nep-sea New Economics Papers
on South East Asia
Issue of 2007‒10‒27
ten papers chosen by
Kavita Iyengar
Asian Development Bank

  1. Fisher hypothesis: East Asian evidence from panel unit root tests By Ling, Tai-Hu; Liew, Venus Khim-Sen; Syed Khalid Wafa, Syed Azizi Wafa
  2. An Empirical Analysis of the Thai and Major International Stock Markets By Chancharat,Surachai; Valadkhani, Abbas
  3. Thailand’s Economic Cooperation with Neighboring Countries and Its Effects on Economic Development within Thailand By Tsuneishi, Takao
  4. Indonesian Higher Education: The Chronicle, Recent Development and The New Legal Entity Universities By Mohamad Fahmi
  5. Network Economics and the Digital Divide in Rural South Asia By Jake Kendall; Nirvikar Singh; Kristin Williams; Yan Zhou; P.D. Kaushik
  6. Equity on Access of Low SES Group in the Massification of Higher Education in Indonesia By Mohamad Fahmi
  7. Foreign Direct Investment and Economic Growth: Empirical Evidence from Sectoral Data in Indonesia By Abdul Khaliq; Ilan Noy
  8. Trade, Foreign Investment and Myanmar’s Economic Development during the Transition to an Open Economy By Kudo, Toshihiro; Mieno, Fumiharu
  9. Demographic Change and the Structure of Wages: A Demand-Theoretic Analysis for Brazil By Ernesto F. L. Amaral; Daniel S. Hamermesh; Joseph E. Potter; Eduardo L.G. Rios-Neto
  10. L'Asie Orientale sur la voie d'une "reconnexion régionalisée" ? By Catherine Figuière; Laëtitia Guilhot; Jean-Christophe Simon

  1. By: Ling, Tai-Hu; Liew, Venus Khim-Sen; Syed Khalid Wafa, Syed Azizi Wafa
    Abstract: This study provides evidence supportive of Fisher hypothesis in East Asian economies using panel unit root tests, which allow for cross-country variations in the estimation. Among others, one important implication is that monetary policy will be more effective in influencing long-term interest rates and long-run macroeconomic stability in these East Asian economies under regional collaboration.
    Keywords: Fisher hypothesis; panel unit root; univariate unit root; East Asian
    JEL: G10 E4
    Date: 2007–10–25
  2. By: Chancharat,Surachai (University of Wollongong); Valadkhani, Abbas (University of Wollongong)
    Abstract: This paper investigates the existence of cointegration and causality between the stock market price indices of Thailand and its major trading partners (Australia, Hong Kong, Indonesia, Japan, Korea, Malaysia, the Philippines, Singapore, Taiwan, the UK and the US), using monthly data spanning December 1987 to December 2005. Both the Engle- Granger two-step procedure (assuming no structural breaks) and the Gregory and Hansen (1996) test (allowing for one structural break) provide no evidence of a long-run relationship between the stock prices of Thailand and these countries. Based on the empirical results obtained from these two residual-based cointegration tests, potential long-run benefits exist from diversifying the investment portfolios internationally to reduce the associated systematic risks across countries. However, in the short run, three unidirectional Granger causalities run from the stock returns of Hong Kong, the Philippines and the UK to those of Thailand, pair-wise. Furthermore, there are two unidirectional causalities running from the stock returns of Thailand to those of Indonesia and the US. We also found empirical evidence of bidirectional Granger causality, suggesting that the stock returns of Thailand and three of its neighbouring countries (Malaysia, Singapore and Taiwan) are interrelated. No previous study examines the possibility that the pair-wise long-run relationship between the stock prices of Thailand and those of both emerging and developed markets may have been subject to a structural break.
    Keywords: Stock markets, Cointegration, Structural breaks, Thailand
    JEL: J40 E66 J21 J40 J53
    Date: 2007
  3. By: Tsuneishi, Takao
    Abstract: Thailand’s economic cooperation with neighboring countries, including not only trade and investment but also economic assistance, is tied inseparably to regional development within Thailand. Assistance to develop infrastructure along economic corridors, for example, promotes Thai regional development. This study examines the trade and investment relationships between Thailand and its neighboring countries, as well as related economic policies of Thailand. The study also examines the type of economic assistance being extended, and the resulting regional development taking place. And lastly, the study considers policies for further cooperation by Thailand and the implications this has for Japanese economic cooperation.
    Keywords: GMS (Greater Mekong Subregion), ACMECS (Ayeyarwady-Chao Phraya-Mekong Economic Cooperation Strategy), Eonomic corridors, Border economic zones, Border trade, Thailand, Southeast Asia, Regional economic cooperation, Economic assistance, Economic development, International trade
    JEL: O53 R11
    Date: 2007–08
  4. By: Mohamad Fahmi (Department of Economics, Padjadjaran University)
    Abstract: This paper reviews and presents the concise history of higher education Indonesia from pra-colonial period to the latest era when the Government of Republic Indonesia proposed the Educational Legal Entity Bill and the Law on National Education System.
    Keywords: higher education; Indonesia; history, legal entity
    JEL: I21 I28
    Date: 2007–10
  5. By: Jake Kendall (University of California Santa Cruz); Nirvikar Singh (University of California Santa Cruz); Kristin Williams (University of California Santa Cruz); Yan Zhou (California State University, Sacramento); P.D. Kaushik (Rajiv Gandhi Institute of Contemporary Studies)
    Abstract: The concept of a ‘global digital divide’ is now common, and many cross-country studies of determinants of differences in computer and Internet penetration have been performed. The main conclusions and policy implications from these studies are relatively blunt - get richer, have more telephones, and regulate telecommunications better. In this paper, we examine an alternative approach to bridging the digital divide, through organizational innovations that provide low cost Internet access in developing countries, within the existing conditions of income levels, telecommunications infrastructure and regulatory environment. We use survey data from 500 individuals in three South Asian countries, Bangladesh, Nepal and Sri Lanka, to examine factors influencing patterns of computer and Internet use. These individuals were in situations where computer and Internet access has been provided by a developmental agency (government or non-government). We estimate logit and multinomial logit models, using explanatory variables such as income, household size, education, and occupation, as well as infrastructure factors such as quality of electricity supply, and availability of telephones and televisions. Thus we are able to go beyond simple analyses of penetration at the country level, to understand the microeconomics of computer and Internet use in rural South Asia.
    Keywords: IT, ITC, Internet, South Asia, Development, Digital Divide
    JEL: L86 O1
    Date: 2007–09
  6. By: Mohamad Fahmi (Department of Economics, Padjadjaran University)
    Abstract: This paper discussed the e_ect of recent trend in higher education such as massification, the emergence role of private sector and cost sharing in higher education in Indonesia to the access of low SES group. Some evidence particularly from developing countries is reported to get a bigger picture about the problem of access in higher education in Indonesia.
    Keywords: higher education; access; Indonesia; developing countries
    JEL: I21 I22 I28
    Date: 2007–10
  7. By: Abdul Khaliq (Department of Economics, Andalas University, Indonesia); Ilan Noy (Department of Economics, University of Hawaii at Manoa)
    Abstract: The paper investigates the impact of foreign direct investment (FDI) on economic growth using detailed sectoral data for FDI inflows to Indonesia over the period 1997-2006. In the aggregate level, FDI is observed to have a positive effect on economic growth. However, when accounting for the different average growth performance across sectors, the beneficial impact of FDI is no longer apparent. When examining different impacts across sectors, estimation results show that the composition of FDI matters for its effect on economic growth with very few sectors showing positive impact of FDI and one sector even showing a robust negative impact of FDI inflows (mining and quarrying). The sectors examined are: farm food crops, livestock product, forestry, fishery, mining and quarrying, non-oil and gas industry, electricity, gas and water, construction, retail and wholesale trade, hotels and restaurant, transport and communications, and other private and services sectors.
    Keywords: Foreign direct investment, economic growth, Indonesia
    JEL: F21 F23
    Date: 2007–10–01
  8. By: Kudo, Toshihiro; Mieno, Fumiharu
    Abstract: Throughout the 1990s and up to 2005, the adoption of an open-door policy substantially increased the volume of Myanmar’s external trade. Imports grew more rapidly than exports in the 1990s owing to the release of pent-up consumer demand during the transition to a market economy. Accordingly, trade deficits expanded. Confronted by a shortage of foreign currency, the government after the late 1990s resorted to rigid controls over the private sector’s trade activities. Despite this tightening of policy, Myanmar’s external sector has improved since 2000 largely because of the emergence of new export commodities, namely garments and natural gas. Foreign direct investments in Myanmar significantly contributed to the exploration and development of new gas fields. As trade volume grew, Myanmar strengthened its trade relations with neighboring countries such as China, Thailand and India. Although the development of external trade and foreign investment inflows exerted a considerable impact on the Myanmar economy, the external sector has not yet begun to function as a vigorous engine for broad-based and sustainable development.
    Keywords: Myanmar (Burma), International trade, Cross-border trade, Foreign direct investment, Economic development, Development cooperation, Foreign investments
    JEL: F14 F21 P28
    Date: 2007–08
  9. By: Ernesto F. L. Amaral; Daniel S. Hamermesh; Joseph E. Potter; Eduardo L.G. Rios-Neto
    Abstract: With rapidly declining fertility and increased longevity the age structure of the labor force in developing countries has changed rapidly. Changing relative supply of workers by age group, and by educational attainment, can have profound effects on labor costs. Their impacts on earnings have been heavily studied in the United States but have received little attention in Asia and Latin America, where supply shocks are at least as large and have often proceeded less evenly across the economy. We use data on 502 local Brazilian labor markets from Censuses 1970-2000 to examine the extent of substitution among demographic groups as relative supply has changed. The results suggest that age-education groups are imperfect substitutes, so that larger age-education cohorts see depressed wage rates, particularly among more-educated groups. The extent of substitution has increased over time, so that the decreasing size of the least-skilled labor force today is barely raising its remaining members' wages.
    JEL: J23 O15
    Date: 2007–10
  10. By: Catherine Figuière (LEPII - Laboratoire d'Économie de la Production et de l'Intégration Internationale - CNRS : UMR5252 - Université Pierre Mendès-France - Grenoble II); Laëtitia Guilhot (LEPII - Laboratoire d'Économie de la Production et de l'Intégration Internationale - CNRS : UMR5252 - Université Pierre Mendès-France - Grenoble II); Jean-Christophe Simon (LEPII - Laboratoire d'Économie de la Production et de l'Intégration Internationale - CNRS : UMR5252 - Université Pierre Mendès-France - Grenoble II)
    Abstract: La problématique de la reconnexion Nord-Sud s'est appuyée sur l'analyse des phénomènes de décolonisation ainsi que sur les dynamiques des étapes de développement des jeunes Etats. Cet article propose donc de faire le point sur les caractéristiques, à la fois historiques et économiques, du processus particulier de reconnexion, dans l'espace de l'Asie Orientale. L'hypothèse défendue ici est que la base régionale de cette reconnexion, se renforce à partir de la crise asiatique de 1997. En effet, le cadre de l'ASEAN+3, bénéficiant d'un renforcement des flux intra-régionaux, initie une nouvelle coopération inter étatique.
    Keywords: intégration économique ; intégration régionale ; régionalisation ; crise économique ; relations économiques ; décolonisation ; coopération ; état ; Asie du Sud Est ; Chine ; Japon ; ASEAN
    Date: 2007

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