Asian Economies Research Articles

Drivers of female entrepreneurship in Asian economies: a panel data analysis

Drivers of female entrepreneurship in Asian economies: a panel data analysis

Role of Economic Growth and Government Health Expenditures in Determining Life Expectancy in Selected Asian Countries

Life expectancy is indispensable to Asian countries that are endeavoring to attain socioeconomic development completely by making many investments in the health and education sectors. Current research focuses on determinants of life expectancy in selected Asian economies by using panel data from 15 nations. Fixed effect results highlight that domestic general government health expenditures, economic growth, and urban population are contributing to improved life expectancy at birth. However, the unemployment rate seems to be deteriorating the life expectancy at birth in these Asian economies. The Governments of these economies must provide more educational and health facilities along with job chances to the general people. Moreover, health and educational expenditures must be the maximum share of GDP in these economies.

Exploring the role of Fintech, Green Finance and Natural Resources towards Environmental Sustainability: A study on ASEAN economies

ASEAN economies have seen a staggering rise in natural calamities in recent years. Hence, there is an urgent need for the ASEAN economies to develop meaningful strategies to address climate change and create sustainable development opportunities for future generations. The use of Natural Resources (NTR) for such development results in the emission of carbon dioxide (CO2), which harms Environmental Sustainability (ENS). On the other hand, the use of Fintech (FNT) can be a game-changer that would help to maintain high levels of economic growth and eradicate the issues related to the environment. Additionally, the use of Green Finance (GFIN) can also play a starring role in ENS by diverting funds for green growth in an economy. Therefore, the present study explores the role of Fintech, Green Finance and Natural Resources towards Environmental Sustainability. Such a role was explored through a recent and unique statistical technique named the “Cross-section augmented autoregressive distributed lags test” (CS-ARDL). Results of the study show that Fintech can be a gateway for providing the funding needed for green growth, while similarly, Green Finance can also be used to promote green investment and develop green and sustainable projects. The continued use and extraction of Natural Resources, however, can have a detrimental impact on the environment of the ASEAN countries. ASEAN countries are recommended to introduce a carbon tax to ensure that the firms are forced to reduce their CO2 emissions. This taxation should be followed by incentives for the use of renewable energy through the provision of Green Finance. Green bonds can be an ideal finance mechanism to boost Environmental Sustainability in the region.

Financial Inclusion and Financial Development Determine Human Development in Selected Asian Countries

The research highlights the crucial role of accessible financial services and robust financial systems in enhancing human development outcomes, offering valuable insights for policy-makers aiming to foster inclusive economic growth. This research makes an effort to highlight that financial inclusion and financial development with other major factors determine human development in some selected Asian economies. The authors make use of panel data from 8 Asian nations for the year 2005 to 2018. The dependent variable is the human development index. However, financial inclusion, financial development, urban population, and general government final consumption expenditure are taken as explanatory factors in this analysis. Fixed effect results show that financial inclusion with financial development, urban population, and general government final consumption expenditures have enhanced the human development of Asian countries. The study findings recommend for maximum financial approach and financial amenities in improving the human development of nations. There is a dire need for more improved quality of education for high living standards and development.

Quantifying the digital economy according to the proposed framework

Methods. The article is based on a thorough analysis of data on the development of the digital economy, obtained from experts, researchers and partners specializing in the collection and processing of statistical data. The concept proposed in the article is formed based on both the basic definition of the digital economy and the methodology of measuring its scale basing on the calculation of added value. The digital economy estimation method is based on the use of national accounts and reflects the digital economy in the general context of gross domestic product (GDP). Results. The article examines the role of digital technologies in the socio-economic development of society. The changes that the modern model of interaction between business and society undergoes under the influence of digitalization processes are demonstrated. Special attention is paid to the research of existing systems for measuring the scale of the digital economy. The possibility of applying an approach to the assessment of the digitalization of the economy, which is based on the macroeconomic approach of consumption-output, proposed by W. Leontief, is considered. For its implementation, available data from the system of national accounts were used, namely: information on sixteen economies in Asia, Europe, North America and the Pacific region, including Australia. The study identified digitized sectors around the core perimeter of the digital economy, and predicted that countries with high imports of digital products, as well as industries that are highly dependent on the functioning of core digital sectors, are likely to have lower digital economy scores than others. Novelty. An improved methodological approach to measuring the scale of the digital economy is proposed, which consists in estimating its share in the total GDP of the country based on the calculation of the added value of a set of key digital products created within the national economy. Practical value. The results of the study are relevant to modern global problems, as they form a comprehensive statistical perspective of the review of the development of the digital economy.

Application of KL distance-based intelligent recommendation method to fund recommendation for users with investment behavior in Asia Region

Over the past decade, the spectacular growth of many economies in Asia has amazed the economics profession and Asian people's quality of life has been significantly improved. Therefore, people's savings are increasing. The booming financial market attracts more people to invest in funds for its relatively low risk and high returns. This research first analyzed the widely used recommendation algorithms. Then it adopted the K-medoids clustering algorithm based on KL divergence to make recommendations. The recommendations were also based on the user-item rating matrix. First, the improved Kullback-Leibler distance was used to calculate the distance and similarity between the funds. Next, the data set of n funds were split by the K-medoids clustering technique into k clusters to obtain funds that were similar to the target fund. Finally, the prediction accuracy of the KL-KM recommendation algorithm was compared with those of traditional recommendation algorithms. When the number of recommendations changed from 1 to 5, the average minimum KL distance varied from 0.16, 0.22, 0.29, 0.31, to 0.39. The average KL similarity is 0.85, 0.83, 0.79, 0.74, and 0.72, respectively, and the average absolute error is 0.83, 0.82, 0.82, 0.83, and 0.82, respectively. The root mean square error (RMSE) of the proposed algorithm is 0.93, 0.94, 0.93, 0.94 and 0.94, respectively. Therefore, the proposed recommendation model has a better recommendation performance than existing models to meet users' demands. This algorithm generates recommendations of similar funds based on customers' purchase history. Moreover, principal component analysis is used to simplify the large data set of indicator values into a smaller set while still maintaining significant patterns and trends, thereby improving the accuracy and reducing the complexity of the model.

Businesspeople Becoming Politicians: A Paradigm Shift and Challenges/Opportunities Ahead

The political environment is one of the most crucial factors that shapes the direction of businesses at any point in time. Bangladesh has been practicing democracy for more than three decades and has enjoyed a period of relative stability for more than a decade. This emerging economy of South Asia has been witnessing a noticeable development in its business sector, which constitutes several industries across the country. As a parliamentary form of governance has now been in place for a period of time, a number of business leaders, primarily the owners of businesses in Bangladesh, have begun to engage in politics more actively than was the case previously. In Bangladesh, politics was formerly predominantly controlled by veteran politicians coming from the root level of the political parties, but now an evident transformation has occurred. This article aims to identify the influence of business leaders on policymaking. As policies ultimately determine the future of employees, who are also the citizens of Bangladesh, this whole issue clearly requires a close examination. The article employs secondary data in order to analyze the relationship between the business owners’ involvement in politics and the changes that have taken place as a result of this. As business and politics work hand in hand on a global scale, the author explains the potential opportunities and challenges that this paradigm shift will create for Bangladesh.

Multidimensional child poverty in South Korea: developing measures to assess progress towards the sustainable development goals

This article presents the development of a measure to assess the prevalence and patterning of multidimensional child poverty in South Korea. The first goal of UN’s Sustainable Development Goals (SDGs) is to reduce poverty in all its dimensions, and countries are increasingly developing their own measures of multidimensional poverty. This flourishing of different measures presents challenges for international comparisons. The article applies an internationally-validated method of assessing multidimensional poverty to demonstrate its suitability for use in a high-income Asian economy. Multidimensional child poverty is assessed by combining data on child material deprivation with their household income. Using data from the 2018 Korean National Children Survey, we show that child material deprivation is higher (15%) than income poverty (12%). When measured using a combined measure of material deprivation and income, around one in every three children in Korea were found to be either poor or vulnerable to poverty. These findings show that the official monetary poverty measure on its own may understate the percentage of children unable to afford necessities in Korea, as envisioned by international targets like the SDGs. In terms of policy, analysis of individual deprivations suggests that a combination of in-kind benefits such as vouchers for leisure activities or education and asset-building programmes as well as cash transfers are needed for tackling child poverty.

Подъем протекционизма в политике США и ЕС: как это повлияет на Восточную Азию?

Global political economy has been experiencing a new normal period through the COVID-19 pandemic and theUkraine War since Jan. 2020. At the same time, the trade conflict between the USA and China has been continuingsince the Trump Administration and even expanding to the technology conflict under the Biden Administration thathas enhanced protectionism in the world trade. Due to these conflicts, discussions on de-globalization or re-globalizationare raised. The two expected or unexpected historical events have resulted in a long wave of high inflation,energy and food crises, disorder of global supply chains etc. in the global economy, which is known as a new normalera shifted from low inflation, well-functioning global supply chains (GSCs) based on division of labor. In order tostrengthen its economic and political leadership, the Biden government has upgraded the Trump’s America FirstPolicy to the Made in America Policy based on Chips and Science Act (CSA) and Inflation Reduction Act (IRA),which represent a new era of protectionism. In parallel, the EU has also considered to impose Net Zero Industry Act(NZIA) and other Acts. The research hypothesis is that protectionism in the name of economic security generatesinstability of the world trade. Its result may be negative impacts of some East Asian economies. This paper aims toanalyze the new trend of protectionism in the USA and the EU. It also focuses on impacts of protectionism on EastAsia in general and South Korea in particular.

Assessing the Impact of Technological Innovations and Trade Openness on Environmental Sustainability: An Empirical Study of South Asian Economies Using Panel ARDL Approach

This study examines the major factors that influence environmental sustainability over a 20-year period (2000–2020) in the four South Asian economies. In this study, two methods of estimation including the Pool Mean Group (PMG) estimator and the panel autoregressive distributed lag (ARDL) approach are used. The findings explore that trade openness, energy consumption, and economic expansion have a long-term positive and considerable impact on environmental deterioration, conversely technical innovation has a long-term negative impact on the environment. In short run scenario, trade openness and energy usage have significant and favourable effects on environmental degradation, whereas the economic growth and technological advancement have had a substantial negative influence on the environment. From this study, the policy makers provide the direction to the government by incentivizing technology, enforcing energy-efficient laws, promoting renewable energy, aligning trade policies with environmental goals, and enhancing regional cooperation. In order to improve South Asian environmental sustainable policies, future research should examine energy-trade-growth-technology by employing advanced techniques, and prioritizing innovation.

India–ASEAN Economic Relations and North-east India: Act East Policy as a New Paradigm

The article delves into three aspects: (a) India–ASEAN economic relationship since the last three decades of Look East Policy (LEP), (b) the achievements of North-east India (NEI) under LEP and Act East Policy (AEP) and (c) adding a note on AEP as a new ‘development paradigm’ in NEI. The study finds that the India–ASEAN economic relationship deepened in the post-LEP period as merchandise trade and foreign direct investment (FDI) inflows increased manifold. However, neither LEP nor AEP made any significant impact on NEI in terms of economic growth, exports and FDI inflows. Economic growth stagnated and even decelerated in some states in NEI, while exports and FDI inflows remained abysmally low. LEP was a failed policy instrument for NEI despite many claims and assumptions. The major reason was infrastructure deficits and poor connectivity in the region for a prolonged period. AEP has emerged as a new ‘development paradigm’ with renewed thrust on infrastructure buildup and connectivity constructions. The ongoing and completed connectivity projects in rail, road, air and water, improvement in power and telecom, multimodal logistic park in Assam and improvement of trade infrastructure in NEI under AEP would attract investment from both domestic foreign sources, enhance productive capacity, increase exports and accelerate economic growth. AEP is expected to open new possibilities for trade and investments in NEI through regional economic integration with South Asian and South-east Asian economies given geographical location, ethno-cultural proximity, historical linkages and resource endowments.

From bottlenecks to inflation: Impact of global supply-chain disruptions on inflation in select Asian economies

Supply-chain bottlenecks emerged alongside unprecedented inflationary surges amid the resulting mismatches in supply and demand for goods and services throughout the COVID-19 pandemic. This study employs a local projection approach to investigate the inflationary impact of global supply-chain pressures in the Philippines and select East Asian neighbors. We find that supply-chain disruptions are followed by sizable and statistically significant increases in headline inflation in the Philippines, Rep. of Korea, Thailand, and Singapore. Supply-chain shocks also have a considerable impact on the tradable segment of core inflation. Meanwhile, non-tradable inflation has a generally smaller, short-lived, and insignificant response to global supply-chain pressures reflecting the limited presence of second-round, indirect effects.

Jumping up the sanitation ladder in rural Cambodia: The role of remittances and peer-to-peer pressure in adopting high-quality latrines

Over the last 50 years, a combination of factors has driven sanitation improvements in rural areas of low-income and emerging economies in Asia. While open defecation remains an important challenge in many countries, Cambodia has rapidly increased rural sanitation coverage in the last 20 years. Using data collected via 92 interviews and seven focus group discussions, this qualitative study analysed the macro-level, community, and individual factors that motivated rural households to invest in high-quality latrines in seven villages in Cambodia that achieved and sustained open defecation free status with at least 85% latrine coverage. Local demand for adoption of high quality latrine was stimulated by a number of factors which include: a) NGO-led interventions that included behaviour change communication, sanitation marketing, and community-led total sanitation, all magnified by the strong support of local leaders at the village and commune levels; b) an increased proportion of rural households engaging in factory work, with access to raising wages, higher disposable incomes, and remittances; and c) subsidies and microcredit. Furthermore, migrants not only transferred financial resources to their home villages, but also transferred a set of ideas, norms, expectations, information, and behaviors back to their communities that reflect the migrants’ new ways of life, and economic possibilities. We provide evidence that new habits among factory workers, and ownership and display of new technologies and consumer commodities as symbols of modern success and social status facilitated high-quality latrine adoption. Peer-to-peer pressure at the village level, and among adult children commuting to factories or visiting their rural hometown ensured widespread adoption.

EXPLORE THE ROLES OF FEMALE ENTREPRENEURSHIP IN PROMOTING ECONOMIC GROWTH IN ASIA: A PANEL DATA ANALYSIS

In Asia, there has been a notable surge in the representation of women in leadership roles and entrepreneurial endeavours, aligning with the increasing acknowledgement of women's importance in politics and the economy. It is predicted that the future development and economic prosperity of Asia will heavily rely on the advancement of female entrepreneurship and empowerment. This research aims to provide empirical evidence on the correlation between female entrepreneurship and economic advancement within the diverse landscape of Asia context, using panel data spanning from 1998 to 2021 across 47 Asian countries. The findings of fixed-effect regression reveal a consistently positive association between women's entrepreneurial activities and economic progress across all Asian economies, encompassing both developed and developing nations. These findings are pivotal for crafting tailored policies aimed at enhancing female participation in entrepreneurship, thereby catalyzing economic growth and advancing towards the most potential in terms of socio-economic conditions.

Precarious Tightrope Between External Debt and Economic Growth: A Comparative Analysis of Bangladesh and Sri Lanka

In recent years, the foreign debt in South Asian economies has risen to concerning levels, suggesting that these governments are unable to generate enough revenues to finance their budget, which could most likely increase the risks of a debt crisis. This study looks at the relationship between foreign debt and the economic growth of two South Asian countries—Sri Lanka and Bangladesh—using Autoregressive Distributed Lag (ARDL) models from the period of 1984 to 2022. The comparative results demonstrate a persistent detrimental impact of foreign debt on both countries' economic growth trajectories. Moreover, our research emphasizes the importance of the debt-to-ԌDP ratio, suggesting that a higher percentage of external debt increases the adverse impact on ԌDP growth. The study compares the external debt levels of both countries and its consequences on their economies. Both Bangladesh and Sri Lanka suffer negative consequences from external debt. However, the study indicates that Sri Lanka, burdened with heavier debt, experiences a more pronounced impact on its economic growth trend as compared to Bangladesh. The study aims to address the pressing issue of rising foreign debt in South Asian economies, provide empirical evidence of its impact on economic growth, and offer policy recommendations. The findings have implications for both Sri Lanka and Bangladesh, emphasizing the importance of managing debt effectively.

Commodity markets and the global macroeconomy: evidence from machine learning and GVAR

Based on a strongly data-intensive machine learning approach, this study first identifies the most essential globally traded commodities in view of their role for the global macroeconomic performance. At the second stage we estimate a global vector autoregressive model to assess in more detail these global reactions. Our results from the first stage indicate that of the 55 analyzed commodity markets, only four are revealed as the most important. At the second step, our GVAR analysis indicates that the commodity market effects on macroeconomic activity are neither unanimous across the commodities nor across macrovariables. As an overall result, the commodity market exposure is clearly stronger among the advanced countries such as the euro area, other developed economies, and China, compared to the emerging economies of Africa, Asia, and Latin America, at both the country and regional levels. This puts a lot of pressure on economic policies aimed at reducing, e.g., the depriving effects of commodity market price development on aggregate economic performance of these countries.

Cryptocurrency and Macroeconomic Dynamics: Case of 10 Asian Economies

This research study investigates the impact of cryptocurrency on economic growth in 10 countries across Asia during past period 2013–2020. For this purpose, the sample included a range of economies with the highest number of Bitcoin usages or transactions. For this purpose, the sample included a range of economies with the highest number of Bitcoin usages or transactions, according to recent international rankings. With specific empirical means on panel data modelling, we attempted to show that economic growth, was influenced negatively by the cryptocurrency ‘Bitcoin’, and we concluded that this instrument leads to an increase in the inflation rate in a country according to the quantity theory of money and leads to a disorder in the monetary policy of a country. Our framework shows that the economic growth proxy was substantially influenced positively by economic indicators such as technology, investment and education but negatively by the high rate of participation, which caused an increase in unemployment. Our empirical results offer insights and insist on the importance of the intervention of the authorities to oversee and control the use of the cryptocurrency Bitcoin to avoid its negative effects and implement a strategy that overcomes these effects from a macroeconomic perspective. JEL Classification: E22, E24, E42, F43, E44, E52

Examining the seniority-based pay system in Korean companies: current trends and its implications for Asian economies

ABSTRACT Human resource management, including the design and implementation of pay systems, is influenced by the specific national context in which it operates. Challenges often arise when HRM practices that have been established in advanced countries are transplanted to developing nations, as they may not fully align with the unique circumstances and cultural dynamics of the target country. Until the 1980s, rapidly growing South Korean companies embraced the seniority-based pay system (SPS) in order to encourage employee tenure. The 1997 IMF foreign currency crisis led to an effort to shift away from this model, which was seen as unrelated to job roles and performance, towards alternative systems. Despite two decades of reforming efforts, SPS pay still prevails, particularly among production workers at large manufacturing companies under trade unions. The workplace panel survey data provides evidence that the implementation of a SPS system does not display any significant negative impact on firm performance, as measured through various methods. As such, the question is not whether to abolish the old system, but instead how to accommodate the new system. The study emphasizes aligning pay systems with the nation’s history, culture and industrialization rather than imposing foreign models.

Servicification in Global Value Chains in Emerging and Developing Asian Economies

Servicification in global value chains (GVCs) in emerging and developing Asian economies has become a trend recently. However, there have been no scientific studies to elucidate the mechanism of servicification in GVCs. To fill this gap, this study aims to investigate the involvement of service sectors in GVCs in Asian economies in terms of the quantitative interactions between service inputs and manufacturing exports and inputs and between service inputs and service exports. For this purpose, a panel vector-autoregressive model and the Trade in Value Added database of the Organization for Economic Cooperation and Development (OECD) were used for the empirical analysis during 1995–2018. The estimation results find that, first, there exist reciprocal interactions between the business services and manufacturing sectors; foreign business service inputs are induced by manufacturing exports, whereas manufacturing inputs are induced by business service exports. Second, foreign manufacturing inputs facilitate foreign business service inputs. Third, business service inputs are promoted by business service exports. These trends in the involvement of business services’ involvement in GVCs have accelerated since the mid-2000s. To enhance the role of services in GVCs, Asian economies should facilitate the removal of explicit restrictions in service trade and address regulatory divergence across countries.

Can board funds, bank credit, and economic development improve food production? Evidence from South Asia

PurposeThis study investigates the impact of board funds, banking credit, and economic development on food production in the context of South Asian economies (India, Pakistan, Bangladesh, Sri Lanka, and Nepal).Design/methodology/approachThis study used data from the World Development Indicators covering the years 1991–2019. To investigate the relationship between the variables of the study, we employed the panel unit root test, panel cointegration test, cross-sectional dependence test, fully modified least squares (FMOLS), and panel dynamic least squares (DOLS) estimators.FindingsThe empirical results indicate that board funding significantly increase food production; however, banking credit had a negative impact. Furthermore, the findings indicate that economic development, Arable land, fertilizer consumption, and agricultural employment play a leading role in enhancing food production. The results of the Dumitrescu-Hurlin causality test also show substantiated the significance of the causal relationship among all variables.Practical implicationsSouth Asian countries should prioritize board funding, bank credit, and economic development in their long-term strategies. Ensuring financial access for farmers through micro-credit and public bank initiatives can spur agricultural productivity and economic growth.Originality/valueThis study is the first to combine board funding, banking credit, and economic development to better comprehend their potential impact on food production. Instead of using traditional approaches, this study focuses on these financial and developmental aspects as critical determinants for increasing food production, using evidence from South Asia.