|
on South East Asia |
| By: | Guillaume Gaulier; Francoise Lemoine; Deniz Unal-Kesenci |
| Abstract: | The emergence of China has intensified the international segmentation of production processes within Asia, but has not created an autonomous engine for the region’s trade, as Asia still depends on outside markets for its final goods exports. The reorganisation of production has weakened the position of the advanced economies (Japan and the US) in Asia’s trade, but up to now has not severely affected the position of the emerging Asian economies (Malaysia, Philippines, Thailand). However, the surge of China’s exports and the decline of its export prices, suggest the risk of a downward spiral of cost-competition, while the deterioration of China’s terms of trade raises the question of the sustainability of its recent growth strategy. |
| Keywords: | China; Asia; trade; regional integration; specialisation |
| JEL: | F14 F15 F2 |
| Date: | 2006–03 |
| URL: | http://d.repec.org/n?u=RePEc:cii:cepidt:2006-05&r=sea |
| By: | Takashi Terada (Australia-Japan Research Centre) |
| Abstract: | This paper aims to examine the implications of the rise of East Asian regionalism for the Australia–Japan partnership. In particular, it investigates whether both nations can sustain their partnership, which evolved around Asia Pacific regionalism over the last few decades, by exploring the upsurge of Japan’s interest in East Asian regionalism and examining characteristics of Australia’s foreign policy under the Howard government, which lacked a regionalist approach in its first three terms but has shown a keener interest in furthering relations with East Asian countries and promoting East Asian regionalism since late 2004. |
| Keywords: | Australia–Japan partnership, Asia Pacific regionalism, regionalist approach, Howard, development, APEC, |
| JEL: | O11 O19 F15 |
| Date: | 2006–12 |
| URL: | http://d.repec.org/n?u=RePEc:eab:develo:668&r=sea |
| By: | Justin Yifu Lin (China Center for Economic Research, Peking University) |
| Abstract: | In this paper I will breifly review the economic performance of China's economic reform starting in 1978, followed by my personal views on the experiences of Korea's economic development and lessons for China's economic reform. In the third section I will explore the prospect of China's future development. I will then review the China-Korea economic relationship since the establishment of diplomatic relations and discuss its future propect. Finally, I would like to share with you my personal feelings for the centennial anniversary of Korea University and the friendship between our two nations. |
| Keywords: | China, Korea, development, economic reform, |
| JEL: | O11 O53 O19 |
| Date: | 2005–07 |
| URL: | http://d.repec.org/n?u=RePEc:eab:develo:655&r=sea |
| By: | Takashi Terada (National University of Singapore) |
| Abstract: | This paper aims to examine how and why Japan and Singapore decided to pursue FTAs, what interests both perceived in their pursuit of FTAs, what elements contributed to both countries being linked in this trade policy arrangement, and what implications the JSEPA has had for the FTA movement in East Asia. It argues that the JSEPA was made possible mainly through Singapore’s initial offer to exclude agricultural products from tariff elimination. But Japan faced problems in seeking FTAs with other ASEAN countries which were less developed than Singapore and had a higher proportion of agricultural exports, as the exclusion of specific agricultural products, such as rice and sugar, would contradict Japan’s claim that its FTAs would bolster the WTO-based multilateral system. The proliferation of FTAs in East Asia may generate a ‘spaghetti-bowl’ effect with varying rules of origin that may divert and distort trade, but the ‘new age’ aspects of the Japan-Singapore agreement will also have some positive economic effects. Although the preferential trade elements of the agreement are detrimental, the smaller portion of tariff elimination results in a smaller trade diversion effect on trading partners. Therefore, the Japan-Singapore agreement carries symbolic meaning in terms of trade policy debates as well as signifying a paradigm shift in Japan’s international trade policy. |
| Keywords: | Japan, Singapore, international trade, FTA, East Asia, JSEPA, tariff elimination, preferencial trade agreement |
| JEL: | F16 F42 O24 |
| Date: | 2006–03 |
| URL: | http://d.repec.org/n?u=RePEc:eab:tradew:693&r=sea |
| By: | John C. Beghin (Center for Agricultural and Rural Development (CARD); Food and Agricultural Policy Research Institute (FAPRI)) |
| Abstract: | This paper is an overview of important findings regarding the ongoing evolution of Asian dairy markets based on a series of new economic investigations. These investigations provide systematic empirical foundations for assessing Asian dairy markets with their new consumption patterns, changing industries, and trade prospects under different domestic and trade policy regimes. The findings are drawn from four case studies (China, India, Japan, and Korea), as well as a prospective analysis of future regional patterns of consumption and a policy analysis of trade liberalization of Asian dairy markets. The overview distills the findings of these new investigations and integrates them in the earlier economic literature; it draws policy implications and identifies lessons for countries outside of Asia, especially for emerging exporters in Latin America. |
| Keywords: | Asia, China, dairy, India, Japan, Korea, liberalization, trade integration. |
| Date: | 2005–09 |
| URL: | http://d.repec.org/n?u=RePEc:ias:cpaper:05-bp47&r=sea |
| By: | Fengxia Dong (Center for Agricultural and Rural Development (CARD); Food and Agricultural Policy Research Institute (FAPRI)) |
| Abstract: | The paper first presents a 10-year outlook for major Asian dairy markets (China, India, Indonesia, Japan, South Korea, Malaysia, the Philippines, Thailand, and Vietnam) based on a world dairy model. Then, using Heien and Wessells's technique, dairy product consumption growth is decomposed into contributions generated by income growth, population growth, price change, and urbanization and these contributions are quantified. Using the world dairy model, the paper also analyzes the impacts of alternative assumptions of higher income levels and technology development in Asia on Asian dairy consumptions and world dairy prices. The outlook projects that Asian dairy consumption will continue to grow strongly in the next decade. The consumption decomposition suggests that the growth would be mostly driven by income and population growth and, as a result, would raise world dairy prices. The simulation results show that technology improvement in Asian countries would dampen world dairy prices and meanwhile boost domestic dairy consumption. |
| Date: | 2005–06 |
| URL: | http://d.repec.org/n?u=RePEc:ias:cpaper:05-wp399&r=sea |
| By: | Yose Rizal Damuri (Department of Economics, CSIS Jakarta, Indonesia); Raymond Atje (Department of Economics, CSIS Jakarta, Indonesia); Arya B. Gaduh (Department of Economics, CSIS Jakarta, Indonesia) |
| Abstract: | The 1990s saw East Asia becoming more integrated as trade barriers fell, trade intensity and intra-industry trade increased, and production networks formed. This greater integration has resulted in changing patterns of trade specialization in the region, as different economies adjust. Some economies (especially resource-rich economies) maintain their top trade-specialty products, while others move towards higher-productivity manufacturing goods. Nonetheless, we observe in all East Asian countries in our study a trend towards specializing in products with higher sophistication and technological intensity. Meanwhile, our examination of the product specialization mobility and our empirical analysis suggest no indication of East Asian countries being in a "low-productivity specialization trap" which would disable them from shifting their specialization towards higher-productivity and higher-value goods. |
| Keywords: | trade specialization, regional integration, East Asia, trade barriers |
| JEL: | F13 F15 F17 |
| Date: | 2006–03 |
| URL: | http://d.repec.org/n?u=RePEc:eab:tradew:694&r=sea |
| By: | Pieter Bottelier (World Bank) |
| Abstract: | The World Bank played an important role in China's economic transformation since the late 1970s. China used the World Bank well and the Bank was responsive to China's needs. The Bank did not recommend early or comprehensive market liberalization or learning-by-doing - approach to economic reform. It pushed at the margin for critical institutional and policy reforms, presenting perspective based on international experience, while providing technical assisstance in numerous areas, often through Bank-supported projects. As the Chinese gained expertise, confidence and access to international capital markets, the role of the Bank in China inevitably shrank. China now uses the Bank mainly for selective technical, institutional and conceptual innovations for development. China and the World Bank both gained from their interaction. |
| Keywords: | World Bank, China, innovations, institutional reform, market liberalization , learning-by-doing |
| JEL: | O19 O11 |
| Date: | 2006–03 |
| URL: | http://d.repec.org/n?u=RePEc:eab:develo:691&r=sea |
| By: | Guonan Ma |
| Abstract: | This paper addresses the questions related to the cost of China’s bank restructuring and how it has been financed. We first propose a framework for recognising losses. Then, we examine the recent major moves by the Chinese government to repair the country’s bank balance sheets. Finally, we explore the implications of the Chinese ways of funding the bank restructuring. We find that the Chinese government has been decisive in confronting the costly task of bank restructuring. Looking through the elaborate funding arrangements adopted so far, the Chinese taxpayers have paid most of the bill. |
| Keywords: | Bank restructuring; recapitalisation; non-performing loans; China |
| JEL: | G21 G28 O53 P34 |
| Date: | 2006–02 |
| URL: | http://d.repec.org/n?u=RePEc:cii:cepidt:2006-04&r=sea |
| By: | Takatoshi Ito; Keisuke Orii |
| Abstract: | After the Asian currency crisis, most Asian economies have adopted managed float regimes, with notable exception of China, Hong Kong, and Malaysia. Various studies have examined the weights of the dollar, the yen, and the euro, regarding floating is loosely managed with reference to the basket currency system. However, results are mixed, in that in some periods, the yen weight seems to be higher in some countries, and in some other periods, the Asian currencies seem to have gone back to the dollar peg. This paper seeks the determinants of the yen weight in Asian currencies. It is found that the yen weight tends to increase when the yen depreciates and when the domestic interest rates rise. The yen weight tends to decrease when the US interest rate rises. Asymmetry is observed among coefficients of variables between the lower and higher yen periods. In addition, the yen weight is less susceptible to the overall position of the US dollar vis-a-vis major currencies. It should also be noted that the peculiarity among countries seems large in handling the currency weights in the basket. |
| Date: | 2006–04 |
| URL: | http://d.repec.org/n?u=RePEc:eti:dpaper:06020&r=sea |
| By: | Isabelle Schluep Campo; John C. Beghin (Center for Agricultural and Rural Development (CARD); Food and Agricultural Policy Research Institute (FAPRI)) |
| Abstract: | We explore and investigate Japanese dairy markets. We first provide an overview of consumer demand and how it evolved after World War II. Using historical data and econometric estimates of Japanese dairy demand, we identify economic, cultural, and demographic forces that have been shaping consumption patterns. Then we summarize the characteristics of Japanese milk production and dairy processing and policies affecting them. We next describe the import regime and trade flows in dairy products. The analysis of the regulatory system of the dairy sector shows how its incentive structure affects the long-term prospects of various segments of the industry. The paper concludes with policy recommendations of how to reform the Japanese dairy sector. |
| Keywords: | consumption, dairy, Japan, milk, policy, trade. |
| Date: | 2005–08 |
| URL: | http://d.repec.org/n?u=RePEc:ias:fpaper:05-wp401&r=sea |
| By: | Isabelle Schluep Campo; John C. Beghin (Center for Agricultural and Rural Development (CARD); Food and Agricultural Policy Research Institute (FAPRI)) |
| Abstract: | We explore and investigate Japanese dairy markets. We first provide an overview of consumer demand and how it evolved after World War II. Using historical data and econometric estimates of Japanese dairy demand, we identify economic, cultural, and demographic forces that have been shaping consumption patterns. Then we summarize the characteristics of Japanese milk production and dairy processing and policies affecting them. We next describe the import regime and trade flows in dairy products. The analysis of the regulatory system of the dairy sector shows how its incentive structure affects the long-term prospects of various segments of the industry. The paper concludes with policy recommendations of how to reform the Japanese dairy sector. |
| Keywords: | consumption, dairy, Japan, milk, policy, trade. |
| Date: | 2005–08 |
| URL: | http://d.repec.org/n?u=RePEc:ias:cpaper:05-wp401&r=sea |
| By: | Justin Yifu Lin (China Center for Economic Research, Peking University); Peilin Liu (Development Research Center of the State Council) |
| Abstract: | In this paper we propose that a flawed development strategy is responsible for the increasing disparities in economic development among provinces in China. Since the founding of the PRC, the government has pushed a "leap forward" strategy emphasizing the development of capital-intensive heavy industries. In most provinces, however, the priority industries under this strategy were inconsistent with the comparitive advantage determined by the factor endowments in those provinces. Many enterprises in the priority industries were not viable in the competitive market and required interventions in the merkets by the government to support and protect them. Consequently, this leap-forward strategy retarded the functions of market, impeded capital accumulation and hindered technology and productivity progress in the provinces. The provinces in the central and western provinces continue to follow the leap-forward strategy and have poor growth performance Therefore, it is imperitive to replace tha comparitive advantage-defying leap-forward strategy with a comparative advantage-following strategy and restructure the existing industries in each province according to the princple of comparitive advantage. This latter strategy would enhance coordinated development among regions and provinces and, in effect, work more effectively to create sustainable national economic development. The regional effects of economic strategies in China are the subject of this paper. |
| Keywords: | economic strategies, China, regional effects, development, PRC, leap-forward approach, capital-intensive, heavy industries, comparitive advantage |
| JEL: | R11 R12 R58 O12 |
| Date: | 2005–11 |
| URL: | http://d.repec.org/n?u=RePEc:eab:develo:656&r=sea |
| By: | Shuna Wang (Department of Economics, University of Virginia); Yang Yao (China Center for economic Research, Peking University) |
| Abstract: | This paper studies the impacts of village election on the accountability of the elected village committee, local fiscal sharing, and state taxation in rural China using panel data of 48 villages during the period of 1986-2002. Election is found to substantially increase the share of public expenditures in the village budget and reduce the shares of administrative costs and income handed to the township government. This shows that election enhances the accountability of the village committee, but weakens local fiscal sharing, and thus, may hurt public goods provision beyond the village boundary. In addition, election also reduces the amount of tax paid by each person in the village, which means that election does lessen the state's grip on the grassroots society. Finally, no significant evidence is found to support the claim that the role of a more competitive election is different from that of a closed election. |
| Keywords: | Multinational model, East Asian interdependency, exchange rates, asymmetric shocks |
| JEL: | C52 F15 F17 F42 |
| Date: | 2006–02 |
| URL: | http://d.repec.org/n?u=RePEc:eab:govern:680&r=sea |
| By: | Takatoshi Ito; Kiyotaka Sato |
| Abstract: | The pass-through effects of exchange rate changes on the domestic prices in the East Asian countries are examined using a VAR analysis including several price indices and domestic macroeconomic variables as well as the exchange rate. Results from the VAR analysis show that (1) the degree of exchange rate pass-through to import prices was quite high in the crisis-hit countries; (2) the pass-through to CPI was generally low, with a notable exception of Indonesia: and (3) in Indonesia, both the impulse response of monetary policy variables to exchange rate shocks and that of CPI to monetary policy shocks are positive, large and statistically significant. Thus, Indonesia's accommodative monetary policy as well as the high degree of the CPI responsiveness to exchange rate changes was important factors that resulted in the spiraling effects of domestic price inflation and sharp nominal exchange rate depreciation in the post-crisis period. |
| Date: | 2006–04 |
| URL: | http://d.repec.org/n?u=RePEc:eti:dpaper:06018&r=sea |
| By: | Frank H. Fuller (Center for Agricultural and Rural Development (CARD); Food and Agricultural Policy Research Institute (FAPRI); Midwest Agribusiness Trade Research and Information Center (MATRIC)); Jikun Huang; Hengyun Ma; Scott Rozelle |
| Abstract: | With the rapid growth in China's dairy industry, a number of recent papers have addressed either the supply or the demand trends for dairy products in China. None, however, presents a systematic explanation for the recent growth in both the supply and demand for dairy products. The goal of this paper is to sketch a more comprehensive picture of China's dairy sector and to assess the nature of the sector's development in the coming decades. Drawing upon several empirical studies, we examine the trends in dairy product consumption to create a composite picture of the factors underlying the recent growth. We also empirically investigate the sources of production gains in milk supply and assess the relative importance of expanding herd size, changes in the nature of production, technological change, and improvements in efficiency to the overall growth of milk production. |
| Keywords: | China, consumption, dairy, milk supply, stochastic production frontier, total factor productivity. |
| Date: | 2005–05 |
| URL: | http://d.repec.org/n?u=RePEc:ias:fpaper:05-wp394&r=sea |
| By: | Frank H. Fuller (Center for Agricultural and Rural Development (CARD); Food and Agricultural Policy Research Institute (FAPRI); Midwest Agribusiness Trade Research and Information Center (MATRIC)); Jikun Huang; Hengyun Ma; Scott Rozelle |
| Abstract: | With the rapid growth in China's dairy industry, a number of recent papers have addressed either the supply or the demand trends for dairy products in China. None, however, presents a systematic explanation for the recent growth in both the supply and demand for dairy products. The goal of this paper is to sketch a more comprehensive picture of China's dairy sector and to assess the nature of the sector's development in the coming decades. Drawing upon several empirical studies, we examine the trends in dairy product consumption to create a composite picture of the factors underlying the recent growth. We also empirically investigate the sources of production gains in milk supply and assess the relative importance of expanding herd size, changes in the nature of production, technological change, and improvements in efficiency to the overall growth of milk production. |
| Keywords: | China, consumption, dairy, milk supply, stochastic production frontier, total factor productivity. |
| Date: | 2005–05 |
| URL: | http://d.repec.org/n?u=RePEc:ias:cpaper:05-wp394&r=sea |
| By: | Jacinto F. Fabiosa (Center for Agricultural and Rural Development (CARD); Food and Agricultural Policy Research Institute (FAPRI)); Dinghuan Hu; Cheng Fang |
| Abstract: | In China, with the cost of improved technology rising, surplus labor shrinking, and demand for food quality and safety increasing, it will be just a matter of time before the country's hog production sector will be commercialized like that of developed countries. However, even if China's cost of production converges to international levels, as shown in this case study, China may continue to retain some competitive advantage because of the labor-intensive nature of the marketing services involved in hog processing and meat distribution. The supply of variety meats offers the most promising market opportunity for foreign suppliers in China. The market may open further if the tariff rate for variety meats is reduced from 20% and harmonized with the pork muscle meat rate of 12%, and if the value-added tax of 13% is applied equally to both imported and domestic products. The fast-growing Western-style family restaurant and higher-end dining sector is another market opportunity for high-quality imported pork. |
| Keywords: | commercial, cost structure, imports, pork value chain. |
| Date: | 2005–08 |
| URL: | http://d.repec.org/n?u=RePEc:ias:fpaper:05-mrp11&r=sea |
| By: | Jacinto F. Fabiosa (Center for Agricultural and Rural Development (CARD); Food and Agricultural Policy Research Institute (FAPRI)); Dinghuan Hu; Cheng Fang |
| Abstract: | In China, with the cost of improved technology rising, surplus labor shrinking, and demand for food quality and safety increasing, it will be just a matter of time before the country's hog production sector will be commercialized like that of developed countries. However, even if China's cost of production converges to international levels, as shown in this case study, China may continue to retain some competitive advantage because of the labor-intensive nature of the marketing services involved in hog processing and meat distribution. The supply of variety meats offers the most promising market opportunity for foreign suppliers in China. The market may open further if the tariff rate for variety meats is reduced from 20% and harmonized with the pork muscle meat rate of 12%, and if the value-added tax of 13% is applied equally to both imported and domestic products. The fast-growing Western-style family restaurant and higher-end dining sector is another market opportunity for high-quality imported pork. |
| Keywords: | commercial, cost structure, imports, pork value chain. |
| Date: | 2005–08 |
| URL: | http://d.repec.org/n?u=RePEc:ias:cpaper:05-mrp11&r=sea |
| By: | Jacinto F. Fabiosa (Center for Agricultural and Rural Development (CARD); Food and Agricultural Policy Research Institute (FAPRI)) |
| Abstract: | In the decade of the 1990s, China's feed sector became increasingly privatized, more feed mills opened, and the scale of operation expanded. Capacity utilization remained low and multi-ministerial supervision was still prevalent, but the feed mill sector showed a positive performance overall, posting a growth rate of 11 percent per year. Profit margin over sales was within allowable rates set by the government of China at 3 to 5 percent. Financial efficiency improved, with a 20 percent quicker turnover of working capital. Average technical efficiency was 0.805, as more efficient feed mills increasingly gained production shares. This study finds evidence that the increasing privatization explains the improved performance of the commercial feed mill sector. The drivers that shaped the feed mill sector in the 1990s have changed with China's accession to the World Trade Organization. With the new policy regime in place, the study foresees that, assuming an adequate supply of soy meal and an excess capacity in the feed mill sector, it is likely that China will allow corn imports up to the tariff rate quota (TRQ) of 7.2 mmt since the in-quota rate is very low at 1 percent. However, when the TRQ is exceeded, the import duty jumps to a prohibitive out-quota rate of 65 percent. With an import duty for meat of only 10 to 12 percent, China would have a strong incentive to import meat products directly rather than bringing in expensive corn to produce meat domestically. This would be further reinforced if structural transformation in the swine sector would narrow the cost differential between domestic and imported pork. |
| Keywords: | China, feed mill sector, privatization, trade. |
| Date: | 2005–04 |
| URL: | http://d.repec.org/n?u=RePEc:ias:fpaper:05-mrp10&r=sea |
| By: | Jacinto F. Fabiosa (Center for Agricultural and Rural Development (CARD); Food and Agricultural Policy Research Institute (FAPRI)) |
| Abstract: | In the decade of the 1990s, China's feed sector became increasingly privatized, more feed mills opened, and the scale of operation expanded. Capacity utilization remained low and multi-ministerial supervision was still prevalent, but the feed mill sector showed a positive performance overall, posting a growth rate of 11 percent per year. Profit margin over sales was within allowable rates set by the government of China at 3 to 5 percent. Financial efficiency improved, with a 20 percent quicker turnover of working capital. Average technical efficiency was 0.805, as more efficient feed mills increasingly gained production shares. This study finds evidence that the increasing privatization explains the improved performance of the commercial feed mill sector. The drivers that shaped the feed mill sector in the 1990s have changed with China's accession to the World Trade Organization. With the new policy regime in place, the study foresees that, assuming an adequate supply of soy meal and an excess capacity in the feed mill sector, it is likely that China will allow corn imports up to the tariff rate quota (TRQ) of 7.2 mmt since the in-quota rate is very low at 1 percent. However, when the TRQ is exceeded, the import duty jumps to a prohibitive out-quota rate of 65 percent. With an import duty for meat of only 10 to 12 percent, China would have a strong incentive to import meat products directly rather than bringing in expensive corn to produce meat domestically. This would be further reinforced if structural transformation in the swine sector would narrow the cost differential between domestic and imported pork. |
| Keywords: | China, feed mill sector, privatization, trade. |
| Date: | 2005–04 |
| URL: | http://d.repec.org/n?u=RePEc:ias:mpaper:05-mrp10&r=sea |
| By: | Jacinto F. Fabiosa (Center for Agricultural and Rural Development (CARD); Food and Agricultural Policy Research Institute (FAPRI)) |
| Abstract: | In the decade of the 1990s, China's feed sector became increasingly privatized, more feed mills opened, and the scale of operation expanded. Capacity utilization remained low and multi-ministerial supervision was still prevalent, but the feed mill sector showed a positive performance overall, posting a growth rate of 11 percent per year. Profit margin over sales was within allowable rates set by the government of China at 3 to 5 percent. Financial efficiency improved, with a 20 percent quicker turnover of working capital. Average technical efficiency was 0.805, as more efficient feed mills increasingly gained production shares. This study finds evidence that the increasing privatization explains the improved performance of the commercial feed mill sector. The drivers that shaped the feed mill sector in the 1990s have changed with China's accession to the World Trade Organization. With the new policy regime in place, the study foresees that, assuming an adequate supply of soy meal and an excess capacity in the feed mill sector, it is likely that China will allow corn imports up to the tariff rate quota (TRQ) of 7.2 mmt since the in-quota rate is very low at 1 percent. However, when the TRQ is exceeded, the import duty jumps to a prohibitive out-quota rate of 65 percent. With an import duty for meat of only 10 to 12 percent, China would have a strong incentive to import meat products directly rather than bringing in expensive corn to produce meat domestically. This would be further reinforced if structural transformation in the swine sector would narrow the cost differential between domestic and imported pork. |
| Keywords: | China, feed mill sector, privatization, trade. |
| Date: | 2005–04 |
| URL: | http://d.repec.org/n?u=RePEc:ias:cpaper:05-mrp10&r=sea |
| By: | Mark R. Rosenzweig (Yale University); Junsen Zhang (Chinese University of Hong Kong and IZA Bonn) |
| Abstract: | In this paper we use a new data set describing households with and without twin children in China to quantify the trade-off between the quality and quantity of children using the incidence of twins that for the first time takes into account effects associated with the lower birthweight and closer-spacing of twins compared to singleton births. We show that examining the effects of twinning by birth order, net of the effects stemming from the birthweight deficit of twins, can provide upper and lower bounds on the trade-off between family size and average child quality. Our estimates indicate that, at least in one area of China, an extra child at parity one or at parity two, net of birthweight effects, significantly decreases the schooling progress, the expected college enrollment, grades in school and the assessed health of all children in the family. We also show that estimates of the effects of twinning at higher parities on the outcomes of older children in prior studies do not identify family size effects but are confounded by inter-child allocation effects because of the birthweight deficit of twins. Despite the evident significant trade-off between number of children and child quality in China, however, the findings suggest that the contribution of the one-child policy in China to the development of its human capital was modest. |
| Keywords: | family size, birthweight, twins, schooling, China |
| JEL: | J13 I12 I21 |
| Date: | 2006–04 |
| URL: | http://d.repec.org/n?u=RePEc:iza:izadps:dp2082&r=sea |
| By: | Eiji Ogawa; Michiru Sakane |
| Abstract: | In this paper, we investigate the actual exchange rate policy conducted by the Chinese government after the Chinese exchange rate system reform on July 21 2005. Also, we investigate long-run effect (Balassa-Samuelson effect) on the Chinese yuan. We found that the Chinese government had a statistically significant but small change in exchange rate policy during our sample period to January 25, 2006. It is not identified that the Chinese monetary authority is adopting the currency basket system because the change is too small in the economic sense. On one hand, higher growth rate of productivity will appreciate the Chinese yuan in terms of the US dollar and the Japanese yen while higher growth rates of productivity in Chinese tradable good sector tend to give the Balassa-Samuleson effect, that is undervaluation bias, to the Chinese yuan. |
| Date: | 2006–04 |
| URL: | http://d.repec.org/n?u=RePEc:eti:dpaper:06019&r=sea |
| By: | Ono, Hiroshi (European Institute of Japanese Studies) |
| Abstract: | This paper poses three fundamental questions about lifetime employment in Japan: How big is it? How unique is it? And, how is it changing? I examine different concepts and methods for estimating lifetime employment and conclude that it covers roughly 20 percent of the Japanese labor force. Job mobility remains considerably lower in Japan than in other economies (particularly the U.S.). Evidence regarding changes in lifetime employment is mixed. The share of workers in the core, an ex-ante measure of lifetime employment, is declining. But the probability of job separations has remained stable for those who are already in the system. I also find evidence that the incentives among workers, managers and executives are aligned to preserve the lifetime employment system. |
| Keywords: | Lifetime employment; job mobility |
| JEL: | J24 J42 J62 |
| Date: | 2006–03–28 |
| URL: | http://d.repec.org/n?u=RePEc:hhs:hastef:0624&r=sea |
| By: | Asep Suryahadi (SMERU Research Institute); Daniel Suryadarma (SMERU Research Institute); Sudarno Sumarto (SMERU Research Institute) |
| Abstract: | Indonesia experienced a rapid reduction in poverty during the pre-crisis high growth period prior to 1997. On the other hand, poverty increased very significantly when the economy contracted during the economic crisis. These contrasting episodes provide a natural experiment to assess empirically the relationship between economic growth and poverty. This study finds that economic growth is indeed an essential recipe for poverty reduction. However, not all sectoral components of economic growth contribute equally to poverty reduction. In particular, growth of the services sector, both in urban and rural areas, contributes the most to the reduction in poverty. Another sectoral growth which has significant, albeit relatively small, contribution to poverty reduction is industrial growth in urban areas. This pattern of growth components with significant contributions to poverty reduction is identical for total, urban, and rural poverty. |
| Keywords: | economic growth, poverty, urban, rural, Indonesia |
| JEL: | O11 I32 N15 |
| Date: | 2006–03 |
| URL: | http://d.repec.org/n?u=RePEc:eab:develo:692&r=sea |
| By: | Ricardo J. Caballero; Takeo Hoshi; Anil K. Kashyap |
| Abstract: | In this paper, we propose a bank-based explanation for the decade-long Japanese slowdown following the asset price collapse in the early 1990s. We start with the well known observation that most large Japanese banks were only able to comply with capital standards because regulators were lax in their inspections. To facilitate this forbearance the banks often engaged in sham loan restructurings that kept credit flowing to otherwise insolvent borrowers (that we call zombies). Thus, the normal competitive outcome whereby the zombies would shed workers and lose market share was thwarted. Our model highlights the restructuring implications of the zombie problem. The counterpart of the congestion created by the zombies is a reduction of the profits for healthy firms, which discourages their entry and investment. In this context, even solvent banks will not find good lending opportunities. We confirm our story’s key predictions that zombie dominated industries exhibit more depressed job creation and destruction, and lower productivity. We present firm-level regressions showing that the increase in zombies depressed the investment and employment growth of non-zombies and widened the productivity gap between zombies and non-zombies. |
| JEL: | E44 G34 L16 O53 |
| Date: | 2006–04 |
| URL: | http://d.repec.org/n?u=RePEc:nbr:nberwo:12129&r=sea |
| By: | Peter Wilson (Department of Economics, National University of Singapore 1 Arts Link, Singapore); Henry Ng Shang Ren |
| Abstract: | The objective of this paper is see how well Singapore’s exchange rate regime has coped with exchange rate volatility before and after the Asian financial crisis by comparing the performance of Singapore’s actual regime in minimising the volatility of the nominal effective exchange rate (NEER) and the bilateral rate against the US$ against some counterfactual regimes and the corresponding performance of eight other East Asian countries. In contrast to previous counterfactual exercises, such as Williamson (1998a) and Ohno (1999) which compute the weights for effective exchange rates on the basis of simple bloc aggregates, we apply a more disaggregated methodology using a larger number of trade partners. We also utilize ARCH/GARCH techniques to obtain estimates of heteroskedastic variances to better capture the time-varying characteristics of volatility for the actual and simulated exchange rate regimes. Our findings confirm that Singapore’s managed floating exchange rate system has delivered relatively low currency volatility. Although there are gains in volatility reduction for all countries in the sample from the adoption of either a unilateral or common basket peg, particularly post-crisis, these gains are relatively low for Singapore, largely because low actual volatility. Finally, there are additional gains for nondollar peggers from stabilizing intra-EA exchange rates against the dollar if they were to adopt a basket peg, especially post-crisis, but the gains for Singapore are again relatively modest. |
| Keywords: | East Asia, exchange rates, counterfactuals. |
| JEL: | F31 F33 F36 |
| URL: | http://d.repec.org/n?u=RePEc:sca:scaewp:0608&r=sea |
| By: | Fabiosa, Jacinto F. |
| Abstract: | With sustained income growth and fast urbanization, Indonesia will see a major shift in the growth of grain consumption from rice to wheat products. New demand estimates from consumption survey data give a relatively high income elasticity of demand for wheat-based products, in the range of 0.44 to 0.84, with 26% to 34% of this response coming from the impact of income on the probability of consumption for non-consuming households and the remaining impact coming from the response on the level of consumption for households currently consuming wheat products. Urban location of households also contributes an increase of 0.11% to 0.13% to consumption. In contrast, elasticities in rice show a negative impact of income and urbanization on the probability of consumption and a positive but small impact on the unconditional mean. A partial liberalization scenario shows the domestic wheat flour price declining by 13.66%, inducing consumption to increase by 7.06%, which translates into 7.04% growth in imports. This exerts an upward pressure on the world price, increasing it by 0.23%. A faster income growth scenario shows higher consumption (2.60%), imports (2.59%), and prices (0.09%). Countries with a proximity advantage such as Australia, China, and India will benefit from the growth in this market. But, with dependable supply, product quality assurance, and credit availability, North American suppliers may still remain in this market. |
| Keywords: | double-hurdle demand, trade, Westernization of diet. |
| Date: | 2006–04–14 |
| URL: | http://d.repec.org/n?u=RePEc:isu:genres:12587&r=sea |
| By: | R. Anton Braun (Faculty of Economics, University of Tokyo); Max Gillman (Department of Economics, Boston University) |
| Abstract: | Japan has now experienced over a decade of slow growth and deflation. This period has also been associated with protracted problems in the banking sector. A wide range of measures have been tried in to restore health in the banking sector including recapitalization, the extension of 100% guarantees to all deposits, and central bank purchases of shares held by banks. It has also argued that ending deflation is an important ingredient in restoring banking sector health. This paper develops a general equilibrium of the banking sector. In our model the banking sector produces an intermediate good that is used to produce investment goods and a variable fraction of consumption goods. We then assess the implications of alternative policies designed to assist the banking sector in terms of their implications for welfare and the size and profitability of the banking sector. |
| Date: | 2006–04 |
| URL: | http://d.repec.org/n?u=RePEc:tky:fseres:2006cf412&r=sea |
| By: | Shu-ichi Akiyama; Nobuhiro Hosoe |
| Abstract: | A key intention of the regulatory reform of transmission charge schemes on Japan's electric power market was to promote inter-regional competition between power suppliers by lowering long-distance transmission charges with a postage-stamp charge scheme. This can lead to extensive use of inter-regional links and cause congestion. Congestion segments the market into several regional markets, making the reform less successful. We developed a nine-region spatial equilibrium model to simulate the reform at the peak-load hour. We found the reform would lead to significant increases of inter-regional transmission and congestion at the link between the 50-Hz area and the 60-Hz area. |
| Date: | 2006–04 |
| URL: | http://d.repec.org/n?u=RePEc:eti:dpaper:06022&r=sea |
| By: | Kazuyuki Motohashi |
| Abstract: | In this paper, IP strategy at firm level is analyzed in a framework of use of patent as a tool for maximizing firm's revenue, based on a dataset from JPO's Survey of Intellectual Property Activities in 2004. Descriptive regressions of IP strategy indicators suggest a non-linear relationship between firm size and licensing propensity. For a small firm with less complementary assets, such as production facility and marketing channels, tends to license more. At the same time, a licensing propensity of large firm is also high due to the effect of cross licensing. |
| Date: | 2006–04 |
| URL: | http://d.repec.org/n?u=RePEc:eti:dpaper:06021&r=sea |
| By: | Hermes, N.; Smid, P.; Yao, L. (Groningen University) |
| Abstract: | This paper compares the use of capital budgeting techniques of Dutch and Chinese firms, using data obtained from a survey among 250 Dutch and 300 Chinese companies. Our main aim is to analyse the use of capital budgeting techniques by companies in both countries from a comparative perspective to see whether economic development matters. The empirical analysis provides evidence that Dutch CFOs on average use more sophisticated capital budgeting techniques than Chinese CFOs do. At the same, however, our results suggest that the difference between Dutch and Chinese firms is smaller than might have been expected based upon the differences in the level of economic development between both countries, at least with respect to the use of methods of estimating the cost of capital and the use of CAPM as the method of estimating the cost of equity. |
| Date: | 2006 |
| URL: | http://d.repec.org/n?u=RePEc:dgr:rugsom:06e02&r=sea |
| By: | Jacinto F. Fabiosa (Center for Agricultural and Rural Development (CARD); Food and Agricultural Policy Research Institute (FAPRI)) |
| Abstract: | New elasticities were estimated from Indonesia's 1996, 1999, and 2002 National Socio-Economic Survey, or SUSENAS, data using a double-hurdle demand specification. The estimates suggest that major changes in Indonesian household diets are expected in the coming years, as income growth is sustained and as urbanization proceeds at a fast pace. The consumption "trading-up" pattern for animal-protein source products observed in many countries may also occur in Indonesia. In this particular case, households will shift from fish to dairy and meat products. The trade impacts of this emerging consumption pattern will be determined by the cost of adjustment in Indonesia's domestic productive capacity and the influence of the country's predominantly Islamic tradition. |
| Keywords: | demand, household consumption, trade. |
| Date: | 2005–07 |
| URL: | http://d.repec.org/n?u=RePEc:ias:fpaper:05-wp400&r=sea |
| By: | Jacinto F. Fabiosa (Center for Agricultural and Rural Development (CARD); Food and Agricultural Policy Research Institute (FAPRI)) |
| Abstract: | New elasticities were estimated from Indonesia's 1996, 1999, and 2002 National Socio-Economic Survey, or SUSENAS, data using a double-hurdle demand specification. The estimates suggest that major changes in Indonesian household diets are expected in the coming years, as income growth is sustained and as urbanization proceeds at a fast pace. The consumption "trading-up" pattern for animal-protein source products observed in many countries may also occur in Indonesia. In this particular case, households will shift from fish to dairy and meat products. The trade impacts of this emerging consumption pattern will be determined by the cost of adjustment in Indonesia's domestic productive capacity and the influence of the country's predominantly Islamic tradition. |
| Keywords: | demand, household consumption, trade. |
| Date: | 2005–07 |
| URL: | http://d.repec.org/n?u=RePEc:ias:cpaper:05-wp400&r=sea |
| By: | Jean-Yves Duclos (Université Laval, CIRPÉE and IZA Bonn); Abdelkrim Araar (Université Laval, CIRPÉE); John Giles (Michigan State University) |
| Abstract: | The paper contributes to the measurement of poverty and vulnerability in three ways. First, we propose a new approach to separating poverty into chronic and transient components. Second, we provide corrections for the statistical biases introduced when using a small number of periods to estimate the importance of vulnerability and transient poverty. Third, we apply these tools to the measurement of chronic and transient poverty in China using a rich panel data set that extends over approximately 17 years. We find that alternative measurement techniques yield significantly different estimates of the relative importance of chronic and transient poverty, and that precision of estimates is enhanced with simple statistical corrections. |
| Keywords: | poverty dynamics, transient poverty, chronic poverty, permanent poverty, China |
| JEL: | C15 D31 D63 I32 |
| Date: | 2006–04 |
| URL: | http://d.repec.org/n?u=RePEc:iza:izadps:dp2078&r=sea |
| By: | Carlo Carraro (Department of Economics, University Of Venice Cà Foscari); Barbara Buchner (Fondazione Eni Enrico Mattei) |
| Abstract: | Despite the entry into force of the Kyoto Protocol, the US decision not to comply with its Kyoto commitments seems to drastically undermine the effectiveness of the Protocol in controlling GHG emissions. Therefore, it is important to explore whether there are economic incentives that might help the US to modify its current decision and move to a more environmentally effective climate policy. For example, can an increased participation of developing countries induce the US to effectively participate in the effort to reduce GHG emissions? Is a single emission trading market the appropriate policy framework to increase the signatories of the Kyoto Protocol? This paper addresses the above questions by analysing whether the participation of China in the cooperative effort to control GHG emissions can provide adequate incentives for the US to re-join the Kyoto process and eventually ratify the Kyoto Protocol. This paper analyses three different climate regimes in which China could be involved and assesses the economic incentives for the major world countries and regions to participate in these three regimes. The main conclusion is that the participation of the US in a climate regime is not likely, at least in the short run. The US is more likely to adopt unilateral policies than to join the present Kyoto coalition (even when it includes China). However, a two bloc regime would become the most preferred option if both China and the US, for some political or environmental reasons, decide to cooperate on GHG emission control. If the US decides to cooperate, the climate regime that provides the highest economic incentives to the cooperating countries is the one in which China and the US cooperate bilaterally, with the Annex B-US countries remaining within the Kyoto framework. |
| Keywords: | Agreements, Climate, Incentives, Negotiations, Policy |
| JEL: | C72 H23 Q25 Q28 |
| Date: | 2006 |
| URL: | http://d.repec.org/n?u=RePEc:ven:wpaper:07_06&r=sea |
| By: | Jim Hight; Grant Kirkpatrick |
| Abstract: | Reflecting the desire for cleaner air, many developing countries have enacted clean air laws similar to those of developed nations, although to date most of these laws have been poorly enforced. A key starting point to better enforcement is obtaining comprehensive and reliable air-quality monitoring data. This report explores the impacts of air quality monitoring programmes implemented over the last decade in five developing countries: Morocco, the Philippines, Malaysia, Indonesia, and India. These case studies also examine the role of procurement of specialised equipment, usually imported, associated with the various air quality monitoring programmes. |
| Keywords: | trade, developing countries, environmental goods, air quality |
| Date: | 2006–04–04 |
| URL: | http://d.repec.org/n?u=RePEc:oec:traaaa:2006/2-en&r=sea |
| By: | Christer Ljungwall (China Center for Economic Research, Peking University); Örjan Sjöberg (Depertment of Economics and the School of Asian Studies/ EIJS Stockholm School of Economics) |
| Abstract: | In Pacific Asia, globalization has resulted in rapidly growing international flows of goods, portfolio capital, and direct investments. At the same time, several countries shift from a command to market economy. Against this background, we analyze the perhaps most popular model used to depict the process of economic integration and development in Pacific Asia, the flying geese pattern of shifting comparative advantage. Our point of departure is that economic and other social processes are best understood in relation to one another. We confine ourselves to intraregional patterns of trade and investment but locate them within the broader framework of global trends. |
| Keywords: | Asia, Globalization, Flying Geese Model, Comparative Advantage |
| JEL: | F02 F15 F21 O5 O53 |
| Date: | 2005–11 |
| URL: | http://d.repec.org/n?u=RePEc:eab:develo:659&r=sea |
| By: | Seppo Pynnönen; Warren P. Hogan; Jonathan A. Batten |
| Abstract: | Understanding the long term relationship between the yields of risky and riskless bonds is a critical task for portfolio managers and policy makers. This study specifies an equilibrium correction model of the credit spreads between Japanese Government bonds (JGBs) and Japanese yen Eurobonds with high quality credit ratings. The empirical results indicate that the corporate bond yields are cointegrated with the otherwise equivalent JGB yields, with the spread defining the cointegration relation. In addition the results indicate that the equilibrium correction term is highly statistically significant in modelling credit spread changes. Another important factor is the risk-free interest rate with the negative sign, while there is little evidence of the contribution of the asset return to the behaviour of spreads. |
| Date: | 2006–04–05 |
| URL: | http://d.repec.org/n?u=RePEc:iis:dispap:iiisdp127&r=sea |
| By: | K. Fukasaku; M. Kawai; M. G. Plummer; A. Trzeciak-Duval |
| Abstract: | OECD countries face at least five major challenges for promoting policies that are consistent with their development goals: . ensuring security and political stability; . anticipating the impacts of their macroeconomic policies on developing-country growth; . increasing both market access and capacity building for developing economies; . supporting governance structures that help maintain financial stability; . improving aid effectiveness. |
| Date: | 2005–05–16 |
| URL: | http://d.repec.org/n?u=RePEc:oec:devaab:26-en&r=sea |
| By: | Souleymane COULIBALY |
| Abstract: | Many recent papers have pointed to ambiguous trade effects of developing regional trade agreements, calling for a reassessment of their economic merits. We focus on six such agreements currently in force in Sub-Saharan Africa, Asia and Latin America, estimating their impacts on trade flows and welfare. We combine a gravity model with kernel and bootstrap estimation techniques so as to capture the non-monotonic trade effects while imposing minimal structure. Instead of the usual dummy variables for RTAs, we propose a new variable, capturing the number of years of a country's RTA membership, and we adapt the framework proposed by Winters (1997) to relate trade effects to their welfare implications. The results indicate that only AFTA and MERCOSUR have induced positive trade and welfare effects. The remaining RTAs have produced mixed effects for their members. |
| Keywords: | regional trade agreement; kernel regression; bootstrap; welfare |
| JEL: | F11 F15 O50 |
| Date: | 2006–04 |
| URL: | http://d.repec.org/n?u=RePEc:lau:crdeep:06.03&r=sea |
| By: | Qing Liu; Shouyong Shi |
| Abstract: | In this paper we integrate the recent development in monetary theory with international finance, in order to examine the coordination between two currency areas in setting long-run inflation. The model determines the value of each currency and the size of each currency area without requiring buyers to use a particular currency to buy a country's goods. We show that the two countries inflate above the Friedman rule in a non-cooperative game. Coordination between the two areas reduces inflation to the Friedman rule, increases consumption, and improves welfare of both countries. This gain from coordination increases as the two areas become more integrated in trade. These results arise from the new features of the model, such as the deviations from the law of one price and the extensive margin of trade. To illustrate these new features, we show that introducing a direct tax on foreign holdings of a currency does not eliminate a country's incentive to inflate, while it does in traditional models. |
| Keywords: | Exchange rates; Currency areas; Coordination |
| JEL: | F41 E40 |
| URL: | http://d.repec.org/n?u=RePEc:tor:tecipa:tecipa-226&r=sea |
| By: | Carlo Carraro (Department of Economics, University Of Venice Cà Foscari); Barbara Buchner |
| Abstract: | controlling GHG emissions without the involvement of countries such as China, India, the United States, Aust rali a, and possibly other developing countries. This highlights an unambiguous weakness of the Kyoto Protocol, where the aforementioned countries either have no binding emission targets or have decided not to comply with their targets . Therefore, when discussing possible post-Kyoto scenarios, it is crucial to priori tise part icipation incentives for all countries, especially those without explicit or with insufficient abatement targets. This paper offers a bottom-up game-theoretic perspective on participation incentives. Rather than focusing on issue linkage, t ransfers or burden sharing as tools to enhance the incentives to par t icipate in a climate agreement, thi s paper aims at exploring whether a di fferent policy approach could lead more count ries to adopt ef fective climate cont rol policies. This policy approach is explicitly bottom-up, namely i t gives each country the freedom to sign agreements and deals, bilateral ly or multila terally, with other countries, without being constrained by any globa l protocol or convention. This study provides a game-theoretic assessment of this policy approach and then evaluates empirically the possible endogenous emergence of single or multi ple climate coalitions. Welfare and technological consequences of different mul tiple bloc climate regimes will be assessed and their overall environmental effectiveness will be discussed. |
| Keywords: | Agreements, Climate, Incentives, Negotiations, Policy |
| JEL: | C72 H23 Q25 Q28 |
| Date: | 2006 |
| URL: | http://d.repec.org/n?u=RePEc:ven:wpaper:10_06&r=sea |
| By: | Joseph Francois (Erasmus Universiteit Rotterdam); Julia Woerz (WIIW, Vienna) |
| Abstract: | We develop a mixed complementarity programming (MCP) based estimating framework for non-tariff barriers (NTBs) to examine the evolution of market access conditions in the textile and clothing sectors, working with a panel of bilateral trade data on textile and clothing trade, underlying bilateral tariffs, and the country-pair coverage of quotas under the WTO's Agreement on Textiles and Clothing (ATC). Our estimating framework takes advantage of the panel nature of trade data when calculating export tax equivalents while allowing for inequality constraints on the quota premium estimates. We also introduce Gaussian quadrature for estimating goodness of fit for regression-based NTB measures based on residual fitting. |
| Keywords: | NTB estimation; Gaussian quadrature; ATC; MFA; import quotas |
| JEL: | F13 C15 |
| URL: | http://d.repec.org/n?u=RePEc:dgr:uvatin:20060007&r=sea |
| By: | Michel Lelart (LEO - Laboratoire d'économie d'Orleans - http://www.univ-orleans.fr/DEG/LEO - [CNRS : UMR6221] - [Université d'Orléans] - []) |
| Abstract: | Ce Forum organisé par l'Assistance au Développement des Echanges en Technologie Economique et Financière (ADETEF) près du Ministère des Finances a abordé plusieurs aspects du financement de l'économie vietnamienne. Le micro-crédit est aussi très développé dans ce pays où une loi vient d'être votée à son sujet. Ma contribution fait le point des différentes expériences menées actuellement au Vietnam et fait apparaître quelques-uns des problèmes qu'elles soulèvent. |
| Keywords: | micro-crédit ; micro-finance ; institution de micro-finance ; Vietnam |
| Date: | 2006–03–30 |
| URL: | http://d.repec.org/n?u=RePEc:hal:papers:halshs-00009839_v1&r=sea |
| By: | Robert Fleetcroft (School of Medicine, Health Policy and Practice, University of East Anglia); Richard Cookson (Centre for Health Economics, University of York) |
| Abstract: | The new contract for primary care in the UK offers fee-for-service payments for a wide range of activities in a quality outcomes framework, with payments designed to reflect likely workload. This study aims to explore the link between these financial incentives and the likely population health gains. The study examines a subset of eight preventive interventions covering 38 of the 81 clinical indicators in the quality framework. The maximum payment for each service was calculated and compared with the likely population health gain in terms of lives saved per 100,000 population based on evidence from McColl et al. (1998). Maximum payments for the eight interventions examined make up 57% of the sum total maximum payment for all clinical interventions in the quality outcomes framework. There appears to be no relationship between pay and health gain across these eight interventions. Two of the eight interventions (warfarin in atrial fibrillation and statins in primary prevention) receive no incentive. Payments in the new contract do not reflect likely population health gain. There is a danger that clinical activity may be skewed towards high-workload activities that are only marginally effective, to the detriment of more cost effective activities. If improving population health is the primary goal of the NHS, then fee-for-service incentives should be designed to reflect likely health gain rather than likely workload. |
| Keywords: | health policy, incentive payments, primary care, quality, UK |
| Date: | 2005–05 |
| URL: | http://d.repec.org/n?u=RePEc:chy:respap:3&r=sea |