Academic literature has made an effort to demonstrate the positive effects of privatisation reforms on government performance and economic growth. However, there is no sufficient evidence to support the benefits of privatisation in terms of government spending efficiency. This study analyses the correlation between privatisation and government spending efficiency. Our empirical results do not support a positive effect of privatisation on government spending efficiency. These findings are relevant because they suggest that, although privatisation has been usually seen as a tool to balance public finances, it does not mean that government spending efficiency will be higher after privatising State‐owned enterprises.
{"title":"Privatisation and government spending efficiency: An empirical analysis in Europe","authors":"Beatriz Cuadrado‐Ballesteros, Noemí Peña‐Miguel","doi":"10.1111/sjpe.12386","DOIUrl":"https://doi.org/10.1111/sjpe.12386","url":null,"abstract":"Academic literature has made an effort to demonstrate the positive effects of privatisation reforms on government performance and economic growth. However, there is no sufficient evidence to support the benefits of privatisation in terms of government spending efficiency. This study analyses the correlation between privatisation and government spending efficiency. Our empirical results do not support a positive effect of privatisation on government spending efficiency. These findings are relevant because they suggest that, although privatisation has been usually seen as a tool to balance public finances, it does not mean that government spending efficiency will be higher after privatising State‐owned enterprises.","PeriodicalId":47171,"journal":{"name":"Scottish Journal of Political Economy","volume":"1 1","pages":""},"PeriodicalIF":1.1,"publicationDate":"2024-05-18","publicationTypes":"Journal Article","fieldsOfStudy":null,"isOpenAccess":false,"openAccessPdf":"","citationCount":null,"resultStr":null,"platform":"Semanticscholar","paperid":"141060226","PeriodicalName":null,"FirstCategoryId":null,"ListUrlMain":null,"RegionNum":4,"RegionCategory":"经济学","ArticlePicture":[],"TitleCN":null,"AbstractTextCN":null,"PMCID":"","EPubDate":null,"PubModel":null,"JCR":null,"JCRName":null,"Score":null,"Total":0}
We check the role of time‐zone difference on offshoring of service tasks when the skill of labors varies between the partner countries. We frame a model where partner countries are located in non‐overlapping time zones, and the skill level of the partner‐country labors is lower. In our model, service production is divided into two sequential stages, and output is a supermodular function of the skill of labors and time. The problem of the producers is to choose between domestic production and offshoring. Domestic production employs high‐skill labors though the time management is inefficient. On the other hand, offshoring to a non‐overlapping time zone helps to work round the clock and reduce the cost, but the lower expertise of skilled labor lowers the output. In such a framework, we check conditions for beneficial offshoring. The condition derived in our analysis provides combinations of skill and time that can make offshoring beneficial. Results show that offshoring across time zones is beneficial even when the complexity of stages of production vary. However, only the relatively less‐critical task is offshored. We further find that availability of domestic low‐skill labor does not benefit the firm, while foreign low‐skill labor may be beneficially utilized through time‐zone exploitation.
{"title":"Variation in labor skills and offshoring across time zones","authors":"Alaka Shree Prasad, Biswajit Mandal","doi":"10.1111/sjpe.12379","DOIUrl":"https://doi.org/10.1111/sjpe.12379","url":null,"abstract":"We check the role of time‐zone difference on offshoring of service tasks when the skill of labors varies between the partner countries. We frame a model where partner countries are located in non‐overlapping time zones, and the skill level of the partner‐country labors is lower. In our model, service production is divided into two sequential stages, and output is a supermodular function of the skill of labors and time. The problem of the producers is to choose between domestic production and offshoring. Domestic production employs high‐skill labors though the time management is inefficient. On the other hand, offshoring to a non‐overlapping time zone helps to work round the clock and reduce the cost, but the lower expertise of skilled labor lowers the output. In such a framework, we check conditions for beneficial offshoring. The condition derived in our analysis provides combinations of skill and time that can make offshoring beneficial. Results show that offshoring across time zones is beneficial even when the complexity of stages of production vary. However, only the relatively less‐critical task is offshored. We further find that availability of domestic low‐skill labor does not benefit the firm, while foreign low‐skill labor may be beneficially utilized through time‐zone exploitation.","PeriodicalId":47171,"journal":{"name":"Scottish Journal of Political Economy","volume":"4 1","pages":""},"PeriodicalIF":1.1,"publicationDate":"2024-05-13","publicationTypes":"Journal Article","fieldsOfStudy":null,"isOpenAccess":false,"openAccessPdf":"","citationCount":null,"resultStr":null,"platform":"Semanticscholar","paperid":"140929247","PeriodicalName":null,"FirstCategoryId":null,"ListUrlMain":null,"RegionNum":4,"RegionCategory":"经济学","ArticlePicture":[],"TitleCN":null,"AbstractTextCN":null,"PMCID":"","EPubDate":null,"PubModel":null,"JCR":null,"JCRName":null,"Score":null,"Total":0}
Pakistan has struggled for a political system suitable for its postindependence development; however, repeated struggles between democracy and dictatorship have slowed Pakistan's economic growth. I quantified the impact of military dictatorship on Pakistan's economy from 1999 to 2008 using synthetic control methods. I found that while the average annual GDP per capita growth grew during the military dictatorship, it was four times lower than synthetic Pakistan's. I conclude that the military did not help Pakistan with its economic malaise. The increase in military expenditure and the prevalence of terrorism due to the military dictatorship may have hindered Pakistan's economic growth.
巴基斯坦一直在努力寻求一种适合其独立后发展的政治制度；然而，民主与独裁之间的反复斗争减缓了巴基斯坦的经济增长。我使用合成控制方法量化了 1999 年至 2008 年军事独裁对巴基斯坦经济的影响。我发现，虽然军事独裁期间的年人均 GDP 增长率有所增长，但比合成巴基斯坦的年人均 GDP 增长率低四倍。我的结论是，军方并没有帮助巴基斯坦摆脱经济困境。军事独裁导致的军费增加和恐怖主义盛行可能阻碍了巴基斯坦的经济增长。
{"title":"Can the military be a better manager of the economy?","authors":"Mingchao Sun","doi":"10.1111/sjpe.12384","DOIUrl":"https://doi.org/10.1111/sjpe.12384","url":null,"abstract":"Pakistan has struggled for a political system suitable for its postindependence development; however, repeated struggles between democracy and dictatorship have slowed Pakistan's economic growth. I quantified the impact of military dictatorship on Pakistan's economy from 1999 to 2008 using synthetic control methods. I found that while the average annual GDP per capita growth grew during the military dictatorship, it was four times lower than synthetic Pakistan's. I conclude that the military did not help Pakistan with its economic malaise. The increase in military expenditure and the prevalence of terrorism due to the military dictatorship may have hindered Pakistan's economic growth.","PeriodicalId":47171,"journal":{"name":"Scottish Journal of Political Economy","volume":"127 1","pages":""},"PeriodicalIF":1.1,"publicationDate":"2024-05-10","publicationTypes":"Journal Article","fieldsOfStudy":null,"isOpenAccess":false,"openAccessPdf":"","citationCount":null,"resultStr":null,"platform":"Semanticscholar","paperid":"140929327","PeriodicalName":null,"FirstCategoryId":null,"ListUrlMain":null,"RegionNum":4,"RegionCategory":"经济学","ArticlePicture":[],"TitleCN":null,"AbstractTextCN":null,"PMCID":"","EPubDate":null,"PubModel":null,"JCR":null,"JCRName":null,"Score":null,"Total":0}
This paper examines the effect of the national culture of the chief executive officers (CEOs) on their risk‐taking behavior in managing the banks, leading to banks' instability using a sample of 805 CEOs for 517 commercial banks in 33 countries from 2011 to 2017. Our empirical results confirm that bank risk‐taking behavior is negatively associated with the national culture of the CEOs who score high on the individualistic culture dimension. We also find that bank risk is likely to increase under the management of CEOs coming from high power distance countries. These results have largely remained unchanged across different settings.
{"title":"Chief Executive Officer's national culture and bank risk‐taking behavior: International evidence","authors":"Quang Duy Luong, Duc Hong Vo, Chi Minh Ho","doi":"10.1111/sjpe.12378","DOIUrl":"https://doi.org/10.1111/sjpe.12378","url":null,"abstract":"This paper examines the effect of the national culture of the chief executive officers (CEOs) on their risk‐taking behavior in managing the banks, leading to banks' instability using a sample of 805 CEOs for 517 commercial banks in 33 countries from 2011 to 2017. Our empirical results confirm that bank risk‐taking behavior is negatively associated with the national culture of the CEOs who score high on the individualistic culture dimension. We also find that bank risk is likely to increase under the management of CEOs coming from high power distance countries. These results have largely remained unchanged across different settings.","PeriodicalId":47171,"journal":{"name":"Scottish Journal of Political Economy","volume":"79 1","pages":""},"PeriodicalIF":1.1,"publicationDate":"2024-05-07","publicationTypes":"Journal Article","fieldsOfStudy":null,"isOpenAccess":false,"openAccessPdf":"","citationCount":null,"resultStr":null,"platform":"Semanticscholar","paperid":"140929111","PeriodicalName":null,"FirstCategoryId":null,"ListUrlMain":null,"RegionNum":4,"RegionCategory":"经济学","ArticlePicture":[],"TitleCN":null,"AbstractTextCN":null,"PMCID":"","EPubDate":null,"PubModel":null,"JCR":null,"JCRName":null,"Score":null,"Total":0}
This paper analyses the economic confidence indicators' reaction to the environment surrounding the COVID‐19 pandemic. Using Eurostat's monthly data for the economic sentiment in European Union countries, we found that, in the COVID‐19 era, confidence and perceptions about the economy are strongly dominated by factors related to the pandemic, more so by policy measures and the vaccination process than by the direct health impact of the coronavirus. This is found to be prevalent across the multiple dimensions of economic sentiment. Moreover, standard macroeconomic variables seem to play a smaller and more marginal role during this period.
{"title":"Lockdowns, vaccines, and the economy: How economic perceptions were shaped during the COVID‐19 pandemic†","authors":"Vítor Castro, Rodrigo Martins","doi":"10.1111/sjpe.12376","DOIUrl":"https://doi.org/10.1111/sjpe.12376","url":null,"abstract":"This paper analyses the economic confidence indicators' reaction to the environment surrounding the COVID‐19 pandemic. Using Eurostat's monthly data for the economic sentiment in European Union countries, we found that, in the COVID‐19 era, confidence and perceptions about the economy are strongly dominated by factors related to the pandemic, more so by policy measures and the vaccination process than by the direct health impact of the coronavirus. This is found to be prevalent across the multiple dimensions of economic sentiment. Moreover, standard macroeconomic variables seem to play a smaller and more marginal role during this period.","PeriodicalId":47171,"journal":{"name":"Scottish Journal of Political Economy","volume":"85 1","pages":""},"PeriodicalIF":1.1,"publicationDate":"2024-04-26","publicationTypes":"Journal Article","fieldsOfStudy":null,"isOpenAccess":false,"openAccessPdf":"","citationCount":null,"resultStr":null,"platform":"Semanticscholar","paperid":"140801062","PeriodicalName":null,"FirstCategoryId":null,"ListUrlMain":null,"RegionNum":4,"RegionCategory":"经济学","ArticlePicture":[],"TitleCN":null,"AbstractTextCN":null,"PMCID":"","EPubDate":null,"PubModel":null,"JCR":null,"JCRName":null,"Score":null,"Total":0}
We examine the welfare effects of the endogenous decision and release timing of weight placed on the rival's profits under relative performance evaluation with quantity competition and asymmetric marginal costs. We find that when the advantaged firm decides and releases the weight as the leader, it always chooses a negative weight on relative performance evaluation, whereas the disadvantaged firm may choose a positive or negative weight depending on the degree of product substitution. Furthermore, we demonstrate that while all firms prefer to release weights early, this situation does not improve social welfare in several economic environments.
{"title":"The welfare effect of release timing of relative performance evaluation under quantity competition and asymmetric costs","authors":"Jumpei Hamamura, Vinay Ramani","doi":"10.1111/sjpe.12374","DOIUrl":"https://doi.org/10.1111/sjpe.12374","url":null,"abstract":"We examine the welfare effects of the endogenous decision and release timing of weight placed on the rival's profits under relative performance evaluation with quantity competition and asymmetric marginal costs. We find that when the advantaged firm decides and releases the weight as the leader, it always chooses a negative weight on relative performance evaluation, whereas the disadvantaged firm may choose a positive or negative weight depending on the degree of product substitution. Furthermore, we demonstrate that while all firms prefer to release weights early, this situation does not improve social welfare in several economic environments.","PeriodicalId":47171,"journal":{"name":"Scottish Journal of Political Economy","volume":"12 1","pages":""},"PeriodicalIF":1.1,"publicationDate":"2024-04-10","publicationTypes":"Journal Article","fieldsOfStudy":null,"isOpenAccess":false,"openAccessPdf":"","citationCount":null,"resultStr":null,"platform":"Semanticscholar","paperid":"140596065","PeriodicalName":null,"FirstCategoryId":null,"ListUrlMain":null,"RegionNum":4,"RegionCategory":"经济学","ArticlePicture":[],"TitleCN":null,"AbstractTextCN":null,"PMCID":"","EPubDate":null,"PubModel":null,"JCR":null,"JCRName":null,"Score":null,"Total":0}
This paper compares some of the most common ways of financing the provision of publicly provided impure public goods/services in a unified dynamic general equilibrium framework with heterogeneous income groups. The focus is on the effects of user prices on individual incentives and how the latter shape aggregate outcomes and distribution. We show that a market‐like mechanism of user prices not only improves individual incentives and enhances aggregate efficiency, but it is also Pareto improving. However, such a mechanism is not beneficial or simply collapses when social externalities are strong, when the government adopts a mixed system that combines user prices with heavy subsidization of user costs, and when there is a minimum amount of the good that everybody needs.
{"title":"On the provision of excludable public goods: General taxes or user prices?","authors":"George Economides, Apostolis Philippopoulos","doi":"10.1111/sjpe.12373","DOIUrl":"https://doi.org/10.1111/sjpe.12373","url":null,"abstract":"This paper compares some of the most common ways of financing the provision of publicly provided impure public goods/services in a unified dynamic general equilibrium framework with heterogeneous income groups. The focus is on the effects of user prices on individual incentives and how the latter shape aggregate outcomes and distribution. We show that a market‐like mechanism of user prices not only improves individual incentives and enhances aggregate efficiency, but it is also Pareto improving. However, such a mechanism is not beneficial or simply collapses when social externalities are strong, when the government adopts a mixed system that combines user prices with heavy subsidization of user costs, and when there is a minimum amount of the good that everybody needs.","PeriodicalId":47171,"journal":{"name":"Scottish Journal of Political Economy","volume":"33 1","pages":""},"PeriodicalIF":1.1,"publicationDate":"2024-04-05","publicationTypes":"Journal Article","fieldsOfStudy":null,"isOpenAccess":false,"openAccessPdf":"","citationCount":null,"resultStr":null,"platform":"Semanticscholar","paperid":"140595735","PeriodicalName":null,"FirstCategoryId":null,"ListUrlMain":null,"RegionNum":4,"RegionCategory":"经济学","ArticlePicture":[],"TitleCN":null,"AbstractTextCN":null,"PMCID":"","EPubDate":null,"PubModel":null,"JCR":null,"JCRName":null,"Score":null,"Total":0}
Entry in a homogeneous Cournot-oligopoly is excessive if there is business-stealing. These findings assume that production costs reduce profits and welfare equally. If firms pay informational rents due to frictions in the employer–employee relationship, production costs partly reflect transfers, which do not alter welfare directly. We investigate the excessive entry theorem in the presence of rents. We find that informational rents can invalidate the theorem. Rents reduce profits and deter entry into the market equilibrium, while the socially optimal number of firms is not affected directly. The rent effect becomes stronger the lower the number of firms and can overcompensate the business-stealing externality. As an example, we model a hidden action problem in which employees have an informational advantage after signing the contract with the firm. Insufficient entry occurs if entry costs are sufficiently high because they lower the number of firms and raise informational rents.
{"title":"Informational rents and the excessive entry theorem: The case of hidden action*","authors":"Marco de Pinto, Laszlo Goerke, Alberto Palermo","doi":"10.1111/sjpe.12371","DOIUrl":"https://doi.org/10.1111/sjpe.12371","url":null,"abstract":"Entry in a homogeneous Cournot-oligopoly is excessive if there is business-stealing. These findings assume that production costs reduce profits and welfare equally. If firms pay informational rents due to frictions in the employer–employee relationship, production costs partly reflect transfers, which do not alter welfare directly. We investigate the excessive entry theorem in the presence of rents. We find that informational rents can invalidate the theorem. Rents reduce profits and deter entry into the market equilibrium, while the socially optimal number of firms is not affected directly. The rent effect becomes stronger the lower the number of firms and can overcompensate the business-stealing externality. As an example, we model a hidden action problem in which employees have an informational advantage after signing the contract with the firm. Insufficient entry occurs if entry costs are sufficiently high because they lower the number of firms and raise informational rents.","PeriodicalId":47171,"journal":{"name":"Scottish Journal of Political Economy","volume":"37 1","pages":""},"PeriodicalIF":1.1,"publicationDate":"2023-12-25","publicationTypes":"Journal Article","fieldsOfStudy":null,"isOpenAccess":false,"openAccessPdf":"","citationCount":null,"resultStr":null,"platform":"Semanticscholar","paperid":"139057373","PeriodicalName":null,"FirstCategoryId":null,"ListUrlMain":null,"RegionNum":4,"RegionCategory":"经济学","ArticlePicture":[],"TitleCN":null,"AbstractTextCN":null,"PMCID":"","EPubDate":null,"PubModel":null,"JCR":null,"JCRName":null,"Score":null,"Total":0}
This article explores the relationship between temperature and intimate partner violence against women in 34 developing countries. Exploiting the variation in average temperatures across women's residential locations within the 12 months prior to the survey date, we detect the positive association between temperature and women's exposure to intimate partner violence. Specifically, a one standard deviation increase in temperature (equivalent to an increase of 5.94°C) raises the risks of intimate partner violence (physical, emotional, and sexual violence) at both the extensive and intensive margins. These impacts could be attributable to the loss of control (proxied by alcohol use) and worse labor market outcomes. Our heterogeneity analyses further show that women from rural areas, those from poor households, those having low education, and those living with low‐educated partners are particularly vulnerable to the damaging consequences of temperature hikes.
{"title":"Temperature and intimate partner violence","authors":"My Nguyen","doi":"10.1111/sjpe.12365","DOIUrl":"https://doi.org/10.1111/sjpe.12365","url":null,"abstract":"This article explores the relationship between temperature and intimate partner violence against women in 34 developing countries. Exploiting the variation in average temperatures across women's residential locations within the 12 months prior to the survey date, we detect the positive association between temperature and women's exposure to intimate partner violence. Specifically, a one standard deviation increase in temperature (equivalent to an increase of 5.94°C) raises the risks of intimate partner violence (physical, emotional, and sexual violence) at both the extensive and intensive margins. These impacts could be attributable to the loss of control (proxied by alcohol use) and worse labor market outcomes. Our heterogeneity analyses further show that women from rural areas, those from poor households, those having low education, and those living with low‐educated partners are particularly vulnerable to the damaging consequences of temperature hikes.","PeriodicalId":47171,"journal":{"name":"Scottish Journal of Political Economy","volume":"69 1","pages":""},"PeriodicalIF":1.1,"publicationDate":"2023-11-30","publicationTypes":"Journal Article","fieldsOfStudy":null,"isOpenAccess":false,"openAccessPdf":"","citationCount":null,"resultStr":null,"platform":"Semanticscholar","paperid":"139199174","PeriodicalName":null,"FirstCategoryId":null,"ListUrlMain":null,"RegionNum":4,"RegionCategory":"经济学","ArticlePicture":[],"TitleCN":null,"AbstractTextCN":null,"PMCID":"","EPubDate":null,"PubModel":null,"JCR":null,"JCRName":null,"Score":null,"Total":0}
Despite the common Euro Area (EA) requirements, we find notable differences in the quality of fiscal governance among the 19 member states. Moreover, characteristics of the delegation approach, which have been largely ignored in the EA fiscal governance framework, remain important in various member states. Using a two-way fixed effects panel data model for the EA countries during 2006–2018, we find that the delegation approach can be effective to improve the fiscal position. On the other hand, the imposition of centrally mandated common rules-based reforms has not taken into account the national political, social and institutional setting, and this may have also affected their effectiveness to achieve fiscal discipline. Our findings thus suggest a reconsideration of the one-size-fits-all, rules-based approach to fiscal governance in the EA.
{"title":"Forms of fiscal governance in the Euro Area – An update","authors":"Moira Catania, Mark Baimbridge, Ioannis Litsios","doi":"10.1111/sjpe.12370","DOIUrl":"https://doi.org/10.1111/sjpe.12370","url":null,"abstract":"Despite the common Euro Area (EA) requirements, we find notable differences in the quality of fiscal governance among the 19 member states. Moreover, characteristics of the delegation approach, which have been largely ignored in the EA fiscal governance framework, remain important in various member states. Using a two-way fixed effects panel data model for the EA countries during 2006–2018, we find that the delegation approach can be effective to improve the fiscal position. On the other hand, the imposition of centrally mandated common rules-based reforms has not taken into account the national political, social and institutional setting, and this may have also affected their effectiveness to achieve fiscal discipline. Our findings thus suggest a reconsideration of the one-size-fits-all, rules-based approach to fiscal governance in the EA.","PeriodicalId":47171,"journal":{"name":"Scottish Journal of Political Economy","volume":"5 6","pages":""},"PeriodicalIF":1.1,"publicationDate":"2023-11-20","publicationTypes":"Journal Article","fieldsOfStudy":null,"isOpenAccess":false,"openAccessPdf":"","citationCount":null,"resultStr":null,"platform":"Semanticscholar","paperid":"138508753","PeriodicalName":null,"FirstCategoryId":null,"ListUrlMain":null,"RegionNum":4,"RegionCategory":"经济学","ArticlePicture":[],"TitleCN":null,"AbstractTextCN":null,"PMCID":"","EPubDate":null,"PubModel":null,"JCR":null,"JCRName":null,"Score":null,"Total":0}
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