Determinants of Bank Performance in Transition Countries: A Data Envelopment Analysis

We analyze what drives bank efficiency in the transition countries of Central Europe and compare the results with those for the United States. This paper is one of the few that use data envelopment analysis for the computation of efficiency scores in transition countries, and, to our knowledge, it is the first to explore systematically how different specifications of data envelopment analysis affect the results. Our findings corroborate the common wisdom that foreign-owned banks operating in transition countries are more efficient than domestic banks. While in the United States large banks are in general more efficient, the result for transition countries depends on the design of data envelopment analysis.     

Bank Efficiency in Transitional Countries: Sensitivity to Stochastic Frontier Design

This article provides an empirical insight on the heterogeneity in the estimates of banking efficiency produced by the stochastic frontier approach. Using data from five countries of Central and Eastern Europe, we study the sensitivity of the efficiency score and the efficiency ranking to a change in the design of the frontier. We found that the average scores are significantly smaller when the transcendental logarithmic functional form is used in the profit efficiency measurement and when the scaling effect is neglected in the cost efficiency measurement. The implied bank ranking is robust to changes in the stochastic frontier definition for cost efficiency, but not for profit efficiency.     

The course and drivers of the forest transition: The case of France

Deforestation in developing countries has given rise to much concern in recent years. Until the early 19th century, many now-developed countries such as France experienced similar deforestation. Net deforestation then gave way to net reforestation: this shift is defined as the forest transition. The courses and drivers of forest transitions are not well understood: until a better understanding is achieved, it will be difficult to evaluate the prospects for comparable forest transitions to occur in developing countries. This paper aims to advance the understanding of the forest transition by analysing its occurrence in France. It concludes that the transition can be understood in terms of a crisis-response model, set in the context of a number of necessary factors. It also indicates that the forest transition was accompanied by a paradigmatic shift from the pre-industrial to the industrial forest, the former relating to local use for a diversity of purposes and the latter geared to the perceptions and needs of the urban-industrial state.     

Innovation Propensity in the EU Candidate Countries

Innovation activities in transition economies generally lag behind developed economies. This is also the case in the latest group of EU candidate countries whose innovation performance lags behind EU-27 average. In this paper we analyze the innovation propensity of firms in EU candidate countries (Croatia, FYR Macedonia, Montenegro and Turkey). The analysis relies on the Business Environment and Enterprise Performance Survey (BEEPS 2009) data. By employing probit model we have identified determinants of innovation propensity in analyzed countries. The results point to external factors such as the subsidies, customer pressure to innovate, obstacles from high tax burdens, political instability and inadequate education of workforce as significant positive predictors. Based on the results, few innovation policy recommendations are proposed.     

Silencing the Call to Action: A Bird’s Eye View of Minority Language Media and Political Participation in Eurasia

Do citizens living in linguistically diverse countries without benefit of diverse media outlets find this to be a barrier to civic engagement? This study considers the interrelated effects of media access and social capital on political engagement in 15 Eurasian countries as that region continues to transition to an open economy and democracy. Drawing upon individual-level survey data, and controlling for relevant political and socioeconomic factors, regression analyses suggest a significant impact of media plurality, interpersonal trust, and government confidence on both voting turnout and unconventional political participation. The effect of social capital is mixed. Results indicate that higher levels of trust contribute to participation, while greater confidence in government is associated with less participation. These preliminary tests also show that collective action is generally lower in countries having greater linguistic diversity, but suggest that having access to political news in one’s own language can indeed contribute to more activism.     

Reflections on the Green Growth Index for developing countries: A focus of selected African countries

This article presents a pilot and baseline African Green Growth Index (AGGI). The work is premised on the importance of Africa implementing green growth strategies. Baseline indicators allow countries to monitor progress towards green growth transition. The AGGI incorporates 48 indicators applied to 22 countries that had the requisite data. What emerges is that 18 out of the 22 African countries sampled scored 50 percentage points and above. The countries scoring below this threshold were: Egypt, Algeria, Nigeria and South Africa. The top five countries on the AGGI (as ranked from 1−5) were: Namibia, Zambia, Ghana, Tanzania and Togo. The authors recommend that for wider acceptance across the continent, the AGGI should work towards incorporating all 54 nations.     

Measuring the Efficiency of Health Services in Lower‐income Countries: The Case of Papua New Guinea

Papua New Guinea (PNG) faces enormous health challenges and information concerning how to allocate limited health resources efficiently is lacking. This article finds that geographical location is important in achieving higher efficiency scores. In addition, it compares efficiency scores against a range of quality indicators. The results demonstrate that different conclusions are reached when efficiency scores are assessed in the context of broader health system objectives. Analyses of this kind can provide valuable information to policy‐makers in lower‐income countries.     

Sustainability and counteracting factors to profit rate decline

This paper discusses sustainability implications of barriers to growth as specified in the theory of the long-term falling rate of profit but focusing on the counteracting factors (CFs) specified by Marx. These depend much on political processes and are important in state theory for understanding policies of national and international institutions. Fourteen partly overlapping factors are identified and grouped in five categories: increased pressure on labor, geographical expansion, resource efficiency, technological progress, and destruction or devaluation of capital. It is suggested that there are limits to all of them and also that there is much room for continued capitalist growth. While the drive toward resource efficiency can contribute to sustainability, other CFs work against this. But increased sustainability requires the retirement of resource inefficient and carbon intensive technologies which implies a destruction of capital that will counteract the falling rate of profit. This will require sustained political intervention.     

FDI Determinants: Case of Romania

Even if the FDI is important for all host countries, for those in the process of transition to a market economy the FDI presence is critical under many respects. Not all transition countries benefited from the very beginning from the FDI presence. Several determinant factors explain the differences. Romania was lagging behind regarding the interest of foreign investors during the first 9–10 years of transition. The situation has improved greatly. The aim of this paper is to identify the main factors determining the evolution in the FDI/GDP (%) as proxy for the FDI evolution. To this end, we used the method of factors analyses. The four resulted determinant factors are: Market size and potential, Reform progress, Business liberalization, and Labor cost. A linear regression model expresses the connections between dependent variable and the four determinant factors. The paper concludes with certain policy implications.

The Money–Happiness Relationship in Transition Countries: Evidence from Albania

With an empirical analysis on a panel of individuals living in a transition country (Albania) we document that the impact of money on happiness does not depend only on the pecuniary outcome but also on aspirations and conditions leading to its determination. Additional factors which matter are the self perceived economic status and the share earned from remittances (and, more weakly, from social assistance). By looking at different sides of the phenomenon we find that these factors affect levels, changes in income and the probability of being “frustrated achievers”. Finally, unlike what happens in developed countries, higher income levels are negatively and not positively correlated with the probability of frustrated achievement thereby supporting the hypothesis that individuals in transition countries are not in the upper side of a concave happiness-income relationship.     

Bureaucratic manoeuvres and the local politics of climate change mitigation in China and India

This article explores how strategies of thinking and working politically are used by agencies within developing country governments to influence wider government agendas. It uses research on climate change mitigation in China and India to explore how government agencies seek to overcome challenges of limited capacity and competing priorities by bundling climate change together with more immediate priorities and thereby developing a coalition with an interest in achieving these objectives. The article is based on interviews conducted in China and India, as well as analysis of themes covered in the growing body of literature on the domestic politics of climate change mitigation. In both countries we found that pragmatic approaches leveraging what already exists made significant progress in putting energy efficiency on the agenda, strengthening institutional presence (in India) and delivering improvements in energy efficiency (in China). Yet, we also found that the use of these tactics had significant limitations. While there was probably no other way that the policy space given to climate change mitigation could have increased so rapidly, there are significant side effects that arise as a result of the traction gained by these initial policy approaches. While bundling raised the profile of energy efficiency, it also created perverse incentives that highlight the need to consider the long‐term effect on the interests, capacity and sustainability of informal coalitions. We highlight the need to take account of both the short‐ and long‐term effects of thinking and working politically, and the challenges of doing so when the outcomes are unpredictable and inherently difficult to assess.     

Well-being and unemployment in Russia in the 1990s: Can society's suffering be individuals’ solace?

This paper studies the effect of regional unemployment rates on subjective well-being in post-Soviet Russia. Research in Europe and the U.S. finds that higher unemployment rates lead to lower reported life-satisfaction. By contrast, our Russian study finds a small but significant effect in the other direction. We estimate that each percentage point increase in the local unemployment rate is correlated with an increase in the average well-being of people in the region which is equivalent to moving 2% of the population up one point on the five-point life satisfaction scale. Our intuition is that when individuals observe their peers suffering in a troubled economy, they lower their standards of what is good enough. All else equal, they perceive themselves to be better off in worse times. This unusual result highlights the role of psychological and contextual factors in mediating responses to economic incentives, particularly in crisis or transition. The dependence of subjective well-being scores on expectations and reference groups cautions against using happiness data from economies in crisis to draw macroeconomic policy conclusions.     

Building Social Capability for Economic Catch-up: The Experience and Prospects of the Post-socialist Countries

The post-socialist countries are, by the standards of the EU, poor countries. The major developmental task facing these countries is, therefore, that of catching up with their more prosperous neighbours. The scope for catch-up is defined in terms of the levels of social capability exhibited by these societies and their capacity to establish technological congruence with the leading firms from the advanced industrial economies. S&T systems in the broadest sense are shown to be key factors in relation to both social capability and technological congruence. Detailed analysis of the transition countries indicates that the catch-up process is hampered across the board by specific gaps in social capability and elements of technological incongruence. These can in turn be traced to specific structural trends, in particular in relation to foreign investment, and to specific weaknesses of institutional development, cutting across the public/private dividing line, notably in relation to R&D systems and banking systems. Consideration of all these factors suggests that there can be no assumption that the transition countries will automatically catch up with western Europe, and that some disfavoured transition countries may, indeed, continue to fall behind.     

Workers’ Remittances and Domestic Investment in South Asia: A Comparative Econometric Inquiry

This study explores the effect of workers’ remittances on domestic investment in four selected South Asian countries: Bangladesh, India, Pakistan, and Sri Lanka, using contemporary time series estimation techniques from 1980 to 2017. The estimated results of the ARDL bounds approach to cointegration analysis have revealed that among selected South Asian countries, Pakistan has witnessed a significant negative effect in the long run. Similarly, the findings of other forms of capital flows also revealed varying effects across the countries considered. This study urges the transformation of aggregate economic behaviour from consumption to the production side, by adopting policies that would encourage domestic saving and investment activities. In this regard, among others, reduction in the interest rate and the interest rate spread would be beneficial. It urges the identification of factors that conditions varying effect of workers’ remittances and other capital inflows to mitigate negative effects into positive.     

Transatlantic Roundtable on High–skilled Migration and Sending Countries Issues

Globalization and the advent of the knowledge economy have created a new context where there is a greater demand for the highly skilled, especially in the information technology (IT) industry. High–skilled migration has become increasingly more complex, even if in recent years the term "brain drain" has become a generic reference to "high–skilled migration" of all types. It has also become clear that brain mobility does not automatically translate into "brain drain", and that impacts vary by the types of skills held by migrants.
The meeting demonstrated that while much is known about high–skilled migration and its effects on source countries, there is also a great deal yet to be learned in a dynamic environment. Many participants deplored the lack of reliable data, which makes it difficult to know what is really going on and to establish appropriate policies. Clearly, there are an array of policies that can offset possible adverse effects of skilled mobility and even leverage the flow into positive outcomes for source countries. A key element is improvement of the population's general level of education. Low levels of skills keep average labour productivity and wages low and therefore retard development. Long–term strategies to promote economic growth are needed to enable developing countries to retain and draw back their highly skilled and address the negative effects of the brain drain. Migrants themselves can play an important role through their remittances, diaspora networks, and own willingness to return – at least temporarily — to share their skills and contribute to economic progress. Finally, destination countries can facilitate the process through policies that promote circulation of highly skilled migrants.     

The measurement of success in achieving the Millennium Development Goals

A new class of multidimensional indices is axiomatically characterized to assess countries’ overall success in achieving the Millennium Development Goals (MDGs). For that purpose we distinguish between the notions of progress and success functions. While the former basically measure changes between two points in time, the later essentially check whether these changes have been large enough to reach a prespecified target. These indices overcome some of the shortcomings of other conceptually related measures that have been proposed in the literature. Using data from the UN Statistical Office for the new indices, our results suggest that: i) On average, countries have only bridged about 23 % of the gap towards complete achievement of the MDGs, and ii) The best performing countries have only bridged around 40 % of that gap. The observed evolution has been relatively small and highly uneven across countries and dimensions, therefore posing an important challenge for international development agencies and national governments who aim to promote progress in the different MDGs.     

Computerizing the welfare state

Although computer technology is central to the operation of the modern welfare state, there has been little analysis of its role or of the factors shaping the way in which it is used. Using data generated by expert informants from 13 OECD countries, this paper provides an indicative comparison of the aims of computerization in national social security systems over a 15-year period from 1985 to 2000. The paper seeks to identify and explain patterns in the data and outlines and examines four hypotheses. Building on social constructivist accounts of technology, the first three hypotheses attribute variations in the aims of computerization to different welfare state regimes, forms of capitalism, and structures of public administration. The fourth hypothesis, which plays down the importance of social factors, assumes that computerization is adopted as a means of improving operational efficiency and generating expenditure savings. The findings suggest that, in all 13 countries, computerization was adopted in the expectation that it would lead to increased productivity and higher standards of performance, thus providing most support for the fourth hypothesis. However, variations between countries suggest that the sociopolitical values associated with different welfare state regimes have also had some effect in shaping the ways in which computer technology has been used in national social security systems.     

Parental substance abuse and the development of children in family foster care

To determine the impact of parental substance abuse on children, the cognitive skills and behavior ratings of 268 school-age children placed in family foster care were examined. As a group, the children in family foster care presented with low average cognitive skills and made significant improvement in cognitive functioning during placement. The children with prenatal exposure to drugs scored significantly lower in cognitive skills at the beginning of placement but made significantly more progress than the other children during placement. Behavior ratings by the foster parents and teachers revealed that 29% of the children had scores in the significant range, and the children exposed prenatally to drugs had a higher incidence of behavior problems at school compared to family foster care peers. Recommendations for further study of these factors and for enhancing outcomes for children in care are provided.     

Economic Transition and Regional Growth: The Case of Albania and Comparator SEECs

The focus of this paper is to investigate the growth performance of Albania and other South Eastern European Countries in the period 1990–2006 by examining traditional growth sources as emerge from standard theoretical models. It focuses on macroeconomic performances and GDP per capita growth rates to examine why countries in the SEE region are lagging behind with respect to other transition economies. The analysis is conducted through stylised growth regressions to estimate convergence rates and coefficients of key factors of growth. Results indicate that real GDP growth in all the eight countries is mainly driven by physical capital accumulation, whereas the contribution of human capital is insignificant or even negative.     

A unified Europe? How euro-attitudes relate to psychological differences between countries

In this study, a number of psychological concepts have been measured (through questionnaire-items) in 15 countries under the hypothesis that they could explain national differences in attitudes towards the euro. Based on the average country scores for each of these concepts, multidimensional scaling (combined with hierarchical cluster analysis) revealed 5 regions and 2 unclustered countries (UK and Ireland) in three dimensions: 1. National economic pride and satisfaction; 2. Self-confident open-mindedness; 3. Progressive non-nationalistic. Structural equation modelling was further used to perform multiple group regression analyses in order to test for differential relationships between the psychological concepts and the attitudes, for the different country regions. It could be shown that the majority of psychological variables have a significantly different impact on euro-attitudes.PsycINFO classification: 2229; 2930; 2960; 3920