Article

 

Poverty in Transition Countries (p.11-35)

by

Dirk J Bezemer, University of Groningen

Keywords : poverty, transition, vulnerable groups, coping mechanisms

JEL classification : O18, P36

Abstract

This paper examines poverty in transition countries in Central and Eastern Europe, the Balkan and former Soviet Union. The outcome of this research emphasized that unemployment, inflation and state desertion generally increased people's vulnerability to poverty, with large regional fluctuations. Poverty is associated with insufficient food and clothing, poor housing, limited access to utilities, poorer health and less access to healthcare, social exclusion, and psychological suffering. Coping strategies include household food production, resource pooling, multiple job holding, migration, dietary and other consumption changes, as well as household disintegration, alcoholism and suicide. Especially vulnerable to poverty are households in remote rural areas, most ethnic minorities, children, women, and single elderly people. Selected studies from Russia and Hungary indicate that there also is a “core” of long-term poor.

 

 

Measuring Banking Productivity of the Most Recent European Union Member Countries: A Non-Parametric Approach (p.37-57)

by

Dimitrios Angelidis, University of Macedonia, Dept. of Accounting and Finance (Greece)

Katerina Lyroudi, University of Macedonia, Dept. of Accounting and Finance (Greece)

Keywords : Banking efficiency, Data Envelopment Analysis, Transitional Economies

JEL classification : G21, C49, P29

Abstract

This paper evaluates the effectiveness of financial institutions in terms of productivity change of the ten latest members of the European Union for the period before their entry in the EU, 1996-2002. The non-parametric technique called Data Envelopment Analysis (DEA) is employed to calculate the Malmquist productivity index. Then the Malmquist index is decomposed into technological change and technical efficiency change index to determine the exact source of efficiency. The relationship between the size of financial institutions and productivity is also examined. The results indicated that the total level of productivity had increased for half of the countries during the six-year period. The decomposition of the Malmquist index revealed that the productivity increase was lower for the best practice Decision Making Units (DMUs) than the remaining institutions. Finally, the relationship between the size of banking institutions and productivity growth was not statistically significant, with the exception of Latvia, where this relationship was positive and significant.

 

 

Destructive Power, Enforcement and Institutional Change (p.59-89)

by

Mehrdad Vahabi, University of Paris 8

Keywords : Destructive power, creative power, screams, institutional change, enforcement

JEL classification : B52

Abstract

Institutions are usually defined as rules of the game. But if rules are dead letters without being enforced, then what is the role of destructive power in the genesis of institutions? This is the first question which will be addressed in the present paper. While the importance of incremental or evolutionary changes in informal rules is undeniable, what is the role of destructive power or revolution in politics with regard to institutional change? To what extent is destructive power involved in the change of rules? This is the second question that will be tackled in the present paper. The purpose of this paper is to answer these two questions focusing on a point that current scholarship regarding institutions usually fail to notice, with an emphasis on rules and laws: the power that enforces those rules and laws. The analysis of different forms of power will demonstrate the fact that the capacity to destroy as well as the capacity to produce plays a role in generating and maintaining institutions. I will try to show that the recognition of destructive power sheds new light on at least three major issues: i) the relationship between property rights and sovereignty, ii) the importance of revolution as well as evolution in social change, iii) the emergence of various means of collective expression such as Luddism, universal suffrage, and association.

 

 

Exchange Rates and Non-Linear Dynamics in Output: Evidence from Bulgaria (p.91-115)

by

Ilir Miteza, Department of Social Sciences, University of Michigan-Dearborn

Keywords : Exchange rates, devaluation, output growth, smooth transition regression, transition economies, Bulgaria, EU accession

JEL classification : F31

Abstract

This paper assesses the effect of changes in real exchange rates on output growth by applying a smooth transition regression (STR) model in the case of Bulgaria – a European Union accession country. The nonlinear estimation technique employed here offers more flexibility in terms of allowing for possible asymmetric effects of real appreciations on growth, contingent upon the behavior of relevant economic variables. The nonlinear model reveals that real appreciations have helped growth in Bulgaria for most of the period 1994-2004. Real appreciations can turn contractionary only under excessive real money growth, which has occurred only sporadically.

 

 

Research report: Transition in Central-European RTDI systems - RECORD (Recognising Central and Eastern European Centres of RTD) project, EC STRATA support scheme (p.117-134)

by

Borsi Balázs, Research manager, GKI Economic Research Co.

Papanek Gábor, Eszterházy K. College, executive director, GKI Co