nep-sea New Economics Papers
on South East Asia
Issue of 2022‒08‒29
24 papers chosen by
Kavita Iyengar
Asian Development Bank

  1. Oil Palm Smallholders Preferences towards Certification Schemes -A Discrete Choice Experiment in Indonesia By Reich, Charlotte-Elena; Musshoff, Oliver
  2. Civil societies' reactions of East- and Southeast Asian countries to the Russian war on Ukraine: Preliminary observations By Malitz, David M. (Ed.); Sriyai, Surachanee (Ed.)
  3. Social dialogue in the public services in selected ASEAN countries a comparative overview of the laws, institutions and practices in Indonesia, Malaysia, the Philippines, Singapore and Thailand By Bitonio, Benedicto Ernesto R.,
  4. Confined to Stay: Natural Disasters and Indonesia's Migration Ban By Andrea Cinque; Lennart Reiners
  5. Applying the routine activity approach to crime victimization in rural Southeast Asia By Ulrike Grote; Thanh-Tung Nguyen; Trung Thanh Nguyen; Frank Neubacher
  6. ITF Southeast Asia Transport Outlook By ITF
  7. The Russian Financial Market in 2021 By Abramov Alexander; Radygin Alexandr; Chernova Maria
  8. Long-term behavioral responses to man-made disasters: Insights from the Agent Orange experiment in Vietnam By Ralitza Dimova; Ulrike Grote; Arnab Basu
  9. Female migrants and online market participation in rural Southeast Asia By Trung Thanh Nguyen; Manh Hung Do
  10. Weak Identification of Long Memory with Implications for Inference By Jia Li; Peter C. B. Phillips; Shuping Shi; Jun Yu
  11. Effects of internal migration on labour market behaviour of families left-behind in Vietnam By David Granada Donato
  12. Vietnam: 2022 Article IV Consultation-Press Release; Staff Report, and Statement by the Executive Director for Vietnam By International Monetary Fund
  13. Asymptotics of Polynomial Time Trend Estimation and Hypothesis Testing under Rank Deficiency By Peter C. B. Phillips
  14. Implementing the ASEAN Fuel Economy Roadmap By ITF
  15. An Econometrician amongst Statisticians: T. W. Anderson By Peter C. B. Phillips
  16. Home-made blues: Residential crowding and mental health in Beijing, China By Xize Wang; Tao Liu
  17. The Impact of Upzoning on Housing Construction in Auckland By Ryan Greenaway-McGrevy; Peter C. B. Phillips
  18. The Finance–Growth Nexus inAsia : A Meta-Analytic Approach By Anwar, Amar; Iwasaki, Ichiro
  19. Schooling and Labor Market Consequences of School Construction in Indonesia: Comment By David Roodman
  20. ITF South and Southwest Asia Transport Outlook By ITF
  21. The Political Relation and Trade - The Case of US, China and Australia. By Yifei Cai; Jamel Saadaoui; Yanrui Wu
  22. Assessing the First Shocks of Covid-19 Pandemic on the Idiosyncratic Risk in the Brazilian and the Emerging Markets By Assis de Salles, Andre
  23. Oil Palm Smallholder Farmers' Livelihood Resilience and Decision Making in Replanting By Hendrawan, Dienda C P; Musshoff, Oliver
  24. System Dynamics Modelling and Climate Change Adaptation in Coastal Areas: A Literature Review By Martínez-Hernández, Alberto Gabino

  1. By: Reich, Charlotte-Elena; Musshoff, Oliver
    Keywords: Agricultural and Food Policy, Institutional and Behavioral Economics, Agricultural Finance
    Date: 2022–08
  2. By: Malitz, David M. (Ed.); Sriyai, Surachanee (Ed.)
    Abstract: Undoubtedly, the war in Ukraine has far-reaching political and economic implications for many regions of the world, including East and Southeast Asia. The governments' reactions to the war have varied considerably ranging from fully supporting Ukraine in alliance with the United States and the European Union, as Japan and Korea have done, to the full backing of Russia by North Korea and Myanmar. That said, many governments in Southeast Asia remain neutral. Nonetheless, the responses to the war in the public spheres neither necessarily agree with their respective governments' stances, nor are they expected to be homogenous. This collection of articles serves as a preliminary attempt to take stock of the reactions of selected civil societies in East and Southeast Asian countries to Russia's invasion of Ukraine in February 2022 by analyzing the respective countries' public sentiment through press and social media. While the reactions of the publics of East and Southeast Asian societies have no direct influence on global society, they will shape their governments' future courses, where they can be expressed and where elections are held. As the long-term consequences of the geopolitical and economic shifts initiated by this conflict will only slowly become fully discernible, their analysis is of great interest. The papers have been presented and discussed at an online workshop jointly organized by the Institute of East Asian Studies at the University of Duisburg-Essen (IN-EAST), the German Institute of Japanese Studies, Tokyo (DIJ), the Chair of Transregional Southeast Asian Studies at Humboldt University Berlin, and the Faculty of Political Science, Chulalongkorn University, Bangkok.
    Keywords: Ukraine,East Asia,ASEAN,Southeast Asia,civil society,public opinions
    Date: 2022
  3. By: Bitonio, Benedicto Ernesto R.,
    Abstract: The study assesses the social dialogue, freedom of association and collective bargaining institutions and practices in the public service among five member-countries of the Association of Southeast Asian Nations (ASEAN), namely Indonesia, Malaysia, the Philippines, Singapore, and Thailand. Generally, “public service” and “public sector” as understood from the Constitutions of the five countries broadly subsume the various branches or agencies of the State performing governmental functions at central and local levels, including State enterprises. The Constitutions of the five countries generally recognize the freedom of association as a fundamental civil liberty, but national legislations typically regulate or restrict trade union rights in the public sector to maintain or protect public order, national security, general welfare or good morals. Malaysia, the Philippines, Singapore and Thailand have their respective institutions and mechanisms that could allow public sector employees, represented by their unions or associations, to engage in some form of social dialogue with their employers, including collective negotiation or bargaining. In public sector social dialogue mechanisms, high-level elected or appointed public administrators responsible for State functions represent the State as employer party. Their unions or organizations represent employees, who come from the civil service or the bureaucracy. Generally, regulation of public sector labour relations makes public sector social dialogue difficult and, in relation to Indonesia, inexistent. The author concludes that there is little evidence to show the meaningful existence of the enabling conditions for effective social dialogue, particularly the existence of strong, independent workers' and employers' organizations as envisioned in fundamental ILO conventions, and of political commitment to engage in social dialogue by all parties.
    Keywords: social dialogue, public service, public sector
    Date: 2022
  4. By: Andrea Cinque; Lennart Reiners
    Abstract: This paper investigates the effects of international migration restrictions on communities’ capacity to absorb income shocks after natural catastrophes. We adopt the implementation of an emigration ban on female Indonesians as a natural experiment. After an array of violent assaults against female servants in Saudi Arabia, the Indonesian government issued a moratorium in 2011, preventing millions of female workers to migrate there as domestic workers. Exploiting the exogenous timing of the ban and that of natural disasters allows us to estimate the causal effect of the absence of international migration as an adaptive strategy. Relying on a panel of the universe of Indonesian villages, we use a triple difference strategy to compare poverty levels in the aftermath of natural disasters for villages whose main destination is Saudi Arabia against others, before and after the policy shock. We find that in villages with strong ex-ante propensity to migrate to Saudi Arabia, poverty increases by 13% in face of natural disasters after the ban, further aggravating the already severe consequences induced by those events.
    Keywords: migration, natural disasters, Indonesia, migration ban
    JEL: F22 J61 Q54
    Date: 2022
  5. By: Ulrike Grote; Thanh-Tung Nguyen; Trung Thanh Nguyen; Frank Neubacher
    Abstract: We use a panel dataset of around 3.500 rural households from Southeast Asia and investigate evidence on crime victimization. More concretely, we ask (1) to what extent are rural people in Thailand and Vietnam affected by crime? And (2) what factors determine rural crime victimization? We use the routine activity approach as the theoretical framework and apply different logit models to identify determinants of crime victimization. We find that 5.46% of the rural households have been victimized, mainly by theft, over the last 12 months, some of them even more than once. Living in a rural region with higher levels of inequality is positively correlated with the likelihood of theft victimization. Households with higher levels of crop commercialization are associated with a higher victimization risk, while households with more livestock and being more specialized in specific livestock species are associated with a lower risk. Moreover, past victimization and exposure to weather shocks are positively associated with the likelihood of being affected by crime. We conclude that rural crime requires attention although overall incidence is low in rural Thailand and Vietnam. Guardianship should be promoted, especially in times of weather shocks. Finally, reducing inequality helps preventing theft.
    Keywords: Farm crime, Victimization, Routine activity approach, Logit model, Southeast Asia
    JEL: D1 I3 K14 K4 O1 Q1
    Date: 2022–07
  6. By: ITF
    Abstract: This report provides scenarios for future transport demand and CO2 emissions in Southeast Asia up to 2050 to help decision-makers chart pathways to sustainable, resilient transport. The scenarios reflect existing policy initiatives and specific constraints in the region. They also examine the potential impact of policies addressing the challenges and opportunities for transport from Covid-19.
    Date: 2022–05–10
  7. By: Abramov Alexander (RANEPA); Radygin Alexandr (Gaidar Institute for Economic Policy); Chernova Maria (RANEPA)
    Abstract: The market for Russian stocks was characterized by growth nearly throughout the whole year 2021; however, starting from November, it began to display a trend towards its downward adjustment. As shown in Fig. 1, among the 43 national stock indexes denominated in different currencies around the world, a positive annual return in 2021 was demonstrated by the composite indexes of 33 countries. The highest growth was achieved by the Argentina index (33.5%), followed closely by the S&P 500 (26.9%). The growth of Russia’s indexes, the RTS and IMOEX, was almost the same: 15.0% and 15.1%, respectively. However, over the first two months of 2022, the situation changed significantly: in January-February, IMOEX fell by a record 38.4%, and the RTS Index, by 41.3%. Over the same period of 2022, a majority of the 43 national stock indexes moved downward, except only a few of them, which were mainly those of developing countries: Argentina, Brazil, Greece, Malaysia, Norway, Singapore, Turkey, the Philippines, and the RSA. The main reason behind this massive adjustment of national stock indexes was the announcement, in mid-December 2021, of the leaders of the US Federal Reserve System (FRS) that in March 2022 they planned to curtail the current quantitative easing program, and so there was a high probability that the interest rates set by the Central Bank would begin to climb.
    Keywords: Russian economy, stock market, bond market, corporate bond market, derivatives market, private investors
    JEL: G01 G12 G18 G21 G24 G28 G32 G33
    Date: 2022
  8. By: Ralitza Dimova; Ulrike Grote; Arnab Basu
    Abstract: Do man-made disasters induce permanent behavioral changes? While the temporary link between negative shocks and risk aversion has been analysed, the evolution of risk profiles over time in response to a negative shock remains unexplored. Using panel data from Agent Orange affected areas in Vietnam, we explore (i) whether individuals in a disaster-prone area are more risk tolerant vis-Ã -vis those who are unaffected, (ii) whether risk tolerance declines and the willingness to invest increases, with the decreasing intensity of the harm in the disaster affected area, and (iii) what factors influence individuals’ residency within disaster affected areas. We find that individuals living within an Agent Orange affected area are relatively more risk loving but this risk tolerance decreases with the decreasing intensity of harm over time. Residency within the disaster area is influenced by the level of human capital and ownership of physical capital.
    Keywords: Vietnam, Agent Orange, Risk Profiles, Propensity Score Matching
    JEL: C93 D1 Q51
    Date: 2022–07
  9. By: Trung Thanh Nguyen; Manh Hung Do
    Abstract: This research aimed to examine the factors affecting the participation of female rural-urban migrants in online marketplaces, the welfare gains and their distribution from the participation. Our analysis was based on the data of 373 female rural-urban migrants in Thailand and Vietnam. Online market participation is classified into three activities, financial transaction, trading, and business. We accounted for the endogeneity issue of online market participation in welfare impact assessment by using an instrumental variable approach. Our results show that the participation has a positive effect on the consumption of female migrants only when they participate in the complete bundle of online market activities. In addition, we also find that the poor benefit insignificantly from online marketplaces. This raises a concern of increasing welfare inequality and suggests that the poor should be supported in order not to be left behind.
    Keywords: Impact; Welfare, Poverty, Endogenous, Heterogeneity, Instrumental variable
    JEL: O18 R11 I30
    Date: 2022–08
  10. By: Jia Li (Singapore Management University); Peter C. B. Phillips (Cowles Foundation, Yale University, University of Auckland, Singapore Management University, University of Southampton); Shuping Shi (Macquarie University); Jun Yu (Singapore Management University)
    Abstract: This paper explores weak identification issues arising in commonly used models of economic and financial time series. Two highly popular configurations are shown to be asymptotically observationally equivalent: one with long memory and weak autoregressive dynamics, the other with antipersistent shocks and a near-unit autoregressive root. We develop a data-driven semiparametric and identification-robust approach to inference that reveals such ambiguities and documents the prevalence of weak identification in many realized volatility and trading volume series. The identification-robust empirical evidence generally favors long memory dynamics in volatility and volume, a conclusion that is corroborated using social-media news flow data.
    Keywords: Realized volatility; Weak identification; Disjoint confidence sets, Trading volume, Long memory
    JEL: C12 C13 C58
    Date: 2022–06
  11. By: David Granada Donato
    Abstract: This document explores the implications of a migratory shock (in the form of household member(s) leaving) on the labour market behaviour of individuals left-behind in Vietnam. In addition, various coping mechanisms exhibited by each age group and their implications regarding sectoral labour allocation are further explored. Using panel data of 2,200 households in six waves and a DiD specification, the results suggest an increase in the likelihood of working for the elderly in agriculture that is most likely associated with higher labour invested in livestock activities. The results are robust to different specifications. Moreover, this coping mechanism of increased work is exhibited by those families that do not receive remittances and seems to last (even increase) for up to three periods after the migratory shock occurs. Interestingly, there is also evidence of diminishing returns on working probability when the share of migrants in the household increase.
    Keywords: Migration, Left-Behind, Labour Market, Agriculture
    JEL: J61 O15 P25 R23
    Date: 2022–01
  12. By: International Monetary Fund
    Abstract: Spurred by an impressive vaccination drive, the economy is rebounding from a severe pandemic wave. The government successfully maintained fiscal, external, and financial stability. Nonetheless, the labor market recovery is lagging, with sizeable underemployment, small and medium sized enterprises remain vulnerable, problem loans are rising, real estate and corporate bond market risks are elevated, and the pandemic exacerbated longstanding structural challenges.
    Date: 2022–07–05
  13. By: Peter C. B. Phillips (Cowles Foundation, Yale University, University of Auckland, Singapore Management University, University of Southampton)
    Abstract: Limit theory is developed for least squares regression estimation of a model involving time trend polynomials and a moving average error process with a unit root. Models with these features can arise from data manipulation such as overdifferencing and model features such as the presence of multicointegration. The impact of such features on the asymptotic equivalence of least squares and generalized least squares is considered. Problems of rank deficiency that are induced asymptotically by the presence of time polynomials in the regression are also studied, focusing on the impact that singularities have on hypothesis testing using Wald statistics and matrix normalization. The paper is largely pedagogical but contains new results, notational innovations, and procedures for dealing with rank deficiency that are useful in cases of wider applicability.
    Keywords: Asymptotic deficiency, Asymptotic equivalence, Hypothesis testing, Least squares regression, MA unit root, Trend regression, Wald statistic
    JEL: C23
    Date: 2022–05
  14. By: ITF
    Abstract: This report explores how ASEAN member states can mitigate the negative impacts of the rapidly growing number of cars on the region’s roads. More, increasingly larger vehicles consume more energy, emit more CO2 and cause more local air pollution. Among the policies to counter these trends and make mobility in the region more sustainable is the ASEAN Fuel Economy Roadmap. This study provides support for implementing the roadmap. It looks specifically at policies for making light-duty vehicles more efficient and less emitting but also provides insights for other motorised road vehicles. The report explores opportunities for aligning policies across ASEAN, considers the role of trade agreements and recommends measures for a transition towards electrification.
    Date: 2022–03–28
  15. By: Peter C. B. Phillips (Cowles Foundation, Yale University, University of Auckland, Singapore Management University, University of Southampton)
    Abstract: T. W. Anderson did pathbreaking work in econometrics during his remarkable career as an eminent statistician. His primary contributions to econometrics are reviewed here, including his early research on estimation and inference in simultaneous equations models and reduced rank regression. Some of his later works that connect in important ways to econometrics are also briefly covered, including limit theory in explosive autoregression, asymptotic expansions, and exact distribution theory for econometric estimators. The research is considered in the light of its influence on subsequent and ongoing developments in econometrics, notably confidence interval construction under weak instruments and inference in mildly explosive regressions.
    Keywords: Asymptotic expansions, Confidence interval construction, Explosive autoregression, LIML, Reduced rank regression, Simultaneous equation models, Weak identification regression, MA unit root, Trend regression, Wald statistic
    JEL: C23
    Date: 2022–06
  16. By: Xize Wang (National University of Singapore); Tao Liu (Peking University)
    Abstract: Although residential crowding has many well-being implications, its connection to mental health is yet to be widely examined. Using survey data from 1613 residents in Beijing, China, we find that living in a crowded place - measured by both square metres per person and persons per bedroom - is significantly associated with a higher risk of depression. We test for the mechanisms of such associations and find that the residential crowding-depression link arises through increased living space-specific stress rather than increased life stress. We also identify the following subgroups that have relatively stronger residential crowding-depression associations: females, those living with children, those not living with parents, and those living in non-market housing units. Our findings show that inequality in living space among urban residents not only is an important social justice issue but also has health implications.
    Date: 2022–07
  17. By: Ryan Greenaway-McGrevy (University of Auckland); Peter C. B. Phillips (Cowles Foundation, Yale University, University of Auckland, Singapore Management University, University of Southampton)
    Abstract: There is a growing debate about whether upzoning is an effective policy response to housing shortages and unaffordable housing. This paper provides empirical evidence to further inform debate by examining the various impacts of recently implemented zoning reforms on housing construction in Auckland, the largest metropolitan area in New Zealand. In 2016, the city up zoned approximately three quarters of its inner suburban land to facilitate construction of more intensive housing. We use a quasi-experimental approach to analyze the short-run impacts of the reform on construction, allowing for potential shifts in construction from non-upzoned to upzoned areas (negative spillovers) that would, if unaccounted for, lead to an overestimation of treatment effects. We find strong evidence that upzoning stimulated construction. Treatment effects remain statistically significant even under implausibly large spillovers that would necessi tate a six-fold increase in the trend rate of construction in control areas under the counterfactual of no-upzoning. Our findings support the argument that upzoning can stimulate housing supply and suggest that further work to identify factors that mediate the efficacy of upzoning in achiev ing wider objectives of the policy would assist policymakers in the design of zoning reforms in the future.
    Keywords: Upzoning, Land Use Regulations, Redevelopment, Housing Construction, Housing Affordability
    JEL: R14 R31 R52
    Date: 2022–05
  18. By: Anwar, Amar; Iwasaki, Ichiro
    Abstract: This paper features a meta-analysis of the effects of financial development and liberalization on macroeconomic growth in Asia. A meta-synthesis of 748 estimates extracted from 75 previous works indicates that the growth-enhancing effect of finance reaches an economically meaningful scale in the region. Synthesis results also reveal that the finance–growth nexus in South Asia is stronger than that in East Asia. Publication selection bias is examined using both linear and nonlinear techniques, and our results show that there is a possibility of publication bias in the literature. After applying advanced and up-to-date metaanalysis methods, we find that the collected estimates contain significant underlying empirical evidence of the impact of finance on economic growth for both Asia and its subregions.
    Keywords: financial development, economic growth, meta-analysis, publication selection bias, Asia
    JEL: E44 G10 O11 O16 D53
    Date: 2022–08
  19. By: David Roodman
    Abstract: Duflo (2001) exploits a 1970s primary schooling expansion to estimate the returns to schooling in Indonesia. Under the study's difference-in-differences (DID) design, two patterns in the data--negative selection in treatment and shallower wage-schooling gradients for younger workers--can together bias results upward. In response, I follow-up later; test for trend breaks timed to the intervention; and perform changes-in-changes, which relaxes the parallel trends assumption. I also correct data errors, cluster variance estimates, incorporate endogenous survey weights, and test for (and detect) instrument weakness. Weak identification-robust inference yields weakly positive estimates. CIC yields weakly negative results.
    Date: 2022–07
  20. By: ITF
    Abstract: This report provides scenarios for future transport demand and CO2 emissions in South and Southwest Asia up to 2050 to help decision-makers chart pathways to sustainable, resilient transport. The scenarios reflect existing policy initiatives and specific constraints in the region. They also examine the potential impact of policies addressing the challenges and opportunities for transport from Covid-19.
    Date: 2022–06–08
  21. By: Yifei Cai; Jamel Saadaoui; Yanrui Wu
    Abstract: This paper employs structural vector autoregression and local projection methods to examine the impacts of the deterioration in US-China political relations on Australia-China bilateral trade. By imposing a recursive identification scheme with different assumptions, the empirical results illustrate that worsening US-China political relations have a negative impact on Australian exports to and imports from China. Under a time-varying structural vector autoregression model, it is found that the deterioration in US-China political relations augments the negative impacts on Australia-China bilateral trade during the Trump’s administration. The empirical findings provide insightful policy suggestions to both Australian and Chinese governments.
    Keywords: Structural vector autoregression, Local projection, Impulse response; US-China political relation; Australia-China trade.
    JEL: C32 F14 F51
    Date: 2022
  22. By: Assis de Salles, Andre
    Abstract: The Covid-19 Pandemic affects social and economic relations in all national economies and the world economy, and their financial markets. Investment and production financing in economies takes place through these markets, in particular in the capital market. The idiosyncratic risk represents the risk associated only with a specific productive project, with an economic sector, or with a specific national economy. This work aims to estimate the idiosyncratic risk of the Brazilian economy, through heteroscedastic conditional models, to verify the initial impact of the Covid-19 Pandemic on the risk associated with productive projects developed in the Brazilian and emerging economies, and to their financing and investments. Daily data in US$, covers the period from June 30, 2017 to July 1, 2020, were used.
    Keywords: Covid-19 Pandemic; Idiosyncratic Risk; Brazilian Economy; Emerging Economies.
    JEL: C22 F65 G01 G1 G12 N2
    Date: 2021–03
  23. By: Hendrawan, Dienda C P; Musshoff, Oliver
    Keywords: Institutional and Behavioral Economics, Agricultural and Food Policy, Community/Rural/Urban Development
    Date: 2022–08
  24. By: Martínez-Hernández, Alberto Gabino
    Abstract: Climate change impacts in coastal areas (CA) have exposed coastal ecosystems to unprecedented conditions. System dynamic modelling (SD) has been used as a powerful tool to improve climate change adaptation (CCA) strategies. However, until now there are no review papers that summarize how academic literature that employs SD modelling has addressed CCA in CA. Hence, the main objective of this study is to provide an overview of the state of the art of this field. A systematic literature review was chosen as the main method of analysis, which was complemented with a bibliometric analysis and a categorization of the main contents of the papers selected. Our results suggest that the literature is clustered in three groups: physical or social impacts, water and agriculture management, as well as ecosystem services. Following the classification of key representative risks (KRK) of the IPCC, some topics have been addressed more than others. Most papers focus on Disaster Risk Reduction (DRR) compared to adaptation to slow onset hazards. Besides, research in developing countries remains scarce, except for the case of Vietnam. One group of models seem to be in an advanced stage or abstract enough to be applied in other areas, whereas another group is better suited for local modelling. Quantitative SD modelling has been preferred compared to qualitative or mixed approaches. Finally, Stella and Vensim seem to be the most popular platforms to run simulations.
    Keywords: Public Economics, Research Methods/ Statistical Methods
    Date: 2022–08–05

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