Prospects for the world economy in the 1980's

Judged by the conventional measures of the growth of output and trade, of inflation and unemployment, the economic performance of the industrial countries has undergone a marked deterioration in recent years. It is now feared that a further deterioration could take place over the next decade leading to ever greater pressures within and between countries. In this Briefing Paper we attempt to measure the changes that have taken place, to identify their timing and the proximate causes. On the basis of recent developments and a historical perspective we try to judge the prospects for the 1980's.     

The nexus between country risk and exchange rate regimes: A global investigation

Using a sample of 110 countries over the period 1984–2013, this paper examines the impacts of country risks on choosing a specific exchange rate regime (first by utilizing the Levy-Yeyati and Sturzenegger de facto classification and then robusting it by the IMF de jure measurement) relative to other regimes via the panel multinomial logit approach. Empirical findings are as follows. First, in the full samples case we provide evidence that government is more likely to implement a flexible regime, but less likely to adopt a fixed regime, under a low level of composite and financial risk. Second, we find that Eurozone countries are more likely to choose a fixed exchange rate regime with a decrease in the level of country risk and favor a flexible regime in response to a shock from an increase of risk, which is opposite to non-Eurozone countries. Third, we note that high-risk countries are more likely to choose a fixed regime with a low level of composite and political risk in the government, but do not adjust the exchange rate regime as a shock absorber when facing economic and financial risks. It is interesting to see that those countries with relatively low risk display almost opposite results versus high-risk economies. Overall, we believe that it is critically important to account for political economy variables in a government’s exchange rate policy decisions, especially for country risks. All results are robust to the panel ordered probit model.     

Assessing the impact of fiscal transparency on FDI inflows

This paper analyzes the role of fiscal transparency as a determinant of foreign direct investment (FDI) attractiveness. It proposes an empirical test based on a panel regression analysis on data from 72 countries in the 2006–2015 time span. The evidence supports the idea that countries characterized by higher levels of budget openness attract more FDI inflows. In more detail, a higher degree of transparency during the phase of budget execution is associated with increases of FDI inflows, even when the sample is restricted to non-OECD countries and low and lower-middle-income countries. The positive effect is robust to several different specifications and is found to be additional to the one of general government transparency. Moreover, we also show that the role played by fiscal transparency in attracting FDI is independent of other close institutional determinants like control of corruption and regulatory quality.     

政府债务对经济增长的影响及作用渠道

基于1960～2010年113个国家的面板数据集,运用系统广义矩动态面板方法和稳健性分析,比较发达国家和发展中国家政府债务经济增长效应的差异,并尝试分析政府债务影响经济增长的渠道。研究结果显示,政府债务对经济增长有非线性影响;发达国家政府债务对经济增长、投资以及全要素生产率均无显著影响;发展中国家对政府债务的直接承受力更弱,但在一个宽松的临界点内,政府债务的增加可以提高投资率。     

基于不同融资体系的国别会计差异研究

笔者由于政治、经济、法律等因素的影响,各国的会计模式呈现出巨大差异。各国的融资体系差异对会计模式选择具有重要影响。以资本市场为导向的融资体系更倾向于会计信息的公允性,而以银行等机构为导向的融资体系则更关注会计利润的平滑性。通过比较两种融资体系的差异,说明这些差异对各国会计模式产生的影响,以探寻融资模式在国别会计及国际会计协调中的重要作用。     

The price of labour and understanding the causes of poverty

This paper provides a review of how questions in labour economics link to the central concerns of development economics in understanding the mechanisms that both create, and perpetuate, poverty in some countries and not others and in some areas within countries. The paper frames this link by asking what determines first the price of labour, then the nature of employment open to labour and finally discusses the links from the price of labour to incomes through the assets owned by the poor. The advent of micro data in developing countries has transformed our knowledge of what needs to be explained. While the price of labour clearly depends on education the links between incomes and education are much weaker than is frequently supposed. The finding from micro data that conditioning on a wide range of observable characteristics of human capital still leaves most of the variation in earnings to be explained suggests the importance of understanding what these other factors might be and how they may interact with human capital. One possibility is that markets are segmented so that individuals with the same skills earn different amounts depending on the sector in which they work. Another possible explanation is that the unobserved characteristics of workers are more important than the observed and that processes of matching and search lead to the outcomes we observe in labour markets. It is argued that these explanations are not mutually exclusive and that different processes may operate across labour markets both within and across countries. The review concludes by outlining outstanding research issues in labour economics where new models and data may well provide insights into explaining the extraordinarily diverse range of outcomes we observe for the price of labour in poor countries.     

The effects of external and internal shocks on total factor productivity

This paper examines structural changes that occur in the total factor productivity (TFP) within countries. It is possible that some episodes of high economic growth or economic decline are associated with permanent productivity shocks; therefore, this research has two objectives. The first one is to estimate the structural changes present in TFP for a sample of 77 countries between 1950 (1960) and 2000. The second one is to identify possible explanations for breaks. Two sources were analyzed: (i) episodes in political and economic history; (ii) changes in international trade – a measure of absorption of technology. The results suggest that about one-third of the TFP time-series present at least one structural break. Downwards breaks are more common, indicating that after a break the TFP has much difficulty to recover. When we investigated factors related with structural change, developed countries presented a break near the first oil shock while the developing countries’ breaks are more spread along the decades. Thus, external strikes seem to be more relevant for developed countries. However, for each country and break date, it was possible to find an event close to the break date endogenously detected. Last, the relevance of international trade, measured by trade share percentage of GDP, seems to be limited to explain abrupt changes in TFP.     

Is there aJ-curve for the economic transition from socialism to capitalism?

It is often assumed that the process of transition from socialism to capitalism involves a dislocation and disorganization of the economy in the early stages of the transition. Thus, it is argued, economic performance will at first worsen and then gradually improve as the new system takes hold. This paper argues that, based on evidence from Czechoslovakia, Hungary, and Poland, there is no evidence for such aJ-curve phenomenon. Using a simple macroeconomic model, we show that, in these three reforming countries, the decline in production can be explained by exogenous shocks to the balance of trade, to investments and to autonomous consumption. This finding also suggests that macroeconomic policy in these countries may be too restrictive to permit a recovery of employment and production.     

Services trade restrictiveness and manufacturing export sophistication

This paper highlights the importance of services trade liberalization. It is well-known that there is a strong relationship between the level of economic development of a country and the quality of its export basket. Since the pioneering work of Hausmann, Hwang, and Rodrik (2007), several studies have attempted to identify the determinants of export sophistication. In this paper, based on the existing literature, we argue that restrictiveness of services sector trade can have a negative impact on the level of export sophistication. Using panel data from 36 countries over the 2005–2014 period, we show that the impact of services sector trade restrictiveness on export sophistication is negative and statistically significant. We find that this negative effect has increased in the post-2007 period. Furthermore, restrictiveness of trade in modern services is relatively more detrimental to manufacturing export sophistication. A series of endogeneity and robustness tests confirm the reliability of our main empirical result. Our analysis suggests that services sector trade liberalization can also be used as a development strategy by developing countries.     

Monetary Targets and the World Economy: A Progress Report

The recent changes in the value of the dollar and the talk of an interest rate ‘war’ demonstrate again that the world finds it difficult to cope with rapid exchange rate movements. In some ways the experience - and the reactions to it - are similar to the events of 1978. As now, the world was in a recession (though on a milder scale) and there were fears that exchange rate problems would obstruct economic recovery. The main difference is that in 1978 it was the strength of the Deutschmark which caused concern whereas this time the problems are associated with the rise in the value of the dollar. In a Briefing Paper in Economic Outlook, February 1978, ‘Monetary Targets and the World Economy’ we suggested that the problem arose from inconsistencies between national monetary policies and exchange rate objectives. In general, countries dislike exchange rate changes - in either direction - and there were problems because countries would not accept the exchange rate consequences of their own or other countries' monetary policies. We estimated the required monetary policies for stable exchange rates and suggested specific national monetary targets for 1978 which would at least move the world economy towards consistent monetary policies. In this Economic Viewpoint we return to those ideas. We consider what happened in 1978 and we also revise the underlying monetary rules. More recent experience suggests that although there has been some progress towards the convergence of monetary policies there will continue to be trend changes in exchange rates. It is also clear that there will be short-term fluctuations around these trends. We believe that greater convergence of monetary policies would be desirable but failing that it is important that countries should avoid abrupt changes in monetary policy. It is also important that countries should become accustomed to exchange rate changes. They should direct monetary policy towards their objectives for inflation and should not be diverted from it by temporary or permanent changes in their exchange rates.     

Secrecy Culture and Audit Opinion: Some International Evidence

We examine whether and how auditors respond to audit risks arising from secrecy culture when making audit opinion decisions. Using a sample of international Big N auditors from 33 countries, we find strong and robust evidence that auditors are more likely to issue modified audit opinions to clients domiciled in countries with a strong secrecy culture. In addition, we find that the association between secrecy culture and auditors' propensity to issue modified audit opinions is less pronounced in countries with strong investor protection than that in countries with weak investor protection.     

Residential investment and recession predictability

We assess the importance of residential investment for the prediction of economic recessions for an unbalanced panel of 12 OECD countries over the period 1960Q1–2014Q4. Our approach is to estimate various probit models with different leading indicators and evaluate their relative prediction accuracies using the area under the receiver operating characteristic curve as our forecasting performance metric. We document that residential investment contains information that is useful for predicting recessions both in-sample and out-of-sample. This result is robust to adding typical leading indicators, such as the term spread, stock prices, consumer confidence surveys and oil prices. It is shown that residential investment is particularly useful for the prediction of recessions for countries with high home-ownership rates. Finally, in a separate exercise for the US, we show that the predictive ability of residential investment is — in a broad sense — robust to employing real-time data.     

Can crude oil drive the co-movement in the international stock market? Evidence from partial wavelet coherence analysis

In this paper, we employ partial- and multiple-wavelet coherence analyses to examine co-movement between international stock markets by considering the influence of crude oil in a time domain perspective. Overall, we find that crude oil is a major factor driving co-movement between international stock markets in the median and long term. However, when considering the oil-importing and oil-exporting countries differently, we still find that crude oil is a driver for interdependence between oil-importing and oil-exporting countries. In contrast, the crude oil has relative lower impact on the co-movement in oil-importing or in oil-exporting countries, which indicates its co-movement is caused by other factors. In addition, Gulf Cooperation Council stock market may lead the stock markets of oil-importing countries in the long term. Our empirical results provide meaningful information for investors and policymakers.     

Worldwide willingness to delegate and country labor quality

The purpose of this article is to examine how country workforce characteristics shape the willingness of managers to delegate authority to subordinates. Using data from worldwide surveys, we tested to what extent country-specific factors, such as workforce competence, motivation, and probity, shape the willingness of managers to grant decisional power to subordinates. The results show that the willingness to delegate across the 47 countries might be explained by a combined effect of workforce competence, motivation, and probity, labeled quality of country labor. It is argued that in countries where managers perceive that the labor quality is lower (lack of competence, motivation, and probity), the managerial willingness to hand over power to subordinates decreases. The findings of this study have both theoretical and practical implications for the managerial practice of firms doing business internationally. These findings will assist companies and managers to better understand why delegation might not work as expected in one country, whereas the same practice is both effective and indicated in other countries.     

国家贫困县存在税收竞争吗？

以国家扶贫县为研究对象，考察贫困地区是否存在税收竞争行为。利用空间自回归模型，采用最大似然估计法（MLE），在不同空间权重下分析国家扶贫县的税收竞争行为。研究发现：第一，国家扶贫县之间同样存在税收竞争行为；第二，同一省份国家扶贫县之间的税收竞争要明显强于不同省份国家扶贫县之间的税收竞争；第三，经济实力相仿的国家扶贫县之间税收竞争更加明显。     

Short-term Covid-19 forecast for latecomers

The number of new Covid-19 cases is still high in several countries, despite vaccination efforts. A number of countries are experiencing new and severe waves of infection. Therefore, the availability of reliable forecasts for the number of cases and deaths in the coming days is of fundamental importance. We propose a simple statistical method for short-term real-time forecasting of the number of Covid-19 cases and fatalities in countries that are latecomers—i.e., countries where cases of the disease started to appear some time after others. In particular, we propose a penalized LASSO regression model with an error correction mechanism to construct a model of a latecomer country in terms of other countries that were at a similar stage of the pandemic some days before. By tracking the number of cases in those countries, we use an adaptive rolling-window scheme to forecast the number of cases and deaths in the latecomer. We apply this methodology to 45 countries and we provide detailed results for four of them: Brazil, Chile, Mexico, and Portugal. We show that the methodology performs very well when compared to alternative methods. These forecasts aim to foster better short-run management of the healthcare system and can be applied not only to countries but also to different regions within a country. Finally, the modeling framework derived in the paper can be applied to other infectious diseases.     

Urban density,law and the duration of real estate leases

This study explores the relationship between a country’s legal system and how its cities develop by examining the considerable variations in commercial real estate lease duration (or term) across both countries and cities. We find that the cross-country variation in lease duration and building construction is related to the content (common versus civil law) and efficiency (integrity and enforceability) of the legal system in the respective countries. First, we find that countries with a common law system and lower levels of corruption tend to have longer leases. Second, we find that in the United States, high-rise Class A office buildings tend to have tenants with longer term leases, suggesting that the advantages associated with being able to write and enforce a long term lease is particularly important for the development of high-rise office buildings. Finally, we find that there are in fact more high-rise office buildings in countries with more efficient legal systems.     

中国武术走向国际的现状分析及对策研究

武术走出国门是我国体育发展的热点,我们如将探索一条全新的武术发展之路,就要对武术国际化发展的现状进行实际调查。研究表明,武术在全球发展不平衡,习武人数不均,协会较少,武术人才匮乏,教学水平不高是当前武术发展的瓶颈,结合现状提出发展武术国际化的若干建议和对策。     

积极推行CALS战略实现装备物流信息标准化

由于信息基础建设薄弱并缺乏标准化规范,目前装备物流各系统信息不能完全互联互通,形成了一些“信息孤岛”.CALS战略是一项受到许多发达国家重视的策略,对促进信息化建设具有重要的指导作用.通过推行CALS战略,以CALS战略为指导,实现装备物流信息标准化将成为我军装备物流领域的必由之路.     

Productivity gaps and capacity utilization in the manufacturing sectors of five OECD-countries, 1963–1982

The purpose of this paper is to apply some novel features in the theory of productivity indexes to the measurement of productivity gaps. It advances the proposition that one reason for the persistence of productivity gaps might be that the methodology of measuring gaps does not separate shifts of the production function due to intercountry efficiency from shifts due to intercountry differences in capacity utilization.In this paper we calculate productivity gaps for four OECD countries relative to the U.S., adjusted for cyclical variations in capacity utilization for the period 1963–1982. The theoretical foundation of our measurement is based on a variable cost function approach with short-run fixity of capital. Without adjusting for differences in capacity utilization within the countries, productivity gaps are a mixture of differences in productivity and in capacity utilization.The refereeing process of this paper was handled through C. Morrison.