Freshwater challenge has become an integral part of international political agenda since the last decade of the XX century. Huge amount of people who suffer from different types of water stress (over 1,1 bln.) brought global community to include Improved access to water and sanitation as one of 4 major components of Sustainable environment Millennium Development Goal (MDGs) of United Nations. On July 28, 2010, UN General Assembly added a right for water in the list of basic human rights. Evolution of life standards in developed countries, rising concerns of poverty and inequality lead to rethinking of a wide range of global challenges, which were mostly ignored by world community before. Aggravation of water access problem, regional contradictions over water allocation and rising demand for higher life standards reflect both continuous escalation of water stress and higher ethics of global civil society towards lifestyle and inequality problems.
Before early 2000s, economic experts did not pay enough attention to water issues besides national water facilities, irrigation, hydro energy and urbanization problems. Beyond national frontiers water discourse resolved to draughts and deserts monitoring. All attention was concentrated on local measures aimed to prevent floods and droughts or manage sophisticated problems of allocation of scarce water resource in transboundary basins. As it seems today, water deficit has become a structural factor influencing world economic development. Access to clean water is in the focus of Sustainable development policy, water deficit becomes a constraint for economic growth in both developed and developing countries. At the same time world expenses for R&D in water management, investments in droughts and flood security are steadily growing. Energy efficiency in cities and especially megacities arises more heavily, state programs on modernization of irrigation systems multiply each year and arid regions in Asia, Europe and North America invest more and more in new desalination plants.
The primary aim of this research is to compare diverse statistical models to predict critical financial state for Russian private small and medium-sized companies belonging to different sectors of economy.
We use the following methods: Linear Discriminant Analysis, Quadratic Discriminant Analysis, Mixture Discriminant Analysis, Logistic Regression, Probit Regression, Tree and Random Forest. Our dataset consists of approximately 1,000,000 observations from the Ruslana database and covers the period from 2011 to 2012.
Instead of standard definition of default we use the notion of critical financial state which means that we add companies liquidated as a result of legal bankruptcy to those liquidated voluntary.
We study four industries in detail: construction, manufacturing, real estate activities, retail and wholesale trade. Comparing industries, we come up to several compelling conclusions. On the one hand, the difference between sectors is so significant that it cannot be overcome by including several dummy variables but by estimating separate models for each industry.
On the other hand, sectors are similar in several ways. Firstly, importance ranking of regressors is stable among sectors that are analysed. This results in unique optimal set of variables chosen out of six possible alternatives. To add, inclusion of non-financial characteristics improves predictive power greatly. While age of a company and federal region are the key non-financial variables, size of a company is less important, and legal form is the weakest predictor. Secondly, Random Forest outperformed other statistical approaches on all data sets. For this method area under ROC-curve (the applied comparison criterion) reaches up to ¾ which is the same for all industries.
This research will be of vital importance especially to banks and other credit organisations providing loans to small and medium businesses as well as to state regulators.
In this article we present the ideas proposed/addresses during the initial de-velopment of interindustry interaction model, which due to various reasons were not implemented in empirical research of the USSR economy. We analyze current stud-ies and the underlying data, which provide an opportunity for continuation of re-search of interindustry interaction model, particularly in the direction entailed by the heterogeneous output assumption. We admit that the amount of inputs of an industry is related to the structure of its outputs market and propose the estimation method for the «core» product flows of the model. Our approach is illustrated with the help of experimental 25- industry input- output tables (1980-2004) in basic prices (2000) data provided by Institute of Economic Forecasting RAS.
This paper studies how heterogeneous individuals, that differ by entrepreneurial skills and productivity as a worker, endogenously choose their occupation (workers vs. entrepreneurs) based on expected income comparison (wages vs. profits). Each entrepreneur runs a firm that produces a single variety of a horizontally differentiated good under monopolistic competition. We show that the cutoff for occupational selection between workers and entrepreneurs is a negatively sloped curve in the space of individual characteristics. The form of this cutoff curve does not depend on the distribution of individual characteristics, but is affected by the elasticity of substitution between varieties. Changes in the distribution of individual characteristics can shift the cutoff curve. Thus individual employment choices depend not only on the distribution of characteristics, but also on the degree of competition in the market. We show that when the distributions of entrepreneurial skills and worker productivity are independent and follow power laws, an increase in the average worker’s ability decreases the share of entrepreneurs, whereas changes in the average entrepreneur’s skills do not affect this share. Estimates based on Current Population Survey (CPS) data are in line with the theoretical shape of the cutoff curve, and our estimates of the elasticity of substitution are close to those usually found in the literature.
The Labour Market Reform in Germany: a Special Case or an Example to Follow? In this article we study the institutional reform of the German labour market during the period 2003-2005, the so-called Hartz reforms. The aim of this paper is threefold. First, we describe the economic and institutional context of the German labour market before the Hartz reforms in light of general trends in market economies. The falling competitiveness of the German economy, the need to increase the flexibility and dynamics of the labor market have made the ruling elite to proceed with institutional transformations. Second, we analyze the theoretical concepts that became the basis for the labour market reform and examine the changes in the main labour market institutions. Finally, we evaluate the outcomes of the institutional reforms for economic activity, employment, unemployment and labour costs. Of major interest is the question about the impact of the Hartz reforms on internal flexibility. In this work we rely on the institutional analysis. Results of the study contribute to the understanding of the mechanism of labour market transformations. At the same time its main conclusions can be used for improving the economic and social policy in the Russian Federation. We came to the following conclusions. We have found the positive impact of the changes in labour market institutions on labour market outcomes: especially on the dynamics of economic activity and employment. The Hartz reforms fundamentally modified the functioning of the German labor market and increased both flexibility and job creation capacities. However, the pattern of German de-regulatory reforms accesses mostly the margins of the labour market, i.e. ‘outsiders’, that contribute to a growing dualisation of the employment system. This dualisation trend was reinforced by dynamics in industrial relations and company employment practices where we can observe growing reliance on mechanisms of internal flexibility for the skilled core work force and increasing use of non-standard types of employment in less specifically skilled occupations.
Corruption in government procurements remains to be one of grave problems in transition economies. A reaction to this problem in Russia came in 2005-2006 in form of a radical reform of government procurements. This paper analyses the main parameters of firms participating in government procurements before and after changes in regulation. Our analysis is based on the data of a survey of 957 manufacturing enterprises conducted in 2009. The questionnaire included queries about participation of firms in supplies to government orders, the extent of «kickback» in public procurement system etc. A similar survey with the same sampling was conducted in 2005, and this enabled us to construct a panel of 499 firms and to have a unique opportunity for a comparison of the situation before and after the radical change in the legislation. Our regression analysis confirmed the hypotheses that in 2005, firms with government stakes, old firms (established before 1992) and larger firms had advantages in access to government orders. Our analysis of the 2009 data showed a substantial growth in the share of firms participating in government procurements. As before, large firms retain their advantages in access to government orders. However for the old firms, the corresponding coefficient became insignificant. On the other hand, firms that are located in more developed Russian regions have obtained advantages in access to government orders. Our analysis of the 2009 data also revealed that factors of active modernization of the enterprises (presence of large-scale investment projects in 2005-2008, exports, ISO certification) had no influence on access of the firms to government orders. At the same time, the fact of having fulfilled government orders in 2004 has positive influence on participation of a firm in government procurements in 2008. Estimated scales of «kickback» in 2009 were practically the same. The results of our analysis enable us to conclude that principal goals of the radical reform in 2005 were never achieved. The conclusion of our paper examines of the reason for this situation and formulates policy implications.
The paper deals with a linear regression model. The EM algorithm is popular tool for maximum likelihood estimation of the parameters of regression model. It provides a method of robust regression under the assumption that the disturbances are independent and have identical multivariate t distribution. Previous work focused on the method of maximum likelihood estimation via the EM algorithm under the assumption that the degrees of freedom parameter of the t distribution is a scalar. In this paper, a broader assumption is employed, namely, that the disturbances have a multivariate t distribution with a vector of degrees of freedom. Missing values from the EM algorithm are random matrices. The theoretical results are illustrated in a simulation experiment using several distributions for the error process. Robust procedures are shown to be superior to the method of least squares.
Food industry plays a key role in each country. That is why the process of globalization makes the problem of ensuring safe production vary important, especially while attracting foreign capital. In this article the two mechanisms of the FDI distribution in Russian food industry companies are discussed. Special econometric tools for this analysis are also proposed. We investigate regional characteristics and the spatial lags (like factor of agglomeration, market potential and others) as determinants of the process. To test the influence of these determinants on the probability to have more than 10% of foreign capital in a company we estimate the hierarchical binary-choice models on a sample of Russian food industry companies (from RUSLANA database, on 2009). According to the results, the hierarchical diffusion of foreign investors is motivated by the seeking of local market and by seeking of the efficiency through lower transportation costs and better investment environment. The local resources in innovations are not significant on this level. When the investors develop new regions they take into account almost all the investigated regional characteristics. The logical complexification of a model allows not only to display the regional heterogeneity but also to determine the regions where the effect of some factors is irregular or more tangible. The development of transport infrastructure of the region and its spatial lag should be pointed out as one of the most substantial effects on the probability to have the FDI.
This article may be characterized as an analysis of the significance of global food problem on the current stage of world economy´s development. In this work the term ‘global food problem’ means unprecedented rise of world food price in the late XX – early XXI century, which make starve poor people in most countries. The author adduces the theoretical methods of approaching the global food problem, discloses the factors, which are the basis of this problem, describes the ways of mitigation of its impact on world economy. The article also contains the demarcation of the following terms: ‘food problem’ and ‘food security’. In the conclusion the author states that the main reason for the aggravation of the global food problem is a lack of investment to the applied agricultural sciences, which causes the inefficient use of resources. The conclusion also contains the ways of solving this problem.
This work, based on the results of long-term (up to 2050) pension forecasting, is devoted to the study of the impact of demographic parameters on the future of the Russian pay-as-you-go pension system. It assesses the sensitivity of the parameters of the pension system to changing scenarios of the population forecast. It is shown that the scenario with low birth rate, life expectancy and migration leads to the smallest increase in the number of pensioners, but at the same time to the greatest reduction in the number of contributors, which may have negative consequences for the situation on the labor market and economic development in general. On the contrary, the scenario with a high birth rate, high migration and the greatest increase in life expectancy gives the least reduction in the number of contributors, but dramatically increases the number of ‘insurance’ pensioners. From the perspective of fiscal sustainability of the pension system, the ‘low’ scenario is the best, but even there the number of pensioners begins to exceed the number of contributors already in 2024, and the gap between pension contributory incomes and the expenditures on ‘insurance’ pensions increases from 2.4% of GDP in 2017 to 4.6% in 2050. Furthermore, the dynamics of life expectancy in the ‘low’ scenario leaves no room for raising the retirement age. On the basis of statistics and population surveys, the article discusses whether there are socio-demographic reasons for raising the retirement age in Russia and concludes that the significance of the ill health is weakening as an argument against this measure. The article also presents the results of pension forecast performed for one of the possible options for raising the retirement age, which show that this measure significantly reduces the negative consequences of aging, even under the assumptions about a possible increase in unemployment and disability. By 2050, the gap between the pension incomes and expenditures is almost equal to the level of 2017 under the ‘high’ scenario of the population forecast and still remains 1.3-1.5 times lower for ‘medium’ and ‘low’ scenarios.
The analysis of short-term tendency of economic dynamics can be performed on seasonally adjusted data only. This implies that each time series is to be transformed in two: the seasonal component and the remaining part. The result of such decomposition depends on the specific features of the seasonal adjustment algorithm. Most uncertainty is expected within the neighborhood of crises when the economic indicators are likely to demonstrate substantial changes. Under such circumstances, the seasonal adjustment procedures are likely to generate spurious signals that deteriorate the seasonally adjusted series.
In this paper we analyze distortions of seasonally adjusted time series of economic data that appear in the neighborhood of crises. We examined the aberrations caused by sharp level shifts as well as by changes in seasonal pattern and showed that under these circumstances the standard algorithms of seasonal adjustment can generate spurious signals similar to first signs of a crisis or its second and following waves. We consider these misleading signals from two points of view: first, as an economic historian who operates with long time series of unchanging data; second, as an analyst of short-term dynamics monitoring the data that is subject to revisions.
We show that these aberrations can be misleading for understanding of short-run dynamics especially during the first years after a crisis. The identification of the end of a recession and estimation of seasonally adjusted values of observations right after the peak (or bottom) of a fluctuation seem to be the most problematic. Monitoring within this “blind zone” appears to be very complicated. We compared aberrations produced by X-12-ARIMA and TRAMO/SEATS. Some recommendations to soften the distortions are proposed.