infonet-economy

This paper documents the novel fact that Regional Trade Agreements (RTA) decrease bilateral trade imbalances as measured by conventional measure of the net export share in gross trade. While on average an RTA decreases bilateral trade imbalance by 7%, greater trade integration through a deeper RTA is associated with a reduction of up to 50% among the sample of over 160 countries…

This study aims to analyse the discretionary fiscal policy of Azerbaijan, Kazakhstan, and Russia for the period 2003-2015 using the structural budget balance (SBB). The SBB considers the permanent component of oil revenue and therefore clearly defines the discretionary fiscal position and the aggregate demand effect of fiscal policy. The SBBs in Azerbaijan and Russia experience a…

We propose a novel theoretical framework to study how environmental regulation shapes economic development in a developing country such as China. We develop a dynamic tax competition model in which local governments, located in development zones, use variation in taxes to attract workers to their jurisdictions. Their objective is to maximize tax revenue less local health costs that…

This note starts with a short review of the economic literature on philanthropy. Next, it provides some estimates of philanthropic giving in advanced and middle-income economies and discusses how innovative financial instruments can leverage charitable giving. The note concludes with a discussion of the controversial aspects of philanthropic activities.

Identity is an important determinant of economic behavior. A limitation of the existing literature is the focus on one identity dimension at a time. We show that the multiplicity of identity dimensions matters for economic behavior and that neglecting it may lead policy makers to overlook important, unintended effects of economic policies. We exploit the randomized nature of…

The impact of institutional quality on the exchange rate-export relation is assessed in a panel of 33 countries and quarterly time period of 1991Q1 - 2016Q3. Empirical estimation is conducted in 2 steps. As a first step, using panel DOLS, FMOLS and PMG estimation techniques, it is confirmed that a negative and significant relation between exchange rates and exports exists. The…

While microfinance institutions (MFIs) are increasingly important as employers in the developing world, there is little micro-level evidence on gender differences among MFI employees and MFIs' relation to economic development. We use a unique panel dataset of employees from Latin America's largest MFI to show that gender gaps favouring men for promotion exist primarily in…

This paper presents a novel dynamic factor model for non-stationary data. We begin by constructing a simple dynamic stochastic general equi- librium growth model and show that we can represent and estimate the model using a simple linear-Gaussian (Kalman) filter. Crucially, consistent estimation does not require differencing the data despite it being cointe- grated of order 1. We…

The aim of this research is to identify the determinants of excess liquidity defined as excess reserves in the banking sector in Bosnia and Herzegovina (B&H). The empirical analysis is carried out through the use of the dynamic panel analysis based on the generalized method of moments (GMM) methodology on a dataset of 19 commercial banks operating in B&H in the period from…