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This study aims at unpacking the internal R&D determinants spurring a firm to invest in R&D abroad, that is owning R&D performing affiliates abroad. Differently from previous literature – mainly focusing on country level determinants as well as on motivations for the location choice of foreign R&D – we make a shift in the observation point. In particular, we dig deeper into the characteristics of firms' intra-mural R&D and the different types of R&D outsourcing to assess their association with R&D internationalisation. On the one hand, we account for the different types of R&D employees (share of researchers and technicians on R&D employees) and R&D performance (basic versus applied research; R&D performed in laboratories rather than in production facilities); on the other hand, we focus on a specific type of R&D outsourcing (to non-affiliated foreign partners, that is the “contract offshoring R&D”). The analysis is performed on an unbalanced panel of 33,476 observations referring to all Italian R&D performers over the 2003–2010 period. Our findings reveal that a more structured organisation of R&D at home (e.g. performing R&D in dedicated laboratories) and the propensity to outsource R&D to foreign non-affiliated partners are associated with a higher share of R&D internationalisation. [ABSTRACT FROM AUTHOR]

High-growth firms (HGFs) have aroused considerable interest both by researchers and policymakers mainly because of their substantial contribution to job creation and to the advancement of the surrounding economy (Acs et al., Small Bus Res Summ (328):1-92 2008, Schreyer 2000). Any initiative to foster HGFs requires the ability to reliably anticipate them. There seems to be a consensus in previous mainly regression-based studies on the impossibility of such a prediction (Coad, Doc Trav Centre d’Econ Sorbonne 24:1-72 2007b). Using a novel random forest (RF) based approach and a recent data set (2004-2014) covering 179970 unique firms from nine European countries, we show the potential of a true out-of-sample prediction: depending on the country, we were able to determine up to 39% of all HGFs by selecting only ten percent of all firms. The RF algorithm is both used to determine relevant predictors and for the actual prediction and pattern analysis. Both the selection of the best RF and the cross-country comparisons are based on a Receiver Operating Characteristic analysis. We find that most accurate HGF predictions are possible in GB, France, and Italy and largely confirm this ranking using Venkatraman’s unpaired test. Apart from the firm’s size, age, and past growth, the sales per employee, the fixed assets ratio, and the debt ratio are quite important. Our “typical” HGFs determined using RF prototypes have been older and bigger than the remaining firms, which is counterintuitive and atypical in literature. Based on our finding, typical HGFs are not start-ups, which questions current political funding strategies. Apart from that, our results do not support and rather refute the existence of a survivorship bias. Moreover, approximately every fourth HGF remains to be a HGF in the next period. [ABSTRACT FROM AUTHOR]

Motivation: The results of the in-out referendum on the United Kingdom's membership in the European Union has shown that the European project, understood as a process of political integration within the EU is not stable. The economic crisis as well as the migration crisis has started new discussion on the European project and its weaknesses. The British decision to leave the European Union significantly influences the conditions of the EU functioning and future. There is no doubt that the present situation is the most serious crisis in the history of the European integration. Aim: The aim of the paper is to analyze the hybrid model of integration and its influence on the United Kingdom's decision to exit from the European Union and to broaden our understanding of the factors influencing that decision. The specific position of the United Kingdom in the EU will be analyzed. The history of the UK membership in the EU and the fundamental tension in the Member States' debates concerning the model of integration will be discussed. The current situation represents a trade-off between two rival, federal and confederal, models of integration. The weaknesses of the present model of integration and its influence on the current state of the EU will be discussed. Results: From the very beginning the UK membership in the EU has been marked by many tensions. One of the most important problem was the discussion on the future model of the integration. The paper demonstrates that the present European integration hybrid model is the main reason for the EU crisis and the United Kingdom's decision to leave the European Union. [ABSTRACT FROM AUTHOR]

The paper offers a comparative investigation of objective and subjective driving forces behind the satisfaction that people feel in their job in four representative countries of Western Europe. The main element of this work’s novelty is its linking the research of cross-country similarities and differences in the leading determinants of global job satisfaction to methodological issues that arise when responses to survey questions are detected on a rating scale through self-evaluation. In particular, this paper is one of the first attempts to test the potentialities of CUB models on EWCS data in a broader conceptual framework in which the response on overall job satisfaction depends on some psychological dynamics of the evaluation process. Although overall job satisfaction is significantly higher for British and German employees, the subjective factors—the amount of socio-economic security embodied in a job, the working conditions and the aspects of work-life balance—are the most relevant in shaping job satisfaction, disregarding the myth that considers earnings as the dominant factor. [ABSTRACT FROM AUTHOR]

During the boom years 2000-2007, the new Central and East European (CEE) members of the European Union (EU) had more than twice as high economic growth as the 15 countries that were members of the EU before 2004. From 2010, however, their growth rates have been mediocre though still higher than those of the older EU members. This paper investigates seven structural benchmarks, fiscal burden, tax system, labor markets, education, pensions, governance, and research and development. The CEE countries are continuing to perform quite well in all these regards apart from research and development. Another cause of concern is large emigration. Thus, growth of GDP per capita instead of GDP growth looks much better for the CEE countries. No middle-income trap is apparent. [ABSTRACT FROM AUTHOR]

Medieval monarchs in Western Europe responded to financial and military pressures by instituting representative assemblies. Three estates (classes; orders) were represented in these assemblies: clergy, nobility, and burghers. In the late medieval and early modern periods, some states tended towards absolutism (e.g., France); others towards constitutional monarchy (e.g., England). The German historian Otto Hintze conjectured that two-chamber assemblies were more likely to resist monarchical encroachments on their political authority than three-chamber assemblies. We argue that the two- versus three-chamber distinction is coincidental to what was truly relevant: whether chambers were estate-based or had mixed representation from multiple estates. We provide a comparative institutional analysis that emphasizes political bargaining and the costs of expressing special versus common interests. This analysis suggests that mixed representation assemblies, all else equal, provided a stronger check on absolutism than their estate-based counterparts. We also provide historical case studies of France and England that lend insights into why an estate-based Estates General arose in the former, while a mixed representation Parliament arose in the latter. [ABSTRACT FROM AUTHOR]

This paper investigates the effect of trust on inventive activity. The paper uses generalised trust and about 20 other trust (and trustworthiness)-related indicators and investigates which trust-related variables explain inventive activity in 20 European countries divided into 135 regions with a special focus on causal, nonlinear and spatial forces. The findings indicate that only generalised trust and non-egoistic fairness have robust effects on inventive activity in Europe. Using historical data on the extent and existence of universities as instruments, a causal relationship between trust and inventive activity is set up. Even after controlling for causal, spatial and nonlinear forces, there is a significant direct impact of trust on inventive activity. The result show that a one standard deviation rise in general trust (a 12.5 % rise in the trust level) increases patents per million inhabitants on average by 2 %. Despite the growing literature that associate social capital to inventive activity at the regional level, the direct policy conclusions are weak. This paper argues that moving from “regional learning” to “learning region” may induce researchers to consider direct and down-to-earth policy implications. [ABSTRACT FROM AUTHOR]

Advances in knowledge lead to innovation, understood as the development of new ideas that create value for firms and allow them to build regional competitive advantage. While the European Union has placed considerable emphasis on the development of indices measuring phases or aspects of innovation (Innovation Union Scoreboard and Regional Innovation Scoreboard) and competitiveness (Union Competitiveness Report and Regional Competitiveness Index), there are very few studies on the progress of the basis of scientific and technical knowledge in Europe. Therefore, this paper addresses the measurement of the regional knowledge base—understood as the availability of access to the specialized knowledge resources of a territory, normally embedded in the regional actors—in Europe through a new indicator. This allows the creation of a ranking of the European regions based on their knowledge base profiles. [ABSTRACT FROM AUTHOR]

This paper studies the effects of several tax reforms in an economy where taxes are partially evaded by means of undeclared work. To this purpose, we consider a two-sector dynamic general equilibrium model calibrated to Italy which explicitly accounts for underground production. We construct various tax reform scenarios, such as ex ante budget-neutral tax shifts from direct to indirect taxes, and tax cuts on labor and business financed by decreases of government spending. Our results indicate that neglecting the existence of the underground sector may lead to severely miscalculating the macroeconomic effects of tax reforms. Further, the dimension of the underground sector is permanently and considerably reduced by changes in the tax mix that diminish the labor tax wedge. Reductions of the business tax prove to be highly expansionary in the presence of a sizable informal sector. [ABSTRACT FROM AUTHOR]

This paper analyzes the relationship between GDP (gross domestic product), carbon dioxide emissions from the consumption of energy, total renewable electricity consumption, dry natural gas consumption, and total petroleum consumption (all variables are in per capita terms) for Peru during 1980–2011. The Autoregressive Distributed Lag (ARDL) methodology was used to test a cointegration relationship, and the Granger causality test, based on the vector error correction model (VECM), was used to test for causality. An innovative criterion proposed by Narayan and Narayan (2010) was employed to test the Environmental Kuznets Curve (EKC) hypothesis. The study does not support an inverted U-shaped EKC relationship. For this reason, it is urgent that Peru designs environmental policies that minimize the emission of greenhouse gases (GHG) using alternative energy sources e.g. solar, wind, hydraulics, among others. In addition, we found an unidirectional causality relationship between CO 2 emissions and their determinants. [ABSTRACT FROM AUTHOR]

This paper analyses the effects of the intensity of regulations in the product and labour markets on the growth of total factor productivity (TFP) for 121 European regions. A technological catch-up model is estimated for the period 1995–2007. We use the spatial lag of X (SLX) model to capture possible spatial interactions across spatial units. Our empirical findings show that lower levels of regulation are associated with higher TFP growth. Lower barriers to entrepreneurship and lower bureaucratic costs have a positive effect on productivity growth. Corruption raises operational costs, distorts the allocation of resources and negatively affects innovation activities, thereby reducing TFP growth. Further liberalization in the labour market (in terms of hiring and firing regulation, working hours regulation and employment protection legislation) has a significant positive effect on the growth of TFP. In addition, both regional technological and regional human capital have a positive impact on the TFP growth in European regional economies. [ABSTRACT FROM AUTHOR]

Previous literature on a variety of countries has documented a "healthy immigrant effect" (HIE). Accordingly, immigrants arriving in the host country are, on average, healthier than comparable natives. However, their health status dissipates with additional years in the country. HIE is explained through the positive self-selection of healthy immigrants as well as the positive selection, screening and discrimination applied by host countries. In this article we study the health trajectories of immigrants within the context of selection and migration policies. Using SHARE data we examine the HIE, comparing Israel and 16 European countries that have fundamentally different migration policies. Israel has virtually unrestricted open gates for Jewish people around the world, who in turn have ideological rather than economic considerations to move. European countries have selective policies with regards to the health, education and wealth of migrants, who also self-select themselves. Our results provide evidence that (1) immigrants who move to Israel have compromised health and are significantly less healthy than comparable natives. Their health disadvantage persists for up to 20 years of living in Israel, after which they become similar to natives; (2) immigrants who move to Europe have significantly better health than comparable natives. Their health advantage remains positive for many years. Even though during some time lapses they are not significantly different from natives, their health status never becomes worse than that of natives. Our results are important for migration policy and relevant for domestic health policy. [ABSTRACT FROM AUTHOR]

From modest beginnings in 1957, the EU has since evolved both by deepening - adding new tasks and responsibilities to the Commission's remit - and by widening - adding new members in a series of accessions, to arrive at the present 28 member states. A new complication was the UK's referendum in June 2016 that opted for Brexit. The EU's evolution by enlargement is examined, followed by an outline of the major EU institutions and the links between them. This includes EU engagement with the wider world via trade deals and aid. The suitability of the EU's acquis for applicant states and countries in the EU neighbourhood is reviewed, followed by an assessment of the overall EU 'Model'. Having appeared to function well and deliver significant benefits to the member states, the 'Model' has performed far less well since the 2007-2009 financial crisis, revealing major weaknesses in the Union's capabilities. The EU needs new, more flexible economic models, as well as new modes of engagement, both internally and with its various partners. In addition, the EU's political model needs reform, both to deal with the democratic deficit and to provide for more effective decision-making. [ABSTRACT FROM AUTHOR]

Although there is considerable research evidence showing that immigrants are at great risk of poverty, there have been few comparative analyses of the poverty gap between immigrants and natives across Europe. We examine the patterns of variation in the immigrant-native poverty gap between and within countries. We simultaneously combine characteristics of households from the European Union Statistics on Income and Living Conditions and some key country-specific factors, distinguishing among mixed and non-mixed immigrant households and natives. The main findings for 2012 reveal that immigrants, especially non-mixed immigrant households, are exposed to a higher risk of poverty than natives, though this gap varies across countries. We find evidence of significant household-level effects, but the contribution of country-level variables to explain cross-country differences in the poverty gap is substantially higher. Concerning household characteristics, employment and being young have less effect (positive and negative, respectively) on immigrants than on natives, while each additional child has a more negative effect. Education seems to have a lower effect on the likelihood of being poor for non-mixed immigrant households than for natives and owning a house reduces this likelihood more for non-mixed immigrant households. In terms of country-level factors, labour market and social benefits seem to be equally important for both natives and immigrants. We also compare the results in 2012 with those for 2007 to check for possible changes over time related to the influence of the economic cycle on the poverty gap and/or on the importance of household- and country-level factors. [ABSTRACT FROM AUTHOR]

Copyright of Regional Studies is the property of Routledge and its content may not be copied or emailed to multiple sites or posted to a listserv without the copyright holder's express written permission. However, users may print, download, or email articles for individual use. This abstract may be abridged. No warranty is given about the accuracy of the copy. Users should refer to the original published version of the material for the full abstract. (Copyright applies to all Abstracts.)

The aim of this article is to find out whether there is an innovation effect on the current account, and if there is one then to determine its significance. The study is carried out for the current accounts of European countries. Innovation is tested together with some other factors as control variables in order to estimate and compare its role in the determination process of the current account. The results indicate that innovation has quite a significant influence on the current accounts of European countries, and the form of the relationship between innovation and current account is non-linear. Moreover, the impact of innovation is stronger for countries at higher levels of innovation, but the growth rate of its average marginal effect diminishes through its increasing levels. [ABSTRACT FROM AUTHOR]

The research aims to identify the determinants of process and product innovation in a traditional and low-tech sector, supported in micro, small and medium-sized enterprises (SMEs), specifically European Construction Sector. The study uses micro data from the e-Business Survey of the European Commission. The dependent variables studied are binary (presence or absence of process or/and product innovation). The explanatory variables considered are: suppliers, clients, market orientation, turnover growth and size. In addition, some national context variables – GDP per capita and R&D weight in GDP – are also tested. The results show that the sector of construction innovates, and the factors that contribute more to this innovation are suppliers and growth of business. It is also concluded that firm size is more relevant for process innovation than for product innovation, and companies that are guided by international markets innovate more than those that focus on local and regional markets. [ABSTRACT FROM PUBLISHER]

Innovation and the use of information and communication technologies (ICT) are key areas for the European Cohesion Policy. Studies available at the regional level explore innovation and ICT use incorporating different variables, while those investigating ICT use mainly focus on that of households. This paper investigates the existence of common factors for innovation and ICT at the regional level, considering not only ICT use by households but also that of firms. Using factorial and spatial regression analysis, we find that although ICT use and innovation are mainly explained by different variables, knowledge-intensive services and the percentage of population aged 15-64 are common to all of them. In addition, ICT use by households and ICT use by firms are basically driven by different factors. Government quality is the main factor explaining ICT use at home, while ICT use by firms is mostly driven by employment in knowledge-intensive services. R&D is the main variable explaining innovation. We also find positive spatial effects, which are particularly notable in ICT use by households. The results stress the importance of promoting specialization strategies based on the knowledge economy that may contribute to creating synergies between innovation and ICT use in different environments. [ABSTRACT FROM AUTHOR]

The result of the decision whether to join the European Monetary Union, an irreversible policy choice for several European Union members, presents potentially significant costs and benefits. With a focus on the largest EU economy outside of the euro, Sweden, this paper applies the novel synthetic control method of estimation to evaluate whether there are costs or benefits associated with EMU membership in terms of various aspects of economic performance and how these have developed from 1999 to 2015. Findings indicate that Sweden would have borne non-negligible costs from currency union membership, exemplified by around 10% lower productivity, exports, investment, and consumption, and 8% greater government expenditure and imports on a yearly basis since the introduction of the euro, leading to significant cumulative reductions in potential economic activity. The robust results suggest costs may be persisting and in some cases growing in magnitude. [ABSTRACT FROM AUTHOR]

The introduction of new products, greater competitiveness-based export performances, and higher profits are three major benefits from technological change. We build on previous work that has identified ‘virtuous circles’ between R&D, innovation and profits in firms and industries [Bogliacino, F., and M. Pianta. 2013a. “Profits, R&D and Innovation: A Model and a Test.”Industrial and Corporate Change22 (3): 649–678; Bogliacino, F., and M. Pianta. 2013b. “Innovation and Demand in Industry Dynamics. R&D, New products and Profits.” InLong Term Economic Development, edited by A. Pyka, and E. S. Andersen. Berlin: Springer., Bogliacino, F., M. Lucchese, L. Nascia, and M. Pianta. 2016a. “Modelling the Virtuous Circle of Innovation. A Test on Italian Firms”Industrial and Corporate Change. doi:10.1093/icc/dtw045.] and between R&D, innovation and exports [Guarascio, D., M. Pianta, M. Lucchese, and F. Bogliacino. 2015. “Business Cycles, Technology and Exports.”Economia Politica – Journal of Analytical and Institutional Economics32 (2): 167–200; Guarascio, D., M. Pianta, and F. Bogliacino. 2016. “Export, R&D and New Products: A Model and a Test on European Industries.”Journal of Evolutionary Economics26 (4): 869–905.]. We test a model – with a Three Stage Least Squares methodology – using data at the industry level – for 39 manufacturing and service industries – for 6 major EU economies – Germany, France, Italy, Spain, the Netherlands and the United Kingdom – over the period 1995–2011. Results confirm the presence of a ‘virtuous circle’ linking the gains from technology, and identify the specific role of additional variables and the presence of lags and feedbacks. Moreover, the relevance of differences between Northern and Southern European countries is examined, with separate estimations that shed new light on the heterogeneity of these relationships. [ABSTRACT FROM AUTHOR]

Copyright of Regional Studies is the property of Routledge and its content may not be copied or emailed to multiple sites or posted to a listserv without the copyright holder's express written permission. However, users may print, download, or email articles for individual use. This abstract may be abridged. No warranty is given about the accuracy of the copy. Users should refer to the original published version of the material for the full abstract. (Copyright applies to all Abstracts.)

The paper is an attempt to show the competitiveness clusters policy as a key element of the new French industrial policy using recent evaluation results of this policy. The aim of the paper is threefold. Firstly, objectives of the competitiveness clusters policy as well as their characteristics, spatial distribution across the country, selected statistical data concerning their functioning are overviewed. Secondly, evaluation results of the French competitiveness clusters policy and a comparison of this instrument to similar ones existing in leading EU countries are provided. Thirdly, some crucial challenges resulting from the evaluation and policy orientations are proposed in order to increase the effectiveness of the competitiveness clusters policy in France. The descriptive analysis has been used in the paper as research method.

The aim of this paper is to look at the extent and type of internationalization among Hungarian information technology (IT) small- and medium-sized enterprises (SMEs) and the possible relationship between the degree of innovativeness and the internationalization of these companies. Information technologies play an important role in the Hungarian economy: this sector is one of the most R&D intensive industries in which many SMEs are active.

In this article, we scrutinize the innovation trajectory of eco-cement in the Netherlands by examining the innovation nexus of eco-cement manufacturers, scientists/researchers, waste producers and policymakers as part of a broader analysis of markets, policy and society, with special attention to standards and regulations. The influence of policy and innovation interactions are substantiated by policy documents, media news, patterns of eco-cement use, and in-depth interviews conducted with relevant eco-cement actors. Our analysis brings forward empirical evidence of how policymakers are involved in the innovation trajectory of eco-cement in multiple ways through building regulations, sector policies, waste policies, and science and innovation policies. Political economy aspects of regulation and innovation in cement industry (e.g. the cooperative approach of waste authorities with regard to re-use of waste, absence of policies to put a price on CO emissions from cement production) are being described, together with the specificities of the cement market. Bans on the disposal of fly ash and sewage sludge resulted in the use of those materials either as a supplementary cementitious material or a fuel. Demand for green cement from is presently growing but meets with several obstacles. Carbon policies are shown to constitute a weak influence. Innovation in eco-cement co-evolved with policy, through mutual dependencies, as a theoretical finding for innovation studies. [ABSTRACT FROM AUTHOR]

It is the first research to investigate for nonlinear interdependence of these two markets in the PIGS (Portugal, Italy, Greece and Spain) countries based on the quantile causality test. The results reveal the existence of the nonlinear causality relationship between the stock returns and real-estate returns in the PIGS countries. The empirical results of the quantile causality test suggest a significant causal relationship between these two markets in the PIGS countries, especially in the tail quantile. The existence of a significant tail interdependence implies that investors are unable to hedge the risk across the real-estate and stock markets when they are extremely volatile. Therefore, when there exist extreme returns between the two markets in the PIGS countries, both continuous negative impacts imply that instability in the real-estate market drives instability in the stock market and vice versa. It could be one of the major reasons why it deepened the systemic risk of the European sovereign debt crisis. [ABSTRACT FROM PUBLISHER]

This study focuses on the export performance of the 2004 European Union (EU) enlargement economies to the EU15 between 1990 and 2013. The long time span analysed allows to capture different stages in the relationship of these new members with the EU before and after accession. The study is based on the constant market share methodology of decomposing an ex-post country's export performance into different effects. Two constant market share analyses were selected in order to disentangle (i) the growth rate of exports and (ii) the growth rate of exports relatively to the world. Both approaches are applied to manufactured products grouping products in different classifications of sectors. Results provide information on export performance for the ten economies individually considered, including the importance of each EU15 destination market. [ABSTRACT FROM AUTHOR]

After the recent economic turmoil, besides the severe recession that hit most European Union (EU) countries, and the resulting downward trend in inflation, foreign direct investment (FDI) levels in certain EU countries have bounced back. Hence, we evaluate the effect of deflation on intra-Eurozone FDI. Even though deflation tends to cause a negative effect on investment, low production cost opportunities may arise, thus attracting inward FDI. Using panel data that span from 2003 to 2015, we initially estimate an FDI equation that incorporates deflation as a pre-determined variable and, consequently, a two-equation model that treats both FDI and deflation as endogenous variables. Our results suggest that deflation in periphery Eurozone countries does not deter FDI flows from core to periphery Eurozone countries. [ABSTRACT FROM AUTHOR]

Central to this paper is the analysis of inflation dynamics in the Euro Area as well as in eleven individual Euro Area member countries between 1990 and 2012. Based on the hybrid new Keynesian Phillips curve, the analyses include survey measures from Consensus Economics to compare inflation dynamics across Euro Area member countries. Particular focus is set on the choice of suitable measures of real marginal cost. In addition to the well-known output gap, the role of finance-neutral output gaps and unemployment gaps is examined. Throughout the analyses, price setting is found to be largely backward-looking, but with a decreasing trend over time. Countries' varying sensitivity to the different measures of real marginal cost is highlighted, which may indicate persistent heterogeneity in Euro Area inflation dynamics. With the onset of the financial crisis, finance-neutral output gaps outperform alternative measures of real marginal cost. [ABSTRACT FROM AUTHOR]

The levels and characteristics of entrepreneurship differ widely across EU countries and regions. Taking as reference data provided by the Global Entrepreneurship Monitor on entrepreneurial activity and entrepreneurial attitude, this paper analyses the disparities in entrepreneurship indicators among EU member countries in 2007 and 2013, highlighting the most significant changes that occurred during the Great Recession. Some of the major indices of inequality are calculated (Gini, Theil and Atkinson) and the change in the Gini coefficient between these two years is additively decomposed into mobility and progressivity components. Overall, we find that cross-national inequalities tend to increase in the procyclical aspects of entrepreneurial activity and attitude, while they tend to decrease in the countercyclical aspects. For entrepreneurial activity indicators, we reveal that heterogeneity increases in indicators such as opportunity-driven entrepreneurial activity and total entrepreneurial activity, while necessity-driven entrepreneurial activity becomes more homogeneous across countries. Regarding entrepreneurial attitudes, disparities among countries decrease in all indicators, except in perceived opportunities, for which cross-national inequality grows considerably during the crisis period. [ABSTRACT FROM AUTHOR]

Although it has been intensively claimed that Islamic banks are subject to more market discipline, the empirical literature is surprisingly mute on this topic. To fill this gap and to verify the conjecture that Islamic bank depositors are indeed able to monitor and discipline their banks, we use Turkey as a test setting. The theory of market discipline predicts that when excessive risk taking occurs, depositors will ask higher returns on their deposits or withdraw their funds. We look at the effect of the deposit insurance reform in which the dual deposit insurance was revised and all banks were put under the same deposit insurance company in December 2005. This gives us a natural experiment in which the effect of the reform can be compared for the treatment group (i.e., Islamic banks) and control group (i.e., conventional banks). We find that the deposit insurance reform has increased the market discipline in the Turkish Islamic banking sector. This reform may have upset the sensitivities of the religiously inspired depositors, and perhaps more importantly it might have terminated the existing mutual supervision and support among Islamic banks. [ABSTRACT FROM AUTHOR]

Results from the Eurosystem Household Finance and Consumption Survey reveal substantial variation in household net wealth across euro area countries that await explanation. This paper focuses on three main factors: (i) homeownership, (ii) housing value appreciation and (iii) intergenerational transfers. We show that these three factors, in addition to the common household and demographic factors, are relevant for the net wealth accumulation process in all euro area countries, and that, using various decomposition techniques, differences in homeownership rates and house price dynamics are important for explaining wealth differences across euro area countries. [ABSTRACT FROM AUTHOR]

Ukraine's socioeconomic crisis has been developing for years and has resulted in open sociopolitical turmoil and armed conflict. The population did not condone the goals of post-Soviet transition. Citizens grew disillusioned with their government and eventually lost faith in the future of their country. The role of workers' remittances in Ukraine's economy is often underestimated, although private consumption and stability are strongly connected to them. Social inequality and oligarchic control of key national assets has contributed to instability and uneven regional development. Due to prolonged underinvestment, economic growth has been slow. Improving growth is contingent on complex institutional reforms, macroeconomic stability, open external markets, and consensus among the elites. Recovering after a protracted socioeconomic and political crisis will require not only time but also improved governance, updated institutions, and a revitalized investment climate. Taken together, this can be called the second start of Ukraine's transition. [ABSTRACT FROM AUTHOR]

Our paper provides new insights on the developments and the drivers of foreign direct investment (FDI) in Central and Eastern European countries over the period 1993-2014, whilst taking into account the occurrence of the 2007 and 2011 crises. We apply a panel data general-to-specific approach and show that FDI inflows are driven by both external (i.e. macroeconomic and financial conditions in the euro area, global macroeconomic conditions and global risk environment) and domestic determinants (past FDI, human capital, market size, infrastructure, competitiveness, corporate tax system, risk premium, trade openness, geographical proximity to Western Europe, accession to the European Union and progress in implementing structural reforms). In addition, through a dynamic panel data analysis, we find a positive impact of FDI inflows on economic growth. We show that, despite the severe decline in FDI and real GDP growth rates at the onset of the 2007 crisis, the positive impact of FDI inflows on economic growth has amplified during this crisis, whilst it has become non-significant during the 2011 crisis. [ABSTRACT FROM AUTHOR]