nep-tra New Economics Papers
on Transition Economics
Issue of 2021‒06‒28
nine papers chosen by
Maksym Obrizan
Kyiv School of Economics

  1. Regional convergence in CEE before and after the Global Financial Crisis By Smirnykh, Larisa; Woergoetter, Andreas
  2. Between communism and capitalism: long-term inequality in Poland, 1892–2015 By Bukowski, Pawel; Novokmet, Filip
  3. Social mobility and political regimes: intergenerational mobility in Hungary, 1949-2017 By Bukowski, Pawel; Clark, Gregory; Gáspár, Attila; Peto, Rita
  4. Bombing and the Two Vietnams By Vuong, Vu; Chang, Simon; Palmer, Michael
  5. The gig economy in Poland: evidence based on mobile big data By Ber\k{e}sewicz Maciej; Nikulin Dagmara; Szymkowiak Marcin; Wilak Kamil
  6. Economic Growth with Public and Foreign Investment in Vietnam By Ly Dai Hung
  7. An Ex-Ante Assessment on Poverty and Cash Transfer Benefits in Viet Nam under the Covid-19 Pandemic By Giang, Long Thanh; Kikkawa, Aiko; Nguyen, Cuong Viet
  8. Innovation in Transition countries: the role of training By Antonella Biscione; Chiara Burlina; Raul Caruso; Annunziata de Felice
  9. Efficiency and effectiveness of the COVID-19 government support: Evidence from firm-level data By Lalinsky, Tibor; Pál, Rozália

  1. By: Smirnykh, Larisa (HSE University, Moscow); Woergoetter, Andreas (TU Wien)
    Abstract: In this study we analyze the convergence of GDP per capita from 2000 to 2013 (current prices and euro exchange rates) for eight countries (Czech Republic, Slovakia, Slovenia, Hungary, Poland, Estonia, Latvia and Lithuania) of the European Union (CEE8). Some convergence indicators are also calculated for the CEE8 as a whole. The main purpose of this study is to shed some light on the impact of the Global Financial Crisis (GFC) on regional convergence in advanced emerging countries, like the CEE8. The main result of random effects panel regressions for unconditional beta-convergence is that significant convergence is found for the whole period from 2000-2013, but not for sub-periods on either end of the sample, except for Hungary and Poland. This means that convergence in most CEECs is only significant if the GFC is included in the estimation period. The role of capital regions for the convergence process is an item for future research.
    Date: 2021–05
  2. By: Bukowski, Pawel; Novokmet, Filip
    Abstract: We construct the first consistent series on the long-term distribution of income in Poland by combining tax, household survey and national accounts data. We document a U-shaped evolution of inequalities from the end of the 19th century until today: (i) inequality was high before WWII; (ii) abruptly fell after the introduction of communism in 1947 and stagnated at low levels during the whole communist period; (iii) experienced a sharp rise with the return to capitalism in 1989. We find that official survey-based measures strongly under-estimate the rise in inequality since 1989. Our results highlight the prominent role of capital income in driving the U-shaped evolution of top income shares. The unique inequality history of Poland speaks to the central role of institutions and policies in shaping inequality in the long run.
    Keywords: income inequality; transformation; Poland
    JEL: D31 E01 N34
    Date: 2021–06–02
  3. By: Bukowski, Pawel; Clark, Gregory; Gáspár, Attila; Peto, Rita
    Abstract: This paper measures social mobility rates in Hungary 1949-2017, for upper class and underclass families, using surnames to measure social status. In these years there were two very different social regimes. The first was the Hungarian People’s Republic, 1949-1989, a Communist regime with an avowed aim of favouring the working class. Then the modern liberal democracy, 1989-2020, a free-market economy. We find five surprising things. First, social mobility rates were low for both upper- and lower-class families 1949- 2017, with an underlying intergenerational status correlation of 0.6-0.8. Second, social mobility rates under communism were the same as in the subsequent capitalist regime. Third, the Romani minority throughout both periods showed even lower social mobility rates. Fourth, the descendants of the noble class in Hungary in the eighteenth century were still significantly privileged in 1949 and later. And fifth, while social mobility rates did not change measurably during the transition, the composition of the political elite changed fast and sharply.
    Keywords: social mobility; status inheritance; institutions; transition
    JEL: J62 N34 P36
    Date: 2021–06
  4. By: Vuong, Vu (University of Western Australia); Chang, Simon (University of Western Australia); Palmer, Michael (University of Western Australia)
    Abstract: The Vietnam War occurred when Vietnam was divided into two states with contrasting institutions. North Vietnam was characterized by a command economy under a stable political regime, whereas South Vietnam experienced a market economy and prolonged political instability. This paper uses this context to investigate the heterogeneous effect of childhood bombing exposure on health in adulthood. On average we found negative long-term effects on adult height and body mass index among the South Vietnamese population, while their counterparts in the North were barely affected. We argue that this heterogeneity is most likely attributable to the interplay of institutions and bombing.
    Keywords: bombing, body mass index, institutions, nutrition transition, Vietnam
    JEL: I15 O15 I31 H56 N35 N45
    Date: 2021–06
  5. By: Ber\k{e}sewicz Maciej; Nikulin Dagmara; Szymkowiak Marcin; Wilak Kamil
    Abstract: In this article we address the question of how to measure the size and characteristics of the platform economy. We propose a~different, to sample surveys, approach based on smartphone data, which are passively collected through programmatic systems as part of online marketing. In particular, in our study we focus on two types of services: food delivery (Bolt Courier, Takeaway, Glover, Wolt and transport services (Bolt Driver, Free Now, iTaxi and Uber). Our results show that the platform economy in Poland is growing. In particular, with respect to food delivery and transportation services performed by means of applications, we observed a growing trend between January 2018 and December 2020. Taking into account the demographic structure of apps users, our results confirm findings from past studies: the majority of platform workers are young men but the age structure of app users is different for each of the two categories of services. Another surprising finding is that foreigners do not account for the majority of gig workers in Poland. When the number of platform workers is compared with corresponding working populations, the estimated share of active app users accounts for about 0.5-2% of working populations in 9 largest Polish cities.
    Date: 2021–06
  6. By: Ly Dai Hung (Vietnam Institute of Economics, Hanoi, Vietnam)
    Abstract: We analyze the economic growth under impact of public and foreign investment by a vector autogressive model (VAR) on a quarterly sample of Vietnam economy over 2008-2020. The method stresses the role of exchange rate and liquidity supply on context of open economy. The evidence records that there exists a synergy of public and foreign investment on raising economic growth, reducing inflation and evaluating domestic currency. Moreover, the public investment is crucial to combat economic recession, especially during the current pandemic Covid-19.
    Keywords: Economic Growth,Public Investment,Foreign Investment,Vector Autoregression (VAR) model
    Date: 2021–05
  7. By: Giang, Long Thanh; Kikkawa, Aiko; Nguyen, Cuong Viet
    Abstract: Using household data from the Vietnam Household Living Standard Survey (VHLSS) and the sector-specific growth and remittance inflow projections by Asian Development Bank (ADB), this study first estimated the COVID-19 pandemic on income and poverty status of the Vietnamese households, and then simulated the impact of cash transfer programs by the government of Vietnam on the income and poverty status of households. Our simulations suggest that COVID-19 leads to substantial reduction in household's per-capita income, and results in additional 1.7 million poor people. The cash transfers would be pro-poor and helps bring about 1.2 million people out of poverty. The transfers would be particularly pro-poor for ethnic minority and rural persons and those working in severely affected economic sectors. Based on the findings, we discussed various policies to implement appropriate measures to help households cope with adverse economic impact of COVID-19.
    Keywords: COVID-19,poverty,income,microsimulation,Vietnam
    Date: 2021
  8. By: Antonella Biscione (CESPIC, Catholic University Our Lady of Good Counsel); Chiara Burlina (Gran Sasso Science Institute (GSSI)); Raul Caruso (Department of Economic Policy and CSEA, Università Cattolica del Sacro Cuore, CESPIC Catholic University “Our Lady of Good Counsel”); Annunziata de Felice (Department of Law, University of Bari Aldo Moro)
    Abstract: This paper analyses the effect of different training programs on the firms’ innovation activities of 27 transition economies. Despite the ongoing debate on training and its effects on innovation, there are no previous studies investigating the role of different typologies of training. The results of the cross-country analysis show a positive relation between definite training and propensity to innovate, controlling several firms’ characteristics such as size, presence of females in the board, personnel’s education and managers’ past experience. We also find a positive effect when considering other definitions of training (problem solving, commercial, managerial, or on-the-job vs. in-class), thus suggesting the need for policy makers and practitioners to invest in ad-hoc training programs to foster innovation in transition economies.
    Keywords: Transition Economies; Innovation; Training
    JEL: O14 O32 P27 P36
    Date: 2021–04
  9. By: Lalinsky, Tibor; Pál, Rozália
    Abstract: We utilize several unique firm-level datasets in order to assess the efficiency and effectiveness of the government support aiming to curb the economic consequences of the coronavirus (COVID19) pandemic. The results, drawing on the experience of a small open European country (Slovakia), suggest the distributed COVID-19 subsidies save non-negligible number of jobs and sustain economic activity during the first wave of the pandemic. General distribution rules designed on the fly may bring close to optimal results, as relatively more productive, privately owned, foreign-demand oriented firms are prioritized and firms with a higher environmental footprint or zombie firms record a relatively lower chance of obtaining government funding. By assuming constant cost elasticities to sales, we show that the pandemic deteriorates strongly firm profits and increases significantly the share of illiquid and insolvent firms. Government wage subsidies somewhat mitigate firm losses and have statistically significant effect, but relatively mild compared to the size of the economic shock. Our estimates also confirm that larger firms, receiving smaller relative size of the support, have more space to cover their additional liquidity needs by increasing trade liabilities or liabilities to affiliated entities, while SMEs face higher risk of insolvencies.
    Keywords: coronavirus,COVID-19,firm-level,policy measures,wage subsidies,profit,liquidity,solvency
    JEL: D22 H20 G32 G33 J38
    Date: 2021

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