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4321. Firm Size, Technical Efficiency and Productivity Growth in Chinese Industry'

Author:
Dic Lo and Yuk-Shing Cheng
Publication Date:
12-2004
Content Type:
Working Paper
Institution:
School of Oriental and African Studies - University of London
Abstract:
Since the mid-1990s, China's state leadership has adopted a policy of nurturing the competitiveness of large state-owned industrial enterprises. The implications of this policy have been a matter of debate in the literature. This paper seeks to provide some useful input into the debate. With a view of investigating into the potential of long-term development of large enterprises, we estimate the “sequential production technology” in computing the Malmquist productivity index for various size-groups of enterprises in Chinese industry. Our findings indicate that large enterprises did register the fastest productivity growth and improvement in technical efficiency in the 1994-97 period. It thus appears that large-scale, mainly state-owned Chinese enterprises have exhibited the potential of m a king noticeable improvements and the relevant state policy does have its justification.
Topic:
International Relations, Development, Economics, and International Political Economy
Political Geography:
China

4322. Social origins of Ottoman industrialisation: Evidence from the Macedonian town of Naoussa

Author:
Costas Lapavitsas
Publication Date:
09-2004
Content Type:
Working Paper
Institution:
School of Oriental and African Studies - University of London
Abstract:
Ottoman industrialisation in cotton spinning was led by the town of Naoussa in Macedonia. This paper shows that Naoussa capitalists grasped the opportunities created by trade liberalisation, accumulated capital in domestic manufacture of woollen cloth, and secured a regular supply of low-wage female labour and free hydraulic energy. It is further shown that they took advantage of local institutional and political mechanisms within the Christian community independent of the relatively remote Ottoman state. But there was no capitalist transformation of agriculture, even though Naoussa capitalists often owned large land estates. Lack of broader institutional and political influence and absence of capitalist transformation of agriculture hampered the transformation of Naoussa capitalists from a provincial social group into a broad-based capitalist class.
Topic:
International Relations, Development, Economics, and International Political Economy
Political Geography:
Macedonia

4323. China's Nexus of Foreign Trade and Economic Growth: Making Sense of the Anomaly

Author:
Dic Lo
Publication Date:
08-2004
Content Type:
Working Paper
Institution:
School of Oriental and African Studies - University of London
Abstract:
Using a range of specifications that are standard in the relevant literature, this paper finds that China's rapid and sustained economic growth in the reform era has tended to be negatively correlated with its export growth and positively correlated with its import growth. This finding runs counter to widely -held perceptions on China's nexus of foreign trade and economic growth, and thus presents a serious challenge for interpretation. On the basis of some further regression analyses, and drawing on a number of applied studies on the subject matter, the paper argues that the finding is plausible and of complex ramifications. The conclusion which this paper arrives at, therefore, is that the Chinese experience has tended to be a case of strategic integration into the world market, rather than conforming to the standard neoclassical thesis of trade regime neutrality.
Topic:
International Relations, Development, Economics, and International Political Economy
Political Geography:
China

4324. The case for regional exchange rate arrangement in East Asia'

Author:
Takuji Kinkyo
Publication Date:
08-2004
Content Type:
Working Paper
Institution:
School of Oriental and African Studies - University of London
Abstract:
The Asian crisis highlighted the difficulties for developing countries to actively manage exchange rates in an environment of high capital mobility. Now it became fashionable to argue that the exchange rate should be either allowed to float freely or irrevocably fixed. This paper examines the case for regional exchange rate arrangements as an instrument to enhance the manageability of exchange rates and discusses the options in East Asia. It critically assess the existing proposal of common basket peg system and suggests that East Asia should seek to create an Asian-version of regional monetary system modeled on the EMS.
Topic:
International Relations, Development, Economics, and International Political Economy
Political Geography:
East Asia and Asia

4325. Disorderly adjustments to exchange rate misalignments: The experience of Korea'

Author:
Takuji Kinkyo
Publication Date:
08-2004
Content Type:
Working Paper
Institution:
School of Oriental and African Studies - University of London
Abstract:
This paper analyzes Korea's exchange rate dynamics before and during the crisis of 1997-98 by estimating the long-run fundamental exchange rate and the associated error correction model. The analysis suggests that although Korea's exchange rate was substantially overvalued before the crisis, the subsequent exchange rate dynamics could not fully be accounted by the need to correct misalignments. It was found that there was a large deviation from the short-run fundamental value of exchange rates, indicating the presence of “overshooting of the overshooting equilibrium” during the crisis. The findings have important policy implications for crisis management in emerging market economies.
Topic:
International Relations, Development, Economics, and International Political Economy
Political Geography:
Korea

4326. Transmission channels of capital flow shocks: why Korean crisis was so severe'

Author:
Takuji Kinkyo
Publication Date:
08-2004
Content Type:
Working Paper
Institution:
School of Oriental and African Studies - University of London
Abstract:
The Asian crisis highlighted the vulnerability of emerging market economies faced by sudden capital flow reversals. An important question that has critical implications for crisis management is how negative shocks in capital inflows were transmitted to economic activities, transforming financial instability into fully-fledged crises. Using VARs, this paper analyzes the transmission mechanism of capital flow shocks during the Korean crisis of 1997-98. Although it is commonly believed that severe economic contractions were caused by credit crunch, the analysis suggests that the major constraint for production was a steep rise in prices of imported inputs due to sharp exchange rate depreciations.
Topic:
International Relations, Development, Economics, and International Political Economy
Political Geography:
Asia and Korea

4327. Does South Africa Suffer from the Fear of Float' Syndrome?An Analysis of the Efficacy and Challenges of a Managed Floating Exchange Rate Regime with Financial Integration'

Author:
Olano Makhubela
Publication Date:
07-2004
Content Type:
Working Paper
Institution:
School of Oriental and African Studies - University of London
Abstract:
The paper examines whether South Africa suffers from a 'fear of float' syndrome. The analysis also covers the efficacy and challenges of a managed floating exchange rate regime. I use time series data, volatility equations and ARCH models to test the volatility of South Africa's exchange rate, interest rate and foreign exchange reserves. Evidence shows that South Africa has volatile interest and exchange rates, but not foreign exchange reserves. Yet, South Africa does not seem to suffer from an extreme and chronic form of 'fear of floating'. South Africa requires financial integration to finance its current account deficits and to complement its low savings rate. Yet, evidence indicates that both capital account openness and foreign exchange control liberalization have no robust impact on growth. The authorities' intervention in the 2001 currency crisis did not help. Hence, I recommend that South Africa should use interest rates early to target both inflation and foreign exchange rates. Challenges remain in the form of relatively high interest rates, volatile capital flows, perceptions, destabilizing speculation, and loopholes in foreign exchange controls.
Topic:
International Relations, Development, Economics, and International Political Economy
Political Geography:
South Africa

4328. Globalisation and Comparative Economics: Of Efficiency, Efficient Institutions, and Late Development'

Author:
Dic Lo
Publication Date:
06-2004
Content Type:
Working Paper
Institution:
School of Oriental and African Studies - University of London
Abstract:
Does globalisation entail a demand for uniformity, or diversity, of the (political) economic institutions of nation-states? What is the theoretical underpinning of the demand? And what are the implications of the demand for economic development? The conventional literature known as comparative economic systems has been unable to answer these question, because there is an intrinsic tension between its methodology (the neoclassical framework of individualistic rational choices and their equilibrium) and the subject matter (the multiplicity of economic institutions and development experiences in the real world). The new comparative economics has consisted of a variety of attempts to cope with this tension: some aimed at preserving the neoclassical framework at a m o re fundamental level, while some others aim e d at transcending the framework to arrive at a new theory of economic system s and development. This paper argues that attempts that adhere to the neoclassical tradition is likely to lead to dead ends, while attempts that encompass collective as well as individualistic rationality represent m o re promising directions. Fuller developments of the literature, however, require incorporating objectified institutions and paradigmised technology in to its sphere of inquiry. It is submitted that there are important lessons to learn from classical political economy and their modern presentations, particularly Marxian theories of the social forces of production, in this regard.
Topic:
International Relations, Development, Economics, and International Political Economy

4329. Household water and sanitation services in Saudi Arabia: an analysis of economic, political and ecological issues'

Author:
Elie Elhadj
Publication Date:
05-2004
Content Type:
Working Paper
Institution:
School of Oriental and African Studies - University of London
Abstract:
This study evaluates Saudi Arabia's investment in household water and sanitation services (WSS) over the past three decades or so. It finds that over one half of Saudi householders still have no municipal water connections and two thirds are without sanitation connections. Saudi cities have no rain water drainage system s to deal with the brief and occasional, but severe deluges of winters. Desalinated water is transmitted across hundreds of kilometers of desert terrain to two major urban centers (Riyadh and Qaseem) that are rich in groundwater reserves while their local water is used in irrigation.
Topic:
International Relations, Development, Environment, and International Political Economy
Political Geography:
Saudi Arabia

4330. Camels don't fly, deserts don't bloom: an assessment of Saudi Arabia's experiment in desert agriculture'

Author:
Elie Elhadj
Publication Date:
05-2004
Content Type:
Working Paper
Institution:
School of Oriental and African Studies - University of London
Abstract:
Severe arid conditions constrained agricultural production and population size in the Arabian Peninsula over the millennia (except around oases and in parts of Yemen). An abrupt change in Saudi Arabia started in the 1980s to make the desert bloom. This study examines whether or not the Saudi experiment in desert irrigation has been worthwhile in terms of cost and benefit. It concludes that the project was a waste of money and water on a grand scale.
Topic:
International Relations, Development, Environment, and International Political Economy
Political Geography:
Yemen, Saudi Arabia, and Sinai Peninsula