A Quantitative Exploration on the Determinants of (De-)Industrialisation: The case of Greece

The aim of this paper is to explore the main determinants of (de-) industrialisation, taking Greece as a case study. Industrialisation in postwar Greece measured in terms of manufacturing industry's share of output was not impressive. It reached its peak (20.2% of GDP) in the mid 1970s and, since then, it followed a declining path. Relevant theory relates the evolution of industry to macro and micro variables, stressing the role of structural change or 'trading up' within manufacturing. The regression results underline that the reasons behind the unimpressive Greek industrialisation performance, compared with advanced capitalist economies, are to be found in the low GDP per capita, the deep and long economic recession and the unfavourable manufacturing trade conditions. The preponderance of traditional, low technology, consumer goods sectors over high technology industries is also found to affect negatively the share of manufacturing, but its statistical significance is relatively small. The implications for industrialisation policies are that macro-variables should preferably be used, since micro-tools are not likely to be particularly effective.     

Determinants of Hazard Confronting New Entry: Does Financial Structure Matter?

This paper attempts to identify the determinants ofhazard confronting 219 new manufacturing firmsestablished in 1982–84 and followed up to1992 using a Cox regression model. Three sets ofvariables are combined in the analysis: firm, sectorand cohort specific. Financial, firm specificcharacteristics such as larger initial financialcapital size, conservative borrowing, heavier fixedasset commitment and lower diversification in terms ofholding other firms' assets are estimated to reducefirm hazard. Higher sectoral entry and lower sunk costsectoral requirements by increasing marketcontestability increase risk of failure together withcyclical variations.     

Bank lending margins in the euro area: Funding conditions,fragmentation and ECB's policies

In this paper we study the determinants of lending margins paid by euro‐area corporates for their bank loans. Across two separate groups of countries (distressed and non‐distressed) we examine whether lending margins have been affected by structural changes in the banking sector, the credit and liquidity position of banks and the costs of funding in the corporate and sovereign bond markets. The role of ECB policies with respect to narrowing down the fragmentation in the bank lending channel is also investigated through a structural panel VAR model for the period 2003:1 to 2014:12.     

Efficiency spillovers from foreign direct investment in the EU periphery: A comparative study of Greece,Ireland, and Spain

Despite a growing number of empirical studies on efficiency spillovers arising from the presence of multinational firms for a number of countries, general conclusions on this issue have been inhibited by differences in the data sets and estimation techniques used across studies. In this paper we conduct a comparative empirical study for Greece, Ireland and Spain by creating comparable data sets and estimating identical models. Our results show evidence of spillovers in Ireland and Spain only, although these positive spillovers seem to depend on whether firms have the absorptive capacity to capture technological spillovers and the criteria used to classify them as foreign affiliates. JEL no. F23, O30     

Foreign direct investment and technology spillovers: Which firms really benefit?

Foreign direct investment is thought to contribute to host economies by increasing their efficiency either directly or through technology diffusion. Such efficiency benefits are neither equally produced by foreign firms nor equally distributed to all domestic firms. The special question addressed in this study is related to how differentiated such effects are depending on size and degree of (foreign) ownership. Based on a sample of 3,742 manufacturing firms operating in Greece in 1997, it is found that, while it is large, majority-held foreign firms that exhibit higher productivity, spillovers are important for small domestic firms and stem mostly from small joint ventures where the foreign partner owns a minor part of equity. JEL no. F23, O30     

Foreign ownership and production efficiency: a quantile regression analysis

This study analyzes the production efficiency gains in termsof technology transfer and labour productivity changes causedby diverse degrees of foreign ownership using a sample of 4,056manufacturing firms operating in Greece in 1997. Departuresfrom normality of labour productivity and its logarithm ledto the adoption of the robust technique of quantile regression.Interesting results include a positive effect on labour productivityof foreign ownership, which stems exclusively from full andmajority owned affiliates and becomes significant only in themiddle quantiles. Productivity spillovers benefiting local firmsare also differentiated, with minority holdings exercising astronger effect in most quantiles.     

BANKING CONCENTRATION AND FIRM GROWTH: THE ROLE OF SIZE,LOCATION AND FINANCIAL CRISIS

Using conditional quantile regressions for a panel of listed firms from euro‐area countries in the 2005–11 period, we explore the impact of banking concentration on firm growth between smaller and larger firms; core and periphery countries; in pre‐crisis and post‐crisis years. Our findings reveal that increasing banking concentration favours high‐growth larger‐sized firms located in periphery countries pre‐crisis. By contrast in post‐crisis years increasing banking concentration impacts negatively on low‐growth smaller firms irrespective of location, revealing their vulnerability.     

Monetary policy and inventory investment in Greek manufacturing industry

The paper reports an attempt to estimate the role of Greek monetary policy in inventory investment in manufacturing. Interest and inflation rate expectations exercise a significant influence. Expected fluctations in the exchange rate, for the first time examined, are of major importance especially for stocks of raw materials which are mostly imported. Being strongly affected by monetary variables, inventory investment can play a major role as a transmission channel of monetary policy changes to the Greek economy.     

Firm Growth and FDI: Are Multinationals Stimulating Local Industrial Development?

The aim of this paper is to improve our understanding of the empirical determinants of firm growth by extending the literature to include a new group of variables related to foreign direct investment (FDI), namely the degree of foreign ownership and technology spillovers. Based on recent developments in the field, our analysis also encompasses the role of sunk costs and financial constraints, while quantile regression techniques are adopted as more suitable to the data available (2,640 manufacturing firms operating in Greece in the 1992–1997 period). Our findings highlight the role of FDI in increasing firm growth with varying intensity depending on industry groups and regression quantiles, and vindicate the use of new variables.