Last Updated:
14/03/2019 - 13:39

Globalisation and Governance: Thresholds for the Impacts of the Main Determinants of Capital Inflows?

Erdal Özmen and Fatma Taşdemir

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This paper investigates whether the impacts of the main push (global financial conditions, GFC) and pull (growth) factors on capital inflows are invariant to endogenously estimated threshold levels for structural domestic conditions (SDC) represented by governance/institutional quality, trade openness, de facto international financial integration and de jure financial openness in emerging market and developing economies. Our results strongly suggest that, for all the components of capital inflows, the impact of the domestic pull factor is substantially much higher for the episodes of better governance, higher trade and de jure financial openness and de facto international financial integration. The sensitivity of non-FDI and aggregate inflows to GFC is highly significant and tends to be considerably higher for countries with better SDC. FDI inflows are found to be basically determined by the domestic pull factor across all these regimes. The impact of GFC on FDI inflows appears not to considerably change across the SDC.

English Skills, Labour Market Status and Earnings of Turkish Women

Antonio Di Paolo and Aysit Tansel

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In this paper, we investigate the effect of the level of English skills on the labour market outcomes of Turkish women, using data from the Adult Education Survey of 2007. By adopting a bivariate equation framework, we jointly model the effect of English skills on labour market status and, conditional on being a wage earner, on monthly earnings and occupational status. The multinomial equation that explains labour market status allows for a different effect of language knowledge on the probability of being employed, unemployed but actively looking for a job, an unpaid family worker or involved in household tasks. The results indicate that being proficient in English is conditionally associated with a higher probability of being employed as a wage earner and, to a lesser extent, unemployed but looking for a job, whereas it decreases the likelihood of being involved in household tasks. Moreover, there is a significant conditional correlation between having a high level of skills in English and earnings, which is only modestly reduced when job-related variables and (especially) occupation dummies are included as additional controls. Indeed, being proficient in English barely affects occupational status when selection into employment status is controlled for. Therefore, the knowledge of foreign languages (in this case English) seems to stimulate labour market participation and earnings capacity, but does not substantially affect the occupational position of women in the Turkish labour market.