Institutions and firm ownership structure:evidence from Central and Eastern Europe

FDI plays a key role in development, particularly in resource-constrained transition economies of Central and Eastern Europe with relatively low savings rates. Gains from technology transfer play a critical role in motivating FDI, yet potential for it may be hampered by a large technology gap between the source and host country. While the extent of this gap has traditionally been attributed to education, skills and capital intensity, recent literature has also emphasized the possible role of institutional environment in this respect. Despite tremendous interest among policy-makers and academics to understand the factors attracting FDI (Bevan and Estrin, 2000; Globerman and Shapiro, 2003) our knowledge about the effects of institutions on the location choice and ownership structure of foreign firms remains limited. This paper attempts to fill this gap in the literature by examining the link between institutions and foreign ownership structures. To the best of our knowledge, Javorcik (2004) is the only papers, which use firm-level data to analyse the role of institutional quality on an outward investor’s entry mode in transition countries. Our paper extends Javorcik (2004) in a number of ways: (a) rather than a cross-section, we use panel data for the period 1997-2006; (b) rather than a binary variable, we use the percentage foreign ownership as continuous variable; (c) we consider multi-dimensional institutional variables, such as corruption, intellectual property rights protection and government stability. We also use factor analysis to generate a composite index of institutional quality and see how stronger institutional environment could affect foreign ownership; (d) we explore how the distance between institutional environment in source and host countries affect foreign ownership in a host country. The firm-level data used includes both domestic and foreign firms for the period 1997-2006 and is drawn from ORBIS, a commercially available dataset provided by Bureau van Dijk. In order to examine the link between institutions and foreign ownership structures, we estimate four log-linear ownership equations/specifications augmented by institutional and other control variables. We find evidence that the decision of a foreign firm to either locate its subsidiary or acquire an existing domestic firm depends not only on factor cost differences but also on differences in institutional environment between the host and source countries.

The informal economy in the former Soviet Union and in Central and Eastern Europe

Guest editors' introduction

Ocular biometric correlates of early-and late-onset myopia

Myopia is a refractive condition and develops because either the optical power of the eye is abnormally great or the eye is abnormally long, the optical consequences being that the focal length of the eye is too short for the physical length of the eye. The increase in axial length has been shown to match closely the dioptric error of the eye, in that a lmm increase in axial length usually generates 2 to 3D of myopia. The most common form of myopia is early-onset myopia (EO M) which occurs between 6 to 14 years of age. The second most common form of myopia is late-onset myopia (LOM) which emerges in late teens or early twenties, at a time when the eye should have ceased growing. The prevalence of LOM is increasing and research has indicated a link with excessive and sustained nearwork. The aim of this thesis was to examine the ocular biometric correlates associated with LOM and EOM development and progression. Biometric data was recorded on SO subjects, aged 16 to 26 years. The group was divided into 26 emmetropic subjects and 24 myopic subjects. Keratometry, corneal topography, ultrasonography, lens shape, central and peripheral refractive error, ocular blood flow and assessment of accommodation were measured on three occasions during an ISmonth to 2-year longitudinal study. Retinal contours were derived using a specially derived computer program. The thesis shows that myopia progression is related to an increase in vitreous chamber depth, a finding which supports previous work. The myopes exhibited hyperopic relative peripheral refractive error (PRE) and the emmetropes exhibited myopic relative PRE. Myopes demonstrated a prolate retinal shape and the retina became more prolate with myopia progression. The results show that a longitudinal, rather than equatorial, increase in the posterior segment is the principal structural correlate of myopia. Retinal shape, relative PRE and the ratio of axial length to corneal curvature have been indicated, in this thesis, as predictive factors for myopia onset and development. Data from this thesis demonstrates that myopia progression in the LOM group is the result of an increase in anterior segment power, owing to an increase in lens thickness, in conjunction with posterior segment elongation. Myopia progression in the EOM group is the product of a long posterior segment, which over-compensates for a weak anterior segment power. The weak anterior segment power in the EOM group is related to a combination of crystalline lens thinning and surface flattening. The results presented in this thesis confirm that posterior segment elongation is the main structural correlate in both EOM and LOM progression. The techniques and computer programs employed in the thesis are reproducible and robust providing a valuable framework for further myopia research and assessment of predictive factors.

Density and cross-sectional areas of axons in the olfactory tract in control subjects and Alzheimer's disease:an image analysis study

Objective. Using an image analysis system to determine whether there is loss of axons in the olfactory tract (OT) in Alzheimer’s disease (AD). Design. A retrospective neuropathological study. Patients Nine control patients and eight clinically and pathologically verified AD cases. Measurements and Results. There was a reduction in axon density in AD compared with control subjects in the central and peripheral regions of the tract. Axonal loss was mainly of axons with smaller (<2.99 µm2) myelinated cross-sectional areas. Conclusions. The data suggest significant degeneration of axons within the OT involving the smaller sized axons. Loss of axons in the OT is likely to be secondary to pathological changes originating within the parahippocampal gyrus rather than to a pathogen spreading into the brain via the olfactory pathways.

Cholecystokinin (CCK) and CCK receptor expression by human gliomas:evidence for an autocrine/paracrine stimulatory loop

Cholecystokinin (CCK) is a gut-brain peptide has been described to be able to induce mitosis according to recent studies. Additionally, conflicting data has been published on whether tumours of the central and peripheral nervous system in general, and gliomas in particular, express CCK receptors. In the present in vitro study we employed reverse transcription followed by the polymerase chain reaction (RT-PCR) to investigate whether mRNA for CCK-A and CCK-B receptors as well as CCK peptide itself is present in primary human gliomas and the U-87 MG GBM cell line. The data show that 14/14 (100%) of the primary gliomas exhibited mRNA expression for the CCK peptide gene and the B receptor including the U-87 MG cells, whereas, only 2/14 (14%) showed presence of the CCK-A receptor. The presence of CCK receptors together with CCK peptide expression itself suggests presence of an autocrine loop controlling glioma cell growth. In support of this conclusion, a neutralizing antibody against the CCK peptide exhibited a dose dependent inhibition of cell growth whereas, antagonists to CCK caused a dose depend inhibition of exogenous stimulated glioma cell growth in vitro, via the CCK-B receptor which is PKC activated. Assessment of apoptosis and proteasome activity were undertaken and we report that treatment with CCK antagonists decreased proteasome and increased caspase-3 activity. These data indicate that CCK peptide and CCK-B are abundant in human gliomas and they act to stimulate cell growth in an autocrine manner, primarily via the high affinity CCK-B receptor, which was blocked by antagonists to CCK, perhaps via apoptosis.

An examination of policies and issues relating to the management of industrial land in core and peripheral urban areas

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Spillovers from foreign direct investment in Central and Eastern Europe:an index for measuring a country’s potential to benefit from technology spillovers

In the paper, we construct a composite indicator to estimate the potential of four Central and Eastern European countries (the Czech Republic, Hungary, Poland and Slovakia) to benefit from productivity spillovers from foreign direct investment (FDI) in the manufacturing sector. Such transfers of technology are one of the main benefits of FDI for the host country, and should also be one of the main determinants of FDI incentives offered to investing multinationals by governments, but they are difficult to assess ex ante. For our composite index, we use six components to proxy the main channels and determinants of these spillovers. We have tried several weighting and aggregation methods, and we consider our results robust. According to the analysis of our results, between 2003 and 2007 all four countries were able to increase their potential to benefit from such spillovers, although there are large differences between them. The Czech Republic clearly has the most potential to benefit from productivity spillovers, while Poland has the least. The relative positions of Hungary and Slovakia depend to some extent on the exact weighting and aggregation method of the individual components of the index, but the differences are not large. These conclusions have important implications both the investment strategies of multinationals and government FDI policies.

Aid allocation of the emerging Central and Eastern European donors

This paper examines the main characteristics of the (re-)emerging foreign aid policies of the Visegrád countries (the Czech Republic, Hungary, Poland, Slovakia), concentrating on the allocation of their aid resources. I adopt an econometric approach, similar to the ones used in the literature, for analysing the aid allocation of the OECD DAC donors. Using this approach, I examine the various factors that influence aid allocation of the Visegrád countries, using data for the years between 2001 and 2008. The most important conclusion is that the amount of aid a partner country gets from the four emerging donors is not influenced by the level of poverty or the previous performance of the recipients (measured by the level of economic growth or the quality of institutions). The main determining factor seems to be geographic proximity, as countries in the Western Balkans and the Post-Soviet region receive much more aid from the Visegrád countries than other recipients. Historical ties (pre-1989 development relations) and international obligations in the cases of Afghanistan and Iraq are also found to be significant explanatory factors. This allocation is in line with the foreign political and economic interests of these new donors. Although there are clear similarities between the four donors, this paper also identifies some individual country characteristics.

High growth firms, jobs and peripheral regions:the case of Scotland

Enterprise policy is increasingly favouring support for high growth firms (HGFs). However, this may be less effective in promoting new jobs and economic development in peripheral regions. This issue is addressed by a study of HGFs in Scotland. Scottish HGFs differ in a number of respects from the stylised facts in the literature. They create less employment than their counterparts elsewhere in the UK. Most have a significant physical presence outside of Scotland, thereby reducing their Scottish 'footprint' and domestic job creation. Scottish HGFs appear to have a high propensity to be acquired, increasing the susceptibility of the head office to closure. The evidence suggests that the tendency towards 'policy universalism' in the sphere of entrepreneurship policy is problematic.

One-year outcome of bevacizumab therapy for chronic macular edema in central and branch retinal vein occlusions in real-world clinical practice in the UK

Background: The purpose of this study was to investigate the 12-month outcome of macular edema secondary to both chronic and new central and branch retinal vein occlusions treated with intravitreal bevacizumab in the real-life clinical setting in the UK. Methods: Retrospective case notes analysis of consecutive patients with retinal vein occlusions treated with bevacizumab in 2010 to 2012. Outcome measures were visual acuity (measured with Snellen, converted into logMAR [logarithm of the minimum angle of resolution] for statistical calculation) and central retinal thickness at baseline, 4 weeks post-loading phase, and at 1 year. Results: There were 56 and 100 patients with central and branch retinal vein occlusions, respectively, of whom 62% had chronic edema and received prior therapies and another 32% required additional laser treatments post-baseline bevacizumab. Baseline median visual acuity was 0.78 (interquartile range [IQR] 0.48–1.22) in the central group and 0.6 (IQR 0.3–0.78) in the branch group. In both groups, visual improvement was statistically significant from baseline compared to post-loading (P,0.001 and P=0.03, respectively), but was not significant by month 12 (P=0.058 and P=0.166, respectively); 30% improved by at least three lines and 44% improved by at least one line by month 12. Baseline median central retinal thickness was 449 μm (IQR 388–553) in the central group and 441 µm (IQR 357–501) in the branch group. However, the mean reduction in thickness was statistically significant at post-loading (P,0.001) and at the 12-month time point (P,0.001) for both groups. The average number of injections in 1 year was 4.2 in the central group and 3.3 in the branch group. Conclusion: Our large real-world cohort results indicate that bevacizumab introduced to patients with either new or chronic edema due to retinal vein occlusion can result in resolution of edema and stabilization of vision in the first year.

Irrelevant or transformative power? The OECD DAC and foreign aid policies in Central and Eastern Europe

The paper examines the impact of the OECD’s Development Assistance Committee (DAC) on the emerging foreign aid policies of the Central and Eastern European (CEEs) countries. The Czech Republic, Poland, Slovakia and Slovenia joined the DAC in 2013, and the committee has aimed to socialise them into the norms of the international development system. Generally, however, there is little evidence of impact due to the soft nature of the DAC’s policy recommendations, and the fact that the committee, reacting to the challenges to its legitimacy from non-Western donors, has become much less demanding towards potential members than in the past. The paper, however, argues that one must examine the processes of how the norm and policy recommendations of the DAC are mediated domestically. The case of the Czechepublic’s reforms in its foreign aid policy between 2007 and 2010 shows that domestic actors can use the OECD strategically to build support for their own cause and thus achieve seemingly difficult policy reform.