Employment Protection Legislation and Labor Markets in Transition: Assessing the Effects of the Labor Code in Armenia

The effects of employment protection legislation (EPL) on a country's labor market are clear in theory but empirical evidence is only starting to catch up. In particular, EPL is not robust as an indicator of overall unemployment, but previous panel data analyses have shown it affects the flow of workers into and out of employment. Examining monthly and quarterly data from Armenia, I find that the country's package of EPL has this same effect, and worker flows have slowed under the country's new Labor Code. The paradox of where Armenia's workforce is going still remains but can be hypothesized as entering the informal sector.employment protection legislation, labor markets, transition

Firm-level and institutional determinants of corporate capital structure in Poland: New evidence from the Warsaw stock exchange

This paper discusses how well major capital structure theories incorporate firm-level and institutional factors into short-term firm financing decisions in a specific context, that of a transition economy. Using a new dataset of non-financial companies quoted on the Warsaw Stock Exchange between 2007-2015, we argue that neither the trade-off nor the pecking order theories fully explain corporate debt policies in Poland. The results of dynamic panel data modelling highlight the importance of the strength of property rights and stock market capitalisation as driving forces behind corporate financing decisions

Firm-Level and Institutional Determinants of Corporate Capital Structure in Poland

This paper discusses how well major capital structure theories incorporate firm-level and institutional factors into short-term firm financing decisions in a specific context, that of a transition economy. Using a new dataset of non-financial companies quoted on the Warsaw Stock Exchange between 2007-2015, we argue that neither the trade-off nor the pecking order theories fully explain corporate debt policies in Poland. The results of dynamic panel data modelling highlight the importance of the strength of property rights and stock market capitalisation as driving forces behind corporate financing decisions

The Price of Empire: Unrest Location and Sovereign Risk in Tsarist Russia

Research on politically motivated unrest and sovereign risk overlooks whether and how unrest location matters for sovereign risk in geographically extensive states. Intuitively, political violence in the capital or nearby would seem to directly threaten the state's ability to pay its debts. However, it is possible that the effect on a government could be more pronounced the farther away the violence is, connected to the longer-term costs of suppressing rebellion. We use Tsarist Russia to assess these differences in risk effects when unrest occurs in Russian homeland territories versus more remote imperial territories. Our analysis of unrest events across the Russian imperium from 1820 to 1914 suggests that unrest increases risk more in imperial territories. Echoing current events, we find that unrest in Ukraine increases risk most. The price of empire included higher costs in projecting force to repress unrest and retain the confidence of the foreign investors financing those costs.Comment: 13 Tables, 8 Figure

All That’s Old is New Again: Capital Controls and the Macroeconomic Determinants of Entrepreneurship in Emerging Markets

While a growing amount of economic evidence has emerged that capital controls as a tool may both be ineffective for many of their stated purposes, there has been little examination of their long-term effects that can harm rather than help entrepreneurship in emerging markets. The purpose of this paper is to fill this gap and examine capital controls in both a historical and recent context, ascertaining their possible effect on firms and entrepreneurship in emerging markets in coming years. What will the impact be on emerging markets and firms in developing countries if capital controls continue to gain credibility? How has the rebirth of controls in the wake of the global financial crisis affected entrepreneurship in emerging markets

Identity and the evolution of institutions : evidence from partition and interwar Poland

This paper advances a logical, if possibly controversial, thesis: institutional design is inherently a product of identity, at both the individual and group level. Building on recent advances in identity economics and new institutional economics, this research shows how identity can be used to explain institutional genesis and the persistence of “inefficient” institutions. Applying this model to Poland in the nineteenth and early twentieth centuries, it is evident that the identity-based institutional building which had served individuals so well under occupation in Poland resulted in “inefficient” institutions, unsuited for the changing external environment. Only taking an identity lens to the Polish experience can we see a satisfactory explanation for the failure of institutions in interwar Poland

Market behavior in the face of political violence : evidence from Tsarist Russia

Even efficient financial markets may break down under periods of prolonged stress, especially when the ramification of an event is unclear. Political violence is such an event, sending immediate signals about possible impact on firm valuations but unclear information about the future viability of existing institutions. This paper examines the effect of political violence in 19th century Russia on its stock market; using a battery of unit root and variance ratio tests, the evidence is that Russian financial markets were mostly efficient in processing short-term information from political violence. However, when violence was at its peak between the assassination of the Tsar in 1881 and the 1905 revolution, large deviations from efficiency can be detected, as markets were unsure about the viability of the existing rules of the game

Populism and financial markets

How do financial markets react to populist electoral success? Theoretically, the effect can go in one of two directions. In the first instance, populists tend to espouse resolutely anti-finance ideas, and thus a populist wave would be expected to be bad for financial returns across the board. On the other hand, populists also tend to enact various stimulus and redistributive schemes, and these policies could also give a boost to financial markets. Additionally, in the long-term, if populists become entrenched, they take over the commanding heights, meaning a need for functioning financial markets in order to provide capital for the elites. Utilizing new advances in the measurement of populism, this paper amasses a database of populist advances across developed economies since 2008 and arrays them against equity market performance. Using EGARCH-M volatility modelling on pooled data and event studies on specific episodes of populist success, this analysis reveals that a) populism's effect in the short run is mainly through volatility channels and b) populism's longer-term effects are highly dependent on the specific brand of populism and the country context in which populism operates

In our (frozen) backyard : the Eurasian Union and regional environmental governance in the Arctic

Erworben im Rahmen der Schweizer Nationallizenzen (http://www.nationallizenzen.ch)Regional environmental governance has emerged as a viable alternative to supranational environmental solutions, using regional and local knowledge and actors to tailor more efective policies. This does not deny a role for supranational institutions, however, which can enable their members to efectively shift towards such a decentralized and polycen tric approach. In specifc regions such as the Arctic, with many national and local actors interested in environmental improvement, such impetus from meta-organizations (i.e., organizations comprised of organizations) could result in benefcial environmental out comes. This paper examines an underutilized institution, the Eurasian Union (EaEU), and the role it currently plays in facilitating regional environmental governance. Focusing on its largest member, Russia—and the only member with an Arctic linkage—I explore the tension between supranational facilitation and interference in an area not directly afect ing all members. Despite explicit Russian interest in this realm, the EaEU may be able to infuence Russian environmental policy for the better via multilateral means and internal mechanisms. By challenging the Russian monopoly on Arctic policy in the EaEU, these additional voices may

What Drove the First Response to the COVID-19 Pandemic? The Role of Institutions and Leader Attributes

What determines how a national government reacts in a crisis? The COVID-19 pandemic provides an opportunity to explore leadership behavior and crisis management, and this paper examines what drove the extent of the lockdown in countries around the world during the first wave of coronavirus. In particular, this paper posits that many of the policies undertaken were “extraordinary,” that is unlike those ever implemented or complemented by the leaders in charge at the start of the pandemic. Utilizing new and high-frequency data on government responses to COVID-19 and novel statistical techniques, the results of this analysis are that institutions and leadership attributes both matter, but for different policies; where the response called for more ‘normal” policies, it appeared that institutional mechanisms were adequate and played the largest role in influencing the extent of the lockdown. On the other hand, where the policies contemplated were very far from the ordinary (including stay-at-home orders or prohibitions on internal travel), the attributes of the leader determined the stringency of the lockdown more than institutions