Efter upplösningen av Sovjetunionens starka maktkontroll över sina satellitstater den 9:e november 1989, kunde de Centrala och Östeuropeiska länderna (förkortning CEEC på engelska) påbörja sin övergång till marknadsekonomi. Sättet att närma sig en fri marknad är indelat i två olika tillvägagångssätt – chockterapi och gradualism. Den förstnämda metoden genomförs med fokus på snabbhet och en samverkande engångsförvandling av de ekonomiska sektorerna medan den sistnämnda beaktar en grad- och stegvis omvandling. Omvandlingsprocessen i sig består av flera variabler, exempelvis privatisering av statligt ägd egendom, makroekonomisk stabilitet samt liberalisering av priser och handel. Beroende på vilken metod som valdes genomfördes de ovan nämnda variablerna vid olika tidpunkter och med varierande hastighetsgrad. Åsikterna bland ekonomer rörande vilken metod som uppnått bäst resultat är omdebatterad. Följaktligen är syftet med denna uppsats att undersöka vilken av omvandlingsmetoderna som har uppnått högst BNP per capita tillväxt i de valda CEEC under perioden 1992-2003. Tio CEEC valdes ut för att få en rättvis delning mellan de två tillvägagångssätten, med tillhörande fem länder i varje grupp. Därtill valdes fem referensländer ut, för att i en grafisk analys kunna relatera utvecklingen i omvandlingsländer till redan etablerade marknadsekonomier. De erhållna resultaten visar att val av tillvägagångssätt inom omvandlingsprocessen inte har någon signifikant inverkan på BNP per capita utvecklingen. Ländernas grundförutsättningar samt i vilken ordning variablerna implementerades visar sig troligen ha större inverkan på BNP per capita tillväxten. Dessutom visar de empiriska resultaten klara indikationer på att det finns en skillnad mellan CEEC och referensländerna. / After the resolution of the Soviet Unions strict control over its satellite with beginning on the 9th of November 1989, the Central and Eastern European Countries (CEEC) began their transition towards a market economy. How to approach the economic system of a free market has been divided into two major policies – shock therapy and gradualism. The first policy is implemented with speed and one-shock change within the economic sectors as a focus while the second constitutes of slow and gradual implementations. The transformation process in itself consists of several variables, for e.g. privatization of state-owned properties, macroeconomic stabilization and liberalization of prices and trade. Depending on what policy chosen, the variables were implemented at different times and with different speed. The views among economists regarding which of the two models that achieve the best result when transforming differs widely. Hence, the purpose of this thesis is to investigate which of the two models that have had the best effect upon the GDP per capita growth in the chosen CEEC. Ten CEEC were picked to have a fair representation for each policy, with five countries representing each policy group and the years measured were 1992-2003. In addition, for a graphical analysis to be performed and to distinct CEEC from already established market economies, five reference countries were included. The results obtained indicate that the policy choice has no impact on average GDP per capita growth. Instead we concure with earlier research that claim that preconditions and sequential order of the market reforms have a larger impact on GDP per capita growth. Additionally, empirical results indicated that there is a significant difference in the GDP growth over the last decade between our CEEC and the reference countries.

Income inequality and its relationship to long-term GDP per capita growth has been researched for decades since the development of the Kuznet’s Curve. Theoretical and empirical research has shown mixed results including positive, negative, non-existent, or statistically insignificant relationships. Empirical research on income inequality and economic growth in the United States has also shown mixed results. In addition to using existing data, this paper uses originally-constructed Gini Coefficients from 2005 to 2009. A statistically significant negative correlation between income inequality, and both short-term growth and long-term growth is found in the analysis of this data. Finally, this paper attempts to justify a causal relationship between income inequality and long-term growth.

India does not fit easily into existing models of thought on the nature of a state and defies ease of understanding. Though India is most often considered to be a subsidy state, I show in this thesis the notion of the subsidy state does not capture the true nature of the Indian state. Chapter two of the paper looks at various models of understanding the nature of the Indian state and draw out three essential features: competing interest groups, how economic liberalization facilitates corruption and works against India’s aim of equalizing the capabilities and freedoms of all its citizens, and the role of the Indian state in development and how the failure to engage its citizens in the process has resulted in the current system. Chapter three looks at subsidies and cash transfers, discussing the problem of targeting and the design of programs. The fourth chapter, I share the methodology I used to categorize 581 centrally sponsored schemes. I did this to be able to disaggregate centrally sponsored schemes. For each scheme, I identified the state associated with each scheme, the target groups (intended beneficiaries) of each scheme, the types of benefits delivered, whether the receipt of the benefits were conditional or not, and the relevant policy areas of each scheme. I concluded that a closer look at the Indian state reveals that India may actually be more accurately identified as a developmental state which facilitates the enhancement of its citizens’ capabilities and freedoms.

In this paper, I study the effect of foreign direct investment (FDI) on a group of host country economic growth for the period 1994-2011. Using aggregate level FDI data for a group of five emerging countries, the paper reveals that FDI has a positive effect on economic growth. Then I use sectoral data and test whether all the sectors have positive effects on growth. The results vary across the sectors. The results seem to be positive for mining and quarrying as well as manufacturing sector, while trade and financial intermediation sectors to have a negative effect on economic growth.

Economic growth in a country can be explained by numerous variables, both positive and negative. Increasing levels of education, investment and openness are examples of factors generally believed to have positive effects on the economic progress, while corruption is one of the factors often regarded as detrimental to economic growth. The purpose of this thesis is to measure and analyze if the levels of perceived corruption in a cross-section of countries have affected their economic growth rates over the years 2004-2008. The study is carried out with four regressions on a sample of 123 countries and eight variables for the time period in question. The models are constructed on the basis of both the neoclassical growth theory and the endogenous growth theory. The found result contradicts the expected outcome; it shows that the perceived levels of corruption are significantly and positively correlated with economic growth. It is however found that countries with widespread corruption, in general developing countries, have experienced high economic growth over these years. A correlation the authors argue can explain the unexpected sign of the corruption variable.

This paper examines the impact of financial sector foreign direct investment (FSFDI) on economic growth by estimating a panel data model for 11 Central and Eastern European countries (CEECs) between 1996 and 2003 in a cross-country growth accounting framework. The analysis concentrates on the efficiency channel linking FSFDI to economic growth. The results clearly indicate that there can be a relationship between FSFDI and economic growth. Approaching a medium degree of financial M&A is rewarded by higher economic growth after two periods. Beyond it, FSFDI seems to spur economic growth depending on a higher human capital stock. FSFDI-induced knowledge-spillovers to domestic banks can be an explanation for this phenomenon. Above a certain threshold, the crowding-out of local physical capital caused by the entry of a foreign bank seems to hamper economic growth. The value of the paper lies in (1) providing novel data on FSFDI in CEECs, (2) analyzing the impact of FDI on a sectoral level and (3) in modeling the hitherto only qualitatively discussed relationship between foreign banks and economic development into a structural, econometric model that combines two streams of economic research: the FDI-growth-literature and the finance-growth-literature. (author's abstract) / Series: EI Working Papers / Europainstitut

This paper uses the panel data of 11 OECD countries over a period from 1971 to 2006. Unlike the traditional cointegration model which omitted the impact of structural breaks in the analysis, this paper applies panel cointegration with structural break test proposed by Westerlund (2006), panel unit root test, and panel dynamic OLS test. The empirical results indicate that health care expenditure and economic growth (GDP per capita) are non-stationary in the series; and between the two variables, a long-term cointegration relationship exists. Moreover, a positive correlation between HCE and economic growth is found in the panel dynamic OLS model. The researcher concludes that investing in health capital improves human capital and that boosts economic growth in the sample countries, and vice versa. More importantly, allowing structural breaks in the cointegration analysis obtains reliability in the estimation and proves more detailed and specific information on the consequence of the momentous events on the two variables; and thus enables policy makers and health economists to propose more effective strategies.

This dissertation comprises two topics. In Chapter 1, I explore the short- and long-run relation between insurance development and economic growth for 40 countries between 1981 and 2010. Applying a pooled mean group estimation, I find that life and nonlife insurance have different short- and long-run effects on the growth. On a full sample analysis, life insurance exerts a significantly positive long-run effect on the growth, while its short-run effect is not significant. Nonlife insurance, in contrast, has a significantly positive short-run growth effect but no long-run effect. On a reduced sample analysis, the observation on life insurance is qualitatively similar, but the growth effect of nonlife insurance is no longer significant both in short and long run, suggesting that specific countries drive the overall effect in the full sample. The results pass a battery of robustness tests. The analysis on individual countries reveals that the short-run effect and adjustment speed toward the long-run equilibrium varies across countries. I also analyze if the level of income and insurance development makes any difference on the growth effect of insurance. The results show that the growth effect of life insurance is significant in non-high income countries and countries with low level of life insurance development, while the effect is not significant both for life and nonlife insurance in high income countries. In Chapter 2, I employ the dynamic panel threshold model to investigate how institutional environments shape the impact of insurance development on economic growth. I conduct four hypotheses for possible intermediate effects of institutional environments on insurance-growth nexus: quasi-institution positivity, quasi-institution negativity, quasi-institution duality, and quasi-institution neutrality. I use multiple measures related to political, economic, and legal environments to evaluate the soundness of institutional environments. Empirical results show that the quasi-institution negativity hypothesis is supported for life insurance because the observation is consistent across all institution-related measures. The results in nonlife insurance are not as uniform as those in life insurance. The quasi-institution positivity, negativity, and neutrality are respectively supported in different institutional measures, and the coefficients in most cases are significant only at a marginal significance level. The overall findings suggest that a sound institutional environment does not necessarily benefit the growth effect of life insurance, but an unhealthy one does deter it and that the effect depends on specific measure in the case of nonlife insurance. In Chapter 3 I briefly introduce some directions for further research.

This study aims to investigate the direction of the relationship between financial deepening and economic growth after the completion of financial liberalization in Turkey. In order to do this, an unbalanced panel data set of 49 OECD and emerging countries for 1953-2005 period is examined with Granger causality and panel data estimation techniques. In the light of panel data analysis results, quarterly Turkish time series data for 1987-2006 period is examined by using Granger causality, cointegration and Vector Error Correction Model (VECM) procedures. Although the unbalanced panel data analysis reveals a relationship that is from financial deepening to economic growth, country specific Granger causality analysis employed with the panel data gives the opposite relationship for Turkey. Moreover, it is observed that quarterly time series data analysis mainly gives a relationship that is from economic growth to financial deepening.

Transportation planners are often faced with the problem of estimating passenger and freight flows between regions. In the literature there are many models for passenger flows. However, models about freight flows are more limited. Modeling freight flow is also more complex than modeling passenger flow and there are many agents related with freight flows. In addition, data availability is a critical factor. In this research, freight flows between provinces in T&uuml / rkiye are forecasted by demand analysis. Transportation is one of the important activities of human beings and plays an important role for spatial interactions in economic growth. In other words, there is a very strong linkage between economic growth and the freight flow, thus transportation demand. Regional trade as spatial flow appears on transportation systems as freight flows. In this study, using the existing limited data and surveys in T&uuml / rkiye, nationwide origin-destination (O-D) matrix of freight flows between provinces is obtained. Using this empirical matrix, the generation of freight flows of provinces is formulated depending on the socioeconomic and demographic variables by means of multiple linear regression analysis. In addition, interactions of freight flows between provinces and economic growth of regions are investigated. The generations and attractions of provinces as freight flow are distributed between provinces with traditional gravity model. By comparing observed O-D matrix and simulated O-D matrix, gravity model is calibrated. Calibration is also performed by freight trip length distribution. In this research, two steps of traditional &ldquo / four-step analysis&rdquo / , &ldquo / trip generation&rdquo / and &ldquo / trip distribution&rdquo / , are applied to develop nationwide freight demand model between the provinces in T&uuml / rkiye. The developed model is single-mode, single commodity and nationwide.