GIKA 2019 Chile

Issues

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Volume 12 (2018) Volume 11 (2017) Volume 10 (2016) Volume 9 (2015) Volume 8 (2014) Volume 7 (2013) Volume 6 (2012) Volume 5 (2011) Volume 4 (2010) Volume 3 (2009) Volume 2 (2008) Volume 1 (2007)

Volume 12 Issue 3 (2018)

Location Theory and Multi-Criteria Decision Making: An Application of the MOORA Method original article

pp. 241-252 | First published in 30 September 2018 | DOI:10.5709/ce.1897-9254.275

Willem K. M. Brauers

Abstract

The first systematic research on Location Theory dates back to 1826. Quantitative approaches came much later. On the supply side extensive Input-Output Tables can be mentioned and on the demand side the optimization by Multi-Criteria Decision Making. The advantages of Input-Output Tables for location opportunities on a regional and urban basis have to be emphasized, whereas the link is made between Input-Output and Multi-Criteria Optimization. MOORA, Multi-Objective Optimization by Ratio Analysis, is composed of two methods: Ratio Analysis and Reference Point Theory and responds to the different conditions of robustness needed for optimization. This approach attempts to localize in an optimal way a certain project facing different indicators, criteria or objectives sometimes originating from different groups or individuals. Here however type and importance of objectives and alternatives were only simulated. The real stakeholders to be considered are rather the national and local authorities, the contributing firms and their personnel. In the production sphere consumer sovereignty was only indirectly involved. If consumers, via consumer organizations and trade unions, were directly involved, other claims could emerge. The simulation used was limited in its applications. Clearly if this simulation has no practical consequences, it still provides a learning experience with the use of the MOORA Method in its double composition.

Keywords: Location Theory, Input-Output Analysis, MOORA, MULTIMOORA, Objectives, Alternatives, Simulation, Ratio Analysis, Reference Point Method

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Implementation-Neutral Causation in Structural Models original article

pp. 253-268 | First published in 30 September 2018 | DOI:10.5709/ce.1897-9254.276

Stephen F. LeRoy

Abstract

Analysts associated with the Cowles Commission attached great importance to the distinction between structural and reduced-form models: in their view structural models, but not reduced-form models, allow the analysis of causal relations. They did not present clear justification for this view. Here we show that this insight is correct, and make the demonstration of it precise. Causal relations are shown to depend on parameter restrictions that are explicit in the structural form, but not in the reduced form when the coefficients are interpreted as unrestricted constants. The requisite parameter restrictions are those associated with implementation-neutral causation. A graphical procedure is outlined that identifies causal orderings and also the ordering based on implementation-neutral causation. The same procedure applied to reduced form models produces the implementation-neutral causal ordering only if the parameter restrictions are explicitly incorporated in the reduced form. The analysis is applied in investigating the validity of the causal Markov condition.

Keywords: causation, correlation, regression, Cowles, implementation neutrality, external variables, internal variables

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Tolerable Level of Corruption for Foreign Direct Investment in Europe and Asia original article

pp. 269-284 | First published in 30 September 2018 | DOI:10.5709/ce.1897-9254.277

Anselm Komla Abotsi

Abstract

In 2009, Foreign Direct Investment (FDI) flows to developed countries experienced the largest decline among all regions and sub-regions. However, South, East and Southeast Asia showed the smallest decline among developing economies and remained the largest recipient of FDI inflows. Meanwhile, approximately 68% of the countries in Asia scored less than the tolerable level of corruption for investment (TLCI) in Africa (-0.27) over recent years. Moreover, corruption has been observed to be significant in virtually all Asian countries, but, despite this, the region remains the number one global investment destination. This study, therefore, estimates the TLCI in Asia and Europe to enable comparison across these regions. Secondary data from the World Development Indicators were used in this study. The frequency of the data is annual, and it is available from 1996 to 2013. The dynamic panel data estimation technique was deployed while controlling for other variables. The estimated TLCIs for Europe and Asia are 0.534 and -0.735, respectively, on the control of corruption scale, which ranges from approximately -2.5 (weak) to 2.5 (strong). Despite the lower TLCI in Asia, the region is still able to attract relatively more FDI inflow than Africa. This scenario may be attributed to the presence of sound policy factors that drive FDI inflows. Another reason may be due to the nature, scope, social role and the perception of corruption across these regions.

Keywords: corruption, tolerable level of corruption for investment, foreign direct investment, institutions

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Design Mentoring Approach in Companies in Poland original article

pp. 285-300 | First published in 30 September 2018 | DOI:10.5709/ce.1897-9254.278

Małgorzata Baran

Abstract

In the contemporary world of business, mentoring has become common practice. Its objectives include the personal and professional development of employees, training new employees, nurturing talents, planning for successions and developing leaders. A literature review has enabled the author to conclude that a structured, systematic, coordinated and evaluated mentoring program helps businesses achieve the expected results, i.e., the construction of lasting mentoring relationships leading to the realization of intended goals and benefits. The question therefore arises, how do companies build effective mentoring programs? The aim of the article is to determine the conditions for building effective mentoring programs. The research was conducted on a non-probable sample of 30 companies operating in Poland that have implemented mentoring programs within the last 3-5 years. Triangulation of research methods was applied. PAPI and IDI methods were used to survey representatives of chosen companies who manage mentoring programs. The effective mentoring program is achieved by defining the roles of participants in the mentoring process precisely and by defining their competencies, responsibilities and objectives. Furthermore, it is important to establish transparent rules for participation in the mentoring program, i.e., participation criteria for mentors, selection criteria for mentees and placement criteria for bringing participants together into suitable pairs or groups. It is crucial to provide mentoring participants with support in the form of advice, consultation before and between mentoring sessions, and monitoring their expectations of and satisfaction from participating in the program.

Keywords: formal mentoring, mentorship, effectiveness, mentoring programs

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The External Sector Vulnerability Monitoring Index (Λ): The Case of Chinese and Asean-5 Economies original article

pp. 301-314 | First published in 30 September 2018 | DOI:10.5709/ce.1897-9254.279

Mario Arturo Ruiz Estrada, Diwa Samad, Yew Joe Ho

Abstract

This paper introduces an alternative indicator to evaluate the external sector behavior of a country or region. The objective of this indicator, titled “The External Sector Vulnerability Monitoring Index” (henceforth ESVM) (λ), is to offer policy-makers and researchers a new analytical tool to study the external sector trends and stages of any country from a global perspective. The ESVM-index (λ) is not intended to be a forecasting model. It is focused on showing the past and present economic situation in any country’s external sector performance. It can provide a general idea of the situation and evolution of the foreign sector performance of any country. Therefore, the application of the ESVM-index (λ) is based on the characteristics, conditions and historical moments that any country presents in its external sector development. ESVM-index (λ) acts as a simulator that allows the application of a series of different scenarios and phases of external sector performance of any country. In our case, we apply the external sector vulnerability monitoring index (λ) on the Chinese and ASEAN-5 economies.

Keywords: Trade liberalization, Openness, International Trade, ASEAN, China

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Scientific research activity and GDP. An analysis of causality based on 144 countries from around the world original article

pp. 315-336 | First published in 30 September 2018 | DOI:10.5709/ce.1897-9254.280

Wiesław Dębski, Bartosz Świderski, Jarosław Kurek

Abstract

Using the Granger methodology, this paper presents the causal relationship between scientific research activity, expressed as the number of significant publications, and gross domestic product (GDP). With causality tests, this relationship is investigated from two points of view: for each individual country (144 were selected) and for each specific academic field (28 were selected). Considering annual data from 1996 to 2012, two hypotheses are tested. The first suggests that scientific research activity in a given country has a significant effect on GDP; the second verifies how much each specific field of scientific research activity affects this growth. Our research confirmed the existence of this relationship for a relatively large number of countries, especially highly developed countries and those with a high potential both in the fields of scientific research activity and in GDP. Moreover, this study identifies the most significant fields of this activity that affect GDP. Additionally, the article includes an empirical study regarding how information related to the number of significant scientific publications influenced the quality of Polish GDP forecasts for 2011-2012.

Keywords: Granger causality, weighted least squares method, number of significant publications, GDP, forecast quality

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How Taxes, Education and Public Capital Influence Economic Growth in Poland original article

pp. 337-360 | First published in 30 September 2018 | DOI:10.5709/ce.1897-9254.281

Michał Konopczyński

Abstract

This paper investigates the relationship between economic growth in Poland and selected elements of fiscal policy and private spending on education. We use the Mankiw-Romer-Weil model, augmented with learning-by-doing and spillover-effects and with concepts from the literature on optimal fiscal policy. We demonstrate that, from 2000-2015, economic growth in Poland was primarily driven by rapid improvements in the level of human capital (at 4.4% per annum) coupled with a rapid increase in public capital (6.0%) and secondarily due to the accumulation of private capital (2.1% annually). Simulations of tax cuts suggest that a synchronized reduction of all tax rates by 5 percentage points (pp) in Poland should increase the annual GDP growth rate by approximately 0.32 pp. Increasing (private or public) spending on education by 1 pp of the GDP would increase the growth rate by approximately 0.3 pp. We also analyze the effects of increasing public capital. The stock of public capital in Poland is still below the optimal level, and it may be beneficial to increase investment in public capital at the cost of public consumption (which is intuitively clear) and – to some extent – at the cost of public spending on education.

Keywords: optimal fiscal policy, income taxes, labor taxes, capital taxes, economic growth, human capital, public capital

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