Five papers make up this issue. The first one, titled Anti-Money Laundering Regulation and Crime: A Two-Period Model of Money-in-the-Utility-Function by Fassil Fanta and Hasan M Mohsin, presents a two-period model of money-in-the-utility-function to investigate the impact of anti-money laundering policy on crime. Their two- period model reveals that an increase in labor wage in the legal sector unambiguously decrease labor hours allocated for illegal sector. However, the crime-reducing impact of anti-money laundry regulation and the probability of the agent to be caught require both parameters should be above some thresholds. These thresholds are a function of the marginal rate of substitution of ‘dirty’ money for consumption and the responsiveness (elasticity) of illegal income to the policy parameter. Higher threshold implies the need for stringent anti-money laundering policy. Therefore, the marginal rate of substitution between ‘dirty’ money and consumption, and the elasticity of illegal income to the policy parameter are the key in governing the formulation of the anti-money laundry policy.

The second paper, titled Determinants of Trade Flows among D8 Countries: Evidence from the Gravity Model by Yaghoob Jafari, Mohd Adib Ismail and Morteza Sadegh Kouhestani, identifies the factors affecting export flows among the D8 countries. The results from a gravity model, which is estimated using Panel Correlated Standard Errors (PCSE), demonstrate that the trading partners’ Gross Domestic Product (GDP), exchange rate, population of exporter country, border and distance are the notable factors affecting the volume of export flow among the countries in the D8 group. In line with the results, the countries would do better if they focus on exporting more to their neighbouring countries within the group and also undertake the measures which ensure low transportation costs. Additionally, the currency depreciation would increase the trade flows among the members when other adverse effects are taking into account.

The third paper, titled Determinants of OIC Countries’ Custom Revenue vis-à-vis Implementation of WTO Customs Valuation Agreement by Ahmet Suayb Gundogdu, scrutinizes the determinants of customs revenue in the context of WTO member OIC countries. An econometric model of OLS, fixed effect and random effect calculations is employed with panel data of 1995-2007. The results suggest that increasing tariffs might increase customs revenue for big countries but not for small countries. Besides, the implementation of WTO Customs Valuation Agreement does not decrease customs revenue as its indirect undervaluation effect would be surpassed by its direct effect of less incentive for tax evasion. He suggests implementing information and communications technologies in the form of integrated single windows to tackle undervaluation issue as an alternative to Preshipment inspection course.

The fourth paper, titled An Alternative Model of Infrastructure Financing Based on Capital Markets: Infrastructure REITS in Turkey by Turan Erol and Deniz D. Ozuturk, explores how Real Estate Investment Trusts (REITs) in Turkey can be used as an equity finance vehicle to launch and operate infrastructure projects. They present an overview on infrastructure assets and funds, their operational framework and risk factors related to infrastructure funds in the second section. In the third section they analyze capital market financing of infrastructure projects in Turkey. In the next section, they provide some information on REITs in Turkey . In the fifth and the last section, they propose that REITs can be an alternative tool for financing urban regeneration projects or regional projects such as Southern Anatolia Project.

The last and fifth paper, titled Is There a Bank Lending Channel in Tunisia ? by Adnen Chokri, aims to investigate the relevance of bank lending channel of monetary policy in Tunisia by using disaggregated bank level data set. To avoid this ambiguity, a panel of annual balance sheet data on 10 Tunisian banks used to test whether lending responses to a change in monetary policy differs, depending on the balance sheet strength of a bank. The empirical evidence has stated that monetary policy shocks is significantly and negatively influenced the banks’ loan supply, and therefore has supported the existence of bank lending channel in Tunisia. In addition, several bank characteristics variables namely capitalization, size and liquidity in the transmission of monetary policy is studied. Size revealed to be an important bank characteristic that affects the way Tunisian banks react to monetary policy changes.

Abstract articles of the Journal of Economic Cooperation and Development, Vol.32 No.3 (2011)