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Doing Business in 2006: Creating Jobs

September 2005, ISBN: 0-8213-5749-2 SKU: 15749

This is the third in a series of annual reports investigating regulations that ease doing business and those that constrain doing it. This edition focuses on job creation. New quantitative indicators on business regulations and their enforcement can be compared across 150 countries and over time. The report updates the indicators presented in previous reports and adds three new sets of measures: paying taxes, getting licenses, and trading across borders. The indicators are used to analyze economic and social outcomes, such as productivity, investment, informality, corruption, unemployment and poverty, and identify what reforms have worked, where and why.

World Bank Working Papers

http://econ.worldbank.org/

Thomas Rutherford, David Tarr, Oleksandr Shepotylo

The Impact on Russia of World Trade Organization (WTO) Accession and the Doha Agenda: the Importance of the Liberalization of Barriers against Foreign Direct Investment in Service Industries for Growth and Poverty Reduction

WPS3725, October 2005

Taking price changes from the Global Trade Analysis Project (GTAP) model of world trade, the authors use a general equilibrium comparative static model, which is computable for a small open economy, to assess the impact of global free trade and successful completion of the Doha Agenda on the Russian economy, and especially on the poor. They compare those results with the impact of Russian accession to the WTO on income distribution and the poor.

Branko Milanovic

Half the World: Regional Inequality in Five Large Federations

WPS3699, September 2005

The paper studies regional (spatial) inequality in the five most populous countries in the world: China, India, the United States, Indonesia, and Brazil in the period 1980-2000. They are all federations or quasi-federations composed of entities with substantial economic autonomy. Two types of regional inequalities are considered: Concept 1 inequality, which is inequality between mean incomes (GDP per capita) of states/provinces, and Concept 2 inequality, which is inequality between population-weighted regional mean incomes.

Lev Freinkman, Alexander Plekhanov

What Determines the Extent of Fiscal Decentralization? The Russian Paradox

WPS3710, September 2005

The paper provides an empirical analysis of the determinants of fiscal decentralization within Russian regions in 19942001. The conventional view that more decentralized governments are found in regions and countries with higher income, higher ethnolinguistic fractionalization, and higher levels of democracy is not supported by the data. A more refined analysis points to the link between decentralization and the structure of regional government revenue: access to windfall revenues leads to a more centralized governance structure. The degree of decentralization also depends positively on the level of urbanization and regional size and negatively on income and general regional development indicators such as the education level.

Felix Eschenbach, Bernard Hoekman

Services Policy Reform and Economic Growth in Transition Economies, 1990-2004

WPS3663, July 2005

The authors find that reforms in policies in former centrally planned economies toward financial and infrastructure services, including telecommunications, power, and transport, are highly correlated with inward foreign direct investment. Controlling for regressions commonly used in the economic growth literature, they find that measures of services policy reform are statistically significant explanatory variables for the post-1990 economic performance of transition economies. These findings suggest services policies should be considered more generally in empirical analyses of economic growth.

Thorsten Beck, Luc Laeven

InstitutionBuildingand Growth in Transition Economies

WPS3657, July 2005

Drawing on the recent literature on economic institutions and the origins of economic development, the authors offer an explanation of the political economy of variations in institution building across transition economies. They identify dependence on natural resources and the historical experience of these countries during socialism as major determinants of institution building during transition by influencing the political structure and process during the initial transition years.

William Davidson Institute Working Papers

http://www.wdi.bus.umich.edu/

Nauro F. Campos, Francesco Giovannoni

The Determinants of Asset Stripping: Theory and Evidence from the Transition Economies

WP No. 786, August 2005

During the transition from a planned to a market economy, managers and politicians succeeded in maintaining control of large parts of the stock of physical capital. This paper applies models, measures, and investigates this process empirically. The authors argue that asset stripping is driven by the interplay between a firm's potential profitability and its ability to influence law enforcement. Econometric results for about 950 firms in five transition economies provide support for this argument.

Margaret Maurer-Fazio, James Hughes, Dandan Zhang

Economic Reform and Changing Patterns of Labor Force Participation in Urban and Rural China

WP No. 787, August 2005

The authors employ data from the Chinese population censuses of 1982, 1990, and 2000 to examine reform era changes in the patterns of male and female labor force participation and in the distribution of men's and women's occupational attainment. Very marked patterns of change in labor force participation emerge when the data are disaggregated by age group, marital status, sex, and rural/urban location. Women have decreased their labor force participation more than men, and urban women much more than rural women. Single young people in urban areas have decreased their labor force participation to continue their education to a much greater extent than single young people in rural areas. The urban elderly have decreased their rates of labor force participation while the rural elderly have increased theirs.

CERGEEI Working Papers

http://www.cerge-ei.cz/publications/working_papers/

Eugen Kovac

Speculation and Survival in Financial Markets

Working Paper 276, September 2005

Yan Chen, Peter Katuscak, Emre Ozdenoren

Why Can't a Woman Bid More Like a Man?

Working Paper 275, September 2005

Jakub Steiner

Coordination Cycles

Working Paper 274, September 2005

Frantisek Brazdik, Viliam Druska

Too Large or Too Small? Returns to Scale in a Retail Network

Working Paper 273, September 2005 Radim Bohacek, Michal Kejak

Optimal Government Policies in Models with Heterogeneous Agents

Working Paper 272, September 2005

Paul J.J. Welfens, Anna Wziatek-Kubiak (Eds.)

Structural Change and Exchange Rate Dynamics: The Economics of EU Eastern Enlargement September 2005, 288 pages

Edward M. Graham, Nina Oding, Paul J.J. Welfens (Eds.)

Internationalization and Economic Policy Reforms in Transition Countries

September 2005, 341 pages

Michael McFaul, Kathryn Stoner-Weiss (Eds.)

After the Collapse of Communism: Comparative Lessons of Transition

September 2005, 272 pages

Emilio Colombo, Luca Stanca

Financial Market Imperfections and Corporate Decisions: Lessons from the Transition Process in Hungary

August 2005, 174 pages

CASE Studies and Analyses

www.case.com.pl

Olga Pavlova, Oleksandr Rohozynsky

Labor Markets in CIS Countries

No. 311, October 2005

Inna Golodniuk

Financial Systems and Financial Reforms in CIS Countries

No. 306, September 2005

Vladimir Dubrovskiy, Oleg Ustenko

Business Climate in CIS Countries

No. 307, September 2005

LICOS: Center for Transitional Economies at Katholieke Universiteit, Leuven

http://www.econ.kuleuven.be/LICOS/DP/DP2005.htm

Joze P. Damijan, Andreja Jaklic and Matija Rojec

Does External Knowledge Induce Firms' Innovations? Evidence from Slovenia

Discussion Paper No. 156/2005

The paper analyzes whether, and to what extent, a firm's ability to innovate is induced by the firm's own R&D activity or by factors external to the firm. The paper finds that, firstly a firm's own R&D expenditures as well as external knowledge transfer, such as national and international public R&D subsidies, foreign ownership and intrasector innovation circulation enhance its ability to innovate. Secondly, innovations as a result of the firm's R&D contribute substantially to the firm's overall productivity growth. And third, foreign ownership has a double impact on the firm's TFP growth — it first enhances the firm's ability to innovate and then it additionally contributes to the firm's TFP growth via superior organizational techniques and other channels of knowledge diffusion.

Etleva Germenji and Johan F. Swinnen

Human Capital, Market Imperfections, Poverty and Migration: Evidence from Albania

Discussion Paper No. 157/2005

The paper analyzes the determinants of Albanian migration based on a survey of rural households. The study confirms that migrants are mostly young, male, and single. Regional variations in migration reflect a combination of cultural and economic factors, including migration costs. However, migrants are not found to come from the poorest rural households.

Pavel Ciaian and Johan F. Swinnen

Labor Market Imperfections and Agricultural Policy Impacts in the New EU Member States: A Partial Equilibrium Analysis

Discussion Paper No. 158/2005

Crt Kostevc

Performance of Exporters: Scale Effects or Continuous Productivity Improvements

Discussion Paper No. 159/2005

This paper asks whether, in addition to good firms self-selecting themselves into export activity, multinational production exporting further improves their performance compared with non-exporters. The estimations performed on the Slovenian sample indicate that more productive firms tend to self-select into more competitive markets, while there is no conclusive evidence of learning by exporting.

New Institutional Economics (NIE) has skyrocketed over the last three decades. Since the term was first coined by Oliver Williamson in 1975, the subject has exerted increasing influence over scholarly research. NIE studies institutions and how institutions interact with organizational arrangements. According to Douglass North's definition, new institutionalists aim to understand the process of economic change, as well as social or political change, by understanding human incentives and intentions and the beliefs, norms and rules that they create in pursuit of their goals. For new institutionalists, the performance of a market economy depends upon formal and informal institutions and modes of organization that facilitate private transactions and cooperative behavior. NIE focuses on how such institutions emerge, operate and evolve, and how they shape the different arrangements that support production and exchange, as well as how these arrangements act in turn to change the rules of the game.

This first handbook of NIE provides an overview of recent developments and broad orientations. One branch of NIE, covered in this handbook, focuses on the macro institutions that shape the functioning of markets, firms and other modes of organization: the state and the legal system. Another branch concentrates on the micro institutions that govern firms and their contractual relations. New institutionalists are also very much concerned with the interactions between the state and the firm. Increasingly, institutional economics has also focused on how institutions, both macro and micro, change; how they emerge, evolve and die. Because NIE is addressing new questions or new aspects of old questions and does not give new answers to the traditional questions of economics — resource allocation and the degree of utilization — its future is being shaped by new methodologies and a multidisciplinary approach. This handbook will be of interest to economists, political scientists, legal scholars, management specialists, sociologists, and others wishing to learn more and gain insight into progress made by institutionalists from other disciplines.

This compendium of analyses by some of the foremost NIE specialists — including Ronald Coase, Douglass North, Elinor Ostrom, and Oliver Williamson — summarizes the developments in the subfields of New Institutional Economics, and raises questions that leaders in the field consider crucial, and supplies scholars with tools for exploring answers to these questions.