nep-sea New Economics Papers
on South East Asia
Issue of 2019‒12‒02
thirty-six papers chosen by
Kavita Iyengar
Asian Development Bank

  1. The Effect of Labor Wage on the Labor Productivity of the Indonesian Textile and Garment Industry By Tiara Maharani
  2. Prospects for Decent Work in Services By Khatiwada, Sameer; Flaminiano, John Paul
  3. Transit-Oriented Development Policies and Station Area Development in Asian Cities By Kidokoro, Tetsuo
  4. Options for wind power in Vietnam by 2030 By Minh Ha-Duong; Sven Teske; Dimitri Pescia; Mentari Pujantoro
  5. The adoption of mechanization, labour productivity and household income: Evidence from rice production in Thailand By Srisompun, Orawan; Athipanyakul, Thanaporn; Isvilanonda, Somporn
  6. Capital Flow Dynamics in Emerging Market Economies By Masahiro Enya; Akira Kohsaka; Kimiko Sugimoto
  7. Technical Efficiency Analysis Of Indonesian Small And Micro Industries: A Stochastic Frontier Approach By Hery Purnomo Tunggal; Tati Suhartati Joesron
  8. Masyarakat Akademik dan Politik Penerbitan Ilmiah di Indonesia By Seftyono, Cahyo
  9. Environmental fixes and historical trajectories of marine resource use in Southeast Asia By Wehner, Nicholas; Fabinyi, Michael
  10. Political Competition and Local Government Performance: Evidence from Indonesia By Rezki, Jahen Fachrul
  11. The Effects of the Vietnam Hunger Eradication and Poverty Reduction Program on Schooling By Bertoni, Marco; Huynh, Quynh; Rocco, Lorenzo
  12. The Impact of Fiscal Decentralization on Regional Economic Growth and Regional Income Disparity in Indonesia (Case Study: West Sumatra Province during the period 2011 - 2017) By Defri Kurniawan
  13. Social Interventions, Health and Wellbeing: The Long-Term and Intergenerational Effects of a School Construction Program By Mazumder, Bhashkar; Rosales, Maria Fernanda; Triyana, Margaret
  14. Inequality and Political Trust in Indonesia By Eldes Natalya Hutagalung
  15. Environmental Governance and Environmental Performance By Chang, Chun-Ping; Dong, Minyi; Liu, Jiliang
  16. Challenges in Implementing the Credit Guarantee Scheme for Small and Medium-Sized Enterprises: The Case of Viet Nam By Dang, Le Ngoc; Chuc, Anh Tu
  17. To Move Home or Move On? Investigating the Impact of Recovery Aid on Migration Status as a Potential Tool for Disaster Risk Reduction in the Aftermath of Volcanic Eruptions in Merapi, Indonesia By Muir, Jonathan A.; Cope, Michael R.; Jackson, Jorden E.; Angeningsih, Leslie R.
  18. Impact of Co-firing Straw for Power Generation to Air Quality: A Case Study in Two Coal Power Plants in Vietnam By A. H. Truong; Minh Ha-Duong
  19. Health shocks and risk aversion: Panel and experimental evidence from Vietnam By Priebe, Jan; Rink, Ute; Stemmler, Henry
  20. Big Data-Based Peer-to-Peer Lending Fintech: Surveillance System through Utilization of Google Play Review By Pranata, Nika; Farandy, Alan Ray
  21. Firm Adjustment to Trade Policy Changes in East Asia By Narjoko, Dionisius; Urata, Shujiro
  22. Call Your Leader: Does the Mobile Phone Affect Policymaking? By Rezki, Jahen Fachrul
  23. The Promise and Pitfalls of Conflict Prediction: Evidence from Colombia and Indonesia By Bazzi, Samuel; Blair, Robert A.; Blattman, Chris; Dube, Oeindrila; Gudgeon, Matthew; Peck, Richard
  24. Impact of institutional and cultural distance on ASEAN's trade efficiency By Doanh Khanh Nguyen; Van Ngoc Thi Pham; Heo, Yoon
  25. An Economic Analysis of China’s Domestic Crude Oil Supply Policies By Philipp Galkin; Carlo Andrea Bollino; Simona Bigerna
  26. The World Economic Slowdown and the Asian and Latin American Economies By Hughes, Alan; Singh, Ajit
  27. A Skeptical Note on the Role of Constant Elasticity of Substitution in Labor Income Share Dynamics By Paul, Saumik
  28. Towards Integrated Business Resilience Model Against Business Crisis in China, Japan, and South Korea-Comparative Case Study on Sanlu, Toyota, and Samsung By Weng Xuanbin
  29. Social Protection and Women Workers in Asia By Moghadam, Valentine M.
  30. Mean Reversion in Asia-Pacific Stock Prices: New Evidence from Quantile Unit Root Tests By Gilbert V. Nartea; Harold Glenn A. Valera; Maria Luisa G. Valera
  31. Participación de la fuerza de trabajo de mujeres en los sectores económicos de América Latina, durante el siglo XX By Silvana Maubrigades
  32. The Rise of the People’s Republic of China and its Competition Effects on Innovation in Japan By Yamashita, Nobuaki; Yamauchi, Isamu
  33. Internal and External Determinants of Housing Price Booms in Hong Kong, China By Taghizadeh-Hesary, Farhad; Yoshino, Naoyuki; Chiu, Alvin
  34. Adverse Selection and Credit Certificates: Evidence from a P2P Platform By Hu, Maggie Rong; Li, Xiaoyang; Shi, Yang
  35. A Moving Average Heterogeneous Autoregressive Model for Forecasting the Realized Volatility of the US Stock Market: Evidence from Over a Century of Data By Afees A. Salisu; Rangan Gupta; Ahamuefula E. Ogbonna
  36. The Subversion of Shareholder Democracy and the Rise of Hedge-Fund Activism By Jang-Sup Shin

  1. By: Tiara Maharani (Master of Applied Economics, Padjadjaran University)
    Abstract: The textile and garment industry is one of the leading industries in Indonesia. However, the industry has been facing a problem with the increase in labor wage, which has in turn increased the cost of production and led to a decrease in competitiveness. Therefore, the competitiveness can be increased by increasing labor productivity. This paper investigated the correlation between labor productivity, labor wage, and other factors such as capital and firm ownership in the Indonesian textile and garment industry by employing a cross-sectional methodology for the periods 2000, 2005, 2010, and 2015. By utilizing the Indonesian Medium and Large Manufacturing Survey, particularly in the context of the spinning, weaving, and apparel subsectors, we found that in the weaving and apparel subsectors, labor wage has a positive correlation with labor productivity. Furthermore, the estimated results indicated that labor productivity is affected by an increase in capital, especially in companies with foreign ownership. The result also suggested that labor wage can be utilized to boost labor productivity; hence, there should be more opportunities for foreign ownership in the Indonesian textile and garment industry.
    Keywords: labor productivity, competitiveness
    JEL: J3
    Date: 2019–11
  2. By: Khatiwada, Sameer (Asian Development Bank Institute); Flaminiano, John Paul (Asian Development Bank Institute)
    Abstract: We examine how the services sector could provide decent and gainful employment in developing Asia. Using living wages as a reference point, we report that a significant portion of the workforce in developing Asian economies, the majority of which are employed in the agricultural sector, are not living wage earners. On the other hand, manufacturing, and to a larger extent, services, are able to provide their workforce with good jobs. Economies that are more successful at moving workers from low- to high-productivity sectors have done better on job creation accompanied with improved productivity, higher wages, and large reductions in poverty. Recent developments of information and communication technology industries, as in the case of India and the Philippines, is a striking example of how developing economies can open up business opportunities through global outsourcing of tradable labor. We highlight the importance of improving human capital through education and upskilling, as well as physical and digital infrastructure, to address the large supply of low-productivity and informal sector workers in developing Asia, and to provide new and gainful employment opportunities.
    Keywords: decent jobs; modern services; living wages; technology; tradability
    JEL: J30 L80 O14 O40 O47 O53
    Date: 2019–04–05
  3. By: Kidokoro, Tetsuo (Asian Development Bank Institute)
    Abstract: Many metropolitan cities in Asia are planning and implementing extensive investment in mass transit networks and thus are now on the threshold of becoming transit cities or car traffic saturation cities. The promotion of transit-oriented development (TOD) policies will be a key to the progression to transit cities. TOD should consider a transit-oriented regional growth management plan, station area zoning regulations (mixed-use, minimum density, maximum parking, etc.), joint development among local governments, transit agencies, and private developers, and an institutional mechanism for public and private cooperation in station area development. We examine cases from cities in Japan, the United States (US), and Southeast Asia, including Tokyo and Toyama in Japan, Denver in the US, and Kuala Lumpur in Malaysia. We conclude that the following are factors for the successful implementation of TOD in Asian cities: a shift from highway-based zoning to transit-oriented zoning; the creation of an institutional mechanism for public and private cooperation in station area development; a balance between public benefit and private benefit; the connection of transit services and affordable housing; and multi-modal connection planning, including walking.
    Keywords: asia; mass transit network; metropolitan cities; transit cities; transit-oriented development; urbanization
    JEL: O18 R42 R51 R58
    Date: 2019–05–08
  4. By: Minh Ha-Duong (VIET - Vietnam Initiative for Energy Transition, CIRED - Centre International de Recherche sur l'Environnement et le Développement - CIRAD - Centre de Coopération Internationale en Recherche Agronomique pour le Développement - EHESS - École des hautes études en sciences sociales - AgroParisTech - ENPC - École des Ponts ParisTech - CNRS - Centre National de la Recherche Scientifique); Sven Teske (UTS - University of Technology Sydney); Dimitri Pescia (Agora Energiewende); Mentari Pujantoro
    Abstract: Vietnam has an excellent wind resource, and the cost of producing electricity from wind has decreased continuously over the last decade. After the feed in tariff for onshore wind power was raised to 8.5 UScents / kWh in 2018, the sector is finally taking off. The inventory of existing onshore wind power projects in Vietnam shows that the sector is on track to meet the government targets for 2020 and 2025. We explored three scenarios for wind power development in Vietnam up to 2030 and conclude that the wind power installed capacity by that year could be 12-15 GW onshore, 10-12 GW offshore. The policy implications are that first, the next power development plan of Vietnam provides an important opportunity to increase at low costs the level of ambition of wind power development. Second, flexibility should be the guiding principle of that plan. Third, to realize the large potential of offshore wind power, infrastructure planning has to start soon.
    Keywords: wind energy,Vietnam,scenarios 1
    Date: 2019–10–23
  5. By: Srisompun, Orawan; Athipanyakul, Thanaporn; Isvilanonda, Somporn
    Abstract: The planning of mechanization requires the quantitative assessment of a mechanization index and the impact of this index on agricultural yield and economic factors. The purpose of this paper is to investigate the effect of the adoption of agricultural mechanization and scale production on labour productivity and the generation of income for farmers. Cross-sectional data for jasmine rice production by 569 households in 1,003 plots in the north eastern part of Thailand in 2017 were employed. The study found that the average rice planting workforce and labour productivity have an inverse relationship with planted area, while large farms have the highest ratio for machine labour to workforce. The rice yield, labour usage and labour productivity of the farmers varied by mechanization level (ML) and farm size while different levels of Machinery Owned labour (MO) have no effect on rice yield. Therefore, there are three main suggestions: 1) performing land consolidations, since applying a production strategy with large rice paddies may increase labour productivity and the net profit of rice famers; 2) improving the quality of machinery for use in rice production in Thailand, especially the performance of the machinery to prevent losses during harvest; and 3) increasing the mechanization level to 50-75%, which could also increase labour productivity and net returns.
    Keywords: Family labour, Farm size, Hired labour, Multivariate analysis-of-variance, Pillai's statistics, Production cost, Rice yield, Small farm
    JEL: Q12 Q16 Q18
    Date: 2019–11
  6. By: Masahiro Enya (Faculty of Economics and Management, Institute of Human and Social Sciences, Kanazawa University); Akira Kohsaka (Osaka School of International Public Policy, Osaka University); Kimiko Sugimoto (Hirao School of Management, Konan University)
    Abstract: This paper analyzes the dynamics of gross capital flows since the 1990s across three regions, i.e. East Asia, Europe and Latin America, and across types of capital flows, i.e. foreign direct investment, portfolio equity flows, portfolio debt flows and other investment. First, we demonstrate distinct features of gross capital inflows and outflows with selected EMs across the three regions by types of capital flows. Then, using panel data regression in the period of 2000-2015, we show how both domestic and global factors contribute to the dynamics of these gross capital flows. We confirm that both global factors such as expected growth and international investors’ risk perception in AEs, and domestic factors such as exchange rate regimes, and financial deepening in EMs, contribute to the dynamics. Furthermore, we detect significant regional diversities in relative importance and sensitivities in the roles of these factors.
    Keywords: Tenure; Managerial Skill; gross capital flows, emerging market economies (EMs), types of capital flows, Asian Financial Crisis, Global Financial Crisis
    JEL: F3 F4 F6
    Date: 2019–11
  7. By: Hery Purnomo Tunggal (Master of Applied Economics, Padjadjaran University); Tati Suhartati Joesron (Master of Applied Economics, Padjadjaran University)
    Abstract: Indonesian small and micro industries (SMIs) grow rapidly, followed by the shifting of the agricultural sector to manufacturing sector. However, its low contribution to national economy indicates there are encountered problems of productivity and efficiency. The goal of this study is analyzing technical efficiency of Indonesian SMIs categorized by size and five subsectors classified by Indonesia Standard Industrial Classification (ISIC). This study examines crosssectional data from survey of Indonesian small and micro industries (VIMK) in 2014 estimated statistically using Stochastic Frontier Analysis (SFA). The results show that SMIs are labor intensive business, yet it faces diseconomies of scale. Hence, the role of capital increase should not be ignored. The key findings are mainly female ownership in the food processing industry positively contribute to efficiency improvement, the greater the sales the more efficient the business will function, younger entrepreneur is more efficient to manage several subsectors and access to financial sources positively contribute to efficiency improvement in clothing industry. Empowerment strategy to improve technical efficiency of SMIs should emphasis on intensively vocational/entrepreneurial training particularly for female and younger entrepreneurs, promotion for network building activity and deregulating microcredit scheme, especially for clothing industry.
    Keywords: small and micro industries, efficiency, stochastic frontier analysis
    JEL: L0
    Date: 2019–11
  8. By: Seftyono, Cahyo
    Abstract: Penelitian ini membahas tentang politik penerbitan ilmiah di Indonesia. Fokus yang diamati adalah masyarakat akademik secara spesifik Relawan Jurnal Indonesia. Melalui pendekatan masyarakat sipil dan perubahan institusi hendak dilacak format baru masyarakat sipil yang dapat beradaptasi pada kebijakan dan realitas masyarakat yang sesuai dengan visi misi pembentukan organisasi.
    Date: 2019–04–25
  9. By: Wehner, Nicholas (OCTO (Open Communications for The Ocean)); Fabinyi, Michael
    Abstract: This paper emphasises the long-term historical trajectories of marine resource use in the Philippines through an examination of successive environmental fixes. Based on fieldwork from coastal Mindoro province, the paper shows how the technological intensification and geographical expansion of fisheries, the development of aquaculture and the promotion of tourism represent three forms of environmental fixes that aim to address the problems caused by marine resource declines and subsequent lack of availability of means of production. All three fixes have struggled to reduce environmental pressure or provide a long-term basis for livelihoods. The paper argues that viewing how successive types of environmental fixes unfold over long periods of time highlights how marine resource declines are part of much wider economic and historical processes, with consequent implications for livelihoods and governance.
    Date: 2018–03–05
  10. By: Rezki, Jahen Fachrul
    Abstract: This paper analyses the impact of political competition on local government performance in Indonesia. This study uses a new database that covers 427 districts in Indonesia, from 2000 to 2013. In Indonesia, local governments are largely responsible for fulfilling basic service delivery and, in this regard, they are extremely powerful. Political competition is measured using the Herfindahl Hirschman Concentration Index for the district parliament election. This variable is potentially endogenous, because political competition is likely to be non-random and correlated with unobservable variables. To solve this problem, I use the lag of political competition for neighbouring districts within the same province, as well as the political competition from the 1955 general election, as instrumental variables for political competition. The degree of political competition has been found to boost real Regional Gross Domestic Product (RGDP) per capita by 1.9%. Furthermore, a one standard deviation increase in political competition would increase RGDP growth by approximately 0.81%. The results also support the findings of previous studies, which have found that stiffer political competition is associated with higher public spending (e.g. infrastructure spending) and pro-business policies.
    Date: 2018–11–23
  11. By: Bertoni, Marco (University of Padova); Huynh, Quynh (University of Padova); Rocco, Lorenzo (University of Padova)
    Abstract: This paper studies the effects of the Vietnam Hunger Eradication and Poverty Reduction (HEPR) program on school enrolment, using longitudinal data that span over 15 years and a difference-in-differences research design. We find that early treatment (at age 8) increases children enrolment by about 9 percent. This positive effect disappears by age 15, and is more pronounced in urban areas. In sharp contrast, children receiving treatment later (age 12–15) are more likely to drop out by age 15, especially in rural areas. The decline in enrolment is paralleled by an increase in labor market participation. We interpret these divergent results by age as an unintended effect of another program aimed at fostering vocational training among the 15+ in rural areas. Our findings highlight the importance of integrating different anti-poverty measures to reduce inefficiency and achieve social goals.
    Keywords: child poverty, child education, enrolment, Vietnam, poverty reduction
    JEL: H52 H53 I24 I32
    Date: 2019–11
  12. By: Defri Kurniawan (Master of Applied Economics, Padjadjaran University)
    Abstract: This study aims to analyze the impact of fiscal decentralization on regional economic growth and also investigate its influence on regional income disparity, particularly among regencies and municipalities in West Sumatra Province during the period from 2011 until 2017. The panel data model is applied on this study involving 19 (nineteen) regencies and municipalities in West Sumatra Province. As the results, fiscal decentralization which devolves the authority to collect local own revenue (PAD) prove not to promote distinguishable regional economic growth and also it contributes positively to regional income disparity. Conversely, the combination of local own revenue and intergovernmental transfer affect the positive contribution to regional economic growth and also narrowing the gap of regional income disparity. This research suggests that the intergovernmental transfer as an implication of the fiscal decentralization is still required by the regional government (cities and regencies) to support their financial resources, particularly in West Sumatra Province case. Moreover, allocating more budget on capital expenditure exhibits beneficial result to increase regional economic growth.
    Keywords: Fiscal decentralization, income disparity, regional, Indonesia
    JEL: H3
    Date: 2019–11
  13. By: Mazumder, Bhashkar (Federal Reserve Bank of Chicago); Rosales, Maria Fernanda (Rutgers University); Triyana, Margaret (Federal Reserve Bank of Chicago)
    Abstract: We analyze the long-run and intergenerational effects of a large-scale school building project (INPRES) that took place in Indonesia between 1974 and 1979. Specifically, we link the geographic rollout of INPRES to longitudinal data from the Indonesian Family Life Survey covering two generations. We find that individuals exposed to the program have better health later in life along multiple measures. We also find that the children of those exposed also experience improved health and educational outcomes and that these effects are generally stronger for maternal exposure than paternal exposure. We find some evidence that household resources, neighborhood quality, and assortative mating may explain a portion of our results. Our findings highlight the importance of considering the long-run and multigenerational benefits when evaluating the costs and benefits of social interventions in a middle-income country.
    Keywords: Intergenerational transmission of human capital; education; adult wellbeing; income
    JEL: I38 J13 O15
    Date: 2019–10–28
  14. By: Eldes Natalya Hutagalung (Master of Applied Economics, Padjadjaran University)
    Abstract: Inequality persists across the world. Numerous social and political consequences emerge due to the wide gap between the rich and the poor. For politics, previous empirical studies confirm that higher inequality is associated with a decline of political trust, which may hurt a country’s democratic legitimacy. In a highly unequal society, poor citizens feel worse off and are likely to blame the government for their situation. They judge the government as unfair for giving special treatment to the rich, as its policies mostly reflect the preferences of upper-income groups. This pattern should be particularly accentuated in Indonesia. Given the country’s large income inequality, the issue of political trust has been attracting public concern. This study therefore aims to verify the negative effect of inequality on political trust at the district level. We look at five different governmental entities–the presidency, the house of representatives, governors, police, and the court system–to analyze political trust. Unexpectedly, our results do not agree with previous studies. They show that there is no evidence that inequality dampens political trust in Indonesia. The coefficients of inequality measurements are positive, implying that households in unequal districts on average exhibit more trust in government. The change in inequality shows, however, the negative effect on political trust because as inequality decreases or increases, households’ level of trust in government will increase or decrease in turn.
    Keywords: Political Trust, Inequality, Change of Inequality
    JEL: I3
    Date: 2019–11
  15. By: Chang, Chun-Ping (Asian Development Bank Institute); Dong, Minyi (Asian Development Bank Institute); Liu, Jiliang (Asian Development Bank Institute)
    Abstract: Along with the continuous development of the global economy, environmental deterioration has been widely recognized as a pressing issue nowadays, bringing environmental governance to the forefront of human survival. Asia, the largest continent in world in terms of both landmass size and population, has long been facing the exhaustive challenge of environmental pollution. We empirically prove that the level of environmental governance, proxied by government expenditure on environmental protection as a share of gross domestic product (GDP), exerts significant impacts on environmental conditions among Asian countries. For Asian countries, basically three main conclusions can be drawn that may be useful for improving the condition of environmental quality: (i) the authority should increase the share of government expenditure on environmental protection, since it contributes significantly to the reduction of CO2 emissions and the promotion of energy efficiency; (ii) the government should make an effort to control the overheating economic growth, since excessive economic growth is detrimental to the environment, and increasing GDP per capita leads to increasing CO2 emissions, decreasing energy efficiency, and decreasing comprehensive environmental performance; and (iii) although foreign direct investment has no impact on CO2 emissions and the Environmental Performance Index, it exerts a significantly negative impact on energy intensity and thus promotes an effect on energy efficiency; therefore, we recommend that the government should implement relevant policies to attract more foreign investment.
    Keywords: environmental performance; environmental governance; government expenditure
    JEL: H11 Q56 Q58
    Date: 2019–03–25
  16. By: Dang, Le Ngoc (Asian Development Bank Institute); Chuc, Anh Tu (Asian Development Bank Institute)
    Abstract: Access to credit is still one of the greatest obstacles to the growth of small and medium-sized enterprises (SMEs) in Viet Nam. To date, only 39% of SMEs have bank loans. To cater to SMEs’ need for financial sources, especially formal sources such as the banking system, the Vietnamese government has implemented a large number of supporting programs, including the credit guarantee scheme (CGS) for SMEs, which it established in 2001. Through collecting, synthesizing, and analyzing data, we aim to study the challenges involved in implementing CGSs for SMEs as well as the causes of their poor performance. The fundamental reasons we find include the strict and impractical conditions for issuing credit guaranteed loans; the lack of adequate professional competence of staff involved in the credit guaranteeing task; the fragmented relationship between the credit institution and the CGS; and the lack of a credit database platform that facilitates access to finance for SMEs by providing comprehensive and reliable creditworthiness.
    Keywords: credit for SMEs; Vietnamese business environment; SMEs in Viet Nam
    JEL: E51 G23 G28 H81
    Date: 2019–04–08
  17. By: Muir, Jonathan A.; Cope, Michael R.; Jackson, Jorden E.; Angeningsih, Leslie R.
    Abstract: Disasters are associated strongly with forced migration. Indeed, migration is a standard survival strategy for those facing disruptions of this kind. Such is the case with Mt. Merapi, Indonesia, where a series of eruptions occurred in 2010. Mechanisms related to forced migration in such scenarios are fairly well understood, yet it remains less clear what factors may influence return migration. Given local interest in facilitating resettlement out of hazardous areas as a means of risk reduction, we seek to better understand the extent to which recovery aid may create incentives for households to move on rather than move home. We draw upon data collected from a pilot study in the aftermath of the 2010 eruptions and use multinomial logistic regression models to explore the influence of various forms of aid on migration status. Of the various forms of aid considered, financial recovery aid provided to households was consistently associated with moving on. The combination of financial recovery aid with remittances resulted in an association with having moved on that was even stronger than just receiving financial recovery aid. Ultimately, analyses of "aid packages'" suggest that a combination of most, if not all, of the aid was relatively more effective in fostering resettlement, suggesting that while food and health recovery aid as well as remittances may not have been sufficient in and of themselves to increase resettlement, they may enhance the effect of financial recovery aid.
    Date: 2019–05–06
  18. By: A. H. Truong (Centre for Research and Technology Transfer - VAST - Vietnam Academy of Science and Technology); Minh Ha-Duong (CIRED - Centre International de Recherche sur l'Environnement et le Développement - CNRS - Centre National de la Recherche Scientifique - ENPC - École des Ponts ParisTech - CIRAD - Centre de Coopération Internationale en Recherche Agronomique pour le Développement - EHESS - École des hautes études en sciences sociales - AgroParisTech)
    Abstract: Open field burning of rice straw regularly contributes to severe air quality issues affecting millions of inhabitants in the city of Ha Noi. We examine how much replacing open field burning by co-firing mitigates local air pollutants and greenhouse gases emissions. We select two coal power plants located in the North of Vietnam as specific examples. Our findings show that co-firing straw in these plants at 5% mixing ratio on heat basis can reduce greenhouse gas emission as well as air pollutant emissions (SO 2 , PM10 and NO x) from 3% up to 13%. We examined the social value of these emission reductions using external costs factors. The health benefits of improving air quality by disposing of straw at a large coal power plant instead of open field burning are over ten million USD per year. This is the same order of magnitude as the technical costs of co-firing. Greenhouse gas emissions reduction benefits appear smaller.
    Date: 2018
  19. By: Priebe, Jan; Rink, Ute; Stemmler, Henry
    Abstract: This paper looks at individual risk behavior and disability in Vietnam, where many households live with a disabled family member. Due to the Vietnam war, disability is a common phenomenon and shapes individuals’ daily life and decision making. Using longitudinal data of 2200 households in Vietnam and an instrumental variable strategy, we show that individuals who live with a disabled family member are more risk averse than others. In addition we employ field experiments and psychological primes to elicit risk and loss behavior of individuals living in the Vietnam province Ha-Thinh. The experimental results, underpin our panel results. We show in addition that a negative recollection of health issues, leads to a lower risk attitude of individuals who do not live with a disabled family member and that individuals who live with a disabled family member are less loss averse. Our findings are causal and contribute to existing studies showing that households who are characterized by higher backward risks are more risk averse than others.
    Keywords: Risk, Disability, Vietnam
    JEL: D1 I14 Z1
    Date: 2019–08
  20. By: Pranata, Nika (Asian Development Bank Institute); Farandy, Alan Ray (Asian Development Bank Institute)
    Abstract: Peer-to-peer lending (P2PL) FinTech is growing rapidly in Indonesia. With its flexibility and simplicity, P2PL reduces the financing gap that cannot be fulfilled by banks. However, the rapid development of P2PL also raises a number of problems that burden users such as unethical debt collection methods and the imposition of excessive interest rate and other costs that potentially threaten national financial system stability. Therefore, by utilizing big data, which in this case is 40,650 reviews from 110 P2PLs obtained from Google Play from March 2016 to August 2018, we build a big data-based P2PL surveillance system based on four aspects: legality, review rating, debt collection methods, and level of interest rates and other costs. By using relational database, structured query language (SQL), and text analysis, we found that (i) the majority of P2PL in Google Play are unauthorized; (ii) on average, authorized P2PL receives a better review rating; (iii) there are a lot of negative reviews related to unethical debt collection methods and excessive imposition of interest rate; and (iv) four P2PLs required special supervision from the Indonesia Financial Service Authority (OJK). Furthermore, the OJK should not passively wait for official reports to be filed by the public regarding violations of P2PL businesses. Through this big data-based system, the OJK can find these violations proactively because the system can act as an early warning system for the OJK in terms of P2PL surveillance.
    Keywords: fintech; peer to peer lending; big data; review; Google Play
    JEL: G23 G24 G28
    Date: 2019–04–12
  21. By: Narjoko, Dionisius (Asian Development Bank Institute); Urata, Shujiro (Asian Development Bank Institute)
    Abstract: Trade and investment liberalization has been one of the key features of economic policy in many developing countries since the 1990s. Research on this subject has consistently produced more evidence on the benefits of globalization; theoretical studies give more attention to what happens within an industry when trade and liberalization occur, while empirical studies confirm the positive impact of trade liberalization. We review some recent studies on the subject of firms in a globalized economy to enable us to understand more about how firms respond to globalization or changes in trade and investment liberalization. We focus on presenting or explaining the underlying mechanisms through which the effects are realized. The studies we summarized generally confirm the positive impact of trade liberalization on productivity or the spectrum of measures reflecting productivity, such as product quality, firm size, or skill intensity. The positive impact goes through various channels, including competition and industry dynamics, exporting and innovation decisions, and production or investment decisions.
    Keywords: trade liberalization; investment liberalization; globalization; productivity
    JEL: F01 F60 O14 O53
    Date: 2019–05–06
  22. By: Rezki, Jahen Fachrul
    Abstract: This paper analyses the impact of Information and Communication Technology (ICT) on policymaking on an Indonesian Village level. In this study, I use data from different waves of the Indonesian Village Potential Statistics (Potensi Desa) to determine whether mobile phone signal strength affects village policies and civic engagement activities. The results indicate that villages with a strong signal are statistically more likely to possess the proper infrastructure and economic programs. Furthermore, mobile phones increase civic engagement, which is consistent with previous studies related to collective action or mass mobilisation. Using the plausibly exogenous variation of lightning strike intensity as the instrumental variable, this study suggests that higher mobile phone signal strength is positively associated with the policies implemented by the village head. This study also demonstrates that ICT has a stronger effect in rural areas. One possible explanation is that mobile phones improve the relative ability for rural people to interact with their leaders. Another potential answer is the fact that there are significant differences between rural village and urban village governments, which could also affect policymaking.
    Date: 2018–11–23
  23. By: Bazzi, Samuel; Blair, Robert A.; Blattman, Chris; Dube, Oeindrila; Gudgeon, Matthew; Peck, Richard
    Abstract: Policymakers can take actions to prevent local conflict before it begins, if such violence can be accurately predicted. We examine the two countries with the richest available sub-national data: Colombia and Indonesia. We assemble two decades one fine- grained violence data by type, alongside hundreds of annual risk factors. We predict violence one year ahead with a range of machine learning techniques. Models reliably identify persistent, high-violence hot spots. Violence is not simply autoregressive, as detailed histories of disaggregated violence perform best. Rich socio-economic data also substitute well for these histories. Even with such unusually rich data, however, the models poorly predict new outbreaks or escalations of violence. \Best case" scenarios with panel data fall short of workable early-warning systems.
    Date: 2019–06–11
  24. By: Doanh Khanh Nguyen; Van Ngoc Thi Pham; Heo, Yoon
    Abstract: This paper aims to analyze the impact of institutional and cultural distance on ASEAN's trade efficiency using bilateral trade data from 2006 to 2016. The authors first employ an improved version of the stochastic frontier model to control endogeneity in estimating efficiency scores and then apply a sys-GMM model to estimate the impact of various distances on trade efficiency. The major findings are summarized as follows: first, trade efficiency of ASEAN's with the rest of the world is moderate, ranging from 0.48 to 0.60, and shows a downward trend. This indicates that considerable trade potential exists between ASEAN countries and the rest of the world. Second, institutional and cultural distance negatively affects ASEAN's trade efficiency. Third, trade freedom is an important factor that positively influences ASEAN's trade efficiency. Based on these findings, this study concludes that efforts to reduce differences in institutions and culture and to promote trade liberalization are strongly suggested as remedies for ASEAN countries to turn potential trade performance into actual trade performance.
    Keywords: trade efficiency,endogenous stochastic frontier model,endogeneity,system GMM,ASEAN
    JEL: F14 C55 F15
    Date: 2019
  25. By: Philipp Galkin; Carlo Andrea Bollino; Simona Bigerna (King Abdullah Petroleum Studies and Research Center)
    Abstract: The idea of energy security emerged after the energy crises of the 1970s. It has evolved from the initial paradigm of assuring sufficient energy supplies to include a price affordability perspective and, eventually, many other energy-related issues, such as infrastructure, environmental impacts, societal effects, energy efficiency and governance. However, security of physical supply and price affordability remain the paradigm’s two key pillars. This study applies financial portfolio theory to the energy security issues of East Asia’s four major energy importers: China, Japan, South Korea and Taiwan. The authors calculate the relative risks associated with the dynamics of oil imports, and the import prices paid, and estimate the efficient frontiers for corresponding import portfolios. Lastly, the study runs several scenarios that simulate the effects of restructuring the four countries’ oil import portfolios and of external disruptions, notably US sanctions on Iranian oil sales.
    Keywords: Crude Oil Trade, Economic Sanctions, Energy Security, Import Demand Elasticity (IDE), South Korea, Taiwan
    Date: 2019–05–28
  26. By: Hughes, Alan; Singh, Ajit
    Keywords: International Development
  27. By: Paul, Saumik (Asian Development Bank Institute)
    Abstract: The constancy of the elasticity of factor substitution (σ) makes its role as a driver of the labor income share exogenous. The constant elasticity of substitution (CES) production function has predominantly been used to support this causal relationship. We argue that (i) capital-labor ratio determines the value of σ, and (ii) both capital-labor ratio and σ vary over time. We use a variable elasticity of substitution (VES) production framework that allows both labor income share and σ to change over time. Statistically significant empirical support is provided using the Japanese industrial productivity data. This suggests that the CES model may not be an ideal choice to examine the factor income share dynamics.
    Keywords: substitution elasticity; labor income share; production function parameters
    JEL: E21 E22 E25
    Date: 2019–04–22
  28. By: Weng Xuanbin
    Abstract: No matter how big companies emphasize their business transparency and business ethics, scandals never stopped showing up in the business world, including in East Asia. Business is the footstone of the economy; hence, it is critical for firms to avoid corporate scandal to escape from breakdown by look deep into the technical details of the mechanism of formation of business scandals in the dominant economy entities in the region, which are China, Japan, and South Korea. This paper examines the reasons for the risen of massive corporate public scandals of the key business players in each countries f in respective industries via deploying the Stage Model proposed by Turner and Kayes (2015). With offering the timeline of business scandals of Sanlu, Toyota, and Samsung, a detailed comparative analysis focused on the similarities and differences originated from the views of business strategy, business resilience, and corporate social responsibility (CSR). This paper introduces the relative academic implication and empirical implications in the later section as well for highlighting the advantages and disadvantages of the existing theory and the lessons learned from the three cases.
    Date: 2019–10
  29. By: Moghadam, Valentine M.
    Keywords: International Development
  30. By: Gilbert V. Nartea (University of Canterbury); Harold Glenn A. Valera; Maria Luisa G. Valera
    Abstract: We investigate the stationarity of real stock prices among 12 Asia-Pacific countries over the period 1991–2018. The methodology employed is driven by the need to address three key concerns: (i) the identification of which positive or negative shocks are linked to stationarity; (ii) the identification of different speeds of adjustment towards long-run equilibrium; and (iii) the identification of mean reversion and potential asymmetric speed of adjustment before and after the 2008-2009 global financial crisis. To meet these concerns, we examine the time series properties of the data within a quantile unit root testing framework. Our results generally indicate that real stock prices are stationary at the upper quantiles only. There is also evidence of a varied speed of adjustment process across the quantiles where stationarity is present. Further analysis indicates that real stock prices became much more reverting and with a faster speed of adjustment after the global financial crisis, except for Japan and New Zealand.
    Keywords: Stock prices, Mean reversion, Quantile unit root regression
    JEL: C1 C5 G1
    Date: 2019–11–01
  31. By: Silvana Maubrigades (Programa de Historia Económica y Social, Facultad de Ciencias Sociales, Universidad de la República)
    Abstract: Este artículo analiza la evolución de la participación laboral de las mujeres en América Latina y su vínculo en relación a los procesos de desarrollo económico presentes en la región. Por un lado, se indaga la presencia de una curva en forma de “U” en el proceso de incorporación de mujeres al mercado de trabajo. Conjuntamente, se compararán las tendencias latinoamericanas con las observadas en países desarrollados y con una muestra de países de Asia, otra región en proceso de desarrollo, a los efectos de identificar la posible presencia de un patrón de incorporación de las mujeres al mercado laboral característico de América Latina. Por otro lado, al interior de América Latina, se presentan resultados comparados entre los diferentes grupos de países previamente identificados en la región y se analizan las tendencias desiguales en el proceso de incorporación de las mujeres a la fuerza de trabajo, en el contexto de los diferentes modelos de desarrollo a lo largo del siglo XX. Se trata de probar la existencia de una interacción entre el modelo económico vigente, en diferentes períodos de tiempo en la región, y las tasas de actividad de las mujeres.
    Keywords: mercado de trabajo, género, segregación laboral, América Latina.
    JEL: J16 J21 N36
    Date: 2018–12
  32. By: Yamashita, Nobuaki (Asian Development Bank Institute); Yamauchi, Isamu (Asian Development Bank Institute)
    Abstract: This paper empirically examines the “defensive innovation” hypothesis that firms with higher exposure to low-wage economy import competition intensively undertake more innovative activity by using a high quality Japanese firm-level panel dataset over the period 1994–2005. The novel feature of the analysis is the relation of firm-level variations of patent usage to import competition. The results suggest that intensified import competition from the People’s Republic of China has resulted in greater innovative activity by Japanese firms, consistent with the findings of European firms in Bloom et al. (2016). Moreover, such competition has also led to an increase in non-used patents.
    Keywords: defensive innovation; import competition; innovative activity
    JEL: F10 O00
    Date: 2019–03–28
  33. By: Taghizadeh-Hesary, Farhad (Asian Development Bank Institute); Yoshino, Naoyuki (Asian Development Bank Institute); Chiu, Alvin (Asian Development Bank Institute)
    Abstract: Hong Kong, China’s housing market witnessed dramatic appreciations recently, with the price index for private domestic housing units being 3 times higher than 10 years ago. This trend is supported by both internal and external factors. By providing a theoretical model and empirical analysis on the key variables influencing housing prices, we find that changes in housing price index reinforce price trends in the long term. Hong Kong, China’s dollar quantitative easing, and the gross domestic product of the People’s Republic of China (PRC) are positively related to housing prices and negatively to lending. The inability to increase supplies in response to rising demand since 2003 has also much to do with the skyrocketing prices. Moreover, mortgage-to-total loans value is shrinking due to the unaffordability of housing units at current prices. This trend has to be tackled in time, otherwise the PRC may incur severe consequences similar to Japan’s experience in the 1990s.
    Keywords: housing bubble; housing prices; housing market; quantitative easing (QE); monetary policy
    JEL: E31 E51 R31
    Date: 2019–05–09
  34. By: Hu, Maggie Rong (Asian Development Bank Institute); Li, Xiaoyang (Asian Development Bank Institute); Shi, Yang (Asian Development Bank Institute)
    Abstract: Certificates are widely used as a signaling mechanism to mitigate adverse selection when information is asymmetric. To reduce information asymmetry between lenders and borrowers, Chinese peer-to-peer (P2P) lending platforms encourage borrowers to obtain various kinds of credit certificates. As P2P markets continue to develop, it is plausible that certification may play a pivotal role in ensuring investment efficiency. We perform the first empirical investigation of this issue, using unique data from Renrendai, one of the People’s Republic of China’s largest P2P lending platforms. We find that surprisingly, loans with more credit certificates experience a higher rate of delinquency and default. However, lenders remain attracted by higher certificates despite lower loan performance ex post, which results in distorted capital allocation and reduced investment inefficiency. Overall, we document a setting where credit certificates fail to serve as an accurate signal due to their costless nature, where poor-quality borrowers use more certificates to boost their credit profiles and improve their funding success. Possible explanations for this phenomenon include differences in marginal benefit of certificates for different borrower types, bounded rationality, cognitive simplification, and borrower myopia.
    Keywords: P2P lending; credit allocation; adverse selection; certificate; bounded rationality; cognitive simplification
    JEL: G10 G20 G21 G23
    Date: 2019–04–11
  35. By: Afees A. Salisu (Department for Management of Science and Technology Development, Ton Duc Thang University, Ho Chi Minh City, Vietnam and Faculty of Business Administration, Ton Duc Thang University, Ho Chi Minh City, Vietnam); Rangan Gupta (Department of Economics, University of Pretoria, Pretoria, 0002, South Africa); Ahamuefula E. Ogbonna (Centre for Econometric & Allied Research, University of Ibadan and Department of Statistics, University of Ibadan)
    Abstract: This study forecasts the monthly realized volatility of the US stock market covering the period of February, 1885 to September, 2019 using a recently developed novel approach – a moving average heterogeneous autoregressive (MAT-HAR) model, which treats threshold as a moving average generated time varying parameter rather than as a fixed or unknown parameter. The significance of asymmetric information in realized volatility of stock market forecasting is also considered by examining the case of good and bad realized volatility. The Clark and West (2007) forecast evaluation approach is employed to evaluate the forecast performance of the proposed predictive model vis-à-vis the conventional HAR and threshold HAR (T-HAR) models. We find evidence in favour of the MAT-HAR model relative to the HAR and T-HAR models. Also observed is the significant role of asymmetry in modeling the realized volatility as good realized volatility and bad realized volatility yield dissimilar predictability results. Our results are not sensitive to the choice of sample periods and realized volatility measures.
    Keywords: Realized volatility, US stock market, Forecast evaluation, HAR models
    JEL: C22 C53 G12
    Date: 2019–11
  36. By: Jang-Sup Shin (National University of Singapore)
    Abstract: This paper explains how hedge-fund activists are exerting power over corporate resource allocation far in excess of the actual voting power of their shareholdings. The power of these `minority-shareholding corporate raiders` derives from misguided regulatory `reforms` carried out in the 1980s and 1990s in the name of `shareholder democracy`. Sanctioned and overseen by the Department of Labor (DOL) and the Securities and Exchange Commission (SEC), these reforms include the introduction of compulsory voting by institutional investors and proxy-voting rule changes that greatly facilitated hedge-fund activists` aggregation of the proxy votes of institutional investors. In addition, the introduction of the 1996 National Securities Markets Improvement Act (NSMIA) that allowed hedge funds to draw funds from institutional investors effectively with no limit also played an important role in the rise of hedge-fund activism. The paper concludes with policy proposals to rebalance value creation and value extraction by rebuilding the engagement and proxy voting system including (1) making it mandatory for shareholders to submit justifications in shareholder proposals on value creation or capital formation of corporations concerned; (2) removing voting as a fiduciary duty of institutional investors; (3) introducing differentiated voting rights that favor long-term shareholders; and (4) making it mandatory for both shareholders and management to reveal to the public what they discussed in engagement sessions.
    Keywords: Labor Shareholder democracy, Hedge-fund activism, Compulsory voting of institutional investors, Engagement and proxy rules, Proxy advisory firms, New Deal financial regulations, Sustainable value creation and value extraction.
    JEL: G18 G28 K22 L21 M10 N22
    Date: 2018–07

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