1,721,067 research outputs found
Multinational Corporations and Pacific Regionalism
Full text linkThe purpose of this paper is twofold. The first is to determine empirically whether there is a unique regional model of foreign direct investment (FDI) somewhere in the AsiaPacific region, driven by complex network behaviour of multinational corporations. The second is to determine empirically whether the investment provisions of preferential trade agreements (PTAs) have had any influence on this regional investment behaviour. The results suggest that the answer to the first question is affirmative and the answer to the second is negative. They show that when FDI and trade are sufficiently driven by fundamentals, as in Asia, the resulting network patterns of investment do not need to be boosted by investment provisions of PTAs. Further, the network patterns can be sufficiently strong to insulate a country from investment diversion when the FDI source countries play the PTA game elsewhere. So the investment provisions of PTAs pose neither a threat nor a promise to FDI in the Asian region. But a very real threat may come from the trade provisions of PTAs.
East Asian Economic Integration and its Impact on Future Growth
Full text linkTwo propositions appear to be gaining wide currency, given the revealed preference for preferential trade agreements (PTAs) in the East Asian region and elsewhere. The first is that economic integration is a good way to promote economic growth. The second is that PTAs, particularly ones that go beyond goods trade, are an effective way to promote economic integration. Yet both propositions are empirical questions. In this paper, a partial evaluation of the evidence suggests caution is called for. Current PTAs appear to be doing little to remove the important impediments to growth in the region. Far greater income gains would come from comprehensive reform of nondiscriminatory impediments to competition, as part of a thorough-going program of unilateral domestic regulatory reform. It may be time to rethink East Asian economic integration as a policy priority, or at least review the way in which it might be pursued.East Asia, economic integration, trade, Growth
The Flow of Funds through a Government – A Case Study on Japan
Full text linkIn Japan, the sustainability of public finance including that of social security is of serious concern. The underlying cause is that Japan is in transition to a new phase of economy and society because of medium-term changes in the revealed preferences of people about their lifestyle. Nevertheless, the socio-economic systems and institutions, which are founded on public opinion (or the stated preferences of people), have not kept up those changes. This would contribute to the distortion in the flow of funds through the government, adversely influencing the fiscal sustainability. That distortion should be corrected based on such an understanding.
What Behind-the Border Reforms in Services and Investment are Best Done through Trade Agreements?
No full textAbstract : What behind-the-border reforms in services and investment are best done through trade agreements? One way to answer this question is to think of trade agreements as being exercises in piecemeal reform, in the sense that they provide opportunities for reform, but in a constrained, partial manner. The key policy question is whether countries should unreservedly take advantage of these opportunities, despite the constraints, or whether the nature of the constraints should temper the way in which they go about the reforms. This paper first compares trade agreements, as exercises in piecemeal reform, with other modes of liberalization. It then considers which particular reforms should be included in trade agreements. It develops two key principles of piecemeal reform in services and investment. The first is to look for sectors where trade barriers tend to add to real resource costs. The second is to look more broadly than just removing discrimination against foreign providers. The paper concludes with some general guidance for trade negotiators and trade ministers. JEL Classification: F13, F1
Tax Law Asymmetries and Income Shifting : Evidence From Japanese Capital Keiretsu
Full text linkWhen positive and negative income are treated asymmetrically under a corporate income tax (CIT) without allowance for group taxation, a group of affi liated corporations may engage in tax avoidance by shifting income from profi table to unprofi table subsidiaries for the sole purpose of minimising the sum of tax liabilities of the group members. The aim of this paper is to offer systematic evidence on the behavioural response to a tax penalty that arises from doing business in multiple entities, in order to provide justifi cation for group tax systems such as consolidated fi ling and loss transfer. The setting for our investigation is the Japanese CIT before the introduction of a group tax system. We develop a theoretical model of a corporate group that predicts a difference in profi t reporting behaviour between subsidiaries above and below 100 million yen in paid-in capital due to the progressive feature of the Japanese CIT. We test the implications of the model with a company-level data on subsidiaries based on survey that covers over 1,700 corporate groups headed by large corporations. The sample consists of 33,340 subsidiary-time pairs from 1988, 1990, and 1992. We fi nd evidence consistent with a hypothesis that corporate groups shift income among group members. The fi nding underscores the importance of accounting for the group behaviour in the design of CIT.
Can the New Antimonopoly Act Change the Japanese Business Community? : The 2005 Amendment to Antimonopoly Act and Corporate Compliance
Full text linkIt has been reported in the media that bid rigging is commonly practised in almost all public works projects in Japan. It was also said that the Japanese anti-trust authority, the Japan Fair Trade Commission (JFTC), was a watchdog that did not bite, in spite of having a long history of enforcement since 1947. However, the situation is significantly changing because the Japanese Antimonopoly Act was amended in 2005 to greatly strengthen anti-trust enforcement. The JFTC has already succeeded in cracking down against bid rigging committed by big and famous companies under the new Act. For the present, the Japanese business community has to seriously address compliance problems. Can the AMA change the business community?
Reliability of Structural Shocks Estimates from a Bivariate SVAR Model - The Case of Southeast Asian Countries
Full text linkIn order to assess the symmetry in the nature of structural shocks for a bloc of countries to form a currency union, long-run identifying restrictions to simple bivariate models are often used. This study attempts to assess the reliability of the estimated structural shocks produced from applications of these kinds of models by looking at their consistency in representing the designated shocks. The case examined covers some countries in the Southeast Asian bloc. The finding suggests that the commingling shocks problems exist. Exercise using larger models and higher frequency data is then advisable.Structural Shocks Estimates, Bivariate SVAR Model, South East Asia
How Should One Evaluate Fiscal Conditions - A Study Based on the Comparison between Japan and Australia
Full text linkIn comparing fiscal indicators of Japan and Australia, it is generally perceived that Japans fiscal conditions are very serious and those of Australia are very sound. However, in Australia the rising ratio of foreign liabilities to GDP is the source of anxiety in the market, which in turn reduces the flexibility of fiscal policy. If such economic conditions are considered, the evaluation of Australias fiscal conditions is worse than one based on fiscal indicator alone, while the opposite relationship is the case for Japan. The fiscal conditions of the two countries are a good example to demonstrate that fiscal conditions should be evaluated as part of economic conditions.Fiscal Conditions, Japan, Australia
Trade in Services in the Asia Pacific Region, NBER East Asia Seminar on Economics (EASE), Volume 11
Full text linkUS and EU Trade Policies and East Asia
Full text linkThis article identifies a number of examples of apparent lack of coherence in United States and European Union trade policies. They include the effect of preferential policies that lock in trade shares and inhibit growth promoting structural adjustment, biases in tariff structures, policies that affect incentives of developing countries to make commitments in the World Trade Organisation, the use of anti-dumping actions and the nature of tariff peaks and escalation. The origins of the lack of policy coherence lie within the domestic policy-making processes of the developed economies. An important question, then, is whether opportunity exists for East Asian economies to mobilise to induce an external shock sufficient to shift policy consensus in the United States and the European Union The key elements of such a grand bargain on trade in manufactured goods would include an explicit East Asian commitment to bind more tariff lines, initiatives to resolve the problem of accelerating anti-dumping actions and a replacement for the program of tariff preferences. A package of trade policy reforms of this type in East Asia would constitute a substantial offer and benefit to the United States and the European Union. It has the potential to trigger a response of equal benefit to East Asian economies.trade policy, US, EU, East Asia
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