Growth In Asia Research Articles

Are Business Regulations Improving Economic Growth? Case Study between ASEAN and European Union

Economic activities require a transparent regulatory and policy environment that is accessible to all levels of society. This study aims to explain the impact of ease of doing business on economic growth in both ASEAN and the European Union since doing business indicators applied globally. Gross Domestic Product is used as a proxy variable for economic growth as Gross Domestic Product is an indicator to measure economic growth. This study uses a descriptive quantitative research model and uses multiple regressions to determine the effect of ease of doing business on economic growth in ASEAN and the European Union by comparing the result of each ASEAN and European Union. In this study it was found that in ASEAN, there are four indicators of doing business have significant impact to economic growth, while in the European Union five indicators have significant impact to economic growth.

Has Financial Integration of ASEAN and APEC Contributed to Economic Growth?

As globalization prevails, financial integration has been ongoing. The movement of globalization has occurred from the 1980s and a lot of attention has been paid to occurred issues from of aspects. This study focuses on whether financial integration in ASEAN and APEC promotes economic growth or not. These areas have attempted to tackle integration and cooperation and to achieve growth. Also, a global financial crisis occurred in the 1990s, and the 2000s made policy makers and business persons aware of potential contagion. Globalization sometimes has caused a contagion of financial crises. On the other hand, cooperation promoted recovery from the damaged economy in some areas. So the pros and cons have been examined, however, a definite answer whether financial integration is correct or not remains unknown. Using available data, empirical analyses are conducted in this study to examine the relationship between financial integration and economic growth. The empirical results show that financial integration has contributed to economic growth in ASEAN, however, this result cannot be applied clearly to APEC. The variety of participating countries in APEC may have affected the result. Moreover, there are some problems to be solved for sound economic growth for these areas.

Does board interlock control high-tech firm performance? Evidence from ASEAN's Growth Triangle Countries

The aim of this study is to explain the board interlock association on high-tech firm performance in three growth ASEAN countries. The research samples were 109 high-tech listed manufacturing firms, consisting of 38 Indonesian firms, 37 Malaysian firms, and 34 Thai firms in the 2015-2018 period. The study used panel regression analysis. The research found that corporate governance through interlock directorates is a determinant of high-tech firm performance. The low human capital with high-tech capabilities in ASEAN countries can be overcome by interlocking and facilitating companies to access strategic information. This study also found a positive association between director woman interlock and corporate performance. On the other hand, an independent director who does interlocking actually has a negative effect on company performance. This research is the first research on board interlock in high-tech firms in ASEAN growth countries, Indonesia, Malaysia, and Thailand. There is still limited research involving more than one country, especially developing countries, in studying the interlock board relationship on the company performance. The highlight of this study is to compare the effects of the three interlocks, interlocking directorate, woman interlock, and independent interlock, and their associations on the profitability of high-tech firms. Investors can have an in-depth understanding of the role of the type of interlock that affects the profitability and make the right decision in investing.

Foreign Direct Investment Spillovers and Economic Growth: Evidence from Asian Emerging Countries

Research on FDI in promoting economic growth has been the focus of recent decades, especially in developing countries. Foreign direct investment can be one of the main objectives in increasing economic growth. FDI is assumed to indirectly contribute to economic growth through a spillover effect on the absorption capacity of a country by increasing the stock of human capital and the quality of institutions. This study aims to analyze the spillover effect of FDI on economic growth in Asian emerging markets. The data were analyzed using dynamic panel regression (GMM) during 2008-2017 period with STATA 14 software.The results in this study strongly indicate that the spillovers of FDI is proven to be able to drive economic growth through human capital and institutions in Asian emerging markets.

Foreign Direct Investment Spillovers and Economic Growth: Evidence from Asian Emerging Countries

Research on FDI in promoting economic growth has been the focus of recent decades, especially in developing countries. Foreign direct investment can be one of the main objectives in increasing economic growth. FDI is assumed to indirectly contribute to economic growth through a spillover effect on the absorption capacity of a country by increasing the stock of human capital and the quality of institutions. This study aims to analyze the spillover effect of FDI on economic growth in Asian emerging markets. The data were analyzed using dynamic panel regression (GMM) during 2008-2017 period with STATA 14 software.The results in this study strongly indicate that the spillovers of FDI is proven to be able to drive economic growth through human capital and institutions in Asian emerging markets.

Explaining Asian growth paradox through interaction between informal and formal institutions

PurposeMuch of existing research has attempted to explain Asian Growth Paradox through formal institution – role of the government or rule of law. Therefore, this paper attempts to empirically explain the paradox with informal institution including interaction between informal and formal institutions. Two interrelated research questions summarize this research. First, how can we capture the relationship between informal and formal institutions? Then, how is that relationship different for Asian Paradox states vs non-paradox states?Design/methodology/approachTo capture the relationship between informal and formal institutions, we use Helmke and Levitsky (2004)'s framework to categorize the interaction as complementing, competing, substituting and accommodating. We perform cross-sectional regression analysis for more than 130 countries.FindingsWe find that the developed, developing and the Asian Paradox states display different patterns of interaction between informal and formal institutions. However, we also find that the interaction effect has a limited value explaining growth for most of these countries, suggesting that Helmke and Levitsky (2004)'s framework has limitations. Finally, we challenge the notion of Asian Paradox states, as countries outside of Asia also qualify as the Paradox states.Originality/valueNot much empirical effort has examined how different relationships between informal and formal institutions can explain growth internationally across countries. We show that different institutional patterns explain growth across the Paradox states and non-Paradox states.

The impact of natural resources and gross capital formation on economic growth in the context of globalization: evidence from developing countries on the continent of Europe, Asia, Africa, and America.

The aim of this paper is to investigate the nexus between natural resources, gross capital formation, globalization, and economic growth in the developing countries from European, Asian, African, and American continents. It adopted the panel vector autoregression (PVAR) approach to test this relationship for the period from 1980 to 2018. Results suggest that natural resources and globalization have a positive impact on economic growth in European, Asian, and American countries, while capital formation negatively affects growth. In African countries, the effect of globalization and gross capital formation is positive, but natural resources have a negative impact on GDP. Evidence from all continents illustrate that there is bidirectional causality between globalization and economic growth. Also, there is bidirectional causality detected between capital formation and growth in Europe and Asia and between natural resources and growth in Asia and America, while there is unidirectional causality from GDP to natural resources in Europe, from capital formation to GDP in Africa and America, from GDP to natural resources in Europe, and from natural resources to GDP in America. Based on these results, it can be said that new growth models can no longer be independent of natural resource rents and globalization.

Role of capital investment, investment risks, and globalization in economic growth

AbstractThe study investigates the role of public and private capital investment and globalization in the economic growth of 34 Asian economies along with investment risk and demographic pressure. By applying the two‐step system generalized method of moment, results show that private capital investment in Asian emerging‐economies has been a substantial positive impact on regional economic growth and is significantly influenced by low‐investment risks and demographic conditions as compared to low‐income and advance‐economies from 2001 to 2019. It further states that economic globalization accelerates the economic growth in Asian emerging, developing, and low‐income economies compared to advanced‐economies. This study contributes to the existing literature by analyzing Asian economies in two ways (separately public and private investment and economic globalization index to economic growth), which has been scarce in this regard. The study also suggests that private capital investment should be backed with low‐risk investment policies that create more private investment, enhance the institutional capacity, productivity, and attract foreign investors. This study's findings highlight that, for the development of the economies, private‐investment inclusion with public‐investment is the backbone that can accelerate economic growth by controlling external pressures and business risk in the country with effective public policies.

EXAMINING THE RELATIONSHIP BETWEEN ELECTRICITY CONSUMPTION, FINANCIAL DEVELOPMENT AND ECONOMIC GROWTH IN ASEAN COUNTRIES: EVIDENCE FROM A BAYESIAN ANALYSIS

The literature has suggested that financial development and electricity consumption are key determinants of economic growth. However, existing studies usually was applied the frequentist inference, which is an outdated estimator. By applying the Bayesian approach via the Metropolis-Hasting and Gibbs samplers as the MCMC methods, the study aims to re-examine the impact of financial development and electricity consumption on economic growth in ASEAN+6 countries from 1980 to 2016. The obtained outcome shows that the impact of both financial development and electricity consumption is strong and positive on economic growth. There is a uni-directional causality running from economic growth to energy consumption, supported the Conversation hypothesis. Based on the empirical result, several policy implications are suggested for emerging countries, ASEAN+6 nations, in particular.Keywords: Financial development; Energy consumption; Economic growth; Bayesian; ASEAN countries.JEL Classifications: F43, O13, O47, Q42, Q43.DOI: https://doi.org/10.32479/ijeep.10642

Fiscal Causal Hypotheses and Panel Cointegration Analysis for Sustainable Economic Growth in ASEAN

Fiscal Causal Hypotheses and Panel Cointegration Analysis for Sustainable Economic Growth in ASEAN

Manufacturing Revolutions: Industrial Policy and Industrialization in South Korea

I study the impact of industrial policy on industrial development by considering a canonical intervention. Following a political crisis, South Korea dramatically altered its development strategy with a sector-specific industrial policy: the Heavy and Chemical Industry (HCI) drive, 1973-1979. With newly assembled data, I use the sharp introduction and withdrawal of industrial policies to study the impacts of industrial policy---during and after the intervention period. I show (1) HCI promoted the expansion and dynamic comparative advantage of directly targeted industries. (2) Using variation in exposure to policies through the input-output network, I show HCI indirectly benefited downstream users of targeted intermediates. (3) I find direct and indirect benefits of HCI persisted even after the end of HCI, following the 1979 assassination of the president. These effects include the eventual development of directly targeted exporters and their downstream counterparts. Together, my findings suggest that the temporary drive shifted Korean manufacturing into more advanced markets and created durable industrial change. These findings clarify lessons drawn from South Korea and the East Asian growth miracle.

Analysis of Connectivity and Mobility Changes for Mainliner Air Traffic on a Global Scale

When it comes to international mobility, air connections are crucial for transporting passengers over long distances in the fastest possible way. This paper provides an analysis with focus on the investigation of connectivity and mobility changes in relation to mainliner air traffic considering the 200 cities with the largest GDP per capita on global scale. Following the results of previous studies that have shown a linkage between air connectivity and GDP development, this analysis examines flight schedule data from 2000 and 2019. From these findings, non-, one- and two-stop connections originating from the airports located in the surrounding area of the 200 cities considered were analyzed. Connectivity between the 200 cities with largest GDP per capita on global scale has increased by about 20% considering non-stop and about 6% considering one-stop connections. Growth of the connections of the cities under consideration mainly affected Europe as well as North America with East Asia. Geographical location and the range of aircraft types play a role in the possibility of direct connections. European cities are well connected, and only the frequency of connections has increased noticeably between 2000 and 2019. The use of small air transport could further increase connectivity. Based on the East Asian growth figures of the past years, a trend for the future can be derived, according to which increasing demand on routes to Europe and North America will increase the need for long-haul aircraft to serve demand through direct flights.

DEMOGRAPHIC CHANGE AND PERCEPTIONS OF RACISM

AbstractVarious research has demonstrated that rapid racial demographic change may aid in triggering various forms of backlash under certain conditions. This has led scholars to speak of Whites “defending” their local environment in the face of eroding racial dominance. However, little research has addressed how perceptions of racism among minorities may be triggered under conditions of demographic change. This study attempts to fill this gap in the literature by examining the relationship between racial demographic change for Blacks, Hispanics, and Asians and perceptions of racial problems among these groups in the United States. Using standard OLS regressions, ordered logistic regressions, multinomial logistic regressions, and techniques accounting for selection into treatment, I find that Blacks and Hispanics living in counties undergoing rapid growth of Black and Hispanic populations, respectively, have higher perceptions of racial problems. Asians show no evidence of increased perceptions of racial problems in counties undergoing rapid Asian growth. For Blacks, this relationship is concentrated among those without at least a four-year degree and residents of counties with lower initial White populations (and higher initial Black populations). For Hispanics, it is similarly concentrated among those without at least a four-year degree, but also is likely stronger among residents of counties with higher initial White populations (and lower initial Hispanic populations), highlighting unique racial dynamics. This research adds to a growing body of work showing the importance of examining demographic change at the local level in order to understand some of today’s most pressing political and social issues.

South Korea's New Southern Policy as an Open Regime: A View from Southeast Asia

There are four ways on how the NSP Plus could be further improved. First, to avoid policy limitations and maximize the room for supply chain resiliency and functional cooperation, the coverage of the NSP countries can be expanded apart from ASEAN and India. Second, South Korea can employ the concept of Third-Party Market Cooperation (TPMC) or the pursuit of joint ventures or partnerships with other countries in maximizing capacity-building in third countries (NSP countries). Third, South Korea can help strengthen ASEAN institution-building, regionalism and internal balancing by applying a similar policy framework to the Brunei-Indonesia-Malaysia-Philippines East ASEAN Growth Area (BIMP-EAGA) just as it does to the Mekong Region. Fourth, there needs to be more reciprocity or two-way interaction in the NSP so as to not make it seem that ASEAN is only on the receiving end of South Korean generosity. Finally, it is important to note that a change in the South Korean administration does not necessarily spell the end of the NSP just as the US’ Pivot or Rebalance to Asia of the Obama Administration was remodeled to the Indo-Pacific under the Trump administration.

The Effect of Gender Unemployment on Economic Growth: A Panel Data Analysis

Objective – Prior to the East ASEAN Growth Area (EAGA) in ASEAN, Brunei, Indonesia, Malaysia, and the Philippines (BIMP) took in an inflow of immigrants to support growth. The more they depended on foreign labour, the issue of gender inequality in the job sector became an issue that is hindering prosperity. Methodology/Technique – The research was aimed to identify the relation between unemployment rate from the gender perspective and economic growth of BIMP-EAGA by using two methods, namely Fully Modified Ordinary Least Square (FMOLS) and Dynamic Ordinary Least Square (DOLS). Annual time series data for the period of 1990 to 2018 was employed. Findings & Novelty – The result was contrary to Okun's law which says that there is a negative relation between the male unemployment rate and GDP. This study found that the female unemployment rate did not affect GDP and was insignificant. Policies that benefit and increase the participation of female workers in the job sector should be enhanced to prepare a conducive environment for the economy. Type of Paper: Empirical. JEL Classification: E24, J16. Keywords: Labour Force, Gender, Economic Growth, BIMP Reference to this paper should be made as follows: Taasim, S; Daud, A. 2020. The Effect of Gender Unemployment on Economic Growth: A Panel Data Analysis, J. Bus. Econ. Review, 5(3) 94–103 https://doi.org/10.35609/jber.2020.5.3(3)

THE AFTERMATH OF UNSUSTAINABLE URBANIZATION IN SOUTH EAST ASIA COUNTRIES

Urbanization refer as a process of people migrating from rural to urban areas. the process of urbanization in Southeast Asian countries arises due to industrialization and globalization of economic activities. Urbanization provides many job opportunities and consequently invites many rural migrants. The continuous growth of Asean's urban population will endlessly put burden on its sustainability. Combined with the impacts of climate change, these stresses may lead to an unsustainable future for ASEAN cities. A content analysis was also performed to recognize three specific issues related to unsustainable urbanization in South East Asian countries namely housing, health and waste management. The finding of the study discovered that there is a room for expansion in the process of urbanization. The government ought to modernize agriculture, expand agricultural productivity, accelerate infrastructure building in the rural areas, and recognize the integrated development of urban and rural areas

Financial Development, Economic Growth, and Environmental Degradation Nexus in ASIAN Emerging Markets

Environmental degradation is one of the major problems in the world recently and one of the United Nations’ (UN) sustainable development goals (SDGs). Emerging markets countries that have become major players in the global economy and the main source of world economic growth have great potential to contribute the environmental degradation due to increased economic activities. This paper investigates the impact of financial development and economic growth on environmental degradation in Asian emerging markets. A panel environmental degradation model using financial development from banking sector and capital market sector, economic growth, Foreign Direct Investment (FDI), and urbanization variables that are major determinants of CO2 emission as a proxy of environmental degradation. The periods considered were 1980 – 2018 for banking model, and 1996 – 2018 for financial sector model (banking sector and capital market sector). A panel data approach applied such as cross-section dependence, panel unit root, panel cointegration, Fully Modified OLS (FMOLS) and Dynamic Ordinary Least Square (DOLS). The empirical finding revealed that in Asian emerging markets there is positively long-term relationship between financial development from banking model with environmental degradation. Nevertheless, we do not find any long-term relationship between financial development from financial sector model with environmental degradation. Moreover, the quadratic negative signed for economic growth showed the existence of Environmental Kuznets Curve (EKC).

The Impact of Public Debt on Economic Growth of ASEAN + 3 Countries

Purpose: The study applied the threshold regression method proposed by Hansen (1999) with panel data (Panel Threshold Regression-PTR) to determine the existence of threshold effects and threshold values of public debt affecting the economic growth of ASEAN+3 countries. Design/Methodology/Approach: The model of the impact of public debt on economic growth was developed by the authors based on the study by Egert (2015) and conducted by the authors using three samples, including all countries, high-income countries, and middle-income countries for the period 2004-2015. Findings: The study results showed that, with the sample of all ASEAN + 3 countries, two public debt thresholds on GDP were 26.96% and 72.53%. With a sample of high-income countries, one public debt threshold on GDP was 65.80%. For the sample of middle-income countries, two public debt thresholds on GDP were 26.96% and 72.53%. More specifically, for middle-income countries, at public debt levels below 26.96% of GDP and from 72.53% of GDP, public debt will have a negative and statistically significant impact on economic growth. At public debt levels ranging from 26.96% of GDP to 72.53% of GDP, public debt does not affect economic growth, but these levels promote public expenditure that positively affects economic growth. Practical implications: Based on the research results, policymakers can use these thresholds in managing national public debt. Originality/Value: Although this study organically builds upon recent studies about public debt and economic growth, it provides a new method to determine the effect of public debt on economic growth using the threshold regression method proposed by Hansen (1999) with panel data (Panel Threshold Regression-PTR).

Japan's digital advance policy towards performance in multilateral ASEAN's innovation business

This paper examines issues relating to Japan’s digital advance policy (DAP) for ASEAN countries during the period 2015 - 2019, which aimed at broadening the spectrum of digital economic growth. The study sought to gain insights into the impacts of respective policies of ASEAN, Japan Council for Science, Technology and Innovation (CSTI), Japanese digital foreign direct investment (FDI), and Japanese enterprises. The study also examined workflow structure processes to explain how Japan’s DAP contributes to ASEAN’s innovation business. This research is categorized as a reconnaissance study, based on empirical analysis of pertinent existing evidence, complemented by 74 in-depth interviews with key experts from ASEAN, JICA, CSTI and major digital enterprises from 5 ASEAN countries. The findings indicate a need to redirect the innovation business of Japan's DAP as well as ASEAN’s innovation business and to enhance their mutual alignment. Four key entry points are proposed: (1) policymakers, (2) private sector businesses, (3) goalkeeper science, and (4) innovative infrastructure. This paper also provides guidelines and support to validate key performance indicators of Japan's DAP in ASEAN countries. The studies how Japan’s digital holistic platforms could be transferred to ASEAN countries under the DAP. It also examines the relationship between key performance indicators of Japan’s outward FDI in ASEAN digital businesses and growth in ASEAN’s innovation business.

Neoconservatives and Neo-Confucians: East Asian Growth and the Celebration of Tradition

This article explores the influence of East Asia's economic growth on the evolution of American neoconservative thought in the 1970s and 1980s. It traces how prominent neoconservative thinkers—Nathan Glazer, Peter L. Berger, Herman Kahn, Michael Novak, and Lawrence E. Harrison—developed the claim that the region's prosperity stemmed from its alleged Confucian tradition. Drawing in part from East Asian leaders and scholars, they argued that the region's growth demonstrated that tradition had facilitated, rather than hampered, the development of a distinct East Asian capitalist modernity. The article argues that this Confucian thesis helped American neoconservatives articulate their conviction that “natural” social hierarchies, religious commitment, and traditional families were necessary for healthy and free capitalist societies. It then charts how neoconservatives mobilized this interpretation of Confucian East Asia against postcolonial critiques of capitalism, especially dependency theory. East Asia, they claimed, demonstrated that poverty and wealth were determined not by patterns of welfare, structural exploitation, or foreign assistance, but values and culture. The concept of Confucian capitalism, the article shows, was central to neoconservatives’ broad ideological agenda of protecting political, economic, and racial inequality under the guise of values, culture, and tradition.