Crisis in Japan and the Way Out: A Counterargument to Pessimistic Views

This paper focuses on a review of the present state of, and outlook for the Japanese economy. The paper is composed of three parts. The first describes the interrelation between the crisis-ridden East Asian economies and Japan. I argue that Japan did not cause the Asian currency crisis. The second part describes the current state of the Japanese economy after the bubble burst. I also discuss the medium- and long-term challenges that face the Japanese economy. The third part concentrates on the issue of the "liquidity trap" Japan is experiencing. I argue that the yen's exchange rate is more likely to appreciate than depreciate by pumping liquidity into the economy while interest rates cannot be lowered any further, and therefore a "helicopter money" policy is the only way to induce a positive inflation rate and escape from the liquidity trap.

Financial Cooperation in East Asia

This paper addresses the rationale for financial cooperation in East Asia. It begins by giving a brief review of developments after the Asian currency crisis, and argues that enhancing regional financial cooperation both quantitatively and qualitatively will require: (1) upgrading surveillance capabilities in the region, and (2) creating a clear division of labor between regional institutions and the IMF. It also mentions the issue of membership and the background forces that have led to the duplication of similar forums in East Asia. Although the concern over crisis management is the central issue in East Asian financial cooperation, other issues such as exchange rate policy coordination and fostering regional capital markets are discussed as well.

Stunted and Distorted Industrialization in Myanmar

More than 15 years have passed since Myanmar embarked on its transition from a centrally planned economy to a market-oriented one. The purpose of this paper is to provide a bird-eye's view of industrial changes from the 1990s up to 2005. The industrial sector showed a preliminary development in the first half of the 1990s due to an "open door" policy and liberalization measures. However, a brief period of growth failed to effect any changes in the economic fundamentals. The industrial sector still suffers from poor power supplies, limited access to imported raw materials and machinery, exchange rate instability, limited credit, and frequent changes of government regulation. Public ownership is still high in key infrastructure sectors, and has failed to provide sufficient services to private industries. What the government must do first is to get the fundamentals right.

Theoretical Models Based on a Flowchart Approach to Industrial Cluster Policy

This article examined the issue of whether or not the currency exchange rate, country risk, and cooperate tax rate affect decisions of multinational firms to invest in industrial clusters. First, if the exchange rate between a multinational company in an industry of diminishing returns to scale and a developing country is appreciated, then production in the developing country should increase. Second, if the investment period becomes longer, the currency exchange rate of a multinational company's country should be revalued more in order for it to further invest in the developing country. Third, if the investment period becomes longer, the developing country's risk should become less. Fourth, compensation for the developing country's high risk can be made by lowering its corporate tax rate.

International Competitiveness of Manufacturing Firms in sub-Saharan Africa

As the success of East Asian countries has shown, labor-intensive industry is recognized to lead economic growth in the early stages of development, utilizing relatively low labor costs. This same growth process has already started in South and South East Asian LDCs since the mid-1990s. However, the manufacturing sector in sub-Saharan Africa has been underdeveloped and manufacturing exports, in particular labour-intensive goods, have stagnated. This paper investigates the international competitiveness of the African manufacturing sector and its determinants through an analytical survey of empirical studies and a comparison with Asian low income countries. Empirical evidences indicate that primary factors of competitiveness, namely productivity, labour cost and exchange rate are unfavorable in sub-Saharan Africa. Representative arguments attribute the weak competitiveness to problems in the business environment, factor endowment, and the exchange rate. However, careful review shows that labour cost is beyond the range explained by endowment and misalignment of exchange rates have been reduced in Africa. Moreover, comparison with Asian low income countries which have competitiveness in labour-intensive goods shows no difference in the quality of business environment, while the labour cost is significantly lower than sub-Saharan African countries. Although results should be considered tentative, high labour cost beyond endowment and conservative investment behavior emerge as important factors for the weak competitiveness in sub-Saharan Africa when controlling income level.

Monetary Systems in Developing Countries: An Unorthodox View

This paper analyzes some recent theoretical and practical evidence in terms of economic results of different exchange rate systems. It begins with a historical review and a summary of fixed versus flexible exchange rate systems. Then it compares the experiences of recent currency unions, mostly unilateral, and their relative economic performance during the past currency crises in Latin America, East Asia and Eastern Europe. A set of issues is discussed in order to weigh the overall costs and benefits for several economies. These issues include exchange rates, GDP performance, inflation rates and foreign reserves. The case of Argentina is also considered separately, comparing mostly seigniorage costs and interest-rate savings. The benefits and costs of the producers (central banks/governments) and the consumers (citizens) of money are discussed separately. Free banking is also considered in a fast-changing world where there will probably be fewer but better currencies. Not just the euro is a reality now, but maybe the "amero" and the "worldo" or the "mondo" very soon.

An Empirical Analysis of the Monetary Policy Reaction Function in India

This paper empirically analyzes India’s monetary policy reaction function by applying the Taylor (1993) rule and its open-economy version which employs dynamic OLS. The analysis uses monthly data from the period of April 1998 to December 2007. When the simple Taylor rule was estimated for India, the output gap coefficient was statistically significant, and its sign condition was found to be consistent with theoretical rationale; however, the same was not true of the inflation coefficient. When the Taylor rule with exchange rate was estimated, the coefficients of output gap and exchange rate had statistical significance with the expected signs, whereas the results of inflation remained the same as before. Therefore, the inflation rate has not played a role in the conduct of India’s monetary policy, and it is inappropriate for India to adopt an inflation-target type policy framework.

Financial Policies and Dynamic Game Simulation in Poland and Hungary

Recently, steady economic growth rates have been kept in Poland and Hungary. Money supplies are growing rather rapidly in these economies. In large, exchange rates have trends of depreciation. Then, exports and prices show the steady growth rates. It can be thought that per capita GDPs are in the same level and development stages are similar in these two countries. It is assumed that these two economies have the same export market and export goods are competing in it. If one country has an expansion of monetary policy, price increase and interest rate decrease. Then, exchange rate decrease. Exports and GDP will increase through this phenomenon. At the same time, this expanded monetary policy affects another country through the trade. This mutual relationship between two countries can be expressed by the Nash-equilibrium in the Game theory. In this paper, macro-econometric models of Polish and Hungarian economies are built and the Nash- equilibrium is introduced into them.

Liability dollarization and fear of floating

This paper explores the idea that fear of floating can be justified as an optimal discretionary monetary policy in a dollarized emerging economy. Specifically, I consider a small open economy in which intermediate goods importers borrow in foreign currency and face a credit constraint. In this economy, exchange rate depreciation not only worsens importers' net-worth but also increases the financing amount in domestic currency, therefore exaggerating their borrowing finance premium. Besides, because of high exchange rate pass-through into import prices, fluctuations in the exchange rate also have strong impacts on domestic prices and production. These effects, together, magnify the macroeconomic consequences of the floating exchange rate policy in response to external shocks. The paper shows that the floating exchange rate regime is dominated by the fixed exchange rate regime in the role of cushioning shocks and in welfare terms.

How does country risk matter for foreign direct investment?

In this paper, we aim to identify the political and financial risk components that matter most for the activities of multinational corporations. Our paper is the first paper to comprehensively examine the impact of various components of not only political risk but also financial risk on inward FDI, from both long-run and short-run perspectives. Using a sample of 93 countries (including 60 developing countries) for the period 1985-2007, we find that among the political risk components, government stability, socioeconomic conditions, investment profile, internal conflict, external conflict, corruption, religious tensions, democratic accountability, and ethnic tensions have a close association with FDI flows. In particular, socioeconomic conditions, investment profile, and external conflict appear to be the most influential components of political risk in attracting foreign investment. Among the financial risk components, only exchange rate stability yields statistically significant positive coefficients when estimated only for developing countries. In contrast, current account as a percentage of exports of goods and services, foreign debt as a percentage of GDP, net international liquidity as the number of months of import cover, and current account as a percentage of GDP yield negative coefficients in some specifications. Thus, multinationals do not seem to consider seriously the financial risk of the host country.

Determinants of inbound tourists in Cambodia : a dynamic panel data approach

Understanding the determinants of tourism demand is crucial for the tourism sector. This paper develops a dynamic panel model to examine the determinants of inbound tourists to Siem Reap airport, Phnom Penh airport, and land and waterway borders in Cambodia. Consistent with the consumer theory of tourism consumption, a 10% increase in the origin country GDP per capita is predicted to increase the number of tourist visits to Siem Reap airport by 5.8%. A 10% increase in the real exchange rate between the origin country and Cambodia is predicted to decrease the number of tourist visits by 0.89%. In contrast, the number of foreign tourists in a previous period has little effect on the number of foreign tourists in the current period. Additionally, the determinants are different by the mode of entry to Cambodia.

Inmovilización de TiO2 sobre polímeros transparentes en el UV-A para la eliminación fotocatalítica de tricloroetileno en aire

El gran desarrollo industrial y demográfico de las últimas décadas ha dado lugar a un consumo crecientemente insostenible de energía y materias primas, que influye negativamente en el ambiente por la gran cantidad de contaminantes generados. Entre las emisiones tienen gran importancia los compuestos orgánicos volátiles (COV), y entre ellos los compuestos halogenados como el tricloroetileno, debido a su elevada toxicidad y resistencia a la degradación. Las tecnologías generalmente empleadas para la degradación de estos compuestos presentan inconvenientes derivados de la generación de productos tóxicos intermedios o su elevado coste. Dentro de los procesos avanzados de oxidación (Advanced Oxidation Processes AOP), la fotocatálisis resulta una técnica atractiva e innovadora de interés creciente en su aplicación para la eliminación de multitud de compuestos orgánicos e inorgánicos, y se ha revelado como una tecnología efectiva en la eliminación de compuestos orgánicos volátiles clorados como el tricloroetileno. Además, al poder aprovechar la luz solar como fuente de radiación UV permite una reducción significativa de costes energéticos y de operación. Los semiconductores más adecuados para su empleo como fotocatalizadores con aprovechamiento de la luz solar son aquellos que tienen una banda de energía comparable a la de los fotones de luz visible o, en su defecto, de luz ultravioleta A (Eg < 3,5 eV), siendo el más empleado el dióxido de titanio (TiO2). El objetivo principal de este trabajo es el estudio de polímeros orgánicos comerciales como soporte para el TiO2 en fotocatálisis heterogénea y su ensayo para la eliminación de tricloroetileno en aire. Para ello, se han evaluado sus propiedades ópticas y su resistencia a la fotodegradación, y se ha optimizado la fijación del fotocatalizador para conseguir un recubrimiento homogéneo, duradero y con elevada actividad fotocatalítica en diversas condiciones de operación. Los materiales plásticos ensayados fueron el polietileno (PE), copolímero de etil vinil acetato con distintos aditivos (EVA, EVA-H y EVA-SH), polipropileno (PP), polimetil (metacrilato) fabricado en colada y extrusión (PMMA-C y PMMA-E), policarbonato compacto y celular (PC-C y PC-Ce), polivinilo rígido y flexible (PVC-R y PVC-F), poliestireno (PS) y poliésteres (PET y PETG). En base a sus propiedades ópticas se seleccionaron el PP, PS, PMMA-C, EVA-SH y PVC-R, los cuales mostraron un valor de transmitancia superior al 80% en el entorno de la región estudiada (λ=365nm). Para la síntesis del fotocatalizador se empleó la tecnología sol-gel y la impregnación multicapa de los polímeros seleccionados por el método de dip-coating con secado intermedio a temperaturas moderadas. Con el fin de evaluar el envejecimiento de los polímeros bajo la radiación UV, y el efecto sobre éste del recubrimiento fotoactivo, se realizó un estudio en una cámara de exposición a la luz solar durante 150 días, evaluándose la resistencia química y la resistencia mecánica. Los resultados de espectroscopía infrarroja y del test de tracción tras el envejecimiento revelaron una mayor resistencia del PMMA y una degradación mayor en el PS, PVC-R y EVA SH, con una apreciable pérdida del recubrimiento en todos los polímeros. Los fotocatalizadores preparados sobre soportes sin tratamiento y con tres capas de óxido de titanio mostraron mejores resultados de actividad con PMMA-C, PET y PS, con buenos resultados de mineralización. Para conseguir una mayor y mejor fijación de la película al soporte se realizaron tratamientos químicos abrasivos con H2SO4 y NaOH y tratamientos de funcionalización superficial por tecnología de plasma a presión atmosférica (APP) y a baja presión (LPP). Con los tratamientos de plasma se consiguió una excelente mojabilidad de los soportes, que dio lugar a una distribución uniforme y más abundante del fotocatalizador, mientras que con los tratamientos químicos no se obtuvo una mejora significativa. Asimismo, se prepararon fotocatalizadores con una capa previa de dióxido de silicio con la intervención de surfactantes (PDDA-SiO2-3TiO2 y SiO2FC-3TiO2), consiguiéndose buenas propiedades de la película en todos los casos. Los mejores resultados de actividad con tratamiento LPP y tres capas de TiO2 se lograron con PMMA-C (91% de conversión a 30 ppm de TCE y caudal 200 ml·min-1) mejorando significativamente también la actividad fotocatalítica en PVC-R y PS. Sin embargo, el material más activo de todos los ensayados fue el PMMA-C con el recubrimiento SiO2FC-3TiO2, logrando el mejor grado de mineralización, del 45%, y una velocidad de 1,89 x 10-6 mol· m-2 · s-1, que dio lugar a la eliminación del 100 % del tricloroetileno en las condiciones anteriormente descritas. A modo comparativo se realizaron ensayos de actividad con otro contaminante orgánico tipo, el formaldehído, cuya degradación fotocatalítica fue también excelente (100% de conversión y 80% de mineralización con 24 ppm de HCHO en un caudal de aire seco de 200 ml·min-1). Los buenos resultados de actividad obtenidos confirman las enormes posibilidades que ofrecen los polímeros transparentes en el UV-A como soportes del dióxido de titanio para la eliminación fotocatalítica de contaminantes en aire. ABSTRACT The great industrial and demographic development of recent decades has led to an unsustainable increase of energy and raw materials consumption that negatively affects the environment due to the large amount of waste and pollutants generated. Between emissions generated organic compounds (VOCs), specially the halogenated ones such as trichloroethylene, are particularly important due to its high toxicity and resistance to degradation. The technologies generally used for the degradation of these compounds have serious inconveniences due to the generation of toxic intermediates turn creating the problem of disposal besides the high cost. Among the advanced oxidation processes (AOP), photocatalysis is an attractive and innovative technique with growing interest in its application for the removal of many organic and inorganic compounds, and has emerged as an effective technology in eliminating chlorinated organic compounds such as trichloroethylene. In addition, as it allows the use of sunlight as a source of UV radiation there is a significant reduction of energy costs and operation. Semiconductors suitable to be used as photocatalyst activated by sunlight are those having an energy band comparable to that of the visible or UV-A light (Eg <3,5 eV), being titanium dioxide (TiO2), the most widely used. The main objective of this study is the test of commercial organic polymers as supports for TiO2 to be applied in heterogeneous photocatalysis and its assay for removing trichloroethylene in air. To accomplish that, its optical properties and resistance to photooxidation have been evaluated, and different operating conditions have been tested in order to optimize the fixation of the photocatalyst to obtain a homogeneous coating, with durable and high photocatalytic activity. The plastic materials tested were: polyethylene (PE), ethyl vinyl acetace copolymers with different additives (EVA, EVA-H and EVA -SH), polypropylene (PP), poly methyl (methacrylate) manufactured by sheet moulding and extrusion (PMMA-C and PMMA-E), compact and cellular polycarbonates (PC-C PC-Ce), rigid and flexible polyvinyl chloride (PVC-R and PVC-F), polystyrene (PS) and polyesters (PET and PETG). On the basis of their optical properties PP, PS, PMMA-C, EVA-SH and PVC-R were selected, as they showed a transmittance value greater than 80% in the range of the studied region (λ = 365nm). For the synthesis of the photocatalyst sol-gel technology was employed with multilayers impregnation of the polymers selected by dip-coating, with intermediate TiO2 drying at moderate temperatures. To evaluate the polymers aging due to UV radiation, and the effect of photoactive coating thereon, a study in an sunlight exposure chamber for 150 days was performed, evaluating the chemical resistance and the mechanical strength. The results of infrared spectroscopy and tensile stress test after aging showed the PMMA is the most resistant sample, but a greater degradation in PS, PVC-R and EVA SH, with a visible loss of the coating in all the polymers tested. The photocatalysts prepared on the untreated substrates with three layers of TiO2 showed better activity results when PMMA-C, PET and PS where used. To achieve greater and better fixation of the film to the support, chemical abrasive treatments, with H2SO4 and NaOH, as well as surface functionalization treatments with atmospheric pressure plasma (APP) and low pressure plasma (LPP) technologies were performed. The plasma treatment showed the best results, with an excellent wettability of the substrates that lead to a better and uniform distribution of the photocatalyst compared to the chemical treatments tested, in which no significant improvement was obtained. Also photocatalysts were prepared with the a silicon dioxide previous layer with the help of surfactants (SiO2- 3TiO2 PDDA-and-3TiO2 SiO2FC), obtaining good properties of the film in all cases. The best activity results for LPP-treated samples with three layers of TiO2 were achieved with PMMA-C (91% conversion, in conditions of 30 ppm of TCE and 200 ml·min-1 air flow rate), with a significant improvement of the photocatalytic activity in PVC-R and PS samples too. However, among all the materials assayed, PMMA-C with SiO2FC-3TiO2 coating was the most active one, achieving the highest mineralization grade (45%) and a reaction rate of 1,89 x 10-6 mol· m-2 · s-1, with total trichloroethylene elimination in the same conditions. As a comparative assay, an activity test was also performed with another typical organic contaminant, formaldehyde, also with good results (100% conversion with 24 ppm of HCHO and 200 ml·min-1 gas flow rate). The good activity results obtained in this study confirm the great potential of organic polymers which are transparent in the UV-A as supports for titanium dioxide for photocatalytic removal of air organic pollutants.

Natural ventilation in underground wine cellars

The main objective of this research is to promote passive thermal design techniques in the construction of wineries. Natural ventilation in underground cellars is analyzed, focusing on the entrance tunnel, the ventilation chimney and the cave. A monitoring system was designed in order to detect changes in the indoor conditions and outdoor air infiltration. Monitoring process was carried out during one year. Results show the influence of outside temperature, ventilation chimney and access tunnel on the conditions inside the underground cellar. During hot periods, natural ventilation has a negligible influence on the indoor ambience, despite the permanently open vents in the door and chimney. The tunnel and ventilation chimney work as a temperature regulator, dampening outside fluctuations. Forced ventilation is necessary when a high air exchange ratio is needed. During cold periods, there is greater instability as a result of increased natural ventilation. The temperature differences along the tunnel are reduced, reflecting a homogenization and mixing of the air. The ventilation flow is sufficient to modify the temperature and relative humidity of the cave. Forced ventilation is not necessary in this period. During the intermediate periods --autumn and spring-- occurs different behaviors based on time of day.

Evaluación de la distribución de riesgos en los distintos modelos de asociación público-privada para la provisión de infraestructura carretera en México

México es de los pocos países en el mundo que ha realizado dos grandes programas para la construcción de autopistas en colaboración con el sector privado. El primero, fue realizado entre 1989 y 1994, con resultados adversos por el mal diseño del esquema de concesiones; y, el segundo con mejores resultados, en operación desde 2003 mediante nuevos modelos de asociación público-privada (APP). El objetivo de la presente investigación es estudiar los modelos de asociación público-privada empleados en México para la provisión de infraestructura carretera, realizando el análisis y la evaluación de la distribución de riesgos entre el sector público y privado en cada uno de los modelos con el propósito de establecer una propuesta de reasignación de riesgos para disminuir el costo global y la incertidumbre de los proyectos. En la primera parte se describe el estado actual del conocimiento de las asociaciones público-privadas para desarrollar proyectos de infraestructura, incluyendo los antecedentes, la definición y las tipologías de los esquemas APP, así como la práctica internacional de programas como el modelo británico Private Finance Initiative (PFI), resultados de proyectos en la Unión Europea y programas APP en otros países. También, se destaca la participación del sector privado en el financiamiento de la infraestructura del transporte de México en la década de 1990. En los capítulos centrales se aborda el estudio de los modelos APP que se han utilizado en el país en la construcción de la red de carreteras de alta capacidad. Se presentan las características y los resultados del programa de autopistas 1989-94, así como el rescate financiero y las medidas de reestructuración de los proyectos concesionados, aspectos que obligaron a las autoridades mexicanas a cambiar la normatividad para la aprobación de los proyectos según su rentabilidad, modificar la legislación de caminos y diseñar nuevos esquemas de colaboración entre el gobierno y el sector privado. Los nuevos modelos APP vigentes desde 2003 son: nuevo modelo de concesiones para desarrollar autopistas de peaje, modelo de proyectos de prestación de servicios (peaje sombra) para modernizar carreteras existentes y modelo de aprovechamiento de activos para concesionar autopistas de peaje en operación a cambio de un pago. De estos modelos se realizaron estudios de caso en los que se determinan medidas de desempeño operativo (niveles de tráfico, costos y plazos de construcción) y rentabilidad financiera (tasa interna de retorno y valor presente neto). En la última parte se efectúa la identificación, análisis y evaluación de los riesgos que afectaron los costos, el tiempo de ejecución y la rentabilidad de los proyectos de ambos programas. Entre los factores de riesgo analizados se encontró que los más importantes fueron: las condiciones macroeconómicas del país (inflación, producto interno bruto, tipo de cambio y tasa de interés), deficiencias en la planificación de los proyectos (diseño, derecho de vía, tarifas, permisos y estimación del tránsito) y aportaciones públicas en forma de obra. Mexico is one of the few countries in the world that has developed two major programs for highway construction in collaboration with the private sector. The first one was carried out between 1989 and 1994 with adverse outcomes due to the wrong design of concession schemes; and, the second one, in operation since 2003, through new public-private partnership models (PPPs). The objective of this research is to study public-private partnership models used in Mexico for road infrastructure provision, performing the analysis and evaluation of risk’s distribution between the public and the private sector in each model in order to draw up a proposal for risk’s allocation to reduce the total cost and the uncertainty of projects. The first part describes the current state of knowledge in public-private partnership to develop infrastructure projects, including the history, definition and types of PPP models, as well as international practice of programs such as the British Private Finance Initiative (PFI) model, results in the European Union and PPP programs in other countries. Also, it stands out the private sector participation in financing of Mexico’s transport infrastructure in 1990s. The next chapters present the study of public-private partnerships models that have been used in the country in the construction of the high capacity road network. Characteristics and outcomes of the highway program 1989-94 are presented, as well as the financial bailout and restructuring measures of the concession projects, aspects that forced the Mexican authorities to change projects regulations, improve road’s legislation and design new schemes of cooperation between the Government and the private sector. The new PPP models since 2003 are: concession model to develop toll highways, private service contracts model (shadow toll) to modernize existing roads and highway assets model for the concession of toll roads in operation in exchange for a payment. These models were analyzed using case studies in which measures of operational performance (levels of traffic, costs and construction schedules) and financial profitability (internal rate of return and net present value) are determined. In the last part, the analysis and assessment of risks that affect costs, execution time and profitability of the projects are carried out, for both programs. Among the risk factors analyzed, the following ones were found to be the most important: country macroeconomic conditions (inflation, gross domestic product, exchange rate and interest rate), deficiencies in projects planning (design, right of way, tolls, permits and traffic estimation) and public contributions in the form of construction works.

UMA ANÁLISE DA RELAÇÃO ENTRE VARIÁVEIS MACROECONÔMICAS E O COMPORTAMENTO DAS AÇÕES DE MAIOR LIQUIDEZ DO ÍNDICE IBOVESPA

As ações de maior liquidez do índice IBOVESPA, refletem o comportamento das ações de um modo geral, bem como a relação das variáveis macroeconômicas em seu comportamento e estão entre as mais negociadas no mercado de capitais brasileiro. Desta forma, pode-se entender que há reflexos de fatores que impactam as empresas de maior liquidez que definem o comportamento das variáveis macroeconômicas e que o inverso também é uma verdade, oscilações nos fatores macroeconômicos também afetam as ações de maior liquidez, como IPCA, PIB, SELIC e Taxa de Câmbio. O estudo propõe uma análise da relação existente entre variáveis macroeconômicas e o comportamento das ações de maior liquidez do índice IBOVESPA, corroborando com estudos que buscam entender a influência de fatores macroeconômicos sobre o preço de ações e contribuindo empiricamente com a formação de portfólios de investimento. O trabalho abrangeu o período de 2008 a 2014. Os resultados concluíram que a formação de carteiras, visando a proteção do capital investido, deve conter ativos com correlação negativa em relação às variáveis estudadas, o que torna possível a composição de uma carteira com risco reduzido.