List of issues

Contents of issue 9/2012

Lobna Bousrih - Finance and Long Run Growth: The Role of Formal and Informal Institutions, abstract, article

Natalia Nehrebecka, Maria Jarosz - The Financial Condition of Polish Companies and Its Impact on Investment in Fixed Capital, abstract, article

Bernadeta Baran - Sovereign Wealth Funds and Their Role on the Global Capital Market, abstract, article

Arkadiusz Michał Kowalski, Andrzej Marcinkowski - Clusters as Economic Growth Poles: The Case of the Bavarian Biotechnology Cluster, abstract, article

Dorota Czyżewska - Competitiveness Clusters as a Platform for Collaboration Between Science and Business in France, abstract, article


Book Review: Michał Brzoza-Brzezina, Polska polityka pieniężna. Badania teoretyczne i empiryczne (Polish Monetary Policy: Theoretical and Empirical Studies), Wydawnictwo C.H. Beck, Warsaw 2011, 190 pp. - reviewed by Wojciech Pacho

Book Review: Stanisław Miklaszewski, Joanna Garlińska-Bielawska, Jacek Pera (eds.), Natura i różnorodność przebiegu światowego kryzysu gospodarczego (The Diverse Nature of the Global Economic Crisis), Difin, Warsaw 2011, 238 pp. - reviewed by Marek Lubiński

Book Review: Aleksandra Nowakowska, Regionalny wymiar procesów innowacji (The Regional Aspect of Innovation), Wydawnictwo Uniwersytetu Łódzkiego, Łódź 2011, 241 pp. - reviewed by Marian Gorynia

Lobna Bousrih - Finance and Long Run Growth: The Role of Formal and Informal Institutions

The paper aims to empirically analyze the effect of the quality of the formal institutional environment and social capital on financial development and long-run economic growth for a sample of developed and developing countries using the Generalized Method of Moments (GMM) for the period spanning from 1980 to 2009. The author sets out to find out if there is a synergetic effect between financial sector development and: first, formal institutional aspects measured by the institutional environment quality index, second, informal institutional aspects measured by the level of social capital in society. The article examines if the qualities of formal institutions as well as the level of confidence and cooperation between individuals are important to promoting financial sector and consequently long-run economic growth.
The main results of the model are that (i) the development of formal institutions with a higher level of general institutional quality has a positive impact on long-run economic performance through the development of financial markets; (ii) the effect of financial sector development on long-run economic growth also depends on the state of informal institutions with a higher level of trust between individuals.

Keywords: financial development, institutions, social capital, economic growth
JEL classification codes: O16, O17, O43, Z13
Article: PDF

Natalia Nehrebecka, Maria Jarosz - The Financial Condition of Polish Companies and Its Impact on Investment in Fixed Capital

The article looks at how the financial condition of companies influences their investment policies. To estimate the significance of individual financial indicators, the authors used data from the balance sheets and profit and loss accounts of more than 58,000 non-financial Polish firms from the 1995-2010 period. The Generalized Method of Moments (GMM) was used for the estimations.
The model described in the article involves estimates of individual, sectoral and time effects. It indirectly takes into account the cost of capital in the investment equation. The cost of capital is a variable that is extremely difficult to observe at the level of individual companies, the authors say. The analysis was conducted for different groups of companies arranged by size.
On the basis of the estimated econometric models, the authors validated a hypothesis about a significant influence of financial ratios on companies’ investment rates. An improvement in the cash flow has the greatest contribution to the investment rate, the authors say, and this effect is strongest in the case of small companies.
While analyzing the impact of the cash flow on the investment rate, the authors confirmed the strong non-linearity of the trend for all groups of enterprises. In addition, they found that the financial pressure felt by companies in the form of debt and costs of interest reduces the level of investment. In the context of the monetary policy transmission mechanism, this may point to the existence of interest rate and balance sheet channels, the authors say. Another conclusion from the research is that financial pressure increases the probability of the financial accelerator mechanism – or a situation in which adverse shocks to the economy may be amplified by worsening financial market conditions.
In the estimated model, small businesses turned out to be far more sensitive in their investment policies to an economic downturn than the corporate sector as a whole. The financial condition of enterprises reflected by selected indicators clearly influences the investment decisions of individual companies, and sensitivity to these indicators in terms of investment additionally depends on company size. This is important for assessing the mechanism whereby monetary policy is transmitted to the small and medium-sized enterprise (SME) sector, the authors say.

Keywords: financial pressure, fixed investment, balance sheet channel, panel data
JEL classification codes: C33, E22, G32, J23
Article: PDF

Bernadeta Baran - Sovereign Wealth Funds and Their Role on the Global Capital Market

The article examines the role of sovereign wealth funds (SWFs) on the global capital market. Sovereign wealth funds are state-owned investment funds that invest globally in financial assets such as stocks, bonds, property, precious metals and other financial instruments.
The author defines sovereign wealth funds and describes their market position. She also refers to some controversial issues related to the operations of sovereign wealth funds and discusses the policy of the European Union vis-à-vis SWFs.
The research method used by the author is based on analyzing data on the operations of sovereign wealth funds published by the Sovereign Wealth Fund Institute and the International Monetary Fund (IMF). The article also reviews a body of research conducted in EU countries and source documents.
The study shows that sovereign wealth funds are becoming an increasingly important participant in the global financial system, the author says. In recent years, SWFs have grown in number and their investments have increased significantly. In particular, this applies to SWFs based in emerging-market countries. Although these funds provide the desired capital and contribute to the stabilization of the financial market, their growing significance raises some concerns, the author says. These concerns stem from the low transparency of many SWFs in terms of their organizational structures and objectives and from the potential implications of their international operations. A further concern is the rapid development of such forms of investing public funds in the wake of changes in the structure of global production, accompanied by a widening imbalance in international trade, and changing relations between developed and emerging economies.
Sovereign wealth funds have been investing governments’ foreign assets for decades, but it is only recently that such funds have emerged as managers of large excess reserves, the author notes. SWFs are likely to continue growing and increase their importance on global financial markets, the author says.

Keywords: sovereign wealth funds, institutional investors, international capital markets
JEL classification codes: F34, G15, G18, H87, 016
Article: PDF

Arkadiusz Michał Kowalski, Andrzej Marcinkowski - Clusters as Economic Growth Poles: The Case of the Bavarian Biotechnology Cluster

The article focuses on business clusters, which have become a popular method for organizing business operations, based on the geographical and sectoral concentration of enterprises. Business clusters are analyzed primarily in the context of the growth pole theory formulated by French economist François Perroux. Under this approach, sectoral polarization, or the rapid development of some sectors of the economy, influences spatial polarization, which means the emergence of locations (referred to as growth poles) characterized by a higher growth rate than other areas. This article aims to validate the hypothesis that clusters can act as growth poles for the economy because they represent an effective mechanism for concentrating resources and stimulating cooperation, conducive to the further development of the sector. This hypothesis is validated on the basis of an analysis of the Bavarian Biotechnology Cluster, which is one of the strongest biotechnology centers in Europe. This cluster acts as a growth pole for Germany’s Bavaria region, influencing the development of the biotechnology sector, one of the most advanced sectors of the regional economy. The Bavarian Biotechnology Cluster also helps disseminate knowledge and innovation, thus contributing to greater innovation and competitiveness of the regional economy. The growing popularity of clustering and the concept of cluster-based development policies have encouraged the Bavarian authorities to take action to support this form of cooperation in the economy. These measures cover the biotechnology sector, one of the key sectors of the Bavarian economy.

Keywords: clusters, growth poles, biotechnology, innovation, regional development
JEL classification codes: O30, R10, R58
Article: PDF

Dorota Czyżewska - Competitiveness Clusters as a Platform for Collaboration Between Science and Business in France

The article offers an overview of the functioning of France’s competitiveness clusters as a response to the European Union’s Europe 2020 strategy. The role of competitiveness clusters is to strengthen the innovativeness and competitiveness of companies and to reinforce industry-science relations. The paper is based on a literature review and on empirical research using questionnaires and in-depth interviews.
The paper reviews Europe 2020 targets for the EU as a whole and for France in particular as well as guidelines to achieve these targets in terms of industry-science cooperation formulated in France’s National Reform Program for the 2011-2014 period. The author also discusses the specific nature of French competitiveness clusters and the results of empirical research on cooperation between companies and public research centers. The main conclusion resulting from the empirical research is that cooperation between these two actors is still fraught with difficulties.

Keywords: competitiveness cluster, Europe 2020 strategy, France, university-industry cooperation
JEL classification codes: F23, L52, F59, O52
Article: PDF

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