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Drawing on Harrod, Kalecki and Kaldor, this paper seeks to revive the view that ceteris paribus firms reduce investment if they have already built up high capacities relative to their assessment of the normal potential of their markets. This reaction introduces a fundamental stabilizing mechanism into the economy. The paper adapts the idea to a growth context and applies it to the neo‐Kaleckian baseline model with its Harrodian instability. It demonstrates that, in principle, a sufficiently strong feedback could stabilize the steady state. [ABSTRACT FROM AUTHOR]

This paper studies the effects of China's one‐child policy on saving and foreign reserve accumulation. Fertility control increases the saving rate both by altering saving decisions at the household level, and by altering the demographic composition of the population at the aggregate level. I show that demographically induced changes in saving explain the build‐up of a large foreign surplus in China. As in Song, Storesletten, and Zilibtti (2011), the model features contractual and financial market imperfections. Government‐owned firms are less productive but have full access to the credit market. Entrepreneurial firms are more productive but face credit constraints. As labour switches from less productive to more productive firms, demand for domestic bank borrowing decreases. As saving increases while demand for loans decreases, domestic savings are invested abroad, generating a foreign surplus. The model predicts that China's foreign reserve accumulation will soon begin to slow down in response to recent relaxation of the one‐child policy. [ABSTRACT FROM AUTHOR]

Using a newly compiled and comprehensive database from International Financial Statistics, and applying panel‐regression techniques, this paper documents the evolution of households' and firms' dollarization over the past decade and assesses its macroeconomic determinants. Households' and firms' dollarization have much in common. Structural factors are more relevant than macroeconomic stability. Regarding differences, deposit dollarization, better institutions and lower inflation are relevant for households but not firms, whereas the exchange rate movements seem to play a role only for firms, particularly in higher‐income countries. In terms of loan dollarization, financial deepening is a critical driver for households only. [ABSTRACT FROM AUTHOR]

The formation of new firms is an important determinant of regional economic development and agglomeration is a key factor affecting the formation and scale of operations of new firms. The present paper is among the first to explore the relationship between agglomeration economies (using localization and urbanization economies) and new firms' formation and scale of operations in a developing country. We make use of rich firm‐level data and find that agglomeration has a significant impact on the formation of new firms and their scale of operation in Punjab, Pakistan. Our findings also reveal that localization at all scales (small, medium and large) has a positive correlation with the arrival of new firms, while medium‐scale and large‐scale localization is positively correlated with the scale of operation of new firms. [ABSTRACT FROM AUTHOR]

African countries face an economic transformation gap. Given the large and growing Chinese presence on the African continent, a fundamental question is whether Chinese firms contribute to, or hinder, economic transformation in Africa. This article conducts a scoping review of over one hundred sources, examining the pathways through which Chinese firms can affect economic transformation. On balance, the literature points to a positive role of Chinese firms. Africa–China trade leads to mixed results, while Chinese investment and infrastructure construction are found to contribute positively to transformation. Chinese firms are also found to support capacity building, spillovers and innovation in African countries. [ABSTRACT FROM AUTHOR]

Allowing provinces to find their own way forward was central to Vietnam's progress in institutional and economic development. This article examines who drives this process of economic reform and finds that, in those provinces making the most progress, the private sector played an important role, not against, but with government. Both national and foreign enterprises played a role, but small enterprises tended to be marginalised. Some of the best insights come from comparing provinces and observing how different alignments of interest influenced the reform process. [ABSTRACT FROM AUTHOR]

ABSTRACT This paper studies the link between knowledge, innovation, and growth in European regions using nonparametric methods. Our findings suggest that knowledge inputs and the share of innovative firms have a heterogeneous and nonlinear relationship with growth. This evidence has been exploited to examine the consequences of alternative policies using a counterfactual estimation setup, the results of which imply that increasing the formal knowledge base may be optimal in most regions. Less knowledge and innovation intensive regions will also benefit from a higher innovation potential and from a trustworthy and entrepreneurial economic environment. [ABSTRACT FROM AUTHOR]

This paper critically evaluates the relationship between state capitalism and "strategic coupling" within global production networks (GPN). It underscores specifically the lack of cases on "coupling" involving state‐owned enterprises (SOEs) from developing countries and city‐regions within developed countries. Most existing studies focus on the connection between regions in developing economies with lead firms originating from developed economies. This leaves open a conceptual and empirical gap as SOEs from developing countries (like those of China and India) are (1) increasingly becoming lead firms in their own right and (2) investing in developed economies. Against this backdrop, this paper highlights conceptually significant points from the acquisition of Nexen, a Canada‐based oil and gas TNC, by CNOOC, a large Chinese SOE, and argues for a fresh research agenda that examines the strategic coupling of lead firms that are also SOEs from developing economies. [ABSTRACT FROM AUTHOR]

The question of what constitutes the discipline of business history has been the focus of ongoing debate for several decades. The output of business history researchers is diverse ranging from company histories to the application of theoretical frameworks used to interpret the many facets of business development. This article, in introducing this special edition of the Australian Economic History Review, provides an overview of the development of the business history discipline and the contribution it has made to understanding the operation of business enterprises and the markets in which they operate. [ABSTRACT FROM AUTHOR]

Many economists have long held that market failures create a gap between social and private returns to research and development (R&D), thereby limiting private incentives to invest in R&D. However, this common belief that firms significantly underinvest in R&D is increasingly being challenged, leading the rationale behind public support for private R&D to be questioned. In this paper, we attempt to clarify the perspectives of two sources: the theoretical literature on endogenous growth, and its recent developments in integrating a geographical dimension, and the empirical literature that measures the social returns to R&D in relation to the private returns. Ultimately, we are able to clearly distinguish among different types of market failures and compare their relative impact on the gap between the private and social returns to R&D. Two main conclusions are reached. First, systematic firm underinvestment in R&D is not demonstrated. Second, even though instances of underinvestment do occur, they are mainly explained by surplus appropriability problems rather than by knowledge externalities. This suggests the need for a new policy mix that employs more demand-oriented instruments and is more concentrated on identifying efficient allocations among activities rather than merely increasing global private R&D investment. [ABSTRACT FROM AUTHOR]

Abstract: The Republic of South Africa faces the imperative of escaping economic stagnation. This article seeks to synthesise results from a series of research efforts, including but not limited to the articles presented in this special issue, and consider policy options for escaping economic stagnation. The focus is on South Africa and South African policies yielding relatively quick dividends in terms of growth and taking the rest of the world as given. Four broad implications are presented. These could form part of a concerted effort to escape from South Africa's long running economic malaise. [ABSTRACT FROM AUTHOR]

Abstract: This special issue focuses on a collaborative effort between the National Treasury and the South African Revenue Service (SARS) to employ administrative record data from SARS for economic policy analysis. It contains six research articles plus a synthesis article designed to draw out potential policy implications and to place this research into a broader context. Exploitation of tax administrative record data has become global best practice. We conclude that this effort demonstrates strong prospects for developing a better understanding of the South African economy with positive implications for economic policy formulation. [ABSTRACT FROM AUTHOR]

This study examines whether and when political embeddedness affects firms' growth. Using a dataset of Chinese A‐share firms from 2008 to 2017, we find that both organizational and individual political embeddedness in firms draws negative effects on corporate growth. Such effects mainly come from political embeddedness created by current and local political actors, compared with former and central ones. Moreover, the "grabbing effects" of political embeddedness vary contingent on focal firms' financial situation, political uncertainty, and regional economic and legal environment. That is, the "grabbing effects" are stronger for financially healthy firms than for financially distressed firms. Political uncertainty created by government official replacement refrains political actors from tunneling benefits from affiliated firms and mitigates the negative effects of political embeddedness. Both economic development and legal completeness are conducive to alleviating the "grabbing effects" of political embeddedness. Overall, our findings enrich and extend the "grabbing hand" theory. [ABSTRACT FROM AUTHOR]

Despite evidence of substantial differences in business exit rates across countries, understanding of the institutional conditions contributing to those differences is still incomplete. Methodological limitations have left considerable gaps in our understanding of business exit, due to the dominance of regression models that capture institutional conditions in isolation, but fall short of identifying complex combinations of conditions. Using Global Entrepreneurship Monitor (GEM) data and a fuzzy-set qualitative comparative analysis (fsQCA) of a sample of 54 case countries, we utilize a configurational approach to examine how different combinations of regulatory, normative and culturalcognitive institutional conditions lead to variations in business exit rates across countries at different stages of economic development. Further, we identify distinct recipes leading to business exit that are associated with the presence or absence of high business exit rates across countries. The study contributes to institutional theory as well as the business exit literature not only by discussing which combinations of institutions determine when exit is beneficial and detrimental to the economy, but also which specific combinations apply across sets of countries. [ABSTRACT FROM AUTHOR]

Journalistic reports and case study evidence suggest that governments have made policy and institutional reforms to achieve or maintain eligibility for assistance from the Millennium Challenge Corporation (MCC). However, the empirical scope of the "MCC Effect"—across countries, policy domains, and time—remains a subject of speculation and debate. There is also little rigorous evidence about the conditions under which the MCC eligibility standards have influenced the reform efforts of developing country governments. To address this challenge, we construct an original data set that measures whether, when, and how governments in low‐income and lower‐middle‐income countries responded to the eligibility requirements for MCC assistance between 2004 and 2010. Our econometric analysis of the data set calls attention to an underappreciated factor that shapes the adoption and implementation of externally influenced reforms: the presence of a technocratic reform team with executive authority to introduce disruptive changes to the status quo. [ABSTRACT FROM AUTHOR]

This article examines the employment impact of Aid for Trade (AfT) flows to recipient countries. The analysis has used an unbalanced panel dataset comprising 126 countries, of which 42 Least developed countries (LDCs) over the period 2002–15. Based on the two‐step system Generalized Methods of Moments approach, the empirical analysis shows that over the full sample, AfT has exerted a positive and significant effect on total (male and female) employment share, as well as on female employment share, but no significant effect on male employment share. However, these effects are not the same in LDC economies versus non‐LDC economies. [ABSTRACT FROM AUTHOR]

The Government of China assists Malawi with infrastructure, grants and loans, and Chinese businesses provide cheap commodities to Malawians. Despite this, Tumbuka northern Malawians do not conceptualise the Chinese as doing development. Rather, they perceive the Government of China as exploiting their government and conceptualise Chinese goods as signifiers of Malawi's underdevelopment. This article argues that Tumbuka apprehensions about China reflect a prominent Malawian discourse, where 'development' is associated with westernisation and is gifted into a nation and community by wealthy outsiders. This finding goes someway to explaining Malawians' reactions to Chinese 'developers' and presents a challenge to western development norms. Copyright © 2017 John Wiley & Sons, Ltd. [ABSTRACT FROM AUTHOR]

As untying aid was widely considered key to enhancing aid effectiveness, the South Korean government decided to increase the share of untied aid. While the share increased substantially in recent years, considerable variation exists in the proportion of untied aid provided to different recipient countries. This article explores the reasons why. We identify three key variables: international factors, economic interests and recipient country governance. By analysing South Korea's aid data for the period 2010-2013, we find that Korea's aid-untying practice is affected by international norms and the recipient country's governance, but not by peer pressure and economic interests. Copyright © 2015 John Wiley & Sons, Ltd. [ABSTRACT FROM AUTHOR]

This study investigates the exchange rate exposure of Chinese firms at the industry and firm level based on the conventional capital asset pricing model ( CAPM) framework. At the industry level, the dynamic conditional correlation MGARCH (DCC MGARCH) estimates demonstrate that the market model and three-factor model are appropriate for exposure measurements, and industry returns are more likely to be exposed to unanticipated changes in the real exchange rate and the trade-weighted effective exchange rate, particularly for manufacturing industries. At the firm level, although the seemingly unrelated regression (SUR) estimates vary across markets, it is apparent that there is a relationship between firm size and exposure effects, which also show that lagged exchange rate changes have significant exposure effects on firm returns. This study finally suggests that non-financial firms should set up special commissions to hedge currency risks of their future cash flows. [ABSTRACT FROM AUTHOR]

We examine the joint influence of post-acquisition integration management and acquisition focus on long-run post-acquisition performance. We develop a financial measure related to integration that is based on changes in net purchases/disposals of physical assets. For a sample of acquisitions by Australian listed firms, we find that the main effects and the interaction of our integration measure and focus are related to performance in the direction suggested by theory. Our results suggest that inconsistencies in previous studies of the focus-performance relation are partly explained by the failure to consider the post-acquisition asset management strategies. [ABSTRACT FROM AUTHOR]