Better means more: property rights and high-growth aspiration entrepreneurship

This paper contrasts the determinants of entrepreneurial entry and high-growth aspiration entrepreneurship. Using the Global Entrepreneurship Monitor (GEM) surveys for 42 countries over the period 1998-2005, we analyse how institutional environment and entrepreneurial characteristics affect individual decisions to become entrepreneurs and aspirations to set up high-growth ventures. We find that institutions exert different effects on entrepreneurial entry and on the individual choice to launch high-growth aspiration projects. In particular, a strong property rights system is important for high-growth aspiration entrepreneurship, but has less pronounced effects for entrepreneurial entry. The availability of finance and the fiscal burden matter for both

Continuity over change: Belarus, financial repression and reintegration with Russia

This chapter examines the case of Belarus, focusing primarily on developments in its financial sector and its strategy of integration into the global economy. It reviews the initial shocks that all transition economies face at the beginning of transformation and describes patterns of transition. The chapter discusses the political reasons for introducing financial repression in Belarus and the subsequent politicization of economic-policy making in Belarus. It looks at the divergent post-communist pathway of Belarus by investigating its strategy of integration into the global economy, and outlining further perspectives on the development of the country. Under the Soviet system Belarus was the country’s 'industrial assembly plant’ specializing in the production of assembled goods, rather than the production of raw materials or services. A two-tier banking system was established at the end of 1990 with the enacting of both the 'Act on the National Bank of Belarus’ and the 'Act on Banks and Banking Activity in the Republic of Belarus’

NATO: the view from the East

Relations between Russia, Ukraine and Belarus and NATO have placed more emphasis on cooperation than confrontation since the Cold War, and Ukraine has begun to move towards membership. At the popular level, on the evidence of national surveys in 2004 and 2005, NATO continues to be perceived as a significant threat, but in Russia and Ukraine it comes behind the United States (in Belarus the numbers are similar). There are few socioeconomic predictors of support for NATO membership that are significant across all three countries, but there are wide differences by region, and by attitudinal variables such as support for a market economy and for EU membership. The relationship between popular attitudes and foreign policy is normally a distant one; but in Ukraine NATO membership will require public support in a referendum, and in all three cases public attitudes on foreign policy issues can influence foreign policy in other ways, including the composition of parliamentary committees. In newly independent states whose international allegiances are still evolving, the associations between public opinion and foreign and security policy may often be closer than in the established democracies

Entrepreneurial dynamics and higher education institutions in the post-communist world

This study draws on the institutional and regional entrepreneurship literature to develop a conceptual framework that analyses the impact of higher education institutions on entrepreneurial dynamics. It is used to examine the cities of the Commonwealth of Independent States (CIS) during the period 1995–2008. Extending the multi-pillar institutional concept, it is found that higher education institutions play a prominent role in fostering entrepreneurial dynamics in CIS cities through multiple channels, including human capital development, cultivating a positive attitude towards entrepreneurship, affecting the perceptions of the knowledge and skills needed to start up a successful business, and knowledge spillovers

The Two Disjointed Faces of R&D and the Productivity Gap in Europe

This paper explores the determinants of productivity gaps within the European Union in computing, chemicals, basic metals and food manufacturing – four sectors that vary in terms of the intensity of sectoral R&D. Our analysis reveals that the main causes of these productivity gaps are intensity of unembodied or disembodied R&D activity and R&D embodied in purchased equipment and machinery, and their interplay. While disembodied and embodied R&D are both associated positively to closing productivity gaps, the interaction between the two does not have the same effect. There is no complementarity between these technology acquisition modes, despite both disembodied and embodied technology are crucial for productivity catch up. In a policy context, this suggests possible lack of coordination between R&D policy and technology transfer (that is, foreign direct investment, trade and industrial policy). We show, also, that the productivity gap between ‘peripheral’ (southern and eastern) and ‘north’ EU countries is widening

Start-up financing in the age of Globalisation

We investigate the determinants of start-up financing in 54 countries, using the Global Entrepreneurship Monitor (GEM) surveys for years 2001-2006. We find that financial liberalisation increases the total financial size of the individual start-up entrepreneurial project both via the increased use of external and of own funds. In addition, the volume of start-up finance responds positively to international capital inflows as represented by loans from non-resident banks and remittances, and negatively to the volume of offshore deposits. The positive impact of remittances on total volume of start-up financing is via own finance of the entrepreneur

Technology choices and growth: testing and expanding the propositions of new structural economics in transition economies

We explore the relationship between broad development policies, finance and growth as approached by New Structural Economics (NSE) (Lin, 2012) with special reference to transition economies. On a sample of 164 economies for 1963-2004, our analysis has confirmed Lin’s (2012) conclusions that the type of development policy pursued, as captured by the Technology Choice Index (TCI), has significant effects on long term growth. To complement this finding, we demonstrate a time variant effect of TCI on growth whereby TCI is especially relevant prior to the 1990s (more than prior to the 80s). We also show that the effects of TCI on growth differ for low and middle income countries as compared to high income countries. For the former two groups the relationship is negative and positive for high income countries. Further to this, we also show that there is a significant relationship between financial sector distortions and other economic distortions typical of comparative advantage defying strategies as captured by high values of TCI. These results are especially strong for the 34 countries with the highest TCI values in our sample. We also find that a larger deviation in actual financial structure from its estimated optimal ratio further reinforces the negative effect of TCI on growth. Overall our results offer a strong confirmation of NSE’s propositions regarding the relationship between growth and TCI and TCI and financial development, on average and for the most distorted economies. However, the basic propositions of NSE have not been confirmed as a general case for transition economies (TE). Indeed we find that the relationships investigated do not follow the same patterns for TE as a group, and we further identify different patterns for CEEB countries on the one hand and CIS on the other hand. We propose some possible explanations of why these countries might be behaving differently