nep-sea New Economics Papers
on South East Asia
Issue of 2022‒01‒31
sixteen papers chosen by
Kavita Iyengar
Asian Development Bank

  1. Has access to health insurance through the Indonesian social security system improved people’s understanding of health issues? Evidence from a national survey By Indra Kurniawan, Muhammad
  2. Complementarities and Intergenerational Educational Mobility: Theory and Evidence from Indonesia By Ahsan, Nazmul; Emran, M. Shahe; Shilpi, Forhad
  3. Weather Shocks and Economic Activity. Evidence from the Philippines By Pardillo, Marvin
  4. Information, Intermediaries, and International Migration By Bazzi, Samuel; Cameron, Lisa A.; Schaner, Simone G.; Witoelar, Firman
  5. Managing Dual Practice of Health Workers: Evidence from Indonesia By Gonzalez, Paula; Montes-Rojas, Gabriel V.; Pal, Sarmistha
  6. A hybrid approach to targeting social assistance By Lendie Follett; Heath Henderson
  7. Examining Pathogen-Based Import Refusals: Trends and Analysis From 2002 to 2019 By Ahn, Jae-Wan; Rhodes, M. Taylor
  8. The Impact of Artificial Intelligence on Labor Markets in Developing Countries: A New Method with an Illustration for Lao PDR and Vietnam By Carbonero, Francesco; Davies, Jeremy; Ernst, Ekkehard; Fossen, Frank M.; Samaan, Daniel; Sorgner, Alina
  9. Large Fiscal Episodes and Sustainable Development: Some International Evidence By Aizenman , Joshua; Jinjarak, Yothin; Nguyen, Hien; Park, Donghyun
  10. COVID-19: Standard Operating Procedure Improvement For Green Office Building Using Indoor Environmental Quality By Nur Hannani Bi Rahman; Shazmin Shareena A. Azis; Ibrahim Sipan
  11. Derivatives-based portfolio decisions. An expected utility insight By Marcos Escobar-Anel; Matt Davison; Yichen Zhu
  12. Using Large-Scale Social Media Data for Population-Level Mental Health Monitoring and Public Sentiment Assessment: A Case Study of Thailand By Suppawong Tuarob; Thanapon Noraset; Tanisa Tawichsri
  13. Intrahousehold Responses to Imbalanced Human Capital Subsidies: Evidence from the Philippine Conditional Cash Transfer Program By Raitzer, David; Batmunkh, Odbayar; Yarcia, Damaris
  14. Does informal employment improve livelihood in the long-term in Azerbaijan? By Nahmadova, Firuza
  15. Trade-Offs? The Impact of WTO Accession on Intimate Partner Violence in Cambodia By Erten, Bilge; Keskin, Pinar
  16. Pursuing the aim of Exchange Traded Funds at the time of Covid-19 By Czereszenko, Witalij

  1. By: Indra Kurniawan, Muhammad (Monash University)
    Abstract: This essay studies the national health insurance system’s impacts on health awareness in Indonesia. I estimate the effects of the insurance enrolment on health knowledge and health behaviour changes after the launch of compulsory social health insurance. Individuals who are less aware of their health may contribute to moral hazard in health insurance. I apply the difference-in-differences method to compare treatment and control groups and the before-after period of the intervention in 2014. Data from the Indonesia Demographic and Health Survey is utilised in this study. Results indicate that social health insurance is negatively correlated with the propensity of knowing certain diseases and contraceptive methods. The scheme adversely affects individuals’ smoking behaviour. Therefore, improving promotive and preventive programs throughout the insurance’s benefits is essential.
    Keywords: National Health Insurance Scheme (NHIS) ; Health behaviour ; Insured and uninsured ; Indonesia JEL Classification: H51 ; I12 ; I13 ; I18
    Date: 2021
  2. By: Ahsan, Nazmul; Emran, M. Shahe; Shilpi, Forhad
    Abstract: We provide a theory based empirical analysis of the role of two types of complementarities in intergenerational educational mobility. We develop a model where parental financial investment in children’s schooling can be complementary to or a substitute of school quality and parent’s education level. Such complementarities can make the mobility equation convex with starkly different mobility patterns compared to the workhorse linear model. Mobility and investment equations derived from the model are estimated for Indonesia, using exceptional data that allow us to tackle two major sources of bias: coresidency and cognitive ability heterogeneity. We find that the mobility equation is convex in rural but linear in urban areas. The children of low educated fathers enjoy higher relative mobility in rural areas, while the urban children fare better in highly educated households. The standard linear model in rural areas incorrectly suggests no rural-urban gap in relative mobility. Theoretical insights help interpret the evidence, suggesting complementarity between financial investment and parental education in both rural and urban areas even though the mobility curve is linear in urban areas. We develop an approach to recover the parameters determining the interaction between school quality and parental investment. School quality is complementary to financial investment in rural areas, with stronger effect in more educated households. In urban areas, school quality is a substitute in low educated households, but complementary in the highly educated households. These results imply that public investment in school quality would lower relative mobility in Indonesia
    Keywords: Intergenerational Educational Mobility, Complementarity, Convex Mobility Curve, School Quality, Rural-Urban Divide, Returns to Education, Coresidency, Sample Truncation, Ability Heterogeneity, Developing Countries, Indonesia
    JEL: J62 O12
    Date: 2021–12–16
  3. By: Pardillo, Marvin (Monash University)
    Abstract: As global temperatures continue to rise, strategies to mitigate the adverse effects of weather shock events become crucial. While previous studies have analysed the effect of climatic variation on economic activity at the national level, there is a lack of understanding of the developmental effects of weather shocks at the subnational level. This study uses monthly night light data captured by Visible Infrared Imaging Radiometer Suite (VIIRS) and weather data to examine the effect of weather shock events at the municipal level in the Philippines. We find that excesses and shortages in monthly rainfall are associated with a decrease in the level of economic activity. We also find that lower temperatures are associated with an increase in the level of economic activity whereas higher temperatures are associated with a decrease in economic activity.
    Keywords: Philippines ; rainfall shocks ; temperature Shocks and night lights JEL Classification: Q54 ; Q58 ; R12
    Date: 2021
  4. By: Bazzi, Samuel (University of California, San Diego); Cameron, Lisa A. (University of Melbourne); Schaner, Simone G. (University of Southern California); Witoelar, Firman (Australian National University)
    Abstract: Job seekers often face substantial information frictions related to potential job quality. This is especially true in international labor markets, where intermediaries match prospective migrants with employers abroad. We conducted a randomized trial in Indonesia to explore how information about intermediary quality shapes migration choices and outcomes. Information reduces the migration rate, lowering use of low-quality intermediaries. However, workers who migrate receive better pre-departure preparation and have higher-quality job experiences abroad, despite no change in occupation or destination. Information does not change intentions to migrate or beliefs about the return to migration or intermediary quality. Nor does selection explain the improved outcomes for workers who choose to migrate with the information. Together, our findings are consistent with an increase in the option value of search: with better ability to differentiate offer quality, workers become choosier and ultimately have better migration experiences. This offers a new perspective on the importance of information and matching frictions in global labor markets.
    Keywords: international migration, information, middlemen, quality disclosure, search
    JEL: F22 O15 D83 L15
    Date: 2021–12
  5. By: Gonzalez, Paula (Universidad Pablo de Olavide); Montes-Rojas, Gabriel V. (University of Buenos Aires); Pal, Sarmistha (University of Surrey)
    Abstract: Managing dual practice of health workers has often proved to be challenging, especially in emerging countries characterized by weak monitoring and low motivation. This paper exploits an exogenous variation in the initiation of private practice among heads of local public facilities (known as puskesmas) providing primary health care after the introduction of a 1997 health regulation in Indonesia. This regulation required health professionals to apply for a license for private practice at least three years after their graduation. Exploiting the exogenous variation in private practice after the 1997 regulation, we provide estimates of causal effects of dual practice on provision of public health services, distinguishing between the effects when private practice is located at or away from the public hospital. The estimates suggest that dual practitioners (relative to those engaged in public service only) work significantly less hours per week while they see significantly more patients in their public facilities. These adverse effects of dual practice are most pronounced when private practice is held away from the puskesmas. These results have important bearings on human resource management of universal health care provision.
    Keywords: dual practice of health professionals, Indonesia, Ministry of Health regulation 916, weak monitoring, difference-in-differences
    JEL: I10 I18 J2 J44 J45 O1
    Date: 2021–11
  6. By: Lendie Follett; Heath Henderson
    Abstract: Proxy means testing (PMT) and community-based targeting (CBT) are two of the leading methods for targeting social assistance in developing countries. In this paper, we present a hybrid targeting method that incorporates CBT's emphasis on local information and preferences with PMT's reliance on verifiable indicators. Specifically, we outline a Bayesian framework for targeting that resembles PMT in that beneficiary selection is based on a weighted sum of sociodemographic characteristics. We nevertheless propose calibrating the weights to preference rankings from community targeting exercises, implying that the weights used by our method reflect how potential beneficiaries themselves substitute sociodemographic features when making targeting decisions. We discuss several practical extensions to the model, including a generalization to multiple rankings per community, an adjustment for elite capture, a method for incorporating auxiliary information on potential beneficiaries, and a dynamic updating procedure. We further provide an empirical illustration using data from Burkina Faso and Indonesia.
    Date: 2022–01
  7. By: Ahn, Jae-Wan; Rhodes, M. Taylor
    Abstract: Identifying adulterants in imported foods and refusing contaminated shipments help minimize the risk of foodborne illness from foreign products and are essential to keep U.S. consumers safe. This report uses import refusal data from the Food and Drug Administration (FDA) from 2002 to 2019 to explore import refusals based on contamination with pathogens and toxins. The report examines trends in total, annually, by industry, and by country. The analysis helps identify which pathogen/toxin is the most common in refused imports, which industries are the most frequently refused in total and by pathogen/toxin type, which countries are the most frequently refused in total and by pathogen/toxin type, and what changes occurred over time. From 2002 to 2019, Salmonella violations accounted for nearly 79.8 percent of all pathogen/toxin violations, followed by Listeria at 11 percent. By food industry group, most pathogen/toxin violations occurred in fishery and seafood products (44.1 percent), followed by spices, flavors, and salts (26.3 percent). Shipments from India, Mexico, and Vietnam accounted for 22.9 percent, 14.9 percent, and 8.6 percent of import refusals due to pathogen/toxin violations, respectively. This report has a limited understanding of which factors affect the refusals because the dataset does not have the volume of shipments inspected, and the FDA inspected only a small percent of the shipment, not randomly, based on the previous history.
    Keywords: Agricultural and Food Policy, Financial Economics, Food Consumption/Nutrition/Food Safety, Health Economics and Policy, Public Economics, Research Methods/ Statistical Methods
    Date: 2021–12–16
  8. By: Carbonero, Francesco (University of Turin); Davies, Jeremy (East Village Software Consultants); Ernst, Ekkehard (ILO International Labour Organization); Fossen, Frank M. (University of Nevada, Reno); Samaan, Daniel (ILO International Labour Organization); Sorgner, Alina (John Cabot University)
    Abstract: AI is transforming labor markets around the world. Existing research has focused on advanced economies but has neglected developing economies. Different impacts of AI on labor markets in different countries arise not only from heterogeneous occupational structures, but also from the fact that occupations vary across countries in their composition of tasks. We propose a new methodology to translate existing measures of AI impacts that were developed for the US to countries at various levels of economic development. Our method assesses semantic similarities between textual descriptions of work activities in the US and workers' skills elicited in surveys for other countries. We implement the approach using the measure of suitability of work activities for machine learning provided by Brynjolfsson et al. (2018) for the US and the World Bank's STEP survey for Lao PDR and Viet Nam. Our approach allows characterizing the extent to which workers and occupations in a given country are subject to destructive digitalization, which puts workers at risk of being displaced, in contrast to transformative digitalization, which tends to benefit workers. We find that workers in Lao PDR are less likely than in Viet Nam to be in the "machine terrain", where workers will have to adapt to occupational transformations due to AI and are at risk of being partially displaced. Our method based on semantic textual similarities using SBERT is advantageous compared to approaches transferring AI impact scores across countries using crosswalks of occupational codes.
    Keywords: artificial intelligence, machine learning, digitalization, labor, skills, developing countries
    JEL: J22 J23 O14 O33
    Date: 2021–12
  9. By: Aizenman , Joshua (University of Southern California); Jinjarak, Yothin (Asian Development Bank); Nguyen, Hien (New Zealand Treasury); Park, Donghyun (Asian Development Bank)
    Abstract: This paper examines the association between episodes of large fiscal impulses (expansions and adjustments) and sustainable development indicators (prosperity, resilience, and inclusivity). We provide country studies of Chile, Poland, South Africa, and Thailand, examining the components of government expenses and tax revenues, and reporting four stylized patterns from the analysis as follows: (i) Fiscal expansions led to higher growth rates and reduced negative trade-offs, e.g., pollution and poor-health mortalities associated with economic growth. (ii) Fiscal adjustments led to a more inclusive economy, lowered poverty headcounts, improved sanitation, and increased cleaner technology access. (iii) Fiscal expansions followed an increase in direct taxes (especially corporate taxes) and a decline in social contributions, and preceded a decline in other direct taxes and an increase in wage bills. (iv) Fiscal adjustments followed a decline in other direct taxes and social contributions, an increase in wage bills, and preceded a decline in government consumption expenditure and transfers. In light of these findings, domestic resource mobilization should consider the time paths of the taxes and expenditure components to understand their empirical linkages with sustainable development outcomes in the respective countries.
    Keywords: sustainable development; tax base; government expenses; large fiscal changes
    JEL: E62 H11 O11
    Date: 2021–12–31
  10. By: Nur Hannani Bi Rahman; Shazmin Shareena A. Azis; Ibrahim Sipan
    Abstract: World health Organization (WHO) acknowledge that the coronavirus airborne transmission could be potentially indoors with crowded and poorly ventilated rooms. Thus, COVID-19 guideline is expected to be part of the 'new norms' in workplace. However, regarding the COVID-19 Standard Operating Procedure (SOP) issued by Ministry of Health Malaysia, there is lack of concentration on Indoor Environmental Quality (IEQ) attributes even it has been proven in many research that the transmission of COVID-19 actively occurs indoor environment and IEQ could mitigate the virus transmission. Therefore, this study aims to discover sustainable COVID-19 framework for office building which not only resilient to COVID-19 threat, but also resilient towards sustainability. There are three objectives outlined in this study: 1) To identify IEQ attributes for office building, 2) To analyse the important IEQ attributes that relate to the existing COVID-19 management guideline for office building, and 3) To develop a sustainable COVID-19 framework for office building. A total of 93 questionnaires is distributed among employees at Menara Majlis Bandaraya Johor Bahru, Malaysia and analysed using Mean Analysis and Cross Tabulation to achieve the research objectives. Overall, result shows that EQ7 Air Change Effectiveness is the most important IEQ attributes that can be selected to improve COVID-19 SOP, while wearing face mask/face shield, frequent hand washing/hand sanitizer, practice personal hygiene and respiratory etiquette, avoid handshaking, practice social/physical distancing, avoid public spaces, gatherings and crowds, avoid contact with people who could be high-risk, avoid meeting in largescale size, relieve/stay home if feel unwell, avoid travelling who are in high-risk, and self-isolate who recently visited latest COVID-19 hotspots are the most important COVID-19 SOP for workplace. This study is significant for building manager or COVID-19 management in workplace to enhance their current SOP by integrating with IEQ to reduce COVID-19 spread in workplace.
    Keywords: COVID-19; Green Office Building; Indoor Environmental Quality; Standard Operating Procedure
    JEL: R3
    Date: 2021–01–01
  11. By: Marcos Escobar-Anel; Matt Davison; Yichen Zhu
    Abstract: This paper challenges the use of stocks in portfolio construction, instead we demonstrate that Asian derivatives, straddles, or baskets could be more convenient substitutes. Our results are obtained under the assumptions of the Black--Scholes--Merton setting, uncovering a hidden benefit of derivatives that complements their well-known gains for hedging, risk management, and to increase utility in market incompleteness. The new insights are also transferable to more advanced stochastic settings. The analysis relies on the infinite number of optimal choices of derivatives for a maximized expected utility (EUT) agent; we propose risk exposure minimization as an additional optimization criterion inspired by regulations. Working with two assets, for simplicity, we demonstrate that only two derivatives are needed to maximize utility while minimizing risky exposure. In a comparison among one-asset options, e.g. American, European, Asian, Calls and Puts, we demonstrate that the deepest out-of-the-money Asian products available are the best choices to minimize exposure. We also explore optimal selections among straddles, which are better practical choices than out-of-the-money Calls and Puts due to liquidity and rebalancing needs. The optimality of multi-asset derivatives is also considered, establishing that a basket option could be a better choice than one-asset Asian call/put in many realistic situations.
    Date: 2022–01
  12. By: Suppawong Tuarob; Thanapon Noraset; Tanisa Tawichsri
    Abstract: Mental health problems are among major public health concerns during the COVID-19 pandemic, given heightened uncertainties and drastic changes in lifestyles. However, mental health problem prevention and monitoring could be greatly improved given advancements in deep-learning techniques and readily available social media messages. This research uses deep learning algorithms to extract emotion, mood, and psychological cues from social media messages and then aggregates these signals to track population-level mental health. To verify the accuracy of our proposed approaches, we compared our findings to the actual number of patients treated for depression, attempted suicides, and self-harm cases reported by Thailand’s Department of Mental Health. We discovered a strong correlation between the predicted mental signals and actual depression, suicide, and self-harm (injured) cases. Finally, we also create a database and user-friendly interface to facilitate researchers and policymakers to explore our extracted mental signals for further applications such as policy sentiment assessment.
    Keywords: Mental Health; Natural Language Processing; Deep Learning; Social Networks
    JEL: I10
    Date: 2022–01
  13. By: Raitzer, David (Asian Development Bank); Batmunkh, Odbayar (Asian Development Bank); Yarcia, Damaris (Asian Development Bank)
    Abstract: Extensive global evidence suggests that conditional cash transfers (CCTs) encourage long-term investment in human capital by poor households. However, CCTs also have the potential to distort incentives for investment among children. If only some children in the household are monitored/subsidized for compliance with conditionalities, returns to household investment in those children increase relative to siblings who are unmonitored/unsubsidized. This paper demonstrates that puzzling nutrition effects of the Philippine CCT are driven by effects on children unmonitored for educational compliance, due to a cap of monitoring at most three children per household. Regression discontinuity design interacted with a secondary instrument for monitoring finds that while monitored children have improved human capital investment, such investment declines for unmonitored children relative to nonbeneficiaries. Patterns are consistent for parental expectations, health, anthropometric, and educational outcomes, and are stronger for boys, in accordance with theoretical expectations. Equalized incentives among children can enhance intended CCT effects.
    Keywords: social protection; conditional cash transfer; human capital; intrahousehold allocation
    JEL: D13 D91 I24 I38
    Date: 2021–12–31
  14. By: Nahmadova, Firuza
    Abstract: Much of the research on income inequality, and livelihood rely on government labor and wages statistics. In emerging economies, the lack of reliable data and the prevalence of informal employment is often mentioned as the main limitation to the credibility of these studies’ results. Azerbaijan is one such case where it is quasi-impossible to estimate an actual average income as informal employment is over half of the entire economy due to, among others, undeclared revenue, low-level bribery, and low formal income. This paper investigates whether informal employment and the undeclared (informal) income that citizens perceive from the related activities improve their livelihoods in the long-term. The relationship between income inequality and informal employment will be discussed based on a comparative analysis of three developing countries from three different regions, namely Africa, Central America, and South-East Asia. Evidence from these developing economies suggests that informal income does not positively impact their livelihoods. The paper ends with a discussion of the impact of informal employment in Azerbaijan using household income per capita statistics for 2020. The discussion suggests that the prevalence of informal employment does not improve the livelihood of the average household.
    Keywords: informal employment, Azerbaijan, poverty, income inequality, wages
    JEL: E2 E26
    Date: 2021–11
  15. By: Erten, Bilge (Northeastern University); Keskin, Pinar (Wellesley College)
    Abstract: We study the impact of trade-induced changes in labor market conditions on violence within the household. We exploit the local labor demand shocks generated by Cambodia’s WTO accession to assess how changes in the employment of women relative to men affected the risk of intimate partner violence. We document that men indistricts facing larger tariff reductions experienced a significant decline in paid employment, whereas women in harder-hit districts increased their entry into the laborforce. These changes in employment patterns triggered backlash effects by increasing intimate partner violence, without changes in marriage, fertility, psychological distress, or household consumption.
    Keywords: trade, intimate partner violence, employment, marriage, fertility, consumption, Cambodia
    JEL: F16 O15 J12 J16
    Date: 2021–12
  16. By: Czereszenko, Witalij
    Abstract: In this paper an endeavour was made to evaluate the impact of Covid-19 on the achievement of the investment objectives by selected ETFs in developed and emerging markets. For this purpose, the tracking errors calculated for 18 different ETFs operating on the basis of American, Asian and European stock indexes were analyzed. The time range of the research was selected in such a way as to compare the period before the pandemic(pre-Covid) and the period after the pandemic (post-Covid). The research results show that the outbreak of the coronavirus pandemic has not had a negative impact on the degree of implementation of the investment objective, regardless of the degree of market development. For each of the analyzed markets, the calculated tracking errors were not higher in the post-Covid period as compared to the pre-Covid period. In the vast majority of cases, they were even lower. This means that the management of the ETF has run smoothly in the most turbulent period of the 21st century.
    Keywords: ETF; Covid-19; financial market; stock indexes
    JEL: G15
    Date: 2021–12–30

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