Development Banking Approach to the Development of Regions and Cities*

The selection of cities and regions for priority development should not be determined by technocrats in the central government as has been widely practised in the past, but instead, should be made on the basis of the wishes of the local units. A national system which encourages responsible local governments to undertake development projects without ordinary budget constraints but with responsibility should be developed to achieve this objective. The establishment of a local development bank meets this need. It will help local governments to become motivated in development efforts, to develop planning, implementation and management capabilities, and to learn the importance of cost recovery.     

Economic Sentiments and Money Demand Stability in the CEECs

Open Economies Review - This paper aims at building a money demand function that takes account of the heterogeneities of the Central and Eastern European Countries (CEECs) in the context of the...     

General equilibrium analysis of the benefits of large transportation improvements

This paper considers three benefit measures of a large transportation improvement in a general equilibrium framework, i.e., the Marshall-Dupuit consumer's surplus, the. compensating variation, and the compensating surplus. First, we examine whether or not the measures can be reduced to the area to the left of a suitably defined transportation demand curve. Second, the measures are expressed as functions of various price and income elasticities which can be empirically estimated and we analyze factors affecting the magnitudes of the general equilibrium benefit measures. Third, the general equilibrium measures are compared with the partial equilibrium measures.     

THE VERY RAPID INCREASE OF JAPANESE TOURISTS ABROAD AND THE ROLE OF NATIONAL WEALTH

The strong performance of the Japanese economy, rising stock and land prices in Japan, as well as the strong yen, have prompted Japanese to travel abroad in ever increasing numbers in recent years. Despite several obstacles against growth, such as limited vacation time for employees of Japanese corporations, relatively expensive airline tickets, capacity limitations of international airports in Japan, booming resort development in Japan itself, and imposed constraints on Japanese direct investment abroad, Japanese travelers abroad, the majority of whom are tourists, increased from less than five million in 1985 to almost 10 million in 1989. The traditional demand function based on income and price may not explain all of the growth of Japanese overseas tourism, since some of the increase in Japanese travelers may stem from increases in expected future income based on increased wealth. This wealth effect hypothesis is tested using a log-linear regression model. It is found that wealth is a better predictor of overseas tourism levels than income. The effect of wealth increases on overseas tourism is also found to have a lag time of about one year. For this reason, it is proposed that the slowing in the Japanese economy this year will negatively impact Japanese overseas tourism next year.     

Housing as a Means of Sustainable Economic Recovery in Southeast Asia

This paper addresses the economic crisis in Southeast Asia as it effects the housing sector there. Our basic argument is that the lower end of the formal housing market sector (worker housing) provides the best opportunity to restore productive employment activity while addressing basic housing needs. We call for a range of policy measures to support this outcome, based in part on the recent experience in Japan with declining real estate markets. The policies include limited subsidies, guarantees and insurance for housing loans, along with a downward indexing of housing loans, strategic infrastructure investment and promotion of local building materials. These measures are necessary under the current circumstances of deficient aggregate demand. The key is to target demand increments where they are most likely to meet the basic need for shelter while generating productive market-based activity.     

Is education important in assessing the impact of institutions on economic growth in emerging economies?

ABSTRACT

In this article, we empirically revise the hypothesis that institutions cause economic growth for emerging countries starting from a theoretical model. Our sample consists of 21 countries covering different zones: European Emerging, Asia Pacific Emerging, Latin America, Middle-East and Africa while the status advanced versus secondary emerging countries based on FTSE (Financial Times Stock Exchange) classification is accounted for. The period analysed is 1995–2014. The methodology is based on System GMM estimator of Arellano-Bover and Blundell-Bond for dynamic panel data. Empirical findings suggest that only variables such as voice and accountability and government effectiveness have a significant positive impact on economic growth rates of the analysed countries. In the presence of control variables, i.e. trade and government final consumption, results are robust. Results remain robust for countries that have a high level of government expenditure on tertiary education which proves the role of education in assessing the impact of institutions on economic growth.     

AN ECONOMIC POLICY HYPOTHESIS OF METROPOLITAN GROWTH CYCLES: A Reflection on the Recent Rejuvenation of Tokyo*

Rejecting the simplistic life-cycle hypothesis of cities put forth by Klassen and Paelinck, this paper advances a new hypothesis for the cyclical movements of urban growth that have taken place on a world-wide scale. The recent rejuvenation of major industrialized cities is largely attributed to the shift in the government's economic policies toward a smaller government, supported by the existence of economies of scale in large cities. The paper closely examines Tokyo's recent rejuvenation and shows how the government's conservative economic policies of the 1980's helped reverse the declining trend of the previous decade.     

LAND TAXATION AND ITS IMPACT ON LAND PRICE: The Case of Japan in the 1990s

The multifold increases in land prices in Tokyo, at first, and in other major cities of Japan, later, during the last half of the 1980s brought forth government proposals to strengthen the land holding taxes which were very low in the past. This paper analyzes the background of these developments as well as their rationales, and looks at possible consequences of planned increases in land holding taxes. It is argued that the rivalry between the Ministry of Finance and the Ministry of Local Autonomy is leading to a situation in which unexpectedly heavy land holding taxes will be imposed in the near future, lowering the price of land to much less than half of what it was in the past.