nep-sea New Economics Papers
on South East Asia
Issue of 2006‒09‒03
sixteen papers chosen by
Kavita Iyengar
Asian Development Bank

  1. Water Policy Briefing: Choosing Appropriate Responses to Groundwater Depletion By International Water Management Institute
  2. Chinese Agricultural Reform the WTO and FTA Negotiations By Shunli Yao
  3. Has Japan's Long-term employment Practice Survived? New Evidence Emerging Since the 1990s By Satoshi Shimizutani; Izumi Yokoyama
  4. Revisiting the Revolving Door: Capital Flight from Southeast Asia By Edsel L. Beja, Jr.
  5. The Shadow of Death: Pre-exit Performance of Firms in Japan By Kozo Kiyota; Miho Takizawa
  6. The Incentive to Declare Taxes and Tax Revenue: The Lottery Receipt Experiment in China By Junmin Wan
  7. Wage Distribution in Japan: 1989-2003 By Ryo Kambayashi; Daiji Kawaguchi; Izumi Yokoyama
  8. An exploration of the need for and cost of selected trade facilitation measures in Asia-Pacific in the context of the WTO negotiations By Yann Duval
  9. Household Energy Demand and the Equity and Efficiency Aspects of Subsidy Reform in Indonesia By Susan Olivia; John Gibson
  10. Why it Matters Who Runs the IMF and the World Bank-Updated October 2003 By Nancy Birdsall
  11. A Comparative Analysis of Trade Facilitation in Selected Regional and Bilateral Trade Agreement By Institute for International Business, Economics and Law
  12. International Exchange Rate Systems - Where do we Stand? By Horst Siebert
  13. Non-Preferential Trading Clubs By Raimondos-Møller, Pascalis; Woodland , Alan D.
  14. The Relationship between Liberalisation in the Logistics Sector and Trade Facilitation By Institute for International Business, Economics and Law
  15. Water Policy Briefing: Breaking the Cycles of Land Degradation: A case study from Ban Lak Sip, Laos By International Water Management Institute
  16. Why Hasn’t Economic Growth Killed Religion? By Michael McBride

  1. By: International Water Management Institute (International Water Management Institute)
    Keywords: water resource management / groundwater / institutional development / water policy / water resources development / case studies / water shortage / river basins / water conservation / irrigation management / water law / drinking water / cost recovery / water pollution / national planning / Asia / China/ Indonesia / Philippines / Sri Lanka / Thailand /
    Date: 2006
  2. By: Shunli Yao (Beijing Agricultural Trade Policy Dialogue)
    Abstract: China's early industrialization created distortions.This paper identifies major distortions in the Chinese economy in the pre-reform era and brings agricultural distortions into perspective.
    Keywords: Agricultural Reform,China, Liberalization,WTO, FTA
    JEL: F1
    Date: 2006–06
  3. By: Satoshi Shimizutani; Izumi Yokoyama
    Abstract: What happened to the traditional, long-term employment practices in Japan after the 1990s has remained unexplored. We take advantage of a micro data set from the Basic Survey on Wage Structure to provide new evidence regarding the years of tenure for Japanese male workers after a decade-long recession. While the practice of long-term employment is still alive among the workers who are already in the system, the proportion of workers who are not covered by the system has increased. These ongoing phenomena contribute to the bipolarization in the Japanese labor market.
    Keywords: long-term employment practice, Japan, Oaxaca-Blinder decomposition, DiNardo-Fortin-Lemieux decomposition
    JEL: J41 J82
    Date: 2006–08
  4. By: Edsel L. Beja, Jr.
    Abstract: The paper revisits hypothesized direct linkages between external borrowing and capital flight. It reviews the cases of Indonesia, Malaysia, the Philippines and Thailand to see if such linkages exist. The results indicate that, indeed, large sums of capital flowed in and out of these four countries in a revolving door process. Thus, the results lend support to the need for: better domestic management of external debt, sound macroeconomic management and solid macro-organizational foundations (with the government at the centre of policy making), active management of capital flows, and effective domestic and international involvement and coordination in capital flows.
    Keywords: capital flight, external debt, revolving door, Southeast Asia
    JEL: F20 F30 O57
    Date: 2006–08
  5. By: Kozo Kiyota; Miho Takizawa
    Abstract: This paper examines the pre-exit productivity performance and asks how productivity affects future survival, controlling for firm size and unobserved firm heterogeneity. Based on firm-level data in Japan for 1995–2002, we found that firms did not face "sudden death" but there was a "shadow of death." Future exiting firms had lower performance five years before their exit. Moreover, unobserved firm heterogeneity had a statistically significant effect on firm survival analysis. However, we also found that the effects of unobserved heterogeneity were not very large and thus did not reverse the conclusion.
    Date: 2006–08
  6. By: Junmin Wan (Osaka University)
    Abstract: We examine the validity of a new system of taxation called lottery receipts in China theoretically and empirically. Tax collection is difficult as the government difficultly monitors the actual economic dealings. To bring out the private information on transaction known only to a seller and a buyer, the government has set up a lottery receipt system which has been tried out in many areas. If the net revenue from a lottery receipt is invested in pure public goods, the lottery receipt will been purchased even if the consumer has expected quasi-linear utility. By issuing a lottery receipt, the government may prevent tax evasion caused by conspiracies between consumers and firms and collect tax effectively. Estimation is performed based on panel data for different periods from a total of 37 districts in Beijing and Tianjin during 1998-2003. The lottery receipt experiment has significantly raised the business tax, the growths of business tax and total tax revenues.
    Keywords: tax evasion, business tax, lottery receipt experiment, random trend (growth) model
    JEL: H26 D81 D82
    Date: 2006–09
  7. By: Ryo Kambayashi; Daiji Kawaguchi; Izumi Yokoyama
    Abstract: Diverging economic inequality has become a common focus of economic debate in developed countries. In particular, the recent experience of Japan has started attracting international attention. We take advantage of a rich micro-level data set from the Basic Survey on Wage Structure (1989-2003) to perform an in-depth analysis of the change in the inequality and distribution of the hourly wage. We observe that lower returns to education and years of tenure contribute to diminishing income disparity between groups for both sexes. A larger variance within a group contributes to the wage disparity for males, while an increased heterogeneity of workers' attributes contributes to the wage disparity for females. The Dinardo, Fortin, and Lemieux decomposition also confirms the basic findings from a parametric variance decomposition.
    Keywords: Wage Distribution, Wage Equation, Variance Decomposition
    JEL: J31
    Date: 2006–08
  8. By: Yann Duval (United Nations Economic and Social Commission for Asia and the Pacific)
    Abstract: This paper presents the findings and results of an exploratory ARTNeT study on the needs for and costs of implementation of selected trade facilitation measures (TFMs) related to GATT Articles V, VIII and X. This summary paper is based on six ARTNeT working papers issued between January and April 2006, including five country case studies (available at
    Keywords: WTO, Trade Facilitation,GATT Articles V,VIII and X
    JEL: F1
    Date: 2006–06
  9. By: Susan Olivia (University of California, Davis); John Gibson (University of Waikato)
    Abstract: The proper design of price interventions in energy markets requires consideration of equity and efficiency effects. In this paper, budget survey data from 29,000 Indonesian households are used to estimate a demand system for five energy sources, which is identified by the spatial variation in unit values (expenditures divided by quantities). We correct for the various quality and measurement error biases that result when unit values are used as proxies for market prices. The price elasticities are combined with tax and subsidy rates to calculate the marginal social cost of price changes for each item. The results suggest that even with high levels of inequality aversion there is a case for reducing the large subsidies on kerosene in Indonesia, supporting the reforms that have been announced recently.
    Keywords: demand elasticities; energy; subsidies; unit values
    JEL: D12 Q31
    Date: 2006–08–01
  10. By: Nancy Birdsall
    Abstract: Increasing integration has made the great challenge of reducing poverty and advancing human development more achievable than ever, and more dependent than ever on good global economic governance. In this paper I set out the economic logic for why good global economic governance matters for reducing poverty and inequality in the world, and then develop several arguments for how better representation of developing countries in the IMF, the World Bank, and other multilateral institutions would make those institutions more effective in that task. The arguments include the long-run viability of new financing of the institutions, and their effectiveness in managing the political economy challenges of using conditionality. To illustrate the possible link between better representation and effectiveness, I discuss the example of the Inter-American Development Bank, where the developing country borrowers control 50 percent of the votes and the Presidency. I close with a discussion of the dilemma of reconciling the need for sustaining the financial and political support of the rich country members of these global institutions, with stronger poor country representation to ensure their long-run legitimacy and effectiveness.
    Keywords: multilateral organizations, integration, poverty, human development
    JEL: F35 I32 I31 F36 O15 O19 O40 F53 D63
  11. By: Institute for International Business, Economics and Law (Institute for International Business, Economics and Law)
    Abstract: This study compared the treatment of trade facilitation in four selected regional trade agreements, AFTA, APEC, SAFRA and PACER, and in one bilateral free trade agreement being the Australia-Singapore Free Trade Agreement (ASFTA), with a view to determining model trade facilitation principles and measures which may be instructive for developing country negotiations and policy makers.
    Keywords: Liberalisation, Logistics Sector, Trade Facilitation, AFTA, APEC, SAFTA, PACER, ASFTA
    JEL: F1
    Date: 2006–08
  12. By: Horst Siebert
    Abstract: This paper analyzes institutional arrangements for exchange rate systems and reviews what we know. It looks at the foreign exchange market, different balance of payment situations in which countries find themselves and the necessary exchange rate adjustments. It studies the options that are available to countries in choosing their exchange rate system (type of nominal anchor, nominal anchor versus real target and the degree of sovereignty to be given up) and reviews the historical experience for multilateral options. The actual system is a fragile low-inflation central bank dominated arrangement. Options for the future rest on quite a few idealistic ideas. In addition to choosing the exchange rate system, adopting the right exchange rate is also addressed.
    Keywords: Exchange rate systems, Balance of payments situations, External and internal equilibrium, Choosing the exchange rate system, Unilateral and multilateral arrangements, Options for the future, Universal money
    JEL: E E5 E42 E58 E61 F31 F32 F33
    Date: 2006–08
  13. By: Raimondos-Møller, Pascalis (Department of Economics, Copenhagen Business School); Woodland , Alan D. (Department of Economics, Copenhagen Business School)
    Abstract: This paper examines the welfare implications of non-discriminatory tariff reforms by a subset of countries, which we term a non-preferential trading club. We show that there exist coordinated tariff reforms, accompanied by appropriate income transfers between the member countries, that unambiguously increase the welfare of these countries while leaving the welfare of non-members unaltered. In terms of economic policy implications, our results show that there exist regional, MFN-consistent arrangements that lead to Pareto improvements in world welfare.
    Keywords: Trading clubs; non-preferential tariff reform; Kemp-Wan-Ohyama proposition
    JEL: F15
    Date: 2006–08–28
  14. By: Institute for International Business, Economics and Law (Institute for International Business, Economics and Law)
    Abstract: This study demonstrates that the improvement of the performance of logistics services through domestic liberalisation may generate a virtuour cycle, whereby international trade is increased and the this, in turn, may increase the deman for logistics services.
    Keywords: Liberalisation, Logistics Sector, Trade Facilitation
    JEL: F1
    Date: 2006–08
  15. By: International Water Management Institute (International Water Management Institute)
    Keywords: water resource management / water policy / water resources development / land development / land management / land degradation /
    Date: 2005
  16. By: Michael McBride (Department of Economics, University of California-Irvine)
    Abstract: Economic growth has not led to a decline in religion despite past predictions that it would. I use a formal model of religious competition to show how economic growth produces counteracting effects on religious participation in an open religious market, while economic growth will have little effect in a religious market that is already secularized due to religious regulations. Theories predicting the decline of religion due to rising opportunity costs of religious demand and supply ignore countervailing influences.
    Keywords: Religion; Hotelling, entry deterrence
    JEL: D23 D40 L10 Z12
    Date: 2005–08

This nep-sea issue is ©2006 by Kavita Iyengar. It is provided as is without any express or implied warranty. It may be freely redistributed in whole or in part for any purpose. If distributed in part, please include this notice.
General information on the NEP project can be found at For comments please write to the director of NEP, Marco Novarese at <>. Put “NEP” in the subject, otherwise your mail may be rejected.
NEP’s infrastructure is sponsored by the School of Economics and Finance of Massey University in New Zealand.