The cyclical impact of EU cohesion policy in fast growing EU countries

Most of the newly acceded central and east European EU countries are among the main beneficiaries of EU Cohesion Policy. The main objective of this policy is to improve the long-term growth and employment prospects of the supported regions, and thereby to support convergence towards higher levels of per capita income. In the short run, however, EU Cohesion Policy may at times amplify macroeconomic challenges for supported countries. In periods of a downturn of the economy it can have a stabilising impact. During periods of unsustainably fast economic growth, however, its short-term demand effects may contribute to internal and/or external macroeconomic imbalances. Economic policymakers should thus ensure that EU Cohesion Policy enhances long-term productivity, while avoiding, in times of overheating, an increased risk of unsustainable developments as a result of the additional demand stimulus from EU Cohesion Policy. The opinions expressed in this article are those of the authors and do not necessarily reflect those of the European Central Bank. The authors are grateful to Martin Bijsterbosch, Gesa Miehe-Nordmeyer, Ad van Riet, Philipp Rother and Desom Weller for their helpful comments.     

The impact of agricultural price policy in developing countries

Agricultural price policies are under closer review now in many developing countries. There is a growing tendency to rely more on market forces. What impact have agricultural price policies had on the performance of the agricultural sector in developing countries until now?     

Cost of regulation and impact of EU membership on policy enforcement

Recent public debate on the costs and benefits of EU membership has focused more on the costs and less on the benefits. This paper explores the benefits from improved regulatory or policy implementation and enforcement. If actual regulatory enforcement differs from the socially optimal level, membership of a regional bloc that strengthens accountability mechanisms can improve the quality of implemented regulation. However, if the regional bloc tends to over-regulate, the overall increase in the regulatory burden, together with strengthened accountability, will move a country farther away from its socially optimal state. Membership of the EU is beneficial for countries with weak enforcement institutions, but it may worsen the welfare of countries with strong regulatory institutions. Infringement statistics indicate that no member state of the EU has a perfect record in implementation and enforcement.     

Eastward enlargement of the EU: Will agricultural policy be an obstacle?

The political preparations for enlarging the European Union to include the Central European countries are in full swing, but economic policy preparations have not yet begun. There is a need for adjustment primarily in the Central European countries, but also in sensitive areas in the EU itself, particularly the Common Agricultural Policy. Will agricultural policy be an obstacle to eastward enlargement?     

The chances for a thorough reform of the common agricultural policy

That the Common Agricultural Policy of the European Community is in need of reform is by now commonly accepted. But all moves for a reform on the political level have been postponed until after the French elections in the spring, a fact which highlights the political problems. Is there a real chance of a thorough reform of the CAP?     

The impact of the EC’s agricultural policy on its trade with developing countries

The European Community has frequently been blamed for impairing, through its highly protectionist agricultural policy, the development chances of Third World countries. Our article analyses whether, and to what extent, this reproach is justified.     

The impact of enlargement on EU environmental governance

Conclusions  Enlargement may affect the three environmental governance regimes which together constitute EU environmental policy in very different ways. The Internal Market regime is based on functional and utilitarian reproductive mechanisms rooted in structures—the institutionalisation of the Internal Market at the core of the Community and the interest of countries with low environmental product standards in harmonisation —that are unlikely to be strongly affected by enlargement. In contrast, it seems possible that enlargement will significantly weaken the environmental regime. If enlargement shifts influence in favour of countries supporting a low level of environmental regulation, this would seriously affect the power and utilitarian mechanisms on which the environmental regime is based. The highly regulated countries could no longer use the environmental regime as an instrument to impose their regulations on the remaining Member States. This would deprive the regime of its most important support base. However, emerging new mechanisms, in particular Enhanced Co-operation, may offer ways for the highly regulated Member States to maintain their superior position and adapt the environmental regime to enlargement. Finally, although the present conditions for environmental policy integration may be even worse in the accession countries than in many present Member States, this might change in the longer run as a result of the particularly good opportunities and potentially large benefits of a shift to sustainable development in these countries. Whether or not this shift will occur appears to depend less on scarce financial resources and administrative capacities of the accession countries than on a firm institutionalisation of the sustainability regime at the Community level. It is up to the highly regulated Member States, which have so far promoted this emerging regime, to achieve this consolidation under relatively favourable conditions before enlargement takes place. An earlier version of this article was presented at the conference “EU Enlargement and Environmental Quality in Central and Eastern Europe and Beyond”, Woodrow Wilson International Center for Scholars, Washington DC, March 14, 2002.     

EU competition policy: Article 82 EC and the notion of substantial part of the common market

EU competition policy acts as an important buttress to the Single European Market, with Article 82 EC specifically prohibiting the abuse of a dominant position in the common market or a substantial part of it. Therefore the substantial part notion acts as a boundary or subsidiarity test, determining whether the alleged abuse falls under Article 82 or member state law. This paper contends that two different and potentially competing substantial part tests have been legally sanctioned, namely the territorial test and the economic relativism approach. It further reveals that court rulings have been instrumental in determining not only how the two tests are to be applied in practice but also their respective usage pattern.     

NPD speed vs. innovativeness: The contingent impact of institutional and market environments

Whereas new product development (NPD) speed and product innovativeness are two critical strategic determinants of firm performance, previous studies show inconclusive findings about their effects. Drawing on institutional and contingency perspectives, this study elucidates value appropriation issues in NPD and examines how the effects of NPD speed and technological radicalness are contingent on institutional frameworks and market conditions. Results from 244 high-tech companies in China show that dysfunctional competition enhances the effect of NPD speed, but legal inadequacy hinders the impact of technological radicalness on firm performance. Market growth strengthens the performance effect of NPD speed but restrains the effect of technological radicalness. In addition, technological radicalness demonstrates stronger effects on firm performance when demand uncertainty is high.     

Location choices of multinational firms in Europe: The role of EU cohesion policy

Using data on 5509 foreign subsidiaries established in 50 regions of 8 EU countries over the period 1991-1999, we estimate a mixed logit model of the location choice of multinational firms in Europe. In particular, we focus on the role of EU Cohesion Policy in attracting foreign investors from both within and outside Europe. We find that, after controlling for the role of agglomeration economies as well as a number of other regional and country characteristics and allowing for a very flexible correlation pattern among choices, Structural and Cohesion funds allocated by the EU to laggard regions have indeed contributed to attracting multinationals. These policies as well as other determinants play a different role in the case of European investors as opposed to non-European ones.     

外商直接投资对我国经济发展的影响

随着改革开放的到来,我国一直是外商投资的目标之一,而且近几年有持续加快的趋势.但与此同时外资直接投资对我国经济发展有重要影响,本文在新的形势下分析了外来投资对我国经济的新的影响,并探讨了我国目前利用外资的一些注意事项.     

财政支出对民间投资效应的跨时差片和地区差异

本文研究财政支出对民间投资的效应是否存在跨时差异和地区差异。我们对比分析了1981-1993年、1994-2005年这两个时间段的回归结果,发现财政支出对民间投资的促进作用主要体现在1981-1993年。对财政支出效应地区差异的实证分析表明：虽然从全国范围看,财政支出总量无助于促进民间投资,但是分地区看,财政支出效应在中部最大,而在东西部并不显著。     

The impact of agricultural and trade policies on price transmission: The case of Tajikistan and Uzbekistan

This paper examines the extent and speed of price transmission from international to local markets in two transition economies, Tajikistan and Uzbekistan. The two countries have similar economic backgrounds, but a notable difference is that Tajikistan has adopted a more liberal agricultural trade regime than Uzbekistan. We use a vector error correction model to analyse how global agricultural prices are transmitted to domestic food prices in the two countries. We find strong cointegration between world market and domestic prices in Tajikistan for food crops but not meat, and no cointegration in Uzbekistan.     

The effects of loss aversion on trade policy: Theory and evidence

We study the implications of loss aversion for trade policy determination and show how it allows us to explain a number of important and puzzling features of trade policy. Some important questions concerning trade policy are why a disproportionate share of protection goes to declining industries and why trade policy has an anti-trade bias. We show that if individual preferences exhibit sufficient loss aversion, higher protection will be given to sectors in which profitability is declining. We also show that if the coefficient of loss aversion is large enough, there will be an anti-trade bias in trade policy. Using a nonlinear regression procedure, we find support for the model and the estimates of the loss aversion parameters are very close to those obtained by Kahneman and Tversky (Kahneman, D., Tversky, A., 1992. Advances in Prospect Theory: Cumulative Representation of Uncertainty. Journal of Risk and Uncertainty 5, 297-323.) with experimental data. Protection is found to be more responsive to losses than to gains, and the estimates of the coefficient of loss aversion are about 2. We also find evidence of loss aversion in lobby formation.     

A meta‐analysis of the indirect impact of foreign direct investment in old and new EU member states: Understanding productivity spillovers

In this paper, we summarise, combine and explain recent findings from firm‐level empirical literature focusing on the indirect impact of foreign direct investment (FDI ) on economic performance, measured as productivity, in the Enlarged Europe. We have reviewed 52 quantitative studies, released between 2000 and 2015 and codified 1,133 estimates. We run a regression of regressions which measures the strength of the FDI –productivity relationship. Taking advantage of large number of high‐quality studies on FDI and its role in explaining the growth in firms’ productivity in Europe, we adopt recent meta‐regression analysis methods—funnel asymmetry and precision estimate tests and precision‐effect estimate with standard errors —to explain the heterogeneous impact of FDI . This paper assesses the country‐specific impact of FDI on firms’ performance, after taking publication selection bias, econometric modelling and the individual studies’ characteristics fully into account. Our results show that on average FDI has a positive indirect impact on productivity. The impact is especially significant in selected European countries, and we interpret this as a sign of better absorptive capacities in those countries.     

The impact of home business network attributes on Chinese outward foreign direct investment

Researchers who take a network perspective argue that insidership in foreign market networks is a necessary condition for internationalization. In this study, we argue that insidership in home market networks also matters. The effect of home network insidership on outward foreign direct investment (OFDI) depends on both individual and joint effects of structural and relational network attributes. Our study based on a survey of 194 Chinese firms shows that firms in a central network position are more likely to engage in OFDI than those in a brokerage position. Furthermore, we find the interaction between firms’ centrality and their connections to foreign-invested enterprises to be significantly and positively associated with OFDI, whereas a significantly negative effect is evidenced when a firm is connected more to domestic firms.