List of issues

Contents of issue 1-2/2007

Cezary Józefiak - The Choice of the Market Economy Model, article

Tomasz Tokarski - Scale Effects and Economic Growth, abstract, article

Anna Zorska - Outsourcing and the Transfer of Services Around the World: Implications for Poland, abstract, article

Paweł Gajewski - The Economic Effects of Regional Policy, abstract, article

Piotr Rosik - Spatial Spillovers in Infrastructure Investment Projects: The Case of Galicia, abstract, article


Richards B. Freeman - People Flows in Globalization, article


Book Review: Maciej Bałtowski, Maciej Miszewski, Transformacja gospodarcza w Polsce (Economic Transition in Poland), Wydawnictwo Naukowe PWN, Warsaw 2006, 360 pp. - reviewed by Elżbieta Mączyńska

Book Review: I. Fierla (ed.), Geografia ekonomiczna Unii Europejskiej (The Economic Geography of the European Union), Polskie Wydawnictwo Ekonomiczne, Warsaw 2007, 366 pp. - reviewed by Elżbieta Kawecka-Wyrzykowska

Book Review: Franciszek Tomczak, Gospodarka rodzinna w rolnictwie (Family Farms in Agriculture), Instytut Wsi i Rolnictwa Polskiej Akademii Nauk, Warsaw 2005, 467 pp. - reviewed by Anna Henisz-Matuszczak

Tomasz Tokarski - Scale Effects and Economic Growth

The paper focuses on the neoclassical production function and its influence on the economic growth model proposed by N. Gregory Mankiw, David Romer and David N. Weil [1992]. The model is an expanded version of the traditional neoclassical model developed by Robert M. Solow [1956]. In the context of the production function, the author examines the influence of scale effects on long-term growth and basic macroeconomic variables such as output, physical capital, human capital and consumption per worker. He also reviews scale effects in terms of Edmund S. Phelps’ golden rules of capital accumulation [1961, 1966].
The analysis includes differential equations of the type used by Bernoulli and Riccati to describe increases in physical and human capital stock per unit of effective labor (in the case of constant scale effects) and increases in capital stock growth rates (in the case of decreasing and growing scale effects).
The paper ends with a number of important conclusions. First, under constant scale effects, the long-term rates of growth for basic macroeconomic variables are equal to the rate of Harrod-neutral technological progress (which is an exogenous variable in the Mankiw-Romer-Weil model). Second, under decreasing/growing scale effects, these rates are lower/higher than the rate of Harrod-neutral technological progress. Third, repealing the constant-scale-effects assumption in the Mankiw-Romer-Weil growth model does not change the golden rules of capital accumulation because, regardless of whether scale effects decrease, grow or are constant, the golden rule of accumulation holds that the structure of investment rates corresponds to the elasticities of output with regard to physical and human capital inputs.

Keywords: scale effects, production function, economic growth
Article: PDF

Anna Zorska - Outsourcing and the Transfer of Services Around the World: Implications for Poland

The paper sets out to examine the microeconomic aspects of the outsourcing and international transfer of services. To this end, the author defines some basic terminology linked with this process as well as its mechanisms and ties between enterprises in different countries. A chart showing a network of cross-border ties and service flows is presented, as well as the results of various business activities.
Changes taking places in enterprises are analyzed from the perspective of evolution of their business operations, management and foreign expansion. The author highlights the importance of information and communication technology (ICT) in these processes. She shows that ICT services tend to be moved from developed countries to the Third World and Central Europe, among other regions, largely because Western European companies want to reduce their production and transaction costs. Many Central European countries are capable of providing modern ICT services at competitive prices.
Modern ICT services range from data processing to know-how development, and the general rule is that technologically advanced services produce greater benefits for the service provider and the host country. The movement of services, technology and capital linked with outsourcing is a dynamically developing segment of the international market. Polish companies should step up their activities to win a larger portion of the market even though this forces them to meet a number of conditions, some of which depend on what happens in their business and institutional environments.

Keywords: outsourcing, services, cross-border ties
Article: PDF

Paweł Gajewski - The Economic Effects of Regional Policy

The author analyses the relationship between regional disparities and economic efficiency. He also examines the efficiency of regional policy tools in the context of regional disproportions and economic efficiency.
In the first part of the paper, the author discusses the main areas of controversy concerned with the regional distribution of business activity and its influence on economic growth. Then, using a graphic model to present the theory of endogenous growth and the New Economic Geography—and additionally considering social capital—Gajewski analyzes the economic effects of interregional transfers, subsidies for enterprises, investment in transport infrastructure and innovation policy.
The author concludes that regional policy measures designed to support the regional diffusion of innovation and reduce its costs are the most effective instrument of regional policy, from the perspective of economic efficiency and the need to level out regional differences. Subsidies to enterprises seem to be the least beneficial, if not harmful, regional policy tool, Gajewski says. His research findings indicate that the use of various other regional policy instruments leads to an “equity-efficiency tradeoff,” or a conflict between economic and social objectives.

Keywords: regional policy, development disparities, New Economic Geography
Article: PDF

Piotr Rosik - Spatial Spillovers in Infrastructure Investment Projects: The Case of Galicia

This paper sets out to provide evidence for the existence of spatial spillovers linked with the development of transport infrastructure. The author makes an attempt to measure the influence of both regional infrastructure (direct effect) and non-regional infrastructure (indirect effect) on gross value added generated in a region. In doing so, Rosik builds a bridge between the growth theory and the New Economic Geography concept.
The author considers the case of Spain’s Galicia region in 1980-2000. The analysis makes use of the Cobb-Douglas production function, expanded to include transport infrastructure with the use of Spanish statistical data.
The analysis confirmed the existence of negative spatial spillovers linked with infrastructure investment projects in this outlying district of Spain. The data shows that gross value added is positively correlated to the development of transport infrastructure in Galicia, but negatively correlated to the development of transport infrastructure in neighboring regions. The research findings confirm theoretical conclusions reached by economists linked with the so-called New Economic Geography theory to the effect that intraregional infrastructure has a positive influence on the development of outlying regions, while interregional infrastructure may lead to a deepening of regional disparities. This stems from the fact that, thanks to reduced transaction costs in interregional trade, companies are tempted to relocate their operations to more affluent regions. Rosik’s findings, supported by other empirical studies and theoretical discussions, are especially significant to Poland’s eastern regions, which are less developed than the rest of the country.

Keywords: spatial spillovers, infrastructure investment, Cobb-Douglas production function
Article: PDF

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