nep-sea New Economics Papers
on South East Asia
Issue of 2014‒06‒28
ten papers chosen by
Kavita Iyengar
Asian Development Bank

  1. Reform of the Indonesian Civil Service: Racing with Decentralization By Prijono Tjiptoherijanto
  2. On Path-Dependent Structured Funds: Complexity Does Not Always Pay (Asian versus Average Performance Funds) By Philippe Bertrand; Jean-luc Prigent
  3. Welfare dynamics measurement : two definitions of a vulnerability line and their empirical application By Dang , Hai-Anh H.; Lanjouw, Peter F.
  4. Exchange Rate Regimes and Business Cycles: An Empirical Investigation By Fatma Pinar Erdem; Erdal Ozmen
  5. Can religion buy happiness? The case of Singapore By Salahodjaev, Raufhon
  6. IDEAL Inference on Conditional Quantiles via Interpolated Duals of Exact Analytic L-statistics By David Kaplan
  7. Trying to Understand the PPPs in ICP2011: Why are the Results so Different? By Angus Deaton; Bettina Aten
  8. Benchmarking public policy : methodological insights from measurement of school based management By Parandekar, Suhas D.
  9. The Nexus between Antidumping Petitions and Exports during the Global Financial Crisis: Evidence on the People’s Republic of China By Lin, Faqin; Tang, Hsiao Chink; Wang, Lin
  10. Economic and Political Transitions from Premodern to Modern States in the Meiji Restoration and Xinhai Revolution: A Strategic Approach By Aoki, Masahiko

  1. By: Prijono Tjiptoherijanto (Department of Economics, Faculty of Economics, University of Indonesia)
    Abstract: Important aspects toward restoring trust in government among others is the role of leadership inbuilding the credibility of reforms implemented after 1988 in Indonesia. Since the Reformation Era which the objectives are improving democratic and local governance, moving governance closer to the people, and strengthening transparency and accountability of the government, the role of bureaucracy; with respect to civil services; is very important in developing a modern and efficient government system.
    Keywords: decentralisation civil service commission, pay system
    JEL: D73
    Date: 2014–01
  2. By: Philippe Bertrand; Jean-luc Prigent
    Abstract: As emphasized by the U.S. Dodd-Frank Act and the European MiFID directive, financial institu-
    Keywords: Structured financial products; portfolio insurance; Asian options; average of calls; Kappa measures.
    JEL: G11 G13 G21 D03
    Date: 2014–06–16
  3. By: Dang , Hai-Anh H.; Lanjouw, Peter F.
    Abstract: Little research currently exists on a vulnerability line that distinguishes the poor population from the population that is not poor but that still faces significant risk of falling back into poverty. This paper attempts to fill this gap by proposing vulnerability lines that can be straightforwardly estimated with panel or cross-sectional household survey data, in rich- and poor-country settings. These vulnerability lines offer a means to broaden traditional poverty analysis and can also assist with the identification of the middle class or resilient population groups. Empirical illustrations are provided using panel data from the United States (Panel Study of Income Dynamics) and Vietnam (Vietnam Household Living Standards Survey) for the period 2004-2008 and cross-sectional data from India (National Sample Survey) for the period 2004-2009. The estimation results indicate that in Vietnam and India during this time period, the population living in poverty and the middle class have been falling and expanding, respectively, while the opposite has been occurring in the United States.
    Keywords: Rural Poverty Reduction,Regional Economic Development,Population Policies,Inequality
    Date: 2014–06–01
  4. By: Fatma Pinar Erdem (Central Bank of the Republic of Turkey); Erdal Ozmen (Department of Economics, METU)
    Abstract: This paper investigates the impacts of domestic and external factors along with exchange rate regimes on business cycles in a large panel of advanced and emerging market economies by employing panel logit, cointegration and autoregressive distributed lag model estimation procedures. The results for classical business cycles suggest that emerging market economies tend to experience much deeper recessions and relatively steeper expansions during almost the same duration. The probability of expansions significantly increases with exchange rate regimes flexibility. Our results, different from the bipolar view, strongly support exchange rate regime flexibility for both AE and EME other than the East Asian countries. The impacts of external real and financial shocks and domestic variables are significantly greater under managed regimes as compared to floats. Our results strongly suggest that the evolution and determinants of both classical business and growth cycles are not invariant to the prevailing exchange rate regimes.
    Keywords: Business cycles, Exchange rate regimes, Emerging markets.
    JEL: C33 E32 F33 F41
    Date: 2014–06
  5. By: Salahodjaev, Raufhon
    Abstract: This paper investigates the determinants of life satisfaction in Singapore. Specifically we explore the effect of religiosity on life satisfaction. Using World Values Survey data, we find that in general religiosity leads to higher levels of life satisfaction. However, we do not find link between religious denomination and subjective wellbeing, except for Muslim and other religious denomination i.e. Taoist and Shenism.
    Keywords: well-being, life satisfaction, religiosity, Singapore, trust
    JEL: I0 I00
    Date: 2014–06–01
  6. By: David Kaplan (Department of Economics, University of Missouri-Columbia)
    Abstract: The literature has two types of fractional order statistics: an `ideal' (unobserved) type based on a beta distribution, and an observable type linearly interpolated between consecutive order statistics. From the nonparametric perspective of local smoothing, we examine inference on conditional quantiles, as well as linear combinations of conditional quantiles and conditional quantile treatment effects. This paper develops a framework for translating the powerful, high-order accurate IDEAL results (Goldman and Kaplan, 2012) from their original unconditional context into a conditional context, via a uniform kernel. Under mild smoothness assumptions, our new conditional IDEAL method's two-sided pointwise coverage probability error is O(n-2/(2+d)), where d is the dimension of the conditioning vector and n is the total sample size. For d ≤ 2, this is better than the conventional inference based on asymptotic normality or a standard bootstrap. It is also better for other d depending on smoothness assumptions. For example, conditional IDEAL is more accurate for d = 3 unless 11 or more derivatives of the unknown function exist and a corresponding local polynomial of degree 11 is used (which has 364 terms since interactions are required). Even as d → ∞, conditional IDEAL is more accurate unless the number of derivatives is at least four, and the number of terms in the corresponding local polynomial goes to infinity as d → ∞. The tradeoff between the effective (local) sample size and bias determines the optimal bandwidth rate, and we propose a feasible plug-in bandwidth. Simulations show that IDEAL is more accurate than popular current methods, significantly reducing size distortion in some cases while substantially increasing power (while still controlling size) in others. Computationally, our new method runs much more quickly than existing methods for medium and large datasets (roughly n ≥ 1000). We also examine health outcomes in Indonesia for an empirical example.
    Keywords: fractional order statistics, nonparametric statistics, quantile inference, quantile treatment effect
    JEL: C01 C12 C21
    Date: 2013–09–05
  7. By: Angus Deaton; Bettina Aten
    Abstract: The 2011 round of the International Comparison Program (ICP) has published a set of purchasing power parities (PPPs) that are sharply different from those that were expected from extrapolation of the 2005 round. In particular, the world in 2011 looks sharply more equal than previously calculated, because consumption and GDP in most poor countries were revised upward relative to the U.S. and other rich countries. Here we attempt to find out what happened. It is first noted that the 2005 round was itself sharply different from what was then expected, and made the world much less equal. We argue that the 2011 round is superior to the 2005 round, and that many of the changes in 2011 undo what happened in 2005. We identify a likely source of the problem, which is the way that the regions of the ICP were linked in 2005. We use two different methods for measuring the size of the effect. Both suggest that the 2005 PPPs for consumption for countries in Asia (excluding Japan), Western Asia, and Africa were overstated by between 20 to 30 percent. If these results are correct, they call for substantive backward revision of international comparisons, as well as estimates of global poverty and inequality.
    JEL: E01 F00 O11 O47
    Date: 2014–06
  8. By: Parandekar, Suhas D.
    Abstract: This working paper presents a benchmarking analysis of School Based Management (SBM) using empirical data from the Philippines. School based management is widely used as a policy tool in many countries that seek to improve the quality of service delivery through decentralization. School based management typically takes many years to have an impact on educational outcomes, but policy makers need to know sooner how well the policy is being implemented. The paper extends the well-known Rasch methodology from the literature on student achievement, including the Programme for International Student Assessment, to the measurement of the implementation of school based management by computing a Rasch measure of the implementation of school based management. To test whether the resulting benchmarked measure is plausible and has practical policy value, the measure is tested for correlations with standardized measures of personality and political skills of school principals, developed in the psychology and political science literatures. The paper will be useful for readers interested in studying school based management as well as those interested more generally in the methodology of benchmarking implementation of public policy where the ultimate results are subject to long implementation periods. The methodology presented in this paper can be applied to enhance the rigor of the ongoing Systems Approach for Better Education Results (SABER) exercise to benchmark educational policies in various domains. That exercise is set to become one of the flagship policy analytical tools being developed by the World Bank and partner agencies.
    Keywords: Tertiary Education,Education For All,Primary Education,Teaching and Learning,Educational Sciences
    Date: 2014–06–01
  9. By: Lin, Faqin (School of International Trade and Economics); Tang, Hsiao Chink (Asian Development Bank); Wang, Lin (Institute of Economics of the Chinese Academy of Social Sciences)
    Abstract: This paper quantifies how the People’s Republic of China’s (PRC) export volume to its major trading partners during the global financial crisis affects the antidumping (AD) petitions filed by the trading partners against the PRC. Focusing on the AD petitions at the Harmonized System (HS) Code 8-digit level and the PRC’s exports at the HS 2-digit level, we construct three instrument variables at the same HS level for export volume. These instruments—documents required, time taken, and container charges incurred for goods traded across borders—represent trade costs obtained from the World Bank’s Doing Business Project. We find rising exports from the PRC lead to rising AD petitions against the country. Instrumental variable estimates indicate that a 1 percentage point rise in the PRC’s export volume raises the number of AD petitions against the country by about 0.3 percentage point, and the probability of receiving AD petitions by 3.6 %. These estimates are about 10 times larger than those found in ordinary least square regressions. Their quantitative significance underlines why it is important to consider the issue of export endogeneity in the estimation. Moreover, it highlights the failure of the current trade statistics to account for the true value-added of traded goods, and how this has particularly disadvantaged the PRC, given its position as the factory of the world.
    Keywords: International trade; antidumping; instrument variable; People’s Republic of China
    JEL: F13 F14 F59
    Date: 2014–05–01
  10. By: Aoki, Masahiko (Asian Development Bank Institute)
    Abstract: Economists often identify a reduction in the share of agricultural employment as a quantitative indication of the economic growth of nations. But this process did not occur in earnest in the People’s Republic of China until the 1980s and to some extent in Japan until well into the mid-20th century. Were extractive political regimes, commonly regarded as the primary drivers of economic performance, solely responsible for the lateness of these developments? This paper deals with this question from a strategic perspective by examining the interactions between the polity and the economy in both countries. It begins by characterizing the complementary nature of the peasant-based economy and the agrarian-tax state in premodern China and Japan. It then describes how endogenous strategic forces evolved from among the intermediate organizations in each country to challenge the incumbent dynastic ruler in response to the commercialization of the peasant-based economy on one hand and the fiscal and military weakening of the agrarian-tax state on the other. The paper then introduces a three-person game model between a ruler and two challenging organizations, and derives conditions for multiple equilbria and their comparative static. The analytical results help to identify the endogenous strategic forces that led the Meiji Restoration and the Xinhai Revolution to move from a premodern state of play to nation-state building and modern economic regimes in each country.
    Keywords: endogenous institutional change; institutional complementarity; Chinese economy; Meiji Restoration; tax state; peasant-based economy; three person politico-economic game
    JEL: B52 C72 N40 N45 O10 P51
    Date: 2014–06–19

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