nep-sea New Economics Papers
on South East Asia
Issue of 2015‒02‒22
twenty-six papers chosen by
Kavita Iyengar
Asian Development Bank

  1. Scaling Up Payments for Forest Environmental Services in Viet Nam: Lessons and Insights from Quang Nam By Asian Development Bank (ADB); ; ;
  2. The political economy of industrial development in Vietnam: Impact of state-business relationship on industrial performance, 1986-2012 By Vu-Thanh, Tu-Anh
  3. Employment, Earnings and Social Protection for Female Workers in Vietnam’s Informal Sector By Nguyen, Duy Loi; Nguyen, Binh Giang; Tran, Thi Ha; Vo, Thi Minh Le; Nguyen, Dinh Ngan
  4. Impact Evaluation of Development Programmes and Policies: Experiences from Viet Nam By Nguyen Viet Cuong
  5. 2013 Clean Energy Investments: Project Summaries By Asian Development Bank (ADB); ; ;
  6. The role of information communication technology policies in economic development: A comparison of select Asian countries By Pereira, Francis
  7. Natural Disasters and Labour Markets By Martina Kirchberger
  8. The practice of industrial policy: Lessons for Africa: Co-ordination through an Asian lens By Lin, Justin Yifu; Vu, Khuong Minh
  9. Cost and impact analysis of sea level rise on coastal Vietnam By Chinowsky, Paul S.; Schweikert, Amy E.; Strzepek, Niko L.
  10. Impact of Free Trade Agreements on Trade in East Asia By Misa OKABE
  11. Are Comparisons Luxuries? Subjective Poverty and Positional Concerns in Indonesia By Jinan Zeidan
  12. The role of issue linkage in managing the Mekong By Pham Do, Kim Hang
  13. Conspicuous Consumption and Peer Effects among the Poor: Evidence From a Field Experiment By Christopher P. Roth
  14. Wage dynamics, turnover, and human capital : evidence from adolescent transition from school to work in the Philippines By Yamauchi, Futoshi
  15. Towards an Enabling Set of Rules of Origin for the Regional Comprehensive Economic Partnership By Erlinda M. MEDALLA
  16. Rice Price, Job Misery, Hunger Incidence: Need to Track Few More Statistical Indicators for the Poor By Mapa, Dennis S.; Castillo, Kristelle; Francisco, Krizia
  17. Updated Death and Injury Rates of U.S. Military Personnel During the Conflicts in Iraq and Afghanistan: Working Paper 2014-08 By Matthew Goldberg
  18. The Power of Transparency: Information, Identification Cards and Food Subsidy Programs in Indonesia By Abhijit Banerjee; Rema Hanna; Jordan C. Kyle; Benjamin A. Olken; Sudarno Sumarto
  19. Predation, Taxation, Investment, and Violence: Evidence from the Philippines By Berman, Eli; Felter, Joseph; Kapstein, Ethan; Troland, Erin
  20. The Labor Market Effects of Skill-biased Technological Change in Malaysia By Mohamed Ali Marouani; Björn Nilsson
  21. Business Licensing: A Key to Investment Climate Reform By Lili Yan ING
  22. It worked in China, so why not in Africa? The political economy challenge of Special Economic Zones By Farole, Thomas; Moberg, Lotta
  23. Capturing ecosystem service opportunities: A practice-oriented framework for selecting economic instruments in order to enhance biodiversity and human livelihoods By Rode, Julian; Wittmer, Heidi; Emerton, Lucy; Schröter-Schlaack, Christoph
  24. Musings on the Social Discount Rate By Arnold C. Harberger; Glenn P. Jenkins
  25. Shrinkage Estimation of Dynamic Panel Data Models with Interactive Fixed Effects By Xun Lu; Su Liangjun
  26. Accuracy and efficiency of various GMM inference techniques in dynamic micro panel data models By Jan F. Kiviet; Milan Pleus; Rutger Poldermans

  1. By: Asian Development Bank (ADB); (Southeast Asia Department, ADB); ;
    Abstract: The Asian Development Bank (ADB) supported the provincial authorities of Quang Nam in Viet Nam to scale up the implementation of payments for forest environmental services (PFES) through a technical assistance financed by the Governments of Sweden and Norway. The project pilot-tested two innovations— the group approach and the use of a geographic information system—to speed up PFES planning and implementation in the province. Starting with five villages in Ma Cooih commune, the initiative expanded to include two more communes in the Song Bung 4 watershed. This publication shares lessons and insights gained from this experience, and with it ADB intends to contribute to developing a robust, affordable, and sustainable process of planning and implementing PFES at the provincial level, thereby helping accelerate its implementation.
    Keywords: adb, asian development bank, asdb, asia, pacific, poverty asia, forest management, environmental financing, quang nam, vietnam, forestry economics, vietnam forest administration, watershed vietnam, Ma Cooih commune, Ta Po commune, Cha Val commune, geographic information system vietnam
    Date: 2014–07
  2. By: Vu-Thanh, Tu-Anh
    Abstract: Vietnam.s industrial development since doi moi is a success, but only a partial one. This paper provides a political economy account of Vietnam.s industrial growth since 1986. It shows that the key determinant of Vietnam.s industrial growth lies in the re
    Keywords: state-business relationship, political economy, industrial development, Vietnam
    Date: 2014
  3. By: Nguyen, Duy Loi; Nguyen, Binh Giang; Tran, Thi Ha; Vo, Thi Minh Le; Nguyen, Dinh Ngan
    Abstract: The informal sector plays an important role in employment creation and poverty reduction among female laborers in Vietnam. Currently, around 70 percent to 80 percent of women in Vietnam work in the informal sector, of which about 60 percent are in the agriculture and 20 percent are in the non-agricultural sectors that are mostly affiliated with small-size production and service units. By investigating the employment, earnings, and social protection policy on female labor in Vietnam’s informal sector, this research is able to answer the following research questions: 1) How important is the role of female labor in the informal sector? 2) What are the important factors that influence job opportunities for women in the informal sector? 3) What are the policy implications on female labor in Vietnam's informal sector? 4) What are the causes of work insecurities among females in Vietnam's informal sector? 5) What areas of social protection are most needed by women workers? 6) How does one address these principal needs for social protection among female workers?
    Keywords: informal sector, labor market, social protection
    JEL: J70 O15 O17
    Date: 2014–04
  4. By: Nguyen Viet Cuong
    Abstract: Poverty reduction is one of major goals of development policy of most countries, especially developing ones. To reduce poverty, numerous development programmes have been implemented throughout the world. In recent decades, researchers as well as policy makers have been increasingly interested in impact evaluation of development programmes to improve the effectiveness of the programmes. Vietnam has been very successful in poverty reduction since the economic reform in 1986. The Government of Viet Nam, as well as international and domestic organisations, has implemented numerous targeted programmes to increase people’s welfare. Although increasing attention is paid to impact evaluation of programmes, well-designed impact evaluation of development projects remains very limited. This paper discusses experiences and difficulties in impact evaluation of development programmes in Viet Nam. The findings are expected to be relevant for not only Vietnam but also other developing countries, especially those with a similar socio-economic context as Vietnam.
    Keywords: impact evaluation, impact evaluation experiences, development programs, Vietnam.
    JEL: H43 H40 D04
    Date: 2015–02–10
  5. By: Asian Development Bank (ADB); (Regional and Sustainable Development Department, ADB); ;
    Abstract: This report summarizes the investments in clean energy made by the operations departments of the AsianDevelopment Bank (ADB) in 2013, condensing information from project databases and formal reports in an easy-to-reference format. This report was prepared by ADB’s Clean Energy Program which provides the cohesive agenda that encompasses and guides ADB’s lending and non-lending assistance, initiatives, and plan of action for sustainable growth in Asia and the Pacific.
    Keywords: clean energy, energy projects, adb projects, power sector rehabilitation, energy efficiency, solar power, adb operations, investments, sustainable growth, central and west asia department, east asia department, private sector operations department, south asia department, southeast asia department, project summary
    Date: 2014–06
  6. By: Pereira, Francis
    Abstract: While the role of telecommunication networks historically, and today broadband and the Internet, have been theoretically linked to economic growth, the empirical results have been mixed, giving rise again to the 'productivity paradox.' Many governments, particularly those in Southeast Asia, have adopted aggressive policies to deploy broadband networks and to encourage the use of these applications. These, governments are motivated to promote broadband adoption in order to realize both economic and social benefits. This paper argues that countries (or territories), specifically, Korean, Singapore and Hong Kong have been able to realize these because of the comprehensive and aggressive policies pursued by these governments. There is some evidence to suggest that these governmental policies have been successful in achieving their stated goals.
    Keywords: Broadband,National Information Infrastructure Policies,Foreign direct Investment
    Date: 2014
  7. By: Martina Kirchberger
    Abstract: While it is clear that natural disasters have serious welfare consequences for affected populations, less is known with respect to how local labour markets in low income countries adjust to such large shocks in particular the general equilibrium effects of the increase in the demand for construction as well as the inflow of resources in the aftermath of natural disasters.  Combining data from the Indonesia Famiy Life Survey, the Desinventar database, the US Geological Survey and district level employment indicators, this paper explores how a large earthquake in Indonesia affected local labour markets, in particular the evolution of wages and employment across sectors.  We find that wage growth in the agriculture sector is significantly higher in earthquake affected areas.  We propose two mechanisms for this result: a higher growth rate of the price of rice in agricultural communities which switch from being net sellers to net buyers of rice and a downward shift in the supply of workers in the agricultural sector.  We show evidence for both mechanisms.
    Keywords: Local labour markets, natural disasters
    JEL: J20 Q54 O10
    Date: 2014–05–01
  8. By: Lin, Justin Yifu; Vu, Khuong Minh
    Abstract: African countries are facing great opportunities but also formidable challenges in accelerating economic growth and sustaining a high level of economic performance. The experiences of East Asian countries may offer valuable insights for African leaders an
    Keywords: new structural economics, industrial policy, strategy, Asia, Africa
    Date: 2014
  9. By: Chinowsky, Paul S.; Schweikert, Amy E.; Strzepek, Niko L.
    Abstract: The Development under Climate Change research effort provides a basis for determining quantitative impacts on infrastructure from climate change. This paper provides results of an analysis of sea level rise impacts on road infrastructure in Vietnam. The s
    Keywords: Infrastructure, climate, vulnerability, resilience, adaptation
    Date: 2014
  10. By: Misa OKABE (Faculty of Economics, Wakayama University)
    Abstract: The number of bilateral and plurilateral free trade agreements (FTAs) in East Asia has increased rapidly after the 2000s behind the world trend of RTAs. Many studies tackled the challenge of figuring out the impact of FTAs in this region by applying various methodologies. The first half of this paper reviews empirical studies of ex-post evaluation of FTAs in East Asia. A look at earlier studies on the impact of the ASEAN Free Trade Area (hereafter AFTA), the first regional FTA in this region revealed that few studies found robust trade creation effects of AFTA in the 1990s. However, since the 2000s, several studies using detailed trade and tariff data on products or sectors indicate that tariff elimination under AFTA promoted regional trade among ASEAN countries. Recent studies also show tariff elimination is not necessarily the most important measure to promote trade in goods in the case of AFTA. Liberalisation measures--such as reduction of non-tariff measures, trade facilitation and coordination of rules of origin, and improvement of FTA usability--are more important measures to facilitate trade between members other than tariff elimination. Likewise, with regard to bilateral FTAs in East Asia, some ex-post evaluation studies show that these FTAs positively impact trade at some extent. These studies show that the positive impacts are brought not only by tariff elimination under the FTAs but also by other liberalisation measures. The latter half of this paper discusses a basic empirical analysis on the impact of five ASEAN+1 FTAs which have not yet been sufficiently investigated because of shortage of data. We found that trade creation effects of ASEAN-China FTA (ACFTA) and ASEAN-Korea FTA (AKFTA) appear in industrial supplies and capital goods between members. Also, trade in consumption goods is facilitated under ACFTA. On the other hand, the impact of ASEAN-Japan FTA (AJCEP) is not revealed in many cases. These results suggest that these regional FTAs potentiate the positive impact on trade when production and sales networks among members have already been developed. At the same time, the newer FTAs whose members are the same as precedent FTAs should set tariff elimination and other liberalisation measures at more liberalised level than precedent FTAs. From the perspective of effectiveness, the newer regional FTA in this region, such as the Regional Comprehensive Economic Partnership, needs to have a higher level of liberalisation and more inexpensive procedures for members to utilize said FTA than the existing ASEAN+1 FTAs in this region.
    Keywords: ASEAN Free Trade Area, ASEAN+1FTAs, RCEP
    JEL: F13 F14 F15
    Date: 2015–01
  11. By: Jinan Zeidan (Aix-Marseille University (Aix-Marseille School of Economics), CNRS & EHESS)
    Abstract: We explore (i) the usual determinants of happiness in Indonesia, with a special focus on the role of various measures of absolute income; (ii) the presence of relativistic concerns or positive external effects in shaping attitudes to subjective well-being; and (iii) whether this potential effect changes sign with income level. Additional evidence offered by our investigation relates to the effect of past income levels as well as to that of aspirations. In line with other literature from poor contexts, we find that the subjective well-being of Indonesians is positively affected by the comparison with the income of people around them. This positive influence is unambiguously more important for the poor than for the rich. This pattern is consistent through different measures of well-being and holds also when accounting for past income levels, and lagged income expectations.
    Keywords: Indonesia, subjective well-being, external effects, positional concerns
    JEL: O12 I30 I31
    Date: 2015–02
  12. By: Pham Do, Kim Hang
    Abstract: The Mekong River is the major water source in Southeast Asia and shared by six countries. There is a rush to acquire sources of alternative energy and other benefits to meet the growing demand for water and energy, while China and Myanmar have refused to
    Keywords: transboundary water resources, Mekong River Basin, externality games, issue linkage, cooperative solution
    Date: 2014
  13. By: Christopher P. Roth
    Abstract: I use a randomised conditional cash transfer program from Indonesia to provide evidence on peer effects in consumption of poor households.  I combine this with consumption visibility data from Indonesia to examine whether peer effects in consumption differ by a good's visibility.  In line with a model of conspicuous consumption, I find that the expenditure share of visible (nonvisible) goods rises (falls) for untreated households in treated sub-districts, whose reference group visible consumption is exogeneously increased.  Finally, I provide evidence on the mechanisms underlying the estimated spillovers using data on social interactions and social punishment norms.  In line with Veblen's (1899) claim that conspicuous consumption is more prevalent in societies with less social capital, I show that the peer effects in visible goods are larger in villages and for households with lower levels of social activities.
    Keywords: Conspicuous Consumption, Peer Effects, Relative Concerns, Spillovers, Social Interactions, Social Norms
    JEL: D12 C21 I38
    Date: 2015–02–04
  14. By: Yamauchi, Futoshi
    Abstract: This paper examines wage dynamics and turnover using tracking data of adolescents from the Philippines. The analysis uses individual test scores in grade 6 to proxy abilities. The empirical results show that (i) returns to labor market experience are large, nearly a half of the conventional estimate of returns to schooling; (ii) returns to experience are higher if educational attainment and/or test scores are higher; and (iii) ability, measured by test scores, positively influences the upgrading of occupations toward more skilled categories, although educational attainment plays an important role in determining the first occupation. The complementarity between schooling and experience is greater among good performers who show high test scores; education and ability augment gains from accumulating labor market experiences.
    Keywords: Labor Markets,Tertiary Education,Secondary Education,Educational Sciences,Teaching and Learning
    Date: 2015–01–01
  15. By: Erlinda M. MEDALLA (Senior Research Fellow, Philippines Institute of Development Studies)
    Abstract: With overlapping, multiple FTAs, such as the case of ASEAN and the various ASEAN+1 FTAs, complications could arise that run counter to the economic integration objectives of the East Asian Region. Forging the Regional Comprehensive Economic Partnership (RCEP) among ASEAN and its FTA partners is a next logical step. How facilitative the Rules of Origin (ROO) provisions are could prove crucial in maximizing the potential benefits. This paper revisits the nature of ROOs in ASEAN and the various ASEAN+1 FTAs to examine the surrounding constraints and issues as well as to provide recommendations on the beneficial set of ROOs for the RCEP and serve as inputs for policy makers and negotiators.
    Keywords: Rules of Origin, Regional comprehensive economic partnership
    JEL: F15
    Date: 2015–01
  16. By: Mapa, Dennis S.; Castillo, Kristelle; Francisco, Krizia
    Abstract: Reducing hunger incidence in the country is still the major policy challenge confronting our leaders today. Statistics on hunger produced by both government and private institutions show a very slow reduction in hunger incidence over the last five years. Official data from Philippines Statistics Authority (PSA) show the percentage of Filipinos experiencing extreme poverty (hunger) decreased only slightly from 10.9 percent of the population in 2009 to 10.4 percent in 2012 and increasing marginally to 10.7 percent during the 1st semester of 2013. The results of the 8th National Nutrition Survey (NNS) of 2013 conducted by the Food Nutrition and Research Institute (FNRI) show the same small reduction in the proportion of children aged 0-5 years who are underweight (indirect measure of hunger) from 20.7 percent in 2008 to 19.8 percent in 2013. Self-rated hunger incidence data from the Social Weather Stations (SWS) also reveal a similar bleak picture, where hunger incidence in households averaging at 19.5 percent in 2013 from 19.1 percent in 2009, slowing down slightly to an average of 18.3 percent in 2014. This slow reduction in hunger incidence is a puzzle considering the country’s respectable economic growth performance, with Real Gross Domestic Product (GDP) growing at an annual average of 6.3 percent during the period 2010-2014. This paper looks at the factors that influence the dynamic nature of hunger incidence in the Philippines using the data from the SWS quarterly surveys on hunger. Variables identified as potential determinants of hunger incidence are, among others, changes in the price of rice and job misery index (sum of the employment and unemployment rates). A Vector AutoRegressive (VAR) model is used to determine the effect of a shock to the possible determinants on total hunger. Results show that a shock (increase) in the price of rice at the current quarter tends to increase hunger incidence in the succeeding quarter. A shock (increase) in job misery index at the current quarter also increases the hunger incidence in the next quarter. Further analysis using the time-varying parameter (TVP) model shows a higher effect of changes in the price of rice to hunger incidence after the global rice crisis in 2008. This shows that hunger incidence is becoming very sensitive to changes in the price of rice.
    Keywords: Hunger Incidence, Vector AutoRegressive (VAR) model, State Space, Time-Varying Parameters (TVP) model
    JEL: C32 C51 I32 I38
    Date: 2015–02
  17. By: Matthew Goldberg
    Abstract: By Matthew Goldberg (CBO) In Operation Iraqi Freedom, which ended on August 31, 2010, some 3,482 hostile deaths occurred among U.S. military personnel and 31,947 people were wounded in action (WIA). More than 1,800 hostile deaths occurred during Operation Enduring Freedom (in Afghanistan and surrounding countries) through November 2014; about 20,000 more people were wounded in action. In the Iraq conflict, a larger proportion of wounded personnel survived their wounds than was the case during the Vietnam War, but the increased survival rates are not as high as some studies have asserted
    JEL: F52
    Date: 2014–12–17
  18. By: Abhijit Banerjee; Rema Hanna; Jordan C. Kyle; Benjamin A. Olken; Sudarno Sumarto
    Abstract: Can governments improve aid programs by providing information to beneficiaries? In our model, information can change how much aid citizens receive as they bargain with local officials who implement national programs. In a large-scale field experiment, we test whether mailing cards with program information to beneficiaries increases their subsidy from a subsidized rice program. Beneficiaries received 26 percent more subsidy in card villages. Ineligible households received no less, so this represents lower leakage. The evidence suggests that this effect is driven by citizen bargaining with local officials. Experimentally adding the official price to the cards increased the subsidy by 21 percent compared to cards without price information. Additional public information increased higher-order knowledge about eligibility, leading to a 16 percent increase in subsidy compared to just distributing cards. In short, increased transparency empowered citizens to reduce leakages and improve program functioning.
    JEL: D73 I38 O12
    Date: 2015–02
  19. By: Berman, Eli; Felter, Joseph; Kapstein, Ethan; Troland, Erin
    Keywords: The literature relating economic activity to political violence has greedy rebels (Collier, 2000) but not greedy governments. Yet capturing tax revenue might motivate governments to control territory, just as capturing extortion revenues motivates rebels. Panel data on political violence in the Philippines distinguish government from rebel attacks, which we link to private investment across 70 provinces. To formally explore these data we expand an established theory of asymmetric substate conflict –the “information-centric” model, by adding firms, investment, taxation and predation (i.e., extortionary violence by rebels in response to investment) to the interplay of government, rebels and civilians, generating testable implications. Necessary conditions for predation are sufficient to imply “tax capture” (i.e., violence by government in response to investment.) In the context of the expanded model, these results are consistent with tax capture and predation, and weigh against a dominant role for other mechanisms linking investment and violence, such as opportunity costs or a grievance-based mechanism. The data show that increases in investment predict increases in government attacks, as well as increases in rebel attacks. The “tax capture” response reverses in the following year., International Development, International Relations/Trade, Public Economics,
    Date: 2014–10
  20. By: Mohamed Ali Marouani (UMR « Développement et Société », IEDES / Université Paris1-Panthéon-Sorbonne, PSL, Université Paris-Dauphine, LEDa, IRD UMR DIAL); Björn Nilsson (PSL, Université Paris-Dauphine, LEDa, UMR DIAL)
    Abstract: (english) During the last half-century, the evolution of educational attainment among Malaysians has been spectacular, and current enrollment rates suggest this progression will continue, albeit at a slower pace. Such a transformation of the educational attainment of labor should bring about macroeconomic effects such as wage compression, sectoral shifts and/or high skill un- employment, unless compensatory mechanisms exist. This article examines the impact of this evolution using a dynamic general equilibrium model applied to Malaysia. We argue that skill biased technological change occurred in Malaysia in recent years, and permitted unemployment figures to remain low and skill premia not to sink, despite the shift in skill structure. We run a retrospective simulation, looking at how unemployment and wages would have reacted had skill biased technological change not been prevalent. We also simulate the effects of a restriction in the supply of education to understand the impact of recent educational policy in Malaysia. The results are fed to a microdata set using a microaccounting technique, addressing distributional concerns. Our results show that the reduction in wage inequalities could have been substan- tially more important had skill biased technological change not been present. Furthermore, they suggest that the open-door higher education policy has contributed heavily to a reduction in wage inequalities. _________________________________ (français) Depuis plusieurs décennies, l’évolution des dotations éducationnelles des malaisiens a été spectaculaire, et les taux de scolarisation actuels indiquent que cette tendance va se poursuivre. Une telle transformation des dotations éducationnelles des travailleurs devraient engendrer des effets macroéconomiques tels qu’une compression des salaires, des glissements sectoriels et une hausse du chômage des qualifiés, en l’absence de mécanismes compensatoires. Cet article examine l’impact d’une telle évolution en utilisant un modèle d’équilibre général dynamique appliqué à la Malaisie. Nous affirmons qu’un progrès technique biaisé en faveur du travail qualifié a été présent en Malaisie dans la période récente, permettant des taux de chômage des qualifiés à rester bas et les rapports salariaux à ne pas baisser, malgré l’évolution de la structure des dotations. Nous faisons une simulation rétrospective, examinant les effets potentiels sur le chômage et les salaires en l’absence du biais du progrès technique. Nous simulons également une restriction de l’offre d’éducation pour comprendre l’impact de la politique de formation récente en Malaisie. Les résultats sont injectés dans une base de microdonnées utilisant une technique de microsimulation. Les résultats montrent que la réduction des inégalités salariales aurait pu être plus forte en l’absence du progrès technique biaisé. Ils suggèrent en outre que la politique éducative généreuse a fortement contribué à une réduction de ces inégalités.
    Keywords: Skills acquisition, CGE, Education and the Labor Market, Technological change, Acquisition de compétences, EGC, Education et marché du travail, progrès technique.
    JEL: E17 I28 E24 H52 O30 O53
    Date: 2014–12
  21. By: Lili Yan ING (Economic Research Institute for ASEAN and East Asia (ERIA) and University of Indonesia)
    Abstract: Reforming business licensing is a key starting point for improving the investment climate. Complex licensing procedures may encourage firms to remain unregistered, giving rise to difficulties later in accessing finance from formal financial institutions and constraining productivity and expansion. Across sectors, this can suppress the establishment of new firms and therefore the creation of new jobs, dragging down overall economic growth. Improving and reforming business licensing can significantly increase the number of businesses and thus help nurture employment creation. Several quick-win interventions are possible. First, there is a need to improve the quality of the business licensing website and help desk. The website and help desk should act as a frontline in dealing with investment regulations and policies for investors. Improvements should cover both hard and soft infrastructure of the website and help desk, including the skills of officials. Second, business license simplification should be continued by limiting licenses to those that serve their objective and cutting unnecessary licenses, and or consolidating licenses. Third, full implementation of electronic application and payment systems for business licenses should be fostered, together with increasing the nonfiscal incentives for firms to become registered. The registration system should also function as a nationwide database which could then be a source of reliable information both on firms and for firms, linked to government programs and grants, and business regulation updates. Fourth, a transparent system to show the progress of each business application should be set up, together with a recorded evaluation system in which users can provide feedback to improve the system. Finally, efforts in the medium term should focus on improving coordination among government agencies and clarifying the roles of central and local regulations, both horizontally and vertically
    Keywords: Investment Indonesia, Business, Licensing, Economic Reform
    JEL: F2 L6
    Date: 2015–02
  22. By: Farole, Thomas; Moberg, Lotta
    Abstract: African countries have sought to replicate the success of East Asia by implementing special economic zones. Despite decades of international experience, there remains no blueprint for successful special economic zone policies, and the majority of special
    Keywords: decomposition, Gini coefficient, inequality, Shapley.s value, Togo
    Date: 2014
  23. By: Rode, Julian; Wittmer, Heidi; Emerton, Lucy; Schröter-Schlaack, Christoph
    Abstract: Practitioners in the fields of sustainable development, land management, and biodiversity conservation are increasingly interested in using economic instruments that promise "win-win" solutions for conservation and human livelihoods. However, practitioners often lack guidance for selecting and implementing suitable economic approaches that take the specific local needs and the cultural, legal, and ecological context into account. This paper extracts from the academic debate a series of key aspects to be considered by practitioners who wish to accomplish change of behaviour via economic approaches. The paper then presents a practice-oriented framework for identifying the "ecosystem service opportunities" to conserve biodiversity and improve livelihoods in a specific local setting, and for pre-selecting suitable economic instruments. The framework is illustrated by describing its application in two pilot sites of the ECO-BEST project in Thailand, as part of which it was developed and road-tested.
    Keywords: conservation management,ecosystem services,economic instruments,assessment framework
    Date: 2015
  24. By: Arnold C. Harberger (University of California, Los Angeles, USA); Glenn P. Jenkins (Queen’s University, Canada and Eastern Mediterranean University, North Cyprus)
    Abstract: This paper is mainly concerned with weighted average measures of the social discount rate, where the components of the average are the marginal productivity of investment (measured by its gross-of-tax rate of return), and the marginal rate of time preference (measured by the net-of-tax yield of capital). We believe that these components should best be measured using data (the national accounts) that span the whole economy and reflect the product actually produced and the rewards actually perceived. We use a methodology based on just four familiar parameters to generate productivity estimates applicable to a wide range of countries. In the process, we make an adjustment for infrastructure investment, also excluding income from land, monopoly markups, supra-marginal returns due to TFP increases, and returns to capital in financial intermediation. The end products are estimates of social discount rates averaging around 8 percent for the advanced countries, and 10 percent for healthy developing countries and Asian Tigers.
    Keywords: Social discount rate, benefit-cost analysis, opportunity cost, time preference
    JEL: H43 D61
    Date: 2015–01
  25. By: Xun Lu (HKUST); Su Liangjun (Singapore Management University)
    Abstract: We consider the problem of determining the number of factors and selecting the proper regressors in linear dynamic panel data models with interactive fixed effects. Based on the preliminary estimates of the slope parameters and factors a la Bai and Ng (2009) and Moon and Weidner (2014a), we propose a method for simultaneous selection of regressors and factors and estimation through the method of adaptive group Lasso (least absolute shrinkage and selection operator). We show that with probability approaching one, our method can correctly select all relevant regressors and factors and shrink the coefficients of irrelevant regressors and redundant factors to zero. Further, we demonstrate that our shrinkage estimators of the nonzero slope parameters exhibit some oracle property. We conduct Monte Carlo simulations to demonstrate the superb finite-sample performance of the proposed method. We apply our method to study the determinants of economic growth and find that in addition to three common unobserved factors selected by our method, government consumption share has negative effects, whereas investment share and lagged economic growth have positive effects on economic growth.
    Keywords: Adaptive Lasso; Dynamic panel; Factor selection; Group Lasso; Interactive fixed effects; Oracle property; Selection consistency
    JEL: C13 C23 C51
    Date: 2015–02
  26. By: Jan F. Kiviet (Division of Economics, School of Humanities and Social Sciences, Nanyang Technological University, 14 Nanyang Drive, Singapore 637332;); Milan Pleus (Amsterdam School of Economics & Tinbergen Institute, University of Amsterdam, Valckenierstraat 65, 1018 XE Amsterdam, The Netherlands); Rutger Poldermans (Amsterdam School of Economics & Tinbergen Institute, University of Amsterdam, Valckenierstraat 65, 1018 XE Amsterdam, The Netherlands)
    Abstract: The performance in finite samples is examined of inference obtained by variants of the Arellano-Bond and the Blundell-Bond GMM estimation techniques for single dynamic panel data models with possibly endogenous regressors and cross-sectional heteroskedasticity. By simulation the effects are examined of using particular instrument strength enhancing reductions and transformations of the matrix of instrumental variables, of less robust implementations of the GMM weighting matrix, and also of corrections to the standard asymptotic variance estimates. We compare the root mean squared errors of the coefficient estimators and also the size of tests on coefficient values and of different implementations of overidentification restriction tests. Also the size and power of tests on the validity of the additional orthogonality conditions exploited by the Blundell-Bond technique are assessed over a pretty wide grid of relevant cases. Surprisingly, particular asymptotically optimal and relatively robust weighting matrices are found to be superior in finite samples to ostensibly more appropriate versions. Most of the variants of tests for overidentification restrictions show serious deficiencies. A recently developed modification of GMM is found to have great potential when the cross-sectional heteroskedasticity is pronounced and the time-series dimension of the sample not too small. Finally all techniques are employed to actual data and lead to some profound insights.
    Keywords: cross-sectional heteroskedasticity, Sargan-Hansen (incremental) tests, variants of t-tests, weighting matrices, Windmeijer-correction
    JEL: C12 C13 C15 C23 C26 C52
    Date: 2014–12

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