List of issues

Contents of issue 11-12/2011

Michał Burzyński, Krzysztof Malaga - Neo-Schumpeterian Economic Growth Model Including the Capital Market, abstract, article

Dariusz Leśko - A Model of Firm Growth, abstract, article

Anna Sulima - The Stability of the Nonneman-Vanhoudt Model with the CES Production Function, abstract, article

Monika Fiedorczuk - The Role of Corporate Groups in Russia, abstract, article

Vitali Naumavets - The Development of Polish-Owned Companies on the Belarusian Market, abstract, article


Michael Woodford - Financial Intermediation and Macroeconomic Analysis, article


Anna Jarosz-Nojszewska - Józef Krzyczkowski and the Social National Club, abstract, article


Book Review: Mateusz Machaj (ed.), Pod prąd głównego nurtu ekonomii (Against Mainstream Economics), Instytut Ludwiga von Misesa, Warsaw 2010, 239 pp. - reviewed by Marek Lubiński

Book Review: Krzysztof Janasz, Kapitał w finansowaniu działalności innowacyjnej w Polsce. Żródła i modele (Financing Innovation in Poland: Sources and Models), Difin, Warsaw 2010, 280 pp. - reviewed by Wojciech Burzyński


Economic Liberalism and Transition - Wacław Jarmołowicz, Katarzyna Szarzec

Global Determinants of Regional Development - Tadeusz Smuga

Index of Publications in 2011

Michał Burzyński, Krzysztof Malaga - Neo-Schumpeterian Economic Growth Model Including the Capital Market

An original neo-Schumpeterian endogenous model of economic growth is presented in the article. The model includes the capital market and is an expansion of the Aghion-Howitt model [2009]. In the model, the rate of economic growth is equal to the rate of growth of the average level of technology, which is a direct consequence of innovation, the authors say.
The following sets of agents are identified in an economy described with this model: the final production sector, the intermediate production sector, the R&D sector, the government sector, and the capital market. On this basis, the dynamics of the economy was described.
The theoretical discussion was expanded to include empirical research, in which the key parameters of the model were calibrated. Additionally, a Monte Carlo simulation of the economy’s dynamics was performed.
On the basis of the research, the authors concluded that the main determinant of economic growth is the process of generating innovations by enterprises, which directly influences the level of technology used in production. The capital market has a significant impact on the dynamics of processes occurring in the real economy, the authors note. Technological competition helps achieve the desired state of the economy. The authorities support technological competition because it promotes the growth of the frontier level of technology and spurs economic growth. Enterprises strive to maximize their expected profits from their core business, which encourages them to improve their production technology and outperform the competition. The expectations of companies about future economic trends play an important role in shaping the dynamics of the whole system. The key issue is how risk aversion influences the portfolio investment process, the real economic decisions of enterprises and consequently economic growth, the authors note.
According to Burzyński and Malaga, their research conclusions are crucial in terms of determining whether there is a dynamic equilibrium between the financial and real spheres of the economy—in other words, between the capital market, on the one hand, and innovation, technological progress and growth, on the other. Another key question is whether the liquidity and development of the capital market help spur economic growth, and how investors’ risk aversion influences the process of implementing innovations. Finally, the article sheds light on how the volatility of the capital market influences economic growth, the authors say.

Keywords: neo-Schumpeterian endogenous model of economic growth, capital market, innovation, creative destruction, technological progress, diffusion of technology
Article: PDF

Dariusz Leśko - A Model of Firm Growth

International statistics show that small firms are the dominant form of business enterprise today. Yet, despite ongoing research into the theory of the firm, there is still no common view on the mechanisms of firm growth. This article aims to stimulate further theoretical and empirical research into firm growth.
In the first part of the paper, the author reviews the most seminal theories of the growth of the firm to date, noting that there are two broadly perceived schools of thought within the analysed field. The first approach advocates a more or less stochastic pattern of firm growth. The second research school holds that the resources at the firm’s disposal are the differentiators, drivers of, but also limits to, firm growth.
In the second part of the paper, based on the literature review and deduction, the author develops an alternative model of firm growth. Building on the properties of the Markovian processes, he shows that it may be because of the seemingly rational behaviour of firm incumbents that most firms do not grow in size beyond some satisfying level. The proposed model of firm growth is equally applicable to firms of all sizes operating in all industries and markets.

Keywords: firm, theory, growth, size, life cycle
Article: PDF

Anna Sulima - The Stability of the Nonneman-Vanhoudt Model with the CES Production Function

The paper aims to show that the Nonneman-Vanhoudt growth model with the n-capital CES macroeconomic production functionis asymptotically stable in a certain environment. The Nonneman-Vanhoudt model of economic growth is conducted with an assumption that the CES production function is described by a system of ordinary differential equations. To investigate the stability of the model, a criterion resulting from the Hartman-Grobman theorem was used. The stability of this model means that if the structure of resources, the investment rate, and the rate of capital depreciation change slightly, the economy will tend toward astationary point that can be regarded as a long-term equilibrium in the considered model of economic growth. The author examines the properties of the growth model and focuses on factors including the growth of labor productivity, equipment and output per unit of effective labor.

Keywords: stability of model, n-capital growth model, production function
Article: PDF

Monika Fiedorczuk - The Role of Corporate Groups in Russia

The paper focuses on the origins, organizational structure and operations of corporate groups in Russia and their role in the economy.
Corporate groups began to emerge and develop in Russia in the early 1990s in the wake of the privatization of state-owned enterprises, the author says. Their development was influenced by the so-called “loans for shares” program and a financial crisis in 1998.
Most of Russia’s corporations have developed through either vertical or horizontal integration, and they also emerged in the form of conglomerates. Most corporations operate in industries such as oil, gas, chemicals, petrochemicals, power, metallurgy, steel and machinery. Characteristically, there are specific financial and interpersonal ties between representatives of individual companies within each group, Fiedorczuk says. In most Russian corporate groups, the main owners are oligarchs, or wealthy businessmen with an extensive network of political connections.
Corporations play an important role in Russia’s economic, political and social life, the author notes. But they are also under heavy pressure from the country’s political authorities. As in other developing countries, corporate groups in Russia outperform single businesses in terms of financial and economic indicators. Overall, corporations may be an optimal response to market and government failures in a process of economic transition, Fiedorczuk concludes.

Keywords: Russia, corporate groups, privatization, oligarchs
Article: PDF

Vitali Naumavets - The Development of Polish-Owned Companies on the Belarusian Market

The paper deals with the development of Polish-owned companies on the Belarusian market, identifying their key development strategies.
A relatively large number of Polish businesses are active on the Belarusian market, the author says. At the beginning of 2010, a total of 532 Polish-owned companies were registered in Belarus, according to data by Poland’s Ministry of Foreign Affairs.
In addition to studying research reports on the topic, the author collected data through telephone interviews as well as a questionnaire, which was the main research method.
According to the author, every company, by its very nature, seeks to grow; this trend can also be observed Polish-owned companies doing business in Belarus. The research indicates that product development and, in some cases, market penetration were the most effective development strategies among the surveyed companies, Naumavets says.
Doing business abroad requires a company to focus especially strongly on its competitive advantages, because a foreign company is a usually at a disadvantage with regard to the local competition, according to the author. This explains why foreign companies should focus on competitive strategies as proposed by American economist Michael Porter, Naumavets notes.
The most common strategy among the surveyed companies was one based on standing out in the marketplace. This strategy makes it possible to achieve and maintain a sustainable competitive advantage, according to the author. Polish-owned companies active in Belarus usually try to stand out in their relations with customers and suppliers as well as in terms of business reputation, quality and price.

Keywords: Polish-owned companies, Belarusian market, development strategies, competition, efficiency
Article: PDF

Anna Jarosz-Nojszewska - Józef Krzyczkowski and the Social National Club

The article reflects on the life and work of economist and politician Józef Krzyczkowski (1901-1989), with a special focus on his ties with organizations such as the National Economy Club and the Social National Club. The author examines Krzyczkowski’s professional career using data collected at the Warsaw School of Economics Archives and the Central Archives of Modern Records in Warsaw. Krzyczkowski’s social and economic activities in the period between the two world wars and after WW II were of special interest to Jarosz-Nojszewska. She also delves into the wartime experiences of Krzyczkowski, who commanded Polish Home Army troops in Kampinos Forest in his capacity as Lt. Col. “Szymon.”
The main part of the article is dedicated to Krzyczkowski’s involvement in economic discussion clubs in the 1930s. This is the least researched period of his life, Jarosz-Nojszewska says. Krzyczkowski co-founded an organization called the National Economy Club. After the death of Poland’s erstwhile leader Marshal Józef Piłsudski, Krzyczkowski founded another organization called the Social National Club, which published its own weekly periodical entitled Zespół. The Social National Club called for far-reaching political and economic changes in Poland, as reflected by its key publication Podstawy doktryny społeczno-narodowej (The Fundamentals of the Social National Doctrine). The publication provoked criticism of the National Economy Club community, whose members were accused of disseminating communism, especially by those with conservative views. The dispute reached the courtroom, but it remained unresolved due to the outbreak of WW II.

Keywords: Józef Krzyczkowski, “Szymon,” Juliusz Poniatowski, Stefan Starzyński, Czesław Bobrowski, Gospodarka Narodowa, National Economy Club, Social National Club
Article: PDF

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