Investment (FDI) Policy for Azerbaijan, Final report
Jutta Günther, Björn Jindra
Einzelveröffentlichungen,
No. 4,
2009
Abstract
The report has been prepared on behalf of the Association for Technical Cooperation (GTZ) as integral part of the “Private Sector Development Program” run by the GTZ in Azerbaijan. A comprehensive investment policy is outlined with particular focus on the possibilities to attract foreign direct investment (FDI) in Azerbaijan’s manufacturing industry (non-oil sector). The report makes particular reference to the experiences with investment policy development in Central and East European transition economies. It touches legal and institutional framework conditions in Azerbaijan as well as possible investment incentives schemes including investment promotion. Major recommendations refer to trade integration within the region, introduction of tax incentives as well as further improvements in business climate. Furthermore, the importance of complementary policies, such as competition and education policy, is stressed.
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Subsidiary Roles, Vertical Linkages and Economic Development: Lessons from Transition Economies
Björn Jindra, Axèle Giroud, J. Scott-Kennel
Journal of World Business,
2009
Abstract
Vertical supply chain linkages between foreign subsidiaries and domestic ?rms are important mechanisms for knowledge spillovers, contributing to the economic development of host economies. This paper argues that subsidiary roles and technological competences affect the extent of vertical linkages as such as well as their potential for technological spillovers. Using survey evidence from 424 foreign subsidiaries based in transition economies, we tested for the effect of subsidiaries’ autonomy, initiative, technological capability, internal and external technological embeddedness on the extent and intensity of forward and backward vertical linkages. The evidence supports our main argument that the potential of technology diffusion via vertical linkages depends on the nature of subsidiary roles. We discuss the implications for transition as well as other developing countries.
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A Professor Like Me: The Influence of Instructor Gender on College Achievement
Florian Hoffmann, Philip Oreopoulos
Journal of Human Resources,
No. 2,
2009
Abstract
Many wonder whether teacher gender plays an important role in higher education by influencing student achievement and subject interest. The data used in this paper help identify average effects from male and female college students assigned to male or female teachers. We find instructor gender plays only a minor role in determining college student achievement. Nevertheless, the small effects provide evidence that gender role models matter to some college students. A same-sex instructor increases average grade performance by at most 5 percent of its standard deviation and decreases the likelihood of dropping a class by 1.2 percentage points.
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Professor Qualities and Student Achievement
Florian Hoffmann, Philip Oreopoulos
Review of Economics and Statistics,
No. 1,
2009
Abstract
This paper analyzes the importance of teacher quality at the college level. Instructors are matched to objective and subjective characteristics of teacher quality to estimate the impact of rank, salary, and perceived effectiveness on student performance and subject interest. Student and course fixed effects, time of day and week controls, and students' lack of knowledge about first-year instructors help minimize selection biases. Subjective teacher evaluations perform well in measuring instructor influences on students, while objective characteristics such as rank and salary do not. Overall, the importance of college instructor differences is small, but important outliers exist.
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A Lesson Learned? Pre- and Post-Crisis Entry Decisions in Turkish Banking
H. Evren Damar
Contemporary Economic Policy,
No. 1,
2009
Abstract
This study looks at the determinants of entry by Turkish banks into local markets during the periods before and after the crisis of 2000–2001. Motivated by a theoretical model of entry, results of fixed-effects logit regressions suggest that there has been a change in the geographical diversification strategies of Turkish banks. It appears that the dominance of strategic concerns, such as competing with banks of similar size, has diminished, while economic concerns, such as incumbent characteristics and cost considerations, have become more important. Overall, the postcrisis restructuring policies seem to have led to improved decision making in the sector.
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Contestability, Technology and Banking
S. Corvoisier, Reint E. Gropp
ZEW Discussion Papers, No. 09-007,
No. 7,
2009
Abstract
We estimate the effect of internet penetration on retail bank margins in the euro area. Based on an adapted Baumol [1982] type contestability model, we argue that the internet has reduced sunk costs and therefore increased contestability in retail banking. We test this conjecture by estimating the model using semi-aggregated data for a panel of euro area countries. We utilise time series and cross-sectional variation in internet penetration. We find support for an increase in contestability in deposit markets, and no effect for loan markets. The paper suggests that for time and savings deposits, the presence of brick and mortar bank branches may no longer be of first order importance for the assessment of the competitive structure of the market.
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Growth, Volatility, and Credit Market Imperfections: Evidence from German Firms
Claudia M. Buch, Jörg Döpke
Journal of Economic Studies,
2008
Abstract
Purpose – The purpose of this paper is two-fold. First, it studies whether output volatility and growth are linked at the firm-level, using data for German firms. Second, it explores whether the link between volatility and growth depends on the degree of credit market imperfections.
Design/methodology/approach – The authors use a novel firm-level dataset provided by the Deutsche Bundesbank, the so-called Financial Statements Data Pool. The dataset has time series observations for German firms for the period 1997-2004, and the authors use information on the debt-to-assets or leverage ratio of firms to proxy for credit-constraints at the firm-level. As additional proxies for the importance of credit market imperfections, we use information on the size and on the legal status of firms.
Findings – The authors find that higher volatility has a negative impact on growth for small and a positive impact for larger firms. Higher leverage is associated with higher growth. At the same time, there is heterogeneity in the determinants of growth across firms from different sectors and across firms with a different legal status.
Practical implications – While most traditional macroeconomic models assume that growth and volatility are uncorrelated, a number of microeconomic models suggest that the two may be linked. However, it is unclear whether the link is positive or negative. The paper presents additional evidence regarding this question. Moreover, understanding whether credit market conditions affect the link between volatility and growth is of importance for policy makers since it suggests a channel through which the credit market can have long-run welfare implications. The results stress the importance of firm-level heterogeneity for the effects and effectiveness of economic policy measures.
Originality/value – The paper has two main novel features. First, it uses a novel firm-level dataset to analyze the determinants of firm-level growth. Second, it analyzes the growth-volatility nexus using firm-level data. To the best of the authors' knowledge, this is the first paper, which addresses the link between volatility, growth, and credit market imperfections using firm-level data.
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Are European Equity Style Indices Efficient? – An Empirical Quest in Three Essays
Marian Berneburg
Schriften des IWH,
No. 28,
2008
Abstract
Many situations in the history of the stock markets indicate that assets are not always efficiently priced. But why does it matter whether the stock market is efficiently priced? Because “well-functioning financial markets are a key factor to high economic growth”. (Mishkin and Eakins, 2006, pp. 3-4) In three essays, it is the aim of the author to shed some more light on the topic of market efficiency, which is far from being resolved. Since European equity markets have increased in importance globally, the author, instead of focusing on US markets, looks at a unified European equity market. By testing for a random walk in equity prices, revisiting Shiller’s claim of excess volatility through the means of a vector error correction model, and modifying the Gordon-Growth-Model, the book concludes that a small degree of inefficiency cannot be ruled out. While usually European equity markets are pricing assets correctly, some periods (e.g. the late 1990s and early 2000s) show clear signs of mispricing; the hypothesis of a world with two states (regime one, a normal efficient state, and regime two, a state in which markets are more momentum driven) presents a possible explanation.
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Getting out of the ivory tower – New perspectives on the entrepreneurial university
Jutta Günther, Kerstin Wagner
European Journal of International Management,
2008
Abstract
Based on theoretical considerations about the ‘third mission’ of
universities and the discussion of different types of university-industry relations, we conclude that the entrepreneurial university is a manifold institution with direct
mechanisms to support the transfer of technology from academia to industry
as well as indirect mechanisms in support of new business activities via
entrepreneurship education. While existing literature usually deals with one or
another linking mechanism separately, our central hypothesis is that direct and
indirect mechanisms should be interrelated and mutually complementary. We
emphasise the importance of a more holistic view of the entrepreneurial university
and empirically investigate the scope and interrelatedness of direct technology
transfer mechanisms and indirect mechanisms, such as entrepreneurship education
at German universities. We find a variety of activities in both fields and most
universities’ technology transfer facilities and the providers of entrepreneurship
education co-operate in support of innovative start-ups.
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Exchange Rates and FDI: Goods versus Capital Market Frictions
Claudia M. Buch, J. Kleinert
World Economy,
forthcoming
Abstract
Changes in exchange rates affect countries through their impact on cross-border activities such as trade and foreign direct investment (FDI). With increasing activities of multinational firms, the FDI channel is likely to gain in importance. Economic theory provides two main explanations why changes in exchange rates can affect FDI. According to the first explanation, FDI reacts to exchange rate changes if there are information frictions on capital markets and if investment depends on firms’ net worth (capital market friction hypothesis). According to the second explanation, FDI reacts to exchange rate changes if output and factor markets are segmented, and if firm-specific assets are important (goods market friction hypothesis). We provide a unified theoretical framework of these two explanations. We analyse the implications of the model empirically using a dataset based on detailed German firm-level data. We find greater support for the goods market than for the capital market friction hypothesis.
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