The Russian System of Cities from the Perspective of New Economic Geography
Albrecht Kauffmann
Potsdamer Schriften zur Raumwirtschaft, Bd. 2,
2010
Abstract
The rise in energy prices may result in long-lasting rise in costs of freight transports. Which effects do rising freight transport costs have for the development of urban systems? Such rise of transport costs in real terms has happened in Russia after price liberalisation in 1992. At the same time, the Russian official demographic statistics provides data that can be used to test hypotheses concerning the development of urban systems affected by rising transport costs. In the present study, these data are comprehensively evaluated. The theoretical background is provided by modelling of a linear shaped urban system in the framework of New Economic Geography. By means of this tool, analysis can be applied to spacious urban systems with large transport distances. For the first time, the underlying theoretical approach is explained in detail. The empirical results provide evidence for the outcomes of the theoretical model: In spacious countries or regions, respectively, whose urban systems are drawn-out on long lines, rising costs of freight transport are conducive to tendencies of concentration of population in large cities in the centre of the system, while peripheral regions are increasingly disconnected.
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Worker Remittances and Capital Flows to Developing Countries
Claudia M. Buch, A. Kuckulenz
International Migration,
No. 5,
2010
Abstract
Worker remittances constitute an increasingly important channel for the
transfer of resources to developing countries. Behind foreign direct investment,
remittances are the second-largest source of external funding for developing countries. Yet, literature on worker remittances has traditionally focused on the impact of remittances on income distribution within countries, on the determinants of remittances at a micro-level, or on the effects of migration and remittances for specific countries or regions. Macroeconomic determinants and effects of remittances have received more attention only recently. Hence, the focus of this paper is on the macroeconomic determinants of remittances and on differences in these determinants between remittances and other capital flows. We find that
remittances respond more to demographic variables while private capital
flows respond more to macroeconomic conditions.
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German Economy Recovers Surprisingly Quickly from Last Year’s Recession
Wirtschaft im Wandel,
No. 9,
2010
Abstract
The German economy recovers surprisingly quickly from last year’s recession. For this year, we expect GDP to grow by 3.5%. Next year, when GDP growth should reach a rate of 2%, the general government deficit is likely to fall below the 3% mark of the Stability and Growth pact – if the government indeed realizes the stabilization program it decided on this summer. Unemployment will continue to decline.
We see three main causes for this favorable development: first, the German economy benefits strongly from the high growth dynamics in emerging markets, since German firms are well positioned for producing investment goods that are particularly sought-after in these countries. Second, growing demand for labor in Germany means that employment and labor income is on the rise. Partly, this is the reward for a long time of low wage rises that have made labor in Germany competitive again. Third, the expansive monetary policy in the euro area is particularly stimulating since here debt levels of private households and firms are moderate and therefore do not dampen the stimulating effects of low interest rates, as they do in many euro area partner countries with highly indebted private and public agents.
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Do Banks Benefit from Internationalization? Revisiting the Market Power-Risk Nexus
Claudia M. Buch, C. T. Koch, Michael Koetter
Abstract
Recent developments on international financial markets have called the benefits of
bank globalization into question. Large, internationally active banks have
acquired substantial market power, and international activities have not
necessarily made banks less risky. Yet, surprisingly little is known about the
actual link between bank internationalization, bank risk, and market power.
Analyzing this link is the purpose of this paper. We jointly estimate the
determinants of risk and market power of banks, and we analyze the effects of
changes in terms of the number of foreign countries (the extensive margin) and
the volume of foreign assets (the intensive margin). Our paper has four main
findings. First, there is a strong negative feedback effect between risk and market
power. Second, banks with higher shares of foreign assets, in particular those held
through foreign branches, have higher market power at home. Third, holding
assets in a large number of foreign countries tends to increase bank risk. Fourth,
the impact of internationalization differs across banks from different banking
groups and of different size.
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Liberalization and Rules on Regulation in the Field of Financial Services in Bilateral Trade and Regional Integration Agreements
Diemo Dietrich, J. Finke, C. Tietje
Beiträge zum Transnationalen Wirtschaftsrecht Nr. 97,
2010
Abstract
The recent international financial crisis has sparked a fierce debate about its causes and about how to prevent a recurrence. As liberalization and deregulation were widely considered being among the major culprits, de-liberalization and re-regulation seemed a natural response. However, an economic approach to this issue does not support such black-and-white solutions. Although liberalizing financial services sectors may threaten a developing country's financial stability in the short run, it also fosters long-run economic growth if sound legal and economic institutions are in place that can mitigate the adverse side-effects of liberalization. For achieving this objective, states need the policy space to implement such regulatory measures. Contrary to a wide-spread belief, states are not unduly hampered by bilateral or multilateral agreements. Instead, by providing a far-reaching exception concerning prudential regulation states can define their own regulatory approach. The challange for developing countries thus is to install regulatory capacities.
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The Impact of Bank and Non-bank Financial Institutions on Local Economic Growth in China
Xiaoqiang Cheng, Hans Degryse
Journal of Financial Services Research,
No. 2,
2010
Abstract
This paper provides evidence on the relationship between finance and growth in a fast growing country, such as China. Employing data of 27 Chinese provinces over the period 1995–2003, we study whether the financial development of two different types of financial institutions — banks and non-banks — have a (significantly different) impact on local economic growth. Our findings indicate that banking development shows a statistically significant and economically more pronounced impact on local economic growth.
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The Emergence of Wage Coordination in the Central Western European Metal Sector and its Relationship to European Economic Policy
Vera Glassner, Toralf Pusch
Abstract
In the European Monetary Union the transnational coordination of collective wage bargaining has acquired increased importance on the trade union agenda. The metal sector has been at the forefront of these developments. This paper addresses the issue of crossborder coordination of wage setting in the metal sector in the central western European region, that is, in Germany, the Netherlands and Belgium, where coordination practices have become firmly established in comparison to other sectors. When testing the interaction of wage developments in the metal sector of these three countries, relevant macroeconomic (inflation and labour productivity) and sector-related variables (employment, export-dependence) are considered with reference to the wage policy guidelines of the European Commission and the European Metalworkers’ Federation. Empirical evidence can be found for a wage coordination effect in the form of increasing compliance with the wage policy guidelines of the European Metalworkers’ Federation. The evidence for compliance with the stability-oriented wage guideline of the European Commission is weaker.
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International Bank Portfolios: Short- and Long-Run Responses to Macroeconomic Conditions
S. Blank, Claudia M. Buch
Review of International Economics,
No. 2,
2010
Abstract
International bank portfolios constitute a large component of international country portfolios. Yet, banks’ response to international macroeconomic conditions remains largely unexplored.We use a novel dataset on banks’ international portfolios to answer three questions. First, what are the long-run determinants of banks’ international portfolios? Second, how do banks’ international portfolios adjust to short-run macroeconomic developments? Third, does the speed of adjustment change with the degree of financial integration?We find that, in the long-run, market size has a positive impact on foreign assets and liabilities. An increase in the interest differential between the home and the foreign economy lowers foreign assets and increases foreign liabilities. Foreign trade has a positive impact on international bank portfolios, which is independent from the effect of other macroeconomic variables. Short-run dynamics show heterogeneity across countries, but these dynamics can partly be explained with gravity-type variables.
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Im Fokus: Polen in der globalen Finanz- und Konjunkturkrise – Realwirtschaft trotzt mit IWF-Unterstützung den Finanzmarktturbulenzen
Tobias Knedlik
Wirtschaft im Wandel,
No. 4,
2010
Abstract
Poland’s economy resists turbulences on financial markets
Poland has been affected by the global financial crisis. However, developments in Poland deviated considerably from developments in other middle and eastern European countries. Risk premiums, as measured by credit default swaps, increased by less but more suddenly as compared with other countries of the region. The Polish currency crisis started earlier and lasted longer as in other countries of the region. The developments on financial markets did, however, not result in a recession.
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