nep-sea New Economics Papers
on South East Asia
Issue of 2019‒03‒04
fifty-one papers chosen by
Kavita Iyengar
Asian Development Bank

  1. Public–Private Partnership Systems in the Republic of Korea, the Philippines, and Indonesia By Kim, Kang-Soo; Jung, Min-Woong; Park, Mee-Soo; Koh, Yoo-Eun; Kim, Jin-Oh
  2. Consumption- and Productivity-Adjusted Dependency Ratio with Household Structure Heterogeneity By Han, Xuehui; Cheng, Yuan
  3. The SEARCA-led School-plus-Home Gardens Project in the Philippines: A Participatory and Inclusive Model for Sustainable Development By Blesilda M. Calub; Leila S. Africa; Bessie M. Burgos; Henry M. Custodio; Shun-Nan Chiang; Anna Gale C. Galvez; Elson Ian Nyl E. Galang; Maria Katrina R. Punto
  4. Strategic Fertility, Education Choices, and Conflicts in Deeply Divided Societies By Bezin, Emeline; Chabé-Ferret, Bastien; de la Croix, David
  5. Rice Economy of Thailand By Napasintuwong, Orachos
  6. Regional differences in willingness to pay for organic vegetables in Vietnam By Thanh Mai Ha; Shamim Shakur; Kim Hang Pham Do
  7. Why has the Philippines’ Growth Performance Improved? From Disappointment to Promising Success By Felipe, Jesus; Estrada, Gemma
  8. Development and Concentration of Maize Seed Market in Thailand By Napasintuwong, Orachos
  9. Influence of reference group indicators to the image of modern retail (case in Indonesia) By Sugito, Sugito; Lubis, Arlina Nurbaity; Rini, Endang Sulistya; Absah, Yeni
  10. Human Capital Spending, Inequality, and Growth in Middle-Income Asia By Abrigo, Michael R.M.; Lee, Sang-Hyop; Park , Donghyun
  11. When Celebrities Speak: A Nationwide Twitter Experiment Promoting Vaccination In Indonesia By Vivi Alatas; Arun G. Chandrasekhar; Markus Mobius; Benjamin A. Olken; Cindy Paladines
  12. Asia’s Industrial Transformation: The Role of Manufacturing and Global Value Chains (Part 2) By Felipe, Jesus
  13. Prior Experience, Trust, IS Success Model: A Study on the Use of Tax e-Filing in Indonesia By Christine Tjen; Vitria Indriani; Panggah Tri Wicaksono
  14. Predicting CPI in Singapore: An application of the Box-Jenkins methodology By NYONI, THABANI
  15. Constructing the Asia-Pacific Regional Cooperation and Integration Index: A Panel Approach By Park, Cyn-Young; Claveria, Racquel
  16. Biofuels and food security: Evidence from Indonesia and Mexico By Mohamed Boly; Aïcha Sanou
  17. Measuring Rice Yield from Space: The Case of Thai Binh Province, Viet Nam By Guan, Kaiyu; Hien, Ngo The; Rao, Lakshman Nagraj
  18. An Empirical Analysis of the Factors that Influence Infrastructure Project Financing by Banks in Select Asian Economies By Rao, Vivek
  19. RICE SEED SYSTEM IN THAILAND By Napasintuwong, Orachos
  20. Asia’s Middle-Income Challenge: An Overview By Estrada, Gemma; Han, Xuehui; Park, Donghyun; Tian, Shu
  21. Asian Development Outlook Forecast Accuracy 2007–2016 By Ferrarini, Benno
  22. Market adoption and diffusion of fecal sludge-based fertilizer in developing countries: crosscountry analyses By Otoo, Miriam; Gebrezgabher, Solomie; Danso, G.; Amewu, Sena; Amirova, Iroda
  23. Potential Use of the Life Satisfaction Approach to Value Nonmarket Goods and Services By Fernandez, Cheryl Joy; Raitzer, David; Ginting , Edimon
  24. Expanding Social Health Protection in Cambodia: An assessment of the current coverage potential and gaps, and social equity considerations By Robert Kolesar; Sambo Pheakdey; Bart Jacobs; Narith Chan; Samedy Yok; Martine Audibert
  25. Explaining the evolution of ethnicity differentials in academic achievements: The role of time investments By Ha Trong Nguyen; Luke B Connelly; Huong Thu Le; Francis Mitrou; Catherine L Taylor; Stephen R Zubrick
  26. Financial Inclusion: New Measurement and Cross-Country Impact Assessment By Park, Cyn-Young; Mercado, Jr., Rogelio
  27. Expected Work Experience: A New Human Capital Measure By Zveglich, Jr., Joseph Ernest; van der Meulen Rodgers, Yana; Laviña, Editha
  28. Improving Paddy Rice Statistics Using Area Sampling Frame Technique By Durante, Anna Christine; Lapitan, Pamela; Megill, David; Rao , Lakshman Nagraj
  29. Public–Private Partnership Development in Southeast Asia By Zen, Fauziah
  30. The Impact of Trade Conflict on Developing Asia By Abiad, Abdul; Baris, Kristina; Bertulfo, Donald Jay; Camingue-Romance, Shiela; Feliciano, Paul Neilmer; Mariasingham, Joseph; Mercer-Blackman , Valerie; Bernabe, John Arvin
  31. Demand System and Market Share of Myanmar Melons in China Market By Lwin, Wuit Yi; Henneberry, Shida Rastegari
  32. Do Local Currency Bond Markets Enhance Financial Stability? By Park, Donghyun; Shin, Kwanho; Tian, Shu
  33. Asia’s Industrial Transformation: The Role of Manufacturing and Global Value Chains (Part 1) By Felipe, Jesus
  34. Can Policy Change Culture? Government Pension Plans and Traditional Kinship Practices By Bau, Natalie
  35. Exchange Rate Dynamics and United States Dollar-Denominated Sovereign Bond Prices in Emerging Markets By Hui, Cho-Hoi; Lo, Chi-Fai; Chau, Po-Hon
  36. Women’s Asset Ownership: Evidence from Georgia; Mongolia; and Cavite, Philippines By Joshi, Kaushal; Swaminathan, Hema; Martinez, Jr., Arturo; Addawe, Mildred; Soco , Christian Flora Mae
  37. Population Aging and the Possibility of a Middle-Income Trap in Asia By Ha, Joonkyung; Lee , Sang-Hyop
  38. Distributed Ledger Technologies for Developing Asia By Ferrarini, Benno; Maupin, Julie; Hinojales , Marthe
  39. The fiscal lifetime cost of receiving refugees By Ruist, Joakim
  40. Push Factors and Capital Flows to Emerging Markets: Why Knowing Your Lender Matters More Than Fundamentals By Cerutti, Eugenio; Claessens, Stijn; Puy, Damien
  41. The Changing Network of Financial Market Linkages: The Asian Experience By Dungey, Mardi; Chowdhury, Biplob; Kangogo, Moses; Sayeed, Mohammad Abu; Volkov, Vladimir
  42. TINFORGE – Trade in INFORGE. Methoden-Update 2019 By Anke Mönnig; Dr. Marc Ingo Wolter
  43. Hazard Analysis on Public–Private Partnership Projects in Developing Asia By Lee, Minsoo; Han, Xuehui; Quising, Pilipinas; Villaruel, Mai Lin
  44. Land Measurement Bias: Comparisons from Global Positioning System, Self-Reports, and Satellite Data By Dillon, Andrew; Rao, Lakshman Nagraj
  45. Determinants of Public–Private Partnerships in Infrastructure in Asia: Implications for Capital Market Development By Hyun, Suk; Park, Donghyun; Tian, Shu
  46. Online Appendix to "Aggregate Consequences of Credit Subsidy Policies: Firm Dynamics and Misallocation" By In Hwan Jo; Tatsuro Senga
  47. Do Information and Communication Technologies Empower Female Workers? Firm-Level Evidence from Viet Nam By Chun, Natalie; Tang, Heiwai
  48. Specification Tests for Temporal Heterogeneity in Spatial Panel Models with Fixed Effects By Xu, Yuhong; Yang, Zhenlin
  49. Does Trafic Management Matter? Evaluating Congestion Effect of Odd-Even Policy in Jakarta By Muhammad Halley Yudhistira; Regi Kusumaatmadja; Mochammad Firman Hidayat
  50. Does Regional Integration Matter for Inclusive Growth? Evidence from the Multidimensional Regional Integration Index By Park, Cyn-Young; Claveria, Racquel
  51. Is Employment Globalizing? By Chen, Liming; Felipe, Jesus; Kam, Andrew J.Y.; Mehta, Aashish

  1. By: Kim, Kang-Soo (Korea Development Institute); Jung, Min-Woong (Korea Development Institute); Park, Mee-Soo (Korea Development Institute); Koh, Yoo-Eun (Korea Development Institute); Kim, Jin-Oh (Korea Development Institute)
    Abstract: Infrastructure plays a critical role in boosting the economy’s overall productivity and development toward improving the quality of life. Public–private partnership (PPP) is considered as one of the key modalities for sustainable infrastructure development. This paper analyzes and compares the PPP systems in the Republic of Korea, the Philippines, and Indonesia to identify the requirements for making this modality an effective catalyst for infrastructure’s contribution to sustainable development. These countries have used the increased capacity and transactional experience in handling these partnerships to develop their PPP markets and strengthen their institutional framework to increase the use of PPPs to provide infrastructure services. A comparative analysis is then conducted to draw lessons for other economies in developing Asia seeking to improve the efficiency and effectiveness of their PPPs. The analysis underscores how strong institutions, unified procurement frameworks, and effective dispute resolution mechanisms can improve the implementation of infrastructure PPPs.
    Keywords: infrastructures; legal and institutional frameworks; public–private partnership
    JEL: H40 H50 O20
    Date: 2018–10–16
  2. By: Han, Xuehui (Asian Development Bank); Cheng, Yuan (Fudan University)
    Abstract: In this study, we construct a new dependency ratio measure by taking into account the consumption needs of the young and elderly people, and the productivity of middle-aged people. Different from the way that Cutler et al. (1990) and Weil (1999) constructed the relative needs by using the average consumptions of each age cohort of people, we estimate the factor of relative needs of people at different ages based on a regression model, which embraces the household age compositions and size in the assessment. Our analysis uses household survey data from five developing countries in Asia— Bangladesh, Cambodia, the People’s Republic of China (PRC), Thailand, and Viet Nam. To our best knowledge, this is among the pioneer work exploring such patterns for these countries. Focusing on the PRC, we further examine whether consumptions depend on the coresidence style. We found that (i) the consumption- and productivity-adjusted dependency ratio (both total and old dependency ratios) are consistently lower than the one that is traditionally defined across all five countries in our sample, and the differences vary from country to country; (ii) in the PRC, the differences between traditional dependency ratio and the consumption- and productivity-adjusted dependency ratio grow larger in more distant future; and (iii) in the PRC, the relatively younger elderly members between 65 and 72 years old help in reducing the consumption of young members in their households, and the elderly members who live alone consume more than their peers who live with their offspring. We also simulate the impacts of smaller households, urbanization, and economic growth on consumption for the PRC, based on our model.
    Keywords: consumption- and productivity-adjusted dependency ratio; coresidence; household structure
    JEL: D10 E10 E21 H55 J11
    Date: 2017–12–18
  3. By: Blesilda M. Calub; Leila S. Africa; Bessie M. Burgos; Henry M. Custodio; Shun-Nan Chiang; Anna Gale C. Galvez; Elson Ian Nyl E. Galang; Maria Katrina R. Punto
    Abstract: School gardening has been increasingly popular in the past decade both in developed and developing countries. However, most school gardening projects focus on educational goals and aim to increase school children's knowledge of food systems and their acceptance of vegetable consumption. The School-Plus-Home Gardens Project (S+HGP), a collaboration among the Southeast Asian Regional Center for Graduate Study and Research in Agriculture (SEARCA), the University of the Philippines Los Baños (UPLB), and the Department of Education (DepEd) of the Philippines, district of Laguna, revived and redesigned DepEd's earlier school garden programs to an innovative approach focusing on nutrition, education, and economic well-being of school children, their families, and their communities. The S+HGP was piloted in six schools in the province of Laguna, Philippines with a model where harvests from the school gardens provided fresh vegetables for the school-based feeding program. The model also extended the gardening-feeding linkage to the establishment of food gardens in school children's homes. More than just establishing home gardens, the parents developed a greater sense of responsibility to ensure good nutrition for their children, while also saving on food expenses. It highlighted the multi-functionality of school gardens as learning laboratories for educating pupils, teachers, and parents about sustainability concepts and interconnections of food and nutrition, organic agriculture, edible landscaping, climate change, and solid waste management. Key project outcomes are discussed according to five categories, namely, socio-cultural, technical, economic/financial, environmental, and policy-institutional aspects. Mechanisms for sustaining and scaling up the initial success of the S+HGP were designed in a stepwise process, where the pilot schools took the lead to pay forward and share their knowledge with other schools, particularly, small schools in remote areas through intra-school and interdistrict networking. From the six original pilot schools in 2016, there are now two additional adopted schools, 23 sister schools, and three brother schools.
    Keywords: Philippines
    Date: 2019
  4. By: Bezin, Emeline; Chabé-Ferret, Bastien; de la Croix, David
    Abstract: Fertility becomes a strategic choice when having a larger population helps to gain power. Minority groups might find it optimal to promote high fertility among their members - this is known as the "weapon of the womb" argument. If, in addition, parents have to invest resources to educate their children, a higher fertility for strategic motives might reduce their investment. Indonesian census data dispel this view, as minority religious groups do not invest less in education. If anything, they invest more in education, as well as in their number of children. This finding is consistent with human capital being an input to appropriation. Solving for the Nash equilibrium of a game between two groups with two strategic variables, we derive the condition under which the minority group displays a higher investment in both the quantity and quality of children. The material cost of conflict involved through the weapon of the womb mechanism is mitigated when human capital enters the contest function.
    Keywords: conflict; Fertility; Human Capital; Indonesia; minorities; Nash equilibrium; population engineering; quality-quantity trade-off
    JEL: D74 J13 J15
    Date: 2018–12
  5. By: Napasintuwong, Orachos
    Abstract: Rice has been the main staple food and important to the economy of Thailand. As the country is becoming more developed toward industrialization, the contribution of agricultural sector including the rice sector becomes less to the GDP. Nevertheless, nearly 40 percent of the population depends on agriculture for their living and 70 per cent of them are in rice sector. As Thailand has sent the goal for Thailand 4.0 using advanced technology and smart farming to release itself from the middle income trap, this paper describes the historical background and current situations of Thai rice economy, and discussing its strategic plans to manage current challenges.
    Keywords: Agricultural and Food Policy
    Date: 2019–01–10
  6. By: Thanh Mai Ha (School of Economics and Finance, Massey University, Palmerston North, New Zealand and Faculty of Economics and Rural Development, Vietnam National University of Agriculture, Vietnam); Shamim Shakur (School of Economics and Finance, Massey University, Palmerston North, New Zealand); Kim Hang Pham Do (School of Economics and Finance, Massey University, Palmerston North, New Zealand)
    Abstract: The concern about vegetable safety, together with a booming population and the rise of the middle class has made Vietnam become a potential market for organic vegetables. This paper investigates the determinants of willingness to pay (WTP) for organic vegetables in Hanoi, Vietnam with a particular attention to regional differences and the effect of risk perception. Using Contingent Valuation Method to analyze the data from a sample of 498 consumers in Hanoi, the paper shows that the perceived use values of organic vegetables, trust in organic labels, and disposable family income increased WTP for organic vegetables in both urban and rural regions. Though risk perception of conventional vegetables was high in both regions, such heightened risk perception just translated into the WTP in the rural region. In addition, the percentage of home-grown vegetables in the total vegetable consumption of the family influenced the WTP in the rural region only. Moreover, being an organic purchaser was positively related to the WTP in the urban region but not in the rural region. The paper also discusses three policy implications for Vietnam to boost the demand for organic food.
    Keywords: Willingness to pay, organic vegetables, food safety, rural-urban difference, Hanoi
    JEL: Q18 D12 I12 Q13 R22
    Date: 2018
  7. By: Felipe, Jesus (Asian Development Bank); Estrada, Gemma (Asian Development Bank)
    Abstract: This paper analyzes why the Philippines’ growth performance has improved significantly in recent years. As in the medium to long term actual growth adjusts to potential, we posit that the reason behind this improvement is that the country’s potential growth is increasing. We derive an estimate of the potential growth rate, defined as the growth consistent with a constant unemployment rate, through the notion of Harrod’s natural growth rate and Okun’s Law. Kalman filter estimation allows us to obtain a time series of potential growth rate for 1957-2017. Results corroborate that potential growth is increasing. It reached 6.3% in 2017, the highest value during the last 60 years. We find that in recent years, labor productivity growth (technical progress) accounts for most of the country’s potential growth rate, as the trend labor force growth displays a downward trend. A decomposition of labor productivity growth shows that the within effect accounts for 70% of it, and that most of it is due to manufacturing productivity growth. As actual growth in 2017 reached 6.7% and to maintain the growth momentum, Philippine authorities ought to focus on increasing potential growth to enable more room for growth in a stable macroeconomic environment. Finally, two key results emerge from our analysis of output and productivity growth, and employment. First, estimates of Okun’s Law indicate that the response of Philippine unemployment and visible underemployment to output growth is very small. However, the response of total underemployment is positive and significant. Second, productivity growth does not destroy employment.
    Keywords: Harrod’s natural growth rate; Kalman filter; Okun’s Law; Philippines; potential growth; underemployment; unemployment
    JEL: E24 E32 O47 O53
    Date: 2018–04–11
  8. By: Napasintuwong, Orachos
    Abstract: Today Thailand is the second largest field crop seed exporter in Asia with maize contributing the highest value to seed exports. Hybrid maize is considerably adopted in Thailand mainly due to the demand from feed industry and development of livestock and poultry industry. The success of varietal development of commercial maize hybrids is owed to the investments of international donors during the 1980s and continuous breeding efforts of multinational seed companies even as public institutions played a key role in maintaining genetic resources conservation and pre-commercial lines research. This paper reviews the history of research and development in maize and maize seed market development in Thailand. Furthermore, expert elicitation method is used to reveal the adoption of commercial maize varieties in 2013/2014 cropping seasons. The results of adopted maize varieties were used to estimate market shares and suggested that maize seed market in Thailand is moderately concentrated with tendencies towards oligopolistic competition.
    Keywords: Agricultural and Food Policy, Crop Production/Industries, Industrial Organization
    Date: 2017–03–31
  9. By: Sugito, Sugito; Lubis, Arlina Nurbaity; Rini, Endang Sulistya; Absah, Yeni
    Abstract: This study aims to analyze the influence of the reference group to the image of modern retail in Medan. The research population is modern retail consumers in Medan.The samples in this study were consumers who shop at Indomaret, Alfa Mart and Alfa Midi modern retailers in Medan City, Indonesia and tthe sample size obtained was 204 by the fraction sample method. This study analysis uses a Structural Equation Modeling (SEM). The results concluded that the reference group has a significant effect on the modern retail images.
    Keywords: consumers; reference group; image of modern retail;
    JEL: D91 L81 M31
    Date: 2018–09
  10. By: Abrigo, Michael R.M. (Philippine Institute for Development Studies); Lee, Sang-Hyop (University of Hawaii at Manoa); Park , Donghyun (Asian Development Bank)
    Abstract: Asia’s rapid population aging fortifies the case for strengthening human capital investments. Further, the experience of the newly industrialized economies suggests that human capital investments will be a vital ingredient of the transition from middle income to high income. Those investments can also affect equity and public finances. In this paper, we use data from the National Transfer Accounts to empirically analyze the effect of human capital investment in Asian countries on economic growth, inequality, and fiscal balance. Our empirical evidence suggests that human capital investments have a positive effect on labor productivity and, hence, output. The positive effect is stronger for poorer households and, hence, beneficial for equity. We also find that such investments can generate sufficient tax revenues to improve the fiscal balance. Overall, our evidence points to a positive effect of human capital on growth, equity, and fiscal balance in Asia.
    Keywords: Asia; fiscal balance; growth; human capital; inequality
    JEL: H52 I24 I25 J24
    Date: 2017–12–05
  11. By: Vivi Alatas; Arun G. Chandrasekhar; Markus Mobius; Benjamin A. Olken; Cindy Paladines
    Abstract: Celebrity endorsements are often sought to influence public opinion. We ask whether celebrity endorsement per se has an effect beyond the fact that their statements are seen by many, and whether on net their statements actually lead people to change their beliefs. To do so, we conducted a nationwide Twitter experiment in Indonesia with 46 high-profile celebrities and organizations, with a total of 7.8 million followers, who agreed to let us randomly tweet or retweet content promoting immunization from their accounts. Our design exploits the structure of what information is passed on along a retweet chain on Twitter to parse reach versus endorsement effects. Endorsements matter: tweets that users can identify as being originated by a celebrity are far more likely to be liked or retweeted by users than similar tweets seen by the same users but without the celebrities' imprimatur. By contrast, explicitly citing sources in the tweets actually reduces diffusion. By randomizing which celebrities tweeted when, we find suggestive evidence that overall exposure to the campaign may influence beliefs about vaccination and knowledge of immunization-seeking behavior by one's network. Taken together, the findings suggest an important role for celebrity endorsement.
    JEL: D85 I15 O33
    Date: 2019–02
  12. By: Felipe, Jesus (Asian Development Bank)
    Abstract: This paper argues that the single most important factor that explains East Asia’s development success was its fast structural transformation toward industrialization, manufacturing in particular. Workers moved out of agriculture into manufacturing, and the sector diversified and upgraded its structure. Manufacturing activities are subject to increasing returns to scale, and many manufacturing goods have high income elasticities of demand. As a consequence, the sector is referred to as the “engine of growth.” It is in the context of industrialization that openness played an important role in East Asia’s success, i.e., the connection between “export-led growth” (the relaxation of the balance-of-payments constraint on foreign exchange) and industrialization. Part 2 of the paper reviews the role of Asia’s developmental states in consciously accelerating industrial development and learning, as well as the region’s mixed experiences with industrial policies. Second, it provides a discussion of how Asian firms hooked up on to global value chains.
    Keywords: capabilities; developmental states; latecomer model; global value chains; industrial policy
    JEL: O10 O14 O25
    Date: 2018–07–25
  13. By: Christine Tjen (Faculty of Economics and Business Universitas Indonesia); Vitria Indriani (Faculty of Economics and Business Universitas Indonesia); Panggah Tri Wicaksono (Faculty of Economics and Business Universitas Indonesia)
    Abstract: The purpose of this paper was to explore the perception of online tax ?ling in Indonesia using prior experience, trust, and IS (Information System) Success Model. The paper examined how the IS quality will be in?uenced by attributes such as prior experience on of?ine tax ?ling, trust in government, trust in technology, and trust in e-Filing website. Following this, the in?uence of IS quality on perceived usefulness and user satisfaction will be explored. To end the model, the paper was intended to answer question on whether the last two dimensions (perceived usefulness and user satisfaction) will have an effect on perceived net bene?t. This paper used primary data generated by distributing online questionnaire and able to get the total of 1.095 respondents, 993 of which are actively using online tax-?ling (e-?ling) and valid. The data were analyzed by the Structured Equation Model (SEM). The results suggested that trust in government and trust in technology positively affect the trust in e-Filing website, which subsequently in?uence all three IS quality dimensions. Information quality, system quality and service quality was found to be consistently and signi?cantly in?uence the perceived usefulness and user satisfaction. It was evident that tax payers in Indonesia placed the robustness and the safety features of the online system as the most important attributes that will in?uence the usefulness and satisfaction of online tax ?ling.
    Keywords: e-?ling — online tax return — IS quality — trust
    JEL: H20
    Date: 2018
    Abstract: This research uses annual time series data on CPI in Singapore from 1960 to 2017, to model and forecast CPI using the Box – Jenkins ARIMA technique. Diagnostic tests indicate that the S series is I (1). The study presents the ARIMA (1, 1, 2) model for predicting CPI in Singapore. The diagnostic tests further show that the presented optimal model is actually stable and acceptable. The results of the study apparently show that CPI in Singapore is likely to continue on an upwards trajectory in the next decade. The study basically encourages policy makers to make use of tight monetary and fiscal policy measures in order to control inflation in Singapore.
    Keywords: Forecasting; Inflation; Singapore
    JEL: C53 E31 E37 E47
    Date: 2019–02–15
  15. By: Park, Cyn-Young (Asian Development Bank); Claveria, Racquel (Asian Development Bank)
    Abstract: In this paper, we propose a panel approach in the construction of the Asia-Pacific Regional Cooperation and Integration Index (ARCII) to strengthen the index’s ability to track the progress of economic integration in the region over time. Panel-based procedures are employed in imputing missing values, normalizing raw data, and deriving dimensional and subdimensional weights via principal components analysis. Findings suggest the pace of integration in Asia was broadly steady over the 11-year sample period (2006–2016). However, modest gains have been made as a majority of economies in the sample have moved up in their levels of regional integration from 2006 to 2016. Of the six dimensions featured in the ARCII, trade and investment and movement of people are the main drivers of regional integration, while the money and finance dimension was the weakest link. Based on global normalization, Asia comes second to the European Union (EU) in progress on regional integration, but in recent years a few Asian economies have broken through to the top tier dominated by the EU economies.
    Keywords: Asia; composite index; regional integration
    JEL: C38 C43 F15
    Date: 2018–05–10
  16. By: Mohamed Boly (CERDI - Centre d'Études et de Recherches sur le Développement International - Clermont Auvergne - UCA - Université Clermont Auvergne - CNRS - Centre National de la Recherche Scientifique); Aïcha Sanou (CERDI - Centre d'Études et de Recherches sur le Développement International - Clermont Auvergne - UCA - Université Clermont Auvergne - CNRS - Centre National de la Recherche Scientifique)
    Abstract: We analyze food security effects of biofuel production by using the synthetic control method. This retrospective and graphical analysis focuses on Indonesia and Mexico from 2000 to 2013. Indonesia is a major biodiesel producer while Mexico is specialized in maize and ethanol. Our findings show that biodiesel production positively affects food security through the increase in daily per capita energy consumption and food production index, but we observe the reverse effect for bioethanol. After the adoption of biofuels, the gap between Indonesia and its counter-factual allows us to conclude that biodiesel production does not harm food security. This could be explained by the fact that biodiesel production uses some feedstocks which do not directly compete with food crops; moreover, biodiesel exports generate revenues which are allocated to food imports. However, the gap between Mexico and its counter-factual suggests that bioethanol production leads to a reduction in food security, this because it uses maize which is the staple food of many Mexicans. Furthermore, Mexican ethanol exports compete with that of the U.S. Our results are robust to several falsification tests.
    Keywords: Food security,Biofuels,Impact assessment
    Date: 2019–02–14
  17. By: Guan, Kaiyu (University of Illinois); Hien, Ngo The (Ministry of Agriculture and Rural Development); Rao, Lakshman Nagraj (Asian Development Bank)
    Abstract: Despite a growing interest in using satellite data to estimate paddy rice yield in Southeast Asia, significant cloud coverage has led to a scarcity of usable optical data for such analysis. In this paper, we study the feasibility of using two alternative sources of satellite data—(i) surface reflectance fusion data which integrates Landsat and Moderate Resolution Imaging Spectroradiometer (MODIS) images, and (ii) L-band radar backscatter data from the Advanced Land Observing Satellite 2 (ALOS-2) PALSAR-2 sensors—to circumvent the cloud cover problem and estimate yield in Thai Binh Province, Viet Nam during the second growing season of 2015. Our findings indicate that although Landsat– MODIS fusion data are not necessarily beneficial for paddy rice mapping when compared with only using Landsat data, fusion data allows us to estimate the peak value of various vegetation indexes and derive the best empirical relationship between these indexes and yield data from the field. We also find that the L-band radar data not only has a lower performance in paddy rice mapping when compared with optical data, but also contributes little to rice yield estimation.
    Keywords: agriculture; ALOS-2; crop cutting; crop yield; Fusion; Landsat; MODIS; paddy rice; remote sensing; Viet Nam
    JEL: C40 O13 Q18
    Date: 2018–03–23
  18. By: Rao, Vivek (Asian Development Bank)
    Abstract: A recent Asian Development Bank publication estimates the large infrastructure financing requirement in Asia for the period 2016–2030, which establishes the strong need to encourage private sector participation to meet investment requirements. This paper analyzes a critical aspect of expanding private finance to infrastructure by examining the role of bank lending to public–private partnership (PPP) projects through the project finance modality. The key empirical results suggest that project financing by banks to infrastructure PPP projects is still in its infancy in several Asian markets, and banks are guided more by macroeconomic factors and by the strength of their balance sheets. The key policy implications to unlock bank finance for infrastructure PPP projects lie in reducing macroeconomic risk factors and having well-capitalized banks. The latter assumes significance, given the higher capital requirements that banks are expected to fulfill, following the adoption of Basel III capital standards.
    Keywords: project finance; bank lending; infrastructure; public–private partnership
    JEL: G21 G32 H41 H54
    Date: 2018–08–20
  19. By: Napasintuwong, Orachos
    Abstract: Thailand’s rice has set a supreme quality standard in the world market. Seed is one of the important factors contributing to good quality grains. As the competition for quality rice in the world market is becoming intensive, rice seeds play a significant role not only to ensure food and income security but also to retain quality and competitiveness of Thai rice in the world market. This paper reviews policies and regulations related to rice seed industry in Thailand, current situations of rice seed system, the supply and demand of rice seeds, and implications for future rice seed industry development. It is found that some of current regulations and business environment do not create much incentive for investments for the private sector. The imports and exports of rice seeds are practically prohibited. Thus, most of existing rice seeds in the market comprise of mainly public varieties produced by formal seed sector with a few exceptions of privately developed varieties by Thai companies, farmers’ groups and research institutes. None of the foreign stakeholders is in rice seed industry in Thailand presently. As seed producers do not hold exclusive rights to reproduce public varieties, and because all of the varieties are not hybrids, informal seed system is the major source of rice seeds. The systems of rice seed suggest that formal and informal systems can be integrated and linkages between both systems should create incentives for business opportunities.
    Keywords: Crop Production/Industries
    Date: 2018–08–31
  20. By: Estrada, Gemma (Asian Development Bank); Han, Xuehui (Asian Development Bank); Park, Donghyun (Asian Development Bank); Tian, Shu (Asian Development Bank)
    Abstract: Developing Asia has undergone a dramatic shift over the past 5 decades from a region of mainly low-income economies toward one that is largely middle income. Compared with world aggregate data, developing Asia now has a much greater proportion of middle-income economies. The region faces the challenge of sustaining rapid growth after graduating from low to middle income, and moving further to high income. Evidence shows that it takes longer for economies to move from upper-middle to high income than shifting from lower-middle to upper-middle income. Still, developing Asian economies were able to shift more quickly than the rest of the world, whether the transition is from lower-middle to upper-middle income or from upper-middle to high income. The experience of newly industrializing economies shows that innovation, human capital, and infrastructure all played a vital role in their quicker transformation from middle to high income.
    Keywords: Asia; economic growth; middle income
    JEL: O10 O11
    Date: 2017–11–20
  21. By: Ferrarini, Benno (Asian Development Bank)
    Abstract: This paper assesses the accuracy of Asian Development Outlook growth and inflation forecasts for 43 Asian economies from 2007 to 2016, against the benchmark of World Economic Outlook projections by the International Monetary Fund. They are found to overlap quite closely, notwithstanding much heterogeneity across countries and years. Forecast accuracy sharpens over time as additional data and evidence become available and get incorporated during quarterly revisions. However, errors widen during crisis years as forecasters struggle to reflect such events in their projections.
    Keywords: Asian Development Bank; Asian Development Outlook; International Monetary Fund; macroeconomic forecasts; World Economic Outlook
    JEL: E17 E37
    Date: 2019–01–15
  22. By: Otoo, Miriam; Gebrezgabher, Solomie; Danso, G.; Amewu, Sena; Amirova, Iroda
    Abstract: The safe recovery of nutrients from our waste streams allows us to address the challenges of waste management and soil nutrient depletion conjointly. Commercialization of waste-based organic fertilizers such as FortiferTM (fecal sludge-based co-compost) has the potential to generate significant benefits for developing economies via cost recovery for the sanitation sector and the provision of an alternative agricultural input for smallholder farmers. To guide future FortiferTM businesses, this report presents examples of detailed market assessments, based on farmers’ perceptions, attitudes and willingness-to-pay (WTP) for a pelletized and non-pelletized FortiferTM co-compost. The research was conducted in the Greater Accra and Western regions in Ghana, and in and around Kampala (Uganda), Bangalore (India), Hanoi (Vietnam), and Kurunegala (Sri Lanka). Cross-country analyses helped to understand the effects of market drivers and, where possible, capture lessons learned for knowledge sharing.
    Keywords: Agribusiness, Agricultural Finance, Crop Production/Industries, Farm Management, Financial Economics, Food Consumption/Nutrition/Food Safety, Marketing
    Date: 2018–02–19
  23. By: Fernandez, Cheryl Joy (Asian Development Bank); Raitzer, David (Asian Development Bank); Ginting , Edimon (Asian Development Bank)
    Abstract: Economic analysis often faces challenges in the valuation of nonmarket goods and services. The traditional set of nonmarket valuation tools for measuring Marshallian economic surplus has limitations related to potential bias in stated preferences and endogeneity of nonmarket amenity placement in revealed preference studies. The life satisfaction approach offers a Hicksian compensating variationbased alternative, which uses self-reported subjective well-being to calculate the marginal rate of substitution of income for nonmarket amenities or services. The conceptual basis for the approach is explained and illustrated with an example from Iloilo, Philippines. Recommendations are offered for future application of the technique in the economic analysis of investment projects.
    Keywords: economic analysis; life satisfaction; natural disasters; Philippines; valuation; well-being
    JEL: D61 D69 D90 H40 Q51
    Date: 2019–01–29
  24. By: Robert Kolesar (The Palladium Group , National Social Protection Council, Ministry of Economy and Finance, CERDI - Centre d'Études et de Recherches sur le Développement International - Clermont Auvergne - UCA - Université Clermont Auvergne - CNRS - Centre National de la Recherche Scientifique); Sambo Pheakdey (National Social Protection Council, Ministry of Economy and Finance); Bart Jacobs (Radboud university [Nijmegen], GIZ - Deutsche Gesellschaft für Internationale Zusammenarbeit); Narith Chan (National Social Protection Council, Ministry of Economy and Finance); Samedy Yok (National Social Protection Council, Ministry of Economy and Finance); Martine Audibert (CERDI - Centre d'Études et de Recherches sur le Développement International - Clermont Auvergne - UCA - Université Clermont Auvergne - CNRS - Centre National de la Recherche Scientifique)
    Abstract: The Government of Cambodia recently launched its National Social Protection Policy Framework to strengthen and expand its social protection system. To inform the future direction of social health protection policy in Cambodia we examine the 2016 Cambodia Socio-economic survey to assess the current coverage potential of existing health insurance schemes and coverage gaps; and, compare fair and equitable contribution rates. The current health coverage expansion efforts are likely to primarily benefit individuals from higher income households. In addition, recent directives to expand coverage to some informal workers leaves significant gaps, particularly among vulnerable groups, farmers, and the self-employed. The average out-of-pocket health care costs exceed capacity to pay among individuals in the lower wealth quintiles. Thus, we conclude they should be considered financially vulnerable. Finally, we illustrate that a fair and equitable approach to individual, monthly healthcare contributions will yield low premium rates and collection costs could exceed the amount collected, particularly among the informal sector. Therefore, we recommend that, in addition to other vulnerable groups and uncovered households in the first wealth quintile, people second and third quintiles who are not formally employed, should be exempted from premium payments as social health protection is expanded.
    Keywords: Social protection policy,Universal health care,Cambodia,Social equity,Vulnerability.
    Date: 2019–02–14
  25. By: Ha Trong Nguyen (Telethon Kids Institute and Bankwest Curtin Economic Centre, Curtin University); Luke B Connelly (The University of Queensland); Huong Thu Le (School of Population and Global Health, University of Western Australia); Francis Mitrou (Telethon Kids Institute; University of Western Australia); Catherine L Taylor (Telethon Kids Institute; University of Western Australia); Stephen R Zubrick (Telethon Kids Institute; University of Western Australia)
    Abstract: Children of Asian immigrants in most English-speaking destinations have better academic outcomes, yet the underlying causes of their advantages are under-studied. We employ panel time-use diaries by two cohorts of children observed over a decade to present new evidence that children of Asian immigrants begin spending more time than their peers on educational activities from school entry; and, that the ethnicity gap in the time allocated to educational activities increases over time. By specifying an augmented value-added model and invoking a quantile decomposition method, we find that the academic advantage of children of Asian immigrants is attributable mainly to their allocating more time to educational activities or their favorable initial cognitive abilities and not to socio-demographics or parenting styles. Furthermore, our results show substantial heterogeneity in the contributions of initial cognitive abilities and time allocations by test subjects, test ages and points of the test score distribution.
    Keywords: Migration, Education, Test Score Gap, Time Diary, Quantile Regression, Second generation Immigrants, Australia
    JEL: C21 I20 J13 J15 J22
    Date: 2019–02
  26. By: Park, Cyn-Young (Asian Development Bank); Mercado, Jr., Rogelio (South East Asian Central Banks Research and Training Centre)
    Abstract: This paper introduces a new index of financial inclusion for 151 economies using principal component analysis to compute weights for aggregating nine indicators of access, availability, and usage. It then assesses the impact of financial inclusion on poverty and income inequality. The results provide evidence that high- and middle-high-income economies with high financial inclusion have significantly lower poverty, while no such relation exists for middle-low and low-income economies. The nonlinearities in the cross-country determinants and impacts of financial inclusion on poverty and income inequality across income groups are important to choosing the appropriate policies for achieving inclusive growth in different development stages.
    Keywords: financial inclusion; income inequality; poverty
    JEL: G18 O11 O16
    Date: 2018–03–15
  27. By: Zveglich, Jr., Joseph Ernest (Asian Development Bank); van der Meulen Rodgers, Yana (Rutgers University); Laviña, Editha (Asian Development Bank)
    Abstract: Work experience is a key variable in earnings function estimates and wage gap decompositions. Because data on actual work experience are rare, studies commonly use proxies, such as potential experience. But potential experience is identical for all individuals of the same age and level of education, so it ignores labor market intermittency because of childbirth and child-rearing—a critical omission when analyzing gender differences in earnings. This paper constructs a better proxy: expected work experience—the sum of the annual probabilities that an individual worked in the past. This measure can be generated using commonly available data on labor force participation rates by age and gender to gauge the probability of past work. Applying the measure to labor force survey data from the Philippines shows that conventional proxies underestimate the contribution of gender differences in work experience in explaining the gender wage gap.
    Keywords: gender wage gap; labor force participation; Philippines; potential experience; wage regressions
    JEL: J16 J24 J31 O15 O53
    Date: 2019–02–20
  28. By: Durante, Anna Christine (Asian Development Bank); Lapitan, Pamela (Asian Development Bank); Megill, David (Asian Development Bank); Rao , Lakshman Nagraj (Asian Development Bank)
    Abstract: Traditional sampling strategies for paddy rice statistics rely on outdated list frames, incomplete holding information, or administrative data that are prone to numerous biases. The objective of this study is to test the utility of an area frame developed using remote sensing data in three pilot provinces— Savannakhet (Lao People’s Democratic Republic), Ang Thong (Thailand), and Thai Binh (Viet Nam). Direct estimates of total paddy rice area and production are calculated from area frame using two methods––one involving measurement of plot size using a Global Positioning System instrument and the other utilizing a digitized map of farmer-identified plot boundaries on a high-resolution Google Earth image. A third method involving the calculation of ratio estimates using independent mesh-level measures is compared with the first two methods involving direct estimates, and with the estimates generated from administrative data from the countries. Our study finds that ratio estimation significantly improves the level of precision of paddy rice statistics. Substantial deviations are also observed between official statistics and the statistics generated through direct estimation.
    Keywords: agriculture; sampling methods
    JEL: C83 O13 Q19
    Date: 2018–11–28
  29. By: Zen, Fauziah (Economic Research Institute for ASEAN and East Asia)
    Abstract: Infrastructure development in Southeast Asia has been financed mainly by public funds, which leave wide gaps in majority of countries. Governments have tried to attract the private sector by offering various schemes under public–private partnership (PPP). Typically, PPP contributes less than 1% of gross domestic product, while public finance greatly varies from about 2% to 10% of a country’s gross domestic product. Among major factors supporting PPP implementation, the following features are critical: coherent policy, public sector capacity to manage PPP appropriately, public sector willingness to have mutual relation with private partners, and leadership. Private participation is still continuously growing; and its implementation is not limited to hard infrastructure only, but also to social infrastructure.
    Keywords: infrastructure development; private sector participation; public–private partnership; social infrastructures
    JEL: H54 O21 R53
    Date: 2018–08–15
  30. By: Abiad, Abdul (Asian Development Bank); Baris, Kristina (Asian Development Bank); Bertulfo, Donald Jay (Asian Development Bank); Camingue-Romance, Shiela (Asian Development Bank); Feliciano, Paul Neilmer (Asian Development Bank); Mariasingham, Joseph (Asian Development Bank); Mercer-Blackman , Valerie (Asian Development Bank); Bernabe, John Arvin (Asian Development Bank)
    Abstract: This paper analyzes the effects of the current trade conflict on developing Asia using the Asian Development Bank’s Multiregional Input–Output Table (MRIOT), allowing us to calculate the impact on individual countries and on sectors within countries. The analysis estimates the direct impact on all tariff-affected goods; uses input–output analysis to estimate indirect effects on gross domestic product (GDP), exports, and employment; and allows for redirection of trade toward other producers using the approach of Feenstra and Sasahara (2017). A full escalation of the bilateral United States (US)–People’s Republic of China (PRC) trade conflict would shave 1% off PRC GDP and 0.2% off US GDP. The rest of developing Asia could see small net gains thanks to trade redirection, particularly in the electronics sector. A trade war in autos and parts would hurt the European Union and Japan. The conflict has substantial negative effects on PRC and US employment, but only minor impacts on current account balances.
    Keywords: exports; input–output; international trade; tariffs; trade conflict; trade redirection
    JEL: E00 F13 F14 O47
    Date: 2018–12–14
  31. By: Lwin, Wuit Yi; Henneberry, Shida Rastegari
    Keywords: Demand and Price Analysis
    Date: 2019–02
  32. By: Park, Donghyun (Asian Development Bank); Shin, Kwanho (Korea University); Tian, Shu (Asian Development Bank)
    Abstract: It is widely believed that local currency bond markets (LCBMs) can promote financial stability in developing countries. For instance, they can help mitigate the currency and maturity mismatch that contributed to the outbreak of the Asian financial crisis of 1997–1998. In this paper, we empirically test such conventional wisdom on the stabilizing effect of LCBMs. To do so, we analyze and compare the financial vulnerability of developing countries during two episodes of financial stress—global financial crisis and taper tantrum. During the two episodes, we find a negative association between the growth of LCBMs and the degree of currency depreciation in emerging economies. Similar association is found of bank loans but not for the stock market.
    Keywords: Asian financial crisis; bonds; currency mismatch; developing countries; financial stability; local currency bond markets; maturity mismatch
    JEL: E44 F34 F42
    Date: 2018–10–19
  33. By: Felipe, Jesus (Asian Development Bank)
    Abstract: This paper argues that the single most important factor that explains East Asia’s development success was its fast structural transformation toward industrialization, manufacturing in particular. Workers moved out of agriculture into manufacturing, and the sector diversified and upgraded its structure. Manufacturing activities are subject to increasing returns to scale, and many manufacturing goods have high income elasticities of demand. For these reasons, manufacturing is referred to as the “engine of growth.” It is in the context of industrialization that openness played an important role in East Asia’s success, i.e., the connection between “export-led growth” (the relaxation of the balance-of-payments constraint on foreign exchange) and industrialization. Part 1 of the paper documents the extent of structural transformation in developing Asia. Second, it analyzes the relationship between the exportled growth model (i.e., the relaxation of the balance-of-payments constraint on foreign exchange) and industrialization. Finally, it reviews the industrialization experiences of Japan and the Republic of Korea, and discusses the recent deindustrialization debate.
    Keywords: balance-of-payment constraint; deindustrialization; engine of growth; export-led growth; industrialization; manufacturing; structural transformation
    JEL: O10 O14 O25
    Date: 2018–07–25
  34. By: Bau, Natalie
    Abstract: Policies may change the incentives that allow cultural practices to persist. To test this, I study matrilocality and patrilocality, kinship traditions that determine daughters' and sons' post-marriage residences and thus, which gender lives with and supports parents in their old age. Two separate policy experiments in Ghana and Indonesia show that pension policies reduce the practice of these traditions. I also show that these traditions incentivize parents to invest in the education of children who traditionally co-reside with them. Consequently, when pension plans change cultural practices, they also reduce educational investment. This finding further demonstrates that policy can change culture.
    Keywords: Cultural change; cultural transmission; kinship traditions
    Date: 2019–01
  35. By: Hui, Cho-Hoi (Hong Kong Monetary Authority); Lo, Chi-Fai (Department of Physics, Chinese University of Hong Kong); Chau, Po-Hon (Department of Physics, Chinese University of Hong Kong)
    Abstract: The study conducts an empirical test on dollar-denominated sovereign credit spreads in emerging markets, including Brazil, Colombia, Mexico, the Philippines, the Russian Federation, and Turkey to examine their relationship with each country’s exchange rate and the United States (US) Treasury yields. The relationship between each country’s exchange rate and the pricing of each country’s US-dollar denominated sovereign bonds was particularly strong after the global financial crisis of 2008–2009. A two-factor pricing model is developed with closed-form solutions for the sovereign bonds. The correlated factors in the model are foreign exchange rates and US risk-free interest rates that follow a double square-root process relevant in a low interest rate environment. The numerical results and associated error analysis show that the model credit spreads can broadly track market credit spreads.
    Keywords: bond pricing model; emerging markets; exchange rates; sovereign risk
    JEL: G13 G21 G28
    Date: 2017–12–06
  36. By: Joshi, Kaushal (Asian Development Bank); Swaminathan, Hema (Indian Institute of Management Bangalore); Martinez, Jr., Arturo (Asian Development Bank); Addawe, Mildred (Asian Development Bank); Soco , Christian Flora Mae (Asian Development Bank)
    Abstract: Since the implementation of the Millennium Development Goals, significant global progress has been achieved in promoting gender equality in education and health. However, progress has not been as remarkable in advancing women’s rights on asset ownership and control, which is critical for securing gender equity in economic participation and opportunity, and delivering on the Sustainable Development Goals. Part of the problem comes from the lack of standards on collecting sexdisaggregated data on the topic. The Evidence and Data for Gender Equality (EDGE) initiative aims to develop standardized methods and guidelines for collecting sex-disaggregated data on asset ownership. This paper provides rich inputs to the methodological guidelines being developed by the United Nations and development partners by drawing on the key findings from the pilot surveys conducted in Georgia; Mongolia; and Cavite, Philippines. Furthermore, survey results suggest substantive gender gaps in ownership across different types of assets and countries. These variations confirm the importance of understanding the social norms governing gender roles in society and legislation that can facilitate or impede women’s asset ownership.
    Keywords: asset ownership; gender equality; gender gaps
    JEL: C80 J16 Q15
    Date: 2019–02–26
  37. By: Ha, Joonkyung (Hanyang University); Lee , Sang-Hyop (University of Hawaii at Manoa)
    Abstract: We present three conditions for a demography-driven middle-income trap and show that many economies in East, South, and Southeast Asia satisfy all of them. The conditions are (1) support ratio— the ratio of workers to consumers—matters for economic growth, (2) economic development accompanies more investment in human capital and lower fertility due to the quantity–quality tradeoff, and (3) current low level of fertility corresponds to too low support ratios for keeping up with the frontier economies in the long run. The panel analyses for 178 countries, among which 30 are ADB developing member economies, show that (i) and (ii) are satisfied for Asia with higher elasticity than others. As for (iii), we set up a dynamic model for simulations, showing that about two-thirds of ADB members have unsustainable level of support ratios, implying possibilities of a middle-income trap due to demographic headwinds in the future.
    Keywords: demography; fertility; middle-income trap; national transfer accounts; support ratio
    JEL: J11 O11 O53
    Date: 2018–02–16
  38. By: Ferrarini, Benno (Asian Development Bank); Maupin, Julie (Max-Planck Institute for Comparative Public Law and International Law); Hinojales , Marthe (Asian Development Bank)
    Abstract: This paper takes a first pass at assessing areas of implementation for distributed ledger (or blockchain) technology in the context of development finance. It identifies five use cases, including digital identity, trade finance, project aid monitoring, smart energy, and supply chain management. A discussion of the main benefits, risks and implementation challenges suggests that experimentation with distributed ledger technology can produce immediate significant benefits in some areas, while others require further research and investment, as well as additional technical, infrastructural, or regulatory development. Development lenders can play a role in helping unleash these technologies’ positive developmental impact throughout the Asian region.
    Keywords: blockchain; developing Asia; distributed ledger technology; financial technology
    JEL: G21 M13 O33
    Date: 2017–12–20
  39. By: Ruist, Joakim (Department of Economics, School of Business, Economics and Law, Göteborg University)
    Abstract: This study estimates the fiscal consequences of receiving refugees, over the refugees’ lifetime. It uses data from Sweden in 2015, and the calculations account for refugees’ age, years since immigration, and country of origin. The estimated average annual fiscal net contribution over the lifetime of the average refugee (58 years) ranges from –12 per cent of GDP per capita for refugees from the countries of origin for which labor market performance has historically been the strongest, to –22 per cent for those for which it has been the weakest. The estimates imply that if the European Union received all refugees currently in Asia and Africa, the implied average annual fiscal cost over the same time span would be at most 0.6 per cent of GDP.
    Keywords: refugees; immigration; public finances
    JEL: F22 H20 H50 J61
    Date: 2019–02
  40. By: Cerutti, Eugenio (International Monetary Fund); Claessens, Stijn (Bank for International Settlements); Puy, Damien (International Monetary Fund)
    Abstract: This paper analyzes the behavior of gross capital inflows across 34 emerging markets (EMs), including eight Asian economies. We first confirm that aggregate inflows to EMs comove considerably. Three findings are reported: (i) the aggregate comovement conceals significant heterogeneity across asset types as only bank-related and portfolio bond and equity inflows comove; (ii) while global push factors in advanced economies mostly explain the common dynamics, their relative importance varies by type of flow; and (iii) the sensitivity to common dynamics varies significantly across borrower countries, with market structure characteristics (especially the composition of the foreign investor base and the level of liquidity) rather than a borrower country’s institutional fundamentals strongly affecting sensitivities. Countries relying more on international funds and global banks are found to be more sensitive to push factors. Our findings suggest that EMs need to closely monitor their lenders and investors to assess their inflow exposures to global push factors.
    Keywords: capital flows; emerging markets; global banks; mutual funds; push factors
    JEL: F32 F36 G11 G15 G23
    Date: 2017–11–30
  41. By: Dungey, Mardi (University of Tasmania); Chowdhury, Biplob (University of Tasmania); Kangogo, Moses (University of Tasmania); Sayeed, Mohammad Abu (University of Tasmania); Volkov, Vladimir (University of Tasmania)
    Abstract: Recent international financial crises highlight the advantages of understanding the global financial system as a network of economies in which cross-border financial linkages are fundamental to the spread of systemic risk. We investigate the changing network of financial markets for six periods from 1995–2016, constructing a network that captures the concepts of the direction of links between markets, the significance of these links, and their strength. Emphasis is placed on the transition of the networks before and after the Asian financial crisis of 1997–1998 and the global financial crisis of 2008–2009. The analysis demonstrates the increase in interconnectedness during periods of stress and the fall in the number of links in postcrisis periods. At the same time, the results reveal a general deepening of the connections of the Asian market with the rest of the world over the past 2 decades. They also suggest that many of these markets have transitioned from being primarily linked to developed non-Asian markets through key bridge markets (such as Hong Kong, China) to developing stronger direct links with these external markets, highlighting the importance of key geographical nodes in market development.
    Keywords: Asian markets; financial crises; network
    JEL: G01 G10 G15
    Date: 2018–09–19
  42. By: Anke Mönnig (GWS - Institute of Economic Structures Research); Dr. Marc Ingo Wolter (GWS - Institute of Economic Structures Research)
    Abstract: Das Welthandelsmodell TINFORGE wurde 2014 (Wolter et al. 2014) mit dem Ziel entwickelt, eine möglichst detaillierte Abbildung des Außenhandels in das nationale makroökonometrische Input-Output-Modell INFORGE (Ahlert et al. 2009) zu integrieren. Aufgabe des TINFORGE-Modells ist es, sowohl eine breite Abdeckung an Ländern weltweit zu erreichen als auch eine jährliche Aktualisierbarkeit zu gewährleisten. Die breite Abdeckung von Ländern ist notwendig, weil neue Partnerländer in Afrika oder Asien mit großer Dynamik im Welthandel sichtbar werden (Nigeria, Vietnam) und deren Wirkungen auf den deutschen Export abschätzbar sein sollen. Die jährliche Aktualisierung wird angestrebt, da konjunkturelle Schwankungen und Handelsbarrieren vor allem in den letzten Jahren deutlich zugenommen haben. Deren Wirkungen auch beobachten und nicht nur beschreiben zu können, ist aber Voraussetzung für eine empirisch basierte Projektion des Welthandels. Um also eine schnelle und zeitnahe Aktualisierung zu gewährleisten, wurde TINFORGE entwickelt und seit der Version INFORGE14_1 als integraler Bestandteil für die Abschätzung der Folgen des Welthandels für deutsche Exporte in INFORGE verwendet. Seit der Erstauflage von TINFORGE, welches in Wolter et al. (2014) beschrieben ist, wurde das Modell methodisch fortentwickelt. Dieses Discussion Paper ist ein Update des Papers aus dem Jahr 2014 und beschreibt den aktuellen Modellstand von INFORGE.
    Keywords: Makroökonomischer Modellbau, Welthandel, Bilaterale Handelsmatrizen, Ländermodelle
    JEL: C51 F14 F17
    Date: 2019
  43. By: Lee, Minsoo (Asian Development Bank); Han, Xuehui (Asian Development Bank); Quising, Pilipinas (Asian Development Bank); Villaruel, Mai Lin (Asian Development Bank)
    Abstract: Developing Asia’s infrastructure gap results from both inadequate public resources and a lack of effective channel to mobilize private resources toward desired outcomes. The public–private partnership (PPP) mechanism has evolved to fill the infrastructure gap. However, PPP projects are often at risk of becoming distressed or worst being terminated because of the long-term nature of contracts and the many different stakeholders involved. This paper applies survival time hazard analysis to estimate how project-related, macroeconomic, and institutional factors affect the hazard rate of the projects. Empirical results show that government’s provision of guarantees, involvement of multilateral development banks, and existence of a dedicated PPP unit are important for a project’s success. Privately initiated proposals should be regulated and undergo a competitive bidding to reduce the hazard rate of the project and the corresponding burden to government. Economic growth leads to successful project outcomes. Improved legal and institutional environment can ensure PPP success.
    Keywords: infrastructures; investment policy; public–private partnership; survival analysis
    JEL: F21 H54 H81
    Date: 2018–07–23
  44. By: Dillon, Andrew (Michigan State University); Rao, Lakshman Nagraj (Asian Development Bank)
    Abstract: Agricultural statistics derived from remote sensing data have been used primarily to compare land use information and changes over time. Nonclassical measurement error from farmer self-reports has been well documented in the survey design literature primarily in comparison to plots measured using Global Positioning System (GPS). In this paper, we investigate the reliability of remotely sensed satellite data on nonrandom measurement error and on agricultural relationships such as the inverse land size–productivity relationship and input demand functions. In our comparison of four Asian countries, we find significant differences between GPS and remotely sensed data only in Viet Nam, where plot sizes are small relative to the other countries. The magnitude of farmers’ self-reporting bias relative to GPS measures is nonlinear and varies across countries, with the largest magnitude of selfreporting bias of 130% of a standard deviation (2.2-hectare bias) in the Lao People’s Democratic Republic relative to Viet Nam, which has 13.3% of a standard deviation (.008-hectare bias). In all countries except Viet Nam, the inverse land size–productivity relationship is upwardly biased for lower land area self-reported measures relative to GPS measures. In Viet Nam, the intensive margin of organic fertilizer use is negatively biased by self-reported measurement error by 30.4 percentage points. As remotely sensed data becomes publicly available, it may become a less expensive alternative to link to survey data than rely on GPS measurement.
    Keywords: agriculture; land measurement; remote sensing; survey methods
    JEL: O12 O13 Q12 Q15
    Date: 2018–03–19
  45. By: Hyun, Suk (Korea Capital Market Institute); Park, Donghyun (Asian Development Bank); Tian, Shu (Asian Development Bank)
    Abstract: In this study, we attempt to understand the role of greater access to finance, i.e., stocks, bonds, and bank loans, in public–private partnership (PPP) investment in developing countries. Most developing countries still depend heavily on fiscal financing for infrastructure projects. Our empirical results reconfirm the fact that banks remain the major source of finance for infrastructure projects. The domestic bond market should be further developed to have depth and liquidity enough to provide longterm funding for private sector investors. Interestingly, we find a negative impact of bond market development on PPP investment. A possible interpretation is that financing through government bonds, which dominates bond markets in developing countries, discourages private sector participation by reducing financing access to the corporate bond market. Our evidence underlines the importance of a well-functioning corporate bond market in developing countries, which can offer long-term financing to private sector participation in infrastructure investments.
    Keywords: bond market development; government bond; public–private partnership
    JEL: E20 G10 H00
    Date: 2018–08–07
  46. By: In Hwan Jo (National University of Singapore); Tatsuro Senga (Queen Mary)
    Abstract: Online appendix for the Review of Economic Dynamics article
    Date: 2019
  47. By: Chun, Natalie (Asian Development Bank); Tang, Heiwai (Johns Hopkins School of Advanced International Studies)
    Abstract: This paper studies the effects of firms’ investments in information and communication technologies (ICT) on their demand for female and skilled workers. Using the gradual liberalization of the broadband Internet sector across provinces from 2006 to 2009 as a source of exogenous variation to identify the causal impacts of ICT, we find evidence from the country’s comprehensive enterprise survey data that firms’ adoption of broadband Internet and other related ICT increased their relative demand for female and college-educated workers. The effect of ICT on firms’ female employment is particularly strong among the college-educated workers, and is stronger in industries that are more dependent on highly manual and physical tasks. These results suggest that ICT can lower gender inequality in the labor market by shifting the labor demand from highly manual, routine tasks in which men have a comparative advantage toward more nonroutine, interactive tasks in which women hold a comparative advantage. However, the effect of ICT is weaker in industries relying more on complex and interactive tasks, suggesting that gender differences in education may have limited female labor supply for the most innovative industries that require highly technical skills to complement ICT.
    Keywords: gender inequality; ICT; information technology; infrastructure; wage inequality
    JEL: I24 J16 J21 J22
    Date: 2018–05–22
  48. By: Xu, Yuhong (School of Economics, Singapore Management University); Yang, Zhenlin (School of Economics, Singapore Management University)
    Abstract: We propose score type tests for testing the existence of temporal heterogeneity in slope and spatial parameters in spatial panel data (SPD) models, allowing for the presence of individual-specific and/or time-specific fixed effects (or in general intercept heterogeneity). The SPD model with spatial lag effect is treated in detail by first considering the model with individual-specific effects only, and then extending it to the model with both individual and time specific effects. Two types of tests (naive and robust) are proposed, and their asymptotic properties are presented. These tests are then fully extended to an SPD model with both spatial lag and spatial error effects. Monte Carlo results show that the robust tests have much superior finite and large sample properties than the naive tests. Thus, the proposed robust tests provide reliable tools for identifying possible existence of temporal heterogeneity in regression and spatial coefficients. Empirical illustrations of the proposed tests are given.
    Keywords: Spatial panels; Fixed effects; Time-Varying Covariate Effects; Time-Varying Spatial Effects; Change Points
    JEL: C10 C13 C15 C21 C23
    Date: 2019–01–28
  49. By: Muhammad Halley Yudhistira (Institute for Economic and Social Research, Faculty of Economics and Business, Universitas Indonesia); Regi Kusumaatmadja (Institute for Economic and Social Research, Faculty of Economics and Business, Universitas Indonesia); Mochammad Firman Hidayat (National Planning Agency, Indonesia)
    Abstract: Travel demand restriction is getting popular to disentangle trafic jams in heavily congested urban areas. The policy is easy to implement while reduction in congestion level is perceived to be substantial. We test this hypothesis by evaluating the impact of odd-even policy on congestion level in Jakarta, one of most severe congested cities in the world. Using hourly travel time data at road segment level drawn from GoogleMaps, the odd-even policy reduces the travel time by 3% on average after a month of its implementation. The effect is higher during weekend and at afternoon peak-hour window. Yet, the effect vanishes after the third week of policy introduction. Our result then sheds an indication of ineffective transport demand restriction in Jakarta.
    Keywords: odd-even policy — travel time — Jakarta — trafic demand management
    JEL: R41 R42 R48
    Date: 2018
  50. By: Park, Cyn-Young (Asian Development Bank); Claveria, Racquel (Asian Development Bank)
    Abstract: This paper employs a multidimensional approach to gauge the degree of regional integration and analyze impact on growth, inequality, and poverty. It constructs a multidimensional regional integration index (MDRII) series that embodies six key facets of regional integration: (i) trade and investment, (ii) money and finance, (iii) regional value chains, (iv) infrastructure and connectivity, (v) movement of people, and (vi) institutional and social integration. The MDRII confirms that regional integration is most advanced in the European Union which scores high in all six dimensions; Asia comes second with the largest contribution from infrastructure and connectivity. Empirical analysis suggests significant and positive development impact of regional integration even when trade and financial openness is controlled. The regional value chain, movement of people, and institutional and social integration dimensions have been significant drivers of economic growth. Infrastructure and connectivity improve income distribution. Overall integration alongside the dimensions of trade and investment, money and finance, and institutional and social integration appear to significantly and robustly reduce poverty.
    Keywords: composite index; economic growth; inequality; poverty; regional integration
    JEL: C38 C43 F15 O11
    Date: 2018–10–19
  51. By: Chen, Liming (Institute of International Economics, Nankai University.); Felipe, Jesus (Asian Development Bank); Kam, Andrew J.Y. (National University of Malaysia); Mehta, Aashish (University of California Santa Barbara)
    Abstract: We investigate the claim that national labor markets have become more globally interconnected in recent decades. We do so by deriving estimates over time of three different notions of interconnection: (i) the share of labor demand that is export induced (i.e., all labor demand created by foreign entities buying products exported by the home country)—we provide estimates for 40 countries; (ii) the share of workers employed in sectors producing tradable goods or services—68 countries; and (iii) the ratio of the number of jobs that are either located in a tradable sector, or that are involved in producing services that are required by these tradable sectors, to all jobs in the economy, which we call the trade-linked employment share—40 countries. Our estimates lead to the conclusion that the evidence of a large increase in the interconnections between national labor markets is far weaker than commonly asserted: levels of interconnectivity, and the direction of changes over time, vary across notions of interconnection and countries. The main reasons for this are labordisplacing productivity growth in tradable sectors of each economy and the diminishing fraction of national labor forces hired into manufacturing jobs worldwide. We also discuss the implications of our results for different policy debates that each of the three measures is associated with: international coordination of macroeconomic policies (export-induced labor demand), currency devaluations (share of workers producing tradables), and education and labor protection (trade-linked share).
    Keywords: employment; export induced; globalization; tradable goods; trade-linked employment
    Date: 2018–09–07

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