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 diagenesis and palaeomagnetism of permian and triassic sediments from central Spain

Detailed diagenetic and palaeomagnetic studies have been made of Permian and Triassic rocks from the Iberian Cordillera, Spain. Five stratigraphical units comprising the Autunian, Saxonian, Buntsandstein, Muschelkalk, and Keuper have been studied in a number of sections which have been well documented sedimentologically. Autuninan rocks have a characteristic remanence which is exclusively reversed and corresponds to the Kiaman Interval. The pole position identified is consistent with previous studies, which indicate the rotation of Iberia in post-Triassic times. The Saxonian facies show complex multicomponent magnetizations; no polarity zonation can be resolved. The Buntsandstein is remarkable in that much of it is remagnetised in a direction similar to the present-day local geomagnetic field direction. The secondary remanence is carried by fine-grained haematite which has been formed as a result of carbonate dissolution associated with structural inversion of the Iberian Cordillera. Dating of diagenetic events associated with this remagnetization is also possible. Fragments of primary remanence are preserved in some fine-grained lithologies of the Buntsandstein. These indicate that normal and reversed zones of magnetization were originally present. The magnetization of the Muschelkalk and Keuper carbonates is also complex; secondary components similar to those of the Buntsandstein are present but there is evidence that primary components were predominantly normal during Karnian times.

The missing ingredient:inter-municipal cooperation and central-local relations in the UK

The thrust of the argument presented in this chapter is that inter-municipal cooperation (IMC) in the United Kingdom reflects local government's constitutional position and its exposure to the exigencies of Westminster (elected central government) and Whitehall (centre of the professional civil service that services central government). For the most part councils are without general powers of competence and are restricted in what they can do by Parliament. This suggests that the capacity for locally driven IMC is restricted and operates principally within a framework constructed by central government's policy objectives and legislation and the political expediencies of the governing political party. In practice, however, recent examples of IMC demonstrate that the practices are more complex than this initial analysis suggests. Central government may exert top-down pressures and impose hierarchical directives, but there are important countervailing forces. Constitutional changes in Scotland and Wales have shifted the locus of central- local relations away from Westminster and Whitehall. In England, the seeding of English government regional offices in 1994 has evolved into an important structural arrangement that encourages councils to work together. Within the local government community there is now widespread acknowledgement that to achieve the ambitious targets set by central government, councils are, by necessity, bound to cooperate and work with other agencies. In recent years, the fragmentation of public service delivery has affected the scope of IMC. Elected local government in the UK is now only one piece of a complex jigsaw of agencies that provides services to the public; whether it is with non-elected bodies, such as health authorities, public protection authorities (police and fire), voluntary nonprofit organisations or for-profit bodies, councils are expected to cooperate widely with agencies in their localities. Indeed, for projects such as regeneration and community renewal, councils may act as the coordinating agency but the success of such projects is measured by collaboration and partnership working (Davies 2002). To place these developments in context, IMC is an example of how, in spite of the fragmentation of traditional forms of government, councils work with other public service agencies and other councils through the medium of interagency partnerships, collaboration between organisations and a mixed economy of service providers. Such an analysis suggests that, following changes to the system of local government, contemporary forms of IMC are less dependent on vertical arrangements (top-down direction from central government) as they are replaced by horizontal modes (expansion of networks and partnership arrangements). Evidence suggests, however that central government continues to steer local authorities through the agency of inspectorates and regulatory bodies, and through policy initiatives, such as local strategic partnerships and local area agreements (Kelly 2006), thus questioning whether, in the case of UK local government, the shift from hierarchy to network and market solutions is less differentiated and transformation less complete than some literature suggests. Vertical or horizontal pressures may promote IMC, yet similar drivers may deter collaboration between local authorities. An example of negative vertical pressure was central government's change of the systems of local taxation during the 1980s. The new taxation regime replaced a tax on property with a tax on individual residency. Although the community charge lasted only a few years, it was a highpoint of the then Conservative government policy that encouraged councils to compete with each other on the basis of the level of local taxation. In practice, however, the complexity of local government funding in the UK rendered worthless any meaningful ambition of councils competing with each other, especially as central government granting to local authorities is predicated (however imperfectly) on at least notional equalisation between those areas with lower tax yields and the more prosperous locations. Horizontal pressures comprise factors such as planning decisions. Over the last quarter century, councils have competed on the granting of permission to out-of-town retail and leisure complexes, now recognised as detrimental to neighbouring authorities because economic forces prevail and local, independent shops are unable to compete with multiple companies. These examples illustrate tensions at the core of the UK polity of whether IMC is feasible when competition between local authorities heightened by local differences reduces opportunities for collaboration. An alternative perspective on IMC is to explore whether specific purposes or functions promote or restrict it. Whether in the principle areas of local government responsibilities relating to social welfare, development and maintenance of the local infrastructure or environmental matters, there are examples of IMC. But opportunities have diminished considerably as councils lost responsibility for services provision as a result of privatisation and transfer of powers to new government agencies or to central government. Over the last twenty years councils have lost their role in the provision of further-or higher-education, public transport and water/sewage. Councils have commissioning power but only a limited presence in providing housing needs, social care and waste management. In other words, as a result of central government policy, there are, in practice, currently far fewer opportunities for councils to cooperate. Since 1997, the New Labour government has promoted IMC through vertical drivers and the development; the operation of these policy initiatives is discussed following the framework of the editors. Current examples of IMC are notable for being driven by higher tiers of government, working with subordinate authorities in principal-agent relations. Collaboration between local authorities and intra-interand cross-sectoral partnerships are initiated by central government. In other words, IMC is shaped by hierarchical drivers from higher levels of government but, in practice, is locally varied and determined less by formula than by necessity and function. © 2007 Springer.

Institutional reforms, productivity and profitability:from rents to competition?

This paper explores the divergent effects of institutional reforms on firm's productivity and profits. To assess this empirically, we investigate the impact of various components of economic liberalisation on the performance of firms from Central and Eastern European countries from 1998 to 2006. The impact of reforms on profitability vis-à-vis productivity differs, which we interpret as an indication that profitability is an ambiguous measure of performance: one needs to distinguish between unproductive rents and productivity-based quasi-rents. We find that competition-enhancing liberalisation measures have more impact on state owned firms as compared with domestic and foreign owned firms. © 2012 Association for Comparative Economic Studies.

From transferred technology to technological capability:a framework for examining the acquisition of technological capability by Chinese enterprises

This paper conceptualises the enhancement of technological capability by firms, following international technology transfer, as an evolutionary process. During this process, the existing technological, managerial and other complementary resources may require restructuring. Since China is in transition from central planning to market orientation, the organisational and managerial practices of Chinese firms are different from those of international technology suppliers. Resourcebased and evolutionary theories of the firm, which provide insights into the evolution of structures, mechanisms, skills, experiences and technical know-how, have been applied to outline the processes of acquiring technological capability. Selected case studies have been used to illustrate the issues and the framework provides guide for further empirical work.

Modelling of transient heat transfer in annealing furnaces

This is a study of heat transfer in a lift-off furnace which is employed in the batch annealing of a stack of coils of steel strip. The objective of the project is to investigate the various factors which govern the furnace design and the heat transfer resistances, so as to reduce the time of the annealing cycle, and hence minimize the operating costs. The work involved mathematical modelling of patterns of gas flow and modes of heat transfer. These models are: Heat conduction and its conjectures in the steel coils;Convective heat transfer in the plates separating the coils in the stack and in other parts of the furnace; and Radiative and convective heat transfer in the furnace by using the long furnace model. An important part of the project is the development of numerical methods and computations to solve the transient models. A limited number of temperature measurements was available from experiments on a test coil in an industrial furnace. The mathematical model agreed well with these data. The model has been used to show the following characteristics of annealing furnaces, and to suggest further developments which would lead to significant savings: - The location of the limiting temperature in a coil is nearer to the hollow core than to the outer periphery. - Thermal expansion of the steel tends to open the coils, reduces their thermal conductivity in the radial direction, and hence prolongs the annealing cycle. Increasing the tension in the coils and/or heating from the core would overcome this heat transfer resistance. - The shape and dimensions of the convective channels in the plates have significant effect on heat convection in the stack. An optimal design of a channel is shown to be of a width-to-height ratio equal to 9. - Increasing the cooling rate, by using a fluidized bed instead of the normal shell and tube exchanger, would shorten the cooling time by about 15%, but increase the temperature differential in the stack. - For a specific charge weight, a stack of different-sized coils will have a shorter annealing cycle than one of equally-sized coils, provided that production constraints allow the stacking order to be optimal. - Recycle of hot flue gases to the firing zone of the furnace would produce a. decrease in the thermal efficiency up to 30% but decreases the heating time by about 26%.

Melting of polymers

The project set out to investigate the relative effectiveness of thermal conductive heating (from external resistance heaters) and viscous heating in the heating (and melting) of low density polyethylene. A model system was used in order to simplify the mathematical analysis. A theory was developed to describe both processes in the model apparatus. The results showed large differences between the experimental and predicted results at low melt temperatures (the predicted results were much greater than the experimental) . Analysis of the results indicated that the apparatus was probably not producing the required shear rates in the sample. The theory appeared to be satisfactory, in that it did not over estimate the viscous heating to any significant extent. The theoretical results could therefore be considered to be a reasonable estimate of the viscous heating.

The challenges of delivering climate change policy at the sub-national level

It is asserted that sub-national government has a key role in responding to climate change. Drawing on a case study of metropolitan authorities in the English Midlands, this article examines the contribution of local authorities and their partners in delivering climate change targets agreed upon with central government. Rather than achieving fundamental change, actions were hampered by competing priorities, fragmented responsibilities, limited resources and difficulties in measuring outcomes. Nevertheless, in light of public expenditure cuts and the current coalition government's commitment to free councils from central targets, gaining support for local climate change actions will become even more challenging.