Economics Working Papers

The Economics Working Papers series is a forum for stimulating discussion on research and policy studies that deal with economic and development problems facing the Asia and Pacific region.

  • 01 Oct 2012 | Publication

    Adoption of CFLs and Electrical Lighting Usage in Pakistan

    The widespread adoption of compact fluorescent light bulbs (CFLs) have been advocated on the premise that it will result in significant savings in electricity and reduced carbon emissions. Using a household level survey of electrical lighting and usage in Pakistan, we examine the decision to adopt CFLs and the subsequent impact of CFL adoption on electricity usage. CFL adoption is significantly influenced by variables that proxy for income and the perceived expectations about the life span of CFLs.
  • 01 Oct 2012 | Publication

    Ending 'Too Big To Fail': Government Promises versus Investor Perceptions

    Can a government credibly promise not to bailout firms whose failure would have major negative systemic consequences? Our analysis of the Republic of Korea's 1997-1999 crisis, suggests an answer: No. Despite a general "no bailout" policy during the crisis, the largest Korean corporate groups (chaebol)-facing severe financial and governance problems-could still borrow heavily from households through issuing bonds at prices implying very low expected default risk.
  • 01 Oct 2012 | Publication

    Government Fiscal Policies and Redistribution in Asian Countries

    This paper assesses the impact of government fiscal policies on income inequality in Asia.
  • 01 Oct 2012 | Publication

    A Note to Schooling in Development Accounting

    How much would output increase if underdeveloped economies were to increase their levels of schooling? We contribute to the development accounting literature by describing a non-parametric upper bound on the increase in output that can be generated by more levels of schooling. The advantage of our approach is that the upper bound is valid for any number of schooling levels with arbitrary patterns of substitution/complementarity.
  • 01 Sep 2012 | Publication

    On Measuring Human Capital: A Case Study of Viet Nam

    This study develops a productivity-based single measure of human capital, taking account different levels of education and productivity differentials across workers. Using this new measure, the paper presents empirical estimates of human capital in Viet Nam and compares the stock of human capital contributed by vocational and general education. It also deals with equity in human capital particularly as contributed by vocational education, and measures this equity across income quintiles and various socioeconomic and demographic groups in Viet Nam.
  • 01 Sep 2012 | Publication

    Do Contagion Effects Exist in Capital Flow Volatility?

    The paper aims to assess what influences volatility of capital flows to emerging countries and whether or not there is a spillover or contagion effect in the volatility. The empirical results suggest strong and significant contagion effects from global and regional volatilities on the volatility of capital flows in different types to individual economies. The evidence of contagion from global and regional volatilities implies that there is a strong need for global and regional policy cooperation to contain the spillover or contagion effects.
  • 01 Jul 2012 | Publication

    Vertical Gravity

    The paper examines the drivers of international production networks and vertical trade integration in an augmented gravity model that employs the newly developed Network Trade Index. Based on bilateral trade data among 75 countries from 1998 to 2005, the findings emphasize trade policy's role in facilitating network trade. For example, a 10% tariff reduction raises vertical trade by 6.2%, on average. Preferential trade agreements are found to significantly boost vertical integration.
  • 01 Jun 2012 | Publication

    Global Value Chains and the Transmission of Business Cycle Shocks

    In this paper, we investigate empirically two channels through which a country's integration into global value chains (GVCs) may increase the income elasticity of its exports. First, GVCs may simply be concentrated in sectors that are more sensitive to external income fluctuations (a composition effect). Alternatively, some characteristics inherent to GVCs may trigger a faster and more amplified propagation of business cycle shocks (a supply chain effect). Using trade data of the People's Republic of China, we find supporting evidence for the composition effect.
  • 01 Jun 2012 | Publication

    Inequality of Human Opportunities in Developing Asia

    The paper analyzes equity of opportunity in basic education and infrastructure services in seven developing countries, namely, Bangladesh, Bhutan, Indonesia, Pakistan, the Philippines, Sri Lanka, and Viet Nam.
  • 01 Apr 2012 | Publication

    Malaysia's Investment Malaise: What Happened and Can It be Fixed?

    Private investment in Malaysia has never fully recovered from the impact of the Asian financial crisis (AFC). Both domestic and foreign investment have remained lackluster post-AFC; while foreigners continue to shun Malaysia, it seems even domestic investors are fleeing as well, with Malaysia having become a net exporter of capital since 2005. The crucial questions are: what happened and can it be fixed?