Microeconomic Aspects of Economic Growth in Eastern Europe and the Former Soviet Union, 1950-2000

The theme of this paper is the microeconomics of economic growth in Central and Eastern Europe (CEE) and the Newly Independent States (NIS) over the period 1950-2000. The key structural change in this region is the end of the socialist regime in 1989 and 1992, and the subsequent attempt at transition to a market economy. We begin the paper with an examination of the key legacies from the socialist period. We then examine the key microeconomic actors in transition economies: households, enterprises, and government officials. Although there are many common processes at work, differences in economic performance tend to coincide with the geographical divide. Legacies play an important part. We also argue that differences in openness also plays an important role in generating different outcomes. These factors, combined with defects in the political and legal system, have given rise to a vicious circle of resistance to reform in the NIS.http://deepblue.lib.umich.edu/bitstream/2027.42/39732/3/wp348.pd

A Model of Russia's "Virtual Economy"

The Russian Economy has evolved into a hybrid form, a partially monetized quasi-market system that has been called the virtual economy. In the virtual economy, barter and non-monetary transactions play a key role in transferring value from the productive activities to the loss-making sectors of the economy. We show how this transfer takes place, and how it can be consistent with the incentives of economic agents. We analyze a simple partial-equilibrium model of the virtual economy, and show how it might prove an obstacle to industrial restructuring and hence marketizing transition.http://deepblue.lib.umich.edu/bitstream/2027.42/39701/3/wp317.pd

Stability and Disorder: An Evolutionary Analysis of Russia's Virtual Economy

The hybrid system that the Russian transition has evolved into has been called the virtual economy. This paper analyzes the evolution of the virtual economy. We pay particular attention to the interaction of economic reform policies and the adaptive behavior of enterprise directors. We then analyze the implications of the virtual economy for Russia's stability and development, and place the evolution of the virtual economy into the larger international security context.

Reputation and the Soft-Budget Constraint

We study the role of reputation in dealing with the soft-budget constraint. We examine whether the reputation of a borrower can lead to repayment in an environment where enforcement is weak. We also introduce lenders’ reputation and examine how this impacts on the allocation of borrowers. We find that reputation can harden budget constraint and improve welfare, although it can never fully eliminate softness. We also show that lenders who acquire a reputation for being tough can earn higher profits than lenders with reputations for being soft.

Microeconomic Aspects of Economic Growth in Eastern Europe and the Former Soviet Union, 1950-2000

The theme of this paper is the microeconomics of economic growth in Central and Eastern Europe (CEE) and the Newly Independent States (NIS) over the period 1950-2000. The key structural change in this region is the end of the socialist regime in 1989 and 1992, and the subsequent attempt at transition to a market economy. We begin the paper with an examination of the key legacies from the socialist period. We then examine the key microeconomic actors in transition economies: households, enterprises, and government officials. Although there are many common processes at work, differences in economic performance tend to coincide with the geographical divide. Legacies play an important part. We also argue that differences in openness also plays an important role in generating different outcomes. These factors, combined with defects in the political and legal system, have given rise to a vicious circle of resistance to reform in the NIS.

Stability and Disorder: An Evolutionary Analysis of Russia's Virtual Economy

The hybrid system that the Russian transition has evolved into has been called the virtual economy. This paper analyzes the evolution of the virtual economy. We pay particular attention to the interaction of economic reform policies and the adaptive behavior of enterprise directors. We then analyze the implications of the virtual economy for Russia's stability and development, and place the evolution of the virtual economy into the larger international security context.http://deepblue.lib.umich.edu/bitstream/2027.42/39660/3/wp276.pd

Russian Federation - The myth of monopoly : a new view of industrial structure in Russia

Discussion of economic reform in the Russian Federation is colored by the conventional view of Russia's industrial structure. Both in Russia and in the West, Russian industry is characterized as very large enterprises operating in highly concentrated industries. The authors challenge the conventional view. They assess Russian industrial concentration by comparing the Russian industrial structure (as revealed in the 1989 Soviet Census of Industry) with that in the United States and other countries. They find that very large firms are more prevalent in the United States than in Russia. This empirical fact suggests that planners economized on the costs of central economic coordination not by building unusually large enterprises, but by not building very small enterprises. Their most important finding: that there is little aggregate or industry concentration at the national level in Russia. Monopolies and oligopolies actually account for only a small share of national employment and production. Instead, barriers to competition in Russia arise as a result of highly segmented product markets. In large part, this segmentation can be viewed as a legacy of central planning. Under the prior regime, enterprises were highly isolated, divided alone both ministerial and geographical lines. Presently, these barriers are reinforced by some features of the transitional environment that continue to undermine the efficient distribution of goods. The authors conclude that the traditional policy remedies appropriate for problems of concentration (such as antitrust policy and import competition) may be ill-advised or inadequate for addressing problems of imperfect competition in the Russian economy. They argue instead that improving the distribution system and other market infrastructure that supports trade and facilitating the entry of new firms should be the most critical elements of competition policy in Russia.Microfinance,Small Scale Enterprise,Private Participation in Infrastructure,Banks&Banking Reform,Water and Industry

Assessment of Subjective Experiences of Boys Entering the Community From a Correctional School

The purpose of this study was to explore, classify, and evaluate the personal experiences of juvenile offenders following release from a state training school. During a two month period beginning in the fall of 1967, a group of twenty-three releasees from the MacLaren School for Boys in Woodburn, Oregon were interviewed on a weekly basis in the Portland metropolitan area. The boys, ranging in age from thirteen to seventeen were contacted in their homes, schools, and other settings to learn of positive, negative, and critical experiences encountered in the community. Open ended questions based upon a twenty- seven item schedule were administered to the boys, focusing upon personal experiences in six major areas: school, family, peer group, community, work and authority. Responses were recorded verbatim and classified according to the boys\u27 judgments of positive and negative connotations. Critical experiences were also recorded to determine specific incidents which brought the boys into contact with legal authorities or otherwise seriously affected their parole status. Positive, negative, and critical experiences from this study were analyzed both descriptively and statistically. Null hypotheses were tested to determine the quality, quantity, and intensity of experiences with respect to such major variables as age of the boys, race, length of stay in the community, records of school attendance, and personality inventory characteristics. Experiences were similarly related with respect to other variables found to be present as a result of the interviewing experience. Findings yielded evidence to indicate a predominance of negative experiences in the boys’ contacts with the community following release. The highest proportion of these occurred within the boys’ families, followed by contacts with authority and school, respectively. Peer group relationships for the boys indicated the highest proportion of positive experiences when compared with other major categories

Empathy: a review of the concept

The inconsistent definition of empathy has had a negative impact on both research and practice. The aim of this article is to review and critically appraise a range of definitions of empathy and, through considered analysis, to develop a new conceptualisation. From the examination of 43 discrete definitions, 8 themes relating to the nature of empathy emerged: “distinguishing empathy from other concepts”; “cognitive or affective?”; “congruent or incongruent?”; “subject to other stimuli?”; “self/other distinction or merging?”; “trait or state influences?”; “has a behavioural outcome?”; and “automatic or controlled?” The relevance and validity of each theme is assessed and a new conceptualisation of empathy is offered. The benefits of employing a more consistent and complete definition of empathy are discussed

Investigating the role of two types of understanding in relationship well-being: Understanding is more important than knowledge

Understanding is at the heart of intimate relationships. It is unclear, however, whether understanding-partners' subjective feeling that they understand each other-or knowledge-partners' accurate knowledge of each other-is more important for relationship well-being. The present article pits these two types of understanding against each other and investigates their effects on relationship well-being. In a prospective study among 199 newlywed couples, partners' self-reported and perceived understanding and their knowledge in different domains were assessed. Understanding was independent of knowledge. Self-reported and perceived understanding predicted relationship well-being but neither type of knowledge did. Thus, subjectively feeling that one understands and is understood by one's partner appears to be more important to relationship well-being than actually knowing and being known by one's partner. © 2009 by the Society for Personality and Social Psychology, Inc