Public Debt and Economic Growth in Emerging Market Economies

This paper empirically studies the relationship between public debt and economic growth for selected emerging market economies by performing panel data estimations. The results reveal a statistically significant positive correlation between public debt and the subsequent growth rate of per capita gross domestic product (GDP). Population and investment are also positively correlated with per capita growth, whereas the initial level of real GDP per capita exerts a negative influence on growth, implying conditional convergence. Other variables such as the inflation rate, the trade balance or the exchange rate do not yield a statistically significant effect with respect to economic growth.     

Tax Competition and Tax Revenues

It is often feared that tax competition might lead to a “race to the bottom” and that the consequence of a reduction in tax rates on capital income would be shrinking capital income tax revenues and difficulties for national governments to perform their usual tasks. The following paper analyses what happened to tax revenues in a number of OECD countries. It turns out that taxes on capital income contribute to the financing of public expenditure to a more or less unchanged extent; nor are there significant changes in the level and structure of total tax revenues.      

Differences between Presidents' and Sales Managers' Perceptions of the Industry Environment and Firm Strategy in Small Industrial Firms: Relationship to Performance Satisfaction

The industrial sales force is the primary source of information about the competitive environment. Differences of perceptions of that environment between the national sales manager and the firm president in small industrial firms may reflect inadequate environmental information input into strategic decision-making. The sales force is a major element in implementation of strategy and differences between perceptions of firm strategy may reflect inadequate coordination and communication between the chief strategy decision-maker and the manager who is responsible for implementing that strategy in the market place. It would be expected that these differences in perceptions would impact negatively strategy formulation and execution resulting in unsatisfactory firm performance. This study surveyed the environmental and strategy perceptions of presidents and national sales managers in small to medium-sized industrial firms as well as presidents' satisfaction with firm profitability and marketing/sales effectiveness. The average absolute difference in environment perceptions has a negative relationship with satisfaction with profit. The average absolute difference in strategy perceptions has a negative relationship with marketing/sales effectiveness. This latter relationship is especially strong in an environment high in capital spending variation and for larger firms. The authors suggest implications for managers based on these results.     

Business and regulators partnerships: Government transformational leadership for constructive conflict management

Regulations are often thought to be impediments to collaboration between governments and businesses; however, governments and businesses are increasingly forming partnerships to help them negotiate regulation issues and more broadly work together. This study argues that governments, by exercising transformational leadership, lay the foundation for the cooperative approach, in contrast to the competitive and avoiding approaches, to conflict management that in turn results in effective partnerships. Findings from 146 pairs of government regulators and business support the hypothesis, though the evidence for the ineffectiveness of avoiding conflict was not statistically significant. Specifically, structural equation analysis results support the model that transformational leadership fosters cooperative approach to conflict and reduces competitive conflict management that in turn result in respectful, effective partnerships that develop industries.     

Management training in small and medium-sized enterprises: methodological and conceptual issues

The paper examines the impact of management training and development on the organisation and performance of small and medium-sized enterprises (SMEs), via a variety of quantitative and qualitative research techniques and including both crosssectional and longitudinal approaches to analysis. The paper demonstrates the value of management training and development in SMEs and demonstrates a series of one-off and longer lasting effects on their organization and performance. The paper also highlights the conditions under which management development projects are likely to be more successful. Finally, the paper extends the schema developed by Arthur and Hendry (1990) and Hendry et al. (1991), indicating the factors influencing training within businesses, and shows the indirect and complex links between management training and firm performance.     

The Non-Trivial Choice between Innovation Indicators

We discuss the strengths and weaknesses of five alternative innovation indicators: R&D, patent applications, total innovation expenditure and shares in sales taken by imitative and by innovative products as they were measured in the 1992 Community Innovation Survey (CIS) in the Netherlands. We conclude that the two most commonly used indicators (R&D and patent applications) have more (and more severe) weaknesses than is often assumed. Moreover, our factor analysis suggests that there is little correlation between the various indicators. This underlines the empirical relevance of various sources of bias of innovation indicators as discussed in this paper.     

Water in the desert? The influence of Wilhelm Röpke on Ludwig Erhard and the social market economy

It is commonly believed that Wilhelm Röpke heavily influenced Ludwig Erhard and, through him, West Germany’s social market economy. This article demonstrates that Röpke’s influence on Erhard was limited. Although the two men shared many common ideals, they also differed on many fundamental issues. Moreover, Erhard developed his ideas before he read Röpke’s wartime trilogy.     

Financial Issues and Catching up in Eastern Europe

MOCT-MOST: Economic Policy in Transitional Economies -     

What Would Normalisation of Economic Relations Between Mashrek Countries,Turkey and Israel Imply?

This article examines the potential for economic cooperation among Mashrek countries, Turkey and Israel in the fields of trade in goods and services both separately and across‐field. It first describes the macroeconomic features of the region and then estimates the overall potential for inter‐industry trade in goods by estimating gravity equations for each country separately and the potential for intra‐industry trade using Grubel‐Lloyd indices. The article also examines the potential for trade in specific services, namely information and computer technology, transport, financial and health services.