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on South East Asia |
| By: | Paul Mizen (University of Nottingham and Hong Kong Institute for Monetary Research); Serafeim Tsoukas (University of Nottingham and Hong Kong Institute for Monetary Research) |
| Abstract: | This paper investigates the determinants of firms' decision to issue public debt in emerging Asian economies, using a novel database covering the period 1995 to 2007. We use comparable micro level panel of eight countries - China, Hong Kong, Indonesia, Korea, Malaysia, Philippines, Singapore and Thailand - to explore the influence of firms' characteristics and indicators of bond market depth on the decision to issue corporate bonds. Our paper demonstrates the influence of firm-specific characteristics on the decision to issue bonds, especially an indicator that the firm made previous issues of bonds. It also finds that the effect of market liquidity and local market size on the decision is small but significant. Finally our results show that co-ordinated policies by national governments to encourage bond market development have had little impact on probability of bond issuance at the firm level in Asia. |
| Keywords: | Bond Financing, Financial Indicators, Emerging Asian Markets |
| JEL: | F32 F34 G32 G15 |
| Date: | 2010–06 |
| URL: | http://d.repec.org/n?u=RePEc:hkm:wpaper:182010&r=sea |
| By: | Lipsey, Robert E. (NBER); Sjöholm, Fredrik (Research Institute of Industrial Economics (IFN)) |
| Abstract: | Foreign direct investment has been important in the economic growth and global economic integration of developing countries over the last decades. Both Northeast and Southeast Asia, especially the latter, have been part of this development with increasing inflows of FDI and greater foreign participation in their economies. However, Indonesia has been an outlier within the region, with lower inflows of FDI than other countries, especially in manufacturing, and with lower inflows than could be expected from its size and other country characteristics. The inflows of FDI that have taken place have benefited Indonesia and we use the Asian experience to provide some suggestions as to what measures would increase FDI. A relatively poor business environment with inefficient institutions seems to be an important explanation behind the low inflows of FDI. |
| Keywords: | East Asia; Northeast Asia; Southeast Asia; Indonesia; Foreign Direct Investment; Multinational Firms |
| JEL: | F13 F23 O19 |
| Date: | 2010–09–27 |
| URL: | http://d.repec.org/n?u=RePEc:hhs:iuiwop:0852&r=sea |
| By: | Prabir De; Muthi Samudram; Sanjeev Moholkar |
| Abstract: | This study examines a range of crossborder infrastructure development issues related to the Asian countries. Despite active pursuit of private investment in infrastructure by most developing countries in Asia and a growing number of success stories, the pace of such investment remains slow. Participation by the private sector in infrastructure development has been mixed. While there has been moderate progress in national infrastructure development by the private sector, progress is rather limited in the case of development of crossborder infrastructure in Asia. [ADBI Working Paper 245] |
| Keywords: | infrastructure, Asian countries, infrastructure development, private sector, crossborder |
| Date: | 2010 |
| URL: | http://d.repec.org/n?u=RePEc:ess:wpaper:id:2939&r=sea |
| By: | Hwee Kwan Chow |
| Abstract: | This paper considers the choices facing the Asian tiger economies regarding growth strategies that foster trans-Pacific rebalancing. A review of historical data spanning 2000 to 2008 reveals only a slight widening of the overall current account surplus but that there is considerable variation across the countries, with Hong Kong, China exhibiting the biggest increase in the saving and investment (S-I) balance. [ADBI Working Paper 238] |
| Keywords: | Asian, economies, Hong Kong, China, investment |
| Date: | 2010 |
| URL: | http://d.repec.org/n?u=RePEc:ess:wpaper:id:2928&r=sea |
| By: | Chan, Tze-Haw; Hooy, Chee-Wooi |
| Abstract: | Over the last decade, China and Malaysia have committed to export-led growth policy based on maintenance of their undervalued currencies. While both nations have recorded current account surplus and devoted for regional trade integration, it was lately claimed that the Chinese foreign exchange regime poses her as a formidable export competitor and offers further threat to the crowding out of other developing Asian, including Malaysia. Such scenario motivated us to examine the dynamic nexus of exchange rate impact on bilateral export and import flows between China and Malaysia. Our analysis contributed in using high frequency monthly data for the recent period from January 1990 to January 2008, based on the Autoregressive Distributed Lag (ARDL) bound testing procedure and generalised impulse response analysis. Our empirical findings reveal that the Marshall-Lerner condition holds in the long run but only the short run import demands adhere to the potential J-curve pattern. In brief, the study supports for the complementary role of China instead of conflicting (competing) features in the China-Malaysia bilateral trading. |
| Keywords: | Exchange rates; J-curve; Marshall-Lerner Condition; ARDL Bound Test |
| JEL: | F10 F31 |
| Date: | 2010–04–06 |
| URL: | http://d.repec.org/n?u=RePEc:pra:mprapa:25546&r=sea |
| By: | Thorbecke, Willem (Asian Development Bank Institute); Lamberte, Mario (Asian Development Bank Institute); Komoto, Ginalyn (Asian Development Bank Institute) |
| Abstract: | This paper traces the effects of the "East Asian Miracle," the 1997-1998 Asian Crisis, the recovery, and the 2008-2009 global financial crisis on ASEAN countries. It also considers how ASEAN countries can sustain growth by leveraging production networks to facilitate technology transfer. To achieve this, ASEAN countries need to maintain an environment friendly to foreign investment by resisting corruption, providing consistent and coherent enforcement of laws and regulations at all governmental levels, and maintaining stable macroeconomic fundamentals. This paper then emphasizes that ASEAN countries should focus on climbing the value chain by investing in human capital. They can do this by providing children with adequate nutrition, healthcare, and primary education, providing high school students with a high quality education in science and math, and providing university students with scientific and engineering training. The educational system should also be careful to provide students with marketable skills that businesses need. Finally, the paper argues that ASEAN should promote regional financial integration to help channel savings to high-yielding investments in the region. |
| Keywords: | East asian economic history; sustainable growth; global financial crisis; ASEAN; technology transfer |
| JEL: | J24 O16 |
| Date: | 2010–09–27 |
| URL: | http://d.repec.org/n?u=RePEc:ris:adbiwp:0250&r=sea |
| By: | Willem Thorbecke; Ginalyn Komoto; Mario Lamberte |
| Abstract: | This paper traces the effects of the “East Asian Miracle,†the 1997–1998 Asian Crisis, the recovery, and the 2008–2009 global financial crisis on ASEAN countries. It also considers how ASEAN countries can sustain growth by leveraging production networks to facilitate technology transfer. To achieve this, ASEAN countries need to maintain an environment friendly to foreign investment by resisting corruption, providing consistent and coherent enforcement of laws and regulations at all governmental levels, and maintaining stable macroeconomic fundamentals. This paper then emphasizes that ASEAN countries should focus on climbing the value chain by investing in human capital. They can do this by providing children with adequate nutrition, healthcare, and primary education, providing high school students with a high quality education in science and math, and providing university students with scientific and engineering training. The educational system should also be careful to provide students with marketable skills that businesses need. Finally, the paper argues that ASEAN should promote regional financial integration to help channel savings to high-yielding investments in the region. [ADBI Working Paper 250] |
| Keywords: | East Asian Miracle, Crisis, ASEAN, production, environment friendly, foreign investment,macroeconomic, marketable skills, businesses |
| Date: | 2010 |
| URL: | http://d.repec.org/n?u=RePEc:ess:wpaper:id:2913&r=sea |
| By: | Pitt, Mark M. (Brown University); Menon, Nidhiya (Brandeis University) |
| Abstract: | This paper proposes a novel instrumental variable method for program evaluation that only requires a single cross-section of data on the spatial intensity of programs and outcomes. The instruments are derived from a simple theoretical model of government decision-making in which governments are responsive to the attributes of places and their populations, rather than to the attributes of individuals, in making allocation decisions across space, and have a social welfare function that is spatially weakly separable, that is, that the budgeting process is multi-stage with respect to administrative districts and sub-districts. The spatial instrumental variables model is then estimated and tested by GMM with a single cross-section of Indonesian census data. The results offer support to the identification strategy proposed. |
| Keywords: | spatial decentralization, program evaluation, instrumental variables, Indonesia |
| JEL: | C21 H44 O12 C50 |
| Date: | 2010–09 |
| URL: | http://d.repec.org/n?u=RePEc:iza:izadps:dp5208&r=sea |
| By: | Adams, Richard H., Jr.; Cuecuecha, Alfredo |
| Abstract: | This paper analyzes the impact of international remittances on poverty and household consumption and investment using panel data (2000 and 2007) from the Indonesian Family Life Survey. Three key findings emerge. First, using an instrumental variables approach to control for selection and endogeneity, it finds that international remittances have a large statistical effect on reducing poverty in Indonesia. Second, households receiving remittances in 2007 spent more at the margin on one key consumption good -- food -- compared with what they would have spent on this good without the receipt of remittances. Third, households receiving remittances in 2007 spent less at the margin on one important investment good -- housing -- compared with what they would have spent on this good without the receipt of remittances. Households receiving international remittances in Indonesia are poorer than other types of households, and thus they tend to spend their remittances at the margin on consumption rather than investment goods. |
| Keywords: | Population Policies,Debt Markets,Remittances,Small Area Estimation Poverty Mapping,Rural Poverty Reduction |
| Date: | 2010–09–01 |
| URL: | http://d.repec.org/n?u=RePEc:wbk:wbrwps:5433&r=sea |
| By: | Biswa Nath Bhattacharyay |
| Abstract: | This paper estimates the need for infrastructure investment, including energy, transport, telecommunications, water, and sanitation during 2010-2020, in order to meet growing demands for services and facilitate further rapid growth in the region. By using “top-down†and “bottom-up†approaches, this paper provides a comprehensive estimate of Asia’s need for infrastructure services. The estimates show that developing countries in Asia require financing of US$776 billion per year for national (US$747 billion) and regional (US$29 billion) infrastructure during 2010-2020 to meet growing demand. [ADBI Working Paper 248] |
| Keywords: | investment, energy, transport, telecommunications, water, infrastructure |
| Date: | 2010 |
| URL: | http://d.repec.org/n?u=RePEc:ess:wpaper:id:2911&r=sea |
| By: | Donghyun PARK and Andrew Rozanov; Donghyun PARK (Economics and Research Department (ERD), Asian Development Bank (ADB), 6 ADB Avenue, Mandaluyong City, PHILIPPINES 1550; Permal Investment Management Services Limited) |
| Abstract: | This paper explores the potential contribution of Asia’s sovereign wealth funds (SWFs) to the reform of the global foreign exchange reserve system. By diversifying the investment of Asia’s huge reserves into non-dollar denominated assets, Asian SWFs can help to dilute the dominant role of the US dollar as the global reserve currency. At the same time, by exposing reserve managers to a more diverse mix of currencies and asset classes, SWFs will better prepare them for the less dollar-centric global reserve system of the future. In addition to SWFs, other innovative policy options for more active reserve management include transferring some surplus reserves into national pension funds or into exchange traded funds which are distributed among local investors. Regardless of the exact form of more profit-oriented reserve management, it will require that countries build up a critical mass of skills and expertise in wealth preservation and management. |
| Keywords: | Foreign exchange reserves, global reserve system, global financial architecture, pension fund, exchange traded fund |
| JEL: | F31 F33 F21 |
| Date: | 2010–03 |
| URL: | http://d.repec.org/n?u=RePEc:nan:wpaper:1003&r=sea |
| By: | Guonan Ma; Robert McCauley |
| Abstract: | The Chinese authorities described the management of the renminbi after its 2005 unpegging from the US dollar as involving a basket of trading partner currencies. Outside analysts have detected few signs of such management. We find that, in the two years from mid-2006 to mid-2008, the renminbi strengthened gradually against trading partners' currencies within a narrow band. In mid-2008, the financial crisis interrupted this experiment and the bilateral renminbi/dollar exchange rate stabilised at 6.8. The 2006-08 experience suggests that a shared policy of gradual nominal effective appreciation renders East Asian currencies quite stable against one another. Such a shared policy would create favourable conditions for regional monetary cooperation. |
| Keywords: | exchange rate regime, renminbi, effective exchange rate, regional currency stability, regional monetary cooperation |
| Date: | 2010–09 |
| URL: | http://d.repec.org/n?u=RePEc:bis:biswps:321&r=sea |
| By: | Ying Yi Tsai; Li-Gang Liu |
| Abstract: | The present analysis sheds light on the setting up a regional rating agency in Asia in the wake of recent financial crisis. We investigate the policy facing a financial regulator while evaluating whether or not to admit new entrants into the credit rating market. In an incomplete contracting framework, we show that an impartial financial regulatory body (represented by a benevolent supranational organization) can facilitate credit ratings of high quality by allowing for the entry of new rating agencies on a non-single basis than it does for a mere single entry. This finding is caused by increased competition among the rating agencies, which induces higher quality of rating services even should rating agencies still exert below their maximum level of efforts. |
| Keywords: | analysis, regional, financial, framework |
| Date: | 2010 |
| URL: | http://d.repec.org/n?u=RePEc:ess:wpaper:id:2927&r=sea |
| By: | Shyamala Gopinath |
| Abstract: | It is being acknowledged that a macro prudential perspective is critical in designing and pursuing micro prudential regulation of institutions and markets. Two distinct but highly inter-related constructs have come to epitomize this post-crisis framework: macro prudential regulation and systemic risk management. Both these concepts are philosophically appealing and conceptually sound, but operationally quite challenging. Understanding the nuanced interplay between these would be crucial in designing an efficient operative framework for financial stability. [Paper presented at the ADBI-BNM Conference on “Macroeconomic and Financial Stability in Asian Emerging Marketsâ€, Kuala Lumpur]. |
| Keywords: | asian, emerging, markets, macro prudential, micro, crisis, philosophically, framework, financial stability, institutions, markets, risk management, economic, procyclical, bank, capital, |
| Date: | 2010 |
| URL: | http://d.repec.org/n?u=RePEc:ess:wpaper:id:2917&r=sea |
| By: | Cassimon, Danny; Prowse, Martin; Essers, Dennis |
| Abstract: | The vital role of forests in limiting the likelihood of dangerous climate change has precipitated renewed interest in debt-for-nature swaps. This article uses evidence on past debt-for-nature swaps and similar debt mechanisms to assess the recent second wave of debt swaps. It outlines five typical shortcomings of this form of financial transaction: that they often fail to deliver additional resources to the debtor country; often fail to deliver more resources for conservation/climate purposes; often have a negligible effect on overall debt burdens, and, as such, do not generate more ‘indirect’ benefits; and are often in conflict with the new aid delivery paradigm’s emphasis on alignment with government policy and systems. Our analysis is applied to a recent debt-for-nature swap initiative between the United States and Indonesia. We show that this case, which we consider as a litmus test for current swap practice, performs unevenly across the five shortcomings identified. On the one hand, the swap does not create additional resources for the Government of Indonesia, is too insignificant to create indirect (positive) economic effects, and appears at odds with the new aid delivery paradigm’s insistence on system alignment. On the other hand, the swap does not reduce Government of Indonesia resources, and is very much in line with current national policy. The extent to which the resources provided by the swap are additional to other donor support and reserved domestic budget lines for conservation goals is unclear. Whilst a second generation of debt-for-nature swaps should clearly be avoided, there is a need to debate broader ways of linking debt service repayments to forest conservation. |
| Date: | 2009–12 |
| URL: | http://d.repec.org/n?u=RePEc:iob:wpaper:2009007&r=sea |
| By: | Murhadi, Werner-Ria |
| Abstract: | This paper is an empirical assessment of the performance of mutual fund managers in terms of “market timing” and “selectivity”, within the framework suggested by Treynor and Mazuy (1966) and Henriksson and Merton (1981). The relevant data set is a balanced panel of fifty five mutual funds, over a seventeen-month period beginning on February 2008 until June 2009. The result find that only four mutual fund have a good performance in market timing and four mutual fund have a good performance in stock selection. Both methods have a good indicator to reflect mutual funds performance. |
| Keywords: | market timing; stock selection; mutual funds |
| JEL: | G11 G20 |
| Date: | 2010–03–09 |
| URL: | http://d.repec.org/n?u=RePEc:pra:mprapa:25498&r=sea |
| By: | Sengupta, Rajeswari; Aizenman, Joshua |
| Abstract: | In this paper we evaluate the current account patterns of China and Germany. We point out that China's current account surplus as a share of global GDP in recent years resembles that of Germany’s. Yet, an important difference is that the Euro block’s current account inclusive of Germany, has overall been balanced, whereas emerging Asia's current account inclusive of China, has mostly been characterized by sizable surpluses. We further find that both China and Germany's current account surpluses seem to be accounted for by common factors. However we have reasons to doubt the long run viability of these current account trends in future decades. Demographic transitions in China and Germany are projected to reduce their surpluses, and this effect is stronger for Germany. We also discuss plausible reasons to doubt the extent to which the Euro block will move towards significant surplus in the coming years. |
| Keywords: | current accounts; demographic transitions; global imbalances |
| JEL: | F15 F32 |
| Date: | 2010–09–23 |
| URL: | http://d.repec.org/n?u=RePEc:pra:mprapa:25578&r=sea |
| By: | Aurelie Sannajust (COACTIS - Université Lumière - Lyon II : EA4161 - Université Jean Monnet - Saint-Etienne) |
| Abstract: | This article deals with the motivations and the different sources of value from Public to Private Transactions in Europe, USA and Asia from 2000 to 2007. We determine eight main motivations (Tax savings, Incentive realignment, Control, Free Cash Flow, Growth of Prospects, Transaction Costs, Takeover Defence and Undervaluation). Then, we evaluate the shareholder wealth by measuring the offered premiums and the CAAR (Cumulative Average Abnormal Return). Finally we analyse the impact of Public to Private to the wealth shareholder. The main sources for firms from going private are incentive realignment, Free Cash Flow (mostly for Asia), the economy of cost transaction and undervaluation. Furthermore, taxation benefit is a source of wealth effects for Asia and Family blockholder (for the control hypothesis) is significant for Europe. Premiums and CAAR are the most important for the USA and Asia. The main observation that we have made, is that Asia gets the same behavior as the USA. |
| Keywords: | Public to Private transactions, CAAR, Premium, wealth. |
| Date: | 2010–05–21 |
| URL: | http://d.repec.org/n?u=RePEc:hal:journl:halshs-00521239_v1&r=sea |
| By: | Aurelie Sannajust (COACTIS - Université Lumière - Lyon II : EA4161 - Université Jean Monnet - Saint-Etienne) |
| Abstract: | This article deals with the motivations and the different sources of value from Public to Private Transactions in Europe, USA and Asia from 2000 to 2007. We determine eight main motivations (Tax savings, Incentive realignment, Control, Free Cash Flow, Growth of Prospects, Transaction Costs, Takeover Defence and Undervaluation). Then, we evaluate the shareholder wealth by measuring the offered premiums and the CAAR (Cumulative Average Abnormal Return). Finally we analyse the impact of Public to Private to the wealth shareholder. The main sources for firms from going private are incentive realignment, Free Cash Flow (mostly for Asia), the economy of cost transaction and undervaluation. Furthermore, taxation benefit is a source of wealth effects for Asia and Family blockholder (for the control hypothesis) is significant for Europe. Premiums and CAAR are the most important for the USA and Asia. The main observation that we have made, is that Asia gets the same behavior as the USA. |
| Keywords: | Public to Private transactions, CAAR, Premium, wealth. |
| Date: | 2009–10–01 |
| URL: | http://d.repec.org/n?u=RePEc:hal:journl:halshs-00521180_v1&r=sea |
| By: | Felix Povel (Georg-August-University Göttingen) |
| Abstract: | In this paper we propose an approach to vulnerability called perceived vulnerability to downside risk. We argue that the other concepts of vulnerability, though partially adhering to the focus axiom, do not exclusively consider downside risks in their measures. The reason for this is that most of them use a pre-determined threshold such as the poverty line as their benchmark for analysis. Instead, we opt for the current level of wellbeing of a household as reference point. Also, we propose to use subjective risk perception as the source of information for quantifying vulnerability since it overcomes some of the shortcomings connected to the reliance on information about the past. Finally, we apply the measure of perceived vulnerability to downside risk to risk perception data from Thailand and Vietnam and find that households in the latter country tend to be more vulnerable than households in the former. Moreover, determinants of perceived vulnerability to downside risk differ significantly between the two countries. |
| Keywords: | Vulnerability; Risk; Risk Perception; Subjective Wellbeing |
| JEL: | D81 I31 I32 O12 |
| Date: | 2010–09–28 |
| URL: | http://d.repec.org/n?u=RePEc:got:gotcrc:043&r=sea |
| By: | Kim, Anna Myunghee (IZA) |
| Abstract: | This paper examines an atypical south-north labour migration that emerged in the post-socialist international migration system: China-to-South Korea ethnic labour migration. Over the past decade, South Korea has experienced an unprecedented increase in the arrival of foreign labour. The majority of workers come from the People's Republic of China. Based on a contextual multivariate analysis of primary survey data on 525 predominantly undocumented Korean Chinese labour migrants in Seoul, this study reveals the underexplored economic dimension of ethnic migration in Northeast Asia. Empirical findings on this source of migrant labour in South Korea demonstrate that the China-to-South Korea ethnic population movement is an important yet an unknown dimension of the post-socialist global migration regime that is marked by the New Economics of international labour migration. The study suggests that ethnic migration from a socialist transition economy to a capital-rich economy linked through ancestral connections must be reconsidered in the context of the changing global migration and demographic landscapes, rather than the ethno-nationally romanticised view of the return of diaspora. |
| Keywords: | ethnic labour migration, post-socialist global migration regime, new economics of international labour migration |
| JEL: | J6 |
| Date: | 2010–09 |
| URL: | http://d.repec.org/n?u=RePEc:iza:izadps:dp5214&r=sea |
| By: | Felix Povel (Georg-August-University Göttingen) |
| Abstract: | In this paper we propose a new measure of vulnerability called vulnerability to downside risk. The relevant benchmark for this new measure is the current level of wellbeing of a household as opposed to another benchmark such as the poverty line. We argue that this measure adds complementary information to existing measures such as Calvo and Dercon’s (2007) axiomatic measure of vulnerability to poverty. We apply a measure of both vulnerability to downside risk and to poverty to data from Vietnam. We show that consumption smoothing capacities and the probability to experience an adverse event differ substantially between different wealth groups. Consequently, the relation between initial wealth and vulnerability to downside risk is highly non-linear. While moderately but not extremely poor households are relatively vulnerable to extreme poverty, they are less vulnerable to downside risk than any other group of households. |
| Keywords: | Vulnerability; Poverty; Shocks; Risk |
| JEL: | D81 I31 I32 O12 |
| Date: | 2010–09–28 |
| URL: | http://d.repec.org/n?u=RePEc:got:gotcrc:044&r=sea |