Decomposing polarisation across developing countries: case study of China,India, and Indonesia

We investigate the contributions of various factors in the differences in polarisation across China, India, and Indonesia using micro‐simulation and decomposition methods. Using household expenditure from harmonised data from these countries, China was found to have the highest polarisation, while India has the lowest. Using India as the base country, the differences in the labour market structures in India and Indonesia have a slightly decreasing effect on polarisation. The effects of the differences in demographic composition and expenditure structures/parameters, however, are uncertain. Further, the differences in polarisation between China and Indonesia can be explained mostly by the differences in the expenditure structures. China's expenditure structure tends to increase polarisation, as evidenced by the resulting reduction in the size of the middle class.     

The development tariff and investment in municipal heat supply systems

For years, investment in municipal housing and public utilities (MHPU) has been pronounced a cure-all for the woes of this sector in Russia. Housing services will certainly attract private investors. This assumption is, however, hardly justified for the debt-ridden monopolistic public utilities, where rates are strictly regulated and investment efficiency is low. Private investors expect to return their money. A federal law adopted at the end of 2004 pointed at an obvious source of return on investment, i.e., the investment component of the tariff turning a payback tariff into a development tariff. In this connection, it is important to find out whether the development tariff can be used to secure an acceptable payback period for investments in heat supply systems when the household solvency is low, if tariff rise entails sharp growth in budgetary expenditures on subsidies for the population, and the current heating tariff often fails to reach even the production cost level.     

地方政府腐败会影响私人投资积极性吗？ ——基于动态面板模型的系统GMM分析

通过对中国省级层面数据建立的动态面板模型进行SYS-GMM估计发现,中国的地方政府腐败对私人投资积极性产生了显著的负面影响,尽管腐败并非影响私人投资的最重要因素,但其负面影响超过了政府公共投资带来的私人投资挤入效应。私人投资对直接影响其成本收益状况的因素最为敏感。多种稳健性检验表明腐败对私人投资的影响显著性和力度是非常稳定的。     

China's human capital investment

This paper discusses human capital investment in China. China's current policies favor physical capital investment over schooling and urban human capital investment over rural human capital investment. Current migration policies discriminate against children of migrants. A more balanced investment strategy across rural and urban regions and types of capital is appropriate. Private funding for education through tuition and fees should be encouraged and can supplement government funding and make schools more financially self-sufficient. However, if this policy is enacted, capital markets for financing education need to be developed to avoid discouraging students from poor families from attending school.     

民营企业成长中的人力资源开发研究——一种企业社会资本的视角

民营企业在高速成长中出现一系列人力资源开发问题。本文运用社会资本理论,把民营企业看作一个组织共同体,从网络、规范、信任三方面探究其成长中的人力资源开发问题。并提出相应对策,在加大人力资本投资的同时,不断积累和更新社会资本,由传统的关系性社会资本向现代契约性社会资本转变。这样才能实现提高人的才能、增强人的积极性的企业人力资源开发的双重目标。     

Survey of Recent Developments

As Indonesia heads to the polls in 2014, its economy is slowing. The end of the commodities boom and the global return to more normal monetary policy has exposed some weaknesses. Exchange-rate depreciation has absorbed some of the adjustment; but structural rigidities are still likely to limit the expansion of non-commodity sectors, and the increased fuel-subsidy bill for imported oil is putting pressure on the current account and the budget. The immediate focus is on demand-side consolidation to manage inflation and the currentaccount deficit.

For an economy like Indonesia’s to be overheating, and for monetary and fiscal authorities to be engineering a soft landing, when growth is below 6%, points to major structural problems. If Indonesia is to prevent the current rate of growth from becoming the new normal, there will need to be a substantial supply-side response to lift productivity, as well as a restructuring of the economy and the introduction of policies that make the economy more flexible in adjusting to shocks. The current economic slowdown has yet to trigger sweeping reforms; policy coordination remains problematic as Indonesia enters a big political year.

Compared with its neighbours, Indonesia is largely on the outside of the regional production networks, and its manufacturing sector does not play into factory Asia. Now, faced with lower commodity prices globally—and growth in non-resource sectors is critical— the lack of a large manufacturing base appears to be a weakness. Indonesia is attracting more foreign direct investment than ever and is climbing the global rankings of preferred economies in which to invest, but this is occurring without improvements to its investment environment or competitiveness. Indonesia can participate more fully in global supply chains and increase its potential for growth by upgrading its infrastructure, improving its investment environment, and using regional initiatives strategically to make strong commitments that reinforce its priorities for domestic reform.

In its hosting of APEC in 2013, Indonesia championed infrastructure investment where the lack of structural reform and macroeconomic constraints are inhibiting much-needed expansion, both in Indonesia and in the region. The positive outcome, albeit only a small step forward for the Doha Round, at the WTO Ministerial Conference in Bali, in December, also builds momentum for better regional and global cooperation. The priority now is for Indonesia to commit to, and show leadership in, the Regional Comprehensive Economic Partnership (RCEP) and the implementation of the ASEAN Economic Community.     

FOREIGN DIRECT INVESTMENT IN INDONESIA: FIFTY YEARS OF DISCOURSE

The topic of foreign direct investment (FDI) has been prominent in assessments of economic development in Indonesia during the past 50 years. In this article I review Indonesia's FDI record in a historical perspective; the current urge to control FDI inflows and the need to augment domestic savings and facilitate technology transfers are not at all new in Indonesia. I draw in particular on the discourse on FDI in this journal, the Bulletin of Indonesian Economic Studies, giving special attention to contributions by this journal to the international literature on FDI and its impact. The article demonstrates that the relation between FDI and economic growth has been less straightforward in Indonesia than elsewhere in Southeast Asia. Although FDI has grown in a restrictive investment climate, on occasion it has failed to do so despite more liberal conditions. This may be attributed to the sustained role of natural resources in determining Indonesia's attractiveness as a host country of FDI.     

China＇s Pattern of Growth： Moving to Sustainability and Reducing Inequality

I. Introduction China’s gross domestic product (GDP) growth has averaged 9.4 percent per annum since1978. As a result of this impressive growth, millions of people were lifted out of poverty. Economic reforms implemented over the last 25 years have certainly been instrumental in the remarkable growth performance, leading to higher productivity growth than in the pre- reform period. Nevertheless, it is widely agreed that China’s growth during this period has been resource intensive, drawing…     

Towards a European urban policy

In the face of some opposition from those who plead subsidiarity as the central plank of European policies, the emergence of an urban dimension to European policies has been significant in the last five years. Now, reinforced by a research base, with the European Parliament and the Committee of the Regions providing a political route to influence, and with a modest programme of experimentation in urban projects in progress, the “urban” appears genuinely fixed on the political agenda of Europe. From a UK perspective the substance of the programmes is limited; small in scale and following many of the lines established within City Challenge or the Urban Partnerships, the new European urban initiatives are substantively modest and marginal. Much more important is the symbolic importance of a European urban perspective. This gives impetus to the policy debate at both European and national levels with the Commission's Community Initiative directing attention not simply to growing polarisation, marginalisation and exclusion in cities, but also to issues of urban fiscal crisis — the interaction of heavy expenditure needs with inadequate tax or grant base. Increasingly fierce competition between cities for investment and growth, with both Brussels and nation states involved as regulators and/or co-competitors is certain to exacerbate inter urban differentials and to reinforce the salience of questions of social exclusion and urban fiscal crisis.     

Urban Shopping Patterns in Indonesia and Their Implications for Small Farmers

In developing countries, the expansion of supermarkets and other modern food retailers has raised concerns about the potential impact on traditional retailers and fruit and vegetable farmers. Will small farmers, in particular, be squeezed out of this growing, remunerative market by the quality standards imposed by supermarkets? In an attempt to answer this question, we analyse data from a stratified random sample of 1,180 urban households in Indonesia. We find that only a small share of fruits and vegetables are purchased from modern outlets, even among high-income urban households. On the basis of the relation between income and shopping patterns in our data, we project that even after 15 years of income growth, supermarkets will account for less than 40% of urban food spending. The impact of supermarket standards on small farmers may be less dramatic than has been feared.     

Korean Investment in Indonesia: Survey and Appraisal

This article offers the first systematic survey of Korean direct investment in Indonesia as it has developed during the past three decades. The survey includes a chronology and an overview based on macro level statistics. An assessment of the potential contribution of Korean direct investment to the Indonesian economy draws on both a corporate profile embracing a large number of companies and evidence from a small sample of selected individual firms. The article stresses a fundamental diversity in Korean investment in Indonesia that translates as potential benefits in terms of both new employment creation and technology transfers.     

Top incomes and income polarisation in China

Income polarisation is normally measured using household survey data, but such data often provide insufficient coverage of top incomes. This paper combines data from the Chinese Household Income Project and Top Incomes in China databases for 2002, 2013, and 2018 to study the trends in, reasons for, and heterogeneity of income polarisation in China between 2002 and 2018. Our main findings are as follows. (1) Introducing external top-income data increases the estimated level of polarisation in each of the three surveyed years, but polarisation trends are not affected. (2) Polarisation increases significantly between 2002 and 2013, due to a rise in polarisation among poor residents. Polarisation remains stable between 2013 and 2018, due to the expansion of the middle-income group; the convergence to the middle of the distribution is attributable mainly to the poor, rather than the rich. (3) In 2018, levels of polarisation are higher among male, well educated, and urban residents than among female, less educated, and rural residents, respectively.     

The Demography of Indonesia in Comparative Perspective

Having reduced its fertility rate over the past 40 years, Indonesia has reached a new demographic crossroad. Its fertility rate is now around 2.5 births per woman, which, if sustained, would add substantial numbers to Indonesia's population in the future. There are concerns within Indonesia that the present level of population growth is an obstacle to continued economic development and, accordingly, that fertility should be reduced to the replacement level of 2.1 births per woman as soon as possible. Yet a comparative perspective indicates that countries such as Singapore, Japan, and Thailand are concerned about the effects that their very low rates of fertility are having on their labour forces and their rates of population ageing. This article suggests that with the right policy settings Indonesia can avoid this outcome yet continue to reduce its fertility. It discusses the implications of Indonesia's population growth and distribution for its economy, as well as the poor quality of demographic data.     

农村公共投资、居民消费与经济增长——一个博弈论的分析框架

本文在博弈论框架内讨论了公共投资与农村经济增长的关系.本文认为,政府公共投资与农村居民消费的博弈过程是推动农村经济增长的重要途径.由于博弈均衡水平和稳定性状受环境参数影响较大,公共投资与农村经济增长的相互推动作用并非是无条件的,只有那些经济系统处于发散的农村地区,公共投资与农村经济增长的相互推动作用才会显现.此外,本文还得出了统筹城乡和区域经济发展具有强化公共投资和农村经济增长相互作用的结论,并进行了相应的讨论.     

Foreign direct investment and growth in East Asia: lessons for Indonesia

Foreign direct investment (FDI) has been important in the growth and global integration of developing economies. Both Northeast and Southeast Asia, especially the latter, have been part of this development, with increasing inflows of FDI and greater foreign participation in local economies. However, Indonesia has been an outlier within the region. Inflows of FDI have been lower to Indonesia than to other countries, especially in manufacturing, and they have been lower than could be expected from Indonesia's size, population and other country characteristics. We show that the inflows that have occurred have benefited Indonesia, and use the East Asian experience to identify measures that are likely to increase these flows. A relatively poor business environment, inefficient government institutions, low levels of education and poor infrastructure all seem to be important explanations for the low inflows of FDI to Indonesia.     

公共基础设施与城市聚集经济研究——基于上海市的数据分析

国内城市研究中，缺乏包含公共设施和聚集经济的综合研究文献。文章选取上海市1985—2008年工业企业的统计数据，利用生产函数方法对上海市聚集经济进行了研究和分析。结果表明：城市公共基础设施投入水平对城市聚集经济和生产率增长有着正效应。     

The growth of urban centres in Java since 1961

The rate of urban population growth from 1961 to 1980 in the larger cities of Java, Indonesia, is examined using data from the 1980 census. The author notes that these data disregard boundary changes, and he attempts to take these changes into account by presenting revised rates of growth for various major urban centers in Java. The differences among the growth trends of the national capital, the three provincial capitals, and the remaining urban centers are discussed.     

Is Being Stuck with a Five Percent Growth Rate a New Normal for Indonesia?

Indonesia’s economic growth over the past three years has been stuck at approximately 5% annually, despite a changing global environment and the Indonesian government’s efforts to boost growth. This paper asks whether this level of growth is a new normal for Indonesia—i.e. do government efforts and the global environment matter, or will the country’s economic growth remain at around 5% annually. If private consumption, the major component of GDP, continues to grow at its current level and inflation is controlled, this paper concludes that Indonesia might maintain its current annual growth rate of 5% for several more years. The probability of higher growth, however, is not promising. Lower growth seems more likely. To ensure the current level of economic growth will be sustained in the foreseeable future, this paper recommends stricter economic reforms to allow larger and more productive capital investments; more aggressive management of exchange rates to improve the country’s competitiveness; a more effective fiscal space to support improvements to needed infrastructure by developing innovation to increase revenue; a reduced energy subsidy; and a more flexible upper bound of deficit. Effective programs to improve the country’s human capital and innovation are crucial.     

PE法律问题新研究——以PE不同组织形式税收优劣分析为视角

随着中国经济持续快速增长和国内资本市场的逐步完善,私募股权投资(即通常所言PE)在国内市场得到了迅猛发展。在此背景下,国家出台了一系列法律法规和政策文件支持PE投资的成长壮大。本文在对PE投资基本法律知识及国内外学者的研究状况简要梳理的前提下,剖析了国内对PE投资不同组织形式的学说见解,重点对PE投资不同组织形式的税收优劣问题提出自己新的研究观点,纠正学理界一直以来的错误论断,旨在对保证PE投资在国内的发展和完善有所帮助。     

多元化的城市交通基础设施融资

城市的发展需要一个良好的交通环境,城市交通基础设施建设需要投入大量资金,然而城市交通基础设施建设的资金缺乏、融资比较困难。本文就城市交通基础设施融资的问题进行了分析,并提出了城市交通基础设施融资的四种途径:PPPs、BOT项目融资、民间投资、金融市场。通过多渠道融资,完善城市交通基础设施建设,提高城市交通运输能力,促进城市经济健康发展。