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Regional Papers on Asia Pacific



Why Maddison was Wrong Why Maddison was Wrong: The Great Divergence Between Imperial China and the West
Kent Deng & Patrick O'Brien, World Economics, June 2017
Much academic debate in Western and Chinese universities has engaged in testing the hypothesis that standards of living in China did not fall behind those of the populations of the national economies of Western Europe until late in the eighteenth century Unfortunately, ... More


Measuring the Success of Industrial Policy in Australia Measuring the Success of Industrial Policy in Australia
Andrew Marks, World Economics, December 2016
Industry policy in the context of trade liberalization has played a critical reinforcing role in re-orienting production in the Australian manufacturing sector from the domestic to international market. In the textile, clothing, footwear and motor vehicle industries thi ... More


The Creation of the Asian Infrastructure and Investment Bank: America’s Loss and China’s Gain The Creation of the Asian Infrastructure and Investment Bank: America’s Loss and China’s Gain
Stuart P.M. Mackintosh, World Economics, September 2016
The Global Financial Crisis (GFC) pulled institutions together diplomatically and economically. It clarified options and failures of the past and hastened coordinated reforms. But the GFC also starkly illuminated another geopolitical dynamic: Deals struck in extremis mu ... More


Japan’s Monetary Policy Misadventure Japan’s Monetary Policy Misadventure
Masanaga Kumakura, World Economics, June 2016
This paper argues that the Bank of Japan’s decision in April 2013 to formally adopt inflation targeting as the framework of its monetary policy and to embark on a programme of quantitative and qualitative monetary easing was misconceived. The aim of the policy to achiev ... More


China’s GDP Per Capita from the Han Dynasty to Communist Times China’s GDP Per Capita from the Han Dynasty to Communist Times
Kent Deng & Patrick O'Brien, World Economics, June 2016
This article is a critical survey of the concepts and data utilized by economists and economic historians that purport to measure relative levels and long term trends in GDP per capita from the Han Dynasty to Communist times. We favour attempts to extend macro-economic ... More


How Fast Will China Grow Towards 2030 How Fast Will China Grow Towards 2030: And what about the US?
Jorgen Randers, World Economics, June 2016
Historical data for the last fifty years shows that there is a surprisingly strong correlation between the growth rate of a nation’s GDP per person and its income level. The growth rate declines linearly with income, and this relationship can be used to estimate the fut ... More


Youth Employment Crisis in India Youth Employment Crisis in India
Swati Dutta, World Economics, March 2016
The global financial crisis and the subsequent uneven recovery have underscored the need for Africa’s resilience to output and other shocks originated in the rest of the world. A comparison of two regional economic communities – the East African Community (EAC) and the ... More


The Indian Economy: From Growth to Stagflation to Liberal Reform The Indian Economy: From Growth to Stagflation to Liberal Reform
Deepak Lal , World Economics, March 2016
This paper considers the optimistic scenario that India was on a high growth path and would follow China’s path with a lag (as its reforms started in 1991 compared with China’s in 1980) which would produce an economic miracle. This did not happen and since 2011 India’s ... More


Dissecting China’s Property Market Data Dissecting China’s Property Market Data
Meiping (Aggie) Sun, World Economics, March 2016
This paper analyses Chinese property market data to evaluate recent trends in the market and to make prognoses for the future. It considers whether or not the existence of high prices and at the same time an enormous rise in residential supply in terms of floor space un ... More


Data on Singapore’s Sovereign Wealth Fund is Flawed Data on Singapore’s Sovereign Wealth Fund is Flawed
Christopher Balding, World Economics, September 2015
This paper undertakes a critique of the quality of Singapore’s public economic data in the context of the claim that one of the island’s sovereign wealth funds, Temasek Holdings, reports that it has earned since inception in 1974 an average annualized rate of return of ... More


Inflation Targeting in Developing Countries Inflation Targeting in Developing Countries
Anthony Gathogo & Wook Sohn, World Economics, June 2015
This paper analyzes economic and institutional factors that affect the likelihood of adopting an inflation-targeting monetary policy regime in emerging markets and developing countries. We use a logit model for a sample that comprises both inflation-targeting and non-ta ... More


Deflation? What Deflation? Statistical Origins of Japan’s Declining Price Levels Deflation? What Deflation? Statistical Origins of Japan’s Declining Price Levels
Masanaga Kumakura, World Economics, June 2015
Although Japan’s CPI is often criticized for potential upward bias, it deals with improvements in the quality of individual goods in ways that make the statistical inflation rate much lower than actual price changes. Moreover, the quantitative importance of this effect ... More


How Wealthy are the Chinese? How Wealthy are the Chinese?
Scott MacDonald, World Economics, December 2014
This paper looks at the available data about the number of high and ultra-high net worth individuals in China in order to assess the potential for Family Offices in the country. It also considers the possible investment preferences of the Chinese outside China as extern ... More


The Greek Economic Crisis - is the Euro to Blame? The Greek Economic Crisis - is the Euro to Blame?
Andreas Hatzigeorgiou, World Economics, September 2014
The euro has been at the centre of reporting and discussion on Greece’s economic crisis. This article analyses the build-up, outbreak and development of the crisis in Greece, with the aim to answer whether the crisis can be traced to the country’s entrance into the Euro ... More


Measuring the Asia-Pacific Region Measuring the Asia-Pacific Region
Brian Sturgess, World Economics, September 2014
The Asia-Pacific region covers the countries around the Pacific Rim, South East Asia, the Indian Sub-Continent and Oceania. It contains three of the world’s largest economies outside the US: China, India and Japan. The quality of economic statistics varies widely across ... More


Why India is Vulnerable to Portfolio Investment Movements Why India is Vulnerable to Portfolio Investment Movements: Analysis of capital flows between India and the United States
Mandira Sarma, World Economics, December 2013
This paper analyses the trend of capital flows between India and the US during 2000–2012. The US is a major source of foreign capital in India, through both direct and portfolio investment. During this period, portfolio investment from the US to India dominated over dir ... More


Human Resource Development (HRD) and Foreign Remittances Human Resource Development (HRD) and Foreign Remittances: The case of South Asia
Muhammad Abdul Wahab, Vaqar Ahmed & Hamid Mahmood, World Economics, December 2013
This study tries to document linkages between HRD, migration and remittances in South Asia. We have explained in detail the various channels through which HRD promotes migration and remittances, and a case has been made not to consider this process as brain drain – rath ... More


Asset Poverty in India Asset Poverty in India
Swati Dutta, World Economics, September 2013
In order to formulate policy to target the correctly identified rural poor in India, focus on an income poverty measure alone is insufficient. The purpose of this research is to study a new area of poverty measurement based on data that detail a household’s access to ba ... More


From Stellar Growth to Underperformance From Stellar Growth to Underperformance: The Abiding Vulnerability of the Indian Economy
Dilip K. Das, World Economics, September 2013
The economic trajectory of the Indian economy has altered several times. After decades of severe underperformance, the Indian economy gradually picked up momentum in the 1980s and 1990s, and turned in a stellar performance during the 2000s. This paper examines the ratio ... More


Cross-Border Financial Integration in Asia and the Macro-Financial Policy Framework Cross-Border Financial Integration in Asia and the Macro-Financial Policy Framework
Philip R. Lane, World Economics, June 2013
In relative terms, Asia came through the global financial crisis relatively well. In part, this can be attributed to its conservative approach to international financial integration. At the same time, financial globalisation means that Asia cannot be fully insulated fro ... More


How Safe is SAFE’s Management of China’s Official Foreign Exchange Reserves? How Safe is SAFE’s Management of China’s Official Foreign Exchange Reserves?
Friedrich Wu, Robbert-Jan Korthals & Ng Kuan Khai, World Economics, June 2013
This paper examines whether the State Administration of Foreign Exchange (SAFE) and its subsidiary SAFE Investment Company (SIC), the sole managers of China’s gargantuan official foreign exchange reserves (OFER) until 2007, have shifted their investment behaviour since ... More


Poor Economic Statistics Fuel China’s Low Consumption Myth Poor Economic Statistics Fuel China’s Low Consumption Myth
Jun Zhang & Tian Zhu, World Economics, June 2013
The generally held belief that China’s consumption is too low is a myth based on inadequate theory, a misreading of official statistics and the use of market exchange rates for making international comparisons. Chinese official statistics underestimate consumption expen ... More


Industrial Rebalancing is Already Here, But Can it Continue? Industrial Rebalancing is Already Here, But Can it Continue?
Nate Taplin, World Economics, June 2013
In mid-2012, as China’s economy decelerated, growth in electricity production – traditionally a good proxy for the health of industry – diverged strongly on the downside from official measures of industrial value added. While many analysts interpreted this incongruence ... More


Averting a Global Food Crisis Averting a Global Food Crisis: Policy and data needs
Keith Boyfield, World Economics, March 2013
The World Bank’s Food Price Watch reached a new historic peak in August 2012. High and volatile food prices spell real hardship for the world’s poor, and supply problems due to volatile climatic conditions have exacerbated the surge in global food prices. Investment in ... More


Communist China’s Capitalism Communist China’s Capitalism: The highest stage of capitalist imperialism
Kenneth Austin, World Economics, March 2011
This article explains the contemporary Chinese–American economic relationship as an ironic variant of the classical theory of capitalist imperialism. Communist China is the modern world’s great imperial power (exporter of surplus savings). China exports its savings by u ... More


Recent Developments on the Rare Earth Front Recent Developments on the Rare Earth Front: Evidence of a new technocratic mercantilism emerging in China?
Robert Looney, World Economics, March 2011
Chinese actions in the rare earths market have raised a number of concerns about the country’s motives in restricting exports. One theory is that the country simply wants to ensure that it has adequate supplies for its future expansion into a number of energyefficient, ... More


On Economic Growth and Domestic Saving in India On Economic Growth and Domestic Saving in India
Tarlok Singh, World Economics, March 2011
This study examines the economic growth and domestic saving in India. The onset of gradual economic reforms since the 1980s provided some fillip to growth, and the momentum was carried forward through the adoption of a wide-ranging structural adjustment program since th ... More


Why is the Chinese Saving Rate so High? Why is the Chinese Saving Rate so High?
Guonan Ma & Wang Yi, World Economics, March 2011
China’s saving rate is high from many perspectives – historical experience, international standards and model predictions. Furthermore, the average saving rate has been rising over time, with much of the increase taking place in the 2000s. What sets China apart from the ... More


A Rising Consumer Class A Rising Consumer Class: A perspective on India
Manish Sonthalia, World Economics, December 2010
India has had two stages of growth, both related to consumption since 1947. The first was based on developing economic self sufficiency; the second on rising disposable income. It is now entering its third period of consumption growth which sees it entering the world st ... More


Vietnam: From Transitional State to Asian Tiger? Vietnam: From Transitional State to Asian Tiger?: Issues of the Vietnamese economic transformation experience
F. Gerard Adams & Anh Le Tran, World Economics, June 2010
Putting aside the legacy of its unique history, Vietnam has achieved an excellent growth record. But it is still far behind the leading East Asian economies. We consider the Vietnamese growth strategy in light of the controversies about ‘accumulation vs assimilation’ an ... More


Maddison and Wu: ‘Measuring China’s Economic Performance’ Maddison and Wu: ‘Measuring China’s Economic Performance’
Yuri Dikhanov & Eric V. Swanson, World Economics, March 2010
Angus Maddison and Harry Wu (2008) claim that, in 2003, China’s GDP was 73% of that of the United States on a purchasing power parity (PPP) basis. Rejecting the results of the 2005 International Comparison Program (ICP), they construct their own PPP using a 1986 GDP est ... More


The Chinese Renminbi (Yuan) The Chinese Renminbi (Yuan): A new global currency in the making?
Friedrich Wu, Pan Rongfang & Wang Di, World Economics, March 2010
This paper is a tentative endeavour to delineate the potential of the renminbi to become a global currency. It first analyses the critical economic, financial and policy attributes that are required to support a currency to gain an international role. It then examines w ... More


Well-being and Public Attitudes in Afghanistan Well-being and Public Attitudes in Afghanistan: Some insights from the economics of happiness
Carol Graham & Soumya Chattopadhyay, World Economics, September 2009
Afghanistan is a context where individuals have to cope with the most adverse of circumstances. Our study of happiness finds that Afghans conform to a remarkably consistent worldwide pattern in the determinants of happiness across individuals within countries of all dif ... More


Are Economic Sanctions Useful in Discouraging the Proliferation of Weapons of Mass Destruction? Are Economic Sanctions Useful in Discouraging the Proliferation of Weapons of Mass Destruction?
Robert Carbaugh, World Economics, December 2008
against countries that have been implicated in the development of weapons of mass destruction and the use of terrorism. These sanctions have included limitations on customary trade and/or financial relations with a target country. Are sanctions effective in discourag ... More


How can Korea Raise its Future Potential Growth Rate? How can Korea Raise its Future Potential Growth Rate?
Elena Ianchovichina & Danny Leipziger, World Economics, December 2008
Korea has achieved tremendous economic progress over the last three and a half decades, but in recent years growth has slowed down, and looking forward, most forecasters expect potential growth to decline substantially. The authors’ analysis of the key factors determ ... More


Trends and Challenges in Islamic Finance Trends and Challenges in Islamic Finance
Heiko Hesse, Andreas (Andy) Jobst & Juan Solé, World Economics, June 2008
The paper first discusses the current trends in Islamic finance, which has become mainstream with currently more than US$800 billion of assets worldwide and a buoyant market for sukuk bonds. However, this exorbitant growth raises many challenges, particularly in the are ... More


The Rise of China Investment Corporation The Rise of China Investment Corporation: A new member of the sovereign wealth club
Friedrich Wu & Arifin Seah, World Economics, June 2008
The sovereign wealth club acquired a new member with the official launch of the China Investment Corporation (CIC) on 29 September 2007. The arrival of CIC has further heated up the debate on sovereign wealth funds (SWFs) and their potential implications for global fina ... More


Measuring China’s Economic Performance Measuring China’s Economic Performance
Andreas (Andy) Jobst & Harry X. Wu, World Economics, June 2008
China is the world’s fastest growing economy and is also the second largest. However, the official estimates of the Chinese National Bureau of Statistics exaggerate GDP growth and need adjustment to conform to international norms as set out in the 1993 System of Nationa ... More


Islamic Economics and Finance Islamic Economics and Finance
Rodney Wilson, World Economics, March 2008
This article provides an introduction to key concepts and methods involved in an Islamic approach to business, investment, risk taking and insurance. The prohibition of riba (interest or usury) profoundly influences the way business transactions and investments a ... More


Growth Strategies and Dynamics Growth Strategies and Dynamics: Insights from country experiences
Mohamed A. El-Erian & A. Michael Spence, World Economics, March 2008
The paper examines the challenges that developing countries face in accelerating and sustaining growth. The cases of China and India are examined to illustrate a more general phenomenon which might be called model uncertainty. As a developing economy grows, its market a ... More


The Future of North Korea is South Korea The Future of North Korea is South Korea: (Or hope springs eternal)
Marcus Noland, World Economics, September 2007
North Korea's famine was in significant part a product of state failure, and unleashed an unintended grassroots process of marketization. Reforms undertaken in 2002 are more usefully interpreted as a response to this development than as a pro-active attempt to improve e ... More


A Dynamic Theory of China–U.S. Trade A Dynamic Theory of China–U.S. Trade: Making sense of the imbalances
Amar Bhidé & Edmund Phelps, World Economics, September 2007
China's trade surplus with the U.S. is now more than a quarter of the U.S. trade deficit and, with China growing faster than the U.S., raises questions about its future course. Some media commentators term the chronic trade surplus "mercantilist" but offer no persuasive ... More


Does China Still Need Hong Kong? Does China Still Need Hong Kong?
Friedrich Wu, World Economics, June 2007
As the Hong Kong Special Administrative Region reaches the 10th anniversary of the territory’s reunion with its sovereign in China this year, it faces several looming competitive challenges from its ambitious and aggressive “sister” cities on the mainland. Going forward ... More


Can China Learn from Sweden? Can China Learn from Sweden?
Arne Bigsten, World Economics, June 2007
China is undergoing a very rapid process of structural and institutional transformation, which has led to dramatic increases in income levels. During this process, the country is facing a series of development challenges that need to be dealt with in order to sustain gr ... More


The Emergence of a Regional Financial Architecture in Asia The Emergence of a Regional Financial Architecture in Asia: Recent developments and prospects
Anthony Elson, World Economics, September 2006
This paper provides an assessment of monetary and financial cooperation in Asia since the regional financial crisis of 1997–98, with a view to determining whether the emerging Regional Financial Architecture in Asia is compatible with the global financial architecture a ... More


What Could Brake China’s Rapid Ascent in the World Economy? What Could Brake China’s Rapid Ascent in the World Economy?
Friedrich Wu, World Economics, September 2006
There has been much hype about China’s rapid ascent in the world economy. For instance, economists from Goldman Sachs and the OECD have predicted that the Chinese economy will overtake the Japanese and the US economies well before the mid–21st century. However, these op ... More


Understanding China’s Economic Transformation Understanding China’s Economic Transformation: Are there lessons here for the developing world?
Daniel W. Bromley & Yang Yao, World Economics, June 2006
Economic change is a process of continual adjustment to new circumstances. Economies are always in the process of becoming. Good economic policy entails pragmatic adjustment so that economic dystrophy is avoided. The experience of economic (institutional) reform in Chin ... More


Corporate China Goes Global Corporate China Goes Global
Friedrich Wu, World Economics, December 2005
Recent high-profile international acquisitions and take-over bids by Chinese companies have attracted much media limelight and raised intense interest in China’s rising outward foreign direct investment (FDI). This paper delineates the macro trends of China’s outward FD ... More


Reserve Accumulation in Asia Reserve Accumulation in Asia: Lessons for holistic reform of the international monetary system
Graham Bird & Alex Mandilaras, World Economics, March 2005
In the aftermath of the 1997/1998 crisis, Asian economies have built up large holdings of international reserves. Although initially encouraged to do so by the IMF, more recently they have been criticised for maintaining undervalued currencies, running large current ... More


Trade in the Chinese 21st Century Trade in the Chinese 21st Century
Howard Davies, World Economics, March 2005
In this article Sir Howard Davies, Director of the London School of Economics and Political Science, offers some thoughts, first, on the political framework within which trade policy is determined, then about the way in which the globalization debate has developed, a ... More


Governance Matters Governance Matters: The role of governance in Asian economic development
David E. Bloom, David Steven & Mark Weston, World Economics, December 2004
In recent years there has been a surge of interest in governance: good governance increasingly is seen as a vital adjunct to successful development efforts. This paper attempts to explain what governance is and why it is important, and assess which forms of governanc ... More


Asian Drama Asian Drama: The pursuit of modernisation in India and Indonesia
Tim Lankester, World Economics, September 2004
The now largely forgotten book Asian Drama: An Inquiry into the Poverty of Nations by Swedish social scientist Gunnar Myrdal was published in 1968. Myrdal called his book “Asian Drama” because of the tensions he saw being played out in Asia between modern idea ... More


Globalisation and the Asia–Pacific Revival Globalisation and the Asia–Pacific Revival
Arne Bigsten, World Economics, June 2004
This paper reviews evidence on the evolution of international economic integration of Asia–Pacific countries, and discusses the extent to which this explains their recent growth success. It starts with a review of some theoretical arguments in the growth and globalis ... More


The Quest for Development The Quest for Development: What role does history play?
Areendam Chanda & Louis Putterman, World Economics, June 2004
It may be no coincidence that those countries that grew most rapidly in the late twentieth century—including South Korea, China, and, of late, India—were relatively developed civilizations when Western Europe began its overseas expansion five centuries ago. In this a ... More


China’s Capital Market China’s Capital Market: Better than a casino
Stephen Green, World Economics, December 2003
Throughout the 1990s, China’s stock market was developed as a tool of industrial policy. It was used to supply capital to state-owned enterprises (SOEs) that remained controlled by the state and whose performance usually declined after listing. Secondary market tradi ... More


Exchange Rate Regimes Exchange Rate Regimes: Is there a third way?
Vijay Joshi, World Economics, December 2003
This paper argues that (a) for many developing countries, the optimal external payments regime would be a combination of an intermediate exchange rate with capital controls and (b) the policy stance and advice of the IMF should reflect this judgement. The paper uses ... More


Hydropower in Bhutan and Nepal Hydropower in Bhutan and Nepal: Why the difference?
Jeremy Berkoff, World Economics, September 2003
Bhutan and Nepal have followed differing hydropower development strategies. Bhutan has co-operated with India and power export earnings have helped fund a broadly successful economic, environmental and social programme. In contrast, Nepal turned to the World Bank and ... More


A Decade of Trade Reforms in India A Decade of Trade Reforms in India: How it compares with East Asia
Ramkishen S. Rajan & Rahul Sen, World Economics, December 2002
This paper summarises recent trade reforms in India and documents the extent to which the country has integrated with the global trading system. The paper argues that India has made important strides since the initiation of reforms in 1991. Although it lags significa ... More


Continuities and Discontinuities in Global Development Continuities and Discontinuities in Global Development: Lessons from new East/West comparisons
Kenneth Pomeranz , World Economics, December 2002
Much literature normalises a ‘North Atlantic’ pattern of development, and sees a regionally specific ‘East Asian’ path emerging relatively recently. However, development patterns in core regions of Europe and East Asia were surprisingly similar until almost 1800; Eur ... More


Japan’s Monetary and Economic Policy Japan’s Monetary and Economic Policy
Allan Meltzer, World Economics, September 2002
Japan has gone from very successful policies that promoted growth without inflation to a long period of slow growth, recessions and deflation. The Bank of Japan’s policies are a major reason for deflation. Although the Bank has purchased foreign exchange, it counterac ... More


The Economic Impact of the World Cup The Economic Impact of the World Cup
Stefan Szymanski, World Economics, March 2002
The World Cup will be the biggest sporting event of 2002, but the Japanese and Korean governments are also hoping that it will be one of the biggest economic events of the year. Impact studies by respected economic research institutes predict a dramatic boost to GDP ... More


Capital Controls Capital Controls: The experience of Malaysia
Jomo K.S., World Economics, March 2002
Malaysia’s decision to adopt capital controls in September 1998 reminded the world that there are alternatives to capital account liberalisation. Unfortunately, there has been a tendency for both sides in the debate over the capital control measures to exaggerate the ... More


The Emerging Northeast–Southeast Asia Divide and Policy Implications The Emerging Northeast–Southeast Asia Divide and Policy Implications
Friedrich Wu, World Economics, March 2001
Since the outbreak of the Asian financial crisis in mid-1997, the gulf between the Northeast Asian economies and Southeast Asian economies has widened as measured by GDP growth rates and size, direct and portfolio investment flows, stock market capitalisation and tradi ... More


Why Did the Protected Areas Fail the Giant Panda? Why Did the Protected Areas Fail the Giant Panda?: The economics of conserving endangered species in developing countries
Timothy M. Swanson & Andreas Kontoleon, World Economics, December 2000
Most biodiversity lies within the developing world, and much of it is under threat because of forces for change within these countries. In order to be effective, biodiversity conservation must be viewed as a development opportunity, rather than as a constraint on devel ... More


Is there a Case for an Asian Monetary Fund? Is there a Case for an Asian Monetary Fund?
Graham Bird & Ramkishen Rajan, World Economics, June 2000
The East Asian financial crisis has spawned a number of proposals for institutional reform. Some envisage reforming existing institutions, particularly the International Monetary Fund (IMF), while others suggest that new institutions are needed. Amongst them is the idea ... More