Browsing by Subject "P26"

Sort by: Order: Results:

Now showing items 1-13 of 13
  • Roland, Gerard; Yang, David Y. (2019)
    BOFIT Discussion Papers 11/2019
    Beliefs about whether effort pays off govern some of the most fundamental choices individuals make. This paper uses China’s Cultural Revolution to understand how these beliefs can be affected, how they impact behavior, and how they are transmitted across generations. During the Cultural Revolution, China’s college admission system based on entrance exams was suspended for a decade until 1976, effectively depriving an entire generation of young people of the opportunity to access higher education (the “lost generation”). Using data from a nationally representative survey, we compare cohorts who graduated from high school just before and after the college entrance exam was resumed. We find that members of the “lost generation” who missed out on college because they were born just a year or two too early believe that effort pays off to a much lesser degree, even 40 years into their adulthood. However, they invested more in their children’s education, and transmitted less of their changed beliefs to the next generation, suggesting attempts to safeguard their children from sharing their misfortunes.
  • Delis, Manthos D.; Hasan, Iftekhar; Ongena, Steven (2019)
    Journal of Financial Economics 2
    Published in Bank of Finland Discussion Paper 18/2018 "Democratic development and credit".
    Does democratization reduce the cost of credit? Using global syndicated loan data from 1984 to 2014, we find that democratization has a sizable negative effect on loan spreads: a 1-point increase in the zero-to-ten Polity IV index of democracy shaves at least 19 basis points off spreads, but likely more. Reversals to autocracy hike spreads more strongly. Our findings are robust to the comprehensive inclusion of relevant controls, to the instrumentation with regional waves of democratization, and to a battery of other sensitivity tests. We thus highlight the lower cost of loans as one relevant mechanism through which democratization can affect economic development.
  • Delis, Manthos D.; Hasan, Iftekhar; Ongena, Steven (2018)
    Bank of Finland Research Discussion Papers 18/2018
    Does democratization reduce the cost of credit? Using global syndicated loan data from 1984 to 2014, we find that democratization has a sizeable negative effect on loan spreads: a one-point increase in the zero-to-ten Polity IV index of democracy shaves at least 19 basis points off spreads, but likely more. Reversals to autocracy hike spreads more strongly. Our findings are robust to the comprehensive inclusion of relevant controls, to the instrumentation with regional waves of democratization, and to a battery of other sensitivity tests. We thus highlight the lower cost of loans as one relevant mechanism through which democratization can affect economic development.
  • Frye, Timothy; Borisova, Ekaterina (2016)
    BOFIT Discussion Papers 9/2016
    Published online in the Journal of Politics
    How do flawed elections and post-election protest shape political attitudes? Taking advantage of the largely exogenous variation in the timing of a survey conducted in Moscow, we examine the short-term impact of the parliamentary election of December 4th, and the large protest of December 10th on trust in the Russian government. The fraud-marred parliamentary election had little effect on attitudes toward government, perhaps because allegations of vote improprieties were not new information. In contrast, the large protest of December 10th increased trust in government. Heightened trust arises largely from non-supporters of the ruling party updating their beliefs rather than from social desirability bias, a perceived improvement in government performance, or a “halo” effect. This finding is consistent with the view that autocrats can increase trust in government by unexpectedly allowing protest without repression. It also suggests that when evaluating trust in government citizens may cue not off the content of the protest, but off the holding of the protest itself.
  • Castañeda Dower, Paul; Pyle, William (2016)
    BOFIT Discussion Papers 17/2016
    Inefficiently organized, factory-dominated cityscapes have been one of the more enduring legacies of the twentieth century experiment with socialist central planning in Eastern Europe and the Soviet Union. Drawing on a unique survey of large, formerly state-owned urban industrial firms in Russia, we explore how land tenure reforms affect the pace at which this legacy is being erased. Specifically, the privatization of plots is shown to promote the development of a rental market that transfers land use rights away from socialist-era industrial users. We address the potential endogeneity of land tenure in two ways, including using a measure of regional variation in urban land policy as an instrumental variable.
  • Merlevede, Bruno; Schoors, Koen (2005)
    BOFIT Discussion Papers 11/2005
    Published in Journal of Economic Policy Reform, 2007, Vol.10, No.1, pp. 29-50
    We analyse how the choice of reform speed and economic growth affect one another.We estimate a system of three equations where economic growth, economic reform and FDI are jointly determined. New reforms affect economic growth negatively, whereas the level of past reform leads to higher growth and attracts FDI.This means that the immediate adjustment cost of new reforms is counterbalanced by a future increase in FDI inflows and higher future growth through a higher level of past reform.Reform reversals contribute to lower growth.We use the model to simulate the impact of big bang reform and gradualist reform on economic growth.This is only meaningful in the presence of reform reversals, which requires aggregate uncertainty about the appropriate reform path.Using the coefficients from the empirical model, we find that even relatively small ex ante reversal probabilities suffice to tilt the balance in favour of gradualism. The case for gradualism gains strength if policymakers are short-sighted, but weakens if voters are myopic. JEL Classification: O57, P21, P26, and P27 Keywords: policy reform, gradualism, big bang, FDI, economic growth
  • Paustyan, Ekaterina (2021)
    BOFIT Discussion Papers 2/2021
    This paper studies the distribution of politically motivated intergovernmental transfers in Russia focusing on the case of the 2018 FIFA World Cup. It investigates what factors have accounted for the selection of the 2018 FIFA World Cup venues. Qualitative Comparative Analysis of 14 cases reveals that well-connected political elites were able to secure the right for their regions to host the championship and, as a result, to extract additional funds from the center. These findings are in line with the argument that the regional governments in Russia play an important role in the distribution of politically sensitive transfers. Taking into account that these transfers have been increasing over the past years, there is no surprise that the regional elites have developed various lobbying strategies and mechanisms for attracting them.
  • Pyle, William (2020)
    BOFIT Discussion Papers 17/2020
    This article links Russians’ individual experiences during the late-Gorbachev and early-Yeltsin years to the beliefs those same individuals espoused in the Putin era, over a decade later. Drawing on questions, some of which are retrospective, from the first wave of the Life in Transition Survey, I show that a range of attitudes – including diminished support for markets and democracy and stronger support for reducing inequality – can be explained by whether an individual suffered labor market hardships (wage cuts, arrears, and/or unemployment) in the half decade from 1989 to 1994. More recent labor market disruptions, surprisingly, bear no such relationship to beliefs in 2006. Relative to the rest of the former Soviet Union, this pattern is unique. Though an explanation is difficult to pin down, one speculative hypothesis is that Russians were uniquely impressionable during this exit-from-communism period. Individual economic hardship, in conjunction with the dissolution of the Soviet Union, may have been particularly disorienting for those living in the country in which communism first took root. Life experiences during these years of instability, uncertainty, and diminished status may have left a uniquely deep and enduring impression.
  • Mattlin, Mikael (2007)
    BOFIT Discussion Papers 10/2007
    This paper reviews recent regulatory and policy changes that affect the Chinese central government's ownership and authority over the capital allocations of strategic state-owned enterprises (SOE).The paper examines the reform of the central government's relationship with key SOEs as a consequence of the establishment of the State Assets Supervision and Administration Commission of the State Council (SASAC) in 2003, the coming introduction of a centralised operating and budgeting system for SOEs, and the government's ongoing re-evaluation of its ownership policy.SASAC appears to have the potential to develop into a major actor in China's domestic capital allocation, with an active role in strategic financing and restructuring of key sectors of the Chinese economy. The data reviewed for this paper strongly suggests that the Chinese central government aims to retain significant ownership control over key SOEs and, by extension, over a major part of the domestic economy.The new operating and budgeting system is set to significantly enhance central government control over SOEs' capital allocation. Key words: State-owned enterprises, privatisation, corporate governance, China JEL classification: G32, G38, P26, P31
  • He, Qing; Li, Xiaoyang (2020)
    BOFIT Discussion Papers 27/2020
    We investigate the influence of financial and political factors on peer-to-peer (P2P) platform failures in China’s online lending market. Using a competing risk model for platform survival, we show that large platforms, platforms with listed firms as large shareholders, and platforms with better information disclosure were less likely to go bankrupt or run off (platform owners abscond with investor funds). More importantly, failing platforms were much less likely to run off in advance of major political events, but more likely to declare bankruptcy or run off after such events. These effects are more pronounced for politically connected platforms, platforms operating in provinces where local officials have close ties with central government, and in provinces with better local financial conditions. Our study highlights the role of political incentives on government regulatory intervention in platform failures.
  • Pyle, William (2011)
    BOFIT Discussion Papers 26/2011
    The voluminous literature on the privatization of Russian industry overlooks, almost completely, the story of enterprise land rights - a story that does not jibe well with the standard narrative of post-Soviet reform. This paper explains the path that has led to significant inter-regional variation in the ownership status of lands underneath urban industrial enterprises. It then introduces unique data from a survey of 359 large industrial firms across several dozen of Russia's largest cities to explore why some firms have purchased their production plots whereas others continue to lease or hold these lands under the old Soviet system of tenure. In exploring both inter-regional and inter-firm variation in land rights, we find evidence consistent with the proposition that the decisions of regional officials and (the managers and owners of) firms are guided by securing rights over real estate rents. Keywords: urban land, property rights, Russia JEL codes: K11, L6, P26, P31, R33
  • Kim, Byung-Yeon; Pirttilä, Jukka (2003)
    BOFIT Discussion Papers 4/2003
    Published in Journal of Comparative Economics, Vol.34, No.3 (2006), pp. 446-466 as "Political constraints and economic reform: Empirical evidence from the post-communist transition in the 1990s"
    Using a novel data set from post-communist countries in the 1990s, this paper examines linkages between political constraints, economic reforms and growth.A dynamic panel analysis suggests public support for reform is negatively associated with income inequality and unemployment.Both the ex post and ex ante political constraints of public support affect progress in economic reform, which in turn influences economic growth.The findings highlight that while economic reforms are needed to foster growth, they must be designed so that they do not undermine political support for reform. Keywords: Political constraints, economic reform, transition, growth, dynamic panel models, JEL classification: P26, O11, C33
  • Everaert, Greetje M.M. (2004)
    BOFIT Discussion Papers 12/2004
    In today s increasingly competitive business environment, many firms in declining industries have been confronted with the need to restructure.However, lobbies in these industries have often managed to attract government subsidies instead.This paper looks at the decision of a loss-making firm whether to lobby for subsidies or whether to restructure in the context of a contributions game as in Magee et al.(1989).We further analyse the role of tariffs in restricting uncompetitive practices such as granting state aid to unprofitable firms.Several results stand out.Firstly, there is a trade-off between spending resources on lobbying for subsidies and costly restructuring such that both restructuring and subsidisation take place in our model.Secondly, countervailing tariffs on subsidised exports shift the decision in favour of restructuring, thereby hardening budget constraints. Hence, the model illustrates that external constraints such as countervailing tariffs can help to establish internal financial discipline when first-best solutions are politically unfeasible. Thirdly, the social planner always prefers full restructuring implying that political competition comes at a cost of lower economic welfare in our model. JEL classification: P26, F13 Keywords: soft budget constraints, restructuring, political economy, lobbying, trade policy, declining industries