The Quality of Institutions and Organizational Form Decisions: Evidence from Within the Firm

In many retail and service sectors, firms have to establish a physical presence in a geographic market to access customers there. In countries where the quality of institutions is low, this can put assets at risk. We use data on the operations of a multinational, multibrand hotel company to show that in environments where local institutions are weaker—as proxied mainly by the World Bank's Checks index—the company eschews direct ownership. Rather than increasing its reliance on franchising, as predicted by some models, the company relies more on another form of organization commonly used in this industry, namely management contracts. We explain these patterns by emphasizing how the quality of the institutional environment affects the cost of using equity‐based organizational forms, per arguments in the current literature, but also the cost of enforcing the terms of franchise contracts.     

Income Distribution in the Third World: Its Estimation Via Proxy Data

A bstract . A two-Stage least squares estimate of the distribution of income in the Third World is derived in this paper using the per capita ownership of cars, infant mortality rates, and the average daily caloric requirement along with the per capita Gross Domestic Product. Previous work by Kitznets 1955 had established a relationship between the distribution of income and GDP/CAP, but with the inclusion of the three additional "proxy" variables, the distribution of income is estimated with a great deal more precision. For example, the R-squared for the estimate of the share of income earned by the poorest 20% of households increases from 0.30 to 0.68 by incorporating the proxy variables.
Using the parameters estimated via two-stage least squares on a set of 23 countries for which the distribution of income Is known, the paper then estimates the distribution of income for a set of 43 countries for which this data is unknown. The results indicate that countries like Singapore and Sri Lanka have relatively even distributions of income for their stage of development, and countries like Brazil, Kenya, Bolivia , and Gautemala have highly skewed distributions of income for their level of GDP/CAP.     

Exchange rate misalignments,capital flows and volatility

This study investigates the effect of three dimensions of exchange rate misalignments—(i) distance (absolute misalignments), (ii) direction (overvaluation or undervaluation), and (iii) degree (small or large misalignments)—on the overall as well as short-cycle exchange rate volatility. Using data from 1988 to 2014, we find that relative PPP-based exchange rate misalignments increase exchange rate volatility. For developed and developing countries, this increase in volatility is driven mainly by large undervalued misalignments of the U.S. dollar. This finding might be linked to interventions targeting the loss in domestic producers’ competitiveness in global markets. Interestingly, in the case of developed countries, we find this adverse effect on exchange rate volatility also for small absolute misalignments; exchange rate movements close to equilibrium may be associated with ambiguity with respect to future movements in developed countries, which can result in higher exchange rate volatility. Further, the results suggest that, when the dollar is highly undervalued, capital flows have a stabilizing effect on exchange rate volatility in developed countries but a destabilizing effect in developing countries. The finding is consistent with investors’ strategy of taking exchange rate overvaluation and undervaluation into account when engaging in cross-border investments.     

对“时间就是金钱,效率就是生命”的再认识

20世纪80年代初,深圳人首先提出了＂时间就是金钱,效率就是生命＂的口号。它以马克思劳动价值论为基础,反映了市场经济的基本规律——价值规律的内容和要求,是一种科学的时效观。而今,重新解读这一个时效观需与时俱进,既要看到它的历史进步性又要看到它的历史局限性。但这一时效观强调的＂时间＂与＂效率＂问题并没有过时,我们须继续紧紧把握好＂时间＂与＂效率＂这2个关键词,按照市场经济运转的客观规律管好时间、用好时间,增强执行力,提高效率。     

Economic systems in developing countries – A macro cluster approach

This study is an attempt to close a gap in the comparative capitalism literature. Studies in that field focus mostly on industrialized countries, discuss economic systems in developing regions separately, and do not provide evidence based on a worldwide sample. We use an established macroeconomic cluster approach to identify economic systems in a worldwide sample of 115 developing and industrialized countries. We use an innovative approach to correct for income-related differences that would otherwise distort the cluster results. The major results are (1) that two broad categories of economic systems exist in developing countries (liberal and coordinated), which mirrors the results for industrialized countries, and (2) that economic systems in developing countries are apparently determined by a mixture of colonial heritage—with the transfer of more liberal institutions in the case of British colonialization—and regional affiliation, which explain differences within continents and between continents.     

From father to son and from father to daughter: educational mobility in Hungary and the Netherlands for the birth cohorts from 1925 to 1955

In this article we are concerned with the comparison of educational mobility in Hungary and the Netherlands. The analysis is based on representative samples of 1981/2 and applies for both father-son and father-daughter educational mobility specified for four age cohorts. Two different theoretical perspectives are adopted—the industrialisation thesis and the reproduction thesis—from which the expectations for the analysis are derived. These expectations are confronted with the empirical data: firstly by means of overall mobility table measures, secondly by means' of the Hope-type log-linear analysis. The analysis shows that—contrary to the expectations from the reproduction thesis—no significant differences in circulation mobility can be detected between the two countries. Most of the differing mobility patterns are to be found in the structural component of mobility. This component can be uniform [linear] or non-uniform: the direction of the very significant differences supports the industrialisation thesis in this respect. The article ends with a discussion of the visualised effects of educational reforms that were introduced in both countries and with some suggestions for the next research steps.     

Career success schemas and their contextual embeddedness: A comparative configurational perspective

We introduce career success schemas as critical for understanding how people in different contexts perceive and understand career success. Using a comparative configurational approach, we show, in a study of 13 countries, that two structural characteristics of career success schemas—complexity and convergence—differ across country contexts and are embedded in specific configurations of institutional factors. Adopting complexity and convergence as primary dimensions, we propose a taxonomy of career success schemas at the country level. Based on this taxonomy, we contribute to the understanding of subjective career success across countries, discuss the importance of schemas for organisational career systems in multinational enterprises, and propose specific guidelines for future comparative careers research.     

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.     

Population Growth and its Implications for Global Security

Between 2015 and 2050 world population is projected to increase by nearly 2.5 billion, rising from 7.3 billion to an estimated 9.8 billion. The vast majority of that projected increase—an estimated 97 percent—will occur in the developing world. Demography is not destiny, but population growth in the developing world is a challenge‐multiplier. In recent decades, notable gains have been made in reducing the incidence of hunger and poverty in the world, but progress has been slow in countries with high fertility rates. The nations with the fastest growing populations tend to rank high on global indices of hunger, poverty, environmental degradation, and fragility; and many of these countries face enormous obstacles to economic development in the form of climate change, regional or ethnic conflict, or water scarcity. Most of these countries also have large numbers of unemployed young people between the ages of 15–24, a demographic factor that can contribute to, or exacerbate, political instability and conflict. Unless fertility rates in these countries fall faster than currently anticipated by demographers, many of these countries face an uncertain future. Lack of progress in improving living conditions in these countries could lead to greater political instability and conflict and increase the growing number of refugees and internally displaced persons in the world.     

Institutional determinants of the effective tax rate in G7 and BRIC countries

This paper studies the relationship between the corporate effective tax rate (ETR) and several institutional factors in the G7 and the BRIC countries (Brazil, Russia, India, and China). We use the panel data methodology with a data sample of 25,878 listed firms in 2010–2018. The results show that all the variables analyzed have an effect on the ETR. Some—such as the statutory tax rate, government effectiveness, regulatory quality, rule of law, and open markets—affect all countries, whereas others, such as corruption control and economic freedom, affect only the BRIC countries, and gross domestic product growth, the deficit, and gross debt only affect the G7 countries.     

Robust political economy correlates of major product and labor market reforms in advanced economies: Evidence from BAMLE for logit models

The political economy literature has put forward a multitude of hypotheses regarding the drivers of structural reforms, but few, if any, empirically robust findings have emerged thus far. To make progress, we draw a parallel with model uncertainty in the growth literature and provide a new version of the Bayesian averaging of maximum likelihood estimates (BAMLE) technique tailored to binary logit models. Relying on a new database of major past labor and product market reforms in advanced countries, we test a large set of variables for robust correlation with reform in each area. We find widespread support for the crisis‐induces‐reform hypothesis, as high unemployment and economic crises are robustly correlated to structural reforms. We also find evidence of reform convergence—that is, countries with tighter regulation are more prone to liberalize. Reforms are more likely when other countries also undertake them and when there is formal pressure to implement them. Other robust correlates are more specific to certain areas—for example, international pressure and political factors are most relevant for product market and job protection reforms, respectively.     

How quickly do forecasters incorporate news? Evidence from cross‐country surveys

Using forecasts from Consensus Economics Inc., we provide evidence on the efficiency of real GDP growth forecasts by testing whether forecast revisions are uncorrelated. As the forecast data used are multi‐dimensional—18 countries, 24 monthly forecasts for the current and the following year and 16 target years—the panel estimation takes into account the complex structure of the variance–covariance matrix due to propagation of shocks across countries and economic linkages among them. Efficiency is rejected for all 18 countries: forecast revisions show a high degree of serial correlation. We then develop a framework for characterizing the nature of the inefficiency in forecasts. For a smaller set of countries, the G‐7, we estimate a VAR model on forecast revisions. The degree of inefficiency, as manifested in the serial correlation of forecast revisions, tends to be smaller in forecasts of the USA than in forecasts for European countries. Our framework also shows that one of the sources of the inefficiency in a country's forecasts is resistance to utilizing foreign news. Thus the quality of forecasts for many of these countries can be significantly improved if forecasters pay more attention to news originating from outside their respective countries. This is particularly the case for Canadian and French forecasts, which would gain by paying greater attention than they do to news from the USA and Germany, respectively. Copyright © 2006 John Wiley & Sons, Ltd.     

Real exchange rate behaviour: evidence from black markets

The behaviour of real exchange rates (relative to the US dollar) is examined using monthly data obtained from the black markets for foreign exchange of eight Asian developing countries. The data span is 31 years. The black market real exchange rates do not show excess volatility during the recent float which is in sharp contrast to the results reported elsewhere. Unit root tests in heterogeneous panels and variance ratio tests confirm their stationarity. Thus, we find support for PPP but not for the ‘survivorship’ bias (Froot and Rogoff, 1995 ). There is little evidence of segmented trends. Issues raised by Rogoff ( 1996 )—of whether PPP would hold across countries with differing growth experience—and Lothian and Taylor ( 1996 )—of whether the degree of relative price volatility may bias results in favour of mean reverting real exchange rates—are addressed. Copyright © 2000 John Wiley & Sons, Ltd.     

Weak and Strong Cross‐Sectional Dependence: A Panel Data Analysis of International Technology Diffusion

This paper provides an econometric examination of technological knowledge spillovers among countries by focusing on the issue of error cross‐sectional dependence, particularly on the different ways—weak and strong—that this dependence may affect model specification and estimation. A preliminary analysis based on estimation of the exponent of cross‐sectional dependence provides a clear result in favor of strong cross‐sectional dependence. This result has relevant implications in terms of econometric modeling and suggests that a factor structure is preferable to a spatial error model. The common correlated effects approach is then used because it remains valid in a variety of situations that are likely to occur, such as the presence of both forms of dependence or the existence of nonstationary factors. According to the estimation results, richer countries benefit more from domestic R&D and geographic spillovers than poorer countries, while smaller countries benefit more from spillovers originating from trade. The results also suggest that when the problem of (possibly many) correlated unobserved factors is addressed the quantity of education no longer has a significant effect. Finally, a comparison of the results with those obtained from a spatial model provides interesting insights into the bias that may arise when we allow only for weak dependence, despite the presence of strong dependence in the data. Copyright © 2016 John Wiley & Sons, Ltd.     

EDITORIAL: The economy,unemployment and industrial relations.

In analysing and criticising current UK economic strategy Brian Towers comments that the present level of mass unemployment is the most serious economic, social and political problem to face the developed countries—and with devastating consequences for the Third World—since the end of the Second World War. Yet a large part of the explanation for the deepening recession lies in the policies of individual states with support from several international economic organisations, notably the IMF.     

The natural resource curse and economic transition

Using cross-country regressions, we examine the relationship between “point-source” resource abundance and economic growth, quality of institutions, investment in human and physical capital, and social welfare (life expectancy and infant mortality) for all countries and for the economies in transition. Contrary to most literature, we find little evidence of a natural resource curse for all countries. Only the “voice and accountability” measure of institutional quality is negatively and significantly affected by oil wealth. In the economies in transition, there is some evidence that natural resource wealth is associated with lower primary school enrollment and life expectancy and higher infant mortality compared to other resource rich countries. Compared to other economies in transition, however, natural resource abundant transitional economies are not significantly worse off with respect to our indicators.     

An assessment of human development,by region and country

The United Nations Development Program has introduced a composite index—the Human Development Index (HDI)—as a measure to replace GDP for assessing development of countries, using life expectancy, adult literacy, and adjusted per capita GDP as indicators. In this paper the authors suggest an alternative method for computing the index utilizing the same criteria.     

PRIMARY EDUCATION AS AN INPUT INTO POST-PRIMARY EDUCATION: A NEGLECTED BENEFIT†

In some developing countries private rates of return to primary education have fallen to low levels. An explanation is provided as to why this fall need not reduce the demand for primary education. Primary schooling is a necessary input into post-primary. In an educational system that is demand-constrained at the primary and supply-constrained at the post-primary level, the ‘prospect’ of post-primary schooling raises the primary return above the rate as conventionally measured. An application of the model to two countries — Côte d'Ivoire and Uganda — doubles the primary rate of return in each case.     

欧盟节能灯最新能效要求分析

本文对欧盟EuP指令最新推出的节能灯能效要求进行介绍，将其与国内外相关标准进行对比，同时对我国相关产业现状进行分析，在此基础上探讨了欧盟最新能效要求对我国照明产业的影响。     

零准备金制度下的货币政策操作框架研究

目前世界上越来越多的国家取消了对商业银行的法定准备金要求,不仅于此,英国、加拿大和澳大利亚等国家的中央银行还采用了通货膨胀目标制的货币政策框架,从而主要通过调控短期名义利率来实现既定的目标通货膨胀率,如此操作不但较好地实现了对宏观经济的调控,而且,相比较正法定准备金制度下的货币政策操作,在零准备金制度下,货币当局主要通过引导市场主体的预期来实现政策目标,从而在减少货币政策操作成本的同时,也使得中央银行有了更大的政策实施空间。