Turkish Economic Review
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Globalization, political orientation and wage inequality: From Donald Trump’s election to Angela Merkal’s re-election
Get PDFAbstract. The recent election results in US, Germany, Japan and China and vote for BRIXIT in Britian suggest that political outcomes increasingly relate to the economic, political and social orientation in both developed and developing countries. Countries that have not promoted social and economic harmony in the country - democracy eventually puts the pressure through the discontent local polity resulting in election outcomes similar to US presidential elections in 2016. To avoid anti-globalization feelings among local population and its negative outcomes, improving political orientation towards greater participation of local polity and investments in education in developing countries would result in more equality. The research is applicable to countries like India, China, Pakistan, Argentina, Sub-Saharan Africa who have all liberalised but still need to draw lessons from East Asia for their Industrialisation and Growth Promotion with early emphasis on Social and Institutional Development. Keywords. Democracy, Autocracy, Wage inequality, International trade.JEL. E24, F40, J30
Corruption and health care provision: An extension of the Shleifer and Vishny’ Model
Get PDFAbstract. The problem that arises is how the State official in a monopoly situation maximizes the value of bribes collected, by selling public services to users? To answer this question, we show first that in the case of health care provision, the Shleifer and Vishny’ simple monopoly model which highlights two forms of corruption (with theft and without theft) is limited insofar as it underestimates not only the value of bribes likely to be collected, but also the loss of income that corrupt practices cause to public services. Our model rather reveals that the State agent in a monopoly situation can discriminate users according to their characteristics in order to collect more possible bribes. Indeed, our model shows that when a medical doctor maximizes its earnings and whatever the form of corruption practiced, he plays not only on amounts of bribes paid and a part of the official price, but also on users’ characteristics. However, for some amounts the State agent will tend to practice the form of corruption without theft on certain users’ characteristics where he/she would draw the greatest possible gain.Keywords. Corruption with and without theft, Discrimination at first degree, Lerner`s index, Profit-sharing scheme, Health system.JEL. D40, I10, I14, I15
Does new public management practices lead to effective public welfare responses in Pakistan
Get PDFAbstract. New Public Management is used to regulate government policies meant to enhance performance of public sector that ultimately facilitates general public interest and improve their living standards. New Public Management is inevitable as under this approach modern governments are inclined to bring reforms in an effort to improve efficiency and effectiveness of public sector by adopting private sector practices. Pakistan is also influenced by NPM as reforms in public sector have been developed and implemented to some extent with weak claims of improved performance. The lack of actual improvement in performance raises many questions on the effectiveness of NPM implementation in Pakistan. This study aims to explore these questions by measuring factors influencing performance of public sector organizations in Pakistan. This study adopted quantitative approach to conduct an empirical investigation. Research framework includes major factors of NPM based on literature. Data was collected using adopted questionnaires for each variable. Survey was done from a sample taken from public sectors enterprises in Punjab province under random sampling technique. Data was analyzed using various statistical techniques. Demographics were analyzed in the form of descriptive statistics. Research variables were analyzed using Multiple Regression analysis and Pearson Correlation analysis. Regression assumptions were tested which were fulfilled. Reliability and validity were also tested. Findings show that both “Democratization and Participation (Involvement in Decision Making)”; and “Customer Concept (Customer Orientation)” have positive influence on performance under NPM. Whereas interestingly “Decentralization (Delegation)” has negative influence on performance under NPM as a result of resistance of employees towards recent attempts of Devolution of power or authority. But surprisingly “Management Style (HR Practices)” show no influence on performance under NPM as a result of unresponsiveness of employees towards modern management related practices. Recommendations have been provided as general and specific strategies for effective implementation of NPM in order to enhance organizational performance under NPM.Keywords. Public management, Public welfare.JEL. D73, E60, H10
Is there a significant change in the price transmission between producer and retail prices within the British Pork industry?
Get PDFAbstract. The purpose of this study is to examine price transmission between the producer and retail in the UK pork industry. It aims to find the direction of causality in the long and short-run, and whether there is a long-run relationship between producer and retail prices. This study used monthly time series data for producer and retail prices ranging from 1988-2016. Econometric tests were used such as the Augmented Dickey-Fuller (1979) and Phillips-Perron (1988) Unit Root tests; Bai-Perron (1998) Unit Root test allowing for multiple structural breaks; Johansen (1991) and Engle-Granger (1987) Co-integration tests; Granger (1988) Causality, and the Error Correction Model showing the speed of recovery in the long-run after a shock. The results of the Unit Root tests found both producer and retail prices to be integrated of order one I(1). Three structural breaks were found occurring in the years of 1996, 2002 and 2012. The Co-integration tests found that there is one long-run relationship between producer and retail prices. The Error Correction Model showed the return to a new equilibrium after a shock was 9% per month totalling over 11 months for a full recovery from a shock. The Granger (1988) Causality test indicated that producer prices do Granger cause retail prices in the short-run. In this study the latest econometric techniques were used including structural breaks which some previous studies overlooked. This study into the producer and retail prices in the UK pork industry is the latest study of this kind since the Brexit decision.Keywords. Price transmission, Producer, Retail, Pork, Unit Root, Bai-Perron co-integration, Structural breaks, Error correction model, Causality, Brexit.JEL. L60, L70, L80
Moroccan tax potential: Econometric analysis through the tax effort
Get PDFAbstract. This paper aims to analyse the Moroccan tax potential compared to a sample of countries (panel), relying on the tax effort concept, wich allows isolating the part of the government public levying. It is an international study, using a panel data (25 countries-26 years). The result of econometrics estimations shows the positive effect of the GDP per capita, the openness degree of the economy, the monetization degree and the part of industrial Added Value on the public potential while the part of agricultural Added Value had a negative impact. Analyzing the tax effort, we find that Morocco had a negative effort between 1990 and 2004. But, since 2005, the policies pursued after the reform helped reverse the trend to achieve a positive effort. It means that Morocco exploits all his fiscal resources from the standard of the sample.Keywords. Tax burden, Tax potential, Tax effort, Structural factors, Panel.JEL. E62, G28, H21, C50
An empirical analysis of the impact of floating exchange rate on balance of payment in Nigeria (1986 - 2016)
Get PDFAbstract. This paper empirically investigates the impact of floating exchange rate on balance of payment in Nigeria during 1986 – 2016. Unit root test, cointegration test, VEC Granger causality/Exogeneity Wald test and Vector Error Correction Model (VECM) were econometric tools used to establish the relationship between exchange rate and balance of payment. The results showed a positive and statistically significant relationship in both short-run and long-run between balance of payment and exchange rate of the Nigerian Economy during the period under review. The VEC Granger Causality/Block Exogeneity further revealed that the major determinants of exchange rate are real GDP and money supply. It further reveals that the nexus among the variables runs from government expenditure to real GDP and money supply to exchange rate, and then to Balance of Payment. Therefore it was recommended amongst other things that the policy of exchange rate depreciation should be maintained but with government intervention guide. Government through Central Bank of Nigeria (CBN) should apply expenditure reducing monetary policies through money supply and domestic credit to promote favourable BOT which invariably stabilizes BOP.Keywords. Floating exchange rate, Balance of payments, VECM.JEL. F10, F30, F31
The impact of sudden stops in capital flows on output and investment: Selected emerging markets
Get PDFAbstract. We evaluate how vulnerable the emerging markets are to sudden stops, that is, capital inflow reversals, using panel data for 12 emerging economies for the period 1976-2002 that experienced such reversals. We investigate the impact of sudden stops on the macroeconomic indicators of economic growth and investment by employing the Generalized Method of Moments (GMM) estimation methodology. A robustness check is performed using regional groups and introducing additional control variables. We find that sudden stops have lagging, negative, and robust effect on output and investment, while the effect on investment is not always robusth.Keywords. Sudden stops, Economic growth, Capital flows, Emerging markets, GMM.JEL. E40, F32, F36, G15
Violent crime driven by income Inequality between countries
Get PDFAbstract. The literature has suggested several approaches to explain violent crime, such as the heat hypothesis that more violence is associated to very hot temperature. However, the manifold determinants of violent crime in society are hardly known. This study shows that, controlling the climate, the intentional homicides (per 100,000 people) can be explained by the high level of income inequality, both in hot tropical areas and in temperate regions of the globe. Overall, then, the socioeconomic inequality is one of factors that generates aversive social environments and, as a consequence, a deteriorated human behavior leading to high rates of intentional homicides in society. Keywords. Temperature, Inequality, Violent crime, Intentional homicides, Heat hypothesis.JEL. D63, I14, I24, N30, O44, O57
Measurement and assessment of the evolution of technology with a simple biological model
Get PDFAbstract. A simple model of the development of technology is presented. This model, in a broad analogy with evolutionary ecology of parasites, within a theoretical framework of Generalized Darwinism, can explain vital characteristics of technological advances and technological evolution. In particular, the evolution of technology is modelled here in terms of morphological changes between a host technology and a main subsystem of technology. The coefficient of evolutionary growth of this simple model here indicates the grade and type of the evolution of technology. This coefficient is quantified in real cases study using historical data of farm tractor, freight locomotive and electricity generation technology in steam-powered plants and internal-combustion plants. The approach of measurement and assessment of technological evolution proposed here seems to be appropriate in grasping the dynamics of technological evolution to predict which technologies are likeliest to evolve rapidly.Keywords. Measurement of technology, Technometrics, Technological evolution, Technological change, Technological forecasting, Technology assessment, Technological progress, Innovation, Technology studies, Public decision making.JEL. O30, O31, O32, O33, O38