nep-sea New Economics Papers
on South East Asia
Issue of 2009‒01‒10
seven papers chosen by
Kavita Iyengar
Asian Development Bank

  1. Democracy and Human Rights in the European-Asian Dialogue: A Clash of Cooperation Cultures? By Howard Loewen
  2. Vulnerability of Urban Informal Sector: Street Vendors in Yogyakarta, Indonesia By Aloysius Gunadi, Brata
  3. Hot money and economic performance: An empirical analysis By Duasa, Jarita; Kassim, Salina
  4. Creating New Regions, Improving Regional Welfare Equality? By Aloysius Gunadi, Brata
  7. Da Impresa Radicata nel Territorio a Rete Globale. La Ristrutturazione del Gruppo Benetton By Tattara, Giuseppe; Crestanello, Paolo

  1. By: Howard Loewen (GIGA Institute of Asian Studies)
    Abstract: Whereas the European Union (EU) favors a formal, binding, output-oriented, and to some extent supranational approach to cooperation, the Association of Southeast Asian Nations (ASEAN) is based on informal, non-binding, process-oriented intergovernmental forms of cooperation. This article addresses the question of whether these differences between European and Asian cooperation norms or cultures can account for interregional cooperation problems in the areas of democracy and human rights within the institutional context of EU-ASEAN and the Asia-Europe Meeting (ASEM). The author argues that a clash of cooperation cultures basically occurs in both forms of interregional collaboration between Asia and Europe, with slight differences due to the institutional context: while disagreements over the question of democracy and human rights between the EU and ASEAN have led to a temporary and then a complete standstill in cooperation, the flexible institutional mechanisms of ASEM seem, at first glance, to mitigate the disruptive effects of such dialogues. Yet informality does not remove the issues from the agenda, as the recurrent disputes over Myanmar’s participation and the nonintervention norm favored by the Asian side of ASEM clearly indicate. Antagonistic cooperation cultures thus play a significant role in explaining the obstructive nature of the interregional human rights and democracy dialogue between Asia and Europe.
    Keywords: cooperation culture, human rights, democracy, Myanmar, EU-ASEAN, ASEM
    Date: 2008–12
  2. By: Aloysius Gunadi, Brata
    Abstract: This study has been focusing on the vulnerability of street vendors in Java since the time when Java was hit severely by the economic crisis in 1997/1998, which also had reversed the trend of economic formalization in Indonesia. For this aim, a survey was conducted during the month of February 2007 in Yogyakarta and Sleman districts in Yogyakarta Special Province. The survey covered 122 street vendors in several streets in both areas. These samples consist of three groups of street vendors: food seller, non-food seller, and services providers. Based on this survey, vulnerability index of street vendors is measured. The study found that most of street vendors in Yogyakarta experience vulnerability at the medium level. In general, vulnerability of food seller vendors is higher than other vendors. Vulnerability also varies across the locations of vending.
    Keywords: informal sector; street vendor; vulnerability; Indonesia
    JEL: O17 R0
    Date: 2008–12
  3. By: Duasa, Jarita; Kassim, Salina
    Abstract: The present study empirically examines the importance of foreign portfolio investment (FPI) or hot money from certain investor(s) or country(s) on Malaysian economic performance. In methodology, the study uses vector error correction (VECM) model of FPI inflows from major investors such as the United States, United Kingdom, Singapore and Hong Kong and Malaysian real GDP using quarterly data covering the period of Q1:1991 to Q3:2007. For further inferences, the study adopts an innovation accounting by simulating variance decompositions (VDC) and impulse response functions (IRF). It is found that the country’s GDP is highly attributable to UK FPI inflow especially in the long run.
    Keywords: Foreign portfolio investment; Economic performance; VECM; Impulse Response; Variance Decomposition
    JEL: C32 F32 G15 C12
    Date: 2008–12
  4. By: Aloysius Gunadi, Brata
    Abstract: In concurrent with reformation and decentralization, number of sub-national administrative in Indonesia increase significantly. Existing regions has been splitting to create new regions. As the result, number of municipalities and districts in Indonesia in recent years are more than 450. The creation of new regions has been expected will increase citizens’ welfare in the regions and reduce regional inequality. However, indicative evidences shows negative impacts of this reform such as increase of inefficient administration cost of government, decrease capacity to deliver public services and increase potential for inter-group conflict. All of these indicative evidences will affect the welfare of citizens as seen on the human development indicators. Based on this background, the aim of this article is to analyze the relation of creation of new regions with the evolution of regional welfare inequality. The study employed human development index (HDI) at sub-national level (kota/kabupaten) as the indicator of welfare. The evolution of regional inequality of the HDI is analyzed by comparing coefficient of variation in the HDI from 1996 to 2005. This paper also estimated a preliminary empirical model to assess the impact of pemekaran on the within province inequality. The policy implication of this finding is that pemekaran should be controlled.
    Keywords: new region; ‘pemekaran’; human development index; inequality
    JEL: R58 H75 R11
    Date: 2008–10
  5. By: Kang, Hyunsoo; Kennedy, P. Lynn; Hilbun, Brian
    Abstract: This analysis presents the determination of an import demand function for the world rice market using annual data from 1994 to 2007. In the specification and analysis of a world rice market import demand function, Ordinary Least Square (OLS), Instrumental Variables (IV) with Generalized Method of Moments (GMM), and Seemingly Unrelated Regression (SUR) methods have been used. Social welfare effects have been obtained using consumer surplus and compensated variation for the top four rice importing countries (Indonesia, Philippines, Nigeria, and Saudi Arabia). Empirical results suggest that economic growth, Foreign Direct Investment (FDI), and importing countries’ population positively affect national income, thus, positively affecting rice consumption. Oil price has a strong effect on the domestic rice prices in importing countries. This paper also estimates the social effects arising from increased rice export prices and examines how consumer surplus is affected in major rice importing countries.
    Keywords: rice export and import, consumer surplus, trade, import demand function, International Relations/Trade,
    Date: 2009–01
  6. By: Kang, Hyunsoo; Kennedy, P. Lynn; Hilbun, Brian
    Abstract: This paper aims to (1) analyze the relationship between rice exports and economic growth for the world’s top four exporting countries (Thailand, Vietnam, India, and the U.S) and (2) seek to determine to what extent market power affects a country’s economic growth. The main objective of this paper is to determine to what extent economic growth impacts a country’s rice exports as well as to what extent Foreign Direct Investment (FDI) impacts a country’s ability to export rice. This analysis also examines the impact of market power on economic growth. On the basis of these results, we examine the existence of market power in the international rice market with respect to rice supply, and moreover, propose that there is a bi-directional causality between the international rice trade and economic growth for major rice exporting countries.
    Keywords: rice export, CR4, GDP, FDI, market power, trade, export supply function, Community/Rural/Urban Development, International Relations/Trade,
    Date: 2009–01
  7. By: Tattara, Giuseppe; Crestanello, Paolo
    Abstract: This paper investigates the strategy changes of the Benetton Group who have been facing severe intense competition in the international fashion market since the mid nine-ties. New competitors, in particular the European brands Zara, Mango and H&M, have challenged the Benetton position in the Italian and European clothing market, pushing the Group from Ponzano towards adopting politics of cost reduction through globalisation of its suppliers. Benetton has always been considered a vertically integrated producer which controls (in different ways) the whole value chain from textile raw materials to consumer sales. Until 2000, Benetton produced its goods in its own factories and through a vast network of national sub-contractors mainly specialising in the sewing phase. Today, Benetton has drastically changed its strategy, almost completely abandoning Italy with a chain of value organised around a dual supply chain: fast productions are delegated to closer locations (Eastern Europe and Northern Africa) while locations further afield are commissioned for more standardised products and accessories (Asia). This article also discusses the impact these choices of productive de-localisation abroad have made on the Treviso apparel district, where Benetton's traditional subcontractors have been drastically curtailed. Benetton restructuring marks the transition to a new net-work of competences between agents.
    Keywords: Global value chains; Benetton; Apparel; Clothing; District
    JEL: F16 L67 L23 F14 L22
    Date: 2008–11–01

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