The Determinants of Foreign Direct Investment in Transition Economies

Using a panel dataset containing information on FDI flows from market to transition economies, we establish the determinants of FDI inflows to Central and Eastern Europe: country risk, unit labour costs, host market size and gravity factors. In turn, we find country risk to be influenced by private sector development, industrial development, the government balance, reserves and corruption. By introducing structural shift dummy variables for key announcements of progress in EU accession we show that announcements have impacted directly upon FDI receipts but have not influenced country credit ratings. The Agenda 2000 announcement by the European Commission induced a bifurcation between the 'first wave' transition countries and the remainder of our sample. The underlying dynamics of the process illustrate that increases in FDI improve country credit ratings with a lag, hence increasing future FDI receipts. Consequently we suggest that the accession progress has the potential to induce virtuous cycles for the frontrunners but may have serious consequences for the accession laggards.http://deepblue.lib.umich.edu/bitstream/2027.42/39726/3/wp342.pd

The Determinants of Foreign Direct Investment in Transition Economies

Using a panel dataset containing information on FDI flows from market to transition economies, we establish the determinants of FDI inflows to Central and Eastern Europe: country risk, unit labour costs, host market size and gravity factors. In turn, we find country risk to be influenced by private sector development, industrial development, the government balance, reserves and corruption. By introducing structural shift dummy variables for key announcements of progress in EU accession we show that announcements have impacted directly upon FDI receipts but have not influenced country credit ratings. The Agenda 2000 announcement by the European Commission induced a bifurcation between the 'first wave' transition countries and the remainder of our sample. The underlying dynamics of the process illustrate that increases in FDI improve country credit ratings with a lag, hence increasing future FDI receipts. Consequently we suggest that the accession progress has the potential to induce virtuous cycles for the frontrunners but may have serious consequences for the accession laggards.foreign direct investment, EU accession, transition economies

MARKET REFORMS VERSUS STRUCTURAL REFORMS IN RURAL CHINA

This paper adds to the debate on the impact of market reforms versus structural reforms in explaining agricultural output growth in China. A multiple-output stochastic frontier and a technical inefficiency equation are estimated using provincial data on the rural economy from 1986 to 1995. Grain self-sufficiency policies and incomplete market reforms in the 1980s and 1990s led to allocative inefficiency. Agricultural disinvestment shrunk the production frontier and the fragmentation of land holdings reduced technical efficiency. China's rural economic reform is far from being complete.Agricultural and Food Policy, O47, Q12, Q15,

A Question of Choice

A Review of A Question of Choice by Sarah Weddingto

An ab initio path integral Monte Carlo simulation method for molecules and clusters: application to Li_4 and Li_5^+

A novel method for simulating the statistical mechanics of molecular systems in which both nuclear and electronic degrees of freedom are treated quantum mechanically is presented. The scheme combines a path integral description of the nuclear variables with a first-principles adiabatic description of the electronic structure. The electronic problem is solved for the ground state within a density functional approach, with the electronic orbitals expanded in a localized (Gaussian) basis set. The discretized path integral is computed by a Metropolis Monte Carlo sampling technique on the normal modes of the isomorphic ring-polymer. An effective short-time action correct to order $\tau^4$ is used. The validity and performance of the method are tested in two small Lithium clusters, namely Li$_4$ and Li$_5^+$. Structural and electronic properties computed within this fully quantum-mechanical scheme are presented and compared to those obtained within the classical nuclei approximation. Quantum delocalization effects are significant but tunneling turns out to be irrelevant at low temperatures.Comment: 11 text pages, 7 figures, to be published in J. Chem. Phy

Hybrid Quantum and Classical Mechanical Monte Carlo Simulations of the Interaction of Hydrogen Chloride with Solid Water Clusters

Monte Carlo simulations using a hybrid quantum and classical mechanical potential were performed for crystal and amorphous-like HCl-water(n) clusters The subsystem composed by HCl and one water molecule was treated within Density Functional Theory, and a classical force field was used for the rest of the system. Simulations performed at 200 K suggest that the energetic feasibility of HCl dissociation strongly depends on its initial placement within the cluster. An important degree of ionization occurs only if HCl is incorporated into the surface. We observe that local melting does not play a crucial role in the ionization process.Comment: 14 Latex pages with 4 postscript figures, to appear in Chem. Phys. Let

The Determinants of Privatised Enterprise Performance in Russia

Using data from a large enterprise-level panel designed to address this issue, we account for enterprise performance in Russia. We link performance to four aspects of the economic environment: enterprise ownership; corporate governance; market structures and competition; and financial constraints. We conclude that private ownership and improved performance are not correlated, though restructuring is positively associated with the competitiveness of the market environment. These findings on private ownership support those of previous studies, e.g. Earle and Estrin (1997). Moreover, we find evidence that financially unconstrained firms are better in their undertaking of restructuring measures then financially constrained firms. Further analysis suggests that causality runs from restructuring to financial constraint, rather than the reverse. Finally, our findings indicate strong complementarities between the four factors influencing improved company performance, confirming the view that these factors need to be considered jointly.Privatisation, enterprise performance, competition, corporate governance, investment