nep-sea New Economics Papers
on South East Asia
Issue of 2007‒03‒17
ten papers chosen by
Kavita Iyengar
Asian Development Bank

  1. Financial Integration of East Asian Economies: Evidence from Real Interest Parity By Baharumshah, Ahmad Zubaidi; Chan, Tze-Haw; Masih, A. Mansur A.
  2. Interdependence of Income between China and ASEAN-5 Countries By Lau, Evan; Lee, Koon Po
  3. A Comparative Study on Landownership between China and England By Deng, Feng
  4. Impact of Trade Costs on Trade: Empirical Evidence from Asian Countries By Prabir De
  5. Health-related Services in Multilateral and Preferential Trade Arrangements in Asia and the Pacific By Mia Mikic
  6. Foreign Direct Investment Development Policies in the Arab Countries By ALASRAG, HUSSIEN
  7. Earnings Differential Between Male-Female In Indonesia: Evidence From Sakernas Data By Viktor Pirmana
  8. The Impact of Child Labor on Child’s Education: The Case of Indonesia By Pipit Pitriyan
  9. Basic Strategies For The Role Of Indonesian Central-local Government In Poverty Alleviation Programs By Kodrat Wibowo
  10. Searching for Equitable Energy Price Reform for Indonesia By Arief Anshory Yusuf; Budy P. Resosudarmo

  1. By: Baharumshah, Ahmad Zubaidi; Chan, Tze-Haw; Masih, A. Mansur A.
    Abstract: In this paper, we investigate the financial linkages between the East Asian countries with Japan and the US using the real interest rate parity (RIP) condition. This study offers three important results: first, we find strong (robust) evidence that RIP condition holds in all the Asian countries, except for China. Based on SURADF tests, we conclude that South Korea and the ASEAN-5 countries are financially integrated with the global financial markets namely, Japan and the US. Second, we also confirmed the real interest rate differentials between Japan and the US exhibits strong tendency towards a stationary equilibrium. Third, the analysis drawn on half-life suggests that the US-Asian link has been getting stronger than the Japan-Asian one in post-liberalization era
    Keywords: RIP; panel unit root tests; half-lives
    JEL: F02 C33 F36
    Date: 2005
  2. By: Lau, Evan; Lee, Koon Po
    Abstract: This paper examines the interdependence of income between China and ASEAN-5 countries by resorting to the time series econometrics analysis from 1960 to 2000 of the real Gross Domestic Product (GDP). Empirical results are found to support the strong interdependence of income between China and ASEAN-5 countries. With the increasing interest of economic integration around the globe especially the proposed China-ASEAN Free Trade Area (CAFTA), the interdependence and synchronization movements of income between member countries is an important characteristic for suitability toward the regional common currency goal.
    Keywords: interdependence; cointegration; China; ASEAN-5
    JEL: R1 O18
    Date: 2007–03–12
  3. By: Deng, Feng
    Abstract: By comparing the development of landownership in China and England, this paper explores what were behind their different trajectories. In particular, I examined the delineation of property rights, alienation of land, rent and tax, inheritance and accumulation of land. Feudal England was a combination of the Roman system and Anglo-Saxon tradition. From that very strict hierarchical structure England has experienced an evolution toward free land market. In contrast, since very early China has established a unique economic system that allowed free alienation of land, but it has been trying to check the development of land market and private property rights by various means, the most important of which is the strengthening and expanding of patriarchal clan system. The different development paths of China and England show the different responses of two different cultures, which are oriented toward family and individual, respectively, to the same problems related to landownership.
    Keywords: landownership; property rights; culture; institutions; China; England
    JEL: Q15 D23 N95 P52 N50
    Date: 1996–12
  4. By: Prabir De (Research and Information System for Developing Countries)
    Abstract: Findings of this paper have important policy implications for Asian countries seeking to expand trade. Addressing rising auxiliary shipping charges as well as the overall rise in shipping costs may require serious consideration by regulators and policymakers that wish to further promote trade in Asia. In addition, if improvements in the quality of infrastructure in LDCs continue to lag behind those in more developed countries, their share in world trade is likely to decline.
    Keywords: Trade Facilitation, Trade Cost, Trade Liberalisation
    JEL: F1
    Date: 2007–01
  5. By: Mia Mikic (United Nations Economic and Social Commission for Asia and the Pacific)
    Abstract: In many developing countries, the health-care sector is under-developed, lacking basic infrastructure and human capital, and attracting little attention from investors and policymakers. While encouraging globalization and trade may aggravate those problems and create additional costs in some circumstances, trade liberalization and deeper integration into the global economy could also provide opportunities and resources to address those problems more effectively. This paper contributes to the debate by reporting on the status of liberalization achieved in the health services sector by members of ESCAP through their regional and multilateral trade liberalization commitments.
    Keywords: Health services trade, GATS, TRIPS, Preferential Trade Aggreeemetns, Modes of Services Delivery, ASEAN
    JEL: F13 F15 I19
    Date: 2007–01
    Abstract: In spite of many reforms have been taken to attract more FDI in the Arab countries, This countries still compare poorly with other developing countries, like Mexico, Brazil, Hong Kong and Singapore. This countries attracted US $ 10.78, 10.1, 13.56 and 11.41 billion respectively in year 2003.Meanwhile the Arab countries as a whole attracted US $ 8.6 billion or 5.01% of the total FDI in the developing countries and 1.54% of the total world FDI in 2003. Furthermore the total FDI flows in the Arab countries during 1992-2003 were smaller than the FDI flows in China (US $ 53.5 billion) in year 2003 only. On the other hand the investments between the Arab countries in the same period were very small since it reached US $ 20.7 billion or 44% of the total FDI flows in the Arab countries during (1995-2003).So the purpose of this paper is to review and analysis the Mechanisms for FDI Flows Motivation in The Arab Countries
    Keywords: Arab Countries; FDI in the Arab countries; FDI Flows Motivation in The Arab Countries
    JEL: F59 F3
    Date: 2005–12–01
  7. By: Viktor Pirmana (Department of Economics, Padjadjaran University)
    Abstract: This Research aims to analyze the earnings inequality in Indonesia and to know whether the earnings inequality can be explained by individual characteristic factors such as education and experience; location both urban-rural and province where individual reside and work; and based on socio-demography-economic characteristic. Furthermore, this research tries to know how big those factors contribute to the existing inequality, before and after crisis. Using data from SAKERNAS 1996, 1999, 2002, and 2004, the valid observation is about 145660 individual. Result of analysis clearly indicate that there are significant gender inequalities in earnings in Indonesia, based on education and experience; urban-rural location and province where individual reside and work and based on socio-demography-economic characteristic. The profile of earnings inequality by gender seems to be an “inverted U” fashion, with the male-female earnings gap narrowing as educational attainment went up, and reached a plateau at the “post-secondary level” and then tapered off. The analysis also suggests that the industrial affiliation of female workers matter.The result of estimating Mincerian earnings equation shows that such factor as human capital (years of schooling and experience); socio-demography-economic characteristic (being household’s head, gender, marriage status, work sector); and location factors (urban-rural and province which individual reside and work), significantly affects individual earning in Indonesia. Meanwhile, the result of decomposing this earnings inequality indicate that factor causing earnings inequality between “male” and “female” is about 41.6 percent caused by endowment differences. On the other hand, most of the gap about 58.4 percent attributed to unobserved and unexplained factors, rather than attributed to differences in observable endowments.
    Keywords: Earnings inequality, Decomposition analysis, SAKERNAS, Indonesia
    JEL: O15
    Date: 2006–08
  8. By: Pipit Pitriyan (Department of Economics, Padjadjaran University)
    Abstract: Employing child as a labor is categorized as a violation to the human right. But it seems unavoidable in developing country to prevent children entering labor market. Many extensive literatures on the determinant of child labor have been found, but yet, there is limited research on the impact of children work on socioeconomic outcomes. This paper investigates the impact of child labor on child’s education by using the Indonesian Labor Survey/SAKERNAS 2002 data at the district level.
    Keywords: Child Labor, Bivariate Probit, SAKERNAS, Indonesia
    JEL: I20
    Date: 2006–08
  9. By: Kodrat Wibowo (Department of Economics, Padjadjaran University)
    Abstract: One consequence of Indonesian fiscal decentralization and regional autonomy is that local governments now have more responsibility to more participate in poverty alleviation programs. Providing better access for local public goods and services is one possible action from local governments in national poverty alleviation programs. This paper tries to propose a basic strategy for the role of Indonesian central-local government in poverty alleviation program that may proper to be implemented within the framework of Indonesian new government system after fiscal decentralization and regional autonomy. One important strategy proposed is role sharing and role switching between central and local governments in designing and implementing market and public-oriented policies. Since the stronger-need participation of local government in poverty alleviation may put local government’s fiscal condition in problem, the objective of wealth-neutral condition does need an appropriate cost-sharing system that will lead to the more financial and political fairness between Indonesian central and local government.
    Keywords: poverty alleviation, decentralization, Indonesia
    JEL: H77 I39
    Date: 2005–04
  10. By: Arief Anshory Yusuf (Department of Economics, Padjadjaran University); Budy P. Resosudarmo (Australian National University)
    Abstract: Economic structure, households energy consumption pattern, and household's pattern of factor income in developing countries may typically be different with those of the developed countries, hence the distributional impact of energy price reforms could be. This may be portrayed using a Computable General Equilibrium (CGE) model with disaggregated households that allows for rich and accurate distributional story. Using this method, counter-factual scenarios analysis of recent energy price reform in Indonesia is carried out. The result suggests that vehicle fuels subsidy is regressive but increasing the price of domestic fuel (such as kerosene) tends to increase inequality, unless accompanied by a proper and effective compensation scheme. Distributional impact does depend on compensation scheme, its form and its effectiveness. Cash transfers to the poor with moderate ineffectiveness, for example, could not even prevent the increase in poverty nation-wide. Giving more cash to urban poor than to rural poor might have been better than a simple uniform cash transfers, due to urban poor's dependence on kerosene. The result also suggests that non-cash compensation, by subsidizing the poor's education and health spending may not be effective to mitigate the reform despite its desirability as longer-term poverty alleviation programs.
    Keywords: Energy price reform, Distribution, CGE, Indonesia
    JEL: D30 D50
    Date: 2007–01

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