Gennadi Kazakevitch

Gradualism Versus Shock Therapy: (Re)Interpreting the Chinese and Russian Experiences

The concepts of gradualism and shock therapy are reconsidered in respect of the Chinese and Russian experiences. It is suggested that success in reform is determined not only by sharp and speedy measures for attaining macroeconomic financial stabilization, but also, more importantly, how rapidly a critical mass of genuine market forces and competition can be achieved in the microeconomic sphere. In contrast to the orthodox interpretation, it is concluded that the ‘weighted combination’ of macroeconomic and microeconomic reforms in China can be regarded as true ‘shock therapy’, which has brought the Chinese reforms to a successful outcome. In contrast, despite initial macro-financial shock, the Russian reforms have been slow and inconsistent and, for that reason, less successful than in China.

Consumer choice, information product quality, and market implications

The paper concerns with the peculiarities of consumer choice in information product markets. This is a multidisciplinary study based on both information system research and microeconomic theory. An extension is introduced to the conventional general theory of consumer choice for explicitly taking into account the impact of information product quality on consumer behaviour. Multiple quality characteristics, considered against the price of product, are an essential reason for consumer choice of high tech product in general and information product in particular. We assume that consumers are able to aggregate their preferences of multiple product characteristics into a product preference order. On the supply side, the product quality characteristics incur costs. In the case of information product, those costs are the costs of the first copy, and marginal costs are near zero. All of the above constitute the distinctive characteristics of the competitive mechanism in the digital economy and in information product markets. A model, based on the game theory is used to consider two special cases. The first one deals with monopolistic competition for a share of the market with a limited number of customers. Conditions are derived for IT firm survival. The second one considers conditions at which a monopoly is able to successfully introduce a new version if its information product.

How long do households remain in housing affordability stress

Abstract We develop a model that specifies the duration of housing affordability stress for particular types of households. Using panel data from Australia, households are considered in semi- and parametric analysis against different household characteristics, revealing whether these characteristics predict the duration of housing affordability stress. For most types of households, an experience of housing affordability stress lasts less than one year. A group of household types disproportionately made up of renters and sole persons remains in stress for longer periods. Chronic housing affordability stress occurs if the duration of stress lasts for more than three years. Linking the duration of stress to household types, and demographic, financial and educational characteristics makes it possible to design more targeted, and therefore more efficient housing affordability policies.

Global financial crisis and international division of labour

While the most optimistic economists and media commentators are rushing to declare that the worst of the world economic crisis is over, those declarations not only may be premature but also overshadow the fundamental reasons and possible lasting consequences of the current global downturn. In contrast to the prevailing line of arguments of the current orthodoxy on the reasons for the crises, this paper provides an explanation for the current crisis in simple real, rather than financial market, terms. First, we show theoretically the relationship between financial bubbles with both consumption and deindustrialization. Then, by estimating models, based on cross-country panel data, we derive a worldwide trend linking industrialisation to an improving balance of payments and foreign debt position, while, deindustrialisation is found to be correlated with balance of payments deficit and foreign debt. This might be an indication that post-industrial economic development, as it has been evolving so far, is “no-through road”, for Western nations, reducing opportunities for employment and ultimately leading to decreases in standard of living.

Why don't you give me a call?

In a mature mobile phone market, dollars still drive consumers’ decisions, write Gennadi Kazakevitch, Luba Torlina and Sharon Hendricks.