Emerald | Journal of Economic Studies | Table of Contents http://www.emeraldinsight.com/0144-3585.htm Table of contents from the most recently published issue of Journal of Economic Studies Journal en-gb Tue, 02 Sep 2014 00:00:00 +0100 2013 Emerald Group Publishing Limited editorial@emeraldinsight.com support@emeraldinsight.com 60 Emerald | Journal of Economic Studies | Table of Contents http://www.emeraldinsight.com/common_assets/img/covers_journal/jescover.gif http://www.emeraldinsight.com/0144-3585.htm 120 157 Sensitivity Analysis in an Imperfect Substitutes Model of Preferential Trade http://www.emeraldinsight.com/journals.htm?issn=0144-3585&volume=41&issue=5&articleid=17115069&show=abstract <strong>Abstract</strong><br /><br /><B>Purpose</B> - To develop a formal representation of the imperfect substitutes model (ISM) of partial equilibrium, trade policy analysis and to conduct sensitivity analysis on the behavioral parameters of the model.<B>Design/methodology/approach</B> - The paper develops an imperfect substitutes model in a manner that is conformable to more complex, applied general equilibrium models of trade policy analysis.<B>Findings</B> - The paper presents a set of sensitivity analyses on key behavioral parameters for a better understanding of the model’s properties. <B>Research limitations/implications</B> - Sensitivity analysis on the values of behavioral parameters in imperfect substitutes models needs to be conducted by trade policy modelers.<B>Practical implications</B> - The imperfect substitutes model is made more explicit here than in most representations, something that will be of great use to practitioners. <B>Originality/value</B> - While widely used in trade policy circles, the imperfect substitutes model is rarely explicitly formulated, nor the role of its behavioral parameters explored. Article literatinetwork@emeraldinsight.com (Kenneth Reinert) Tue, 02 Sep 2014 00:00:00 +0100 Does Structural Economic Vulnerability Matter for Public Indebtedness in Developing Countries? http://www.emeraldinsight.com/journals.htm?issn=0144-3585&volume=41&issue=5&articleid=17115071&show=abstract <strong>Abstract</strong><br /><br /><B>Purpose</B> - The purpose of this paper is to examine the effect of structural economic vulnerability of developing countries on their public indebtedness. <B>Design/methodology/approach</B> - We perform our analysis by the use of fixed effects technique where the standard errors are corrected by the Driscoll-Kraay (1998) method. Our panel covers 96 developing countries over the period 1980-2008. <B>Findings</B> - The results suggest evidence of a "U-shaped" relationship between the structural vulnerability and the total public debt in developing countries. More particularly in Low-Income Countries (LICs), the structural vulnerability appears to be a strong determinant of the build-up of the total public debt. <B>Research limitations/implications</B> - It would be interesting to extend the research to Small Island Developing States (SIDS). Indeed, we do not include this group of countries because of lack of data, especially on the variable "quality of governance" for almost all countries of this group. Accordingly, the research should be extended to such countries as well as these data are available.<B>Practical implications</B> - The implications of our study is that International Institutions, including those of the Bretton Woods should take into account the structural vulnerability of developing countries when designing development policies, especially the ones related to debt sustainability in developing countries and particularly LICs.<B>Originality/value</B> - The added value of this paper is to use recent data on structural vulnerability to analyse the effect of the latter on public indebtdeness of developing countries. Article literatinetwork@emeraldinsight.com (Sena Kimm Gnangnon) Tue, 02 Sep 2014 00:00:00 +0100 Which Firms Export? An Empirical Analysis for the Manufacturing Sector in the MENA Region http://www.emeraldinsight.com/journals.htm?issn=0144-3585&volume=41&issue=5&articleid=17115060&show=abstract <strong>Abstract</strong><br /><br /><B>Purpose</B> - This paper analyzes the export behaviour of manufacturing firms located in the Middle East and North Africa (MENA) region using data from the World Bank’s Enterprise Surveys Database. <B>Design/methodology/approach</B> - This paper examines the factors influencing the export behaviour of manufacturing firms located in the MENA region through a probit model for export decision and through a fractional logit model for export intensity. <B>Findings</B> - The empirical results show significant positive effects of private foreign ownership, information and communication technology, and firm size on the probability of exporting and on export intensity of MENA manufacturing firms. Government ownership tends to exert negative effects on firms’ propensity to export. The results underscore enhancing effects of national economic development levels on firms’ export performance. Also, they indicate that firms’ propensity to export decreases with larger domestic market size. The empirical analysis reveals considerable heterogeneity in the implications of firm characteristics for firms’ export behaviour through firm size categories and across MENA countries. <B>Originality/value</B> - This paper contributes to the literature by conducting overall and comparative cross-country empirical analyses of the factors influencing the export behaviour of manufacturing firms located in the MENA region. It also explores the specificities of small and large firms’ responses to the factors influencing firms’ export behaviour. The results have implications for policies intended to enhance industrial growth and international competitiveness of the manufacturing sector in the MENA region. Article literatinetwork@emeraldinsight.com (Ali Fakih, Pascal L. Ghazalian) Tue, 02 Sep 2014 00:00:00 +0100 Recent trends in factor income shares: a global perspective http://www.emeraldinsight.com/journals.htm?issn=0144-3585&volume=41&issue=5&articleid=17115044&show=abstract <strong>Abstract</strong><br /><br /><B>Purpose</B> - The purpose of this paper is to provide estimates of factor income shares for 79 developed, developing, and transition economies representing close to 90% of the world output and to test for income share convergence. <B>Design/methodology/approach</B> - The paper uses data from the United Nations National Accounts and World Bank World Development Indicator databases and the factor-income-share estimation methodology developed in Bernanke and Gurkaynak (2001) and Gollin (2002).<B>Findings</B> - Our estimates indicate that the average levels of capital income (profit) shares in developing and transition countries are 1.4-1.5 times higher than in developed economies. During the period studied, profit shares in all groups of countries trended upwards. As a result, the "global" profit share increased thus extending the "labor share squeeze" of the 1980s and 1990s.<B>Practical implications</B> - The finding of persistent and significant differences in factor shares in countries of different development levels calls into question the assumption of uniform factor shares’ often made in studies of economic growth. The detection of a broadly-based upward trend in profit shares has implications for studies of income distribution and inequality. <B>Originality/value</B> - The paper’s contribution is in providing updated estimates of factor income shares for the broad sample of countries, including in particular transition economies, not covered in previous studies; confirming the positive link between profit share and country’s income level; countering claims of factor income convergence and establishing the upward trend in "global" profit share. Article literatinetwork@emeraldinsight.com (Alexei Izyumov, John Vahaly) Tue, 02 Sep 2014 00:00:00 +0100 Time-inconsistency Problem: Less Common than We Think http://www.emeraldinsight.com/journals.htm?issn=0144-3585&volume=41&issue=5&articleid=17115054&show=abstract <strong>Abstract</strong><br /><br /><B>Purpose</B> - This paper makes an empirical analysis concerning time-inconsistency problem (TIP) based on a sample of 12 countries for the period from 1993 to 2011.<B>Design/methodology/approach</B> - The existence of TIP only makes sense if there is a trade-off between inflation and unemployment and when there is a causal relationship indicating that with more inflation, unemployment is reduced (as suggested by the Phillips curve). Hence, TIP is observed by testing the existence of cointegration between inflation rate and unemployment rate series and analyzing the sign of the estimated coefficient of the cointegration vector. <B>Findings</B> - The findings indicate that the large majority of countries in the sample have policies that are consistent with long-term goals. Furthermore it is possible to conjecture that the traditional argument that developing countries have weak institutions and thus present a fertile ground for TIP or that the adoption of IT can avoid TIP is not necessarily true.<B>Originality/value</B> - This study sheds light on four important issues: (i) Has the change in the mindset of the monetary policy management from the 1990s eliminated TIP? (ii) Is TIP a sickness only for developing countries? (iii) Is inflation targeting (IT) associated with TIP? (iv) Has the TIP increased around the world due to the subprime crisis? In short, this paper is an advance on the empirical literature on TIP and it is a very important overview for observing the present day conduct of the monetary policy through the international experience. Article literatinetwork@emeraldinsight.com (Julio Bastos, Helder Ferreira de Mendonça, Gabriel Montes) Tue, 02 Sep 2014 00:00:00 +0100 Firing Tax vs. Severance Payments - An Unequal Comparison http://www.emeraldinsight.com/journals.htm?issn=0144-3585&volume=41&issue=5&articleid=17115037&show=abstract <strong>Abstract</strong><br /><br /><B>Purpose</B> - This paper compares two elements of lay-off costs in a dynamic model of the labor market and analyzes the differences for business cycle dynamics and welfare.<B>Design/methodology/approach</B> - The paper builds a general equilibrium RBC model and introduces firing costs and severance payments. Labor market frictions are assumed to follow the famous search and matching approach.<B>Findings</B> - We ?find that ?firing costs imply a higher volatility over the cycle and have stronger negative welfare effects. Severance payments have a lower volatility, reduce unemployment, and reduce welfare by a smaler amount.<B>Practical implications</B> - Policy reforms should be aimed to use severance payments and reduce the ?ring cost component of lay-off costs.<B>Originality/value</B> - Increasing welfare and a more stable business cycle could be supported by using severance payments instead of firing costs. Article literatinetwork@emeraldinsight.com (Dennis Wesselbaum) Tue, 02 Sep 2014 00:00:00 +0100 Does Regional Currency Integration Ameliorate Global Macroeconomic Shocks In Sub-Saharan Africa? The Case of the 2008 - 2009 Global Financial Crisis http://www.emeraldinsight.com/journals.htm?issn=0144-3585&volume=41&issue=5&articleid=17115048&show=abstract <strong>Abstract</strong><br /><br /><B>Purpose</B> - This paper considers whether regional currency integration in sub-Saharan Africa ameliorates global macroeconomic shocks by considering the impact of the 2008 - 2009 global financial crisis on economic growth. This suggests that CFAZ eurocurrency union membership amplifies the effects of global business cycles in sub-Saharan Africa.<B>Design/methodology/approach</B> - We estimate the parameters of a quantity theory model of economic growth within a Generalized Estimating Equation Framework. <B>Findings</B> - Parameter estimates from Generalized Estimating Equation specifications reveal that the contraction in credit during the financial crisis of 2008 - 2009 had larger adverse growth effects on sub-Saharan African countries who were members of the CFAZ eurocurrency union We also find that sub-Saharan African countries who were members ofthe CFAZ eurocurrency union were more likely to experience a contraction in credit<B>Originality/value</B> - As far as we can discern, no existing empirical growth models use a Generalized Estimating Equation (GEE) framework to estimate parameters of interest. Our GEE parameter estimates are distribution-free, robust with respect to unknown forms of heteroskedasticity, and control for a wide variety of error structures that can induce bias in panel data parameter estimates. Article literatinetwork@emeraldinsight.com (Gregory N. Price, Juliet U Elu) Tue, 02 Sep 2014 00:00:00 +0100