The Policy Making Process in FTA Negotiations: A Case Study of Japanese Bilateral EPAs

This paper analyzes Japanese bilateral EPA negotiations, focusing on the areas that each country decided were most important, as well as which actors played the most important roles in each set of negotiations. The negotiations with Mexico and Thailand, which tried to increase agricultural exports to Japan through FTAs, will be discussed. Japan, one should note, still seeks to protect its agricultural sector in spite of the spread of liberalization. The Philippines, Thailand and Malaysia’s efforts to improve and compete in developing their automotive industries, in the face of the completion of AFTA in 2010, are also examined. In addition, this paper discusses whether economic cooperation, the essential Japanese strategy in EPA negotiations, alters the negotiation process in any significant way.

TNCs in Perplexity over How to Meet Local Suppliers: The Case of Philippine Export Processing Zone

Transnational Corporations (TNCs) have played a vital role in fostering rapid industrialisation in many developing countries. The Philippines is the case. However, the country has been far lagging behind other ASEAN members in economic performance. The present study examines this issue, mainly focusing on the linkage formation between TNCs affiliates and Philippine local suppliers. Three factors are proposed to determine the overall performance of linkage formation; i.e., outsourcing strategies of TNCs’ local affiliates, local entrepreneurial response, and host government policies. An economic enclave structure is clearly identified in the Philippines, in which only a few locally-owned suppliers have emerged.　Extremely weak local entrepreneurship in the Philippines is identified to explain the poor performance of linkage formation.

Interaction of powers in the Philippine presidential system

The executive - legislative relations in the Philippines have been described in two contrasting stories, namely the "strong president" story, and the "strong congress" story. This paper tries to consolidate the existing arguments and propose a new perspective focusing on the "compromise exchange" between the president and the congress across the different policy areas. It considers that the policy outcome is not brought by unilateral power of the president or the congress, but formed as the product of such an exchange. Interaction of powers and their complementary function are addressed. Furthermore, aside from the constitutional power, the weak party discipline is pointed out as a key factor in making the exchange possible.

No insulation : politics and technocracy's troubled trajectory

Technocracy often holds out the promise of rational, disinterested decision-making. Yet states look to technocracy not just for expert inputs and calculated outcomes but to embed the exercise of power in many agendas, policies and programs. Thus, technocracy operates as an appendage of politically constructed structures and configurations of power, and highly placed technocrats cannot be 'mere' backroom experts who supply disinterested rational-technical solutions in economic planning, resource allocation and social distribution, which are inherently political. This paper traces the trajectories of technocracy in conditions of rapid social transformation, severe economic restructuring, or political crises - when the technocratic was unavoidably political.

Political institutions and policy outcomes : effects of presidential vetoes on budget making

The article examines how the power distribution between the executive and the legislature under the Presidential system affects policy outcomes. We focus in particular on the presidential veto, both package and partial. Using a simple game theory model, we show that the presidential partial veto generally yields a result in favor of the President, but that such effects vary depending on the reversion points of the package veto and the Congress's possible use of sanctions against the President. The effects of the Presidential partial veto diminish if the reversion point meets certain conditions, or if the Congress has no power to impose sufficient sanctions on the President when the President revises the outcome ex-post. To clarify and explain the model, we present the case of budget making in the Philippines between 1994 and 2008. In the Philippines, the presidential partial veto has been bringing expenditure programs closer to the President's ideal point within what may be called the Congress's indifference curve. The Congress, however, has not always passed budget bills and from time to time has carried over the previous year's budget, in years when the budget deficit increased. This is the situation that the policy makers cannot retrieve from the reversion point.

The urban middle class in the instability of new democracies

The recent revolts of the middle class in the national capitals of the Philippines and Thailand have raised a new question about democratic consolidation. Why would the urban middle class, which is expected to stabilize democracy, expel the democratically elected leaders through extra-constitutional action? This article seeks to explain such middle class deviation from democratic institutions through an examination of urban primacy and the change in the winning coalition. The authoritarian regime previously in power tended to give considerable favor to the primate city to prevent it revolting against the ruler, because it could have become a menace to his power. But after democratization the new administration shifts policy orientation from an urban to rural bias because it needs to garner support from rural voters to win elections. Such a shift dissatisfies the middle class in the primate city. In this article I take up the Philippines as a case study to examine this theory.

Chapter 3 Knowledge Exchanges and Innovation in Connected Firms: Evidence from Upstream-Downstream Relationships

This paper proposes evidences for linking innovation and knowledge exchanges in developing economies towards a comprehensive theory of new economic geography in the knowledge based spatial economy. Firms which dispatched engineers to customers achieved more innovations than firms which did not. Mutual sharing of knowledge also stimulates innovations. A just-in-time relationship is effective for dealing with upgrading production process. But such strong complementarities with partners are not effective for product innovation.. These evidences support the hypothesis that face-to-face communication and complementarities among production linkages have different roles in knowledge creation.

Location choice in low-income countries : evidence from Japanese investments in East Asia

Unlike most existing studies, this paper examines the location choices of MNEs in developing countries. Specifically, we investigate the location choices of Japanese MNEs among East Asian developing countries by estimating a four-stage nested logit model at the province level. Noteworthy results of location elements are as follows. As is consistent with the mechanics of cheap labor-seeking FDI, Japanese MNEs are more likely to invest in locations with low income and low tariff rates on products from Japan. Also, accessibility to other locations and/or ports matters in attracting Japanese MNEs because it is crucial in importing materials and exporting their products. In addition, WTO membership and bilateral investment treaties are important because these contribute to the settlement of trade and investment disputes, which is more likely to be necessary in developing countries.

Establishing electoral administration systems in new democracies

The difficulty of holding fair elections continues to be a critical problem in many newly democratized countries. The core of the problem is the electoral administration's lack of political autonomy and capability to regulate fraud. This paper seeks to identify the conditions for establishing an autonomous and capable electoral administration system. An electoral administration system has two main functions: to disclose the nature of elections and to prevent fraud. We argue in this paper that an autonomous and capable electoral administration system exists if the major political players have the incentive to disclose the information on the elections and to secure the ruler's credible commitment to fair elections. We examine this argument through comparative case studies of Korea and the Philippines. Despite similar historical and institutional settings, their election commissions exhibit contrasting features. The difference in the incentive structures of the major political players seems to have caused the divergence in the institutional evolution of the election commissions in the two countries.

政治制度と政策帰結 -- 予算策定過程における大統領拒否権の効果

本稿では，大統領制のもとでの執政府と立法府の権限配分が政策帰結に与える影響を考える。特に 予算策定過程における大統領の部分的拒否権の役割に注目し，部分的拒否権が大統領に有利な政策帰 結を生み出すものの，全体拒否権が行使されたときの回帰点の位置次第で，あるいは，議会がどの程 度大統領に制裁を行使できるか次第で，部分的拒否権の効果が失われ，回帰点から離脱できない状況 が生まれることを示す。これを検証するため，フィリピンにおける予算策定過程（1994～2008年） を事例としてとりあげる。フィリピンでは，一般歳出法制定に関して大統領に部分的拒否権が与えら れているため大統領優位に予算策定が行われてきた。しかし，財政赤字拡大が進行した時期には，議 会が一般歳出法を制定せず，前年度予算の再執行を行っており，これは回帰点から離脱できない状況 と考えられる。

新興民主主義の不安定 -- 勝利連合の変更と制度からの逸脱

本稿は，新興民主主義の不安定化を，民主化による勝利連合の変更から説明しようとするものである。基本として民主主義体制における政治的不安定は，主要な政治的プレーヤー，具体的には，権力者もしくは権力外主体の２者のいずれかが，民主主義制度から逸脱しようとするインセンティブを持つ状態だと考える。ここで権力外主体の逸脱行為に焦点を当てた場合，不安定化は権威主義体制期に権力を支えた勝利連合が民主化後，勝利連合から外れ，新しい政策傾向に不満を持つことによって発生すると考えられる。権力外主体の不満が，自らの勢力規模との関係である閾値を越えたとき，制度外行動による権力者への挑戦行為を引き起こすのである。ゆえに，政治的不安定化は権力者と権力外主体の利得の差と権力外主体の勢力規模に規定される。本稿では都市と農村の亀裂を例としてこの勝利連合の変更と制度からの逸脱について理論化を試みる。さらに，理論を検証するため，フィリピンの事例を取りあげる。フィリピンでは，民主化後にそれまでの都市セクター偏重が転換され，都市は政権に対して恒常的に不支持の傾向を示してきた。そうしたなか，2001年には，都市エリートを中心として，大統領を排除しようとする憲法制度外行動が発生し，権力者が交代することになった。

Where does Philippine education go? : the "K to 12" program and reform of Philippine basic education

In 2012 the Philippines launched its "K to 12" Program, a comprehensive reform of its basic education. Through this reform, the Philippines is catching up with global standards in secondary education and is attaching a high value to kindergarten. The structure, curricula, and philosophy of the education system are undergoing reform and improvement. The key points of the new policy are "preparation" for higher education, "eligibility" for entering domestic and overseas higher educational institutions, and immediate "employability" on graduating, all leading toward a "holistically developed Filipino". This policy appears admirable and timely, but it faces some pedagogical and socioeconomic problems. The author wants to point out in particular that the policy needs to address gender problems and should be combined with demand-side approaches in order to promote poverty alleviation and human development in the Philippines.

The asset/liability structure of the Philippine banks and non-bank financial institutions in 2000s : a preliminary study for financial access analyses

Based on the consolidated statements data of the universal/commercial banks (UKbank) and non-bank financial institutions with quasi-banking licenses, this paper presents a keen necessity of obtaining data in detail on both sides (assets and liabilities) of their financial conditions and further analyses. Those would bring more adequate assessments on the Philippine financial system, especially with regard to each financial subsector's financing/lending preferences and behavior. The paper also presents a possibility that the skewed locational and operational distribution exists in the non-UKbank financial subsectors. It suggests there may be a significant deviation from the authorities' (the BSP, SEC and others) intended/anticipated financial system in the banking/non-bank financial institutions' real operations.

The stakes of politics and electoral administration : a comparative study of Southeast Asian democracies

Elections play a crucial role in political stability in post-democratization, and electoral administrations are the key to the electoral process. However, not all newly democratized countries have established reliable electoral administration. New democracies in Southeast Asia, such as the Philippines, Indonesia and Thailand, have independent election commissions which have different characteristics, especially in terms of neutrality. Based on three cases, this paper claims that the stakes of politics are the major determinant of the variations in neutrality. The high stakes of politics in Thailand brought about the partisan election commission, while the low stakes in Indonesia made the electoral system relatively neutral. Like Thailand, the high stakes of politics in the Philippines also cause political intervention in the electoral administration.