If co-existing parallel markets are efficient, then arbitrage will maintain a correct pricing relationship. A related question is whether two parallel emerging markets offering more or less the same securities but using different institutional designs, can behave as a single, fully integrated...

We use new firm-level data to examine the effects of spinoffs and privatization on corporate performance in a rapidly emerging market economy. Unlike the existing literature, which analyzes spinoffs almost exclusively in advanced economies, we control for accompanying ownership changes and the...

The present paper uses a survey of 1062 Czechs and 524 Slovaks to ask why people evade taxes. We maintain that the Czech and Slovak Republics are “twins” separated at birth and that divergences between these countries since their separation in 1992 can explain divergences in their rates of...

We use a dataset of 1062 individuals from the Czech Republic to forecast the evolution of tax evasion in that country. We ask each respondent how intensely (never, sometimes, often) he evaded taxes in 1995, 1999, and 2000, to calculate probabilities the average individual will move between these...

An easy and popular method for measuring the size of the underground economy is to use macro-data such as money demand or electricity demand to infer what the legitimate economy needs, and then to attribute the remaining consumption to the underground economy. Such inferences rely on the...

Mismeasurement of inflation is likely to be more severe in a transition economy than in a more stable environment. Reasonable estimates of the size of the inflationary bias in the Czech Republic suggest that conventionally reported declines in real output and living standards during the...

The link between informed trading and the bid-ask spread has been the focus of abundant literature and some authors feared that a large amount of informed trading might lead to shutdown of markets. We explore this issue using data from the Czech Republic. Our estimates confirm that the share of...

We analyze the effects of ownership type and concentration on performance of a population of firms in a model large-scale privatization economy. Using specifications based on first-differences and unique instrumental variables, we find that few types of private ownership improve dynamic...

IV estimates of the link between profits and investment in the Czech Republic find a complex relationship. While firms may occasionally be credit rationed or face soft budget constraints, investments generally flow to industries with the greatest profit potential or need for recapitalization

A series of studies confirm results presented Filer and Hanousek (2000) suggesting that mismeasurement of inflation during the transition is a serious problem, on the same relative order of magnitude (and greater in absolute magnitude) as in advanced market economies. Overall, inflation has been...