Explaining regional disparities in Central and Eastern Europe

The paper analyses the determinants and the evolution of income disparities across regions within Central and Eastern European Countries (CEECs) over 1991–2011. We add to the literature in different ways. First, we adapt the categories that Rodriguez‐Pose used for studying convergence among old EU members to CEECs regions. This allows us to assess the relevance of geo‐sectoral groups (urban areas, old industrialized areas and peripheral areas) for newcomer regions. Second, we introduce a new category, that of ‘successful Foreign Direct Investment (FDI)‐based restructuring’ in order to capture regions that, often through considerable FDI, manage to reconvert their old industrial base. We then analyze whether this group helps understand catching‐up/falling behind processes in CEECs. We test the relevance of these groups by means of both non‐parametric and spatial regression analyses. We find that they help explain the increase in within‐countries’ regional disparities especially after the turn of the century.     

Riding the yield curve: a spanning analysis

The average return on long-term bonds exceeds the return on short-term bills by a large amount over short investment horizons. A riding-the-yield-curve investment strategy takes advantage of the higher returns on longer term bonds. This strategy involves the purchase of bonds with maturities longer than the investment horizon and the sale of these bonds, before they mature, at the end of the investment horizon. Most of the literature that evaluates this strategy compares only ex post average returns or Sharpe ratios. In this paper, we use spanning tests to provide formal statistical evidence on the benefits of investing in long bonds when the investment horizon is short. The results for both the United States and Canada indicate that an investor with a short horizon is better off investing in short-term debt instruments than long-term bonds.     

Does family ownership structure affect investment-cash flow sensitivity? Evidence from Italian SMEs

The aim of this article is to investigate whether family control, family management and family ownership concentration affect the investment-cash flow sensitivity of small- and medium-sized enterprises (SMEs). By analysing a sample of Italian SMEs for the period 2004–2013, I find that family-owned businesses are significantly associated with higher investment-cash flow dependence. This relation, however, is found to be driven by two distinct factors: (i) the presence of a highly concentrated family ownership (ownership concentration channel) and (ii) the active involvement of the family in the business (family management channel).     

A model for R&D performance measurement

R&D activities are increasingly costly and risky and, as a consequence, measuring their performance and contribution to value becomes critical. This paper illustrates a formal model for measuring R&D performance, based upon a balanced and synthetic evaluation of quantitative indicators from five different perspectives of performance: financial, customer, innovation and learning, internal business, alliances, and networks. The model is built in coherence with the suggestions coming from the theory of measurement in soft systems, which gives relevant guidelines for ensuring validity, objectivity and inter-subjectivity of the model. Then, an application in a real R&D setting is described, which helps to understand the model and to enlighten its main advantages and limits.     

Assessing Macroprudential Policies: Case of South Korea*

In this paper, we develop methods for assessing the sensitivity of capital flows to global financial conditions. We use these methods to assess the impact of macroprudential policies introduced by South Korea in 2010. Relative to a comparison group of countries, we find that the sensitivity of capital flows into South Korea to global conditions decreased in the period following the introduction of macroprudential policies.     

NONPARAMETRIC BOOTSTRAP PROCEDURES FOR PREDICTIVE INFERENCE BASED ON RECURSIVE ESTIMATION SCHEMES*

We introduce block bootstrap techniques that are (first order) valid in recursive estimation frameworks. Thereafter, we present two examples where predictive accuracy tests are made operational using our new bootstrap procedures. In one application, we outline a consistent test for out‐of‐sample nonlinear Granger causality, and in the other we outline a test for selecting among multiple alternative forecasting models, all of which are possibly misspecified. In a Monte Carlo investigation, we compare the finite sample properties of our block bootstrap procedures with the parametric bootstrap due to Kilian (Journal of Applied Econometrics 14 (1999), 491–510), within the context of encompassing and predictive accuracy tests. In the empirical illustration, it is found that unemployment has nonlinear marginal predictive content for inflation.     

The Commission,ENP and Construction of Borders

The thrust of the article is to investigate the reasons for the ambiguous character and results of the ENP. The argument is that these are a result of tensions inherent in the discourses produced at various sites in the EU that are involved in the development and implementation of the Policy. These tensions result in the simultaneous construction of mutually exclusive types of borders at the external edges of the EU. The main contribution of the present study to this argument is the detailed empirical evidence it provides for these tensions through the examination of the discourse of the European Commission. The article introduces the concept of soft/ hard borders as a very good analytical tool for studying the ENP and conducts a double-reading of the major types of Commission documents related to this Policy. The main finding is that at present some of the main hurdles the ENP is facing are a result of insufficient transformation of the assumptions and routinised practices that guide policy-making. These lead to underlying themes in Commission discourse that preclude the establishment of the necessary soft external border for the EU. Instead they promote the construction of more traditional hard borders.