Developing Hedonic Indices for Information Technology Products in Russia [27/07/2006]
Parkhomenko, A., Redkina, A.
Economists have noted for decades that Consumer Price Index (CPI) in the developed countries is overstating inflation by 0.5–2.0% per year. A significant part of such a bias is found to be caused by the presence of technology products and differentiated products in CPI. An increasing weight of these products in the Russian CPI may also lead to a substantial upward bias. Nowadays hedonic indices are believed to be the most efficient way to reduce the bias. Following Triplett, we have developed the taxonomy of hedonic price indices within the “direct approach”. This first step is essential in constructing a detailed set of hedonic price indices. They can be used in two ways: to estimate the bias in CPI and to elaborate alternative official price indices for IT-products.
Privatization before and after the “Orange” Revolution [27/07/2006]
Paskhaver, A., Verkhovodova, L.
In Ukraine, the privatization became an extremely divisive political issue during and after the “Orange” Revolution. The process of privatization that has begun since 1992 contributed to the emergence of oligarchs, who provided the political and financial support to the previous government. The paper considers how the privatization changed into the instrument aimed at low-priced transferring of public property to business groups allied with the previous government. This was a source of public tensions in the Ukrainian society. The paper also shows how the privatization became a “shock” re-privatization (a compulsory return of privatized objects into the public property for re-sale) after the “Orange” Revolution.
Institutions as the Fundamental Cause of Long-Run Growth [27/07/2006]
Acemoglu, D., Johnson, S., Robinson, J.
This paper develops the empirical and theoretical case that differences in economic institutions are the fundamental cause of differences in economic development. We first document the empirical importance of institutions by focusing on two “quasi-natural experiments” in history, the division of Korea into two parts with very different economic institutions and the colonization of much of the world by European powers starting in the fifteenth century. We then develop the basic outline of a framework for thinking about why economic institutions differ across countries. Economic institutions determine the incentives of and the constraints on economic actors, and shape economic outcomes. As such, they are social decisions, chosen for their consequences.
Do Institutions Cause Growth? [27/07/2006]
Glaeser, E., La Porta, R., Lopez-de-Silanes, F., Shleifer, A.
We revisit the debate over whether political institutions cause economic growth, or whether, alternatively, growth and human capital accumulation lead to institutional improvement. We find that most indicators of institutional quality used to establish the proposition that institutions cause growth are constructed to be conceptually unsuitable for that purpose. We also find that some of the instrumental variable techniques used in the literature are flawed. Basic OLS results, as well as a variety of additional evidence, suggest that a) human capital is a more basic source of growth than are the institutions, b) poor countries get out of poverty through good policies, often pursued by dictators, and c) subsequently improve their political institutions.
CIS Economies in 1991–2003: A General Review [27/07/2006]
Chubrik, A.
The paper analyses development of CIS economies after collapse of the Soviet Union. Comparison of output dynamic in CIS and CEB is presented, focusing on initial conditions and economic policies as economic growth determinants. It is shown that structural imbalances inherited from the Soviet Union have played important but not crucial role in output behavior. Countries that overwhelmed high inflation, implemented reforms of the ‘first wave’, and created favorable conditions for business development have managed to overcome these imbalances relatively painlessly, and switched to recovery growth. Belarus, Turkmenistan, and Uzbekistan appeared to be ‘growth puzzles’, as they showed quite fast output growth despite reform reversals.
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