nep-sea New Economics Papers
on South East Asia
Issue of 2013‒10‒18
twenty-six papers chosen by
Kavita Iyengar
Asian Development Bank

  1. The lighting fixtures market in Asia Pacific By Aurelio Volpe
  2. Modelling Volatility Spillover Effects Between Developed Stock Markets and Asian Emerging Stock Markets By David E. Giles; Yanan Li
  3. RMB internationalisation and currency co-operation in East Asia By Volz, Ulrich
  4. Managing Economic Shocks and Macroeconomic Coordination in an Integrated Region: ASEAN Beyond 2015 By Ruperto MAJUCA
  5. Economic and Welfare Impacts of Disasters in East Asia and Policy ResponsesL The Case of Vietnam By LeDang TRUNG
  6. Indonesia : Toward Universal Access to Clean Cooking By World Bank
  7. Index-Based Risk Financing and Development of Natural Disaster Insurance Programs in Developing Asian Countries By Sommarat CHANTARAT; Kirk PANNANGPETCH; Nattapong PUTTANAPONG; Thanasin TANOMPONGHANDH
  8. Will income inequality cause a middle-income trap in Asia? By Akio Egawa
  9. Exchange Rate Policy and Regional Trade Agreements: A Case of Conflicted Interests? By Pomfret, Richard; Pontines, Victor
  10. Competition Policy Challenges of Single Market and Production Base By Cassey LEE; Yoshifumi FUKUNAGA
  11. Growing an ASEAN Voice? : A Common Platform in Global and Regional Governance By Simon TAY
  12. Labor migration and economic growth in east and southeast Asia By Walmsley, Terrie; Aguiar, Angel; Ahmed, S. Amer
  13. Support for Agricultural Restructuring Project : The Financial and Economic Competitiveness of Rice and Selected Feed Crops in Northern and Southern Vietnam By World Bank
  14. Financial Sector Assessment Program : Malaysia - Core Principles for Effective Deposit Insurance Systems By International Monetary Fund; World Bank
  15. Financial Sector Assessment Program : Malaysia - Assessment of Observance of the CPSS-IOSCO Principles for Financial Market Infrastructures By International Monetary Fund; World Bank
  16. Myanmar's apparel industry in the new international environment : prospects and challenges By Kudo, Toshihiro
  17. Financial Sector Assessment Program : Malaysia - Basel Core Principles for Effective Banking Supervision By World Bank; International Monetary Fund
  18. Financial Sector Assessment Program : Malaysia - IOSCO Objectives and Principles of Securities Regulation By World Bank; International Monetary Fund
  19. Moving MPAC Forward: Strengthening Public-Private Partnership, Improving Project Portfolio and in Search of Practical Financing Schemes By Hisanobu SHISHIDO; Shintaro SUGIYAMA; Fauziah ZEN
  20. Impact of Recent Crises and Disasters on Regional Production/Distribution Networks and Trade in Japan By Mitsuyo ANDO
  21. 2013 Global Hunger Index: The challenge of hunger: Building resilience to achieve food and nutrition security By von Grebmer, Klaus; Headey, Derek; Bene, Christophe; Haddad, Lawrence; Olofinbiyi, Tolulope; Wiesmann, Doris; Fritschel, Heidi; Yin, Sandra; Yohannes, Yisehac; Foley, Connell; von Oppeln, Constanze; Iseli, Bettina
  22. Impact of Disasters and Disaster Risk Management in Singapore: A Case Study of Singapore's Experience in Fighting the SARS Epidemic By Allen Yu-Hung LAI; Seck L. Tan
  23. Revisiting Italian Emigration Before the Great War: A Test of the Standard Economic Model By H. T. Tran; E. Santarelli
  24. Impact of Disasters and Role of Social Protection in Natural Disaster Risk Management in Cambodia By Sann VATHANA; Sothea OUM; Ponhrith KAN; Colas CHERVIER
  26. Bank lending strategy, credit scoring and financial crises By Kleimeier S.; Dinh T.H.T.; Straetmans S.T.M.

  1. By: Aurelio Volpe (CSIL Centre for Industrial Studies)
    Abstract: The report analyzes the lighting fixtures market in Asia Pacific. It provides historical statistical data of Production, International trade and Market size 2007-2012 of the lighting fixtures industry for the 11 countries considered. Macroeconomic forecasts up to 2015 are also provided. Demand is broken down by product and by light source. An overview of the competitive system is outlined, with short company profiles, data on sales and market shares for the top lighting fixtures companies for each Asia Pacific country considered. International trade of of lighting fixtures and distribution channels are included. Addresses of about 460 lighting fixtures manufacturers and other key contacts are also included. Countries covered: Australia, Indonesia, Japan, Malaysia, New Zealand, Philippines, Singapore, South Korea, Taiwan, Thailand, Vietnam.
    JEL: L11 L22 L68
    Date: 2013–09
  2. By: David E. Giles (Department of Economics, University of Victoria); Yanan Li
    Abstract: This paper examines the linkages of stock markets across the U.S., Japan and six Asian developing countries: China, India, Indonesia, Malaysia, the Philippines and Thailand over the period January 1, 1993 to December 31, 2012. The volatility spillover is modeled through an asymmetric multivariate GARCH model. We find significant unidirectional shock and volatility spillovers from the U.S. market to both the Japanese and the Asian emerging markets. It is also found that the volatility spillovers between the U.S. market and the Asian markets are stronger and bidirectional during the Asian financial crisis. Further, during the last five years, the linkages between the Japanese market and the Asian emerging markets became more apparent. Our paper contributes to the literature by examining both the long run and the short run periods and focusing on shock and volatility spillovers rather than return spillovers, which have been the primary focus of most other studies.
    Keywords: Volatility, Spillovers, Stock markets, Multivariate GARCH, Asymmetric BEKK model
    JEL: C32 C58 G1
    Date: 2013–10–08
  3. By: Volz, Ulrich
    Abstract: This paper scrutinises the state of RMB internationalisation and its likely progress over the coming years and discusses its implications for currency co-operation in East Asia. As part of its internationalisation, the RMB is gradually delinked from the dollar, which will effectively put an end to the East Asian dollar standard that has shaped the region's financial architecture over the last three decades and that has provided a relatively high degree of intra-regional exchange rate stability. Because of the close trade and investment ties that have developed across the region, the East Asian countries, especially the ASEAN countries which are striving to create an ASEAN Economic Community, will continue to manage their exchange rates and stabilise their currencies against one another to facilitate cross-border investment and commerce. But instead of a replacing of the dollar standard with an RMB standard we are likely to see some rather loose and informal exchange rate co-operation in East Asia based on currency baskets, with China herself moving towards a managed exchange rate system guided by a currency basket. --
    Keywords: RMB internationalisation,key currencies,Chinese economy,East Asian monetary co-operation,currency baskets
    JEL: E58 F33
    Date: 2013
  4. By: Ruperto MAJUCA (De La Salle University, Manila)
    Abstract: We examine the transmission of economic shocks both from the rest of the world into the ASEAN region, as well as the transmission of such shocks from the rest of the row and ASEAN into a typical AMS. The approach we take is three-pronged. First, we will look into the trade and financial linkages of a "typical" AMS. By "typical", we mean representative AMSs, e.g., Singapore for a developed country, Philippines or Indonesia for ASEAN5 economies and Vietnam for the CLMV (Cambodia, Lao, Myanmar, Vietnam) economies. We look at trade and financial linkages between these typical AMSs, the ASEAN as a whole, and the rest of the world. Second, we employ a specialized type of vector autoregression (VAR) model to decompose the shocks into trade shocks, financial shocks, and commodity price shocks. This we do for the typical AMS in relation to ASEAN and the rest of the world. By decomposing the shocks into their constituent components, we hope to glean important insights on, among others, which component shocks are more important for the typical AMS. Third, we estimate a global projection model in order to analyze how key macroeconomic variables (GDP, inflation, unemployment rate, interest rate, and exchange rate) are interrelated across regions (e.g., U.S., EU, Japan, China) and how these shocks are transmitted across these regions, and from these regions into ASEAN and a typical AMS. This way, we hope to trace how a shock originating from the U.S., for example, will impact EU's, Japan's, China's, and eventually ASEAN's, and a typical AMS's GDP, inflation, unemployment, interest rate, and exchange rates. We then conclude with an analysis of the implications of these on how to manage the economic shocks in an integrated region, as well as the implications for macroeconomic policy coordination in the region
    Keywords: regional integration, macroeconomic shocks, spillovers, vector autogressions, global projection model, Bayesian estimation
    JEL: C32 C51 E31 E52 F15 F41 F42 F43 F47
    Date: 2013–09
  5. By: LeDang TRUNG (Indochina Research and Consulting (IRC))
    Abstract: Although Vietnam has seen remarkable economic achievements over the last twenty-five years, the country is still one of the poorest countries in the world. Unfortunately, the country is prone to many natural hazards. Vietnam is located in one of the five cyclone centers on the planet. It is estimated that Vietnam is hit by 4.3 storms and more than 3 floods per year. Though the aftermaths of natural hazards are sizable, estimating their impacts is challenging, yet crucial for policy development. This paper aims to conduct a scientific assessment of the impact of a natural catastrophe to help understand the multidimensional costs of disasters, and to draw lessons on how the impacts of natural disasters can be properly assessed. In addition, it provides an overview of the management of natural disasters and climate change in Vietnam, to see how the policy system has been working to deal with the risk of natural disasters and climate change. Finally, it identifies possible options for Vietnam to move forward to an effective disaster risk management system.
    Keywords: Natural hazards, Storms, Floods, Impact evaluation, Matched sampling, Disaster management
    JEL: Q54 Q52 C21 O53
    Date: 2013–08
  6. By: World Bank
    Keywords: Energy - Renewable Energy Energy Conservation and Efficiency Macroeconomics and Economic Growth - Markets and Market Access Environmental Economics and Policies Energy - Energy Production and Transportation Environment
    Date: 2013–06
  7. By: Sommarat CHANTARAT (Crawford School of Public Policy, The Australian National University); Kirk PANNANGPETCH (Faculty of Agriculture, Khon Kaen University, Thailand); Nattapong PUTTANAPONG (Faculty of Economics, Thammasat University, Thailand); Thanasin TANOMPONGHANDH (School of Management, Mae Fah Luang University, Thailand)
    Abstract: This paper explores innovations in index-based risk transfer products (IBRTPs) as a means to address important insurance market imperfections that have precluded the emergence and sustainability of formal insurance markets in developing countries, where uninsured natural disaster risk remains a leading impediment of economic development. Using a combination of disaggregated nationwide weather, remote sensing and household livelihood data commonly available in developing countries, the paper provides analytical framework and empirical illustration on showing design nationwide and scalable IBRTP contracts, to analyse hedging effectiveness and welfare impacts at the micro level, and to explore cost effective risk-financing options. Thai rice production is used in our analysis with the goal to extend the methodology and implications to enhance development of national and regional disaster risk management in Asia.
    Keywords: Natural disaster insurance, index insurance, reinsurance, catastrophe bond, rice production, Thailand.
    JEL: Q54 G22 G12 Q11 O53
    Date: 2013–08
  8. By: Akio Egawa
    Abstract: The Asian economy is expected to realise favourable growth during the first half of this century, but there is no guarantee. There is a discussion about a â??middle-income trapâ??, which refers to a country that has realised rapid growth to become a middle-income country but is unable to grow further. A middle-income trap could occur not only if there is a delay in shifting the economy toward a productivity-driven structure, but also if there is a worsening of income distribution.We consider this in line with the theories of development economics and through a quantitative analysis. The relationship between income inequality and the trap can be explained by the Kuznets hypothesis and the basic-needs approach. Our quantitative analysis supports the Kuznets hypothesis, and indicates that,although a low-income country can accelerate its economic growth with the worsening of income distribution as an engine, a middle income country would experience a decreasing growth rate if it fails to narrow the income gap between the top and bottom income groups. The results also show that the basic-needs approach is also applicable in practice, and imply that the improvement of access to secondary education is important. A sensitivity analysis for three Asian upper-middle-income countries(China, Malaysia and Thailand) also shows that the situation related to a middle-income trap is worse than average in China and Malaysia. These two countries, according to the result of the sensitivity analysis, should urgently improve access to secondary education and should implement income redistribution measures to develop high-tech industries, before their demographic dividends expire. Income redistribution includes the narrowing of rural urban income disparities, benefits to low-income individuals, direct income transfers, vouchers or free provision of education and health-care, and so on, but none of these are simple to implement.
    Date: 2013–10
  9. By: Pomfret, Richard (Asian Development Bank Institute); Pontines, Victor (Asian Development Bank Institute)
    Abstract: The results highlight the conflicting interests of countries — to stabilize exchange rates or to keep the option of exchange rate depreciation in order to maintain competitiveness of domestic tradable producers. With deepening integration in East Asia, however, the desire for exchange rate stability will eventually outweigh the desire to maintain a protectionist tool. How extensive the pressures will be in East Asia will depend not only on how many countries seriously desire to be in the more integrated economic area in which Factory Asia operates, but also on their institutional and political readiness to commit in such schemes at the cost of renouncing an important policy instrument.
    Keywords: regional trade agreement; exchange rate depreciation; exchange rate stability; asean+3
    JEL: F13 F14 F15 F42
    Date: 2013–10–09
  10. By: Cassey LEE (University of Wollongong, Australia); Yoshifumi FUKUNAGA (Economic Research Institute for ASEAN and East Asia)
    Abstract: Competition policy is an important beyond-the-border element of the single market and production base envisioned in the ASEAN Economic Community (AEC). The targets for competition policy in the AEC Blueprint have been largely met. Looking beyond 2015, ASEAN needs to consider broadening the policy measures for competition policy to encompass the state’s presence and interventions that affect the level playing field within markets. In the longer term, the main challenge for AEC will be related to the depth of integration desired in terms of harmonization of competition policy. Deeper integration may require fundamental changes in ASEAN institutions.
    Keywords: Competition Policy, Competition Law, Consumer Protection, ASEAN, Regional Integration, ASEAN Economic Community, AEC Blueprint
    JEL: F15 K21 L40 L50
    Date: 2013–09
  11. By: Simon TAY (Singapore Institute of International Affairs (SILA))
    Abstract: As ASEAN moves towards Community, the group’s increasing integration combines with extrinsic factors to increase the expectation and need to become play a more significant role in regional and global affairs. Yet ASEAN has had to date only a limited experience and its ethos of unity needs to be reinforced. The group faces many challenges in taking on such a regional and global role, including the very different levels of development of its member states and divergences in political and other interests. There are however precedents for ASEAN to act and speak in unison on both political-security issues as well as economics and an increasing need and will to do so. As the group begins to take on a central role in the region and first steps on the global stage, there remains the challenge of maintaining ASEAN unity, fostering shared perspectives and thereby forging an ASEAN platform or common voice in international forums, negotiations and institutions. The essay explores this issue and attempts to provide recommendations toward engendering such common ASEAN positions and platforms in international arena beyond 2015. It argues that ASEAN should aim to create and reiterate norms to emerge as a normative power. However, even as a common voice and platform grows, ASEAN member states should be allowed to access their own existing channels and coalitions. An ASEAN common voice and platform should not be a monopoly or main conduit but an additional and supplementary avenue that each ASEAN member states can access. The essay concludes with some suggestions on the emerging needs and opportunities for ASEAN’s common voice and policy prescriptions.
    Date: 2013–09
  12. By: Walmsley, Terrie; Aguiar, Angel; Ahmed, S. Amer
    Abstract: East and Southeast Asia face major demographic changes over the next few decades as many countries'labor forces will start to decline, while others will experience higher labor force growth as populations and participation rates increase. A well-managed labor migration strategy presents itself as a mechanism for ameliorating the impending labor shortages in some East-Asia Pacific countries, while providing an opportunity for other countries with excess labor to provide migrant workers that will contribute to the development of the home country through greater remittance flows. Although migration would be unable to offset the economic impacts of the declining labor forces in the countries with shrinking populations, a more flexible migration policy, allowing migrants to respond to the major demographic changes occurring in Asia over the next 50 years, would be beneficial to most economies in the region in terms of real incomes and real gross domestic product over the 2007-2050 period. Such a policy could deeply affect the net migration position of a country. Countries that were net recipients under current migration policies might become net senders under the more liberal policy regime.
    Keywords: Population Policies,Labor Markets,Banks&Banking Reform,Labor Policies,Economic Growth
    Date: 2013–10–01
  13. By: World Bank
    Keywords: Rural Development Knowledge and Information Systems Agriculture and Farming Systems Agriculture - Climate Change and Agriculture Crops and Crop Management Systems Economic Theory and Research Rural Development Macroeconomics and Economic Growth
    Date: 2013–01
  14. By: International Monetary Fund; World Bank
    Keywords: Finance and Financial Sector Development - Deposit Insurance Finance and Financial Sector Development - Debt Markets Banks and Banking Reform Private Sector Development - Emerging Markets Finance and Financial Sector Development - Bankruptcy and Resolution of Financial Distress
    Date: 2013–02
  15. By: International Monetary Fund; World Bank
    Keywords: Finance and Financial Sector Development - Debt Markets Banks and Banking Reform Private Sector Development - Emerging Markets Payment Systems and Infrastructure Finance and Financial Sector Development - Bankruptcy and Resolution of Financial Distress
    Date: 2013–02
  16. By: Kudo, Toshihiro
    Abstract: Myanmar’s apparel industry had long been denied access to Western markets due to sanctions against its military government. The birth of a "civilian" government in March 2011 improved Myanmar’s relations with the international community, and Western sanctions were largely lifted. Regained market access is expected to trigger rapid growth of Myanmar’s apparel exports. This paper examines this impact with a comparison to Vietnam’s apparel industry. The industry’s prospects are getting bright, but the business environment has recently changed drastically in Myanmar. A new challenge for Myanmar’s apparel industry is remaining globally competitive. This paper also examines advantages and disadvantages that apparel firms in Myanmar experience. Although its abundance of low-wage workers remains a source of competitiveness, Myanmar needs its government to play a more active role to build the foundation of the industry.
    Keywords: Myanmar, Apparel industry, Myanmar (Burma), Apparel, International market, Export, Sanctions, Economic growth
    JEL: F14 J39 L67
    Date: 2013–09
  17. By: World Bank; International Monetary Fund
    Keywords: Finance and Financial Sector Development - Financial Intermediation Banks and Banking Reform Finance and Financial Sector Development - Debt Markets Private Sector Development - Emerging Markets Finance and Financial Sector Development - Access to Finance
    Date: 2013–02
  18. By: World Bank; International Monetary Fund
    Keywords: Finance and Financial Sector Development - Debt Markets Banks and Banking Reform Private Sector Development - Emerging Markets Macroeconomics and Economic Growth - Markets and Market Access Finance and Financial Sector Development - Access to Finance
    Date: 2013–02
  19. By: Hisanobu SHISHIDO (Tokyo Women's Christian University); Shintaro SUGIYAMA (Economic Research Institute for ASEAN and East Asia); Fauziah ZEN (Economic Research Institute for ASEAN and East Asia)
    Abstract: Infrastructure investment has high economic returns, especially in ASEAN economies where enhanced connectivity is critical for their continued prosperity. Each member government needs to ensure infrastructure gaps are narrowed through both the government’s own funding and public-private partnership (PPP) arrangements. With regard to PPP projects, the best way to attract private participants is to make projects commercially viable through: (i) careful project development carried out (or advised) by high caliber experts; (ii) adequate spending on project development; and (iii) improvements in the PPP-readiness of member countries in terms of legal, regulatory and institutional environment. We propose that a center of excellence for PPP-related investments be established advising each government and its PPP-units on project selection and development—and carrying out project development for cross-border PPP projects. The center should be staffed with private sector experts or those with private business experience and consider ASEAN regional priorities. Donors should help substantially—given the high growth and poverty reduction impact that infrastructure development has. Too much focus on the funding aspect alone could be counterproductive. However, recognizing the increased risk aversion of the capital markets around the world as a result of the international financial crisis of 2008-09 and the introduction of Basel III, we propose that a new financial instrument be considered that reduces the perceived risk of PPP projects. There should be some lessons to be learnt from the initiatives of project bond credit enhancement started by the European Investment Bank (EIB), which has been received positively by the market.
    Keywords: Private participation in infrastructure development, Public Private Partnership (PPP), PPP Center of Excellence, PPP project development, and risk allocation
    JEL: G11 H43 H54 H63 R10 R40
    Date: 2013–10
  20. By: Mitsuyo ANDO (Faculty of Business and Commerce, Keio University)
    Abstract: This paper sheds light on domestic/international production networks in machinery industries and examines how the economic crisis and natural/technological disaster that Japan encountered in recent years affected the networks and trade, mainly from the viewpoint of Japan’s exports. More specifically, the paper first decomposes changes in machinery exports into extensive and intensive margins and then examines the probability of trade declines and recoveries, using a logit estimation, in order to capture the natures of international production/distribution networks under the crises, i.e., the 2008-2009 Global Financial Crisis (GFC) and the 2011 Great East Japan Earthquake (EJE). Discussion is also presented focusing on domestic activities as well as the impacts of the 2011 Thailand floods. Moreover, considering that the 2011 EJE is not only a natural disaster but also a technological disaster that seriously affected Japan’s agriculture and food exports, the impacts on their exports are investigated as well. Our analyses suggest that, regardless of whether demand shock or supply shock, the economic/natural disasters revealed the stability and robustness of production networks in machinery sectors, though their negative impacts are severe and transmitted through production networks at the beginning. At the same time, our analyses draw various policy implications from the experiences of these crises.
    Keywords: International production/distribution networks, economic crisis and natural/technological disaster, Japan
    JEL: F14 F23 L23
    Date: 2013–08
  21. By: von Grebmer, Klaus; Headey, Derek; Bene, Christophe; Haddad, Lawrence; Olofinbiyi, Tolulope; Wiesmann, Doris; Fritschel, Heidi; Yin, Sandra; Yohannes, Yisehac; Foley, Connell; von Oppeln, Constanze; Iseli, Bettina
    Abstract: The 2013 Global Hunger Index (GHI) report—the eighth in an annual series—presents a multidimensional measure of national, regional, and global hunger. It shows that the world has made some progress in reducing hunger since 1990, but still has far to go. The 2013 GHI report focuses on resilience in theory and in practice. The relief and development communities have long struggled to understand why some people fare better than others when confronting stresses or shocks. Given that world hunger remains “serious†according to the index, resilience-building efforts are much needed to help poor and vulnerable people cope with hunger seasons, droughts, and other natural and manmade disasters both short-term and long-term. Building resilience will involve boosting food and nutrition security. In order to achieve that goal, the humanitarian and development communities must work together.
    Keywords: Africa South of Sahara; Caribbean; CIS; Commonwealth of Independent States; South Asia; Southeast Asia; Latin America; Developing countries; Middle East; North Africa; OECD countries; India; East Africa; East Asia; Eastern Europe; Food availability; food crises; food crisis; food prices; food security; Global Hunger Index; GHI; Gross income; indicators; Children; Land; Land degradation; Nutrition; Malnutrition; Undernutrition; Hunger; Mortality; Natural resources; Climate change; Data; Policies; Poverty; property rights; smallholders; Stress; Sustainable development; sustainable livelihoods; transition economies; Undernutrition; Underweight; Water; resilience; natural disasters; disaster relief; environmental disasters; emergencies; environmental shocks; environmental risks
    Date: 2013
  22. By: Allen Yu-Hung LAI (The Institute of Health Economics and Management, ESSEC Business School - Asia Pacific); Seck L. Tan (National University of Singapore)
    Abstract: Singapore is vulnerable to both natural and man-made disasters alongside its remarkable economic growth. One of the most significant disasters is the Severe Acute Respiratory Syndrome (SARS) epidemic in 2003. The SARS outbreak was eventually contained through a series of risk mitigating measures introduced by the Singapore government. This would not be possible without the engagement and responsiveness of the general public. This paper begins with a description of Singapore’s historical disaster profiles, the policy and legal framework in the all-hazard management approach. We use a case study to highlight the disaster impacts and insights drawn from Singapore’s risk management experience with specific references to the SARS epidemic. We draw on the lesson-learning from Singapore’s experience in fighting the SARS epidemic, and discuss implications for future practice and research in disaster risk management. The implications are explained in four aspects: staying vigilant at the community level, remaining flexible in a national command structure, the demand for surge capacity, and collaborative governance at regional level. This paper concludes with a presence of the flexible command structure on both the way and the extent it was utilized. This helps to explain the success level of the containment of the SARS epidemic.
    Keywords: Disaster risk, SARS, epidemics, infectious disease, Singapore
    JEL: Q54 Q52 O53
    Date: 2013–08
  23. By: H. T. Tran; E. Santarelli
    Abstract: This paper investigates the determinants of innovative activities and the innovation-performance relationship for the firm population in Vietnam in three consecutive stages: decision – investment – outcome. Cragg’s two-tiered dynamic type-2 Tobit model and instrumental variable GMM method are applied to control for the selectivity and endogeneity of R&D and innovation. After controlling for ownership types, industry and regional fixed-effects, key findings include: (i) R&D and innovation activities not only stimulate firms’ profitability and growth of sales, but also increase their survival propensity; (ii) private innovative firms significantly outperform their peers whereas the combination of young, small, and innovative characteristics in young innovative companies (YICs) does not bring the expected higher entrepreneurial performance as how it works in advanced countries; (iii) highly-leveraged firms, exporting firms, and diversified firms are more likely to be innovative than their counterparts, but the ability to transform innovative efforts into higher profitability and growth can only be witnessed among diversified firms; and (iv) firms being endowed with larger asset pool have more favorable conditions to engage in innovation activities, but do not necessarily produce superior performance relatively to their smaller counterparts. However, firm labor size is positively associated with both R&D intensity and entrepreneurial performance of firms. The dataset of population of existing firms (from 2000 to 2005) extracted from the annual enterprise survey conducted by Vietnam General Statistics Organization (GSO) is used for the empirical analysis.
    JEL: O32 O33 O53 L25
    Date: 2013–10
  24. By: Sann VATHANA (Council for Agrictultural and Rural Development, Social Protection Coordination Unit, Cambodia (CARD-SPCU)); Sothea OUM (Economic Research Institute for ASEAN and East-Asia (ERIA)); Ponhrith KAN (CARD-SPCU); Colas CHERVIER (CARD-SPCU)
    Abstract: The pattern of risks faced by the poor and vulnerable in rural areas of Cambodia, as a consequence of natural disaster, is posing an increasing threat to their livelihoods. One third of the past three years has been taken up either with flooding or with drought, and the drought periods were more prolonged than the floods. The damage caused by flood and drought was comparable, although the flood of 2011 was the most extensive of the disasters. This paper presents impacts of disasters on household welfare and the linking of social protection interventions to address the entitlement failure of poor and vulnerable people suffering from the impacts of flood and drought. There is a strong need at the policy level to design social protection interventions to emphasize ex-ante instruments rather than the ex post response to natural disasters as focusing on emergency assistance and relief. Cash transfers programs provide direct assistance in the form of cash to the poor. Ex-ante cash transfer programs can play a crucial role in encouraging poor households to invest in business rather than spending on food. Microfinance schemes can also help ex-ante income diversification that can bolster households against widespread natural disasters.
    Keywords: Natural disaster, Entitlement failure
    JEL: Q54 I31 H55 O53
    Date: 2013–08
    Abstract: We propose a new technique for identication and estimation of aggregation functions in multidimensional evaluations and multiple indicator settings. These functions may represent \latent" objects. They occur in many dierent contexts, for instance in propensity scores, multivariate measures of well-being and the related analysis of inequality and poverty, and in equivalence scales. Technical advances allow nonparametric inference on the joint distribution of continuous and discrete indicators of well-being, such as income and health, conditional on joint values of other continuous and discrete attributes, such as edu- cation and geographical groupings. In a multiattribute setting, \quantiles" are \frontiers" that dene equivalent sets of covariate values. We identify these frontiers nonparametrically at rst. Then we suggest \parametrically equivalent" characterizations of these frontiers that reveal likely weights for, and substitutions between dierent attributes for dierent groups, and at dierent quantiles. These estimated parametric functionals are \ideal" ag- gregators in a certain sense which we make clear. They correspond directly to measures of aggregate well-being popularized in the earliest multidimensional inequality measures in Maasoumi (1986). This new approach resolves a classic problem of assigning weights to multiple indicators such as dimensions of well-being, as well as empirically incorporating the key component in multidimensional analysis, the relationship between the indicators. It introduces a new way for robust estimation of \quantile frontiers", allowing \complete" assessments, such as multidimensional poverty measurements. In our substantive applica- tion, we discover extensive heterogeneity in individual evaluation functions. This leads us to perform robust, weak uniform rankings as aorded by tests for multivariate stochas- tic dominance. A demonstration is provided based on the Indonesian data analyzed for multidimensional poverty in Maasoumi & Lugo (2008).
    Date: 2013–08
  26. By: Kleimeier S.; Dinh T.H.T.; Straetmans S.T.M. (GSBE)
    Abstract: Adverse selection inherent in the bank-borrower relationship typically intensifies during crises. This problem is expecially severe in emerging markets, characterized by weak institutions and banks with poorly developed monitoring and screening abilities. Exploiting a unique sample of Vietnamese loans, we show that by updating their credit scoring models banks can significantly improve their screening abilities. Our results suggest that a crisis fundamentally changes default patterns and that a model based on post-crisis data outperforms models based on pre-crisis data. We conclude that updating credit scoring models is a viable alternative to credit rationing for banks and, in combination with relationship lending, can lead to improved loan pricing, efficiency and profitability.
    Keywords: Financial Markets and the Macroeconomy; Banks; Depository Institutions; Micro Finance Institutions; Mortgages; Economic Development: Financial Markets; Saving and Capital Investment; Corporate Finance and Governance;
    JEL: E44 G21 O16
    Date: 2013

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