nep-sea New Economics Papers
on South East Asia
Issue of 2016‒06‒14
twenty-six papers chosen by
Kavita Iyengar
Asian Development Bank

  1. Emergence of Innovative Manufacturing Firms across Asian Countries By Singh, Lakhwinder; Gill, Anita
  2. Development in Southeast Asia’s lagging regions By Budy P Resosudarmo; Acram Latiph; Saran Sarntisart; Isra Sarntisart
  3. Open Educational Resources Enhancing: Education Provision and Practice By Asian Development Bank (ADB); Asian Development Bank (ADB); Asian Development Bank (ADB); Asian Development Bank (ADB)
  4. The affordability of the Sustainable Development Goals: A myth or reality? By Chongcharoentanawat, Patima; Haile, Kaleab; Kleine Deters, Bart; Kool, Tamara; Osei Kwadwo, Victor
  5. Climate Change, Dengue and the Economy: Ascertaining the Link Between Dengue and Climatic Conditions By Agustin L. Arcenas
  6. Demographic Change and Fiscal Sustainability in Asia By LEE Sang-Hyop; KIM Jungsuk; PARK Donghyun
  7. Social Security Reform and Economic Modeling Capacity Building in Indonesia By Asian Development Bank (ADB); Asian Development Bank (ADB); Asian Development Bank (ADB); Asian Development Bank (ADB)
  8. MCC Indonesia Nutrition Project Impact Evaluation Baseline Report By Clair Null; Amanda Beatty; Nick Ingwersen; William Leith; Evan Borkum; Jeremy Brecher-Haimson; Anna Gage; Matt Peckarsky; Anu Rangarajan
  9. Fossil Fuel Subsidies in Indonesia: Trends, Impacts, and Reforms By Asian Development Bank (ADB); Asian Development Bank (ADB); Asian Development Bank (ADB); Asian Development Bank (ADB)
  10. Impact of Safer Pesticide Use on the Health of Farmers--A Study from Vietnam By Tran Huynh Bao Chau; Le Thi Quynh Anh
  11. Integrated Information and Communication Technology Strategies for Competitive Higher Education in Asia and the Pacific By Asian Development Bank (ADB); Asian Development Bank (ADB); Asian Development Bank (ADB); Asian Development Bank (ADB)
  12. Survey of Children’s Access to Indecent Content via New Media: A Case Study from Thailand By Monwipa Wongrujira
  13. An Economic Analysis of Coral Reefs in the Andaman Sea of Thailand By Udomsak Seenprachawong
  14. Determinants to the existence of foreign firms in Vietnam By Daniel Rais
  15. Potentials and Constraints of Cambodian Rice Export By Thath, Rido
  16. Islamic Financing and Bank Behaviour in a Dual Banking System: Evidence from Malaysia By Zulkhibri, Muhamed
  17. Methods of the Water-Energy-Food Nexus By Aiko Endo; Kimberly Burnett; Pedcris M. Orencio; Terukazu Kumazawa; Christopher Wada; Akira Ishii; Izumi Tsurita; Makoto Taniguchi
  18. Investigating the Effect of U.S. Monetary Policy Normalization on the ASEAN-4 Economies By Willem THORBECKE
  19. China's economic growth and convergence By Jong-Wha Lee
  20. Service Innovation in Philippine Industries By Serafica, Ramonette B.
  21. Food Price, Firm Productivity and Market Structure in Indonesian Food and Beverages Industry By He, Xi
  22. On the integration of China's main stock exchange with the international financial market By Zhenxi Chen; Jan F. Kiviet; Weihong Huang
  23. Misallocation and Productivity: The Case of Vietnamese Manufacturing* By HA Doan Thi Thanh; KIYOTA Kozo; YAMANOUCHI KentaAuthor-Workplace-Name: Keio University
  24. Are there Bubbles in Exchange Rates? Some New Evidence from G10 and Emerging Markets Countries By Yang Hu; Les Oxley
  25. Agricultural Legacy, Individualistic Culture, and Techology Adoption By James B. Ang
  26. Groups, Norms and Endogenous Membership: Towards a Socially Inclusive Economics By Raul V. Fabella

  1. By: Singh, Lakhwinder; Gill, Anita
    Abstract: The recent phase of globalization has witnessed increasing influence of Asian countries in the global economy. This is supported by the rise of Asian firms and their increasing presence in economic activities across the globe through innovations in manufacturing. This paper attempts to trace the rise of Asian firms and their innovation capabilities while examining the theory of the growth of the firm and empirical literature. The comparative analysis of innovations across innovative manufacturing firms of seven Asian countries-Japan, South Korea, Malaysia, Indonesia, Philippines, China and India is based on data collected through Oslo manual approach survey conducted and compiled by UNESCO in 2013. This unique data set covers technological and social innovations which is more comprehensive and expands the scope of the concept of innovations. Important empirical evidence that has emerged from the analysis is that Asian manufacturing firms are having higher level of social innovations than technological innovations. Level of economic development is positively correlated to transition from process to product innovations across firms of both developed and developing countries. The low variations across active innovative firms in product and process innovations imply that technological innovations are stable and rising in Asia. This is supported by high degree of intensity of in-house R&D expenditure. The most important barrier to innovative and non innovative manufacturing firms is the deficiency of internal and external finances except firms of Japan and South Korea. The innovation environmental constraints are more visible across Asian firms where the national innovation system is at nascent phase. The finding based public policy suggestion is that the public policy should accord high priority in investing higher proportion of resources in innovations to relieve the firms from such constraints.
    Keywords: Systems of innovations, rise of Asian firms, technological innovations, social innovations, public policy, Asia, Manufacturing innovations, internationalization of firms.
    JEL: D2 D21 D7 L6 O1 O3
    Date: 2016–02–29
  2. By: Budy P Resosudarmo; Acram Latiph; Saran Sarntisart; Isra Sarntisart
    Abstract: This paper focuses on the three lagging Southeast Asia’s regions, namely the three Southern border provinces of Thailand, Mindanao in the Philippines and Papua in Indonesia. It aims to analyze and identify successful national and regional policies in these lagging regions. In particular, it will assess and compare the effectiveness of implementing higher fiscal transfers, local empowerment policies as well as regional autonomy strategies in these regions. The general conclusion of this paper is that providing a large amount of development funding and granting autonomous authority for these lagging regions is most likely required to enable these regions keep up with the development of other areas in their countries. Appropriate affirmative action policies are then needed to help solve the more detailed problems, such as urban-rural development and the gaps between the local and immigrant communities.
    Keywords: Development economics, lagging regions, regional autonomy, and fiscal policy
    JEL: O21 O23 O38 R58
    Date: 2016
  3. By: Asian Development Bank (ADB); Asian Development Bank (ADB) (Sustainable Development and Climate Change Department, ADB); Asian Development Bank (ADB) (Sustainable Development and Climate Change Department, ADB); Asian Development Bank (ADB)
    Abstract: Open educational resources made their appearance in early 2002 as a promising tool for enhancing the quality of and access to education and were perceived to have the potential to reduce costs by reusing learning materials. This brief draws on a study that reviewed the uptake of OERs and related activities in six institutions in Hong Kong, China; India; Malaysia; Pakistan; and Thailand.
    Keywords: education, information resources, electronic information resource, open educational resources, OER, free educational resources, education and OER, education and open educational resources
    Date: 2015–11
  4. By: Chongcharoentanawat, Patima (UNU‐MERIT, Maastricht University); Haile, Kaleab (UNU‐MERIT, Maastricht University); Kleine Deters, Bart (UNU‐MERIT, Maastricht University); Kool, Tamara (UNU‐MERIT, Maastricht University); Osei Kwadwo, Victor (UNU‐MERIT, Maastricht University)
    Abstract: Global governance in various forms has emerged as a salient means of setting and driving common development goals that are of interest to the world's functioning at large. However, literature is divided on the attribution of achievements to the global social governance efforts. The experience of the Millennium Development Goals (MDGs) showed the importance of setting indicators at an early stage to support a sound monitoring system. If the world is to start implementing the Sustainable Development Goals (SDGs) in 2016, we cannot afford a lag of several years before putting monitoring tools in place and measuring progress towards achieving these goals. To answer the question on the level of resources required to fulfil the SDGs target by country and income category, five low and lower middle income countries were selected from Asia, Africa, and Latin America based on availability of data and their classification as low and lower-middle income countries: Cambodia, El Salvador, Ethiopia, Indonesia, and Senegal. The required data for the assessment is sourced from the World Bank Development Indicators Databank (WDID). The estimation of the resource requirement to adhere to the poverty, health and education targets of the SDGs involves computing three indices for each dimension. For the income gap index, two poverty lines underlie the composite resource gap as percentage of the GDP to meet the SDGs targets on poverty. The education gap is constructed by normalising seven indices that either directly capture or proxy the governance and outcome targets on education in the SDGs. Thirdly, this research employed a three-step approach in estimating the normative public health expenditure gap; the staff expenditure gap; and the resource allocation expenditure gap. To conclude, the viability of closing the cumulative resource gap is assessed in light of a country's tax revenue.
    Keywords: Sustainable Development Goals, Millennium Development Goals, attribution, monitoring, fiscal stress, fiscal capacity, health, education, poverty, Cambodia, El Salvador, Ethiopia, Indonesia, Senegal
    JEL: O23 H21 E62 H51 H52 H53
    Date: 2016–05–17
  5. By: Agustin L. Arcenas (School of Economics, University of the Philippines Diliman)
    Abstract: This paper examines the climate-change related factors that affect the incidence of dengue in the Philippines. Dengue, one of the most high-profile public health problems in Southeast Asia, has been estimated to cost hundreds of millions of dollars in the Philippines and worldwide in terms of treatment, surveillance and control, lost income and other indirect costs per year. The disease has been a burden on the public, especially the poor who are less able to access funds for treatment and more heavily affected by the loss in income due to illness. The findings indicate that temperature, precipitation and the incidence of La Niña significantly contribute to the cases of dengue in the Philippines by enhancing the breeding, growth and development of the Aedis aegypti, the dengue-carrying mosquito variety. The econometric results also indicate that better household sanitation practices also reduce dengue cases, indicating that investments to enhance the public’s adoption of hygienic and other health practices do lessen the transmission of diseases such as dengue. The results of the study are consistent with the findings of studies regarding dengue in other parts of the world, and contribute to the growing awareness about the health impacts of climate change. This study should provide Philippine policy-makers some guidance in addressing the dengue problem as regional climate change becomes more pronounced.
    Keywords: Dengue, climate change La Niña
    JEL: Q54 I18
    Date: 2016–03
  6. By: LEE Sang-Hyop (East-West Center and University of Hawaii); KIM Jungsuk (Institute of International and Area Studies, Sogang University, Korea); PARK Donghyun (Asian Development Bank, Manila, Philippines)
    Abstract: Changes in the population age structure can have a significant effect on fiscal sustainability since they can affect both government revenue and expenditure. For example, population ageing will increase expenditure on the elderly while reducing potential growth and hence revenue. In this paper, we project government revenue, expenditure, and fiscal balance in developing Asia up to 2050. Using a simple stylised model and the National Transfer Accounts (NTA) data set, we simulate the effect of both demographic changes and economic growth. Rapidly ageing countries like the Republic of Korea, Japan, and Taiwan, are likely to suffer a tangible deterioration of fiscal sustainability under their current tax and expenditure system. On the other hand, rapid economic growth can improve fiscal health in poorer countries with relatively young populations and still growing working-age populations. Overall, our simulation results indicate that Asia’s population ageing will adversely affect its fiscal sustainability, pointing to a need for Asian countries to further examine the impact of demographic shifts on their fiscal health.
    Keywords: Fiscal projection, tax, public spending, fiscal balance, population ageing, Asia
    JEL: J11 J14 H20 H50 H62
    Date: 2016–03
  7. By: Asian Development Bank (ADB); Asian Development Bank (ADB) (Sustainable Development and Climate Change Department, ADB); Asian Development Bank (ADB) (Sustainable Development and Climate Change Department, ADB); Asian Development Bank (ADB)
    Abstract: While official poverty in Indonesia is relatively low at 12%, an additional 27% of the population live just above the poverty line and small shocks can drive them back into poverty.
    Keywords: social protection briefs, adb brief 46, indonesia social security, social security reform, sss, sjsn law, bpjs employment, bpjs health, social services, indonesia social protection, indonesia health care, pension, national health insurance, adb ta 7204, adb ta 8202
    Date: 2015–11
  8. By: Clair Null; Amanda Beatty; Nick Ingwersen; William Leith; Evan Borkum; Jeremy Brecher-Haimson; Anna Gage; Matt Peckarsky; Anu Rangarajan
    Abstract: The Millennium Challenge Corporation contracted with Mathematica Policy Research to conduct a rigorous randomized evaluation of the Indonesian Community-Based Health and Nutrition to Reduce Stunting Project, also known as the Nutrition Project, to understand the project’s effects on stunting and related key maternal and child health outcomes.
    Keywords: Indonesia, nutrition project, impact evaluation, baseline, international
    JEL: F Z
    Date: 2016–03–18
  9. By: Asian Development Bank (ADB); Asian Development Bank (ADB) (Economic Research and Regional Cooperation Department, ADB); Asian Development Bank (ADB) (Economic Research and Regional Cooperation Department, ADB); Asian Development Bank (ADB)
    Abstract: Subsidized energy is provided to all Indonesian citizens as a public service obligation. This study measures the size of fossil fuel subsidies such as underpricing of petroleum products and electricity, tax exemptions, and subsidized credit; examines the potential economic, energy, and environmental impacts of reducing them; and discusses options for social safety nets to mitigate the impacts of the reforms. It shows that the short-term adverse impacts of subsidy reform turn positive in the long term as households and industry respond to changing market realities by adjusting energy demand, supply, and production capacity. Policy options for sustainable energy use are provided to aid policymakers in their current subsidy reform process.
    Keywords: indonesia, fossil fuel, energy, fossil fuel subsidies, greenhouse gas emissions, energy use, economic impacts, social programs, developing asia
    Date: 2015–10
  10. By: Tran Huynh Bao Chau (College of Economics, Hue University); Le Thi Quynh Anh (College of Economics, Hue University)
    Keywords: impact, pesticide use, farmer, Vietnam
    Date: 2016–04
  11. By: Asian Development Bank (ADB); Asian Development Bank (ADB) (Sustainable Development and Climate Change Department, ADB); Asian Development Bank (ADB) (Sustainable Development and Climate Change Department, ADB); Asian Development Bank (ADB)
    Abstract: Early adoption of information and communication technology (ICT) can allow developing countries in Asia and the Pacific to move from labor-intensive, natural resources-based to knowledge-based economies. Higher education institutions must adopt an institution-wide, holistic ICT strategy, not a project-based approach, to avoid redundancies, obsolescence, and large maintenance costs. A coordinated top-down plus bottom-up intervention is best, with three areas requiring attention: infrastructure, application software, and staff development. ICT investments in higher education institutions in support of teaching, research, and community engagement are essential for developing and retaining competitive advantage in the knowledge economy.
    Keywords: education, information resources, electronic information resource, open educational resources, oer, free educational resources, education, open educational resources, jouko sarvi, hitendra pillay
    Date: 2015–12
  12. By: Monwipa Wongrujira (School of Communication Arts, Sukhothai Thammathirat Open University)
    Abstract: The research aims to study the new media usage of Thai children and youth, between 6-22 years old. A mixed research method was applied including: survey of 633 children and youth around Bangkok, selected by multi-stage sampling, and three focus groups of parents selected by purposive sampling. The results showed that smart phone was the most popular new media among children and youth. Their average time spending on new media was more than 4 hours per day, while a large portion of kids spent up to 10 hours per day. You Tube was the most popular social media among children and youth in every age. Online game was the most popular among small children, whereas Facebook was the most popular among youth. The main purposes of utilizing new media were entertainment, followed by chatting with friends and searching information. Most of the kids reported while going online they can easily and accidentally access to indecent contents, especially sexual content. Also, focus groups of the parents revealed that it became more difficult to control their children’s usage of new media while they grew up. Some children severely addicted to new media. Another main problem was less media and information literacy of parents. International study would be a lesson learned for policy makers in order to protecting children. Media and information literacy should be taken seriously for both parents and kids.
    Keywords: children, new media, media literacy, indecent content, Thailand
  13. By: Udomsak Seenprachawong (School of Economics, Sukhothai Thammathirat Open University)
    Abstract: The focus of this study is the valuation of coral reefs and how this information can be used to improve planning for coral reef management in Thailand. The site analysed, Phi Phi Islands, is rich in reef systems and is envisioned as an eco-tourism destination by government planners. Phi Phi can generate large economic values through recreation. The consumer surplus estimated by the travel cost method reveals an annual value of 8,216.4 million Baht (US$205.41 million). This study also utilised the contingent valuation method to estimate both the use and non-use values of Phi Phi’s coral reefs, representing an annual value of 19,895 million Baht (US$497.38 million). It is apparent from this analysis that both local and national levels of government in Thailand can justify larger annual budget allocations for managing coastal resources. At present, the economic benefits from coastal resource management in Phi Phi are mostly due to the local residents and businesses. One of the economic instrument options to capture the net benefit values of Phi Phi is to directly target the consumers. Tourists could be charged fees for physically using the environment, such as participating in offshore water sports (specifically including snorkelling boats and dive operations), swimming and beach activities. The contingent valuation method provided information regarding the extent of the domestic consumer surplus. It estimated the consumer’s willingness to pay to increase biodiversity at Phi Phi as 287 Baht (US$7.18) per visit.
    Keywords: Economic Analysis,Coral Reefs,Andaman Sea
    Date: 2016–04
  14. By: Daniel Rais
    Abstract: SECO Working Paper 14/2014 by Thi Thanh Binh Dinh
    Date: 2014–10–22
  15. By: Thath, Rido
    Abstract: Rice is one of the most important crops in Cambodia and its export becomes a significant source of employment and foreign exchange accumulation. In this study, the potentials and constraints of rice export are explored. Producers’ and export prices significantly influenced the volume of export. Given the export price, when the producers’ price is cheaper, export will increase. Export will also increase if export price increases while the producers’ price remains unchanged. In addition to the prices, factors that also affect the export of rice include the cost of transportation, access to finance, informal payment, access to the international market, quality of paddy, and business trust (trust among traders, trust between the rice trader and miller, and trust among the rice trader, miller and farmer).
    Keywords: Rice Export; Export Supply; Cambodia
    JEL: Q17 Q21
    Date: 2016–05–20
  16. By: Zulkhibri, Muhamed (The Islamic Research and Teaching Institute (IRTI))
    Abstract: Abstract The paper examines the cross-sectional differences in the way that Islamic banks respond to base financing rate across bank-specific characteristics in a dual banking system using panel regression methodology. The evidence suggests that the bank-specific characteristics are important for Islamic banking financing behaviour. The Islamic banks financing behaviour is consistent with behaviour of conventional banks that the bank lending operates via banks depending on the level of size, liquidity and capital. The findings also suggest that there is no significant difference between Islamic bank financing and conventional bank lending behaviour with respect to interest rates.
    Keywords: Islamic Banks; Base Financing Rate; Bank Financing; Panel Regression Analysis
    JEL: E44 E52 G21 G22
    Date: 2016–05–01
  17. By: Aiko Endo (Research Department, Research Institute for Humanity and Nature); Kimberly Burnett (University of Hawaii Economic Research Organization, University of Hawaii at Manoa); Pedcris M. Orencio (Catholic Relief Service Philippines (Manila Office) Urban Disaster Risk Reduction Department); Terukazu Kumazawa (Center for Research Promotion, Research Institute for Humanity and Nature); Christopher Wada (University of Hawaii Economic Research Organization, University of Hawaii at Manoa); Akira Ishii (Yachiyo Engineering Co., Ltd.); Izumi Tsurita; Makoto Taniguchi (Research Department, Research Institute for Humanity and Nature; Department of Cultural Anthropology, Graduate School of Arts and Sciences, The University of Tokyo)
    Abstract: This paper focuses on a collection of methods that can be used to analyze the water-energy-food (WEF) nexus. We classify these methods as qualitative or quantitative for interdisciplinary and transdisciplinary research approaches. The methods for interdisciplinary research approaches can be used to unify a collection of related variables, visualize the research problem, evaluate the issue, and simulate the system of interest. Qualitative methods are generally used to describe the nexus in the region of interest, and include primary research methods such as Questionnaire Surveys, as well as secondary research methods such as Ontology Engineering and Integrated Maps. Quantitative methods for examining the nexus include Physical Models, Benefit-Cost Analysis (BCA), Integrated Indices, and Optimization Management Models. The authors discuss each of these methods in the following sections, along with accompanying case studies from research sites in Japan and the Philippines. Although the case studies are specific to two regions, these methods could be applicable to other areas, with appropriate calibration.
    Keywords: water-energy-food nexus (WEF); integrated tools; integrated indices; benefit-cost analysis (BCA); optimization management models; integrated maps; ontology engineering; physical models; interdisciplinary; transdisciplinary
    Date: 2015–10
  18. By: Willem THORBECKE
    Abstract: U.S. monetary policy normalization is triggering capital outflows in the Association of South East Asian Nations (ASEAN). Using an event study, this paper reports that capital-intensive firms, the financial sector, and small firms in ASEAN are exposed to these outflows. Capital outflows also cause exchange rate depreciations that improve the price competitiveness of exports. To gauge this effect, this paper estimates price and income elasticities for ASEAN exports. The results indicate that a 10% exchange rate depreciation will increase ASEAN labor-intensive exports by 8%. ASEAN firms should use the tailwind provided by weaker exchange rates to increase exports.
    Date: 2016–05
  19. By: Jong-Wha Lee
    Abstract: This study explores China's economic growth performance and prospects in global and Asian comparative perspectives. Using a general framework of cross-country analysis, the study identifies and discusses major factors underlying China's strong growth over the past decades and those contributing to its recent growth slowdown. The study also adopts detailed industry-level data to assess structural changes and sectoral growth in the Chinese economy. China's low initial per capita income relative to its own long-run potential provided the opportunity for faster capital accumulation and technology diffusion. Good policy and institution factors, such as a high investment rate, strong human capital, high trade openness, and improved institutions, guided the economy to realize its strong potential for convergence to advanced economy income level. China's average potential GDP growth will decline significantly over the coming decade due to convergence effect and structural problems, unless China substantially upgrades institutions and policy factors and improves productivity, particularly in its services sector.
    Keywords: Economic growth, convergence, productivity, structural change, China
    JEL: O11 O14 O19 O47 O53 O57
    Date: 2016–05
  20. By: Serafica, Ramonette B.
    Abstract: This paper examines the evidence on service innovation using the 2012 Census of Philippine Business and Industry and the 2009 Pilot Survey of Innovation Activities. It reveals the wide variation in R&D intensities and differences in innovation behavior between the manufacturing and services sectors, for example, with respect to information sources and innovation activities. Many similarities were also detected in terms of service product innovation, the popularity of organizational innovation, and the preference for training activities, among others. Looking at structural factors, the probit regression analyses indicate that the size of the firm is a good determinant for all types of innovation. Ownership and age were also significant for certain innovation outputs, which could help inform policies on foreign direct investment and entrepreneurship. The results of this paper reveal the importance of service innovation not only for the services sector but also for the manufacturing sector consistent with servicification. In general, different types of innovation are undertaken by industries for various reasons, and the technological and nontechnological forms of innovation complement each other. If the government aims to promote economy-wide upgrading, support for innovation should not favor only one type of innovation output or activity. Further research on innovation behavior to cover more industries will be useful in developing a comprehensive and more nuanced approach to innovation policy.
    Keywords: Philippines, services, research and development (R&D), innovation, manufacturing, servicification
    Date: 2016
  21. By: He, Xi
    Keywords: Food Security and Poverty, Industrial Organization,
    Date: 2016–05–25
  22. By: Zhenxi Chen (Faculty of Economics, Business and Social Sciences, Christian-Albrechts University, Olshausenstrasse 40, 24118 Kiel, Germany); Jan F. Kiviet (Amsterdam School of Economics, University of Amsterdam, PO Box 15867, 1001 NJ Amsterdam, The Netherlands); Weihong Huang (Division of Economics, Nanyang Technological University, 14 Nanyang Drive, Singapore 637332.)
    Abstract: Extending published bivariate analyses on the revenues at the stock markets of New York and Shanghai by a tri-variate analysis, which also includes the Hong Kong stock market, we demonstrate that bivariate inferences on co-movement are highly fragile. In fact, rather common opinions like "China's stock market has become more and more integrated to the world market in the past twenty years" can easily be refuted. We do so also by demonstrating that the statistical findings from various earlier analyses are internally inconsistent. A rather straight-forward analysis based on standard and partial correlations over a running window, which does not pretend to unveil causality, indicates that although the Hong Kong market shows substantial though varying co-movement with both the New York and the Shanghai markets, an apparent systematically intensifying direct link between New York and Shanghai has not emerged yet.
    Keywords: China, Co-movement, Globalization, Specification analysis, Stock markets.
    JEL: C22 C32 C52 G14
    Date: 2015–10
  23. By: HA Doan Thi Thanh (Asian Development Bank Institute); KIYOTA Kozo (Keio Economic Observatory, Keio University); YAMANOUCHI KentaAuthor-Workplace-Name: Keio University
    Abstract: This paper attempts to measure the effect of resource misallocation on aggregate manufacturing total factor productivity (TFP), focusing on Vietnamese manufacturing firms for the period 2000–2009. One of the major findings of this paper is that there would have been substantial improvement in aggregate TFP in Viet Nam in the absence of distortions. The results imply that potential productivity gains from removing distortions are large in Vietnamese manufacturing. We also find that smaller firms tend to face advantageous distortions, while larger firms tend to face disadvantageous ones. Moreover, the efficient size distribution is more dispersed than the actual size distribution. These results together suggest that Vietnamese policies may constrain the largest and most efficient producers and coddle its small and least efficient ones.
    Keywords: misallocation. total factor productivity, Viet Nam
    JEL: O47 F14 D2
    Date: 2016–05
  24. By: Yang Hu (University of Waikato); Les Oxley (University of Waikato)
    Abstract: We apply the generalized sup ADF (GSADF), unit root tests of Phillips, Shi and Yu (2015b, PSY) to investigate exchange rate bubbles in some G10, Asian and BRICS countries between March 1991 and December 2014. We present results based upon tests of the unit root null with and without an intercept. We show, with an intercept, that we can identify equivalent periods of collapse or recovery and also spurious bubbles. Whereas without an intercept in the null leads to identification of only bubbles (if they exist) and none is spurious. Bubbles are considered in the nominal exchange rate, which are then tested whether they are driven by exchange rate fundamentals (the relative price of traded or non-traded goods) or represent rational bubbles. We also test for bubbles in the exchange rate fundamentals themselves. Of particular interest is that we conclude that the US Dollar-Mexican Peso crisis of 1994-95 was a bubble.
    Keywords: bubbles; rational bubbles; GSADF test; G10 countries; emerging markets countries
    JEL: C12 C15 F31
    Date: 2016–05–11
  25. By: James B. Ang (Division of Economics, School of Humanities and Social Sciences, Nanyang Technological University, 14 Nanyang Drive, Singapore 637332)
    Abstract: This paper presents evidence on the relationship between culture and technology adoption. It hy-pothesizes that societies with more individualistic cultures are more inclined to embrace new tech-nologies. Using data for 82 countries, the estimates show that the technology adoption index of Comin et al. (2010) strongly correlates with national scores on individualistic cultures. Consistent evidence of this is provided by analysis conducted at the individual level using data from the World Value Surveys. Based on the notion that farming rice makes the members of a society more interdependent, and hence less individualistic, historical information on the suitability of land for rice farming is used as an instrument to isolate the endogenous influence of culture. Under the identifying restriction assumption that such an agricultural legacy explains differences in technolog-ical development in the modern world through influencing the formation of individualistic cultures, the instrumental variables estimates consistently show that the variation in the exogenous component of individualistic cultures significantly explains differences in the levels of current technology adoption across the globe. Similar findings are obtained when the analysis is conducted using state-level data from the United States. On the whole, these results lend strong support to our hypothe-sis that countries with higher scores on individualism are more inclined to adopt new technologies, thereby providing a framework for understanding the underlying causes of the variation in the lev-els of technological development across countries.
    Keywords: technology adoption, individualism, cross-country studies
    JEL: O30 O40
    Date: 2015–09
  26. By: Raul V. Fabella (School of Economics, University of the Philippines Diliman; National Academy of Science and Technology)
    Abstract: In Part I, we argue that Economics must outgrow the narrow confines of Neo-Classical Economics to embrace ‘sociality’ first championed by Herbert Simon in the mid-1950s and now by a growing number of economists under the banner of Social Economics. We contend here that Neo-Classical Economics is incomplete, rather than wrong. Firstly any alternative model must subsume the Neo-Classical model as a special case even as it embraces conceptual promontories from other social science disciplines, viz., groups, norms and sanctions. Secondly, it must be couched in a language familiar to the economics profession? maintain optimizing behavior and equilibrium analysis. In Part II, we construct a formal model where the agent is at once a private entity and a member of a social group; his utility is inclusive combining the agent’s private utility over goods (the Neo-Classical utility) and the utility the he derives from being a member, viz., access to group’s collective good. As a member, he commits to support the procurement of the group’s collective good and submits to a system of norms and to the corresponding self-organized sanctions regime punishing violation of group norms. The agent solves a sequence of optimization problems: the first determines his optimal consumption basket given his budget constraint (net of group contribution), prices in the market location of the group; this gives his inclusive indirect utility; the second determines his optimal market hours by maximizing his indirect inclusive utility subject to time constraint and the market wage rate; this gives his doubly indirect inclusive utility; thirdly, he maximizes his inclusive doubly indirect utility with respect to the monetary contribution of the group given the sanctions for norm violation. The choice of social group follows from a rank order of groups by greatest inclusive utility an agent can attain in each competing social group. Finally, we show how the agent’s relative weighting of his private and group commitment may wax and wane depending upon the stakes of the inter-group competition.
    Keywords: Sociality, groups, norms, choice of groups, compliance with norms, inter-group competition
    JEL: D01 D11
    Date: 2016–05

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