en pl
en pl

Central European Management Journal

Zobacz wydanie
Rok 2015 
Tom 23 
Numer 3

Analysis of Ineffectiveness Arising in “Investor-government” Relations

Dmytro, B. Sokolovskyi
Institute of Industrial Economics of National Academy of Sciences of Ukraine

Olena , V. Sokolovska
Research Institute of Financial Law

2015 23 (3) Central European Management Journal

DOI 10.7206/mba.ce.2084-3356.150

Zawartość artykułu

Abstrakt

behavior of investors and government in the process of decision-making related to financing designed
to reduce risks in investment activity.

Methodology: Considering the interdependent type (nature) of interactions between related parties,
game theory tools were used to model such interactions. Much attention was directed to search for
parameters of interaction leading to certain Nash equilibriums in pure strategies. The formal results
obtained with the model were verified by statistical analysis.
Findings: Analysis showed that the rational behavior of related parties can lead to unexpected
results. Powerful investors will aim to work in socially-oriented economies, whereas primarily
small investors will operate in most liberal economies with a minimum tax burden but with a higher
level of risk. As for governments’ behaviors, the images are the same: small economies tend to
liberalize their tax systems and to secure investment faster than powerful ones. Empirical verification
based on statistical data of groups of countries generally confirmed the conclusions. These
formal and logical conclusions were from statistical analysis of 124 countries divided into 5 groups:
OECD countries, post-socialist countries, Latin American countries, APAC countries and ACP
countries. Provided that the more powerful ones are covered economies, there was stronger interdependence
between the size of economies and tax burden and also between total investment and
tax burden, where this dependence is positive.

Originality: The results obtained used Nash equilibriums in pure strategies as models of behavioral
norms to define behaviors of related parties and also to explain assumptions concerning the
behaviors of investors and government.

Powiązania

  1. Agnew, J. (2003). Inefficient Choices in 401(k) Plans: Evidence from Individual Level Data. Manuscript in preparation. The College of William and Mary. [Google Scholar]
  2. Algozhina, A. (2012). Monetary and fiscal policy interactions in an emerging open economy exposed to sudden stops shock: a DSGE approach. FIW Working Paper, 94. [Google Scholar]
  3. Anand, P. and Cowton, C.J. (1993). The ethical investor: Exploring dimensions of investment behavior. Journal of Economic Psychology, 14(2): 377–385, http://dx.doi.org/10.1016/0167-4870(93)90007-8 [Google Scholar]
  4. Barbosa, D., Carvalho, V.M. and Pereira, P.J. (2013). The Interaction between Firms and Government in the context of Investment Decisions: A Real Options Approach. FEP Working Papers, 507. [Google Scholar]
  5. Besley, T. (1994). How Do Market Failures Justify Interventions in Rural Credit Markets? The World Bank Research Observer, 9(1): 27–47, http://dx.doi.org/10.1093/wbro/9.1.27 [Google Scholar]
  6. BIS: (2011). International Trade and Investment – the Economic Rationale for Government Support. BIS Economics Paper, 13. [Google Scholar]
  7. Cao J., Hu, L. and Yao, Q. (2014). Game Analysis of Reverse Supply Chain Based on Government [Google Scholar]
  8. Regulation. Advanced Materials Research, 915–916: 1528–1531,http://dx.doi.org/10.4028/www.scientific.net/AMR.915-916.1528 [Google Scholar]
  9. Carlin, B.I., Gervais, S. and Manso, G. (2013). Libertarian Paternalism, Information Production, [Google Scholar]
  10. and Financial Decision Making. Review of Financial Studies, 26: 2204–2228,http://dx.doi.org/ 10.1093/rfs/hht025 [Google Scholar]
  11. Cassar, G. and Friedman, H. (2007). Does overconfidence Affect entrepreneurial Investment? Wharton Research Scholars Journal, 5(1): 1–31. [Google Scholar]
  12. Dittrich, D.A.V., Güth, W. and Maciejovsky, B. (2005). Overconfidence in investment decisions: An experimental approach. The European Journal of Finance, 11(6): 471–491, http://dx.doi.org/10.1080/1351847042000255643 [Google Scholar]
  13. Gayle, A.C. and Martinez, A. (2008). The Influence of Government Policy and NGOs on Capturing Private Investment. OECD Global Forum on International Investment, 27–28 March. [Google Scholar]
  14. Gillingham, K. and Sweeney, J. (2010). Market Failure and the Structure of Externalities. In: A.J. Padilla and R. Schmalensee (eds.), Harnessing Renewable Energy: RFF Press. [Google Scholar]
  15. Iyengar, S.S. and Kamenica, E. (2010). Choice proliferation, simplicity seeking, and asset Allocation. Journal Public Economics, 94: 530–539, http://dx.doi.org/10.1016/j.jpubeco. 2010.03.006 [Google Scholar]
  16. James, S. (2009). Incentives and Investments: Evidence and Policy Implications. Investment Climate Advisory Services of the World Bank Group. [Google Scholar]
  17. Kahneman, D. and Tversky, A. (1979). Prospect Theory: An Analysis of Decision under Risk. Econometrica, 47(2): 263–292, http://dx.doi.org/10.1017/CBO9780511609220.014 [Google Scholar]
  18. Kent, D., Hirshleiferc, D. and Siew Hong, T. (2002). Investor psychology in capital markets: evidence and policy implications. Journal of Monetary Economics, 49: 139–209, http://dx.doi.org/10.1016/S0304-3932(01)00091-5 [Google Scholar]
  19. Medda, F. (2007). A game theory approach for the allocation of risks in transport public private partnerships. International Journal of Project Management, 25(3): 213–218,http://dx.doi.org/10.1016/j.ijproman.2006.06.003 [Google Scholar]
  20. Meer K. van der and Noordam, M. (2004). The Use of Grants to Address Market Failures. A Review of World Bank Rural Development Projects. Agriculture and Rural Development Discussion Paper, 27: The World Bank. [Google Scholar]
  21. Miguel, V. de, Garlappi, L. and Uppal, R. (2009). Optimal versus Naive Diversification: How [Google Scholar]
  22. Inefficient Is the 1/N Portfolio Strategy? The Review of Financial Studies, 22(5): 1915–1953, http://dx. doi.org/10.1093/rfs/hhm075 [Google Scholar]
  23. OECD (2007). Tax Effects on Foreign Direct Investment. Recent Evidence and Policy Analysis, http://dx.doi.org/10.1787/9789264038387-en [Google Scholar]
  24. OECD (2008). Tax Effects on Foreign Direct Investment. Policy Brief. OECD Observer. [Google Scholar]
  25. Parys, S. van, James, S. (2010). The effectiveness of tax incentives in attracting investment: panel data evidence from the CFA Franc zone. Int. Tax Public Finance, 17: 400–429, http://dx.doi.org/ 10.1007/s10797-010-9140-1 [Google Scholar]
  26. Pflug, G.Ch., Pichler, A. and Wozabal, D. (2012). The 1/N investment strategy is optimal under high model ambiguity. Journal of Banking & Finance, 36(2): 410–417,http://dx.doi.org/10.1016/j.jbankfin.2011.07.018 [Google Scholar]
  27. Tapia, W. and Yermo, J. (2007). Implications of Behavioural Economics for Mandatory Individual Account Pension Systems. OECD Working Papers on Insurance and Private Pensions, 11: OECD Publishing, http://dx.doi.org/10.1787/103002825851 [Google Scholar]
  28. Tirole, J. (2006). Theory of Corporate Finance. N.J.: Princeton University Press. [Google Scholar]
  29. Tirole, J. (2012). Overcoming Adverse Selection: How Public Intervention Can Restore Market Functioning. American Economic Review, 102(1): 29–59, http://dx.doi.org/10.1257/aer.102.1.29 [Google Scholar]
  30. UNCTAD (2012). Investment law reform a Handbook for development practitioners. Investment climate advisory services of the World Bank Group June 2010: Investment Policy Framework for Sustainable Development UNCTAD. [Google Scholar]
  31. Vivoda, V. (2011). Bargaining Model for the International Oil Industry. Business and Politics, 13(4): 1–34, http://dx.doi.org/10.2202/1469-3569.1384 [Google Scholar]
  32. Žilinskė, A. (2010). Negative and Positive Effects of Foreign Direct Investment. Economics and Management, 15: 332–336. [Google Scholar]

Kompletne metadane

Cytowanie zasobu

APA style

Sokolovskyi, Dmytro, B. & Sokolovska, Olena , V. (2015). Sokolovskyi, D. , B. , & Sokolovska, O. , V. . (2015). Analysis of Ineffectiveness Arising in “Investor-government” Relations. Central European Management Journal, 23(3), 47-70. https://doi.org/10.7206/mba.ce.2084-3356.150 (Original work published 2015)

MLA style

Sokolovskyi, Dmytro, B. and Sokolovska, Olena , V.. Sokolovskyi, D. , B. , i O. , V. Sokolovska. „Analysis Of Ineffectiveness Arising In “Investor-Government” Relations”. 2015. Central European Management Journal, t. 23, nr 3, 2015, ss. 47-70.

Chicago style

Sokolovskyi, Dmytro, B. and Sokolovska, Olena , V.. Sokolovskyi, Dmytro, B. , i Olena , V. Sokolovska. „Analysis Of Ineffectiveness Arising In “Investor-Government” Relations”. Central European Management Journal, Central European Management Journal, 23, nr 3 (2015): 47-70. doi:10.7206/mba.ce.2084-3356.150.

Prawa autorskie

copyright info

CC-BY-NC-ND

Podobne artykuły: