William Davidson Institute Working Paper 487
Chart 1. Model of Inflation - dynamic BS affect

The stance of pre-accession economies is characterized by a number of features,
which cause many problems not only in the BS effect estimation but in its clear detection
as well. Various factors have different impact on the BS effect, making it either stronger
or weaker. Let’s point out some of them19.
First of all, the time of centrally planned economy is distinguished for the
repression and low productivity in the services sector. The labor in the sector was not
regarded as productive one20 and it was not included in the produced national income
(concept used in the socialist accounting instead of GDP). As a consequence of the
recovering of the sector during the transition, high productivity rates are evident while
the BS effect implies that productivity of the services sector does not exceed the
productivity of industries (Busson and Villa, 1996). As a whole, this transition specificity
reflects into a weaker BS effect.
19 See for example Aglietta and al. (1998), Frensch (2001), Cheung and Lai, (2000), Brada and
Kutan (2001).
20 The definitions of productive and non-productive labor were typical for the centrally planned
economy and used in Marxist terminology.
11
More intriguing information
1. Indirect Effects of Pesticide Regulation and the Food Quality Protection Act2. Apprenticeships in the UK: from the industrial-relation via market-led and social inclusion models
3. The name is absent
4. Foreword: Special Issue on Invasive Species
5. Update to a program for saving a model fit as a dataset
6. Non Linear Contracting and Endogenous Buyer Power between Manufacturers and Retailers: Empirical Evidence on Food Retailing in France
7. Direct observations of the kinetics of migrating T-cells suggest active retention by endothelial cells with continual bidirectional migration
8. Wage mobility, Job mobility and Spatial mobility in the Portuguese economy
9. WP 36 - Women's Preferences or Delineated Policies? The development or part-time work in the Netherlands, Germany and the United Kingdom
10. The effect of classroom diversity on tolerance and participation in England, Sweden and Germany