nep-sea New Economics Papers
on South East Asia
Issue of 2010‒03‒20
five papers chosen by
Kavita Iyengar
Asian Development Bank

  1. What is the Long Run Growth Rate of the East Asian Tigers? By B. Bhaskara Rao; Artur Tamazian; Rup Singh
  2. The Global Economic Crisis: An Opportunity for Strengthening Asia’s Social Protection Systems? By Mukul. G Asher
  3. Structural Estimation of Variety Gains from Trade Integration in a Heterogeneous Firms Framework By Victor Rivas
  4. Educational attainment and selection into the labour market: The determinants of employment and earnings in Indonesia By Margherita Comola; Luiz de Mello
  5. The G20 Proposal on IMF Governance: Is there Progress? By Menkhoff, Lukas; Meyer, Reeno

  1. By: B. Bhaskara Rao; Artur Tamazian; Rup Singh
    Abstract: New panel data estimates for the four East Asian Tigers show that the contribution of total factor productivity (TFP) to growth is much higher than past estimates. An extended production function with learning by doing implies that TFP is about 3.5% and these countries will grow at this rate in the long run.
    Keywords: Asian Tigers, Systems Dynamic GMM, Growth Accounting, Factor Accumulation as Residual.
    JEL: O1 N1
    Date: 2010–01–04
  2. By: Mukul. G Asher
    Abstract: The current global economic crisis has led to greater prominence for the issue of strengthening social protection systems in Asia. This paper analyzes the key factors determining and the possible avenues for strengthening social protection systems in Asia. The choice of an appropriate combination of avenues depends on the public policy objectives, institutional, fiscal, and other capabilities. [ADBI WP 198]
    Keywords: global economic crisis, social security systems, social protection systems, social security, Asia, public policy, fiscal policy, institutional capabilities, international financial systems
    Date: 2010
  3. By: Victor Rivas
    Abstract: The present paper structurally estimates the impact of increased variety in the EU and Asia over the period from 1989 to 2009. Using the most disaggregated import data available, we document that the number of varieties imported by the EU, defined as the number of import categories multiplied by the average number of source countries for each category, quadrupled, whereas it sextupled in Asia. About half of this increase was due to increases in the number of categories and half due to a doubling of the number of countries from which the EU and Asia imported each good. Using the Feenstra's (1994) methodology we estimate 35,000 elasticities and then construct an aggregate price index that is robust to common changes in quality variation, the arbitrary splitting of categories, the introduction of new goods, and other data problems. After reconstructing the EU and Asia import price indices, we found that the price of the EU imports has been falling at a rate 1.24 percent per year faster than one would have thought without taking new varieties into account. The variety gains for Asia are even higher - 2.69 percent per year.
    Keywords: Variety gains, structural estimation, trade integration, heterogenous firms.
    JEL: C68 F12 F14 F15 F17 R12 R13 R23
    Date: 2010–01–02
  4. By: Margherita Comola; Luiz de Mello
    Abstract: This paper uses household survey (Sakernas) data from 2004 to estimate the determinants of earnings in Indonesia, a country where non-salaried work is widespread and where earnings data are available for salaried employees only. We deal with the selection bias by estimating a full-information maximum likelihood system of equations, where earnings are observed for salaried employees, and selection into the labour market is modelled in a multinomial setting. We also deal with reverse causality between educational attainment and earnings by instrumenting years of schooling in both the multinomial selection and the earnings equations. Our identification strategy, following Duflo (2001), uses information on exposure to a large-scale school construction programme implemented in the 1970s. Duflo recognizes that schooling may affect an individual's probability of working as a salaried employee, which creates a simultaneity bias, but does not directly deal with this issue. We find that the parameters of the earnings equation estimated under multinomial selection differ from standard OLS estimates, which ignore the selection bias, and from a binomial selection procedure "à la Heckman" (1979). In particular, the estimated parameters that vary the most are those related to the variables with the strongest impact on individual selection into the different labour-market statuses. We also find that workers with higher educational attainment are most likely to find a job as salaried employees, and that non-salaried work is as an alternative to inactivity.
    Date: 2010
  5. By: Menkhoff, Lukas; Meyer, Reeno
    Abstract: The G20 summits in 2009 have proposed major changes in governance of the International Monetary Fund (IMF). Most important seems to be the acknowledgment that the IMF in its current form lacks legitimacy and ownership. Accordingly, the G20 suggests a reallocation of voting shares to emerging and developing countries, an antedated reform of the quota system, a delinking of the managing director's election from regional origin and support for the Singapore quota and voice reform of 2006. Unfortunately, these reform decisions remain in part imprecise, they leave crucial issues untouched and they are not implemented, not even by several G20 countries themselves. So the intended reform takes the right direction but it must be implemented soon before any progress can be stated.
    Keywords: International Monetary Fund, governance, reform, quota system
    JEL: F33
    Date: 2010–03

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