Asian Economic Journal最新文献

International competition over sophisticated tech is a modern feature of great power rivalry. Yet the automation delivered by this tech is a key source of rising inequality. While policy motivations stem primarily from great power political and defense competition, the automation has consequences for wider economic performance. We examine global economic consequences, using a six-region global macro model with multiple households, under Rawlsian, Benthamite, capital friendly, or GDP maximizing policy criteria. Tech drives are shown to deliver higher capital returns and more growth, and therefore to represent dominant strategies under all but a Rawlsian criterion, despite their exacerbation of inequality and low-skilled poverty. We then consider Gini-reducing fiscal interventions. These are shown to have few international spill-over effects and to be domestically attractive only under the Rawlsian criterion.

As the population rapidly ages, Housing Reverse Mortgages (HRMs) have emerged as a valuable addition to the multilevel pension insurance system, helping to alleviate the pressure on pension financing. However, the HRM market in China faces challenges due to the limited financial literacy among middle-aged and elderly residents; there is a “cognitive bias” toward understanding the mechanisms and benefits of HRMs leading to “insufficient effective demand.” This study empirically investigates the likelihood of changing the “demand willingness” for an HRM through a scenario-simulation experiment focused on HRM-related information disclosure. The findings include: (1) Up to 46.78% of the subjects' attitudes toward adopting HRMs shifted from “unwilling” to “willing” after receiving disclosed information, indicating that cognitive bias significantly impacts the insufficient effective demand for these housing products. The information disclosure experiment can correct the inadequate financial literacy to a certain extent, thereby significantly enhancing the potential demand willingness. (2) After the experiment, subjects with strong motives to bequeath their property to family members (referred to as “strong bequest motives”) significantly changed their willingness to adopt HRMs (“demand willingness”). This suggests that a clear, comprehensive promotional strategy can better align middle-aged and elderly residents' perceptions of the role of HRMs in protecting inheritances, reducing the impact of bequest-related considerations on their financial decisions. (3) Participants initially exhibiting lower financial literacy also demonstrated notable shifts in their demand willingness postexperiment. Access to easily understood, high-quality information appears to help older individuals recognize the potential benefits of HRMs, mitigating the negative effects of cognitive limitations on their decision-making. These findings highlight the importance of enhancing financial literacy and promoting a better understanding of HRMs among middle-aged and elderly individuals, which may effectively manage the challenges associated with an aging population and the pressures on pension financing.

Understanding energy demand patterns in the residential sector is crucial for improving energy efficiency through demand-side management. Load curve classification is a useful method for analyzing energy demand patterns. In this paper, we employ a hidden Markov model (HMM)-based classification to residential load curves in South Korea. We also investigate how the number of hidden states affects classification performance by allowing HMM to train with a different number of hidden states for each class. We compare our HMM-based method with several state-of-the-art models and find that it outperforms other competing models in multiple datasets. Additionally, we use the fitted HMM model to make inferences about the load curves, gaining deeper insights into energy demand patterns.

Understanding the interaction between national income GDP expenditure components is a key part of the study of the macroeconomics of any country. The general aim of this study is to explore this interaction between the GDP expenditure components in the time–frequency domain for the country of Japan, obtain some stylized facts and then compare them with those of the United States. The main result shows that the cyclical interactions between consumption and investment are typical of an “accelerator” effect and operate at several different frequencies, but that the several different cycles evident in the data phase out in the 1990s, once secular stagnation started to take hold. We hypothesize that Japan's investment drivers then changed to be dependent on the external sector by the 2000s. A secondary result is that Japanese fiscal policy appears to have been largely ineffective in terms of creating cyclical interactions with other GDP components.

Suwanprasert, W. (2024). The economic aftermath of Thailand's 2014 military coup: Evidence from the synthetic control method. Asian Economic Journal, 38(2), 256–283. https://doi.org/10.1111/asej.12333

In the first sentence of the abstract, the statement “This paper study the effects of Thailand's 2014 military coup on Thailand's economy using the control method to create synthetic Thailand, which represents hypothetical Thailand had the 2014 coup not occurred.” was incorrect.

This should have read: “This paper studies the effects of Thailand's 2014 military coup on Thailand's economy using the synthetic control method to create synthetic Thailand, which represents hypothetical Thailand had the 2014 coup not occurred.”

We apologize for this error.

Using panel data from 2012 to 2018, this article investigates the long-term impact of household debt on household consumption, which is very important to the sustainable development of economy. The result shows that total household debt has a significant crowding-out impact on long-term household consumption, whereas nonhousing debt has no significant effect on it. In addition, we also find that the debt of high-asset families has a weaker impact on long-term household consumption; the debt of rural families, however, has a greater crowding-out effect, which means that increasing rural families' leverage will have a greater negative impact on household consumption. Finally, household debt's negative effect on long-term consumption was not found in older families, whereas it is found at significant level in middle-aged families. The above results have important implications for China's policy to stimulate consumption and promote sustainable economic development.

This paper study the effects of Thailand's 2014 military coup on Thailand's economy using the control method to create synthetic Thailand, which represents hypothetical Thailand had the 2014 coup not occurred. The empirical findings reveal no statistically significant effects on key economic variables such as gross domestic product, unemployment, military expenditure, and income inequality. Contrary to previous research, military expenditures did not increase following the coup. Supporters of the coup may interpret these results as evidence that the coup had no negative effects on the economy. At the same time, critics may argue that the coup did not lead to improved economic outcomes compared with the politically unstable precoup period, thus perpetuating a state of national stagnation.

This article examines the main drivers behind changes in mean earnings and earnings inequality in Indonesia between 2001/2002 (data for 2001 and 2002 are combined) and 2018. During this period, there was an increase in workers' education level, average age, job quality and mean earnings. More women participated in the labor market, but women earn lower wages than men, therefore mean earnings fell. For the overall period, a decline in educational returns at all levels of education contributed negatively to earnings. Narrowing wage premia across provinces contributed to the increase in mean earnings. Indonesia's Gini index rose during this period, driven by the education distribution effect and the spatial location (place of residence) premium effect. Although improvement in education levels increased mean earnings, this was inequality-increasing due to the “paradox of progress” (exponential wage returns to education). There is a need for complementary policies to attenuate the inequality-increasing education and spatial location effects as well as gender wage gap.

Using a global dynamic general equilibrium model with foreign direct investment (FDI) and technology capital, this paper finds that the EU–China Comprehensive Agreement on Investment (CAI) could bring modest but nonnegligible benefits to both sides. Under an illustrative scenario in which the CAI increases the degree of openness to bilateral FDI by 10%, the EU's FDI to China could rise by a factor of 3–4 and China's FDI to the EU by a factor of 3. These would generate a gain in the steady-state gross national product (GNP) of 0.23% for China and 0.73% for the EU. The cumulative household welfare gain in the present value term is equivalent to 0.36% and 0.13% of GNP annually for China and the EU, respectively.

This study estimates a medium-scale dynamic stochastic general equilibrium model for the Thai economy to evaluate the impact of the COVID-19 pandemic containment policy on key macroeconomic aggregates. The shock to labor supply is considered as the main transmission channel. The paper discussed the role of monetary policy in regard to economic recovery and also identified the dominant shocks driving the business cycle. Thai quarterly series from 2011Q1 to 2021Q2 is used for the Bayesian estimation of the model. Though the pandemic shock caused a sharp decline in output, consumption and investment, the results suggest a fast recovery in the growth rates of the variables in about 2.5 years. At the same time, the dominant shocks that account for output variation in the medium to long term are investment, labor supply and productivity shocks. Monetary policy is effective in shortening the recovery due to its impact on private investment. The key drivers of Thai household consumption in the long run are investment, labor supply and productivity shocks. On average, the investment shock appears to be the key driver of the business cycle at all horizons.