of each individual and each enterprise is also the development of society and vice versa. The rise of society will also have a positive impact on each member of it. Therefore, enterprises need to raise awareness about sustainable development and act responsibly with the community and society. It is necessary and useful not only for enterprises themselves but also for the whole society. In this thesis, the author focuses on addressing the following issues: Carrying out social responsibilities associated with environmental protection in order to sustainably develop of Vietnamese enterprises, thereby finding the causes and proposing solutions to help enterprises fulfill their social responsibilities and protect the green, clean and beautiful environment in accordance with the standards prescribed by the Law on Environment of Vietnam in 2014.
    Keywords: environment; sustainable development; social responsibilities; enterprises.
    JEL: H00
    Date: 2020–05–05

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