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on Transition Economics |
| By: | Assaf Razin; Andrzej Cieslik |
| Abstract: | This essay highlights the effects of radical transformations in the liberal characteristics of the regimes on foreign direct investors. To focus on the common patterns in the effects on foreign direct investment, of liberal vs. illiberal regime change, the essay spotlights the tale of two countries: Poland and Israel. The liberalization of the Polish economy and market reforms in the late 1980s and early 1990s boosted Poland's attractiveness to international companies. However, decades-long of illiberal policies under the PiS regime has reduced Poland's appeal to foreign investors. Similarly, Israel's GNP especially the high-tech sector saw significant growth from the 1990s to the 2010s, driven by the liberalization of capital and finance surges, and the global IT boom immigration. As a more-or-less a laboratory experiment for the real-economy impact of an abrupt transition to an illiberal regime, early steps of a comprehensive judicial overhaul have disrupted Israel's growth, causing a sharp decline in foreign direct investment. |
| JEL: | F21 F40 P00 |
| Date: | 2024–06 |
| URL: | https://d.repec.org/n?u=RePEc:nbr:nberwo:32614 |
| By: | Guanie Lim (National Graduate Institute for Policy Studies, Tokyo, Japan); Nhat Anh Nguyen (National Graduate Institute for Policy Studies, Tokyo, Japan) |
| Abstract: | This paper delves into the transformation of East Asia's economic landscape post-World War Two, with a special emphasis on Vietnam's developmental path in the context of regional shifts. It evaluates the effects of the 'doi moi' reforms initiated in 1986, which, despite some successes, have led to limited advancements in fostering sustainable internal capabilities and in establishing a robust export-oriented manufacturing sector. The paper points out a notable trend: leading Vietnamese firms, including state-owned enterprises, predominantly engage in protected, non-tradable sectors such as real estate and finance, rather than in manufacturing. A critical examination reveals that Vietnam's governance structure and industrial policy approach contribute to its mixed economic performance. The absence of a dominant coordinating body or ministry in Vietnam, unlike the models seen in earlier East Asian industrializers, has resulted in ineffective policy execution and a governance model marked by decentralization and inefficiency. The paper concludes with a poignant argument: Vietnam's economic journey only loosely mirrors that of the early East Asian industrializers. The concern of Vietnam falling into a middle-income trap looms large, as its largest firms lack the dynamism to compete internationally. Promises of reform, while welcome, have also not been as forthcoming or consequential as initially expected. The paper calls for a radical overhaul in governance and policymaking to steer Vietnam away from mediocrity and towards a more promising economic future. |
| Keywords: | Development, Industrialization, Industrial Policy, East Asia, Vietnam, Governance, State-Business Relations |
| Date: | 2024–04 |
| URL: | https://d.repec.org/n?u=RePEc:ngi:dpaper:24-01 |
| By: | Martin Guzi; Maciej Duszczyk; Peter Huber; Ulrike Huemer; Marcela Veselková |
| Abstract: | The paper provides an overview of the situation of Ukrainian refugees in the labour markets of Austria, Czechia, Poland, and Slovakia, emphasizing the initiatives aimed at facilitating their integration. Refugees face challenges in securing employment adequate to their skills due to language barriers, limited capacity in childcare services, strict entry conditions for skilled occupations, and uncertainty surrounding their refugee status. The chapter concludes with recommendations for enhancing the labour market integration of refugees. |
| JEL: | E24 F22 J41 |
| Date: | 2024–07–15 |
| URL: | https://d.repec.org/n?u=RePEc:cel:dpaper:68 |
| By: | Jaime Arellano-Bover; Shmuel San |
| Abstract: | We study how job mobility, firms, and firm-ladder climbing can shape immigrants’ labor market success. Our context is the mass migration of former Soviet Union Jews to Israel during the 1990s. Once in Israel, these immigrants faced none of the legal barriers that are typically posed by migration regulations around the world, offering a unique backdrop to study undistorted immigrants’ job mobility and resulting unconstrained assimilation. Rich administrative data allows us to follow immigrants for up to three decades after arrival. Differential sorting across firms and differential pay-setting within firms both explain important shares of the initial immigrant-native wage gap and subsequent convergence dynamics. Moreover, immigrants are more mobile than natives and faster at climbing the firm ladder, even in the long term. As such, firm-to-firm mobility is a key driver of these immigrants’ long-run prosperity. Lastly, we quantify a previously undocumented job utility gap when accounting for non-wage amenities, which exacerbates immigrant-native disparities based on pay alone. |
| Keywords: | immigration, firms, job mobility, labor market assimilation |
| JEL: | J31 J61 F22 |
| Date: | 2024 |
| URL: | https://d.repec.org/n?u=RePEc:ces:ceswps:_11177 |
| By: | Ferdinand Pot; Janez Šušteršič |
| Abstract: | This paper studies the differences between the organisation of budget management in selected government administrations in the Western Balkans and the Republic of Moldova and good practice across the European Union (EU). It observes that the ministry of finance (MoF) in these administrations typically engages in direct budget negotiations with a large number of budget organisations. This practice is in stark contrast with the budgeting approach observed in the EU, where the MoF only deals directly with government ministries and a limited number of constitutional bodies. The paper highlights the adverse consequences for the strategic role of the MoF for fiscal policy, the accountability of line ministries for budgeting and service delivery in their sector and the introduction of modern public financial management instruments such as medium-term budgeting and performance-based budgeting. This paper recommends that governments reduce the number of first-level budget organisations and give line ministries more responsibility for budget management in their sector. At the same time, the paper recommends strengthening line ministries’ accountability for budget management towards the parliament. |
| Keywords: | administrative budget classification, budget management, budget reform, first-level budget organisations, government and budgeting, medium-term budgeting, ministerial accountability, ministry of finance, performance-based budgeting |
| Date: | 2024–07–11 |
| URL: | https://d.repec.org/n?u=RePEc:oec:govaac:72-en |
| By: | Aya Suzuki (University of Tokyo); Susan Olivia (University of Waikato); Vu Hoang Nam (Faculty of International Economics, Foreign Trade University); Guenwoo Lee (Japan International Research Center for Agricultural Sciences) |
| Abstract: | Disease outbreak is a major issue in aquaculture sector that may lead to a significant economic loss. While the source of disease is difficult to trace, understanding how it occurs is important in mitigating the problem. One important factor that has not received sufficient attention is the presence of spillover among fish farmers who are connected by waterways. In this paper, we examine the presence of spillover among shrimp farmers in Southern Vietnam based on the primary data. In particular, we quantify the effects of water pollution spillover of disease outbreak in one farm to another farm and the peer effects of farming practices among the neighbors. We solve the reflection problem posed by Manski (1993) by employing a method developed by Bramoullé et al. (2009) in social network analyses. Our findings indicate that neighbors' farming practices indeed positively affect a farmer's practices and the disease outbreak in neighbors' ponds affects the disease outbreak in a farmer's pond, even after controlling for contextual peer effects and correlated effects. The magnitude of negative effects from neighbors' ponds on disease outbreak may offset the positive effects from farmers' good farming practices, suggesting the importance of considering neighboring farmers as a group in addressing the issue of disease control. |
| Keywords: | peer effect; shrimp farming; Vietnam |
| JEL: | O12 Q10 Q56 D62 |
| Date: | 2024–07–09 |
| URL: | https://d.repec.org/n?u=RePEc:wai:econwp:24/04 |
| By: | Miklós Koren; Álmos Telegdy |
| Abstract: | Using a novel Hungarian dataset on firms and their Chief Executive Officers (CEOs), we estimate the impact of hiring expatriate CEOs. By examining foreign acquisitions where the new owner replaces the incumbent CEO with an expatriate or a local CEO, we address the selection into both acquisition and CEO hiring. Firms led by expatriate CEOs show 13 percent total factor productivity growth, 95 percent sales growth, and increase both exports and domestic sales. Hiring expatriate CEOs enhances firm performance in both international and domestic markets. Our findings suggest that expatriates have superior general management skills. |
| Keywords: | expatriate CEO, foreign acquisition, firm performance, Hungary |
| JEL: | F23 F61 L25 |
| Date: | 2024 |
| URL: | https://d.repec.org/n?u=RePEc:ces:ceswps:_11164 |
| By: | Aleksandra Parteka (Gdansk University of Technology, Gdansk, Poland); Piotr PÅ‚atkowski (Gdansk University of Technology, Gdansk, Poland); Sabina Szymczak (Gdansk University of Technology, Gdansk, Poland); Joanna Wolszczak-Derlacz (Gdansk University of Technology, Gdansk, Poland) |
| Abstract: | This paper describes the construction of a microlevel database on knowledge creation by higher education institutions (KC-HEI), accompanying the Global Knowledge Input-Output database (KIO, Davies et al., 2023). The database was created as part of Project Rethink GCS. KC-HEI links PATSTAT information on the patenting activity of 866 universities (HEIs) in 31 European countries over four decades (1980-2019), using citation records and patent quality indicators from OECD/STI Micro-data. KC-HEI makes possible analysis of the Institutions' innovation performance across 128 internationally comparable technological sectors and, separately, with respect to Artificial Intelligence (AI). We also develop a unique crosswalk between PATSTAT and ETER that combines KC-HEI with other institution-level datasets (such as ETER and RISIS) and allows us to build a parallel dataset covering 785 patenting and 2101 non-patenting universities in Europe between 2011 and 2019. We illustrate the potential of the KC-HEI database, providing key stylised facts on the role of universities in knowledge creation, while documenting extreme core-periphery patterns of university patenting in Europe and detecting several key university-level factors that reinforce this disparity. |
| Keywords: | Patents, Innovation, Knowledge, Higher Education Institutions, University |
| JEL: | O31 O33 I23 |
| Date: | 2024–06 |
| URL: | https://d.repec.org/n?u=RePEc:gdk:wpaper:73 |