nep-sea New Economics Papers
on South East Asia
Issue of 2011‒09‒22
eight papers chosen by
Kavita Iyengar
Asian Development Bank

  1. Beyond Product Lifecycle and Flying Geese: International Competitiveness of East Asian Region and the Japanese Position within By KIKKAWA, TAKEO
  2. Impediments to Growth of the Garment and Food Industries in Cambodia: Exploring Potential Benefits of the ASEAN-PRC FTA By Chheang, Vannarith; Hamanaka, Shintaro
  3. Lao People’s Democratic Republic: responding to rice price inflation By Loening, Josef L.
  4. Improving educational quality through enhancing community participation : results from a randomized field experiment in Indonesia By Pradhan, Menno; Suryadarma, Daniel; Beatty, Amanda; Wong, Maisy; Alishjabana, Armida; Gaduh, Arya; Artha, Rima Prama
  5. Japan's New Growth Strategy to Create Demand and Jobs By Randall S. Jones; Byungseo Yoo
  6. The Current State of the Financial Sector and the Regulatory Framework in Asian Economies—The Case of the People’s Republic of China By Ping, Luo
  7. The Political Economy of Deforestation in the Tropics By Robin Burgess; Matthew Hansen; Benjamin A. Olken; Peter Potapov; Stefanie Sieber
  8. The Expansion of Silk Textile Export in Northern Italy, 1919-1929 By Makiko Hino

    Date: 2011–09
  2. By: Chheang, Vannarith (Cambodian Institute for Cooperaiton and Peace); Hamanaka, Shintaro (Asian Development Bank)
    Abstract: This paper attempts to identify structural constraints to growth and exports within Cambodia’s key industries and to consider the policy actions needed to reduce obstacles to trade. The paper places special emphasis on Cambodia’s exports to the People’s Republic of China (PRC), given the major export opportunities arising from the free trade agreement (FTA) between the Association of Southeast Asian Nations (ASEAN) and the PRC, known as the ASEAN–[People’s Republic of] China FTA (ACFTA). A qualitative case study method was applied at the firm-level by conducting face-to-face interviews to identify the impediments to the growth and exports of key industries in Cambodia, and to examine the opportunities and challenges presented by the ACFTA. This study covers the garment and food industries, which are critical to the economic development of Cambodia in the context of regional and global economic integration. The food industry, with its large number of small and medium-sized enterprises, has great potential for contributing to pro-poor growth in Cambodia, while the textile industry is the largest employer in the Cambodian labor force and is critical for poverty reduction efforts through export-led growth. The study also provides policy recommendations at both the industry and government levels.
    Keywords: Cambodian economy; garment industry; food industry; ASEAN-[People’s Republic of] China FTA; firm-level analysis; bribery
    JEL: F13 F14 F15
    Date: 2011–09–01
  3. By: Loening, Josef L.
    Abstract: The objective of this study is to identify likely factors driving the 2010 rice price hike and suggest options to manage rice price volatility in the future. Regional trade is likely the main proximate cause for high glutinous rice prices. Trade with Vietnam was likely the main reason for short-term price fluctuations, while trade with Thailand affects medium- and long-term price trends. By contrast, traditional supply and demand factors explain only a small part of rice price inflation. There is, however a possibility that major supply shocks may be regional, which could affect Laos, Thailand, and Vietnam simultaneously. The effectiveness of government policy measures has been mixed. There is a need to closely coordinate rice production and trade policies in order to effectively manage price volatility. Future analysis should look at regional glutinous rice production trends and related trade flows.
    Keywords: Food prices; rice prices; sticky rice; regional trade; economic policy; Lao PDR; Thailand; Vietnam
    JEL: O18 Q11 O53 F14 I32
    Date: 2011–08–15
  4. By: Pradhan, Menno; Suryadarma, Daniel; Beatty, Amanda; Wong, Maisy; Alishjabana, Armida; Gaduh, Arya; Artha, Rima Prama
    Abstract: This study evaluates the effect of four randomized interventions aimed at strengthening school committees, and subsequently improving learning outcomes, in public primary schools in Indonesia. All study schools were randomly allocated to either a control group receiving no intervention, or to treatment groups receiving a grant plus one or a combination of three interventions: training for school committee members, a democratic election of school committee members, or facilitated collaboration between the school committee and the village council, also called linkage. Nearly two years after implementation, the study finds that measures to reinforce existing school committee structures, the grant and training interventions, demonstrate limited or no effects; while measures that foster outside ties between the school committee and other parties, linkage and election, lead to greater engagement by education stakeholders and in turn to learning. Test scores improve in Indonesian by 0.17 standard deviations for linkage and 0.22 standard deviations for linkage+election. The election intervention alone leads to changes in time household members accompany children studying per week, but this does not lead to learning. Linkage is the most cost effective intervention, causing a 0.13 change in standard deviation in Indonesian test scores for each 100 dollars (US) spent.
    Keywords: Education For All,Tertiary Education,Primary Education,Teaching and Learning,Disability
    Date: 2011–09–01
  5. By: Randall S. Jones; Byungseo Yoo
    Abstract: The New Growth Strategy aims to create demand and jobs through regulatory reform and fiscal measures. The Strategy focuses on key challenges, notably climate change and population ageing, which can be turned into sources of growth. Given Japan’s precarious fiscal position, it is essential to co-ordinate spending related to the Strategy with the medium-term fiscal plan, in part by increasing the emphasis on regulatory reform. Such measures should cover the entire economy, rather than being limited to the seven areas identified in the Strategy. Among those areas, effectively promoting green innovation will require market-based instruments to place a price on carbon, preferably through a mandatory and comprehensive emissions trading system, to promote private investment, accompanied by a range of other policies. Achieving deeper economic integration with Asia depends on reducing support for agriculture to facilitate more bilateral and regional trade agreements, while bringing down barriers to foreign direct investment and foreign workers. Policies to expand venture capital would help launch innovative firms. This Working Paper relates to the 2011 OECD Economic Survey of Japan (<P>La Nouvelle stratégie de croissance du Japon visant à stimuler la demande et l'emploi<BR>La Nouvelle stratégie de croissance a pour objectif de stimuler la demande et l’emploi par le biais de la réforme de la réglementation et de mesures budgétaires. Elle met l’accent sur des enjeux fondamentaux, notamment le changement climatique et le vieillissement de la population, qui peuvent devenir des sources de croissance. La situation budgétaire du Japon étant délicate, il est primordial de coordonner les dépenses liées à la stratégie avec le plan budgétaire à moyen terme, en partie en privilégiant la réforme de la réglementation. Ces mesures devraient intéresser l’ensemble de l’économie, et non être limitées aux sept volets définis dans la stratégie. S’agissant de ces derniers, pour promouvoir efficacement l’innovation verte, il faudra utiliser des instruments fondés sur le marché pour instituer une tarification du carbone, de préférence dans le cadre d’un système obligatoire et complet d’échange de droits d’émission, afin d’encourager l’investissement privé, parallèlement à diverses autres mesures. Pour parvenir à une intégration économique plus étroite avec l’Asie, il importe de réduire le soutien à l’agriculture de manière à faciliter la multiplication des accords commerciaux bilatéraux et régionaux, tout en éliminant les obstacles à l’entrée des investissements directs étrangers et des travailleurs étrangers. Des mesures destinées à accroître le capital-risque favoriseraient la création d’entreprises innovantes. Ce Document de travail se rapporte à l’Étude économique de l’OCDE du Japon, 2011 (
    Keywords: Japan, regulatory reforms, financial sector, foreign direct investment, health care reforms, climate change, economic partnership agreements, immigration, free trade agreements, Japanese economy, green growth, regional development, New Growth Strategy, Asian economic integration, réforme de la réglementation, Japon, secteur financier, investissement direct étranger, changement climatique, accords de partenariat économique, accords libre-échange, réforme du système de soins de santé, économie japonaise, croissance verte, Nouvelle stratégie de croissance, intégration économique en Asie, développement régional
    JEL: F13 I18 Q54
    Date: 2011–09–06
  6. By: Ping, Luo (Asian Development Bank Institute)
    Abstract: Reform of financial regulation is a priority on the international agenda. At the call of the Group of Twenty Finance Ministers and Central Bank Governors (G-20), a number of new international standards have been issued, most notably Basel III. As a member of the G-20, the Financial Stability Board (FSB), and the Basel Committee on Banking Supervision, the People’s Republic of China (PRC) is now on a faster track in adopting international standards. However, the key issue for the PRC—as well as many other emerging markets—is to how to keep focused on the domestic policy agenda while adopting the new global standards.
    Keywords: financial regulation; basel iii; prc financial sector
    JEL: E44 E52 E58 G18 G28
    Date: 2011–09–15
  7. By: Robin Burgess; Matthew Hansen; Benjamin A. Olken; Peter Potapov; Stefanie Sieber
    Abstract: Tropical deforestation accounts for almost one-fifth of greenhouse gas emissions worldwide and threatens the world's most diverse ecosystems. The prevalence of illegal forest extraction in the tropics suggests that understanding the incentives of local bureaucrats and politicians who enforce forest policy may be critical to understanding tropical deforestation. We find support for this thesis using a novel satellite-based dataset that tracks annual changes in forest cover across eight years of institutional change in post-Soeharto Indonesia. Increases in the numbers of political jurisdictions are associated with increased deforestation and with lower prices in local wood markets, consistent with a model of Cournot competition between jurisdictions. Illegal logging increases dramatically in the years leading up to local elections, suggesting the presence of "political logging cycles". And, illegal logging and rents from unevenly distributed oil and gas revenues are short run substitutes, but this effect dissapears over time as political turnover occurs. The results illustrate how incentives faced by local government officials affect deforestation, and provide an example of how standard economic theories can explain illegal behavior.
    JEL: D73 L73
    Date: 2011–09
  8. By: Makiko Hino (Graduate School of Economics, Osaka University)
    Abstract: The purpose of this article is to examine the expansion and the aspect of silk textile export in Northern Italy, especially in Como district, during the period of 1919-1929, when the Italian silk textile industry gained an international competitive advantage. The author would like to propound some views to which little attention has been given. Generally speaking, the modernization of management organization in the early 1920fs accelerated the development of silk textile industry. Firstly, the textile machine industry concurrently came to grow, which made it possible to improve the quality of textiles and helped for the silk industry to acquire the new markets for its goods. Secondly, the increasing use of artificial silk from the early 1920fs drastically changed the situation around silk textile. Thirdly, the silk textiles with the new additional raw material came to be woven under the mass production system. Fourthly, the silk textile industry tried to improve the design of silk textiles for couture, and succeeded in reaching the forefront of Italian fashion, cooperated with the government. All of the above-mentioned facts did start when the British government imposed tariff barriers on the silk textile. At that time, Italy had no choice but to develop overseas market. In the second half of the 1920s, capturing the new markets of Asia, Africa and South America, the export of silk textiles including artificial silk as new mass products remarkably increased.
    Keywords: Italian Economic History, Silk textile industry, Export, Market, Fashion
    JEL: N60 N64 N94
    Date: 2011–09

This nep-sea issue is ©2011 by Kavita Iyengar. It is provided as is without any express or implied warranty. It may be freely redistributed in whole or in part for any purpose. If distributed in part, please include this notice.
General information on the NEP project can be found at For comments please write to the director of NEP, Marco Novarese at <>. Put “NEP” in the subject, otherwise your mail may be rejected.
NEP’s infrastructure is sponsored by the School of Economics and Finance of Massey University in New Zealand.