This paper presents a model of opportunistic behaviour in decentralized economic exchange and considers the impact of inadequate institutional framework of formal contract enforcement on economic performance. It is shown that (i) when the number of cheating traders is sufficiently large,...

Since the beginning of transition, Eastern European and Central Asian (ECA) countries compete against one another in attracting foreign investors by offering ever more generous incentive packages. Recent empirical research provides though little support for the idea that foreign direct...

Summary We study the individual-level determinants of bribing public officials. Particular attention is paid to the issue of respondents’ non-random selection into contact with public officials, which may result in biased estimates. Data come from the 2010 Life in Transition Survey, covering...

This article examines difficulties with bureaucratic reform for transitional economies, drawing on the American experience. Bureaucracies have incentive and performance problems that could retard economic growth in transitional economies. A remedy for a politicized corrupt bureaucracy is an...

Boettke and Butkevich argue that a vibrant society is an entrepreneurial society. Entrepreneur- ial effectiveness is a function of the free movement of economic actions – their alertness to opportunities for mutual gain, and their sense of when and where to enter and exit a market. Boettke and...

The classical liberal approach to deregulation is based on the consecutive elimination of state regulatory activities and their substitution by competitive market structure. Increasing competition accompanied with decreasing arbitrary state agencies’ interventions will undoubtedly cultivate the...

In almost all countries, the transition from a centrally planned economy to a market economy caused high unemployment. The governments attempted to ease the changeover to a market economy for the unemployed by introducing several passive and active labour market policies. This paper first points...

We examine the behavior of the real exchange rates of nine transition economies during the 1990s. We propose an empirical model rationalized on the basis of standard economic models in the tradition of Mundell-Fleming-Dornbusch and Harrod-Balassa-Samuelson, allowing explicitly for real interest...

Purpose – The purpose of this paper is to provide estimates of factor income shares for 79 developed, developing and transition economies representing close to 90 percent of the world output and to test for income share convergence. Design/methodology/approach – The paper uses data from the...

Firms’ strategic responses to environmental shifts under conditions of uncertainty in the wake of institutional changes are far from understood. We utilize data from over 1,200 firms in seven Central Eurasian transition economies to examine the extent to which institutional inefficiency is...