Economics of Transition and Institutional Change最新文献

The paper studies the role of economic transition in the evolution of wealth inequality. We build a novel overlapping generations model that features heterogeneous workers and exogenous changes: (i) a structural change shifting employment from manufacturing to services and increasing educational attainment, (ii) TFP growth along the path of macroeconomic convergence and (iii) gains in longevity. Using this model, we quantify the role of structural change in the evolution of wealth inequality in Poland as of 1990. We show that a rise in wealth inequality because of growing longevity is lower in an economy undergoing structural change. Thus, structural change per se lowers wealth inequality, at least initially. We also provide an evaluation of a policy-relevant redistribution instrument.

Since 2005 and especially after the global crisis of 2009, Argentina has reversed some of the economic reforms implemented between 1991 and 2001. Due to restrictions on changing import tariffs, the government at the time turned to the implementation of non-tariff measures, the most important of which was the introduction of non-automatic import licences. Our objective is to analyse the impact of changes in import barriers on consumer welfare from 2002 to 2012, specifically measured by the change in consumer prices. The results suggest that the changes in import barriers led to an increase in the prices of both domestic and imported products. Despite a moderate overall effect, there is heterogeneity across sectors. Changes in non-automatic licences account for most of the impact. The price increase is mainly due to the quality and variety channels of imported goods, with the unit value of imports playing a lesser role. At the household level, all experienced a welfare loss, which increases with the level of per capita expenditure.

We investigate the choice of entry mode between joint ventures (JVs) and wholly owned foreign enterprises (WOFEs) of foreign-invested firms in China. Using firm data from 1998 to 2007, we find that foreign firms are more likely to choose JVs over WOFEs when the state influence measured by the prevalence of state-owned enterprises (SOEs) in the target location is higher. The positive association between the probability of choosing JV and state influence is robust after using the “156 projects” as an instrument for SOE prevalence. Second, foreign firms are more inclined to form a JV with state capital rather than private capital, which provides supporting evidence that the role of local Chinese partners is to manage corporate–government relations. We then examine the performance of foreign-invested firms in China and find that, compared with WOFEs, JVs indeed have higher total factor productivity (TFP) and TFP growth and benefit from higher income and profits.

A transparent and reliable business environment, free from corruption, is essential for agricultural development. However, the impact of corruption control on productive activities remains ambiguous. While corruption can facilitate transactions in an overly regulated environment, its control is also crucial for creating transparency and fostering economic progress. This paper examines how different organizational farm structures respond to corruption control in a long-term dynamic specification. Using a unique dataset of an objective corruption control measure and livestock production at the subnational level in Kazakhstan and Russia, the analysis reveals that the relationship between production growth and corruption control is non-linear and differs across household farms, peasant farmers and agricultural enterprises. We find peasant farms exhibit superior average growth in regions with stronger corruption control than other farm structures in regions with weaker corruption control. Conversely, enterprises report lower production growth in regions with intensified anti-corruption measures in the short run, yet they eventually benefit from stronger corruption control in the long run. Livestock production by small household producers positively correlates with anti-corruption initiatives, but this association wanes over time. This paper unravels the intricate dynamics surrounding corruption control and different business structures, shedding light on the multifaceted nature of their interrelationship.

This research investigates the impact of varying levels of social trust across economies on the development of effective formal institutions that serve to determine public debt. Analysing a sample of 95 economies from 2000 to 2020, our econometric results indicate that social trust is a pivotal determinant of public debt. The effect operates indirectly through the quality of various categories of legal system and property rights indicator. In particular, the results reveal that the relationship between social trust and economic-judicial institutions are complementary to each other. In addition, we also find that countries with higher social trust tend to reduce their primary deficit in the face of higher debt, thereby reducing the likelihood of uncontrollable debt scenarios.

We examine government decision-making by studying Chinese local government financing vehicles (LGFVs), an often-criticized funding and investment channel. We find an inverted U-shaped relationship between LGFV diversification and subsequent local economic growth confirmed by identification using policy and regulatory events. The inverted U-shape is stronger when local economic development or government indebtedness is higher. The degree of diversification reflects career concerns and decision-making biases of local political leaders. Thus, bad economic outcomes follow when local governments venture beyond public services, borrow aggressively and invest in too many businesses. Our findings echo the empirical literature on corporate conglomerates.

China's Province-managing-county (PMC) reform policy aims to mitigate fiscal stress and augment expenditure autonomy for county governments by eradicating the subordinate fiscal relationship between prefectures and counties. The research augments the time-varying difference-in-difference technique, utilizing a longitudinal dataset at the county level to examine the incentive effects of this reform on economic performance and local government policy decision. The empirical investigation divulges that the local fiscal incentives introduced by this reform through alleviating fiscal stress and providing expenditure autonomy significantly impact economic performance and influence local government policy decisions. The outcomes become more noticeable in economically developed regions and those characterized by enhanced institutional quality and reduced migration barriers. Additionally, the reform encourages counties to adopt a more proactive fiscal policy characterized by increased capital expenditure to promote economic performance while reducing expenditures on social security subsidies and administrative costs affirming that economic performance targets of county governments garbles the composition of public expenditure. These results support positing that a flattened hierarchical structure ameliorates delays in fiscal matters and facilitates communication across various levels of government in the context of improved institutional quality and reduced migration barriers however at the expense of reduced public expenditures. The findings additionally signifies that PMC policy reform become more incentivized in the political competition for economic performance.

The global economy, dominated by the consequences of a disastrous health crisis and international tensions, needs policy support to regain its growth dynamic. To regain an inclusive and sustainable growth dynamic, structural policies of governments are needed to allow a reallocation of resources and to stimulate productivity. International cooperation seems to be necessary and the IMF's contribution could play an important role in promoting reforms. Indeed, in IMF-supported programmes, the conditions for developing countries' transition to liberalization and open markets are often common. We address the question of whether periods of International Monetary Fund (IMF) conditionality contribute to the promotion of structural reforms in developing countries. Through the entropy balancing method and alternative identification strategies, we show that IMF conditionality programmes promote structural reforms in developing countries. We show that the effect of IMF conditionality can vary depending on the type of conditionality, the type of reform, the time frame and the initial level of structural reforms and can depend on some structural factors including the business cycle, the quality of fiscal and monetary policy, the level of development and the quality of institutions. Furthermore, we show that IMF conditionality can have spillover effects on trading partners and that IMF conditionality programmes that are met tend to have a greater impact on structural reforms. Finally, the effects of adopting reforms under IMF conditionality depend on domestic partisan politics.

This study attempts to answer the question of how strongly the situation in local and neighbouring labour markets affects the level of wages in the local labour market. To answer it we use the wage curve concept. We estimate the wage curve that includes spatial effects and check the stability of the relationships over time. We concentrate on 380 local labour markets in Poland. The research period covers 2005–2021, and spatial panel models are used. Our estimates confirm the existence of the statistically significant and negative relationship between average wages and the situation in the local labour market in Poland with an estimated elasticity of −0.06. Moreover, we confirm the existence of the spatial wage curve in Poland in the 2005–2021 period. Both direct (local) and indirect (spatial) effects are statistically significant and negative on average in the analysed period. The total effects of unemployment rate wages vary from −0.06 to −0.08 depending on the spatial matrix used. Additionally, our research indicates several macroeconomic and institutional factors which are important in shaping wages. Lastly, we find that the elasticity of wages with respect to the unemployment rate is not stable over time. The relationship between unemployment and average wages has strongly weakened.

It's commonly accepted that policymakers should promote women's inclusion for a more inclusive society. Drawing from the literature on democratic and non-democratic routes of elite turnover, this study analyses the effects of elite turnover on women's political empowerment (WPE) by comparing two main routes: political alternation and internal conflict. We measure WPE by using women's political empowerment index (WPEI) from the varieties of democracy database. Based on a large sample of 128 developing countries over the period 1980–2021, the ordinary least square fixed effect and Driscoll-Kraay fixed effects estimations show that elite turnover has a positive and statistically significant impact on WPE. Similar evidence is found when decomposing the WPEI in its sub-indices notably women's political participation, civil society participation, and women's civil liberties sub-indices. This result is also supported by the view that elite turnover increases education, as well as the institutional environment which therefore enables WPE. These results are robust to alternative estimation techniques including the system generalized method of moments and two-stage least squares (GMM and IV 2SLS). Furthermore, the results remain unchanged when considering the majority of the geographical locations of our sample (it is insignificant for the MENA region) and the role of decentraliszation.