Research Interests: Economic Growth and Development, Political Economy, Institutions, Welfare, Policy Design, Inequalities, Elections, Education, Wellbeing, Prosperity.
Work in Progress
Measuring the Informal Economy in Balkan Countries Using Structural Equation Modelling
We investigate the size and trends of the informal economy (IE) in ten Balkan nations from 1996-2021 using the MIMIC model. Our findings reveal a consistent decline in the IE in our sample, albeit it remains substantial, exceeding 29% (of GDP) in 2021. We also explore the impact of the COVID-19 pandemic on the IE of the region. Our results indicate a significant increase in the IE during this period. Our research emphasises structural characteristics and macroeconomic trends as essential drivers of the IE, allowing us to provide valuable insights into the dynamics of the IE. Our research addresses the measurement gap in the post-reform IE of the region, providing a robust estimation of the IE’s extent. Ultimately, our study provides a solid framework for policymakers and researchers seeking to understand and address IE concerns in the Balkan region and beyond and their implications for economic development.
East London Citizen Prosperity Index Methodology
The Citizen Prosperity Index (CPI), developed by the Institute for Global Prosperity at University College London, offers a novel approach to measuring prosperity beyond traditional economic indicators. This methodology paper outlines the CPI’s application in east London, focusing on 15 Lower Layer Super Output Areas across five boroughs undergoing regeneration projects. The CPI features a communitydriven design, citizen scientist data collection, and a multidimensional framework encompassing five key domains: Foundations of Prosperity, Opportunities and Aspirations, Power, Voice and Influence, Belonging, Connections and Leisure, and Health and Healthy Environments. The paper describes the mixed-methods approach, combining quantitative surveys with qualitative research, and details the index construction process, including data treatment, post-stratification weights, and z-score normalisation techniques. This methodology enables individual, local, borough, and city-wide analysis, providing a nuanced understanding of prosperity across different scales. The CPI’s potential for global application is discussed, highlighting its adaptability to diverse contexts, as demonstrated by its expansion to Lebanon and Tanzania. The paper examines the implications for policy and practice, emphasising the CPI’s value in informing targeted interventions and investment strategies across various sectors. By offering stakeholders a sophisticated tool for understanding and promoting prosperity, the CPI contributes to a broader reconceptualisation of prosperity, aligning measurement practices with community-defined priorities and wellbeing.
The Educational Path to Institutional Quality: A Panel Analysis of Developing Economies
This study examines how education influences the quality of institutions in developing nations. Utilising a comprehensive panel dataset comprising 86 developing nations from 1970 to 2014, a range of econometric methods is applied, such as Fixed Effects, Difference-GMM, System-GMM, and bias-corrected estimators, to tackle potential endogeneity and measurement challenges. The results of this study demonstrate strong evidence that higher levels of education lead to a significant improvement in institutional quality, as measured by the Fraser Institute’s Economic Freedom of the World Index. A one standard deviation increase in education is associated with roughly a 10% improvement in institutional quality. The effect is significant and remains stable across various model specifications, surpassing the impact of other factors such as economic growth and GDP per capita. The findings indicate that education influences various dimensions of institutional quality differently, demonstrating a more pronounced effect on regulatory frameworks than on legal systems. The results of this study add to the current discussion regarding the significance of human capital in comparison to other factors that influence institutions, providing valuable insights for policymakers in developing nations aiming to enhance their institutional quality.
Crime and Unemployment – The Effects of Labour Market Policies and Shadow Economy
We examine the crime-unemployment relationship in 26 EU countries and the possibility of potential asymmetries developing in the presence of labour market policies and/or certain structural characteristics. We find that the, otherwise well-established, relationship is strongly moderated in the presence of a sizeable underground economic activity and when active labour market policies are used to tackle unemployment. To avoid being misled about the effectiveness of crime fighting policy where a strong link between unemployment and crime cannot be found, policymakers should recognise and further take into account the mitigating effects of elevated levels of the shadow economy as well as those of labour market policies.
Education and Institutional Quality: Evidence from EU Regions
This study examines the determinants of institutional quality across European regions, focusing on the roles of education and income. Using a cross-sectional dataset of 192 NUTS 1 and NUTS 2 regions from 28 EU member states, this paper investigates the impact of socioeconomic factors on the Quality of Government (QoG) index and corruption rates. To account for potential endogeneity between education and institutional quality, this study uses secularism-measured by the proportion of non-religious individuals-as an instrument for education in instrumental variable (IV) regression. The empirical findings show that higher education and income levels are significantly associated with higher institutional quality. Specifically, a one percentage point increase in the share of tertiary-educated people corresponds to a 6-point increase in the QoG index. Multiple statistical tests confirm the instruments’ strength and validity, increasing confidence in the causal interpretations of the findings. According to the analysis, poverty is negatively associated with institutional quality, whereas social trust has a positive impact. Interestingly, urbanization and the presence of a country’s capital within a region are associated with lower QoG scores, which may reflect governance challenges in densely populated areas. The study also demonstrates the impact of legal origins on institutional performance, with regions with German and Scandinavian legal traditions outperforming others. These findings highlight the importance of socioeconomic and cultural factors in determining institutional quality. From a policy standpoint, the findings support investments in education as effective strategies for improving governance and reducing corruption in European regions.
A Model of Institutional Change
This paper presents a dynamic model that explains the evolution and transition of political regimes over time, focusing on a dictator government’s optimisation problem. The dictator aims to maximise utility while avoiding regime change, balancing extraction of resources with maintaining regime stability. The model incorporates multiple equilibria and path dependence, demonstrating how initial conditions and policy choices can lead to divergent institutional outcomes. By formalising these relationships and incorporating expanded real-world examples such as Zimbabwe, China, and Venezuela, we provide insights into the conditions under which regime transitions occur, when dictators may maintain control, and how economic factors contribute to institutional evolution.
- Culture, Institutions and policy effectiveness on the COVID-19 Pandemic
- Determinants of trust and corruption (experimental approach)
- African Leaders and Ethnic Violence
PhD Thesis: “Essays on the Quality of Institutions and Economic Performance”
This thesis builds a model to describe the process of institutional change in which the probability of revolution depends on the state of the economy and the level of education in the society. The model generates two cases. First, institutional change will occur when the cost of revolution is lower than the cost of the recession. The magnitude of the negative shock, sufficient to cause a revolution, depends on education; the higher the level of education in the society the lower the magnitude of the negative shock. The second case, when the cost of a revolution is higher than the cost of a negative shock, generates a mechanism of marginal institutional changes. Those who hold the power can adjust the quality of institutions to avoid a revolution; the magnitude of the changes necessary to prevent a revolution depends positively on both the magnitude of the shock and the level of education in the society. Both cases predict that institutional improvement is associated with increasing levels of education. We then test the prediction of our model. First, in a dynamic panel analysis of 86 developing countries, the system GMM results demonstrate that the quality of institutions will increase by 10% if years of schooling increase by one standard deviation. This result is confirmed by two separate bias correction estimations (BCFE and LSDV). Second, we use an EU cross-regional dataset of the Quality of Government to examine the determinants of institutional quality in European regions. Using the share of atheists in every region as an instrument for education, our IV estimations confirm the prediction of our model. More education leads to better institutions. Additionally, our findings confirm other existing theories of the political and social determinants of the quality of institutions and demonstrate that this phenomenon is not confined to developing countries or even post-communist economies
- Barriers to learning online for international undergraduate students
The global pandemic in 2020 plunged Coventry University London into delivering learning online overnight. With little preparation time, the final weeks of the semester were transformed from in-class to online. The move online presented many opportunities and barriers for international undergraduate learners. This presentation will highlight some challenges faced by staff and students and the synchronous and asynchronous strategies used to overcome them. Key challenges include motivation, anxiety, well-being, online etiquette, and peer interaction. Experiences will be shared from the perspectives of International Fashion Management and Marketing and International Accounting and Finance undergraduate Course Directors.
Nikos Tzivanakis 