The size and development of the shadow economy: An empirical investigation from states of India

Using the state level data from India, this paper investigates the size of the hidden economy in Indian states over the period 1974/75 to 1995/96. Our analysis has shown that after liberalization of the Indian economy in 1991/92, the growth in the size of the hidden economy has decreased on an average. Our results show that the growth in the size of the hidden economy is approximately 4% less in scheduled election years than in all other years. We also demonstrate that the growth is significantly lower in those states where the coalition government is in power. An increased growth of newspapers and the literacy rates translate to cleaner governance, e.g. to fewer amounts of shadow economy activities in the economy.     

Protecting Property: The Politics of Redistribution,Expropriation, and Market Openness

This paper develops a formal model to disentangle the competing political incentives for redistribution, expropriation, and market openness. Although redistribution and expropriation are both types of government extraction, redistribution re‐allocates wealth within the citizenry, while expropriation re‐allocates wealth from citizens to the government. Representative political institutions increase redistribution and reduce expropriation. Market openness changes these incentives, as foreign investors prefer reductions in both redistribution and expropriation. When political institutions are representative, the government will rely more on reducing expropriation, rather than limiting redistribution, to attract foreign investment. Under representative institutions then, openness partially reinforces the preferences of voters rather than undermining them. In addition, market liberalization occurs only when the policy changes needed to attract foreign investment are relatively small. If existing policies are satisfactory to foreign investors, moves toward openness may be accompanied by greater redistribution and expropriation, as governments are tempted by a larger base for extraction. Thus, openness has ambiguous effects on economic policy, at times encouraging and at times constraining extraction.     

Political entrepreneurs and electoral capital: the case of the Israeli State Economy Arrangement Law

This article looks at a specific institutional change in Israel. In 1985, Israeli politicians adopted the “State Economy Arrangement Law” (SEAL), commonly regarded as part of the budgetary legislation in Israel. This law became an alternative channel through which applicants could circumvent the necessity of applying to the Israeli parliament (the Knesset) for the implementation of certain policies. This law enabled an accelerated, flexible regulatory process that short circuited democratic discussion in the Knesset and obviated the intervention of Israeli consumer organizations. This article suggests that this institutional change should be analyzed as part of a process where institutional reality influences individual and collective beliefs, thus triggering an individual and collective learning process that eventually leads to institutional change, specific policies and outcomes in terms of economic performance. The article also claims that the SEAL legislation is an equilibrium that results from the actions of political entrepreneurs (or agents of change) who operate to maximize their own electoral capital against the backdrop of certain structural and cultural conditions, both local and international. They operate in an environment characterized by the inability of the government to function effectively (non-governability) and the development of an alternative political culture.

Police Violence and the Underreporting of Crime

This paper examines the relationship between police violence and the reporting of crime. Utilizing original data from a large‐scale household survey conducted in Costa Rica from October 2013 to April 2014 (n = 4,200), we find that the observation of police violence significantly reduces citizens’ willingness to report crime. The implications of this finding are explored using a game‐theoretic model of crime, crime reporting, and police misconduct. The model reveals that although the prospect of police violence against criminals may generate a degree of deterrence for criminal behavior, permissiveness toward police violence also raises expectations about the likelihood of police abuse against law‐abiding citizens. Consistent with our empirics, this reduces citizens’ propensity to report crime, thereby fostering a climate of impunity for criminal activity.     

促进中部崛起的科学基础与国家援助政策

本文在对“中部塌陷”现象进行深入分析的基础上,探讨了促进中部崛起的科学基础、战略目标和定位以及国家援助政策。作者认为,近年来中部地区出现的塌陷现象并非是全国最严重的,其“增长塌陷”不如东北地区,而“水平塌陷”不如西部地区。促进中部崛起是一项长期的艰巨任务,当前应针对中部地区的典型问题区域,实施有差别的国家援助政策。     

U.S. policy in the euro crisis and the institutional deepening of the monetary union

ABSTRACT

Theoretical approaches to European integration often downplay and sometimes ignore the role of external actors. But the regime complex through which the euro crisis of 2010-2015 was prosecuted involved the United states directly and indirectly through the IMF. Tracing such external involvement shows that, although they preferred greater deepening of euro area institutions than was achieved, U.S. and IMF officials nonetheless contributed substantially to the creation of the EFSF/ESM, robust ECB action and launch of the banking union project. The conclusion formulates falsifiable expectations on which a theory of external influence in regional integration can be developed and tested.     

Short- and long-term relation between economic development and government spending: the role of quality of institutions

ABSTRACT

This paper tests the Wagner’s assumption of the one-sided directional flow moving from economic growth to public spending considering an international database over the 1996–2012 period. By using indicators on the level of country control of corruption, government effectiveness, political stability, rule of law, regulatory quality and voice and accountability, the paper analyses the economic performance-public spending nexus controlling for the quality of the institutions. The empirical evidence supports the existence of the Wagner’s law, showing that, in the short-run, public spending positively reacts to a positive shock in national income, with a lower magnitude for democratic countries. In the long run, the error-correction model shows the convergence between public spending and national output occurring less quickly for non-democratic, low-income and to a smaller extent for non-OECD countries. Institutional quality, such as effort in controlling corruption and the presence of regulations that permit and promote private sector development, may help reducing the amount of per capita public spending and making it more productive. Higher expenses in compositional amenities such as public services for the elderly may explain why public spending per capita will increase the most in economies with a higher share of the population that need healthcare facilities.     

The temporal dynamics of technology promises in government and industry partnerships for digital innovation: the case of the Copyright Hub

What is the expectation work required to ensure that technological innovation initially supported by government funding is subsequently taken up by market actors? This paper explores this question by applying a linked ecologies framework to the study of the Copyright Hub, a digital infrastructure for Intellectual Property trading developed in the UK. We draw our analysis from a five year long study, including forty-six interviews and six weeks of participant observation. We found that expectation work in policy-led infrastructural communities entails (1) leveraging technology to reshape the position of actors in the innovation space; (2) exploiting the different temporalities of expectation work in allied ecologies and (3) mobilising ‘slow’ expectations to provide momentum to the newly arranged innovation space. Highlighting difference in temporal dynamics for the various partners involved as a ‘hinging’ factor, our analysis contributes to clarifying the complex temporal alignment of policy and innovation processes in technology projects.     

The relationship between efficiency and profitability with respect to the size of firms: An empirical investigation for Austria

In this paper, an attempt is made to investigate the performance of Upper-Austrian firms by size class. Considering the six derived hypotheses, why small firms have a better performance measure, some of the hypothesis with respect to profitability and labour cost efficiency are confirmed. On average, the gross residual quota (profitability measure) of small firms is higher than the one of medium-sized and large firms. However, a similar result could not be found for the productivity development. Considering the influence of the firm size on the productivity measure, there is in three out of four cases no statistically significant influence at all and in one case the opposite result is obtained indicating the larger the firm, the higher is the productivity. In the case of labour cost efficiency, the hypothesis (the smaller the firm the lower the labour cost per employee) is clearly confirmed.     

长波理论的数理解析及其对新发展格局的启示——纪念我国著名马克思主义经济学家高峰先生

高峰先生是我国马克思主义政治经济学与现代资本主义研究领域的著名专家.先生视野开阔、涉猎广泛,在其众多的研究著述之中对长波理论的考察格外引人瞩目.本文系统地回顾了先生针对资本主义经济长波,从资本积累理论切入,所提出的"技术—制度—市场"三元分析框架.在此基础上,尝试构建一个包含着异质性资本的单一部门模型,以说明技术变迁和...     

Industrial policy, competence blocs and the role of science in economic development

Government is studied as supporter of science and of the transformation of scientific discoveries into new technology and firm formation. The importance of scientific discovery outside academe is recognized as is the experimental nature of the transformation process entailing frequent business failure. Competence bloc theory is used to understand the minimum set of actors with competence needed for the incentive structure to be complete and the risk of losing the winners minimized. Competence bloc analysis also helps clarify the theoretical foundations of industrial policy and useful roles for science parks. I find that to succeed as a catalyst for industrial competitiveness park management should be less concerned with science and technology and more with the economics of the transformation process.     

从使用价值和虚拟价值不对称视角解读美国施压人民币升值问题

从使用价值和虚拟价值不对称视角分析美国施压人民币升值问题,提出基于使用价值的实物流和基于虚拟价值的信息流不对称导致了中美贸易的不平衡,信用体系不对称导致了中美经济结构的差异,以及对广义虚拟经济主导权的争夺是美国施压人民币升值的根本原因.最后给出政策建议:缓解人民币升值压力要大力发展文化产业,根本解决人民币升值压力要掌握...     

The tax-rate induced bond substitution hypothesis and the traditional textbook treatment of the relationship between tax-free and taxable bond yields

ABSTRACT

This empirical study posits and tests the ‘tax-rate induced bond substitution hypothesis,’ wherein the propensity for bond buyers to substitute tax-exempt municipal bonds for taxable bonds in their portfolios is hypothesized to be an increasing function of the maximum federal personal income tax rate. This substitution acts to elevate the real interest rate yield on taxable bonds while diminishing it on tax-exempt bonds, ceteris paribus. Two measures of real interest rates are included in the present analysis, ex post real interest rate and ex ante real interest rate. Empirical estimations for the 1981–2018 period provide strong support for the hypothesis. They reveal that the real interest rate yield on high-grade tax-exempt municipal bonds is a decreasing function of the maximum marginal federal personal income tax, whereas the real interest rate yield on taxable ten-year Treasury notes is an increasing function of that same tax rate. We examine the implications of this study and the information underlying it for the traditional formulaic textbook treatment of the relationship between yields on bonds whose interest rate payments are taxable versus those whose interest rate payments are tax exempt and find it is not as dependable as the textbooks would have us believe.