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901. Local Administration of Social Assistance Programs in Russia

Author:
Raymond J. Struyk and Burton Richman
Publication Date:
10-2000
Content Type:
Working Paper
Institution:
Urban Institute
Abstract:
Competent administration is fundamental to successful reform of social assistance programs in transition economies. Only with such administration is there assurance that benefits are being delivered as intended in enabling legislation. Moreover, the perceived efficiency and fairness of administration influences the public's views of the new programs. In the Russian Federation local governments have primary responsibility for the administration of social assistance programs enacted by all levels of government
Topic:
Economics, Government, and Human Welfare
Political Geography:
Russia, Europe, and Asia

902. Where Did India Miss a Turn in Banking Reform? Is there a comeback?

Author:
Pradeep Raje
Publication Date:
12-2000
Content Type:
Working Paper
Institution:
Center for the Advanced Study of India
Abstract:
A decade into financial sector liberalization, there has been little concerted effort at restructuring the Indian public sector banks (PSBs). Though there has been significant progress in banking regulatory reform in the decade, the lack of restructuring has slowed down the assimilation of the incentive structures inherent in the new regulations.
Topic:
International Relations, Debt, and Economics
Political Geography:
India and Asia

903. The Crisis in Asia: An Empirical Assessment

Author:
Warwick McKibbin
Publication Date:
12-1999
Content Type:
Working Paper
Institution:
The Brookings Institution
Abstract:
The economies of South East Asia and Korea have been shaken by a financial and economic crisis that has enveloped the region since mid 1997. There are competing explanations for the cause of the crisis however most commentators would agree that a major shock that impacted on the countries has been a dramatic increase in the perceived risks of investing in these economies. This paper explores the impact of a re-evaluation of the risk in the Asian economies focussing on the differential real consequences of a temporary versus more permanent rise in risk. It contributes to our understanding of the possible consequences of the Asia crisis by applying a global simulation model that captures both the flow of goods as well as international capital flows between countries. The real impacts on the Asian economies of a rise in risk perceptions in the model are large and consistent with observed adjustment. However the spillovers to the rest of the world are relatively small because the loss in export demand that accompanies the crisis in Asia is offset by a fall in long term interest rates as capital flows out of Asia into the non-Asian OECD economies. Thus strong domestic demand in economies such as the US induced by the general equilibrium effects of the reallocation of financial capital can more than offset the consequences of lower export growth. The analysis also highlights the impacts on global trade balances reflecting the movements of global capital and points to both potential problems and lesson for policymakers over the coming years.
Topic:
Economics, Emerging Markets, and Globalization
Political Geography:
China, Israel, East Asia, and Asia

904. The Global Economic Impacts of Trade and Financial Reform in China

Author:
Warwick McKibbin and KK Tang
Publication Date:
12-1999
Content Type:
Working Paper
Institution:
The Brookings Institution
Abstract:
Despite the setbacks from the recent Asian currency crisis, the ascendancy of Asia as an economic centre of world economic activity is likely to continue into the 21st century. A key issue that will shape the role of Asia, and indeed the shape of the world economy in the 21st century, is the economic development of China. To date China has successfully weathered the currency storm in Asia and continues on a program of economic reform. If anything, the problems of Japan and Korea provide powerful lessons for other countries undergoing rapid economic growth and structural change. These lessons include the importance of a well developed financial sector with lending and investment decisions based on market signals rather than government directives. Whether China can further integrate smoothly into global markets and sustain the fast growth of the last few decades will be a crucial development in the world economy. In this paper, we explore the impacts of continued Chinese economic reform with a focus on the role of international financial flows both in the adjustment within China as well as in the transmission of Chinese reforms to the rest of the world.
Topic:
Economics, Emerging Markets, and Globalization
Political Geography:
China, Israel, East Asia, and Asia

905. Regional and Multilateral Trade Liberalization: The Effects on Trade, Investment and Welfare

Author:
Warwick McKibbin
Publication Date:
12-1999
Content Type:
Working Paper
Institution:
The Brookings Institution
Abstract:
This paper explores the impact on economies of trade liberalization under alternative regional and multilateral arrangements: unilateral liberalization; liberalization as part of the ASEAN regional grouping; liberalization as part of the APEC regional grouping; or liberalization as part of a multilateral trade liberalization regime. The paper is based on a Dynamic Intertemporal General Equilibrium model (DIGEM) called the Asia-Pacific G-Cubed Model. It is shown that the long run gains from a country's own liberalization tend to be large relative to the gains from other countries liberalizing although this varies across countries. It is also shown that there is a significant difference between the effects on GDP (production location) and the effects on consumption per capita of the alternative liberalization approaches across countries. The timing of liberalization is also shown to matter. With open capital markets the gains from credibly announced trade liberalization are realized before the reforms are put in place because there is a rise in global investment which raises the global capital stock. In addition there is a reallocation of capital via financial market adjustment. This paper also demonstrates that for some economies, there can be short run adjustment costs to trade liberalization because resources cannot be instantly reallocated across sectors in an economy. These adjustment costs from own liberalization can be reduced if more countries also liberalize. The nature of the dynamic adjustment suggests that other macroeconomic policies may play an important role during the early period of phased-in trade liberalization.
Topic:
Economics, Emerging Markets, and Globalization
Political Geography:
China, Israel, East Asia, and Asia

906. Rapid Economic Growth in China: Implications for the World Economy

Author:
Warwick McKibbin and Yiping Huang
Publication Date:
12-1999
Content Type:
Working Paper
Institution:
The Brookings Institution
Abstract:
Rapid growth of the Chinese economy in the past decade and its potential for strong growth into the foreseeable future have caused anxieties in the rest of the world. Some commentators see Chinese growth wholly in terms of competition for trade and investment opportunities with other developing economies and a major cause of structural adjustments in the advanced industrialized economies. In particular there have been warnings of severe consequences for international agricultural markets. In this paper we use a dynamic general equilibrium model called the G-CUBED model (developed by McKibbin and Wilcoxen) to explore possible future paths of the Chinese economy based on projections of population growth, sectoral productivity growth, energy efficiency and technical change in the Chinese economy. This model captures not only the composition of the direct trade impacts of developments in the Chinese economy but also the implications of the endogenous flows of financial capital on macroeconomic adjustment in the world economy. The study focuses on the period from 1990 to 2020. Rather than being a problem for the world economy, we find strong growth in China is beneficial for the world economy directly through raising world incomes.
Topic:
Economics, Emerging Markets, and Globalization
Political Geography:
China, Israel, East Asia, and Asia

907. The Transmission of Productivity and Investment Shocks in the Asia Pacific Region

Author:
Warwick McKibbin
Publication Date:
12-1999
Content Type:
Working Paper
Institution:
The Brookings Institution
Abstract:
An important aspect of macroeconomic interdependence in the Asia Pacific region is the adjustment of trade and current account balances in response to changes in saving and investment rates in individual economies. Greater trade flows, reliance on imported intermediate goods as well as more integrated capital markets imply that shifts in private or public saving and investment rates in an economy in the region can potentially have large impacts on other economies. This paper explores the quantitative nature of these linkages by focusing on a number of shocks within the context of a new dynamic multi-sector global model called the Asia-Pacific G-Cubed Model (AP-GCUBED). This model integrates sectoral adjustment with macroeconomic interdependence including explicit treatment of capital flows to explore the implications of a variety of productivity and investment shocks in the Asia Pacific Region. The first shock considered is a permanent decline in private investment in Japan. The second shock is a temporary rise in total factor productivity growth in China. The fall in Japanese investment is found to have a significant effect on trade flows and financial flows in the region whereas the rise in Chinese productivity has a quite different effect on the region.
Topic:
Economics, Emerging Markets, and Globalization
Political Geography:
China, Israel, East Asia, and Asia

908. Replacing Potemkin Capitalism: Russia's Need for a Free-Market Financial System

Author:
Kurt Schuler and George A. Selgin
Publication Date:
06-1999
Content Type:
Working Paper
Institution:
The Cato Institute
Abstract:
On August 17, 1998, Russia devalued the ruble and stopped payment on its government debt, creating a financial crisis that continues today. Some observers have blamed the financial crisis, and the poor performance of the Russian economy generally, on government policies that they claim are rigidly laissez faire. However, a closer look at the Russian financial system reveals that it remains fundamentally socialist, though it has superficial capitalist features.
Topic:
Debt, Economics, Government, and Financial Crisis
Political Geography:
Russia, Europe, and Asia

909. U.S. Assistance for Market Reforms: Foreign Aid Failures in Russia and the Former Soviet Bloc

Author:
Janine R. Wedel
Publication Date:
03-1999
Content Type:
Working Paper
Institution:
The Cato Institute
Abstract:
Since the fall of the Berlin Wall in 1989 and the subsequent breakup of the Soviet Union in 1991, the governments of the United States and other Western countries have provided massive aid to promote a transition to the free market in Central and Eastern Europe and the former Soviet Union. But aid for market reforms in the region has been largely ineffective. Whether provided in the form of technical assistance, grants to political groups or nongovernmental organizations, loans and guarantees to the private sector, or direct financial aid to post-communist governments, that aid has been plagued by a number of problems. The failed $22.6 billion bailout of Russia by the International Monetary Fund in July 1998 only confirmed the flawed nature of the aid-for-reform approach.
Topic:
Economics and Emerging Markets
Political Geography:
Russia, United States, Europe, Eastern Europe, Asia, and Soviet Union

910. Hazards and Precautions: Tales of International Finance

Author:
Gary Clyde Hufbauer and Erika Wada
Publication Date:
09-1999
Content Type:
Working Paper
Institution:
Peterson Institute for International Economics (PIIE)
Abstract:
In the wake of financial crises in Mexico (1994-95), Asia (1997-98), Russia (1998) and Brazil (1998-99), respected observers have questioned the benefits of wide-open international capital markets (Bhagwati, 1998; Krugman, 1998; Rodrik, 1998; Eichengreen, 1999). Our purpose is to identify true hazards and suggest appropriate precautions.
Topic:
Economics, International Trade and Finance, and Political Economy
Political Geography:
Russia, Asia, Brazil, and Mexico