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on South East Asia |
| By: | Chen-Min Hsu; Chih-Feng Liao (Asian Development Bank Institute) |
| Abstract: | This paper investigates the prevailing financial regulatory structures and impact of the current financial turmoil on banking performance in four Asian economies: the People's Republic of China (PRC); Hong Kong, China; Singapore; and Taipei,China. Both the PRC and Hong Kong, China operate under a fragmented financial regulatory structure, while Singapore and Taipei,China have integrated structures. We examine the role of an integrated financial regulatory structure in helping financial institutions mitigate the impact of the financial crisis, using financial indicators of banks’ capital structure and operating performance in these four economies between 2003 and 2008. Our analysis of the indicators reveals that banking performance under a fragmented financial regulatory structure is not worse than under integrated regulation. This implies that financial regulatory structure is not the main reason why Asian financial institutions suffered only limited losses from the current global financial crisis. However, given the growing complexity of the global financial system, and the relative weakness of current financial regulatory structures in Asia, this paper suggests that East Asian governments should refer to the Lamfalussy Process in the European Union and set up an Asia Financial Stability Dialogue to facilitate policy coordination for regional financial sector stability and development. |
| Keywords: | China, Hong Kong, Singapore, Taiwan, financial regulatory structures, banking, finance, Asia Financial Stability Dialogue |
| JEL: | F42 G18 G21 |
| Date: | 2010 |
| URL: | http://d.repec.org/n?u=RePEc:eab:financ:2287&r=sea |
| By: | Phu Huynh; Steven Kapsos; Kee Beom Kim; Gyorgy Sziraczki (Asian Development Bank Institute) |
| Abstract: | The paper investigates the labor market and social impacts of the global financial and economic crisis in Asia and the Pacific as well as national policy responses to the crisis. It draws on recent macroeconomic, trade, production, investment, and remittances data to assess the employment and social consequences of the crisis, including falling demand for labor, rising vulnerable and informal employment, and falling incomes and their related pressures on the working poor. The paper provides some projections of the impact on unemployment, vulnerable employment, working poverty, and labor productivity in the region in 2009. It demonstrates that labor market recovery is likely to lag behind output growth, based on the experience of Asian labor markets following the 1997 Asian financial crisis. The paper underscores some policy options that are likely to have positive outcomes toward generating employment and boosting aggregate demand, improving social protection and welfare on the basis of decent work principles, and promoting a sound and sustainable economic and labor market recovery. |
| Keywords: | labor market, financial crisis, unemployment, working poverty, labour productivity |
| JEL: | E24 I30 J08 J20 |
| Date: | 2010 |
| URL: | http://d.repec.org/n?u=RePEc:eab:laborw:2289&r=sea |
| By: | Peter Drysdale; Shiro Armstrong (East Asia Bureau of Economic Research) |
| Abstract: | Asia has emerged from the global financial crisis as an important stabilizing force and engine of global economic growth. The establishment of the G20 gives Asian economies the global forum that they have needed to both represent their interests in global governance and to deliver on responsibilities concomitant with their growing weight in the global economy. The region has a host of cooperation arrangements in APEC, ASEAN+3 and EAS, all with ASEAN as the fulcrum. They are huge assets but they need to be re-positioned to relate effectively to the G20 process and other global arrangements. They also need to comprehend the politics of the changing structure of regional power. This paper discusses the challenges that Asia faces in aligning regional and global objectives in financial, trade and other areas of cooperation, such as on climate change and on foreign investment. It argues that Asia is now a critical player in the global system and has a central contribution to make in strengthening global governance and international policy outcomes. Currently, there is a disconnect between the regional cooperation and the global agenda. The paper sets out ways to address this problem through filling gaps in regional cooperation and linking the agenda for regional cooperation more effectively to Asia's new role globally. That is essential to sustain Asia's superior growth performance, correct imbalances and support the global economic system. |
| Keywords: | economic integration; financial cooperation Asian economic cooperation; Asia Pacific community; global governance; trade policy; foreign investment regime; climate change |
| JEL: | F53 |
| Date: | 2010 |
| URL: | http://d.repec.org/n?u=RePEc:eab:wpaper:2188&r=sea |
| By: | Kaliappa Kalirajan; VenkatachalamAnbumozhi; Kanhaiya Singh (Asian Development Bank Institute) |
| Abstract: | It is an empirical fact that it is very difficult to balance economic growth, poverty reduction, and environment protection, particularly for developing and transitional economies. While the economic environment of a country is influenced by conditions within the country, it is also influenced by external shocks such as the recent global financial crisis depending on how integrated the country is with the rest of the world. Thus, it poses a continuing challenge for policy makers in developing and transitional countries to readjust the economic environment in a way that leads to better and more effective targeting of the chronic issue of poverty reduction without causing damage to the natural environment. It is in this context that this paper attempts to measure the environmental impact of changing trade patterns on the poor. The recent financial crisis has discouraged United States (US) private consumption, which in turn has significantly reduced exports from Asia. However, Asia’s private consumption is at a very low level even when compared with the current reduced US private consumption. Therefore, it is possible for Asian countries to focus more on improving regional trade and domestic consumption to compensate for the revenue losses that resulted from the reduction in global demand. This paper argues that energy-efficient production methods and service-led growth, particularly trade in environmental goods and services, provide good opportunities for Asian countries to enjoy “inclusive growth” without damaging the natural environment. |
| Keywords: | poverty reduction, environmental sustainability, trade, United States, Asia |
| JEL: | E20 Q43 Q56 |
| Date: | 2010 |
| URL: | http://d.repec.org/n?u=RePEc:eab:tradew:2290&r=sea |
| By: | Sung Teak Kim (Asian Development Bank Institute) |
| Abstract: | This paper analyzes the impacts of the 1998 and 2008 financial crises on the Korean labor market. We study the historical background of the Korean Employment Insurance System and the change of labor policies from the 1998 Asian financial crisis to the current 2008 global financial crisis. While it is arguable to say that the expansion of the social welfare system in the Republic of Korea is main source of difference between the two crises, it is certain that the social welfare system is one of the influential factors that helped overcome the problems of the global financial crisis. From an analysis of the Korean experience on the two financial crises, we can deduce the following. First, financial stability at the national level is important to stabilize employment. Second, countries need to develop a social welfare system ahead of any economic crisis. Third, layoffs should be the last resort to lowering labor costs, even at a time of recession. Finally, cooperation and coordination among government departments are crucial to overcome the crisis in labor market. |
| Keywords: | Asian financial crisis, Korea, labor market, Korean Employment Insurance System, global financial crisis, financial stability |
| JEL: | I30 I38 J65 J68 |
| Date: | 2010 |
| URL: | http://d.repec.org/n?u=RePEc:eab:financ:2292&r=sea |
| By: | Masahiro Kawai; Peter A. Petri (Asian Development Bank Institute) |
| Abstract: | The global economic and financial landscape has been transformed over the past decade by the growing economic size and financial power of emerging economies. The new G20 summit process, which includes the largest emerging economies, has established high-level international policy cooperation in this new setting. This paper argues that effective global economic governance will also require changes in key global organizations—such as the International Monetary Fund, World Bank, World Trade Organization, and the Financial Stability Board—and closer collaboration between global and regional organizations. We suggest that federalism be introduced on a global scale by creating hierarchies of global and regional organizations with overlapping ownership structures in various functional areas (as is already the case with the World Bank and regional development banks in the area of development finance). Asia could contribute to this transformation by building effective institutions to promote macroeconomic and financial stability and deepen regional trade and investment integration. |
| Keywords: | financial landscape, G20 summit process, global economic governance, Asia, financial stability |
| JEL: | F02 F13 F33 |
| Date: | 2010 |
| URL: | http://d.repec.org/n?u=RePEc:eab:govern:2291&r=sea |
| By: | Engel, Stefanie; Palmer, Charles; Pfaff, Alex |
| Abstract: | Protected areas may be established and maintained at the expense of local communities ('fences & fines'), although attempts to block local land use can be fruitless ('paper tigers'). Innovation in protected area policy has led to the involvement of communities in protected-area management ('co-management'). This paper aims to predict and study the emergence of such negotiated agreements to share the management of as well as the benefits from forest. First, we develop a conceptual framework for understanding roles of co-management interventions. Second, we bring to our derived hypotheses unique panel data collected from a co-management policy implemented in Lore Lindu National Park, Indonesia. The results broadly support our model predictions, although there is mixed evidence in some cases, possibly due to the fact that our relatively rough data proxies often correlate with several model parameters. -- |
| Keywords: | forest,protected area,park,community,property right,Indonesia |
| Date: | 2010 |
| URL: | http://d.repec.org/n?u=RePEc:zbw:gdec10:12&r=sea |
| By: | Yongfu Cao-Wendy Dobson-Yiping Huang; Peter A. Petri-Michael Plummer; Raimundo Soto; Shinji Takagi. |
| Abstract: | The recovery of the Asia-Pacific from the global economic crisis of 2008-09 is underway but incomplete. Despite encouraging progress, major risks remain, ranging from slow growth and persistent unemployment to reemerging global imbalances and renewed financial volatility. The policies that stopped the economic freefall—massive stimulus and financial bailout packages— were urgent, relatively easy to sell politically, and to a large extent forced by circumstances. This report argues that sustained recovery now requires tackling different problems, including international imbalances among the United States, China, and other economies. U.S. consumers are not likely to drive world demand in the medium term, and the slack will have to be taken up in part by Asian consumption and investment. The early policy responses, successful as they were in averting a larger calamity, were not designed to address longer-term issues, and some are even counterproductive from that perspective. |
| Keywords: | Economic crisis, macroeconomic policy, stabilization |
| JEL: | E63 R1 |
| Date: | 2010 |
| URL: | http://d.repec.org/n?u=RePEc:ioe:doctra:370&r=sea |
| By: | Hardeweg, Bernd; Wagener, Andreas; Waibel, Hermann |
| Abstract: | Several measures of vulnerability to poverty have been suggested in the literature. In practise, only little is known about the robustness of vulnerability comparisons based on these often quite specific measures. The theory of stochastic orders can be applied to shed some light on such issues. In the DFG research project "Impact of Shocks on the Vulnerability to Poverty: Consequences for Development of Emerging Southeast Asian Economies" (DFG FOR 756), an extensive panel survey was carried out in six rural provinces of Thailand and Vietnam in 2007. We establish cumulative distribution functions for income and consumption at the provincial level and search for stochastic dominance relations between these distributions. Our comparisons allow for initial, but quite robust conclusions on welfare and provide benchmarks for assessing the vulnerability to poverty in the research regions. -- |
| Keywords: | welfare distribution,stochastic ordering,vulnerability |
| JEL: | D31 I32 O15 |
| Date: | 2010 |
| URL: | http://d.repec.org/n?u=RePEc:zbw:gdec10:14&r=sea |
| By: | Manabu Fujimura; Ramesh Adhikari (Asian Development Bank Institute) |
| Abstract: | This paper attempts to fill gaps faced by policymakers and practitioners in the evaluation of cross-border infrastructure projects. It first defines what constitutes cross-border infrastructure projects, and then outlines an analytical framework and criteria to evaluate them. The criteria identify additionalities and externalities specific to cross-border infrastructure projects that need to be stressed in covering broader and indirect impacts that are not usually captured in the analysis of national projects. Then the paper examines to what extent the defined criteria are applicable in evaluating recent cross-border infrastructure projects. It also reports on emerging impacts patterns evidenced in relevant studies. The paper draws lessons and implications for design and implementation of cross- border infrastructure projects. |
| Keywords: | cross-border infrastructure, additionalities, externalities |
| JEL: | H41 O22 |
| Date: | 2010 |
| URL: | http://d.repec.org/n?u=RePEc:eab:develo:2262&r=sea |
| By: | Klasen, Stephan; Lechtenfeld, Tobias; Povel, Felix |
| Abstract: | This paper investigates whether different types of female?headed households in Thailand and Vietnam are disadvantaged in terms of current consumption, exposure to shocks, consumption smoothing capacities, as well as vulnerability to poverty and downside risk. Using a unique panel data set of over 4000 rural households in both countries, we find that female headed households with an absent husband appear to be better off in terms of current consumption in both countries (suggesting a positive impact of remittances). However, de jure female headed households in Thailand and Vietnam are more exposed to shocks and are less able to insure their consumption against income shocks than other households. In line with this finding de jure female headed households are also more vulnerable to perceived downside risk. Instead, de facto female headed households are less vulnerable to poverty and not worse off in terms of vulnerability to perceived downside risk. -- |
| Keywords: | Poverty,Gender Analysis,Vulnerability to Poverty,Inter?generational Poverty |
| Date: | 2010 |
| URL: | http://d.repec.org/n?u=RePEc:zbw:gdec10:43&r=sea |
| By: | Ngokkuen, Chuthaporn; Grote, Ulrike |
| Abstract: | Geographical indications (GIs) have gained more interest since its protection has been ensured multilaterally under the Trade-Related Aspects of Intellectual Property Rights (TRIPS) Agreement of the World Trade Organization (WTO). Thung Kula Rong-Hai Thai Hom Mali Rice (TKR) is the first officially registered GI Jasmine rice in Thailand. A GI certification is licensed to producers and other business operators of the GI production line through a membership application in a GI club. This paper aims at identifying factors that are likely to predict the behaviour of Thai Jasmine rice households in the Thung Kula Rong-Hai (TKRH) area in adopting a GI certification. A logit model is applied for empirical analyses. The marginal effects of the key factors on the probability of adoption are estimated. All analyses are based on survey data collected through a formal survey in two districts of the TKRH area where 541 Thai Jasmine rice households were selected for interviews using a disproportionate stratified random sampling procedure. The results indicate that institutional and social factors such as information, transportation costs and membership of a cooperative influence the decision to obtain the GI certification of the Thai Jasmine rice households in the TKRH area significantly. -- |
| Keywords: | Geographical Indications,Certification,Adoption,Logit Model,Jasmine rice,Thung Kula Rong-Hai,Thailand |
| Date: | 2010 |
| URL: | http://d.repec.org/n?u=RePEc:zbw:gdec10:52&r=sea |
| By: | Birol, Ekin; Asare-Marfo, Dorene; Yakhshilikov, Yorbol |
| Abstract: | In this paper, we present the results of a two-stage expert elicitation (Delphi) study conducted to provide input to contingent valuation (CV) studies. These CV studies are designed to estimate the benefits of various public and private strategies for the control of Highly Pathogenic Avian Influenza (HPAI) across the study countries of Ethiopia, Ghana, Indonesia, Kenya, and Nigeria. The results of these CV studies are expected to feed into the cost-benefit and cost-effectiveness analyzes, which will be conducted to identify the effective HPAI control strategies in each study country. The information gathered through the Delphi study included (1) definitions of the small-scale producers (noncommercial/semicommercial and commercial) across the study countries, (2) estimations of the efficacy of various private and public control strategies in HPAI control, and (3) estimates of the proportion of poultry producers who are expected to adopt these control strategies under different scenarios. In this Delphi study, we collected data from 23 experts and analyzed the data by using statistical analysis methods. The results reveal that small-scale flocks are significantly larger in Indonesia, compared to the four African countries. The efficacy levels of both private and public HPAI control strategies investigated are significantly higher for commercial producers than for their noncommercial/semicommercial counterparts. Across private strategies and study countries, regular monitoring is thought to have the highest efficacy for those in the noncommercial/semicommercial sector, whereas regular disinfection and containment in hard material (as a combined strategy) was found to be the most effective strategy in minimizing risk in the commercial sector. Across public strategies and study countries, experts see surveillance by veterinary services as the most effective public sector HPAI control strategy in both the noncommercial/semicommercial and commercial sectors. Finally, according to the experts, small-scale poultry producers’ likelihood of adoption is low overall, although adoption rates are higher for commercial producers than for noncommercial/semicommercial producers. |
| Keywords: | Adoption, commercial sector, Delphi study, disease risk introduction and spread, efficacy, expert elicitation, Highly Pathogenic Avian Influenza, HPAI, noncommercial sector, private disease risk minimization strategies, public disease risk minimization strategies, semicommercial sector, small-scale poultry producers, |
| Date: | 2010 |
| URL: | http://d.repec.org/n?u=RePEc:fpr:ifprid:1023&r=sea |
| By: | Tongruksawattana, Songporne; Waibel, Hermann; Schmidt, Erich |
| Abstract: | Rural households in emerging market economies are often vulnerable to poverty due to negative shocks and limited capacity for effective ex-post coping. This study analyses the relationship between shock types and coping decisions of rural households using the panel survey data of some 2,200 households in Northeast Thailand in the context of the DFG Research Unit 756. Empirical observations show that a large share of households suffered shocks mainly related to ecological, economic, health and social aspects. Results from a univariate probit model show that wealth status and shock severity in terms of income and asset losses encourage coping action. Regarding types of coping measure, asking for remittances from migrant household members and relatives, taking on public support programs, reallocating household resources, borrowing from formal and informal sources, using savings and selling assets are dominant. Multivariate probit model elaborates on the effect of shock types, household characteristics and location factors on the choice of coping activity. Overall, the results suggest that shocks experienced by rural households are likely to negatively affect their future welfare and more effective social risk management strategies are needed. -- |
| Keywords: | Keywords: shocks,coping actions,vulnerability to poverty,rural households,Thailand |
| Date: | 2010 |
| URL: | http://d.repec.org/n?u=RePEc:zbw:gdec10:53&r=sea |
| By: | Peter C. B. Phillips (Cowles Foundation, Yale University); Jun Yu (Singapore Management University) |
| Abstract: | A new recursive regression methodology is introduced to analyze the bubble characteristics of various financial time series during the subprime crisis. The methods modify a technique proposed in Phillips, Wu and Yu (2010) and provide a technology for identifying bubble behavior and consistent dating of their origination and collapse. The tests also serve as an early warning diagnostic of bubble activity. Seven relevant financial series are investigated, including three financial assets (the Nasdaq index, home price index and asset-backed commercial paper), two commodities (the crude oil price and platinum price), one bond rate (Baa), and one exchange rate (Pound/USD). Statistically significant bubble characteristics are found in all of these series. The empirical estimates of the origination and collapse dates suggest an interesting migration mechanism among the financial variables: a bubble first emerged in the equity market during mid-1995 lasting to the end of 2000, followed by a bubble in the real estate market between January 2001 and July 2007 and in the mortgage market between November 2005 and August 2007. After the subprime crisis erupted, the phenomenon migrated selectively into the commodity market and the foreign exchange market, creating bubbles which subsequently burst at the end of 2008, just as the effects on the real economy and economic growth became manifest. Our empirical estimates of the origination and collapse dates match well with the general datetimes of this crisis put forward in a recent study by Caballero, Farhi and Gourinchas (2008). |
| Keywords: | Financial bubbles, Crashes, Date stamping, Explosive behavior, Mildly explosive process, Subprime crisis, Timeline |
| JEL: | C15 C12 |
| Date: | 2010–09 |
| URL: | http://d.repec.org/n?u=RePEc:cwl:cwldpp:1770&r=sea |
| By: | J.A Giesecke; Tran Hoang Nhi |
| Abstract: | Summary measures of VAT compliance rates are valuable for identifying problem areas in VAT implementation. They are also essential for meaningful cross-country and cross-time comparisons of VAT compliance. We present a comprehensive and general framework for calculating VAT compliance rates at both the economy-wide and detailed sectoral levels. Unlike existing measures of VAT compliance, our framework isolates a compliance measure from the effects on VAT receipts of detailed features of VAT systems as actually implemented by tax authorities. These features include multiple VAT rates, exemptions, registration rates, refund limitations, informal activity, taxation of domestic non-residents, and undeclared imports. We implement our comprehensive VAT compliance measure for Vietnam, a country with a complex VAT system. Our estimate of Vietnam's VAT compliance rate is about eleven percentage points higher than that calculated by the most popular measure of compliance, collection efficiency (CE). Our method facilitates decomposition of the difference between CE and our VAT compliance measure into the individual contributions of statutory and structural features of Vietnam's VAT regime. |
| Keywords: | VAT, collection efficiency, revenue ratio, compliance rate |
| JEL: | H25 H26 C68 |
| Date: | 2010–08 |
| URL: | http://d.repec.org/n?u=RePEc:cop:wpaper:g-206&r=sea |
| By: | Doan, Tinh; John, Gibson |
| Abstract: | A common phenomenon about transition economies is that the return to schooling improves as economic reform progresses. Existing research suggests that Vietnam is not an exception to the pattern. However, the rate of return in period from 1992 to 1998 is still relatively low, below 5 percent, relative to that of the world and other transitional economies. And it is hard to see a clear trend in the current literature due to different methods applied and sets of variables controlled in the earnings equations (see Appendix B). The low returns may result from the gradual economic reforms applied in Vietnam, whilst in Eastern European countries the “Big Bang” transformation was conducted. Therefore, to test whether the return to schooling in Vietnam is rising and reaches other transitional economies’ rate of returns, we re-examine the trend in the rate of return to schooling in Vietnam over the 1998-2008 period, when the reforms have had a longer time to have an effect. We apply the OLS and Heckman selection estimator (Maximum Likelihood approach) and find that the return has increased quickly during the later economic reform but its pace has slowed down when the return reached the global average rate of returns at somewhere between 9 and 10 percent. |
| Keywords: | economic transition; returns to schooling; Vietnam |
| JEL: | J31 O15 |
| Date: | 2010–04–21 |
| URL: | http://d.repec.org/n?u=RePEc:pra:mprapa:24986&r=sea |
| By: | Yu, Bingxin; Zhu, Tingju; Breisinger, Clemens; Hai, Nguyen Manh |
| Abstract: | Vietnam is likely to be among the countries hardest hit by climate change, mainly through rising sea levels and changes in rainfall and temperatures. Agriculture can be extensively affected by climate change, and designing effective adaptation strategies will be critical for maintaining food security, rural employment, and foreign exchange earnings. This paper examines these critical issues and thereby makes two contributions to the literature. First, we estimate the impacts of climate change on agricultural and water systems in Vietnam based on crop simulation, hydrological simulation, and river basin models. We then present a yield function approach that models technology advances and policy interventions to improve rice productivity and mitigate the impact of climate change, using a multilevel mixed effects model. This two-pronged approach allows rice yield changes to be linked with both biophysical and socioeconomic conditions. The results indicate that rice production is likely to be severely compromised by climate change. However, investment in rural infrastructure, such as irrigation and road, and human capital can mitigate the negative impacts of climate change. Due to substantial regional variations in impacts and responses, localized policy packages will be key for effective mitigation. Government policies targeting ethnic-minority and poor communities will be especially important components of climate change adaptation strategies. |
| Keywords: | Climate change, productivity, rice, |
| Date: | 2010 |
| URL: | http://d.repec.org/n?u=RePEc:fpr:ifprid:1015&r=sea |
| By: | Kemper, Niels; Klump, Rainer |
| Abstract: | This article evaluates the impact of land-use certificate (LUC) issuance on credit market outcomes of households in rural Vietnam. Given the absence of appropriate data for the creation of a baseline (e.g. for difference-in-difference estimation), we propose an alternative regression-based evaluation procedure hinging on two pivotal steps: Firstly, we express the covariates related to a change in LUC status in terms of the household specific economic, social and geographic environment at the time the change occurred. Secondly, we estimate the propensity score to account for systematic pretreatment differences between households in the observational data. Conditional on the propensity score, we estimate the causal effect of LUC status on borrowing outcomes. We find that LUCs have a strong positive effect on formal borrowing, while households without LUCs collect loans in the informal credit sector. -- |
| Keywords: | Credit,consistency,land reform,program evaluation,Vietnam |
| JEL: | O16 C13 |
| Date: | 2010 |
| URL: | http://d.repec.org/n?u=RePEc:zbw:gdec10:49&r=sea |