FALL 2010
VOLUME11, NUMBER2

HUNT FOR TWIN DEFICITS: CURRENT ACCOUNT AND FISCAL BALANCE IN TRANSITION ECONOMIES

Aleksandr V Gevorkyan

This paper is a critical effort assessing the twin deficits concept in the context of the transition economies of the Commonwealth of Independent States. Correlations between current account and fiscal balance must be interpreted with caution. Actual political economy circumstances in the region play important role in explaining external trade positions and public spending in both net exporter and net importer country groups. There are clearly two periods within a bigger transition time frame: early 1990's reforms and post Russian financial crisis through early 2000's. Cumulative weight of such factors, coupled with empirical evidence raises more questions than answers, offering no solid theoretical or empirical grounds for the case of twin deficits in the post-socialist economies of the CIS. Following standard and extended empirical analysis the paper identifies key policy guidelines for the selected transition economies. A more qualitative approach prompts an investigation into structural problems of transition, such as household consumption patterns and its relation to current account and nature of fiscal expenditure. That is the case in the post-socialist transforming economies with consumer societies.


https://doi.org/10.51240/jibe.2010.2.1          PDF

ASSESSING THE PERFORMANCE OF TELECOMMUNICATION INDUSTRY IN INDIA: A DATA ENVELOPMENT ANALYSIS

Seema Sharma, Kirankumar Momaya, and K Manohar

Rapid growth of telecommunications in India has been creating opportunities for many players from Asia, Europe and other parts of world. Relative assessment of efficiencies can be used to enhance productivity and competitiveness. In this study an attempt is made to evaluate competitiveness of the telecom industry in India focusing on the efficiency. Input oriented data envelopment analysis is used to measure the relative technical and scale efficiencies of 10 service providers. Further, using output oriented model, the efficiency analysis is extended to 23 service circle areas. From the analysis performed on service providers the technically and scale efficient firms were identified. Technical and scale efficiency were assessed at circle level also. The findings confirm some assumptions and hint at several competitiveness implications for leadership in firms and government.


https://doi.org/10.51240/jibe.2010.2.2          PDF

BOARD COMPOSITION AS A LINKAGE WITH ENVIRONMENTAL CHANGE DURING FINANCIAL CRISIS: A CASE OF KOREAN BANK INDUSTRY

Jiyeon Kim, Dong Kee Rhee, Namgyoo K Park, and Hyojung Kim

This study looked into the process of a firm actively adapting to the environmental shift and generating good performances by acquiring relational capital as well as personal expertise through the board members. The effect of board composition on firm‘s performance was

measured, specifically focusing on personnel with political background, accounting specialists, and foreign company related personnel. The results indicate that firms under extreme environmental change actively utilize their network of board of directors, and such efforts substantially affect firm performance. The implication of this study is in that it empirically verified the relationship between board composition and firm performance based on resource.


https://doi.org/10.51240/jibe.2010.2.3          PDF

THE DIAMOND APPROACH TO THE COMPETITIVENESS OF KOREA'S DEFENSE INDUSTRY

Hee-Jung Moon

Despite the control of U.S. and poor domestic infrastructures, the Korean defense industry has been advanced at relatively faster trajectory owing to the multiple circumstantial factors such as enthusiastic policy of the president‘s concrete will, expertise of technocrats, drastic increase of scientists, efficient interrelationship with the heavy chemical industry, and systematic government support. However, this sector‘s competitiveness is controversial for various reasons. Changes in the internal and external environment are calling for strategic developments of a new framework for competitive factors. The purpose of this study is to explore what constitutes sources of competitiveness of Korea‘s defense industry and how it could be achieved effectively in a relatively short period of time. This

study adopts Porter‘s Diamond Model as a theoretical framework to evaluate competitiveness of the defense industry in a more comprehensive and strategic way. Along with this model, this study uses mainly extensive literature reviews due to limitations in reliable examples of successful firms and interviews with field practitioners in the Korean defense industry.


https://doi.org/10.51240/jibe.2010.2.4          PDF

INTEGRATION THROUGH INTERMEDIATE GOODS: A COMPARISON OF G-7 OPENNESS TO DEVELOPING COUNTRY EXPORTS

John Berdell and Animesh Ghoshal

The fragmentation of manufacturing in G7 economies has substantially altered the way in which developing countries participate in world trade and production. Commodity chains and intertwined production networks have become increasingly important as vectors for the diffusion of technology and integration of developing countries into the world economy. We establish a set of simple and transparent benchmarks to compare and contrast the speed and extent to which production networks have integrated each of the G7 with developing economies through the importation of intermediate goods and examine these comparative indicators of G7 integration at both regional and global levels. We examine both total and intermediate goods trade flows and calculate the income-expenditure elasticity of developing-country sourced imports with respect to G7 incomes and also the elasticity of imported intermediate goods with respect to manufactured output. Within the G7, we find three tiers of openness to intermediate goods produced by developing countries, led by Germany and the US. Regional integration exhibits a clear pattern in which Central Europe appears to be integrating with developed Europe, Mexico with North America, and only East Asia is simultaneously integrating with North America, Europe and Japan.


https://doi.org/10.51240/jibe.2010.2.5          PDF