nep-tra New Economics Papers
on Transition Economics
Issue of 2021‒04‒05
nine papers chosen by
Maksym Obrizan
Kyiv School of Economics

  1. Informal employment and wages in Poland By Liwiński, Jacek
  2. Formal and informal European quality assurance initiatives offering a connection between local gastronomy and small-scale farmers By Allison Loconto; Francisco Garrido-Garza
  3. Employment and Labour Market Vulnerabilities during COVID-19. The Case of Romania By CHIVU, LUMINITA; GEORGESCU, GEORGE
  4. An evaluation of IFIs impact on EU countries budget deficits By Capraru, Bogdan; Georgescu, George; Sprincean, Nicu
  5. ‘Luxury beyond morals’: the rise and transformation of the concept in 18th century Russia By Korchmina, Elena; Kiselev, Mikhail
  6. Financialisation and macroeconomic regimes in emerging capitalist economies before and after the Great Recession By Akcay, Ümit; Hein, Eckhard; Jungmann, Benjamin
  8. Forced Migration, Staying Minorities, and New Societies: Evidence from Post-War Czechoslovakia By Jakub Grossmann; Štĕpán Jurajda; Felix Roesel
  9. Carry trade in developing and developed countries : a Granger-causality analysis with the Toda-Yamamo to approach By Bruno Thiago Tomio

  1. By: Liwiński, Jacek
    Abstract: Purpose: This paper tries to identify the wage gap between informal and formal workers and tests for the two-tier structure of the informal labour market in Poland. Design/methodology/approach: I employ the propensity score matching (PSM) technique and use data from the Polish Labour Force Survey (LFS) for the period 2009-2017 to estimate the wage gap between informal and formal workers, both at the means and along the wage distribution. I use two definitions of informal employment: a) employment without a written agreement and b) employment while officially registered as unemployed at a labour office. In order to reduce the bias resulting from the non-random selection of individuals into informal employment, I use a rich set of control variables representing several individual characteristics. Findings: After controlling for observed heterogeneity, I find that on average informal workers earn less than formal workers, both in terms of monthly earnings and hourly wage. This result is not sensitive to the definition of informal employment used and is stable over the analysed time period (2009-2017). However, the wage penalty to informal employment is substantially higher for individuals at the bottom of the wage distribution, which supports the hypothesis of the two-tier structure of the informal labour market in Poland. Originality/value: The main contribution of this study is that it identifies the two-tier structure of the informal labour market in Poland: informal workers in the first quartile of the wage distribution and those above the first quartile appear to be in two partially different segments of the labour market.
    Keywords: informal workers,undeclared employment,wages,wage penalty,PSM
    JEL: J24 J31 J46
    Date: 2021
  2. By: Allison Loconto (LISIS - Laboratoire Interdisciplinaire Sciences, Innovations, Sociétés - CNRS - Centre National de la Recherche Scientifique - INRAE - Institut National de Recherche pour l’Agriculture, l’Alimentation et l’Environnement - Université Gustave Eiffel); Francisco Garrido-Garza (LISIS - Laboratoire Interdisciplinaire Sciences, Innovations, Sociétés - CNRS - Centre National de la Recherche Scientifique - INRAE - Institut National de Recherche pour l’Agriculture, l’Alimentation et l’Environnement - Université Gustave Eiffel)
    Abstract: Recent consumer research demonstrates that trust-worthiness of food chain actors and the openness of food manufacturers are strongly related to consumer confidence in food (Macready et al., 2020). Thus, the assumption of SFSC promoters is that this greater transparency translates into greater consumer confidence in producers and as a result more social, equitable and fairer trading practices between producers and consumers. Quality assurance and certification are the most common means used to communicate transparency and openness in both conventional and sustainable supply chains (UN environment, 2017). Prior research demonstrates that there are a variety of ways in which assurance and certification can be organized in order to credibly guarantee quality (Loconto, 2017a). Within this context, the Hungarian Ministry of Agriculture has commissioned AGRI KULTI to develop an information and quality assurance system, that identifies management patterns across the connection of local production and gastronomy, both in Hungary and in the European Union (Food Track project). For this reason, a comprehensive and comparative data analysis is required. Thus, this study consisted of exploring and analysing initiatives, businesses or organizations in the EU that can be classified as SFSCs and that communicate their sustainability quality attributions (e.g., organic, local, healthy, agro-ecological, traditional, etc.) through a variety of forms of certification.The aim of this study is to improve our understanding of how to reconnect cities and rural areas by establishing transparent and close links between local (and small-scale) producers with urban gastronomy. In order to achieve this aim, the following objectives were established: 1. Conduct a baseline study of quality assurance and information systems used across Europe in short circuit food chains using internet resources and an online survey when feasible 2. Elaborate 10 in-depth case studies that analyse the types of qualities and forms of quality assurance that have worked in practice.
    Keywords: Short food chain,Certification,Alternative Agrifood Networks,Social innovation and entrepreneurship,Circuit court alimentaire
    Date: 2021–01–25
  3. By: CHIVU, LUMINITA (National Institute of Economic Research - Romanian Academy); GEORGESCU, GEORGE (National Institute of Economic Research - Romanian Academy)
    Abstract: The extremely fragile balance of the Romanian labour market is severely affected by the crisis caused by the COVID-19 pandemic and by the sudden and almost general deterioration of the macroeconomic context and the business environment. The present study aims to argue that, in times of crisis, such as the current one, the labour market policies need to be varied but also synergistic, in order to stimulate employment and capitalize the potential of each category, so as to contribute to the recovery of the country's macroeconomic and financial framework. Despite the Government's anti-crisis and economic support measures, in the short term, the Romanian labour market is facing the unemployment rate increase, at least in 2020, as a result of the restrictions in many activities, exacerbating the vulnerabilities of the employed population structure described in the study. The analyses carried out revealed that, in Romania, the crisis affected practically all the members of society, but in a disproportionate manner, the most exposed being the vulnerable groups, namely people in the "grey" or informal area of the economy, those working in the most affected sectors and workers with low qualification, many deprived of the needed protection and social assistance. In the context of efforts to identify ways to reduce the distortions generated by the crisis, the integration of social security systems with social assistance can be a viable solution. As activities resume, the labour market tensions are expected to be mitigated both by labour market-specific measures, including those presented in the study, and at the macroeconomic level, adapted to the post-COVID-19 restructuring of the economy, with the necessary policy support at central and local level, including in terms of employment
    Keywords: labour market, COVID-19 pandemic, employment, vulnerable groups, protection and social assistance, macroeconomic risks
    JEL: E24 F66 J10 J21 J46 O15
    Date: 2021–03
  4. By: Capraru, Bogdan (Romania Fiscal Council); Georgescu, George (Romania Fiscal Council); Sprincean, Nicu (Romania Fiscal Council)
    Abstract: This paper explores the impact of the independent fiscal institutions on public budget deficit in the European Union. We employ a dynamic panel model for the period 2000-2019 and find that these fiscal watchdogs have a positive and significant influence on general government balance for European Union Member States, resulting in smaller public budget deficits. The findings maintain their significance regardless of the year of accession to the European Union (old vs. new members) or euro area status (euro area vs. non-euro area members). However, we find that the independent fiscal institutions play a much important role for countries that established their fiscal institutions before 2013. Moreover, we document that during systemic and banking crises these independent fiscal councils can help reducing public budget deficits. Our results are robust to a variety of specifications and models, including alternative definitions of government balance and after controlling for a set of institutional characteristics.
    Keywords: : Fiscal Balance; Independent Fiscal Institutions; Public Budget Deficit
    JEL: E62 H60
    Date: 2020–11
  5. By: Korchmina, Elena; Kiselev, Mikhail
    Abstract: Luxury has always been an intrinsic part of world history, but the words ‘luxe’/’luxury’ in the conventional sense are quite new, entering the French and English languages only in the 17th century. It was only at the end of the 17th century that the core of this phenomenon came up for discussion in Europe against a backdrop of development of international trade and incipient economic growth. During these debates, the concept of luxury was gradually demoralized by economic liberalism. A seminal role in the defining of the concept of luxury was played by translations. European thinkers coordinated their positions even if they disagreed with each other. How was the notion of luxury conceptualized outside the European Roman world? Russia is an interesting example that helps to understand it. The article answers when and why the concept of luxury entered Russian political thought and why although the luxury, finding itself outside the bounds of morality, continued to be only condemned in the economic sphere.
    Date: 2021–03–26
  6. By: Akcay, Ümit; Hein, Eckhard; Jungmann, Benjamin
    Abstract: In recent years, diverging demand and growth regimes have received greater scholarly attention. In particular, the intersection between different variants of Comparative Political Economy and the post-Keynesian macroeconomic analysis provides a promising avenue for understanding the main dynamics of various growth regimes. Yet, the majority of these studies has focused on the global North. In this contribution, we expand this analysis to the global South by examining eight large emerging capitalist economies (ECEs) - Argentina, Brazil, China, India, Mexico, Russia, South Africa, and Turkey - during the periods 2000-2008 and 2009-2019. In so doing, we not only uncover the main demand and growth regimes of ECEs for the two periods, but also link these results to the main trends in the demand and growth regimes of developed capitalist economies (DCEs) for both periods. One of the main findings of our research is that ECEs did not follow the same path as DCEs after the Great Recession. While there was a clear shift in the demand and growth regimes of DCEs towards an export orientation, the main pattern in the ECEs remained the continuation of a trend that had already emerged before the 2007-09 crisis, i.e. domestic demand-led models. Finally, we provide some observations on the puzzle of resilient domestic demand-led models in ECEs.
    Keywords: demand and growth regime,financialisation,emerging capitalist countries,post-Keynesian economics,Argentina,Brazil,China,India,Mexico,Russia,South Africa,Turkey
    JEL: E11 E12 E65 F65
    Date: 2021
  7. By: Jaan Masso; Amaresh K Tiwari
    Abstract: In this paper, using Estonian Community Innovation Survey data, we study the role of R&D, capital accumulation, and innovation output on productivity for entrants and incumbents. We find that the impact of R&D investment on labour productivity is larger for the entrants com- pared to the incumbents. Entrants are found to be more productive and more heterogeneous in their total factor productivity (TFP) than the incumbents. Moreover, entrants who innovate are on average, in terms of TFP, 25% more productive than the entrants who do not, while the corresponding figure for the incumbents is 7%. In addition, it is mostly the incumbents who benefit from within-industry knowledge that is produced outside their own firm. Finally, for both entrants and incumbents, embodied technological change through capital accumulation is found to be more effective in generating productivity growth than R&D expenditure.
    Keywords: R&D, Innovation, Productivity, Entrants, Incumbents, Spillovers
    Date: 2021
  8. By: Jakub Grossmann; Štĕpán Jurajda; Felix Roesel
    Abstract: How do staying minorities that evade ethnic cleansing integrate into re-settled communities? After World War Two, three million ethnic Germans were expelled from Czechoslovakia’s Sudetenland, but some were allowed to stay, many of them left-leaning anti-fascists. We study quasi-experimental local variation in the number of anti-fascist Germans staying in post-war Czechoslovakia and find a long-lasting footprint: Communist party support, party cell frequencies, far-left values, and social policies are stronger today where anti-fascist Germans stayed in larger numbers. Our findings also suggest that political identity supplanted German ethnic identity among stayers who faced new local ethnic majorities.
    Keywords: forced migration, displacement, ethnic cleansing, stayers, minorities, identity, integration, Communist party, Czechoslovakia, Sudetenland
    JEL: J15 F22 D72 D74 N34
    Date: 2021
  9. By: Bruno Thiago Tomio (CREG - Centre de recherche en économie de Grenoble - UGA - Université Grenoble Alpes)
    Abstract: This paper explores empirically the relationship among speculative financial futures (carry trade), nominal exchange rates, and interest rates differentials in developing and developed countries, during the periods of quantitative easing, tapering and quantitative tightening based on the changes of policy interest rates in the United States (US). The public data supplied by the US Commodity Futures Trading Commission Large Trader Reporting Data is taken as a proxy for foreign exchange carry trade. With a time-series model for each country, we estimate the Granger causality using Vector Autoregressive (VAR) models as proposed by Toda and Yamamoto (1995). We investigate three developing countries (Brazil, Mexico, and Russia) and seven developed countries (Australia, Canada, Euro area countries, Japan, New Zealand, Switzerland, and the United Kingdom). Our findings give support to a better understanding of the relationship between foreign exchange activity and monetary policy.
    Keywords: carry trade,foreign exchange market,interest rate differentials,Toda–Yamamoto causality
    Date: 2019–10–24

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