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on South East Asia |
| By: | Pepinsky, Thomas B. |
| Abstract: | This paper examines how political business relations have shaped country vulnerability to financial crises during periods of international financial contagion. While close relations between political and business elites in island Southeast Asia deepened vulnerability during the Asian Financial Crisis, the same does not hold during the global crisis of 2008-09?neither the countries where political business relations have changed (Indonesia) nor the countries where they are the same (Malaysia, the Philippines, and Singapore) have experienced a true economic or financial crisis. Instead, for island Southeast Asia this crisis is merely a trade and investment shock, and a relatively minor one at that. A comparison of the crises of 1997-98 and the non-crises of 2008-09 shows that political business relations only affect external vulnerability insofar as they interact with economic policy settings, regulatory regimes, and the beliefs of investors. |
| Keywords: | financial crisis , vulnerability , political business relation , investor beliefs , Southeast Aisa |
| Date: | 2012–03–30 |
| URL: | http://d.repec.org/n?u=RePEc:jic:wpaper:43&r=sea |
| By: | Doner, Richard |
| Abstract: | This paper explores the capacities for sustained growth in the export-oriented countries of Southeast Asia, with a focus on Vietnam, Malaysia and Thailand. The paper is especially concerned with the prospects for "upgrading" and moving beyond the "middle-income trap" in Malaysia and Thailand. But the core argument for all three countries is similar: Each has responded relatively well to economic crises with impressive reforms, especially in areas of property rights, macroeconomic policies, and, to varying degrees, financial supervision. With some exceptions, however, reforms have not extended to improving local (indigenous) competitiveness and technological capacities. These limits reflect both successful adjustment in areas noted earlier and the availability of resources, including commodity export revenues, external aid, and migrant / informal labor. The danger is that such "safety valves" will serve to reinforce existing institutional and political arrangements, thus undermining initiatives to improve local competitiveness and linkages so key to upgrading. Of particular interest is the fact that, unlike Western European countries where external exposure and vulnerability have led to various forms of labor incorporation, and unlike in the East Asian NICs, where such vulnerability has led at least to a commitment to shared prosperity (and in Singapore to a peak union's participation in labor market and productivity decisions), labor has remained largely disorganized and excluded from bargaining over key issues in export-oriented Southeast Asia. This argument in turn reflects the contention that crises vary in nature and intensity, that different crises have different impacts on the willingness and capacity of political elites to promote new coalitions and to foster new forms of coordination (i.e. institutions), and that such institutions are especially important for movement into more innovation-based activities and higher income status. |
| Keywords: | economic upgrading , middle-income trap , crisis , labor , capacity , Southeast Asia |
| Date: | 2012–03–30 |
| URL: | http://d.repec.org/n?u=RePEc:jic:wpaper:45&r=sea |
| By: | Siackhachanh, A. Noy (Asian Development Bank) |
| Abstract: | As witnessed during the 1997/98 Asian financial crisis, the dependency on short-term foreign capital for long-term investment made the region vulnerable to the sudden reversal of capital inflows. Rapid capital outflows not only caused the collapse of the financial system but also a sharp economic contraction that caused millions of citizens to fall below the poverty line and reversed overnight the gains in poverty alleviation that had taken decades for governments in the region to achieve. To mitigate against risks associated with the sudden stop of capital inflows, the Association of Southeast Asian Nations (ASEAN) and the People's Republic of China, Japan, and the Republic of Korea - collectively known as ASEAN+3 - have been working together to develop local currency bond markets in order to mobilize domestic savings to finance long-term investment and strengthen the resilience of the financial system in the region. The first regional initiative designed to achieve this endeavor was the Asian Bond Market Initiative (ABMI), launched by ASEAN+3 in 2002. The second was Asian Bond Fund 1 and 2, launched in 2003 and 2005, respectively by EMEAP economies.* The Asian Development Bank has provided support to ASEAN+3, as the secretariat, to facilitate the implementation of the policy actions promoted under ABMI. <p> This paper reviews the progress made under ABMI over the past 10 years, particularly the progress made in mobilizing domestic savings for investment. The paper then proposes measures for ASEAN+3 economies to more effectively channel domestic savings for investment and stimulate domestic demand to help modify growth patterns and improve savings -investment imbalances. |
| Keywords: | Local currency bond markets in Asia; ASEAN+3; Emerging Asia |
| JEL: | G10 G12 G20 G24 |
| Date: | 2012–04–01 |
| URL: | http://d.repec.org/n?u=RePEc:ris:adbrei:0094&r=sea |
| By: | Nathalie Aminian; K.C. Fung; Alicia Garcia-Herrero; Francis NG |
| Abstract: | This paper investigates the trend and characteristics of trade in services in two fertile regions where different forms of trade integration have taken place: East Asia and Latin America. To that end, the World Bank data are utilized to categorize services trade in order to put on view the national and regional positions on dynamic sectors, and to compare East Asia and Latin America in terms of revealed comparative advantages, the weight of service activities in the regional economic activity, the share of services employment. The paper deals also with the issue of internationalization of services through FDI. Overall, it shows the increasing importance of East Asia as a trading region while the share of North & Latin America is low and declining over time. |
| Keywords: | Service trade, East Asia, Latin America, foreign direct investment |
| JEL: | F14 F15 O53 O54 O57 |
| Date: | 2012–04 |
| URL: | http://d.repec.org/n?u=RePEc:bbv:wpaper:1204&r=sea |
| By: | Fujita, Yasuo |
| Abstract: | This paper discusses policy issues pertaining to infrastructure development in low income countries (LICs) in Asia. Infrastructure challenges in Asian LICs have not been adequately highlighted to date mainly because the international focus has often been on African LICs and because large countries such as China, India, and Indonesia attracted more interest among the developing Asian countries. While Asian LICs have sought to improve their infrastructure over the years, the quality and quantity is generally insufficient although significant variations exist between countries and sectors. Since their fiscal space and governmental capacities are limited despite large investment needs, each possible infrastructure investment must be placed in order of priority. In Asian LICs, spatially connective infrastructure (including logistics, telecommunications, and electricity) should be given priority to generate benefits from economies of agglomeration, fragmentation of production activities, and better connectivity to fast-growing large markets, although the trade-off between economic efficiency and spatially balanced growth is a difficult issue. Particularly, some large Asian LICs have great potential to become part of sophisticated regional production networks through effective infrastructure. Climate change, both the adaptation of infrastructure and mitigation through green development, also needs to be sufficiently taken into account or mainstreamed. The fact that the investment in public private partnerships (PPP) projects in infrastructure has recently been increasing in Asian LICs is encouraging. To scale up PPP, Asian LIC governments should clarify the contributions of the private sector (in such aspects as capital investment and operational efficiency), continue to improve the investment climate, policies, and regulations, and prepare bankable projects in which the roles of the public and private sectors are defined. The public sector will continue to be the main provider and regulator of infrastructure in Asian LICs. Although public sector performance should improve, there has been no single blueprint for it, and therefore country-specific approaches are called for. Donors should continue to support Asian LICs in scaling up infrastructure investment through project-financing, technical assistance, and capacity development. Keywords: Infrastructure, low income country, economic integration. |
| Keywords: | Infrastructure, low income country , economic integration , public private partnership , climate change |
| Date: | 2012–03–19 |
| URL: | http://d.repec.org/n?u=RePEc:jic:wpaper:40&r=sea |
| By: | Roy, Amlan (Asian Development Bank Institute) |
| Abstract: | This paper discusses what is longevity risk, why it is important, approaches used by the West to manage longevity risk, and what lessons can be learnt by Asian countries from the experiences of the West. Increasing and uncertain longevity has emerged as a key risk affecting individuals, pension plans, insurers, and governments in both the developed and emerging world. I discuss progress in the field of longevity modeling and the merits as well as drawbacks of these models. In western countries, attempts have been made by capital market and governments to deal with longevity risk, but the availability of solutions remain limited. |
| Keywords: | longevity risk; asia; managing longevity risk; longevity modeling; pension plans |
| JEL: | H55 I38 J14 J32 O17 |
| Date: | 2012–04–13 |
| URL: | http://d.repec.org/n?u=RePEc:ris:adbiwp:0353&r=sea |
| By: | Kaliappa Kalirajan, (Asian Development Bank Institute (ADBI)) |
| Abstract: | It is logical to argue that growth led by low-carbon goods and services (LCGS) is an imperative for the countries of Asia and the Pacific, and particularly for emerging Asian economies, which are heavily dependent on imported energy and resources. Acknowledging this fact, individual governments in Asia have recently been taking effective actions in the form of voluntary targets and policy commitments to improve the production and use of LCGS. However, the observed effects of these commitments are often challenged by many constraints, such as technological barriers, financial deficiencies, and lack of human capital, some of which are very specific to developing Asia. Different sector policies—such as in trade and environment—and investment policies that aim to facilitate private enterprises, households, and government agencies to contribute to green growth through the use of LCGS are being implemented at the national level. However, fears of competitive disadvantage mean that these policies need to be driven by global and regional frameworks that encompass all countries and sectors. In this context, the objectives of this study are to (i) measure the potential of major emerging Asian economies for exports in LCGS under the "grand coalition," partial coalition, and stand-alone scenarios; (ii) measure the impact of existing "behind the border" constraints on potential exports in emerging Asian economies; (iii) identify the potential, options, and challenges with respect to a grand coalition scenario; and (iv) find ways to improve the contribution of public–private partnerships to LCGS. |
| Keywords: | Green Asia, low-carbon goods and services (LCGS), Asia and the Pacific, the production and use of LCGS |
| JEL: | Q56 Q58 R11 |
| Date: | 2012–04 |
| URL: | http://d.repec.org/n?u=RePEc:eab:develo:23291&r=sea |
| By: | Kawaguchi, Daiji (Hitotsubashi University); Lee, Soohyung (University of Maryland) |
| Abstract: | Every year, a large number of women immigrate as brides from developing countries to developed countries in East Asia. This phenomenon virtually did not exist in the early 1990s, but foreign brides currently comprise 4 to 35 percent of newlyweds in these developed Asian countries. This paper argues that two factors account for this rapid increase in "bride importation": the rapid growth of women's educational attainment and a cultural norm that leads to a low net surplus of marriage for educated women. We provide empirical evidence supporting our theoretical model and its implications, using datasets from Japan, Korea, Singapore, and Taiwan. |
| Keywords: | immigration, marriage, sex ratio imbalance, international marriages, cross-border marriages, assortative matching |
| JEL: | A12 J12 J61 |
| Date: | 2012–03 |
| URL: | http://d.repec.org/n?u=RePEc:iza:izadps:dp6458&r=sea |
| By: | Yuki, Takako; Hong, Yeeyoung; Kang, Kyuwon; Kuroda, Kazuo |
| Abstract: | This paper sheds light on the increasingly diverse forms of cross-border higher education in East Asia, ranging from traditional student mobility (e.g., full-time study abroad) to the mobility of the programs themselves. Specifically, this paper examines the expected outcomes and risks or challenges of cross-border collaborative degree programs by focusing on differences in the level of collaboration and by using two survey datasets on leading East Asian universities and their collaborative degree programs. As for the expected outcomes of such programs, this survey of universities indicates that improving the quality of education is perceived as a more important outcome of collaborative degree programs than it is for traditional forms of simple student mobility. However, this survey of programs confirms the variation in the degree of collaboration among collaborative programs in terms of location, curriculum and degree provision; it also shows that bilateral programs, which require greater collaboration between the partner institutions, tend to perceive promoting intercultural awareness, achieving research excellence and promoting regional collaboration and Asian identity as more important than one-side led programs do. Bilateral programs also see economic benefits in collaborative degree programs, such as meeting the demands of the global economy, when the data samples used for the analysis are limited to programs conducted between institutions from high-income and middle-income countries, thus excluding programs with low-income countries. On the other hand, the risks and challenges of cross-border collaborative degree programs tend to be perceived as less significant by bilateral programs than by one-side led programs. These results point to the importance of the greater involvement of each of the partner institutions in meeting the expectations of the other partner and mitigating any risks or challenges in cross-border degree programs. In particular, it is worth considering such increasingly higher levels of collaboration as each country in the partnership develops its economy and higher education institutions. |
| Keywords: | cross-border higher education , double degree , twinning , ASEAN , Asia |
| Date: | 2012–03–13 |
| URL: | http://d.repec.org/n?u=RePEc:jic:wpaper:39&r=sea |
| By: | Andrew Filardo |
| Abstract: | Asian central banks have adopted monetary policy frameworks over the past decade that have, by and large, worked well both to ensure price stability during the pre-crisis period and to navigate the shoals during the recent international financial crisis. Inflation concerns in recent years nonetheless raise the possibility that existing monetary policy frameworks in Asia may be contributing to procyclical inflation swings. Three particular aspects of the policy environment are highlighted. They include the approach of monetary policy to commodity price cycles, to the uneven global recovery and to the new financial stability mandates. |
| Keywords: | Central banking, international financial crisis, monetary policy frameworks in Asia, commodity prices, financial stability and monetary policy |
| Date: | 2012–04 |
| URL: | http://d.repec.org/n?u=RePEc:bis:biswps:378&r=sea |
| By: | Chotichanathawewong, Qwanruedee (Asian Development Bank Institute); Thongplew, Natapol (Asian Development Bank Institute) |
| Abstract: | In Thailand climate change has been integrated into the formulation of several national plans and policies. Both the public and private sector have been actively involved in reducing greenhouse gas emissions, with a series of measures and actions implemented in each sector. The development of renewable energy and the promotion of energy conservation and efficiency have been the primary means to mitigate greenhouse gas emissions in Thailand and though it has made significant progresses toward green and low-carbon development, there is a need to further address the issue. |
| Keywords: | climate change; thailand; greenhouse gas emissions; renewable energy; low-carbon development |
| JEL: | Q54 Q58 |
| Date: | 2012–04–13 |
| URL: | http://d.repec.org/n?u=RePEc:ris:adbiwp:0352&r=sea |
| By: | Chu, Yun-han |
| Abstract: | Taiwan was one of the few Asian economies that had emerged from the 1997-1998 East Asian financial crisis relatively unscathed. During the 2008-2009 global financial crisis, the island’s shock-absorbing capability turned out to be once more quite respectable. Taiwan inherited a relatively healthy state of financial systems prior to the sub-prime loan crisis and built up a huge foreign reserve. Also foreign banks’ participation in domestic loan market was quite limited. The state dominated the banking sector and closely supervised its lending policy and balance sheet. The island’s macro-economic fundamentals were quite healthy and the government still enjoyed spare fiscal capacity to borrow and spend. Many elements that define Taiwan’s economic resilience have been fostered by some entrenched institutional arrangements and established policy orientations over a long time. Taiwan managed to retain the bulk of these long-running sources of economic resilience despite of the tremendous external pressures by neo-liberal policy advocates to dismantle these “out-dated” policy thinking and practices. Furthermore, despite of the political turmoil after the first power rotation of 2000, the legacy of an independent and proactive central bank, whose reputation and credibility had been strengthened by its record of steering the island safely through the financial crisis as well as the Strait missile crisis, was kept intact. The legacy of prudential financial regulation was also largely kept intact with the concentration of regulatory authority in a new cabinet-level supervisory commission. Taiwan was able to cope with the 2008-09 global financial crisis thanks also to a more enabling regional environment. The political backlash against IMF-imposed austerity measures precipitated a growing awakening among East Asian policy thinkers. Most developing countries in the region have insured themselves through managing exchange rates and building huge currency reserves, so that they could be protected against the tempests of currency speculation and never again would have to call on the IMF. The ideological milieu and the cooperative institutional arrangements in East Asia have changed so much between the two crises. |
| Keywords: | Taiwan , Central Bank of China , State-owned Banks , Fiscal Conservatism , QFII System , Financial Supervisory Commission |
| Date: | 2012–03–30 |
| URL: | http://d.repec.org/n?u=RePEc:jic:wpaper:44&r=sea |
| By: | Wahyu Yuwana Hidayat (Bank Indonesia); Makoto Kakinaka (International University of Japan); Hiroaki Miyamoto (International University of Japan) |
| Abstract: | The recent trend of product diversification in the Indonesian banking industry underscores the importance of non-interest income activities. This study examines the relationship between product diversification and bank risk over the period of 2002-2008. Our analysis shows clear evidence that the effect of product diversification on bank risk depends highly on the bankfs asset size. Specifically, the degree of product diversification is negatively associated with bank risk for small-sized banks. Conversely, the degree of product diversification is positively related to bank risk for large-sized banks. This finding suggests that deregulation encouraging banks to become more involved in non-traditional activities may have an adverse effect on the overall banking system where large-sized banks are playing a significant role in Indonesia. |
| Keywords: | Bank risk, Product diversification, Non-interest income activities |
| Date: | 2012–04 |
| URL: | http://d.repec.org/n?u=RePEc:iuj:wpaper:ems_2012_03&r=sea |
| By: | Hamanaka, Shintaro (Asian Development Bank); Domingo, Romana (Asian Development Bank) |
| Abstract: | As tariffs are increasingly being reduced, trade economists and policymakers have begun to emphasize the importance of reducing non-tariff trade costs to facilitate international trade flows. However, the measurement of trade costs and transport costs, in particular, is not an easy task. For developing country policymakers, it is important to accurately understand their country’s trade facilitation status (improvement as well as deterioration) at the commodity level, to be able to design appropriate trade facilitation policies. However, in reality, the majority of policymakers and researchers tend to overuse data from the World Bank’s Doing Business Report, despite the fact that data on costs to export and import under its trading-across-borders component have several inherent weaknesses. In this paper, we suggest that the use of trade statistics calculated in conjunction with Doing Business data is helpful in understanding overall as well as detailed commodity-level trade costs. The two can be regarded as alternative indicators of trade efficiency, because both indicators improve when the trade transaction is streamlined. Moreover, by using trade statistics, we can compute not only long-term trade costs but also trade costs for each commodity group, unlike the case of Doing Business data where the assumption of a standardized 20-foot, 10-ton dry cargo of a country’s leading export or import product is employed. Based on commodity-level trade costs, more concrete trade facilitation policies targeting specific sectors can be developed. |
| Keywords: | transport costs; commodity level; trade statistics; c.i.f.-f.o.b.; trade facilitation |
| JEL: | F13 F14 F15 |
| Date: | 2012–04–01 |
| URL: | http://d.repec.org/n?u=RePEc:ris:adbrei:0095&r=sea |
| By: | Esfahani, Hadi Salehi (University of Illinois at Urbana-Champaign); Mohaddes, Kamiar (University of Cambridge); Pesaran, Hashem (University of Cambridge) |
| Abstract: | This paper develops a long-run growth model for a major oil exporting economy and derives conditions under which oil revenues are likely to have a lasting impact. This approach contrasts with the standard literature on the "Dutch disease" and the "resource curse", which primarily focuses on short-run implications of a temporary resource discovery. Under certain regularity conditions and assuming a Cobb-Douglas production function, it is shown that (log) oil exports enter the long-run output equation with a coefficient equal to the share of capital (α). The long-run theory is tested using quarterly data on nine major oil economies, six of which are current members of OPEC (Iran, Kuwait, Libya, Nigeria, Saudi Arabia, and Venezuela), plus Indonesia which is a former member, and Mexico and Norway, which are members of the OECD. Overall, the test results support the long-run theory. The existence of long-run relations between real output, foreign output and real oil income is established for six of the nine economies considered. The exceptions, Mexico and Norway, do not possess sufficient oil reserves for oil income to have lasting impacts on their economies. At their current production rates, the proven oil reserves of Mexico and Norway are expected to last 9 and 10 years respectively, as compared to reserve-production ratios of OPEC members, which lie in the range of 45 to 125 years. For Indonesia, whose share of oil income in GDP has been declining steadily over the past three decades, the theory suggests that the effect of oil income on the economy's steady state growth rate will vanish eventually, and this is indeed confirmed by the results. Sensible estimates of α are also obtained across the six economies with long-run output equations, and impulse responses are provided for the effects of shocks to oil income and foreign output in these economies. |
| Keywords: | growth models, long run and error correcting relations, major oil exporters, OPEC member countries, oil exports and foreign output shocks |
| JEL: | C32 C53 E17 F43 F47 Q32 |
| Date: | 2012–04 |
| URL: | http://d.repec.org/n?u=RePEc:iza:izadps:dp6468&r=sea |
| By: | Stephen Howes (Asian Development Bank Institute (ADBI)); Paul Wyrwoll |
| Abstract: | The developing economies of Asia are confronted by serious environmental problems that threaten to undermine future growth, food security, and regional stability. This study considers four major environmental challenges that policymakers across developing Asia will need to address towards 2030 : water management, air pollution, deforestation and land degradation, and climate change. We argue that these challenges, each unique in their own way, all exhibit the characteristics of “wicked problemsâ€. As developed in the planning literature, and now applied much more broadly, wicked problems are dynamic, complex, encompass many issues and stakeholders, and evade straightforward, lasting solutions. Detailed case studies are presented to illustrate the complexity and significance of Asia’s environmental challenges, and also their nature as wicked problems. The most important implication of this finding is that there will be no easy or universal solutions to environmental problems across Asia. This is a caution against over-optimism and blueprint or formulaic solutions. It is not, however, a counsel for despair. We suggest seven general principles which may be useful across the board. These are : a focus on co-benefits; an emphasis on stakeholder participation; a commitment to scientific research; an emphasis on long-term planning; pricing reform; tackling corruption, in addition to generally bolstering institutional capacity with regard to environmental regulation; and a strengthening of regional approaches and international support. |
| Keywords: | Environmental Problems, Asia, developing economies of Asia, developing Asia |
| JEL: | O44 Q58 Q56 O10 O53 Q28 Q53 |
| Date: | 2012–02 |
| URL: | http://d.repec.org/n?u=RePEc:eab:develo:23289&r=sea |
| By: | Koda, Yoshiko; Yuki, Takako |
| Abstract: | This paper examines the labor market outcomes of two different forms of cross-border higher education degree programs (i.e., full study abroad vs. twinning) between Malaysia and Japan. Specifically, based on a new graduate survey, it examines whether there are differences in the labor market outcomes between the two programs and what other factors have significant effects on the labor market outcomes. The results of regression analysis indicate that there are no significant differences between the two programs in terms of employment immediately after graduation, being in graduate-level positions in current jobs, and in the levels of earnings in current jobs. Instead, among the variables related to education, the degree fields, internship experiences, and university rankings are significant for the first employment. For current work, the results suggest that the post-graduation qualifications such as junior engineers and English and Japanese language skills become important. Based on our findings, considering the labor market outcomes as a purpose of studying abroad, twinning program between two countries could be one of the tools of human capital development. |
| Keywords: | cross-border higher education , twinning , study abroad , employment probability , graduate-level jobs , earnings , quality of higher education institutions |
| Date: | 2012–03–28 |
| URL: | http://d.repec.org/n?u=RePEc:jic:wpaper:41&r=sea |
| By: | Sato, Jin |
| Abstract: | This paper argues that the continuing failure of environmental governance by the state lies not only in inappropriate actions taken by the responsible agencies, but also in the way bureaucratic structures have evolved to limit their policy choices. Whether effective or not, the state continues to be dominant in determining the use (and non-use) of natural resources in many parts of the world. Based on a detail case study of Thailand, the paper draws two major conclusions: First, inter-departmental conflict has historical roots that have shaped the present policy environment. New mandates and responsibilities are continuously added on top of the policy space. Because the Thai government established vested interests in the field of production in its formative period in order to expand commercial activities and generate revenue, a more recent mandates to conserve resources were left with little room. The late-coming departments are often pushed into performing mandates that limit them to the area of research and planning, often in isolation with the authority to enforce regulations. This asymmetric division of labor induced not only policy inaction among the departments who dared not step into the territories of other departments, but also provided a safe haven for production-oriented departments. Second, bureaucratic competition is often controlled by pre-existing veto players?i.e., those who now belong (and originally belonged) to the production sector and developed strong vested interests in the status quo. The way bureaucratic division of labor occurs gives us hints on why innovative institutions perform poorly. Environmental projects that ultimately aim to regulate production must identify the key veto players and incorporate them strategically from the outset if they are to advance their objectives. |
| Keywords: | state inaction , Thailand (Siam) , resource administration , environment , bureaucracy |
| Date: | 2011–12–07 |
| URL: | http://d.repec.org/n?u=RePEc:jic:wpaper:36&r=sea |
| By: | Barua, Rashmi (Singapore Management University); Vidal-Fernández, Marian (University of New South Wales) |
| Abstract: | Do negative incentives or sticks in education improve student outcomes? Since the late 1980s, several U.S. states have introduced No Pass No Drive (NPND) laws that set minimum academic requirements for teenagers to obtain driving licenses. Using data from the American Community Survey (ACS) and Monitoring the Future (MTF), we exploit variation across state, time, and cohort to show that NPND laws led to a 6.4 percentage point increase in the probability of graduating from high school among black males. Further, we show that NPND laws were effective in reducing truancy and increased time allocated to school-work at the expense of leisure and work. |
| Keywords: | negative incentives, education, allocation of time, dropout, No Pass No Drive laws |
| JEL: | J08 J22 I2 |
| Date: | 2012–04 |
| URL: | http://d.repec.org/n?u=RePEc:iza:izadps:dp6464&r=sea |
| By: | Ben Shepherd (Asian Development Bank Institute (ADBI)); Gloria Pasadilla |
| Abstract: | Development of a vibrant and competitive services sector is a key characteristic of modern economies. In the developed world, services frequently account for two-thirds or three-quarters of all economic activity. The transition from agriculture through manufacturing to a services economy has been the hallmark of economic development for many countries. In line with this trend, we see many emerging markets currently working hard to support and develop services industries, and to put in place the regulatory structures required for more integrated international services markets. Doing so is likely to form an important part of efforts to avoid the so-called “middle income trapâ€, as improving services sector productivity is key to invigorating the economy and supporting the sustained innovation needed to move to high income status. The Association of Southeast Asian Nations ( Broadly speaking, measures aimed at reducing barriers to entry—which make markets less competitive—and lowering the costs of doing business for domestic and foreign service providers alike can have major impacts throughout the economy. A more productive services sector is not only good news for those directly connected with it through investment or employment, but also for other parts of the economy that use services inputs intensively. As just one example, growth in the services sector is one of the foundations on which international goods production networks are built, since it is impossible to move intermediate inputs across borders and undertake complex coordination of production processes without efficient markets for services such as transport, telecommunications, and business processes. ASEAN) countries, along with the People’s Republic of China (PRC), and India (“the ACI countriesâ€), are no strangers to this underlying trend. Although experience differs greatly from one country to another, the data reviewed in this report strongly suggest that an increasing services orientation is likely to be a key feature of the ACI economies over the medium-term. Services trade among the ACI countries has been growing at a very rapid rate over recent years, despite starting from a relatively low baseline. Although data are scarce and must be interpreted with caution, an analysis of applied services sector policies in the region suggests that there is much policymakers can do to intensify this process, and increase the pace at which the transformation to a services economy is taking place. Indeed, services policies in the ACI countries are generally quite restrictive by world standards, even though experiences differ greatly across countries. In addition to traditional services sectors such as finance and telecommunications—where the gains from reform remain potentially large—there are also a number of “sunrise†sectors of interest to the ACI countries. Healthcare is one example, with considerable potential for trade growth through outsourcing of allied health functions, as well as movement of patients, movement of medical personnel, and foreign investment in hospitals and other health care providers. Business process outsourcing has already become an important export earner in regional economies such as India and the Philippines. There is clear scope for policymakers to support expansion of this kind of trade in the future. Regional integration can provide a useful impetus for continued reform of services sector policies, thereby promoting competitiveness more broadly. Priorities for the ASEAN countries include ensuring on the ground implementation of the ASEAN Economic Community Blueprint as it relates to services markets. The same is true of the ASEAN-PRC Trade in Services Agreement, even though only a few countries have made substantially stronger commitments than under the General Agreement on Trade in Services (GATS). Conclusion of a services agreement with India could provide an additional spur to the already rapidly growing services trade between ASEAN and India. |
| Keywords: | China, India, ASEAN, New Engine of Growth, services sector, Emerging Markets, middle income trap, Regional Integration, services sector policies |
| JEL: | O44 Q58 Q56 O10 O53 Q28 O13 Q01 Q43 Q48 Q53 Q54 Q56 Q58 R48 |
| Date: | 2012–03 |
| URL: | http://d.repec.org/n?u=RePEc:eab:develo:23290&r=sea |
| By: | Ben Shepherd (Asian Development Bank Institute (ADBI)); Gloria Pasadilla |
| Abstract: | Development of a vibrant and competitive services sector is a key characteristic of modern economies. In the developed world, services frequently account for two-thirds or three-quarters of all economic activity. The transition from agriculture through manufacturing to a services economy has been the hallmark of economic development for many countries. In line with this trend, we see many emerging markets currently working hard to support and develop services industries, and to put in place the regulatory structures required for more integrated international services markets. Doing so is likely to form an important part of efforts to avoid the so-called “middle income trapâ€, as improving services sector productivity is key to invigorating the economy and supporting the sustained innovation needed to move to high income status. The Association of Southeast Asian Nations ( Broadly speaking, measures aimed at reducing barriers to entry—which make markets less competitive—and lowering the costs of doing business for domestic and foreign service providers alike can have major impacts throughout the economy. A more productive services sector is not only good news for those directly connected with it through investment or employment, but also for other parts of the economy that use services inputs intensively. As just one example, growth in the services sector is one of the foundations on which international goods production networks are built, since it is impossible to move intermediate inputs across borders and undertake complex coordination of production processes without efficient markets for services such as transport, telecommunications, and business processes. ASEAN) countries, along with the People’s Republic of China (PRC), and India (“the ACI countriesâ€), are no strangers to this underlying trend. Although experience differs greatly from one country to another, the data reviewed in this report strongly suggest that an increasing services orientation is likely to be a key feature of the ACI economies over the medium-term. Services trade among the ACI countries has been growing at a very rapid rate over recent years, despite starting from a relatively low baseline. Although data are scarce and must be interpreted with caution, an analysis of applied services sector policies in the region suggests that there is much policymakers can do to intensify this process, and increase the pace at which the transformation to a services economy is taking place. Indeed, services policies in the ACI countries are generally quite restrictive by world standards, even though experiences differ greatly across countries. In addition to traditional services sectors such as finance and telecommunications—where the gains from reform remain potentially large—there are also a number of “sunrise†sectors of interest to the ACI countries. Healthcare is one example, with considerable potential for trade growth through outsourcing of allied health functions, as well as movement of patients, movement of medical personnel, and foreign investment in hospitals and other health care providers. Business process outsourcing has already become an important export earner in regional economies such as India and the Philippines. There is clear scope for policymakers to support expansion of this kind of trade in the future. Regional integration can provide a useful impetus for continued reform of services sector policies, thereby promoting competitiveness more broadly. Priorities for the ASEAN countries include ensuring on the ground implementation of the ASEAN Economic Community Blueprint as it relates to services markets. The same is true of the ASEAN-PRC Trade in Services Agreement, even though only a few countries have made substantially stronger commitments than under the General Agreement on Trade in Services (GATS). Conclusion of a services agreement with India could provide an additional spur to the already rapidly growing services trade between ASEAN and India. |
| Keywords: | China, India, ASEAN, New Engine of Growth, services sector, Emerging Markets, middle income trap, Regional Integration, services sector policies |
| JEL: | O44 Q58 Q56 O10 O53 Q28 O13 Q01 Q43 Q48 Q53 Q54 Q56 Q58 R48 |
| Date: | 2012–03 |
| URL: | http://d.repec.org/n?u=RePEc:eab:tradew:23290&r=sea |