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Recent Working Papers
LABOUR MARKET MATCHING EFFICIENCY IN THE CZECH REPUBLIC TRANSITION
Pablo de Pedraza
WP No. 920
(April, 2008)
Abstract: Using the matching function and the monthly and yearly data from 1992 to 2000 of 76 Czech districts, this paper studies district specific characteristics affecting matching efficiency. Among the conclusions, it was found that the higher the educational level of the labour force and the higher the number of firms in new sectors, except in the commercial one, the more efficient the matching process. The results give evidence
supporting the idea that employed workers participate in the matching process and, therefore, they are one of the sources of increasing returns to scale in the Czech matching function. Small new enterprises in the commercial sector are also a source of
increasing returns.
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Jel Codes: J6, J64, J69
Keywords: Transition Labour Markets, matching efficiency
The Emerging Aversion to Inequality: Evidence from Poland 1992-2005
Irena Grosfeld; Claudia Senik
WP No. 919
(May, 2008)
Abstract: This paper provides an illustration of the changing tolerance for inequality in a context of radical political and economic transformation and rapid economic growth. We focus on the
Polish experience of transition and explore self-declared attitudes of the citizens. Using monthly representative surveys of the population, realized by the Polish poll institute (CBOS)
from 1992 to 2005, we identify a structural break in the relation between income inequality and subjective evaluation of well-being. The downturn in the tolerance for inequality (1997)
coincides with the increasing distrust of political elites.
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Jel Codes: C25, D31, I30, P20, P26
Keywords: inequality, subjective satisfaction, breakpoint, transition.
EXPLORING THE RELATIONSHIP BETWEEN MILITARY SPENDING & INCOME INEQUALITY IN SOUTH ASIA
Chaitanya V Krishna
WP No. 918
(April, 2008)
Abstract: The basic objective of this paper is to examine the effect of military spending on income inequality in four major South Asian economies. In the process, we also control for other possible key determinants of income inequality subject to data availability. Using panel regression fixed effects analysis for the study period 1975 to 2005, we find from our estimates that there is a positive effect of military expenditure on income inequality. Also we find there is a direct relationship between wartime military spending and income inequality and an inverse relationship between peacetime military spending and income inequality. Given the wide range of socio economic and political problems ailing South
Asia, these results gain paramount importance, suggesting that reduction in military spending could reduce income inequality, thereby paving way for economic development and progress.
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Jel Codes: H56, I30, O53
Keywords: Defense Spending; Income Inequality & South Asia
Productive, Unproductive and Destructive Entrepreneurship: A Theoretical and Empirical Exploration
Arnis Sauka
WP No. 917
(April, 2008)
Abstract: Drawing on Baumol’s concepts of productive, unproductive and destructive entrepreneurship and relevant amendments, this thesis aims to contribute to the entrepreneurship literature by developing a conceptual framework which allows operationalising the concepts for empirical assessment. Furthermore, using data from longitudinal survey, author makes one of the first attempts to address the concepts empirically. The results provide with support for the conceptual framework highlighting the importance to shift the focus from firms’ activities to output on both, venture and societal levels, short and long term, when concepts are addressed empirically. Overall findings suggest that productive entrepreneurs are those who are less involved in behaviour such as tax avoidance or illegal business and show a higher level of entrepreneurial orientation.
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Jel Codes: E26, H26, L26
Keywords: value creation; productive, unproductive and destructive entrepreneurship; transition context, small firms
MARKET RISK DYNAMICS AND COMPETITIVENESS: AFTER THE EURO: Evidence from EMU Members
Juan P. Chousa; Artur Tamazian; Davit N. Melikyan
WP No. 916
(February, 2008)
Abstract: In this paper we propose an empirical model that considers theoretical facts on the relationship between real exchange rates and the net exports of the economy to supplement the interaction of a number of financial and economic factors with the stock market. We discuss the impact of exchange rate
fluctuations on market risk in terms of Value at Risk (VaR). Our empirical findings show that common currency introduction produced increments in VaR whereas European stock returns are more sensitive to changes in competitiveness regarding the EMU rather than national exports. Finally, we show that the
synchronisation of variation in competitiveness through the introduction of a single currency has made these changes more decisive in explaining financial market fluctuations.
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Jel Codes: F33, G24, G28, O24
Keywords: Euro, Competitiveness, Market Risk, Net Export, Value-at-Risk, Volatility