Breaking out of poverty traps: Internal migration and interregional convergence in Russia
We study barriers to labor mobility using panel data on gross region-to-region migration flows in Russia in 1996-2010. Using both parametric and semiparametric methods and controlling for region-to-region pairwise fixed effects, we find a non-monotonic relationship between income and migration. In richer regions, higher incomes result in lower migration outflows. However, in the poorest regions, an increase in incomes results in higher emigration. This is consistent with the presence of geographical poverty traps: potential migrants want to leave the poor regions but cannot afford to move. We also show that economic growth and financial development have allowed most Russian regions to grow out of poverty traps bringing down interregional differentials of wages, incomes and unemployment rates.
This book focuses on the questions of how territorial differences in productivity levels and unemployment rates arise in the first place and why territorial differences in labor market performance persist over time. Unemployment divergence and unemployment club convergence have been touched on in a large number of works and have recently also been studied using spatial econometric analysis. In this book we aim to develop the debate to include several important new topics, such as: the reasons why structural changes in some sectors cause slumps in some regions but not in others; the extent to which agglomeration factors explain regional imbalances; the degree of convergence / divergence across EU countries and regions; the role of labor mobility in reducing / increasing regional labor market imbalances; the impact of EU and country-level regional policy in stimulating convergence; and the (unsatisfactory) role of active labor market policy in stimulating labor supply in the weakest economic areas.
The paper provides a framework for analysis of optimal growth enhancing policy in the economy with market and government failures. It develops an endogenous growth model with strategic complementarities between R&D investments of firms and investments in training of households. The model generates two possible long-run equilibriums: no-growth poverty trap equilibrium and stable sustainable growth equilibrium. In the extended version of the model with government failures we assume that some part of government revenue is expropriated by rent seeking agents. With these conditions we analyze the possibility of transition from stagnation to growth induced by government investment subsidies and other factors.
In the early twentieth century, a large number of households resettled from the European to the Asian part of the Russian Empire. We propose that this dramatic migration was rooted in institutional changes initiated by the 1906 Stolypin land titling reform. One might expect better property rights to decrease the propensity to migrate by improving economic conditions in the reform area. However, this titling reform increased land liquidity and actually promoted migration by easing financial constraints and decreasing opportunity costs. Treating the reform as a quasi-natural experiment, we employ difference-in-differences analysis on a panel of province-level data that describe migration and economic conditions. We find that the reform had a sizeable effect on migration. To verify the land liquidity effect, we exploit variation in the number of households participating in the reform. This direct measure of the reform mechanism estimates that land liquidity explains approximately 18% of migration during this period.
In this paper, we investigate the consumption Euler equation for the Russian households under Epstein and Zin (1989) preferences. Firstly, we investigate the impact of liquidity constraints and non-tradable assets on the Euler equation, and then use these theoretical results for the estimation and testing. We get the estimate of the elasticity of intertemporal substitution, which is significantly higher than zero and lower than one. We also show that borrowing constraints have a significant impact on the consumption dynamics, while the hypothesis about lending constraints is not supported by the data.
The transition to market economic systems in the countries of Central and Eastern Europe and the former Soviet Union involves fundamental shifts in the sectoral allocation of resources, in particular, dramatic changes in employment structures. Development of services in Russia turns to be more impressive than in many other transitional countries. This paper uses the Baumol-Fuchs model of the service sector expansion to estimate underdevelopment of services in Russia prior the transition and measure the progress in catching-up that has taken place thus far. Based on the Russian Longitudinal Monitoring Survey (1994-2000) empirical analysis demonstrates that sectoral variation in the difference between withdrawal from and entrance to the labor force is the main reason of changing distribution of labor. For job-to-job transitions low quality of current job matches, tenure effects and labor market segmentation are the most important explanation of inter-sectoral labor mobility.
Using two rounds of nationally representative household survey data in this study, we measure the impact on poverty in Nepal of local and international migration for work. We apply an instrumental variables approach to deal with nonrandom selection of migrants and simulate various scenarios for the different levels of migration comparing observed and counterfactual household expenditure distribution. Our results indicate that one-fifth of the poverty reduction in Nepal occurring between 1995 and 2004 can be attributed to higher levels of work-related migration and remittances sent home. We also show that while the increase in international work-related migration was the leading cause of this poverty reduction, domestic migration also played an important role. Our findings demonstrate that strategies for economic growth and poverty reduction in Nepal should consider aspects of the dynamics of domestic and international migration.
Smoking is a problem, bringing signifi cant social and economic costs to Russiansociety. However, ratifi cation of the World health organization Framework conventionon tobacco control makes it possible to improve Russian legislation accordingto the international standards. So, I describe some measures that should be taken bythe Russian authorities in the nearest future, and I examine their effi ciency. By studyingthe international evidence I analyze the impact of the smoke-free areas, advertisementand sponsorship bans, tax increases, etc. on the prevalence of smoking, cigaretteconsumption and some other indicators. I also investigate the obstacles confrontingthe Russian authorities when they introduce new policy measures and the public attitudetowards these measures. I conclude that there is a number of easy-to-implementanti-smoking activities that need no fi nancial resources but only a political will.
One of the most important indicators of company's success is the increase of its value. The article investigates traditional methods of company's value assessment and the evidence that the application of these methods is incorrect in the new stage of economy. So it is necessary to create a new method of valuation based on the new main sources of company's success that is its intellectual capital.