Firm-Specific Determinants of Corporate Lobbying Participation and Intensity

Abstract

Lobbying constitutes a major element in the political strategy of firms seeking favorable regulatory outcomes and is perceived as a source of a firm’s competitive advantage. Recognizing firms’ ability to influence their external environments through reactive and proactive political behavior, this paper analyzes the firm-specific determinants of corporate political activity and intensity. Results from US and Japanese firms indicate that firm size, diversification, and internationalization positively influence the likelihood of a firm being an active lobbyist. While firm profitability influences the "intensity" of lobbying activity, foreign nationality has a negative impact.     

More Rights,Less Power: Labor Standards and Labor Markets in East European Post-communist States

This paper examines changes in labor markets and labor rights for 13 post-communist states of East Central Europe and the Former Soviet Union. It focuses on the simultaneous pressures to increase the flexibility of labor markets and improve labor standards in the years since the collapse of communism. Comparative measures and patterns of both de jure and de facto standards and flexibility are presented, and the roles of key institutional promoters of change are analyzed. I find that a combination of democratic regime type and European Union accession has pulled East European states toward the strengthening of collective labor rights. The effect is strongest on the states that joined the EU in 2004, weaker for those joining in 2007, while the three post-Soviet, non-accession states remain significantly more labor-repressive. Labor market flexibilization has been a more uniform trend in the post-communist region. In the context of this project’s inter-regional comparisons, contemporary Eastern Europe has the strongest labor rights. At the same time, the decline of trade unions and limits of collective bargaining in most post-communist states undermine the effectiveness of transposed EU legislation and bargaining institutions in empowering labor. As shown by the exceptional case of Slovenia, strong unions are necessary to fully enforce rights.     

Determinants of foreign direct investment and entry modes of Polish multinational enterprises: A new perspective on internationalization

This study uses firm data to examine the locational trends of foreign direct investment projects undertaken by Polish companies. The findings of the study are consistent with the evolutionary models of internationalization. Companies in the early stages of internationalization are motivated by markets and resource seeking, whereas efficiency seeking and strategic asset seeking are significant motivators in the advanced stages of internationalization. However, our results with respect to Polish cross-border acquisitions by service companies and greenfield foreign direct investments by industrial or manufacturing companies did not confirm the evolutionary model findings. We found evidence that, in both cases, investments are motivated by the need for efficiency or strategic assets.     

Rise of xenophobic nationalism in Europe: A case of Slovenia

The article focuses on rise of nationalism and xenophobia in Slovenia. It starts by considering the issue of unrecognized minorities in Slovenia (former Yugoslavia nations) that have no minority rights, despite being large groups, as many international organizations for the protection of minorities have pointed out. A particular issue in this relation for Slovenia is the ‘Erased’ – the individuals who did not acquire Slovenian citizenship when Slovenia seceded from federal Yugoslavia – and despite the European Court of Human Rights (ECHR) decision, the Slovenian state has still not recognized their rights, which were violated in the post-independence period. The article also examines two other minorities in Slovenia, the Jews and the Roma. The article finds Slovenia to be a closed, non-globalised society which, in spite of its constitutional declaration to protect the rights of minorities and other national communities, is seeking to retain a politically and culturally homogeneous nation state.     

Depression and parasuicide in refugee and Slovenian adolescents

The association between depression and traumatic experiences, stress, loss, and bereavement is well known. It was expected that Bosnian refugee adolescents who had fled from war zones to Slovenia would develop higher levels of depression than their Slovenian peers without war traumatic experiences. Two years after the beginning of the war in Bosnia, 265 8th-grade refugee students aged 14 to 15 years were assessed with the Children's Depression Inventory (CDI) and compared with a sample of 195 Slovenian students of the same age. The Bosnian refugees showed significantly lower rates of depressive symptomatology despite very high rates of posttraumatic stress symptoms. Slovenian adolescents showed significantly lower self-esteem and greater feelings of inadequacy in the academic field; they were more likely to have feelings of not being loved and more often expressed the wish to kill themselves. Refugees described more sadness, worried about the future and about physical pains, but they do not show lower school achievement or more behavioral problems. The results indicate that the association between traumatic experiences and depressive symptoms is not inevitable, and that other factors including culture and context influences must be taken into account.     

The transition from limited access orders to open access orders in the post-communist Europe

This paper attempts to explain the process of institutional transition of post-communist countries applying conceptual framework proposed by D.C. North, J. J. Wallis, and B. R. Weingast. The first part of the article is devoted to outline the theory of North, Weingast, and Wallis. The second part the theory is used to analyze transformation processes in post-communist countries. An important conclusion of this paper is that cultural, religious and historical factors have crucial impact on formation of new coalitions of elites in the transitions countries. In the countries where Western values were present the transfer of the market and democratic formal institutions was easier. Also, the process of transformation was strongly influenced by external factors, especially the prospect of integration with the European Union, which encouraged elites to take action that benefited the opening of both political and economic markets. These observations suggest that, in general, the success of transformation in transition countries did not depend on the intentional actions of ruling elites.     

Releasing Constraints to Growth or Pushing on a String? Policies and Performance of Mexican Micro-Firms

Using firm-level data from Mexico, this paper investigates the firm characteristics associated with participation in credit markets, access to training, tax payments and membership in business associations. We find that firms which participate in these institutions exhibit significantly higher profits. Moreover, firms that borrow from formal or informal sources and those that pay taxes are significantly more likely to stay in business but firms that received credit exhibit lower rates of income growth. These results persist when firm characteristics that are arguably correlated with unobserved entrepreneurial ability are controlled for. Our findings suggest that the significant within-country differences in firm productivity observed in developing economies are due in part to market and government failures that limit the ability of micro-firms to reach their optimal sizes.     

The national identity of post-communist small states in the process of accession to the European Union: the case of Slovenia

The article discusses, through conceptual elaboration and empirical investigation, the interplay between the perception of smallness and the concept of national identity in the case of Slovenia’s integration into the European Union. Unlike the prevailing literature on Slovenia, the authors do not take Slovenia’s smallness for granted. They argue that, in the particular case of Slovenian identity-building, smallness as an independent variable does not feature frequently at all. The research is based on methodological pluralism, with a special emphasis on political discourse, the mass media and public opinion in Slovenia.     

Corporatism packaged in pluralist ideology: the case of Slovenia

Corporatism has been an influential doctrine in the Slovenian polity since its beginning. After the onset of democratization in the early 1990s, its influence remains strong. Forms of corporatism are embodied in the National Council as the second chamber of parliament, in the chamber system, the system of social partnership and the RTVS (Public Television of Slovenia) Council. It is also present in certain socio-political priorities such as a higher value being placed on partnership over competition, on fairness over human rights, on community over individualism. Social pluralism has always been a part of Slovenian public life. Political pluralism emerged at the end of the 19th century and was never fully developed. There has always been a strong inclination in the political life of Slovenia to organize around interest groups and editorial boards of various publications, a tendency that reveals a plurality of voices but a general unwillingness to fight for political power. It could also be concluded that the development of pluralism in Slovenia relies heavily on corporatism because of the general lack of liberal foundations.     

Continuities and changes in left–right orientations in new democracies: The cases of Croatia and Slovenia

The left–right schema has long been used in analyzing political cleavages in established democracies. This study applies the schema in a post-communist context by examining the structuring of political attitudes in Slovenia and Croatia. Findings from six public opinion surveys in each country during the 1990s demonstrate that left–right orientations in both countries are consistently influenced by religious beliefs, while an additional dimension focusing on democratization is found in Croatia. Economic issues did not constitute a significant axis of political competition. Changes and continuities in party locations and the basis of vote choice according to party supporters' left–right placements are also discussed.     

Welfare reforms and socio-economic trends in the 10 new EU member states of Central and Eastern Europe

The paper reviews recent socio-economic changes in the 10 new EU member states of Central and Eastern Europe and the earlier and latest debates on the emergence of the post-communist welfare state regime. It asks two questions: are the new EU member states more similar to each other in their social problems encountered than to the rest of the EU world? Do they exhibit enough common socio-economic and institutional features to group them into the distinct/unified post-communist welfare regime that deviates from any well-known welfare state typology?The findings of this paper indicate that despite some slight variation within, the new EU countries exhibit lower indicators compared to the EU-15 as it comes to the minimum wage and social protection expenditure. The degree of material deprivation and the shadow economy is on average also higher if compared to the EU-15 or the EU-27. However, then it comes to at-risk-of-poverty rate after social transfers or Gini index, some Eastern European outliers especially the Check Republic, but also Slovenia, Slovakia and Hungary perform the same or even better than the old capitalist democracies. Latvia, Lithuania, Estonia, Romania, Bulgaria, Poland, however, show many similarities in their social indicators and performances and this group of countries never perform better than the EU-15 or the EU-27 averages. Nevertheless, the literature reviews on welfare state development in the CEE region reveal a number of important institutional features in support of identifying the distinct/unified post-communist welfare regime. Most resilient of it are: an insurance-based programs that played a major part in the social protection system; high take-up of social security; relatively low social security benefits; increasing signs of liberalization of social policy; and the experience of the Soviet/Communist type of welfare state, which implies still deeply embedded signs of solidarity and universalism.     

Cyberdemocracy or Potemkin E-Villages? Electronic Governments in OECD and Post-Communist Countries

Abstract

The dramatic increase in the use of the World Wide Web and the Internet in government may foreshadow important changes in the nature of governance. A number of theorists have posited that the adoption of networked information systems is accompanied by inevitable shifts toward democratic government. Others argue that technologies are secondary factors in changes in levels of democracy or types of governance. Our article examines the openness of cabinet-level websites in the Organisation for Economic Co-operation and Development (OECD) and post-communist countries as a measure of an important aspect of governance that has only recently been operationalized. It provides a brief review of other studies in this field and the directions in which they are heading. The article analyzes the effects of political, cultural, economic, and technical factors on openness of cabinet-level websites in OECD and post-communist countries. The question is whether the level of democracy and cultural legacies affect openness of electronic governments. The study employs statistical analysis of a comparative database of national-level public agency websites that is produced by the Cyberspace Policy Research Group (CyPRG). The dependent variable is based on transparency and interactivity scores and availability of cabinet-level websites. The independent variables include Freedom House and Polity indexes of democracy, historical legacy, religious tradition, and the GDP per capita and number of Internet users per 1,000 people. Regression analysis shows that democracy, historical legacies, level of economic development, and religious tradition affect openness of cabinet-level websites in OECD and post-communist countries. This study demonstrates need to distinguish between cyberdemocracy and “Potemkin e-villages,” that is, window-dressing, in electronic governments.     

The Structure and Culture of Post-Communist Civil Society in Latvia

This article provides an account of post-communist civil society in Latvia. Based on original survey data, the structure of civil society is analysed on both individual and organisational levels and cultural aspects are examined. The weakness of post-communist civil society found in much previous research is confirmed when measured on the individual level and in relation to some organisational aspects. The political culture of civil society in Latvia is relatively trusting, tolerant and pro-democratic, but elitist. The specific weaknesses of post-communist civil society can be attributed to the historical heritage of the communist regime as well as the context in which new foreign-funded civil society organisations emerged.     

Legal Environment,Finance Channels and Investment: The East African Example

How do legal environments and finance affect investments by firms in the East African community? Property rights, external and internal finance channels – key conduits of the transmission mechanism from ‘legal environment’ to ‘investment’– individually and interactively affect firms' decision to invest. Firms that perceive secure property rights are more likely to invest in fixed capital. The interactions suggest governments in this community would do well to pursue investment/growth policies that slant heavily towards financial markets deepening while not ignoring enhancement of legal infrastructures. Overall, property rights, external finance, internal finance, firm size, and an export-orientation, are important determinants of the investment decision.     

Outward Orientation,Investment and Finance Constraints: A Study of Indian Firms

We investigate the presence of finance constraints on firms' investment behaviour using Indian manufacturing as a case study. This question becomes particularly interesting in the post-1991 period when substantial market oriented reforms were undertaken. We argue that in the Indian institutional context (especially, the underdeveloped state of bankruptcy laws and restrictive exit procedures) outward orientation rather than size is the relevant criteria for distinguishing firms that may be 'finance-constrained' from those that are not. Using panel data for 718 Indian manufacturing firms for the period 1993-98, we find that exporting firms are less constrained in financial markets than firms which sell primarily to domestic markets.     

Outward Foreign Direct Investment,Exporting and Firm-Level Performance in Sub-Saharan Africa

Abstract

We consider the relationship between how a firm serves foreign markets and performance, using survey data on manufacturing and services firms for African countries. Results for manufacturing industries indicate a clear productivity ordering with firms undertaking outward Foreign Direct Investment (FDI) performing best, followed by exporters and domestically oriented firms. Results for services firms are more nuanced, indicating that while exporters and firms undertaking outward FDI are more productive than domestically oriented firms, there is no significant difference in productivity between these two types of firms (some evidence suggests that the productivity of exporters is larger than that for firms undertaking outward FDI).     

Crucial relationship between the privatized sector and the generic private sector in post-communist privatization: Determinants of economic performance

This article looks at the issue — largely neglected in the transition literature — of the relative weights of the privatized sector and the generic private sector (of de novo private firms) in the emerging private sector of post-communist economies in transition. The present writer posits that the relative weight of each in the aggregate share of a private sector (generally expanding over time as transition progresses) strongly influences economic performance, both during correctional recession and during recovery and expansion period. Another, interrelated issue considered here is the interaction between the evolving institutional framework and the expansion of the generic private sector, that is the most dynamic one in the transition economy. It is true that the interaction between institutions and performance has been a staple of a very large number of books, articles, and papers.However, this article concentrates on one component of a private sector only, that is the generic private sector. But at the same time it looks beyond the ‘Holy Trinity’ of transition (stabilization, liberalization, and privatization) towards a wider institutional framework of political liberty, law and order. The foregoing wider framework, and the emerging general trust, matters as much — if not more — for the present writer as the standard transition program.It is the relative dynamics of both components of the private sector, affected by both standard transition programs and the above-mentioned wider institutional framework, that is of primary importance for the economic performance in post-communist transition. In the last part of the article I will try also to answer, tentatively, the question under which circumstances the wider institutional framework may emerge in the transition process.     

How Responsive are Chinese Exports to Exchange Rate Changes? Evidence from Firm-level Data

This article examines the impact of exchange rate changes on Chinese firms’ decisions on export market entry and export share. Using a large dataset for Chinese firms in 2000–2006, we find that changes in exchange rate levels play a significant role on both export extensive and intensive margins of Chinese firms. Compared to studies using macro data, our firm-level analysis allows us to control for firm and industry heterogeneity. Firm size and location matter. We do not find a difference between foreign and domestic firms in responding to exchange rate changes. Industry heterogeneity is also found to be important.     

FORGETTING DOES (NOT) HURT. Historical Revisionism in Post-Socialist Slovenia

After the fall of socialism, besides the attempts to reach national reconciliation, radical reconfigurations and reinterpretations of the past were used to negotiate local, national and transnational identities and strengthen national agendas. In most of the formerly socialist countries, the historical interpretation significantly resembles the struggle over the legitimacy and authenticity of this representation. The author argues that in post-socialist Slovenia instead of the anticipated democratization and break with ideologically predestined historical work after 1989, at least three competing politically contaminated ways of interpreting the past gained momentum: the so-called liberal-conformist position, which insists that we have to look at the future and forget the traumas of the past; the revisionist standpoint which, at least in Slovenia, is the most aggressive one; and the objectivistic approach practiced by most Slovenian historians after 1991. To do that the author investigates how collective memories are mobilized in general, formal and in particular more personalized and/or emotional narratives and traces the changes in Slovenian memorial landscape divided into categories: the authoritarian type, defined by a desire for direct colonization of the interpretation of the past related to the Second World War; the conciliatory type that tries to achieve “reconciliation”; the conflicting type that clashes with the iconography of an existing partisan monument as an alternative interpretation.     

MNE Affiliation,Firm Size and Exports Revisited: A Study of Information Technology Firms in India

In this study we argue that the export performance of affiliates of multinational enterprises (MNEs) in developing countries is determined differently from that of licensees of foreign firms or of domestic firms. Our empirical results for the information technology sector in India show that exports of MNE affiliates are greater when they have larger foreign equity stakes that bring more tacit knowledge transfer and complementary FDI advantages and when they import more explicit technology from the purchase of licences. Standard export determinants such as firm size and capital intensity do not matter for MNE affiliates, but they do for licensees and domestic firms.