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Abstract:
This paper uses data on 27,000 firms from 50 countries, half of which are transition economies, together with the specific case of Serbia to examine the relationship between productivity, the investment climate and private ownership of firms. As government capacity to address the investment climate constraints is limited, the prioritization of the constraints is critical. Identification of the relative effects of various investment climate constraints and ownership on productivity should serve as a guide for such prioritization. Although ownership has recently received less attention in policy decisions than previously, according to the econometric analysis of productivity reported in the paper, private ownership is an equally or more important determinant of productivity than other components of the investment climate. The importance of ownership shows that an unfinished privatization and restructuring agenda might have negative effects on productivity, in parallel to poor investment climate. Another important finding is that countries in which firms complain more about infrastructure tend to have less productive firms.

Abstract:
The knowledge based restructuring is taking into account the fact that after the inclusion of new entrants, ICT based changes are not solely related to the concept of the strategic restructuring of already existing companies. Using the BEEPS 2 data, we find that new firms and exporters are driving the innovation process in the transition economies and that both the availability of ICT and the existence of competitive pressure raise innovation. In addition, favourable business environment is an important positive determinant of the decision to innovate. Business environment indirectly, through strategic restructuring affects sales growth as strategic restructuring represents positive and significant determinant of the performance ICT both directly and indirectly affects performance equation. Subsidies are weakly positively related to knowledge based restructuring. The question of subsidies needs to be more analysed. It is unclear whether subsidies are now becoming more related to the strategic restructuring through a governmental support to certain industrial sectors, or subsidies are linked to defensive restructuring, as a support to deal with redundancies.

Restructuring, Business Environment, Competition, ICT

Abstract:
This paper empirically examines the determinants of bankruptcy resolution choce decision i.e. choice between section 363 (preplan) sales and traditional reorganization; the determinants of the availability and size of debtor-in-possession financing; and the effects of resolution choice on recovery rates. We find that business justification standard for not going though the traditional Chapter 11 process of disclosure and plan confirmation is not randomly applied - one can rather accurately classify companies according to their resolution choice. The resolution choice doesn't influence on the availability or on the magnitude of DIP financing. Predominant factor explaining difference in recovery rates relates to profitability prior to bankruptcy rather than to resolution choice itself. We find that section 363 sales are somewhere between "statistically significantly but not greatly worse" and "considerably but not statistically significantly worse". After controlling for self-selection (which is significant and effective), traditional reorganization does seem to offer higher recovery rates comparable to preplan sale, but results are neither statistically robust, nor as important as it is argued in LoPucki and Doherty (2007). Availability of DIP financing doesn't significantly affect recovery rates unless its size is considerable. The increase in relative size of DIP financing makes everyone better-off. Although results suggest that there is no systemic error with respect to companies that opt for preplan sales there are certainly several important procedural issues that could be improved while keeping the flexibility of section 363(b).

Chapter 11, DIP financing, resolution choice, self-selection bias, section 363

Abstract:
The paper builds upon existing models on the evolution of the common law. I consider a model of legal evolution in which judges have varying ideologies and propensities to extend the domain of legal remedies and causes of action and parties could have symmetric or asymmetric stakes. The model integrates the models of legal evolution with endogenous litigation costs and endogenous probability of prevailing. The paper advances the short-run evolutionary analysis and suggests the convergence of legal standards but with the constant "battle for precedents" around closely contested cases. In the long-run however we should search for other explanations, like the change of the judges' ideology reflecting a change of societal preferences.

legal evolution, precedents, endogenous litigation costs