Procyclical Productivity and Returns-to-Scale in Philippine Manufacturing

The Philippines is regarded as a highly oligopolistic economy, and it is argued that this is a cause of the relative stagnation of the economy to neighbouring East Asian economies. This presumption might be associated with increasing returns to scale and market power, which are consistent with the procyclical total factor productivity that is observed in the Philippines and the United States. However, this study found no strong evidence supporting increasing returns for aggregate manufacturing and three-digit manufacturing industries during 1956-1980 in the Philippines, based on data constructed by Hooley (1985). Further, this study does not support external effect discussed in Caballero and Lyons (1992).

Industrial Policy in Asia

This paper examines three types of industrialization that have occurred in East Asia: the Japanese, Chinese and generic Asian models. Industrial policies in Japan and the Republic of Korea (ROK) initially protected local companies from foreign investors by imposing high tariffs on foreign investors. But Japan began introducing liberalization policies to attract foreign direct investment (FDI) in the 1960s, and the ROK began to welcome foreign technology in the 1970s. Meanwhile, the governments of the ASEAN countries and Taiwan established export-processing zones (EPZ) to invite FDI by offering preferential treatment, such as tax deductions and exemptions. China adopted similar industrial policies and also established EPZs, attracting the capital and know-how of multinationals and thereby strengthening the international competitiveness of local enterprises. This paper reaches the following three conclusions. First, it would have been difficult for East Asian countries to grow without FDI. Second, central governments were a crucial factor in these countries' growth strategies. Third, EPZs offering preferential treatment can effectively enhance aggregate growth in developing countries, and the Asian experience shows that this strategy can be applied to other countries that satisfy certain preconditions.

Industrialization in Indonesia since the 1970s

Introduction: During the period from the latter half of the 1980s until just before the Asian currency crisis in 1997, Indonesia’s economic development had drawn expectations and attention from various quarters, along with Malaysia and Thailand within the same Association of Southeast Asian Nations (ASEAN). In fact, the 1993 report by the World Bank, entitled “East Asian Miracle: Economic Growth and Public Policy,” recognized Indonesia as one of the East Asian economies with the strong economic performance, i.e. sustained economic growth (World Bank [1993]). And it was the manufacturing industry that had been the driving force behind Indonesia’s economic growth during that period. Since the 1997 outbreak of the Asian currency crisis, however, the manufacturing sector in Indonesia has been mired in a situation that rules out the kind of bright prospects it had emanated previously. The Indonesian economy is still in the developing stage, and in accordance with the history of industrial structural changes in other countries, Indonesia’s manufacturing industry can still be expected to serve as the engine of the country’s economic development. But is it really possible in an environment where economic liberalization and globalization are forging ahead? And, what sort of problems have to be dealt with to make it possible? To answer these questions, it is necessary to know the current conditions of Indonesia’s manufacturing sector, and to do that, it becomes important to think back on the history of the country’s industrialization. Thus, this paper is intended to retrace and unlock the track of Indonesia’s industrialization up until the establishment of the manufacturing sector in its present form, with the ultimate goal being to give answers to the above-mentioned questions. Subject to an analysis in this paper is the period from the installment of President Soeharto’s administration onward when industrialization of the modern industrial sector2 moved into high gear. 　　　The composition of this paper is outlined below. Section 1 first shows why it is important to examine import substitution and export orientation, both of which are used as the measures of the analysis in this paper, in tracking the history of the industrialization, and then discuss indicators of import substitution and export orientation as well as statistical data and resources needed to develop those indicators. Section 2 clarifies the status of the manufacturing industry among all industries by looking at the composition ratio of the manufacturing industry in terms of value added, imports and exports. Section 3 to 5 cover three periods between 1971 and 1995 and make an analysis of import substitution, export orientation and changes in the industrial structure for each period. Section 3 analyzes the period from 1971 through 1985, when Indonesia pursued the import substitution policy amid the oil boom. Section 4 covers the period from 1985 through 1990, when the packages of deregulatory measures were announced successively under structural adjustment policies made necessary by the fall in oil prices. Section 5 examines the period from 1990 through 1995, which saw the alternate shifts between the overheating of the economy by sharply rising investment by both domestic and foreign investors in the wake of the liberalization of investment, trade and financial services, and polices to cool down the economy. Section 6, which covers the 1995-1999 period straddling the economic crisis, is designed for an analysis of the changes in production trends before and after the economic crisis as well as the changes in the industrial structure. Section 7, after summing up the history of Indonesia’s industrialization examined in the previous sections, discusses problems found in respective sectors and attempts to present future prospects for the country’s manufacturing industry.

Intra-regional trade between China, Japan, and Korea : before and after the financial crisis

East Asian economies have been heavily dependent on the U.S. and EU markets, especially for the export of final goods. Therefore, once the financial crisis hit Western economies hard, the East Asian economies lost their major markets.Their production networks then worked to the region's disadvantage and stifled industrial development.This reflects the vulnerability of the East Asian economies which have adopted an export-led growth strategy. Such vulnerability needs to be addressed to prevent future economic crises, as well as to sustain economic growth. This paper examines the trade structure of the three countries-China, Japan, and Korea-before and after the Lehman Shock, and discusses how the three countries should cooperate in addressing imbalances in the trade structure.

Social movements and the crisis of neoliberalism in Malaysia and Thailand

Of the Southeast Asian countries most badly affected by the 1997 financial crisis, Malaysia and Thailand remain the most unsettled by its political fallout. Their present political situations are not akin to 'politics as usual'. Instead, they capture the unpredicted outcomes of post-crisis struggles to reorganize structures of economic and political power. Comparing the situations in Malaysia and Thailand, this paper focuses on their differing state and civil society engagements with neoliberalism. It is suggested that the post-crisis contestations, sometimes tied to pre-crisis conflicts in political economy, left something of a stalemate: neither neoliberalism nor the social movements satisfactorily fulfilled their agendas in either country.

International labor migration in Vietnam and the impact of receiving countries' policies

Labor export has been part of Vietnam’s socio-economic development strategy since the beginning of the doi moi era. Recent years, Vietnam has sent about 80,000 workers abroad per year. Vietnam has become a major source country of unskilled foreign workers for high-income East Asian countries. However, in these receiving countries, the desertion rate among Vietnamese workers is quite high, compared with that for workers from other countries. This paper examines the impact of Korean and Japanese policies for receiving foreign workers applied to and implemented in Vietnam, as well as the impact of Vietnamese labor sending system, on the problem of runaway workers.

Dated co-occurrence of Homo erectus and Gigantopithecus from Tham Khuyen Cave, Vietnam.

Tham Khuyen Cave (Lang Son Province, northern Vietnam) is one of the more significant sites to yield fossil vertebrates in east Asia. During the mid-1960s, excavation in a suite of deposits produced important hominoid dental remains of middle Pleistocene age. We undertake more rigorous analyses of these sediments to understand the fluvial dynamics of Pleistocene cave infilling as they determine how skeletal elements accumulate within Tham Khuyen and other east Asian sites. Uranium/thorium series analysis of speleothems brackets the Pleistocene chronology for breaching, infilling, and exhuming the regional paleokarst. Clast analysis indicates sedimentary constituents, including hominoid teeth and cranial fragments accumulated from very short distances and under low fluvial energy. Electron spin resonance analysis of vertebrate tooth enamel and sediments shows that the main fossil-bearing suite (S1-S3) was deposited about 475 thousand years ago. Among the hominoid teeth excavated from S1-S3, some represent Homo erectus and Gigantopithecus blacki. Criteria are defined to differentiate these teeth from more numerous Pongo pygmaeus elements. The dated co-occurrence of Homo erectus and Gigantopithecus blacki at Tham Khuyen helps to establish the long co-existence of these two species throughout east Asia during the Early and Middle Pleistocene.

Imperial legacy? The EU's Developmental Model and the Crisis of the European Periphery. CES Papers - Open Forum #19, 2013-2014

The high hopes for rapid convergence of Eastern and Southern EU member states are increasingly being disappointed. With the onset of the Eurocrisis convergence has given way to divergence in the southern members, and many Eastern members have made little headway in closing the development gap. The EU´s performance compares unfavourably with East Asian success cases as well as with Western Europe´s own rapid catch-up to the USA after 1945. Historical experience indicates that successful catch up requires that less-developed economies to some extent are allowed to free-ride on an open international economic order. However, the EU´s model is based on the principle of a level-playing field, which militates against such a form of economic integration. The EU´s developmental model thus contrasts with the various strategies that have enabled successful catch up of industrial latecomers. Instead the EU´s current approach is more and more reminiscent of the relations between the pre-1945 European empires and their dependent territories. One reason for this unfortunate historical continuity is that the EU appears to have become entangled in its own myths. In the EU´s own interpretation, European integration is a peace project designed to overcome the almost continuous warfare that characterised the Westphalian system. As the sovereign state is identified as the root cause of all evil, any project to curtail its room of manoeuvre must ultimately benefit the common good. Yet, the existence of a Westphalian system of nation states is a myth. Empires and not states were the dominant actors in the international system for at least the last three centuries. If anything, the dawn of the age of the sovereign state in Western Europe occurred after 1945 with the disintegration of the colonial empires and thus historically coincided with the birth of European integration.

Benthic foraminiferal assemblages and paleoproductivity reconstructions for the last 550 kyr of the Ontong Java Plateau, western equatorial Pacific

We analyzed foraminiferal and nannofossil assemblages and stable isotopes in samples from ODP Hole 807A on the Ontong Java Plateau in order to evaluate productivity and carbonate dissolution cycles over the last 550 kyr (kilo year) in the western equatorial Pacific. Our results indicate that productivity was generally higher in glacials than during interglacials, and gradually increased since MIS 13. Carbonate dissolution was weak in deglacial intervals, but often reached a maximum during interglacial to glacial transitions. Carbonate cycles in the western equatorial Pacific were mainly influenced by changes of deep-water properties rather than by local primary productivity. Fluctuations of the estimated thermocline depth were not related to glacial to interglacial alternations, but changed distinctly at ~280 kyr. Before that time the thermocline was relatively shallow and its depth fluctuated at a comparatively high amplitude and low frequency. After 280 kyr, the thermocline was deeper, and its fluctuations were at lower amplitude and higher frequency. These different patterns in productivity and thermocline variability suggest that thermocline dynamics probably were not a controlling factor of biological productivity in the western equatorial Pacific Ocean. In this region, upwelling, the influx of cool, nutrient-rich waters from the eastern equatorial Pacific or of fresh waters from rivers have probably never been important, and their influence on productivity has been negligible over the studied period. Variations in the inferred productivity in general are well correlated with fluctuations in the eolian flux as recorded in the northwestern Pacific, a proxy for the late Quaternary history of the central East Asian dust flux into the Pacific. Therefore, we suggest that the dust flux from the central East Asian continent may have been an important driver of productivity in the western Pacific.

(Table) Radiocarbon datings of sediment core BLK-1 obtained from Barkol Lake, China

The Barkol Lake, as a closed inland lake, is located at the northeast Xinjiang in northwest China. A combination of geochemical indicators including d18O and d13C of carbonate, TOC, carbonate contents, as well as grain size proxies and magnetic susceptibility of sediments obtained from a newly recovered section at this lake, provides a high-resolution history of climatic change in the past 9400 years. Multi-indicators reflect that Holocene climatic change in the study region generally follows the Westerly Wind pattern of Holocene, and three climatic periods can be identified. Between 9400 and 7500 cal a B.P., climate was characterized by relatively drier and colder condition. From 7500 to 5800 cal a B.P., a relatively warmer and moister climate prevailed, but between 5800 and 3500 cal a B.P., climate shifted towards warmer and drier conditions. A relatively colder and wetter climate prevailed during 3500~1000 cal a B.P., then it changed towards cold and dry between 1000 and 500 cal a B.P.; after 500 cal a B.P., climate changed towards warm and dry conditions again. This study reflects that during the Middle Holocene (from ca 7000 to 3500 cal a B.P.), variations of carbonate d18O of sediments from several lakes in the northern Xinjiang were synchronous with that of Qinghai Lake, where was strongly influenced by the South Asian monsoon; however, after 3500 cal a B.P. this consistency was interrupted, possibly resulting from a re-domination of the Westerly Wind and the retreat of South Asian monsoon in the northern Xinjiang.

(Table 2) Age determination of sediment core NIOP-C2_929

In this study we present a sea surface temperature (SST) record from the western Arabian Sea for the last 20,000 years. We produced centennial-scale d18O and Mg/Ca SST time series of core NIOP929 with focus on the glacial-interglacial transition. The western Arabian Sea is influenced by the seasonal NE and SW monsoon wind systems. Lowest SSTs occur during the SW monsoon season because of upwelling of cold water, and highest SSTs can be found in the low-productivity intermonsoon season. The Mg/Ca-based temperature record reflects the integrated SST of the SW and NE monsoon seasons. The results show a glacial-interglacial SST difference of ~2°C, which is corroborated by findings from other Arabian Sea cores. At 19 ka B.P. a yet undescribed warm event of several hundred years duration is found, which is also reflected in the d18O record. A second centennial-scale high SST/low d18O event is observed at 17 ka B.P. This event forms the onset of the stepwise yet persistent trend toward Holocene temperatures. Highest Mg/Ca-derived SSTs in the NIOP929 record occurred between 13 and 10 ka B.P. Interglacial SST is ~24°C, indicating influence of upwelling. The onset of Arabian Sea warming occurs when the North Atlantic is experiencing minimum temperatures. The rapid temperature variations at 19, 17, and 13 ka B.P. are difficult to explain with monsoon changes alone and are most likely also linked to regional hydrographic changes, such as trade wind induced variations in warm water advection.

(Table 2) Age model of ODP Site 184-1146

Orbital tuning of benthic d18O is a common approach for assigning ages to ocean sediment records. Similar environmental forcing of the northern South China Sea and the southeast Asian cave regions allows for transfer of the speleothem d18O radiometric chronology to the planktonic and benthic d18O records from Ocean Drilling Program Site 1146, yielding a new chronology with 41 radiometrically calibrated datums, spanning the past 350 kyr. This approach also provides for an independent assessment of the accuracy of the orbitally tuned benthic d18O chronology for the last 350 kyr. The largest differences relative to the latest chronology occur in marine isotope stages (MIS) 5.4, 5.5, 6, 7, and 9.3. Prominent suborbital-scale structure believed to be global in nature is identified within MIS 5.4 and MIS 7.2. On the basis of the radiometrically calibrated chronology, the time constant of the ice sheet is found to be 5.4 kyr at the precession band (light d18O lags precession minima by -55.4°) and 10.4 kyr at the obliquity band (light d18O lags obliquity maxima by 57.4°). These values are significantly shorter than the single 17 kyr time constant originally estimated by Imbrie et al. (1984), based primarily on the timing of terminations I and II and the 15 kyr time constant used by Lisiecki and Raymo (2005, doi:10.1029/2004PA001071).

Paleoclimate reconstruction from Miocene macroflora in Kazakhstan compiled from various publications

25 datasets (13 fossil leaf and pollen assemblages, 12 quantitative palaeoclimatic datasets) are provided in order to analyse Early Miocene palaeoclimate in Kazakhstan. The rich fossil record in Kazakhstan documents that during the Oligocene and Early Miocene this area in Central Eurasia was densely forested with warm-temperate deciduous trees and shrubs of the so-called "Turgayan flora". 29 fossil floras from 13 localities have been selected for a quantitative analysis of the Aquitanian (early Early Miocene) climate situation in Kazakhstan. The assessed mean annual temperatures generally place around 15 °C, while values of mean annual precipitation are of about 1000 mm. In combination with several other climate parameters estimated (temperatures of warmest and coldest months, precipitation rates of wettest, driest and warmest months), these data reflect uniform climatic conditions over several thousands of square kilometres. Data of temperature parameters show slight spatial differentiations, with generally cooler mean annual temperatures and higher seasonality (i.e. warmer summers and colder winters) in the north-eastern part of the study area compared with the south-western area around Lake Aral. As compared with palaeoclimate estimates for the European and East Asian Aquitanian, the central part of the Eurasian continent reveals evident signals of higher seasonality and slightly increased continentality.