Economics of Transition and Institutional Change最新文献

This paper studies the relationship between firms' excess capacity and their environmental behaviour by matching the environmental data of China's major iron and steel firms with the Chinese Industrial Enterprises database. The findings are as follows. (1) A firm's excess capacity leads to myopic decisions, and firms will pay more attention to short-run economic benefits at the cost of long-run environmental benefits, which strengthens their dependence on the polluting path. (2) The dependence is positively correlated with the transformation barriers, and either a higher innovation cost or a higher possibility of regulatory capture in local official governance would lead to greater dependence on the pollution path. (3) Mergers & acquisitions (M&As) may hopefully cut such dependency, but only cross-provincial M&As led by central state-owned enterprises (SOEs) can effectively alleviate the “pollution effect” of excess capacity, while intra-provincial M&As led by local SOEs fail to achieve such a goal.

Does income inequality worsen a country's health outcomes? In this study, we examine the effect of income inequality and redistribution on health outcomes using a panel dataset for a global sample of 154 countries from 1990 to 2020, and the instrumental variable method. The evidence from the empirical analyses revealed that, on average, higher income inequality is associated with poor health outcomes. On the other hand, this study documented that, on average, countries with higher income redistribution have better health outcomes. From regional analyses, we documented that income inequality strongly worsens health outcomes in South Asia, the Middle East and North Africa, sub-Saharan Africa and the Caribbean and Latin America. We found that education, environmental pollution, health expenditure and GDP per capita are the potential channels through which income inequality affects health outcomes. The findings established in this study suggest that a political environment that supports better income distribution would lead to better health outcomes.

We develop a methodology for measuring the scale of the unregistered wages paid to staff by employers. We show that the differences in earnings distribution between public- and private-sector employees are not reflected in the distribution of expenditure. Assuming that public-sector employees do not receive unreported income, this points to undisclosed income in the private sector. After showing that the distribution of income from non-wage sources does not systematically depend on the sector, we argue that the differences may be attributed to envelope wages. We estimate that 10%–11% of employees in Poland receive envelope wages, which account for around 5% of total earnings.

In emerging countries, deposits play an important role in banks' total funding; hence, depositor discipline may significantly impact banking performance and financial system stability. This paper investigates depositor discipline before and after Vietnam's 2008–2011 banking crisis when depositors had little experience regarding bank bailouts and the amount of deposit insurance was limited to a low cap. The study points out that before the crisis, the level of deposit financing in banks depended on both the interest rates offered and on measures of banks' risk-taking. After the crisis, given that the Vietnamese government prevented all bank failures to ensure economic, political, and social stability, depositors still react to interest rate changes, but substantially less to risk. This suggests that they have learned that their deposits are safe regardless of the risk the bank is taking.

Parental investments in children's cognitive and noncognitive outcomes are deeply important to policymakers. However, because parental investments are arguably endogenous, estimating their importance empirically poses a challenge. To address this challenge, this paper exploits a rich and novel dataset, the China Family Panel Studies, and proposes a culture-specific instrumental variable based on the Chinese zodiac. By comparing the outcomes of children born just before and just after the cutoff for a “lucky” (or ‘unlucky’) zodiac sign, we find that parents' investments have significant effects on offspring's development of both cognitive and noncognitive skills.

Sick pay systems are critical in balancing the economic and health costs of infectious diseases, especially in workplaces, where uncontrolled disease spread can lead to significant economic losses. Surprisingly, most research on sick-pay reforms does not rely on variation in worker exposure to disease when investigating absences from work. This paper studies the effects of exposure to influenza outbreaks on absences from work when a nation-wide policy canceled health-insurance coverage for the first 3 days of illness. We explore geographic variation in the prevalence of infectious diseases, primarily the seasonal flu, to identify corresponding variations in the need for sickness insurance. Estimates based on the Czech Structure of Earnings Survey imply that when sickness insurance was canceled for the first 3 days of an illness, the total hours of work missed were not affected, but employees relied on paid and unpaid leave instead of sick-leave to stay home. The substitution effects are heterogeneous across occupations and socio-demographic characteristics of employees, and suggest that workers did not increase the spread of infectious illness in workplaces due to a lack of insurance coverage for the first 3 days of an illness.

Improving the quality of export products is critical for promoting economic development, including for the achievement of sustainable development goals. The present study has examined the effect of export product quality improvement on inclusivity in developing countries. Inclusivity reflects a concomitant increase in the real per capita income, reduction in within-country income inequality, and poverty reduction. The analysis covers 101 developing countries over the period from 1980 to 2014, and uses primarily the two-step system Generalized Method of Moments estimator. It shows that export product quality improvement results in greater inclusivity, especially in countries that face high levels of economic growth volatility, including large magnitudes of external shocks. Likewise, export product quality improvement leads to greater inclusivity in countries that experience high levels of export product concentration. The analysis sheds light on the positive contribution of export product quality improvement to inclusivity in developing countries.

We examine the nexus between financial inclusion and inflation targeting monetary policy effectiveness in West African Economic and Monetary Union countries by employing a heterogenous panel approach that enables us to delineate the responses to policy innovations related to idiosyncratic country-specific shocks, common shocks, and composite shocks. We find that these shocks significantly affect inflation and financial inclusion but with varying magnitudes, signs, time of responses, and persistence. We further demonstrate that inflation targeting monetary policy is differently associated with the various dimensions and indicators of financial inclusion. Overall financial inclusion shocks temporarily increase inflation; deposit shocks reduce inflation; and credit shocks increase inflation. Central bank policy rate differently responds across time horizon to overall financial inclusion shocks; and it increases due to credit shocks highlighting that the monetary authority responds to credit shocks by implementing contractionary monetary policy. Our results highlight that monetary policy aimed at promoting inclusive financial services and responses of monetary policy to financial inclusion should be specific to the dimensions of financial inclusion.

A recent strand of the literature suggests that economic sophistication is a strong predictor of economic development. Given that this branch of literature is relatively young, the determinants of economic sophistication have not yet been fully explored. This study contributes to this literature by examining the effect of research and development (R&D) investments on economic complexity. By applying a dynamic panel model to a panel of 67 countries, the following results are established: First, the results showed that research and development investments are associated with greater economic complexity. Second, when analyzing R&D by sector, the results highlight the importance of research spending by higher education, business, public sector and private non-profit sector in improving economic complexity. In the same vein, investments in different R&D activities, including basic research, applied research and experimental research, increase economic complexity. In addition, we provided evidence that R&D spending in several fields, including medicine, engineering, natural sciences, social sciences and arts, also increases economic complexity. Third, we further analyze the heterogeneity of the results, highlighting the role of natural resource endowment and income level. However, investments in research and development remain associated with higher levels of economic complexity in resource-poor countries in contrast to resource-rich countries, where they have no effect. Based on these results, policy implications were discussed.

This paper empirically investigates whether zombie firms affect healthy firms' exporting. Using the 1998–2007 Chinese firm-level dataset, we provide strong evidence that zombie firms significantly decrease exports of healthy firms in each city-industry cluster, that is, both whether to export and export values are affected by zombie firms. Specifically, non-stated-owned enterprises (non-SOEs) are more vulnerable to the effect than their SOE counterparts. In addition, we also identify government subsidies, financial resources and total factor productivity as the sources of the effect, and the heterogeneous export performances of different types of firms are due to the variation in these sources.