Table of contents: Appendix

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Table 1: VIF analysis Added Value FIRE sector ... - 2 -

Table 2: Correlation between Total Value of Traded Stocks and Market Capitalization (added

value FIRE sector)... - 2 -

Table 3: VIF Value Added FIRE sector after removal Market Capitalization... - 2 -

Table 4: VIF analysis Manufacturing Wages... - 3 -

Table 5: Correlation between Total Value of Traded Stocks and Market Capitalization

(manufacturing wages)... - 3 -

Table 6: VIF analysis Manufacturing Wages after removal Market Capitalization... - 3 -

Table 7: VIF analysis Unemployment Ratio... - 4 -

Table 8: Correlation between Total Value of Traded Stocks and Market Capitalization

(Unemployment Ratio)... - 4 -

Table 9: VIF analysis Unemployment Ratio after removal Market Capitalization... - 4 -

Table 10: Durbin-Watson autocorrelation test Value Added FIRE-sector... - 5 -

Output 1: Regression Value Added FIRE-sector with autocorrelation (2 years lag) ... - 5 -

Output 2: Regression Value Added FIRE-sector with autocorrelation and fixed country effects

(2 years lag)... - 7 -

Output 3: Regression Value Added FIRE-sector without autocorrelation and fixed period effects

(2 years lag)... - 8 -

Table 11: Durbin-Watson autocorrelation test Manufacturing Wages... - 8 -

Output 4: Regression Manufacturing Wages with autocorrelation, no fixed effects (2 year lag) . -

10 -

Output 5: Regression Manufacturing Wages with autocorrelation, fixed country effects (2 year

lag)... - 11 -

Output 6: Regression Manufacturing Wages, no autocorrelation, fixed period effects (2 year

lag)... - 12 -

Table 12: Durbin-Watson autocorrelation test Unemployment Ratio... - 12 -

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Table 1: VIF analysis Added Value FIRE sector

Model Collinearity Statistics

Tolerance VIF

(Constant)

Market liberalization ,390 2,564

Standard deviation of

exchange rate ,641 1,561

Total banking Claims

on the economy ,674 1,483

Total value of traded

stocks ,123 8,159 Lending Rates ,569 1,757 Privatization ,483 2,070 Market capitalization ,130 7,703 Renting Price of appartment ,340 2,945 Asset share of Foreign Banks ,621 1,611

a Dependent Variable: Value added of FIRE-sector

Table 2: Correlation between Total Value of Traded Stocks and Market

Capitalization (added value FIRE sector)

Total value of traded stocks capitalization Market

Pearson Correlation 1 ,879(**)

Sig. (2-tailed) _,000

Total value of traded stocks N 61 61 Pearson Correlation _,879(**) ₁ Sig. (2-tailed) ,000 Market capitalization N ₆₁ ₆₁

** Correlation is significant at the 0.01 level (2-tailed).

Table 3: VIF Value Added FIRE sector after removal Market Capitalization

Model _{Collinearity Statistics}

(Constant)

stocks ,363 2,758 Lending Rates ,616 1,623 Privatization ,506 1,977 Renting Price of appartment ,340 2,945 Asset share of Foreign Banks ,699 1,431

(3)

Table 4: VIF analysis Manufacturing Wages

(Constant)

stocks ,099 10,114 Lending Rates ,511 1,955 Privatization ,438 2,285 Market capitalization ,137 7,286 Renting Price of appartment ,218 4,583 Asset share of Foreign Banks ,512 1,954

a Dependent Variable: Manufacturing wages

Table 5: Correlation between Total Value of Traded Stocks and Market

Capitalization (manufacturing wages)

Total value of traded stocks N ₄₈ ₄₈ Pearson Correlation ,843(**) 1 Sig. (2-tailed) _,000 Market capitalization N ₄₈ ₄₈

Table 6: VIF analysis Manufacturing Wages after removal Market Capitalization

(Constant)

stocks ,298 3,361 Lending Rates ,550 1,819 Privatization ,442 2,263 Asset share of Foreign Banks ,544 1,838 Renting Price of appartment ,249 4,017

(4)

Table 7: VIF analysis Unemployment Ratio

(Constant)

Total banking Claims on

the economy ,648 1,543

stocks ,117 8,516

Lending Rates ,579 1,728

Asset share of Foreign

Banks ,594 1,683

Renting Price of

appartment ,350 2,858

Market capitalization ,128 7,784

Privatization ,462 2,166

a Dependent Variable: Unemployment rate

Table 8: Correlation between Total Value of Traded Stocks and Market

Capitalization (Unemployment Ratio)

Total value of traded stocks N 63 63 Pearson Correlation _,888(**) ₁ Sig. (2-tailed) ,000 Market capitalization N ₆₃ ₆₃

Table 9: VIF analysis Unemployment Ratio after removal Market Capitalization

Tolerance VIF 1 (Constant) Market liberalization ,508 1,970 Standard deviation of exchange rate ,672 1,488 Total banking Claims on the economy ,649 1,541 Total value of traded stocks ,345 2,897 Lending Rates ,627 1,595 Privatization _,478 _2,094 Renting Price of appartment ,350 2,856 Asset share of Foreign Banks ,644 1,553

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Table 10: Durbin-Watson autocorrelation test Value Added FIRE-sector

Durbin-Watson Statistic Lower Critical Value Upper Critical Value Autocorrelation? For positive autocorrelati on 2.476 1.441 1.647 No For negative autocorrelati on 1.524 1.441 1.647 Inconclusive

Critical values for N=100+ (1% significance)

Output 1: Regression Value Added FIRE-sector with autocorrelation (2 years lag)

Dependent Variable: VALUE_ADDED_OF_FIRE_SECT Method: Panel Least Squares

Date: 08/06/07 Time: 13:49 Sample: 1 107

Cross-sections included: 16

Total panel (unbalanced) observations: 91

White period standard errors & covariance (d.f. corrected) Convergence not achieved after 500 iterations

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Output 2: Regression Value Added FIRE-sector with autocorrelation and fixed

country effects (2 years lag)

Date: 08/06/07 Time: 13:53 Sample: 1 107

White period standard errors & covariance (d.f. corrected)

Variable Coefficient Std. Error t-Statistic Prob. TOTAL_VALUE_OF_TRADED_ST -0.092749 0.033352 -2.780960 0.0067 TOTAL_BANKING_CLAIMS_ON_ 0.014456 0.027375 0.528063 0.5988 STANDARD_DEVIATION_OF_EX 0.111500 0.031981 3.486496 0.0008 PRIVATIZATION 0.003030 0.027555 0.109976 0.9127 MARKET_LIBERALIZATION -0.058689 0.047075 -1.246710 0.2159 LENDING_RATES -0.102347 0.042617 -2.401532 0.0185 C 1.049256 0.126843 8.272071 0.0000 Effects Specification Cross-section fixed (dummy variables)

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Output 3: Regression Value Added FIRE-sector without autocorrelation and fixed

period effects (2 years lag)

Date: 08/06/07 Time: 13:53 Sample: 1 107

Variable Coefficient Std. Error t-Statistic Prob. TOTAL_VALUE_OF_TRADED_ST -0.123616 0.037261 -3.317540 0.0013 TOTAL_BANKING_CLAIMS_ON_ -0.065783 0.029363 -2.240313 0.0275 STANDARD_DEVIATION_OF_EX 0.118400 0.035748 3.312085 0.0013 PRIVATIZATION 0.033445 0.014289 2.340707 0.0214 MARKET_LIBERALIZATION -0.042823 0.040183 -1.065689 0.2894 LENDING_RATES -0.035322 0.043835 -0.805790 0.4225 C 1.256389 0.169928 7.393662 0.0000 Effects Specification Period fixed (dummy variables)

R-squared 0.414310 Mean dependent var 0.943746 Adjusted R-squared 0.317768 S.D. dependent var 0.193555 S.E. of regression 0.159872 Akaike info criterion -0.691796 Sum squared resid 2.325861 Schwarz criterion -0.292121 Log likelihood 53.01109 F-statistic 4.291485 Durbin-Watson stat 2.380898 Prob(F-statistic) 0.000006

Table 11: Durbin-Watson autocorrelation test Manufacturing Wages

Durbin-Watson

Statistic

Lower

Value

Upper

Value

Autocorrelation?

For positive

autocorrelat

ion

1.649

1.283

1.604 No

For

negative

autocorrelat

ion

2.351

1.283

1.604 No

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Output 4: Regression Manufacturing Wages with autocorrelation, no fixed effects

(2 year lag)

Dependent Variable: MANUFACTURING_WAGES Method: Panel Least Squares

Date: 08/06/07 Time: 14:02 Sample: 1 64

White period standard errors & covariance (d.f. corrected) Convergence achieved after 9 iterations

(11)

Output 5: Regression Manufacturing Wages with autocorrelation, fixed country

effects (2 year lag)

Date: 08/06/07 Time: 14:03 Sample: 1 64

White period standard errors & covariance (d.f. corrected) Convergence not achieved after 500 iterations

Variable Coefficient Std. Error t-Statistic Prob. LENDING_RATES -0.055378 0.023854 -2.321605 0.0270 MARKET_LIBERALIZATION -0.036031 0.016417 -2.194651 0.0358 PRIVATIZATION -0.013729 0.007824 -1.754791 0.0892 STANDARD_DEVIATION_OF_EX -0.028950 0.041355 -0.700036 0.4891 TOTAL_BANKING_CLAIMS_ON_ 0.014976 0.014879 1.006546 0.3219 TOTAL_VALUE_OF_TRADED_ST -0.047738 0.014489 -3.294829 0.0025 C 2.066789 0.060423 34.20547 0.0000 AR(1) -0.267921 0.153294 -1.747760 0.0904 Effects Specification Cross-section fixed (dummy variables)

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Output 6: Regression Manufacturing Wages, no autocorrelation, fixed period

effects (2 year lag)

Date: 08/06/07 Time: 14:05 Sample: 1 64

Variable Coefficient Std. Error t-Statistic Prob. LENDING_RATES -0.064180 0.029438 -2.180171 0.0341 MARKET_LIBERALIZATION -0.038341 0.024932 -1.537812 0.1305 PRIVATIZATION -0.007712 0.006487 -1.188852 0.2402 STANDARD_DEVIATION_OF_EX 0.017864 0.030153 0.592454 0.5563 TOTAL_BANKING_CLAIMS_ON_ 6.67E-05 0.018713 0.003563 0.9972 TOTAL_VALUE_OF_TRADED_ST -0.042400 0.013899 -3.050616 0.0037 C 2.141178 0.081667 26.21826 0.0000 Effects Specification Period fixed (dummy variables)

R-squared 0.429834 Mean dependent var 2.010321 Adjusted R-squared 0.266929 S.D. dependent var 0.072148 S.E. of regression 0.061772 Akaike info criterion -2.529033 Sum squared resid 0.186976 Schwarz criterion -2.023045 Log likelihood 95.92905 F-statistic 2.638562 Durbin-Watson stat 1.676284 Prob(F-statistic) 0.006181

Table 12: Durbin-Watson autocorrelation test Unemployment Ratio

Durbin-Watson Statistic

Lower Value Upper Value Autocorrelation?

For positive autocorrelati on 2.190 1.441 1.647 No For negative autocorrelati on 1.817 1.441 1.647 No

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Output 7: Regression Unemployment Ratio, no autocorrelation, period fixed

effects (1 year lag)

Dependent Variable: UNEMPLOYMENT_RATE Method: Panel Least Squares

Date: 08/06/07 Time: 14:15 Sample: 1 108

White diagonal standard errors & covariance (d.f. corrected)

Variable Coefficient Std. Error t-Statistic Prob. TOTAL_VALUE_OF_TRADED_ST -0.045393 0.033216 -1.366579 0.1751 TOTAL_BANKING_CLAIMS_ON_ 0.015913 0.033745 0.471548 0.6384 STANDARD_DEVIATION_OF_EX -0.132388 0.035238 -3.756981 0.0003 MARKET_LIBERALIZATION -0.018643 0.046909 -0.397432 0.6920 PRIVATIZATION -0.002161 0.018648 -0.115871 0.9080 LENDING_RATES 0.025313 0.061761 0.409851 0.6829 C 0.829177 0.151197 5.484087 0.0000 Effects Specification Period fixed (dummy variables)

(14)

Output 8: Regression Unemployment Ratio, autocorrelation, country fixed effects

(1 year lag)

Dependent Variable: UNEMPLOYMENT_RATE Method: Panel Least Squares

Date: 08/06/07 Time: 14:17 Sample: 1 108

White period standard errors & covariance (d.f. corrected) Convergence achieved after 15 iterations

Variable Coefficient Std. Error t-Statistic Prob. TOTAL_VALUE_OF_TRADED_ST -0.045960 0.028947 -1.587748 0.1169 TOTAL_BANKING_CLAIMS_ON_ -0.230812 0.033376 -6.915403 0.0000 STANDARD_DEVIATION_OF_EX 0.119248 0.052484 2.272064 0.0262 MARKET_LIBERALIZATION -0.256112 0.046299 -5.531691 0.0000 PRIVATIZATION 0.027133 0.020368 1.332107 0.1872 LENDING_RATES 0.549879 0.159328 3.451247 0.0010 C 1.116341 0.178026 6.270657 0.0000 AR(1) -0.268376 0.048551 -5.527743 0.0000 Effects Specification Cross-section fixed (dummy variables)