nep-sea New Economics Papers
on South East Asia
Issue of 2007‒04‒14
eight papers chosen by
Kavita Iyengar
Asian Development Bank

  1. Stock Market Liberalisations in the South Asian Region By Fazal Husain; Abdul Qayyum
  2. The Evolution of the “One China†Concept in the Process of Taiwan’s Democratization By Matsumoto I., Haruka
  3. Does Foreign Direct Investment Have Impacts on the Growth in Labor Productivity of Vietnamese Domestic Firms? By Le Thanh THUY
  4. VIP-room Contractual System of Macau’s Traditional Casino Industry By Wuyi Wang; William R. Eadington
  5. Impact of Mobile Usage on the Interpersonal Relations By Kim, AeRee; Mitomo, Hitoshi
  6. Voluntary Environmental Regulation in Developing Countries: Fad or Fix? By Blackman, Allen
  7. Crises and Growth: A Latin American Perspective By Sebastian Edwards
  8. Sources of Regional Income Disparity in Rural Vietnam: Oaxaca-Blinder Decomposition By Takahashi, Kazushi

  1. By: Fazal Husain (Pakistan Institute of Development Economics, Islamabad); Abdul Qayyum (Pakistan Institute of Development Economics, Islamabad)
    Abstract: This study attempts to conduct an investigation of the characteristics of the South Asian stock markets including the effects of the opening of these markets. These markets were liberalised in early 1990s as a part of the economic reforms started in the South Asian region about two decades ago. The analysis is conducted for four countries in the South Asia, Bangladesh, India, Pakistan, and Sri Lanka, covering the period from 1980 to 2003. The analysis is done with the help of tables, regression analysis, Event Window analysis, and Error Correction Functions. The analysis indicates significant development in stock markets indicators such as market capitalisation and trading value in the region following liberalisation measures. However, the development in stock markets in South Asia does not seem to influence the real sector and the stock markets are still playing a minor role in their respective economies. The integration analysis suggests that the markets in South Asia are integrated with major markets, that is, of USA, UK, and Japan. There is clear evidence that the markets in India and Pakistan are affected by the major as well as the regional markets in the long run. In the short run, however, the markets appear to be independent of one another
    Keywords: Stock Markets, South Asia, Liberalisation, Pakistan, India, Sri Lanka, Bangladesh, Market Integration
    JEL: G1
    Date: 2006
  2. By: Matsumoto I., Haruka
    Abstract: This paper investigates how Taiwan’s “one China†concept evolved during the democratization process that occurred under the leadership of former President Lee Teng-hui. The author argues that there was a crucial evolution of the “one China†concept and that the transformation of the concept resulted from changes in Taiwan’s internal political circumstances. The evolution of the concept creates a real possibility that the “status quo†sought by the ROC in the Taiwan Strait both during and after the Cold War might be destroyed. In addition, any further evolution of the “one China†concept will surely make the “status quo†of Taiwan untenable, in that it would induce Taiwan to seek de jure instead of de facto independence, possibly initiating a conflict between the PRC and the ROC. To prevent such a conflict in the Taiwan Strait, the international community must persuade the ROC not to go beyond the “status quo†and to stay within the framework of de facto independence. At the same time, both the PRC and the ROC should be urged to maintain an open conduit of communication for productive talks on the reunification of China.
    Keywords: One China, PRC, ROC, Taiwan, China, Democratization, Lee Teng-hui, Foreign relations, Foreign policy, 1
    Date: 2007–03
  3. By: Le Thanh THUY
    Abstract: Foreign Direct Investment has been considered a very important factor in the growth of recent Vietnam's economy and so far it has drawn a lot of concerns of economic researches in Vietnam. However, studies on the impacts of Foreign Direct Investment on Vietnam's economy, especially the technological spillovers are still very scarce compared with other developing countries. This study makes an attempt to figure out the main channels and estimate the degree of Spillover effects in Vietnam using industry level data for 1995-1999 and 2000-2002 periods. The linkage between foreign investors and domestic private sectors is found to play an important role for technological spillovers from Foreign Direct Investment in Vietnam.
    Date: 2007–04
  4. By: Wuyi Wang (Macau Polytechnic Institute); William R. Eadington (Department of Economics, University of Nevada, Reno)
    Abstract: This study provides a systematic analysis of the VIP-room contractual system of Macau’s traditional casino industry. It examines the system’s historical background, its organizational structure, its operational mechanisms, and its role in Macau’s casino industry. This analysis examines the evolving and likely future changes in the VIP-room sector—as well as the mass market sector—caused by the liberalization of Macau’s gaming laws in 2001 and the Free Individual Travelers Scheme, introduced by the Chinese government in 2003. This study develops a framework to explain how the two sectors’ market shares are determined by examining the economic and cultural forces at work. The existing structure of the VIP-room contractual system in Macau’s casino industry will not likely continue in its traditional way, and will be replaced by newly evolving systems consistent with the new competitive realities. However, the VIP business will likely continue in one form or another.
    Keywords: Regulation, gambling, casinos, Macau, baccarat
    JEL: L13 L51 L83
    Date: 2007–01
  5. By: Kim, AeRee; Mitomo, Hitoshi
    Abstract: Communication via mobile telephones is widespread in East Asian metropolis such as Seoul, Taipei and Tokyo. In the last ten years, the number of mobile telephone users has increased dramatically, with the younger generation in particular depending on the services available via mobile telephones. This paper explores the relationship between the voice and text messaging communications of these young consumers through their mobile telephones and their interpersonal relations. It analyses how mobile telephone usage affects relationships between respondents by comparing models of the cause-effect relationship of several latent factors in different environments, namely dependency on mobile telephone communication, perception of friendships, individual factors and IT literacy. By applying a covariance structure analysis, the correlations between latent and observable variables can be successfully visualized. The results show that mobile telephones have little influence on the perception of relationships among the younger generation, although somewhat different structures of interdependency exist in these metropolitan areas.
    Keywords: mobile telephone calls; text messaging; Seoul; Taipei; Tokyo; communication; younger generation; relationship and covariance structure analysis.
    JEL: L96 O33
    Date: 2006–03
  6. By: Blackman, Allen (Resources for the Future)
    Abstract: Hamstrung by weak institutions that undermine conventional environmental regulatory tools, policymakers in developing countries are increasingly turning to voluntary approaches. Yet the evaluative literature on the topic is thin. To help fill this gap, we review arguments for and against the use of voluntary regulation in developing countries and present three case studies: a series of agreements negotiated between regulators and leather tanners in Guanajuato, Mexico; a national environmental audit program in Mexico; and a national public disclosure program in Indonesia. Admittedly few in number, these case studies nevertheless suggest that although voluntary environmental regulation in developing countries is a risky endeavor, it is by no means doomed to failure. The risks can be minimized by emphasizing the dissemination of information about pollution and pollution abatement options and by avoiding voluntary tools in situations where regulatory and nonregulatory pressures for improved environmental performance are weak and where polluters can block quantified targets, individual sanctions for noncompliance, and other widely accepted prerequisites of effective initiatives.
    Keywords: voluntary regulation, environment, developing country, Mexico, Indonesia
    JEL: Q28 O13
    Date: 2007–03–16
  7. By: Sebastian Edwards
    Abstract: In this paper I use historical data to analyze the relationship between crises and growth in Latin America. I calculate by how much the region's GDP per capita has been reduced as a consequence of the recurrence of external crises. I also analyze the determinants of major balance of payments crises. The main conclusion is that it is unlikely that Latin America will, on average, experience a major improvement in long run growth in the future. It is possible that some countries will make progress in catching up with the advanced nations. This, however, will not be the norm; most Latin American countries are likely to fall further behind in relation to the Asian countries and other emerging nations. Not everything, however, is grim. My analysis also suggests that fewer Latin America countries will be subject to the type of catastrophic crises that affected the region in the past. Latin America's future will be one of "No crises and modest growth."
    JEL: F30 F32 N26 O4
    Date: 2007–04
  8. By: Takahashi, Kazushi
    Abstract: This paper investigates determinants of regional income disparity in rural Vietnam, with special emphasis placed on the roles of human capital and land. We apply a decomposition method, suggested by Oaxaca and Blinder. We found that returns to assets rather than endowments, especially those of human capital, are one of the leading factors to account for income differences across regions. We also found that substantial improvements of returns to human capital in the Red River delta region are a driving force to catch up with Mekong River delta region. Unexpectedly, differences in land endowment do not strongly correlate with regional income disparity because better access to land in a region was partially offset by lower returns.
    Keywords: Income inequality, Human capital, Land, Vietnam, Income distribution, Human resources
    JEL: D31 I32 O12
    Date: 2007–03

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