Essays on transitional economies
Essays on transitional economies
In this thesis we investigate the effect of imperfections in credit and financial markets during the transition process that is characterizing Eastern European countries. The analysis is carried on on three levels: the first level is microeconomic and investigates the effects of credit market imperfections on firms' restructuring choices. We show how the need to sort out firms' features in a credit relationship may trigger the incentive for the firms to signal their type to the banks through initial restructuring choices and through lay offs. The analysis helps to understand the unexpected high dynamism in restructuring choices made by state owned firms and is strongly supported by empirical evidence.
The second level is macroeconomic and looks at the long run development of the economy and the evolution of the distribution of wealth. The analysis helps to explain how financial market imperfections affect occupational choices and the long run evolution of income. We show that those imperfections do matter for the long run accumulation of capital but also that they can explain only part of the observed cross country variability of income.
We consider also the interactions between financial market imperfections and soft budget constraints in a model of occupational choice. We show that soft budget constraints, while negative per se, can reduce the degree of imperfections present in the economy resulting, under some conditions, in a higher level of output.
The third level is empirical and tries to quantify precisely the relevance of such imperfections using a panel data of 1600 Hungarian firms over a period of 5 years. We analyse their borrowing decisions and investigate whether or not there exists an optimal capital structure for them and whether there are constraints to the achievements of this optimal capital structure.
The introductory chapter provides a survey of the relevant literature and a framework for a clear identification of the arguments defined in the subsequent chapters.
University of Southampton
Colombo, Emilio
d2a3be3f-8278-4c62-9d62-8614c87cb228
2000
Colombo, Emilio
d2a3be3f-8278-4c62-9d62-8614c87cb228
Colombo, Emilio
(2000)
Essays on transitional economies.
University of Southampton, Doctoral Thesis.
Record type:
Thesis
(Doctoral)
Abstract
In this thesis we investigate the effect of imperfections in credit and financial markets during the transition process that is characterizing Eastern European countries. The analysis is carried on on three levels: the first level is microeconomic and investigates the effects of credit market imperfections on firms' restructuring choices. We show how the need to sort out firms' features in a credit relationship may trigger the incentive for the firms to signal their type to the banks through initial restructuring choices and through lay offs. The analysis helps to understand the unexpected high dynamism in restructuring choices made by state owned firms and is strongly supported by empirical evidence.
The second level is macroeconomic and looks at the long run development of the economy and the evolution of the distribution of wealth. The analysis helps to explain how financial market imperfections affect occupational choices and the long run evolution of income. We show that those imperfections do matter for the long run accumulation of capital but also that they can explain only part of the observed cross country variability of income.
We consider also the interactions between financial market imperfections and soft budget constraints in a model of occupational choice. We show that soft budget constraints, while negative per se, can reduce the degree of imperfections present in the economy resulting, under some conditions, in a higher level of output.
The third level is empirical and tries to quantify precisely the relevance of such imperfections using a panel data of 1600 Hungarian firms over a period of 5 years. We analyse their borrowing decisions and investigate whether or not there exists an optimal capital structure for them and whether there are constraints to the achievements of this optimal capital structure.
The introductory chapter provides a survey of the relevant literature and a framework for a clear identification of the arguments defined in the subsequent chapters.
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Published date: 2000
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Local EPrints ID: 464283
URI: http://eprints.soton.ac.uk/id/eprint/464283
PURE UUID: c47de8a1-a306-4aae-9f05-bba405fc397c
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Date deposited: 04 Jul 2022 21:55
Last modified: 16 Mar 2024 19:23
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Author:
Emilio Colombo
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