Social and Behavioral Sciences Commons^™

A General Framework For Price Regulation Of Airports, Sock Yong Phang

PHANG Sock Yong

Price cap regulation (PCR) was first implemented for privatized utilities in the UK in the 1980s. It has since been adopted by numerous countries as a regulatory regime in several sectors. This paper focuses on the development of different forms of price regulation of airports of which PCR is one variant. In countries where airport privatization is still in the early stages, the spectrum of airports and varied nature of regulatory regimes can be confusing and the lack of a general framework can itself become an obstacle to privatization. This paper proposes a general framework comprising decisions to be made …

Instability Of Government Revenue And Expenditure In Less Developed Countries, David Lim

Prof. David Lim

The governments of most less developed countries (LDCs) depend basically on their tax and non-tax revenues to finance their expenditure programmes. Unless countervailing action is taken, instability in government revenue will result in instability in government expenditure. The latter can add considerably to the complexity of fiscal management, which may then render ineffective development planning.1 It can also reduce business confidence and lead to the precautionary discounting of prospective investment returns and so a lowering of the investment level. This note does not attempt to verify the claim that expenditure instability has adverse effects on economic growth. Its aim is …

On The Measurement Of Capital-Intensity, David Lim

Prof. David Lim

The problem of the choice of technique in less developed countries has featured prominently in the literature on economic develop- ment I. This paper shows that despite such interest attempts to measure capital-intensity still leave much to be desired and argues that a modified capital-labour ratio, with capital adjusted for utilization and labour to refer to the number of production workers on the biggest shift, is the theoretically most suitable measure of capital-intensity...

The Jackson Report On Australian Aid: The Underlying Framework, David Lim

Prof. David Lim

In late April 1983, Mr Bill Hayden, the Australian Foreign Minister, set up an independent committee under the chairmanship of Sir Gordon Jackson to review the Australian overseas aid program.1 The report of the committee was tabled in Parliament on 7 June 1984.2 In the subsequent public debate on the Jackson Report, it became clear that the committee's position on various key issues on aid and development was often misrepresented. The misrepresentation could have been deliberate because the report adopted a strategy of development that was not universally accepted. It could also have been because the analytical framework adopted was …

Malaysian Development Planning, David Lim

Prof. David Lim

Development planning has been described as "a deliberate governmental attempt to coordinate economic decision-making over the long-run and to influence, direct and, in some cases, even control the level and growth of a nation's principal economic variables (income, comsumption, employment, investment, saving, exports, imports, etc.) in order to achieve a pre-determined set of development objectives." One set of reasons for planning centres round the operation of the market system. Thus, market prices are often distorted and can result in a misallocation of scarce resources. Another set revolves round the need to have a rallying point for local and foreign interests …

On The Measurement Of Capital Utilisation In Less Developed Countries, David Lim

Prof. David Lim

The shortage of physical capital is often seen as the crucial constraint to growth in less developed countries (LDCs). Thus many development plans are based on the aggregate Harrod-Domar model where the growth of the economy is seen to depand only on the availability and the productivity of capital. A corollary of such a capital-centred approach to development is that the capital plant and machinery installed are utilized to the full. However, recent studies claim that capital under-utilization exists on a massive scale in manufacturing in LDCs and raise the possibility of a parabox in capital usage in capital-scarce LDCs. …

The Garnaut Report: An Overview, David Lim

Prof. David Lim

The Gaunaut Report analyses the process of economic change in Northeast Asia and assesses the implication of this on Australia. It is an important report because of what it says, when it is said, and how it is said. Its findings are neither new nor surprising for those who have been studying Northeast Asian economic development and Australia-Asia relations. But they are nevertheless important findings and presented as they are now and in a report to the Prime Minister and the Minister for Foreign Affairs and Trade by someone who was the former's trusted chief economic adviser and the latter's …

Income Distribution, Export Instability, And Savings Behavior, David Lim

Prof. David Lim

This paper examines the effects of income distribution and export instability on the savings ratios of a group of 12 developed and 52 less developed countries (DCs and LDCs) for 1968-73. The effect of income distribution on savings has been studied before but not on as comprehensive a group of countries as presented here. The effect of export instability on savings has not been examined before in the literature on the determinants of savings behavior. It has, however, been discussed in the literature on the relationship between export instability and economic growth and part of the purpose of this paper …

Explaining The Growth Performances Of Asian Developing Economies, David Lim

Prof. David Lim

No matter how it is measured, the growth performance of the newly industrializing economies (NIEs) stands out. That of the Southeast Asian group, with the exception of the Philippines, and that of China is also impressive. The South Asian countries have done much less well, with countries in sub-Saharan Africa, the Caribbean, and Latin America even further behind...

Export Instability And Economic Development : The Example Of West Malaysia, David Lim

Prof. David Lim

No abstract provided.

Another Look At The Effect Of Capital Subsidies On Capital-Intensity, David Lim

Prof. David Lim

In an earlier paper in this journal, I examined the effect that the provision of capital subsidies, in the form of tax holidays whose duration depends on the level of capital investment, had on the capital-intensity of manufacturing in Peninsular Malaysia. The following basic equations were estimated, by ordinary least squares, for twelve industry-groups for 1972...

Do Foreign Companies Pay Higher Wages Than Their Local Counterparts In Malaysian Manufacturing?, David Lim

Prof. David Lim

This paper shows that foreign companies pay higher wages than their local counterparts in Malaysian manufacturing. Step-wise regression analysis shows that this is due to two factors. The first, and perhaps the more important, is the greater capital intensity of the production processes used by foreign companies. The second is their tendency to pay wages that they consider, or that are considered to be, commensurate with the wages that they pay in their home countries. This may be called the demonstration effect of wage remuneration in less developed countries.

Actual, Desired And Full Levels Of Capital Utilisation In Malaysian Manufacturing, David Lim

Prof. David Lim

This paper shows that capital utilisation in West Malaysian manufacturing, though higher than that in other less developed countries, still leaves capital plant idle for a considerable proportion of the total available time. These findings, based on a modified McGraw‐Hill measure and on the Winston time‐measure of capital utilisation, therefore calls into question the wisdom of an industrial investment incentive programme which aims primarily at maximising the volume of capital expenditure, and which pays no attention at all to the level of utilisation of the existing stock of capital.

East Malaysia In Malaysian Development Planning, David Lim

Prof. David Lim

Malaysia consists of Peninsular Malaysia and the two East Malaysian states of Sabah and Sarawak. Development planning in Peninsular Malaysia began as early as 1950, while the first plan for the whole of the Malaysian federation founded in 1963 was published in 1966. Have the two East Malaysian states been integrated properly into the various Malaysian plans? Or have they, with their somewhat different economic, political and social backgrounds, been treated as a nuisance element and appeared in the plans only as an afterthought? In any case, is the planning experience of Peninsular Malaysia relevant for solving the problems of …

Europe 1992: Economic Implications For Asia, David Lim

Prof. David Lim

The European Economic Community (EEC) was formed in 1957 with the signing of the Treaty of Rome. This brought together six countries (Belgium, France, West Germany, Italy, Luxemberg and the Netherlands) which were involved in the conflict of the Second World War. The Impetus for the establishment of the EEC was political but the economic gains from the operation of the scheme, popularly known as the Common Market, were so significant that eventually the original membership of six was doubled to include Denmark, Greece, Ireland, Portugal, Spain and the United Kingdom. The so-called Europe 1992 Project aims to bring about …

Ability Of The Imf-Cff To Stabilize Export Earnings, David Lim

Prof. David Lim

Finger and Dceosa (1980)1 have shown that the International Monetary Fund's Compensatory Financing Facility (IMF-CFF) did not succeed in reducing the export earnings instability of 71 participating countries over the period 1963-1977. In fact, the IMF-CFF increased, rather than decreased, the export instability of 35 of the 62 participating developing countries, and of 5 of the 9 participating developed countries. Finger and Derosa identified four features of the IMF-CFF which could have reduced its effectiveness in stabilizing export earnings...

Capturing The Effects Of Capital Subsidies, David Lim

Prof. David Lim

Most developing countries provide fiscal incentives to encourage domestic and foreign investment. This study shows that these schemes subsidise significantly the use of capital and produce greater capital intensity in Malaysian manufacturing. These results were obtained by conducting the analysis at the establishment level, which avoids the artificial aggregation of establishments with different production structures into an industry‐group and having to choose an appropriate weighting system in the aggregation process.

Fiscal Incentives And Direct Foreign Investment In Less Developed Countries, David Lim

Prof. David Lim

This study found no support for the belief by the governments of most less developed countries (LDCs) that the provision of fiscal incentives is necessary to attract direct foreign investment and that the greater the generosity of these incentive programmes the greater would be the level of such investment. What mattered were the presence of natural resources and a proven record of economic performance. The provision of incentives could not compensate for the absence of either of these two factors.

Capital Utilisation Of Local And Foreign Establishments In Malaysian Manufacturing, David Lim

Prof. David Lim

It is often argued that foreign firms operating in less developed countries have greater X-efficiency than their local counterparts. However, little empirical evidence has been presented to substantiate this claim. This paper attempts to fill part of this gap, first, by presenting data on the level of capital utilisation in Malaysian and foreign firms in Malaysian manufacturing and, second, by testing the importance of X-efficiency in determining differences in the utilisation levels of the two categories of firms...

Export Instability, Investment And Economic Growth In Developing Countries, David Lim

Prof. David Lim

Export instability is often seen to be detrimental to the economic growth of those developing countries which have a large export sector and which depend on a few primary products for this export. One of the arguments against export instability is that it produces instability in government revenue which leads to instability in government expenditure. This instability in government expenditure is then seen to affect economic growth adversely in two ways...

"Sweat Labor" And Wages In Malaysian Manufacturing, David Lim

Prof. David Lim

References have often been made to the presence of "sweat labor" in manufacturing in less developed countries (LDCs) and of the need to introduce minimum-wage legislation to protect the interests of such employees. However, the data on the wages paid to such workers are almost nonexistent, and the discussion so far has been couched in general terms. I shall attempt to provide some of the empirical basis for the discussion in Malaysia.

Government Recurrent Expenditure And Economic Growth In Less Developed Countries, David Lim

Prof. David Lim

There is not much support in less developed countries for the hypothesis that recurrent government expenditure is seen as consumption and hence more dispensable than capital expenditure. There is little evidence of a secular decline in recurrent expenditure for a group of 54 less developed countries over the period 1965–1973, nor is there strong evidence of greater instability in recurrent expenditure.

Another Look At Growth And Defense In Less Developed Countries, David Lim

Prof. David Lim

Using an estimating equation that was devised systematically within an explicit conceptual framework, it shows that defence spending was detrimental to economic growth. Finds regional differences in that the adverse effects were marked in Africa and the Western hemisphere, but absent in Asia, the Middle East, and Southern Europe.

Export Instability And Economic Growth: A Return To Fundamentals, David Lim

Prof. David Lim

No abstract provided.

Workplace Deviance And Recession, Aniruddha Bagchi, Siddhartha Bandyopadhyay

Aniruddha Bagchi

Restructuring Social Security: How Will Retirement Ages Respond?, Gary S. Fields, Olivia S. Mitchell

Gary S Fields

[Excerpt] Budgetary pressures on the Social Security system have increased in recent years, prompting a variety of proposals to restructure the U.S. retirement income program. Most of these proposals ignore the possibility that the retirement patterns of older workers are likely to respond to changes in the incentives to retire. This chapter presents two important pieces of information for policymakers. First, we provide previously unavailable evidence on how changes in the structure of Social Security benefits would alter the economic incentives to retire at different ages. Second, we compute how retirement patterns would change in response to altered incentives to …

Labor Market Analysis Using Sipp, Gary S. Fields, George H. Jakubson

Gary S Fields

This paper examines the potentiality of the Survey of Income and Program Participation (SIPP) for labor market analysis. We consider five areas of analysis: (1) labor force participation, employment, and unemployment; (2) labor market effects of income maintenance programs; (3) earnings; (4) work and retirement of the elderly; and (5) migration. We find that the SIPP is a potentially rich resource for labor market analysis, surpassing much of what is to be found in existing databases. We note some remaining problems and make recommendations for changes.

The Meaning And Measurement Of Income Mobility, Gary S. Fields, Efe A. Ok

Gary S Fields

Income mobility may be seen as arising from two sources: (i) the transfer of income among individuals with total income held constant, and (ii) a change in the total amount of income available. In this paper, we propose several sensible properties defining the concept of income mobility and show that an easily applicable measure of mobility is uniquely implied by these properties. We also show that the resulting measure is additively decomposable into the two sources listed above, namely, mobility due to the transfer of income within a given structure and mobility due to economic growth or contraction. Finally, these …

Rewards For Continued Work: The Economic Incentives For Postponing Retirement, Olivia S. Mitchell, Gary S. Fields

Gary S Fields

This chapter develops empirical measures of the economic incentives for deferred retirement among older workers. Using a new data file on pay and pensions, we construct intertemporal budget sets reflecting income available to workers at alternative retirement ages. The analysis explores how continued labor force attachment is rewarded in terms of net earnings, Social Security benefits, and private pension income.

On-The-Job Search In A Labor Market Model: Ex Ante Choices And Ex Post Outcomes, Gary S. Fields

Gary S Fields

This paper builds a multi-sector labor market model including wage dualism, open unemployment, underemployment, on-the-job search, and expected wage equalization. The innovative feature of this model is the distinction between the ex ante allocation of the labor force among search strategies and the ex post allocation of the labor force among labor market outcomes. Among the findings are: more efficient on-the-job search lowers the equilibrium unemployment rate; in a rational expectations equilibrium, the average rural and urban wages will not be equal; modern sector enlargement may leave labor market conditions in one of the sectors unchanged, even when wages and …