Does Social Capital Matter?

Summaries The role of social capital has come to the fore in recent development analysis in which the level of institutional capacity and consequent level o economic development depends on the amount of social capital available. Economies managing transition have revealed weak institutional capacity: social capital is minimal and distrust predominates. A project in southern Albania illustrates the problem of low social capital. Introducing and transferring techniques of participation in decision?making over local economic development enabled the creation of networks and local organisations, beginning the process of social capital accumulation to strengthen institutional development and enhance economic performance

Foreign banks and foreign currency lending in emerging Europe

Based on survey data from 193 banks in 20 countries we provide the first bank-level analysis of the relationship between bank ownership, bank funding and foreign currency (FX) lending across emerging Europe. Our results contradict the widespread view that foreign banks have been driving FX lending to retail clients as a result of easier access to foreign wholesale funding. Our cross-sectional analysis shows that foreign banks do lend more in FX to corporate clients but not to households. Moreover, we find no evidence that wholesale funding had a strong causal effect on FX lending for either foreign or domestic banks. Panel estimations show that the foreign acquisition of a domestic bank does lead to faster growth in FX lending to households. However, this is driven by faster growth in household lending in general not by a shift towards FX lending

Integrating institutional and behavioural measures of bribery

Bribery involves individuals exchanging material benefits for a service of a public institution. To understand the process of bribery we need to integrate measures of individual behaviour and institutional attributes rather than rely exclusively on surveys of individual perceptions and experience or macro-level corruption indexes national institutions. This paper integrates institutional and behavioural measures to show that where you live and who you are have independent influence on whether a person pays a bribe. The analysis of 76 nationwide Global Corruption Barometer surveys from six continents provides a date set in which both institutional and individual differences vary greatly. Multi-level multivariate logit analysis is used to test hypotheses about the influence of institutional context and individual contact with public services, socio-economic inequalities and roles, and conflicting behavioural and ethical norms. It finds that path-determined histories of early bureaucratization or colonialism have a major impact after controlling for individual differences. At the individual level, people who frequently make use of public services and perceive government as corrupt are more likely to pay bribes, while socio-economic inequality has no significant influence. While institutional history cannot be changed, changing the design of public services offers is something that contemporary governors could do to reduce the vulnerability of their citizens to bribery