Past theoretical research has explored whether bribes paid by firms to government officials are greater under a decentralized bureaucracy where the firm faces numerous government officials or under a monopolistic one. Presumably, bribes are bid down in the former as officials compete for bribes. However, a tragedy of the commons could occur where decentralized officials "overgraze" and charge higher bribes than a single bureaucrat would. Using the BEEPS I, a firm level survey covering 24 transition countries, the chapter 1 examines whether reported bribe payments by firms are higher when firms face numerous officials or only a single one. We find that bribe payments are higher under a more decentralized bureaucratic structure. In chapter 2 we investigate the link between private market competition and bribery. Greater competition could lower profits thereby limiting the amount corruption since rents are lower but greater competition could also provide more incentives for firms to pay bribes to obtain advantages over their rivals. We consider bribes to obtain government contracts. Using the BEEPS III dataset on 27 transition countries and the Censored Quantile Regression methodology we empirically found that as the number of competitors increases the amount bribes paid tend to increase as well. We also found that this relationship follows an inverted U. The marginal effect increases with the amount of bribes paid up to a maximum, then decreases, but remains positive. We believe that this relationship is driven by more competitors raising demand for these contracts. In chapter 3 we investigate the association between corruption and two types of investment. Past research focuses only on the total level of investment. Using the same dataset as used in chapter 2, we obtain mixed results. Using a tobit model, we find evidence that corruption "greases the wheels" of physical investment but has no significant effect on the level of R&D investment. However, results from a probit model suggest that corruption does negatively impact whether or not the firm undertakes R&D. These findings indicate corruption can affect not only the level but also the decision of whether to invest. They also show that these effects might differ across the type of investment so that the "grease wheels" and "sand wheels" perspectives are not incompatible as most the studies using the aggregate level of investment tend to imply.

The world experiences large-scale ecosystems degradation in an every part of the planet - in rich as well as in and poor parts. Unstable economic conditions together with weak law enforcements make low income countries face more severe forms of natural destruction. This draws the attention on the need to design economic policies that are environmentally sound and while at the same time ensuring the well-being of their inhabitants in economic, social and natural settings. A number of countries in Central and Eastern Europe and Central Asia have experienced a unique historical period of transition from communist regimes to free democratic societies. This has been followed by numerous effects on their financial situations as economic hardships caused by the collapse of economies injected by the assistance from the Soviet and committees of socialist countries mutually aiding each other, opening up of opportunities as private ownership and market liberations. Not all countries succeeded in liberalizing their economic structures and reforming economic and political environments. Simultaneously, the natural environment underwent various effects, both positive and negative, after the Iron Curtain fell and exposed destructing effects of command and control economy. Mongolia has experienced all the hard aspects of the transition and started to climb up on the income ladder from the low income to the lower middle-income list of the World Bank, but also seen many negative price aspects of development. Water resources have been severely degraded in recent years due to anthropogenic impact. However, there are reforms taking place in water sector institutions that have recently attracted wide attention nationwide.This thesis will give detailed picture on current state of water resources in the country and the system that coordinates them. The Environmental Kuznets Curve (EKC) is used as an approach to highlight the relationship between water resource quality and income per capita in Mongolia. This is followed by a detailed discussion on water institutions development and the coordinating mechanisms badly needed among sectors involved. The research suggests that collaborative actions are important if sustainable water management is to be reached. More generally, I recommend further research issues on the generated topic as my thesis is one of the first discussions coupling the EKC and institutional theory aspects together.

We investigate the role of leasing in the lending boom in Central and South Eastern Europe (CEE and SEE). We contribute by (1) providing a full picture of the financing situation in Eastern Europe, where leasing plays a more important role than elsewhere; (2) by investigating the finance-growth-nexus for ten Eastern European countries with a panel data approach over 1999-2006; (3) by extending the production function approach (credit, stock, bond) and the law-and-financeview for leasing. We find that leasing and credit positively contributed to economic growth. However, leasing and credit are complements and not substitutes as suggested partly by previous research in other regions. We conclude that leasing cannot be used to circumvent proper regulation by policy makers or market participants, and that alternative forms of finance need to be included for a full picture of the finance-growth link. / Series: EI Working Papers / Europainstitut

Several studies have been published postulating the emergence of the post-modern research system, the research system in transition and the new production of knowledge (Cozzens et al. 1990, Rip and van der Meulen 1996, Gibbons et al. 1994). However, these studies have been largely concerned with the gradual transformation of well-established research systems of Western industrialised countries. The radical transformations of the research systems of Central and Eastern European countries (CEE), following the collapse of the communist regime at the beginning of the 1990s, have attracted a smaller number of scholars (Balazs et al. 1995; Schimank 1995; Radosevic 1999; Dyker and Radosevic 1999, 2000). Prior to this, the developments in scientific organisation have been considered to be either an issue of evolution (in advanced or industrialised countries) or, as in the case of developing countries - a development issue. However, the research/innovation systems of CEE in the 1990s were neither underdeveloped, nor following the pattern of evolution of other industrialised countries, but were forced to change as a consequence of changes in the political and economic order. Furthermore, eighteen years after the fall of the communist regime, the research systems of CEE have developed at different rates, along different trajectories, despite similar preconditions for change. Taking into account the aforementioned considerations, the study investigates two research systems in transition, those of Latvia and Estonia, which along with the Czech Republic have initiated the most radical reorganisation of their research systems. The choice of countries is based on the realisation that despite, at first glance, similar pre-conditions for change, as well as similar demographic factors, political and economic systems, and institutional structures of scientific organisation (which makes these countries easily comparable); these systems appear to have evolved along different trajectories. Clear differences are seen in terms of total state funding allocated for research, as well as contributions from the private sector, R&D intensity, research output in terms of publication, citation rates and patents, collaborative projects and publications (Kristapsons, Martinson and Dagyte 2003). Based on these indicators, Estonia precedes Latvia on all counts; possible explanations for this are the diversified funding mechanisms available, and the multitude of assessments of research and development on the basis of which policies were formed (Kristapsons, Martinson and Dagyte 2003).In view of the overall goal of explaining different rates/paths of development of similarly positioned national research systems, the purpose of the study is twofold. Firstly, it attempts to paint a comprehensive picture of the Latvian and Estonian research systems and, secondly, it compares and contrasts them in terms of the reforms initiated and the outputs, outcomes and impacts of these reforms. Methodologically, the study is largely qualitative in nature and it has been deemed appropriate to present the two countries as separate case studies, yet retaining a common analytical frame to gather primary and secondary data. Secondary data has been collected by drawing on the multitude of archival and documentary evidence and statistical databases available; primary data was collected by conducting semi-structured interviews.

Current research examines the interdependence between foreign direct investment (FDI), financial development and economic growth. The relationship between the variables in question is studied with reference to transition economies (28 former centrally planned economies). The period of observation covers the transition from centrally planned to market economies 1989-2007. The relationship is analysed using panel data regression models, factor analysis and cointegration tests. The paper suggests that FDI and financial development exert a complementary effect on economic growth, although the latter appears to be insignificant. At the same time, the research provides evidence that FDI is likely to compensate the underdevelopment of financial sector. Powered by TCPDF (www.tcpdf.org)

This master thesis is intended as a contribution to the understanding of the influencestructural changes has on urban transformation in housing domain, by focusing onmechanisms behind the upgrading as accidental model for regeneration of the collectivehousing. In particular, the aim is to do so in relation to a comparison between differentoperational scales on which process is carried out. The process is investigated at the city,neighborhood and street/square scale. With the use of qualitative methods, such asinterviews, in depth analysis of policies and regulations and observations, differences inmanifestation of the regeneration on different scales are discovered. It is suggested thatundefined strategy, indifferent attitude of local authorities, inconsistent legislativeenvironment, disconnection between the operational scales and presence of the market asessential driving force of the process, results in asymmetric outcomes of upgrading, both inphysical and social terms. But on the other hand, in respect to wider political and economicalenvironment in which regeneration happened, it is acknowledged that considerable housingstock is renovated and living standards are improved. The most critical issue in the process isproved to be the uneven awareness of the importance of the regeneration among the actorsat different scales and consequently their performance in respect to it. Furthermore,influence of upgrading on the community life and social relation in the regeneratedneighborhoods are totally neglected, which has for its consequences decreased use ofcommon space between the buildings and erosion of existed communities. It is proved alsothat fully market driven regeneration has rather regressive consequences on urbantransformation in context of Nis but in same time gives valuable lessons for improvement ofthe future upgrading as regeneration model for collective housing. Based on these lessons,adaptive policy changes are suggested and platform for further studies in system or processoriented urban regeneration and design is established. Thesis is organized as follows: firstmethodological approach is explained, second it situate problem in wider regional and localcontext in respect to urban transformation and housing trends, third thesis discuss analysisof operational scales and conclude with final cross-scale discussion and potentials for furtherresearch.

The thesis explores the effect of fiscal decentralization on local governments budgeting and fiscal autonomy in selected transition countries of Central and Eastern Europe. The implications of legislative changes on local budgets and revenue authority are analyzed. Discrepancies between legal provisions and actual fiscal practices are identified on the basis of case studies of four countries: Bulgaria, Georgia, Hungary, and Lithuania. The study explores some specific approaches to dealing with local finances based on the respective countries' fiscal legislation. An attempt is made to evaluate local revenue authority based on both comparable statistical data and legal provisions of the selected countries. Following a comparative conceptual framework, the thesis reveals both unique and common patterns of budget policy and local revenue raising authority in each of the four countries. The results of the inquiry indicate that despite the greater fiscal authority and independence which local authorities gained during the transition, local governments in many CEE countries continue to operate within old centralized fiscal structures and budget policies. The right balance between the need for decentralization of governance and the ability and desire of local authorities to control and steer the local revenue policies is still to be found. / Master of Urban and Regional Planning

This dissertation examines from a comparative perspective the growth experience for a sample of twelve countries of the former Soviet Union over the period from 1991 to 2008. Two meth- ods of econometric analysis are applied: cross-section regressions and dynamic panel data esti- mation techniques. The main focus of the study has been to empirically establish whether coun- tries in the region are converging or diverging in terms of their income per capita and to find important sources of cross-country differences which determine the shape of this process. I did not find statistically significant support for conditional convergence in any cross-section period. It is partly supported by the increased dispersion of per capita income levels during the sample period. Meanwhile, panel data fixed-effects and GMM methods provide strong support for con- ditional convergence hypothesis. The first-differenced GMM estimator indicates a rate of con- vergence of around 2 per cent a year, which is surprisingly similar to the standard cross-section findings in empirical literature. However, it could be the result of the cyclical behaviour of out- put during transition. In general, results indicate that structural transformation is not yet over in most of the countries. Therefore progress in market-oriented reforms and...

This thesis focuses on the development of credit to the private sector in the Central and Eastern European (CEE) countries. Although the speed of credit growth in these countries has recently slowed down as the consequence of the global financial crisis, the overall increase in credit to the private sector over the past decades has been immense. As a result, the thesis examines whether this substantial increase in credit is linked to the convergence of the CEE countries towards the equilibrium or whether it represents an excessive credit growth that could threaten the macroeconomic and financial stability in these countries. We estimate the equilibrium credit levels for 11 transition countries by applying a dynamic panel data model. Since in-sample approach may bias the estimation results we perform the estimates out-of-sample using a panel of selected developed EU countries as a benchmark. The difference between the actual and estimated credit-to-GDP ratios serves as a measure of private credit excessiveness. The results indicate a slightly excessive or close to the equilibrium credit-to-GDP ratios in Bulgaria, Estonia, and Latvia prior to the financial crisis. With regard to the significant decline in GDP during the crisis this measure of credit excessiveness in these countries have further increased.

This report describes the aim, scope, underlying literature and results of the research project "The Nexus between the Financial and the Real Sector". We studied the contribution of the financial sector as a whole and its individual segments (bank credits, the issuance of bonds and shares) to real economic growth in EU Member and Candidate Countries, the United States and Japan. We supplement existing approaches with the inclusion of the bond market and of foreign direct investment in the banking sector, wherein for the first time, we provide empirical evidence for slightly positive effects thereof. Methodically, we extend previous research by the production-function approach and document the importance of the market microstructure. We recommend to include liberalisation and integration effects, the bond and insurance sector, and effects of foreign bank entry and investment into future research on the Finance-Growth-Nexus. (author's abstract) / Series: EI Working Papers / Europainstitut