Gospodarka Narodowa
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Contents of issue 4/2010

Krzysztof Ćwikliński - The Global Economic Crisis and its Impact on the Indebtedness of the World’s Poorest Countries, summary, article

Adrian Kożuchowski - "The Resource Curse": An Analysis of Geographical and Institutional Factors, summary, article

Henryk Wnorowski - The Impact of Taxes on Economic Growth and Competitiveness in the Institutional Approach, summary, article

Łukasz Goczek - The Causes of Corruption in Postcommunist Countries, summary, article

Dorota Wawrzyniak - The Location Determinants of Foreign Direct Investment, summary, article


Book Review: Walentyna Kwiatkowska (ed.), Bezrobocie równowagi w gospodarce polskiej. Szacunki, tendencje i determinanty (Equilibrium Unemployment in the Polish Economy: Estimates, Trends and Determinants), Wydawnictwo Uniwersytetu Łódzkiego, Łódź 2009, 250 pp. - reviewed by Wacław Jarmołowicz, Beata Woźniak-Jęchorek

Book Review: Władysław Szymański, Kryzys globalny. Pierwsze przybliżenie (The Global Crisis: A Preliminary Assessment), Difin, Warsaw 2009, 213 pp. - reviewed by Piotr Ważniewski

Book Review: Mariusz Sagan, Iwona Sierzputowska (eds.), Praktyka skutecznego zarządzania przedsiębiorstwem (Effective Business Management Practices), Difin, Warsaw 2009, 287 pp. - reviewed by Jacek Brdulak

Krzysztof Ćwikliński - The Global Economic Crisis and its Impact on the Indebtedness of the World’s Poorest Countries

In the 19th and 20th centuries, economic crises drove many developing countries into debt. The paper discusses the impact of the latest global economic crisis on the indebtedness of the world’s poorest nations. The author analyzes changes in the inflow of funds to these countries and the efforts of international financial institutions, such as the World Bank and the International Monetary Fund (IMF), to mitigate the problem of indebtedness.
Due to the latest crisis, less foreign investment has reached the world’s poorest nations over the past year or so, Ćwikliński says, and their export revenues have also decreased. Revenues from tourism and cash transfers from people working and living abroad have remained stable, after a previous period of consistent growth. The decreased inflow of private capital explains why these countries are struggling with widening budget deficits. To facilitate the implementation of the Millennium Development Goals (MDG), international financial institutions are providing support to the poorest countries in the form of new loans. To reconcile these efforts with the World Bank and IMF’s Debt Sustainability Framework for Low-Income Countries (DSF), work is under way to change the way in which international financial institutions calculate the level of debt that they consider to be serviceable by these countries.
Although preferential loans enable the world’s poorest nations to finance some of their development priorities, these countries will have to return these funds sooner or later. Considering that these countries are already heavily indebted, this may compound their financial problems. Further measures to reduce their financial obligations may prove to be unavoidable over the next decade or so. Moreover, the need to repay new loans may make it difficult for low-income countries to carry out those MDGs that are not attained by the expected deadline.

Keywords: indebtedness, debt, development aid, poor nations, crisis, World Bank, International Monetary Fund, Millennium Development Goals (MDG)
Article: PDF

Adrian Kożuchowski - "The Resource Curse": An Analysis of Geographical and Institutional Factors

The paper uses a set of international data to analyze the impact of countries’ resource abundance on their long-term economic growth. In particular, the author focuses on explaining the essence of what is known as the "resource curse". He uses two groups of determinants, geographical and institutional.
The paper begins with a look at the gist of the problem, with the author discussing the rationale behind the research. This is followed by a discussion of other research reports on the subject and a short description of other authors’ findings.
In the next part of the paper, Kożuchowski describes his own research method and the set of variables that he uses for his OLS-regression model. The parameters are estimated with the use of geographical and institutional variables, separately for each group, and the final versions of the models are selected on the basis of a set of reliable statistical tests, Kożuchowski says. The author makes several assumptions about "the resource curse". His research shows that key factors of growth include economic openness and political stability, while most geographical factors are not statistically or intuitively significant, Kożuchowski says.
The author emphasizes the role of soft data for that kind of research. The results show that such variables adequately reflect the institutional position of countries, Kożuchowski concludes.

Keywords: resource curse, economic growth, determinants of growth, resource abundance, econometric models, Dutch disease, institutional quality, OLS-regression model
Article: PDF

Henryk Wnorowski - The Impact of Taxes on Economic Growth and Competitiveness in the Institutional Approach

The paper looks at the changes that have taken place in the way researchers examine the influence of taxes on economic growth and competitiveness, both in Poland and elsewhere. These changes have primarily involved a broader look at this issue over the past decade or so, the author says.
For decades in the past, researchers focused on analyzing the direct influence of taxes on economic growth. With time, they expanded their approach to include various aspects of taxation and types of taxes. They began to separately examine the impact of personal income tax, corporate income tax and indirect taxes, looking at their average, minimum and maximum effects through the lens of supply-side economics. Supply-side economics is an economic theory that states that a reduction in taxes stimulates the economy enough to recoup the lost revenue.
Today those researching the impact of taxes on economic growth and competitiveness increasingly acknowledge that the influence of taxes on an economy depends on the context in which tax policy is pursued, Wnorowski says. This particularly applies to institutional conditions in which taxes are levied and modified. Of special importance are any legislative difficulties or limitations encountered by tax policymakers, the overall thrust of government policy, and the efficiency of authorities responsible for the enforcement of tax regulations and laws, according to the author.
Wnorowski analyzes research reports on the subject and he also takes a look at expert studies by international institutions such as the World Bank and Organization for Economic Cooperation and Development (OECD). Such studies have abounded in the last few years, highlighting the role of various institutional factors, according to Wnorowski. When analyzed collectively, institutional factors make it possible to better understand the relationship between taxes and economic growth as well as changes in the level of competitiveness. Overall, an institutional economic approach is now increasingly common in research into the influence of taxes on economic growth, the author says.

Keywords: taxes, tax system, economic growth, competitiveness, supply-side economics, institutional economics, transaction costs
Article: PDF

Łukasz Goczek - The Causes of Corruption in Postcommunist Countries

The paper provides an empirical analysis of the causes of corruption in postcommunist countries. Researchers vary in their evaluation of how economic policy instruments and structural factors influence the level of corruption in these countries, Goczek says. He looks at the two main hypotheses about the sources of corruption in the region. The first hypothesis holds that the current level of corruption in postcommunist countries is largely due to what happened under communism, including the institutional standards of the time. The other hypothesis is that these countries’ transition from central planning to a market economy is largely responsible for the current level of corruption in the region.
Both models discussed in the article proved to be useful in explaining the level of perceived corruption in postcommunist countries, the author says. In the first model, Goczek checked if the current scope of corruption has its roots in these countries’ communist past. The empirical study showed that the more economically developed a particular country was in 1989, the more successful it was in dealing with the problem of corruption. Generally, the extent of central planning in the economy proved to be the most significant factor, Goczek says. He argues that the level of perceived corruption in a given country depended on the scope of central planning and the resulting market disturbance.
In the second model discussed in the paper, the author tries to check if market reforms contributed to an increase in corruption in Central and Eastern Europe. According to some researchers, wide-ranging redistribution processes linked with privatization and liberalization in the economy frequently encouraged corruption after the fall of communism. Goczek’s analysis of economic policy choices reveals that the level of corruption in Central and Eastern Europe is lower than in the former Soviet Union. While most Central and Eastern European countries as well as the Baltic states introduced far-reaching economic reforms at the start of transition, Goczek says, former Soviet republics dragged their feet on such reforms. As a result, the levels of corruption in these two regions differ considerably. Generally, those countries that quickly carried out economic reforms managed to arrest and even reverse the progress of corruption after the fall of communism, Goczek concludes.

Keywords: corruption, postcommunist countries, economic growth, central planning, market reforms
Article: PDF

Dorota Wawrzyniak - The Location Determinants of Foreign Direct Investment

The paper reviews empirical studies on how various location factors influence foreign direct investment (FDI). The author focuses on some recent research and takes into account determinants such as market size, market growth, labor costs, labor quality, openness to trade, geographic distance, taxes, country risk, and corruption. These factors do not represent a closed set of factors that affect FDI location decisions, but are most frequently considered, Wawrzyniak says. Research theories list many factors that can influence the location of FDI. These include economic determinants (that depend on the type of FDI) as well as the policy framework for FDI and business facilitation. Moreover, these FDI determinants tend to change over time, Wawrzyniak says, and some of them, such as privatization of transition economies, are particularly important to some countries and regions.
Empirical studies on the impact of various determinants on the location of FDI are inconclusive because different authors have reported different results. Some researchers say that a specific factor has a positive influence on FDI, while others argue the opposite. Still others believe that this particular factor is statistically insignificant. However, not all the potential determinants of FDI are equally controversial, Wawrzyniak says. The results of empirical research on different location factors show a varying level of consistency. They are generally more consistent in the case of factors such as market size and less consistent in the case of labor costs, for example.

Keywords: foreign direct investment, FDI determinants, location, empirical research
Article: PDF

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