Interregional Inequalities in Indonesia: A Sectoral Decomposition Analysis for 1975–92

In this paper we examine interregional income inequalities in Indonesia from 1975 to 1992, Williamson's weighted coefficient of variation is used to measure interregional income inequality. We also perform a sectoral decomposition analysis to investigate the extent to which industrial sectors contribute to the overall weighted coefficient of variation. One major finding is that, although interregional income inequality remained fairly stable in non-mining GDP during the study period, it has undergone a significant change in structure. The contribution of the tertiary sector to inequality, though still dominant, has gradually declined. The secondary sector, meanwhile, is playing an increasingly important role, reflecting its growing share of GDP. Inequality is much smaller in consumption expenditure than in non-mining GDP. Its consistently high levels in fixed capital formation reflect the uneven distribution of investments over space in Indonesia.     

A note on land use in a square city

This paper considers a two-dimensional rectangular city with a grid road system, including a square city as a special case, and then derives a simple equilibrium traffic pattern in the case of constant road width. We maintain that while land-use decisions using market rents would lead to overallocation of land to transportation in our square city as in the Solow Vickrey long narrow city, the tendency towards excessive road-building is stronger near the city boundaries than at the city center in our two-dimensional case, contrary to the conclusion drawn from the Solow Vickrey model.     

Dynamics of quote and deal prices in the foreign exchange market

We empirically investigate price fluctuations of yen-dollar exchange rate using the high-frequency data recorded in the electronic broking system for seven-year period. The distribution of quote price changes has symmetric fat-tails approximated by a power law; however, that of deal price is asymmetrical. The autocorrelation function and diffusion of price changes indicate that quote price exhibits anti-correlation feature in short time scale, whereas deal price is essentially uncorrelated. The bid-ask spread shows power-law distribution and long range temporal correlations similar to that observed in absoute price changes.      

Bartlett correction to the likelihood ratio test for MCAR with two‐step monotone sample

Assuming that two‐step monotone missing data is drawn from a multivariate normal population, this paper derives the Bartlett‐type correction to the likelihood ratio test for missing completely at random (MCAR), which plays an important role in the statistical analysis of incomplete datasets. The advantages of our approach are confirmed in Monte Carlo simulations. Our correction drastically improved the accuracy of the type I error in Little's (1988, Journal of the American Statistical Association, 83 , 1198–1202) test for MCAR and performed well even on moderate sample sizes.     

Remittances and the Dutch Disease: Evidence from Panel Data for 18 Developing Countries

In this paper, using the GMM technique we attempt to empirically investigate the Dutch disease effect of remittances. The analyses are based on an annual balanced panel data set for 18 developing countries, which have remittances to GDP ratio of 5 percent and above, over the years 1999–2015. It is found that an inflow of remittances has a positive effect on economic growth, whereas it leads to a depreciation of the real effective exchange rate.     

Changing International Financial Architecture: Growing Chinese Influence?

It is often said that the 21st century will be the Asian century. Based on population and gross domestic product projections, it certainly looks as if this will be so. Will the existing international financial institutions give more voices, votes, and top positions to Asia? Or will Asia create its own institutions that would rival the old architecture? This present paper argues, first, that China, and possibly India, will be in a position to be so influential that the international financial architecture may have to go through significant changes. Second, the three large crises in the last 20 years have made Asian countries more confident that they can manage capital flows by accumulating large foreign reserves and by adopting sound macrofinancial policies. After 2009, China started to push various initiatives that will amount to creating its own sphere of influence with new regional institutions in the future.