Firms, Kinship and Economic Growth in the Kyrgyz Republic

Abstract : This paper addresses whether kinship networks promote or impede entrepreneurship in the Central Asian Republic of Kyrgyzstan. We conducted a survey of firm managers/entrepreneurs about their business networks, resources they receive from and provide to their contacts, their firm’s performance, and the business environment they face. Our data indicate that receiving help from kin connections increases profitability, while providing help to kin decreases it. While kin-reliant firms grow slower than firms with a lower degree of kin assistance, the former grow faster than firms that do not have access to business networks. In addition, kin connections and firm performance are unrelated for firms that have adopted best business practices. Our results demonstrate that directly measuring both receipt and provision of help from/to kin helps resolve the ambiguity of findings in the broader literature regarding the net effects of kin networks on firm performance: the two forms of network use are positively correlated, yet have opposite effects.

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Free and Protected: Trade and Breaks in Long-term Persistence

Abstract : The spatial distribution of economic activity depends largely on market access and history, but countries differ greatly in the extent to which their geographies reflect these two determinants. What explains these differences? This paper explores this question using a staggered lifting of restrictions on direct trade with Europe across the Spanish Empire. I combine a difference-in-differences approach with a dynamic spatial equilibrium framework and detailed georeferenced data on maritime travel from historical logbooks to examine this issue. I show that the increase in market access induced by the reform led to a substantial reconfiguration of the economic geography in places that were initially less densely settled. Moreover, I show that modern-day settlement patterns depend less on pre-colonial population density and more on coastal access in areas subjected to the reform. Taken together, the findings show that a key determinant of persistence in economic geography is the level of development of a country as it opens up to trade.

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Technology Transfer and Early Industrial Development: Evidence from the Sino-soviet Alliance

Abstract : This paper studies the causal effect of technology transfer on early industrial development. Between 1950 and 1957, the Soviet Union supported the “156 Projects” in China for the construction of technologically advanced, large-scale, capital-intensive industrial facilities. We exploit idiosyncratic delays in project completion, due to which some projects received Soviet technology and know-how, while some others were eventually realized by China alone using domestic technology. We find that the Soviet technology had large and persistent effects on plant performance, and know-how diffusion by Soviet experts further boosted firm outcomes. The intervention generated horizontal and vertical spillovers and production reallocation from state-owned to privately-owned companies since the late 1990s.

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