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1. Technological Innovation and the Development of the Fuel Cell Electric Vehicle Industry Based on Patent Value Analysis

Author:
Yanfei Li, Jia Zhao, and Jianjun Yan
Publication Date:
06-2023
Content Type:
Working Paper
Institution:
Economic Research Institute for ASEAN and East Asia (ERIA)
Abstract:
Currently, major economies are competing on the technological and industrial development of fuel cell electric vehicles (FCEVs). This paper discusses the relationship between the patent value of FCEVs and the commercialisation of this technology. First, the patent data of FCEVs are analysed, focusing on data of China, Germany, Japan, the Republic of Korea, and the United States. Then, the paper constructs the FCEV patent value index framework based on the technological value and economic value of patents. Finally, this paper conducts an empirical study to analyse the influence of patent value on the development of the FCEV industry. It is found that, under the current situation, individual patent value can significantly promote the development of the FCEV industry, whilst the gross patent value of a certain country even has a negative impact. In addition, the increase of hydrogen infrastructure, research and development expenditure, and market demand will significantly promote the development of the FCEV industry. The development level of related industries such as the battery electric vehicle industry and the reduction of environmental pollution are also significant drivers of the development of FCEVs.
Topic:
Development, Science and Technology, Innovation, Industry, and Electric Vehicles
Political Geography:
Asia

2. The Indo-Pacific Partnership and Digital Trade Rule Setting: Policy Proposals

Author:
Lurong Cheh
Publication Date:
12-2022
Content Type:
Working Paper
Institution:
Economic Research Institute for ASEAN and East Asia (ERIA)
Abstract:
The idea of the Indo-Pacific was borne from a global trend that has (re)oriented the centre of the world’s economic gravity to the East. Accelerating digital transformation to harness gains from technology are in countries’ common interests. The launch of the Indo-Pacific Economic Framework for Prosperity tends to supplement economic benefits to the Indo-Pacific. Becoming more deeply involved in the digital economy will require Indo-Pacific members to commit to new international norms on digital trade, of which trade liberalisation of electronic transmissions, free flow of data with trust, cybersecurity, and intellectual property rights protection must be prioritised.
Topic:
Development, International Trade and Finance, Regional Cooperation, and Digital Economy
Political Geography:
Asia and Indo-Pacific

3. Japan and the Regional Comprehensive Economic Partnership (RCEP)

Author:
Mie Oba
Publication Date:
10-2022
Content Type:
Working Paper
Institution:
Economic Research Institute for ASEAN and East Asia (ERIA)
Abstract:
This paper aims to clarify the role of Japan in the process leading up to the establishment of the Regional Comprehensive Economic Partnership (RCEP). While emphasising that respect for the centrality of the Association of Southeast Asian Nations (ASEAN) was a principle of RCEP, Japan played a leading role in the process of RCEP negotiations. For Japan, RCEP is one of the fruits of its strategy in East Asia/Asia-Pacific that began the mid-1990s to protect and increase the interests and advantages of Japanese business and retain Japan’s political leverage in the region. When substantial negotiations for RCEP began in 2013, its importance for Japan was secondary to other free trade agreements (FTAs) including the Trans-Pacific Partnership, China–Japan–Korea FTA, and Japan–European Union FTA. However, the Government of Japan and the business community had set a lot of economic and strategic goals in promoting RCEP. After the withdrawal of the United States (US) from the Trans-Pacific Partnership, RCEP was seen as an essential framework for establishing a rules-based regional order in the Indo-Pacific region. Although it was after India’s withdrawal from the RCEP negotiations, Japan further emphasised the importance of RCEP as the measure to sustain and foster the rule-based regional order and simultaneously pursued the conclusion of negotiations and the establishment of high-level rules, achieving some success. Ultimately, the havoc brought about by the coronavirus disease (COVID-19) pandemic and the sense of crisis in the traditional liberal international order caused by the intensifying strategic competition between the US and China, drove the conclusion of RCEP. RCEP will be increasingly important for economic order in Japan and Asia in the coming years. Ironically, as the strategic competition between the US and China escalates and leads to a surge in protectionism, the economic and strategic importance of RCEP – an FTA that incorporates China – is becoming more significant as a measure to counter unilateralism and protectionism. In addition, RCEP needs elements that address globalisation’s adverse effects and pitfalls, in areas such as the environment, labour rights, and a reduction in the disparity between the rich and poor.
Topic:
Development, Economics, International Trade and Finance, and Regional Cooperation
Political Geography:
Japan and Asia

4. Projecting Infrastructure Needs and the Financing Mechanism: A Review of Estimations by ADB, McKinsey, and the OECD

Author:
Fauziah Zen and Michael Regan
Publication Date:
03-2022
Content Type:
Working Paper
Institution:
Economic Research Institute for ASEAN and East Asia (ERIA)
Abstract:
How much does a country, a region, and the world need to spend on infrastructure development to fulfil demand? This question has been asked frequently because governments try to see it as a reference for budget allocation and evaluation of development progress. Since infrastructure consists of a wide range of types, qualities, and sizes, it is difficult to come up with a number that represents these variants. Several widely cited attempts have been made to provide estimations of infrastructure needs. This paper aims to assess the features, scope, methods, and suggested financing mechanism of the projections made by the Asian Development Bank (2017), the Organisation for Economic Co-operation and Development (2017), and the McKinsey Global Institute (2016). It is not meant to focus on the limitations of these projections, but to understand the process used to put these estimates together and the extent to which they provide comparative information.
Topic:
Development, Economics, Emerging Markets, and Infrastructure
Political Geography:
Asia and ASEAN

5. Implicit Subsidies for Infrastructure and Their Implications for Contingent Liabilities in Selected East Asian Countries

Author:
Astrid Dita and Sandy Maulana
Publication Date:
03-2022
Content Type:
Working Paper
Institution:
Economic Research Institute for ASEAN and East Asia (ERIA)
Abstract:
A government's investment decision for infrastructure development is a form of budget commitment which results in direct liabilities and possible contingent liabilities. The latter is often overlooked when the project preparation is weak where potential risks are insufficiently identified and mitigated and its impact on budget sustainability may worsen in the absence of sound surveillance. Infrastructure projects may thus lead to unmitigated fiscal risk without proper investment decision-making and monitoring framework particularly in the presence of less-than-mature fiscal systems and low public investment management capacity (e.g. as demonstrated by the inability to develop sound project business cases or distinguish project financing from funding issues).
Topic:
Development, Infrastructure, Governance, and Investment
Political Geography:
Asia and ASEAN

6. The Link Between Global Value Chain Activity and Local Human Capital: Evidence from Indonesia’s Manufacturing Sector

Author:
Rashesh Shrestha and Deborah Winkler
Publication Date:
02-2021
Content Type:
Research Paper
Institution:
Economic Research Institute for ASEAN and East Asia (ERIA)
Abstract:
For developing countries, participation in global value chains (GVCs) provides an opportunity to expand domestic human capital. Since GVC firms require qualified workers to meet high production standards, they have an incentive to invest directly in their workers’ skills or to raise the demand for skilled workers, which indirectly creates an incentive for workers to enrol in vocational education. This paper explores the relationship between GVC activity and workers’ skills in Indonesia. It combines National Labor Force Survey (SAKERNAS) data with the Large/Medium Industry Survey (IBS) to construct a pooled cross-sectional data set of Indonesian manufacturing workers which takes into account measures of GVC activity at the district-sector-year level. The findings suggest that higher GVC activity in a worker’s district-sector-year is linked to a higher likelihood of vocational education of individual workers. A separate panel data analysis at the district level confirms the positive relationship between GVC activity and human capital. Finally, the results indicate that the wage premium for vocational education is higher in districts with greater intensity of GVC activity.
Topic:
Development, Education, Training, Manufacturing, Industry, and Global Value Chains
Political Geography:
Indonesia, Asia, and Southeast Asia

7. Understanding Quality Energy-Related Infrastructure Development in the Mekong Subregion: Key Drivers and Policy Implications

Author:
Han Phoumin, Sopheak Meas, and Hatda Pich An
Publication Date:
03-2021
Content Type:
Research Paper
Institution:
Economic Research Institute for ASEAN and East Asia (ERIA)
Abstract:
Many players have supported infrastructure development in the Mekong Subregion, bridging the missing links in Southeast Asia. While the influx of energy-related infrastructure development investments to the region has improved the livelihoods of millions of people on the one hand, it has brought about a myriad of challenges to the wider region in guiding investments for quality infrastructure and for promoting a low-carbon economy, and energy access and affordability, on the other hand. Besides reviewing key regional initiatives for infrastructure investment and development, this paper examines energy demand and supply, and forecasts energy consumption in the subregion during 2017–2050 using energy modelling scenario analysis. The study found that to satisfy growing energy demand in the subregion, huge power generation infrastructure investment, estimated at around $190 billion–$220 billion, is necessary between 2017 and 2050 and that such an investment will need to be guided by appropriate policy. We argue that without redesigning energy policy towards high-quality energy infrastructure, it is very likely that the increasing use of coal upon which the region greatly depends will lead to the widespread construction of coal-fired power plants, which could result in increased greenhouse gas and carbon dioxide emissions.
Topic:
Development, Energy Policy, Infrastructure, Renewable Energy, and Carbon Emissions
Political Geography:
China, Asia, Vietnam, Burma, Cambodia, Thailand, Southeast Asia, Laos, and Myanmar

8. Aviation Market Development in the New Normal Post the COVID-19 Pandemic: An Analysis of Air Connectivity and Business Travel

Author:
Xiaowen Fu, David A. Hensher, Nicole T. T. Chen, and Junbiao Su
Publication Date:
09-2021
Content Type:
Research Paper
Institution:
Economic Research Institute for ASEAN and East Asia (ERIA)
Abstract:
This study quantifies the effects introduced by the COVID-19 pandemic on air connectivity and passenger travel behaviour. Our analysis suggests that the pandemic has led to significant connectivity loss at all airports, especially at large hubs and tourism destinations. Low-cost carriers’ operations at these airports, whose main targets are price-sensitive, non-business travellers, have been significantly reduced, too. There is preliminary evidence that network carriers at hub airports played more important roles amid the pandemic, likely due to the benefits associated with their hub-and-spoke networks. Connectivity losses at the smallest airports tended to be temporary and limited. These airports had limited aviation services to start with and, thus, it was not too costly to maintain the minimum connectivity. Empirical results obtained from a passenger preference study indicate that traveller subgroups are impacted in different ways. When there is no online meeting option, nearly 80% of the respondents prefer, and are willing to pay for, pandemic control measures. These ‘pro-control’ passengers perceive such measures and the associated high costs/fares as valuable and necessary to lower the health-related risks during air travel. When there is an online meeting option, the share of such passengers decreases to 44.5%, with the remaining 55.5% exhibiting disutility for the increased price and time associated with pandemic control measures. The average willingness-to-pay for pandemic control measures decreases significantly, whereas the value of time saved at health checkpoints increases significantly. The aviation industry thus faces a ‘double-hit’ problem: operation costs will increase due to pandemic control measures, and the resultant inconvenience and extra time and costs further reduce travel demand. Unlike previous short pandemics, business travel is likely to suffer with an extended decline until the pandemic is fully controlled. These results call for financial and operational support for aviation services, especially at major airports and tourism destinations. Because these large airports are expected to be profitable post the pandemic, they may resort to low-cost finance from the capital market in the short term. Because the value of time saved at checkpoints is very high, it is more important for government agencies to make the pandemic control and health measures efficient and smooth. For operations such as vaccination records, stakeholders in different countries should cooperate to facilitate seamless control and pleasant air travel experiences.
Topic:
Development, Financial Markets, Business, Public Health, Pandemic, COVID-19, and Travel
Political Geography:
Asia and Southeast Asia

9. China's Ties with Southeast Asia : From Green Shoots to Sustained Recovery

Author:
Kensuke Tanaka
Publication Date:
01-2021
Content Type:
Policy Brief
Institution:
Economic Research Institute for ASEAN and East Asia (ERIA)
Abstract:
China's rebound happened relatively quickly owing to a large extent to timely macroeconomic policy responses to the crisis. Lagging somewhat behind China, most Southeast Asian countries have now entered the transition from recession to recovery. Some export-dependent Southeast Asian countries shifted their export destination to China to benefit from its early recovery. This switch of export destination to China illustrates China's important role in leading the recovery of the region. Enhancing regional macroeconomic co-operation would help reduce vulnerability of the region and ensure a sustained recovery. Regional macroeconomic co-operation remains at an early stage in Southeast Asia, but possibilities for further co-operation should be explored.
Topic:
Development, Economics, International Cooperation, International Trade and Finance, and Economic Recovery
Political Geography:
China, Asia, and Southeast Asia

10. Enhancing Inter-Firm Linkages through Clusters and Digitalisation for Productivity Growth

Author:
Vo Tri Tranh
Publication Date:
01-2020
Content Type:
Working Paper
Institution:
Economic Research Institute for ASEAN and East Asia (ERIA)
Abstract:
This paper examines the policies for industrial cluster development in Viet Nam. The first export processing zone was established in 1991. Since 1994, Viet Nam has focused more on developing domestic productive capacity and thus various types of industrial estates were established. The key actors in industrial cluster policy are the government, Prime Minister, ministries, provincial people’s committees, and management boards of industrial and economic zones. The choice of industrial estate is often determined by factors such as geographic location, land, labour, infrastructure, industry, business environment, and incentives. Viet Nam has provided various incentives to industrial estates of various types, but the scope and extent of preferential policy support for firms in general and those operating in industrial and economic zones are rather modest. The industrial estates have contributed significantly to attracting foreign direct investment, to exports, to productivity improvement, etc. Looking forward, Viet Nam needs further efforts on industrial cluster development, including development of statistics, analysis of cluster policy impacts, and provision of FTA-consistent incentives.
Topic:
Development, Industrial Policy, Governance, Leadership, and Management
Political Geography:
Asia and Vietnam

11. Foreign Direct Investment and Labour Market Dynamics in a Developing Country: Evidence from Indonesian Plant-Level Data

Author:
Toshiyuki Matsuura and Hisamitsu Saito
Publication Date:
02-2020
Content Type:
Working Paper
Institution:
Economic Research Institute for ASEAN and East Asia (ERIA)
Abstract:
This study examines the impact of inward foreign direct investment on the wages and employment of skilled and unskilled workers in Indonesian manufacturing plants. Entry of multinational enterprises affects local labour markets through spillovers as well as labour and product market competition. Our results show that spillovers increase the labour demand of local plants for unskilled workers, but increased wages due to severe labour market competition reduce the demand for skilled workers. We also find that product market competition causes resource reallocation from low- to high-productivity plants. Thus, attracting inward foreign direct investment effectively enhances aggregate productivity growth, but may retard the transition to skill-intensive production in Indonesian manufacturing.
Topic:
Development, Foreign Direct Investment, Manufacturing, and Labor Market
Political Geography:
Indonesia and Asia

12. Technology Imports and Employment in Developing Countries: Evidence from Viet Nam

Author:
Thu Thu Vu and Duc Anh Dang
Publication Date:
08-2020
Content Type:
Working Paper
Institution:
Economic Research Institute for ASEAN and East Asia (ERIA)
Abstract:
Advanced machines and technology replace workers through automation. However, capital–labour substitution need not reduce aggregate labour demand, as it induces simultaneous contrasting effects within industries. To explore these effects, we examine the relationship between employment in Vietnamese manufacturing firms and imported capital goods in 2011–2017. To solve the problem of potential endogeneity and measurement errors, we used Association of Southeast Asian Nations (ASEAN) imported capital goods as an instrument variable for imported capital goods in Viet Nam. We found that imported capital goods do not displace employment and even increase employment and labour productivity. The impacts of imported advanced technology are more pronounced in large firms. More imported technology increases labour productivity in state-owned enterprises and the number of workers in large firms and firms in industrial zones. However, the increase in the level of employment is lower in industries and firms intensively using machines.
Topic:
Development, Science and Technology, Employment, and Imports
Political Geography:
Asia and Vietnam

13. The Effects of Financial Inclusion on Development Outcomes: New Insights from ASEAN and East Asian Countries

Author:
Rajabrata Banerjee, Ronald Donato, and Admasu Afsaw Maruta
Publication Date:
09-2020
Content Type:
Working Paper
Institution:
Economic Research Institute for ASEAN and East Asia (ERIA)
Abstract:
This study empirically examines the effects of financial inclusion on economic development, – economic growth, education, health, and income inequality – in 20 Asian countries in the period 2004-2015. The financial inclusion index at an aggregate level is constructed using a hybrid methodology (reported in the previous paper) and we empirically examine its relationship with particular development outcomes. We then disaggregate the index into the three dimensions of financial inclusions – access, usage, and quality – and further into the top two indicators from each dimension based on principal component analysis scores (reported in the previous paper), to examine whether specific dimensions or indicators are more strongly associated with particular development outcomes than with others. Our results show that aggregate financial inclusion has a strong positive effect on all development outcomes and this effect improves for countries with lower political risk. At the dimension level, while usage is the only dimension impacting on economic growth, and access is the only dimension impacting on health outcomes, both usage and access influence education and income inequality. Moreover, the top ranked indicators in each dimension exert a far greater positive influence on development outcomes than the second highest ranked indicators. Our findings show that adopting a single blanket policy may not be appropriate to realise the full potential of financial inclusion in a less developed country. Policy prescriptions should therefore target specific dimension and indicators of financial inclusion to maximise the positive effect on development outcomes.
Topic:
Development, Health, Finance, and Fiscal Policy
Political Geography:
Asia

14. The Role of Innovation in Skill Development: Evidence from Small and Medium-Sized Enterprises in Viet Nam

Author:
Duc Anh Dang and Vuong Ahn Dang
Publication Date:
12-2020
Content Type:
Working Paper
Institution:
Economic Research Institute for ASEAN and East Asia (ERIA)
Abstract:
Using the Small and Medium Enterprise Survey in Vietnam and three proxies of innovation, we study the impact of firm innovation on on-the-job training in the manufacturing sector from 2007 through 2015. To address potential measurement errors and omitted variable problems, we use the average level of innovation in the same sector in other districts as an instrument for firms’ innovations. We find that firms provide additional training for existing workers when introducing new technology, and high-value-added firms provide additional training for existing workers. Moreover, government assistance may not be the main reason that encourages firms to provide training. The results also show that firms hire more skilled workers when implementing innovations.
Topic:
Development, Training, Innovation, and Skilled Labor
Political Geography:
Asia and Vietnam

15. Education and Human Capital Development to Strengthen R & D Capacity in ASEAN

Author:
Tereso S. Tullao Jr. and Christopher James Cabuay
Publication Date:
05-2014
Content Type:
Policy Brief
Institution:
Economic Research Institute for ASEAN and East Asia (ERIA)
Abstract:
This Policy Brief raises some policy issues regarding the capacity of the ASEAN region's education system in producing knowledge capital as it looks into the opportunities and challenges faced by the sector. This is critical for ASEAN to enable it to attain its quest to be a base for innovation. Among the issues that ASEAN has to confront in achieving this goal relate to the development of financing schemes for various types of education, improvement in the level of investments in research and development, and revisit of the way teaching is conducted in the 21st century, especially in certain disciplines crucial to engendering innovation for growth and development.
Topic:
Development, Education, Research, Economic Growth, Human Capital, and Innovation
Political Geography:
Asia and Southeast Asia

16. Delivering Results in Standards and Conformance in ASEAN: the Critical Roles of Institutional Strenghthening and the Private Sector

Author:
Simon Pettman
Publication Date:
08-2014
Content Type:
Policy Brief
Institution:
Economic Research Institute for ASEAN and East Asia (ERIA)
Abstract:
Addressing technical barriers to trade is a key priority of ASEAN as part of trade facilitation in achieving an integrated economy under the ASEAN Economic Community in 2015 and in building an effective and competitive Economic Community beyond 2015. Standards and Conformance assessment measures, while seeking to ensure quality and safety of products for consumers, should not become barriers to trade across the region as ASEAN liberalises its trading regime. A delicate balance needs to be achieved between the two to build a thriving economic region. ASEAN has been working towards achieving standards harmonisation in its priority sectors of integration and bringing about regulatory convergence, taking into account the diversities in its ten member states. More, however, needs to be done and as this Policy Brief shows, the roles of institutional strengthening and the private sector are critical in this task.
Topic:
Development, Privatization, Regional Integration, Institutions, and Private Sector
Political Geography:
Asia and Southeast Asia

17. Stimulating Innovation in ASEAN Institutional Support, R&D Activity and Intellectual Property Rights

Author:
Rajah Tasiah
Publication Date:
08-2014
Content Type:
Policy Brief
Institution:
Economic Research Institute for ASEAN and East Asia (ERIA)
Abstract:
The Policy Brief suggests initiatives that poorer ASEAN member governments should take to stimulate technological upgrading of firms at the bottom with a focus on innovation, and discusses the governance framework of intellectual property rights (IPRs) in ASEAN. With an emphasis on technology as the driver of economic growth, typologies of taxonomies and trajectories are used to evolve a policy framework to coordinate the relationship between macro-institutions, meso-organizations and micro-agents (firms) for ASEAN members to transform from developing nations to join Singapore as developed nations. Recognizing the varying capacities of ASEAN members, the paper recommends that a common platform of IPRs be developed with the more developed members assisting the least developed ASEAN members to quicken the development of a technologically more egalitarian region.
Topic:
Development, Science and Technology, Intellectual Property/Copyright, Research, and Innovation
Political Geography:
Asia and Southeast Asia

18. Dawei Revisited: Reaffirmation of the importance of the project in the era of reforms in Myanmar

Author:
Ikumo Isono and Satoru Kumagai
Publication Date:
05-2013
Content Type:
Policy Brief
Institution:
Economic Research Institute for ASEAN and East Asia (ERIA)
Abstract:
Myanmar has entered a new era of all-round reforms. Donors and foreign investors are mainly interested in Yangon, while there has been a delay in the Dawei deep sea project, the Dawei Special Economic Zone project and the road connection to Thailand. The change in circumstances poses a question about whether the Dawei project is still needed in the era of a reforming Myanmar. Our geographical simulation analysis clearly shows that the Dawei project has significant additional benefit for the whole Mekong region and points out the importance of international cooperation.
Topic:
Development, Economics, International Cooperation, Reform, and Investment
Political Geography:
Asia, Burma, and Myanmar

19. The Economic Transition in Myanmar: Towards Inclusive, People Centered and Sustainable Economic Growth

Author:
Anita Prakash
Publication Date:
08-2013
Content Type:
Policy Brief
Institution:
Economic Research Institute for ASEAN and East Asia (ERIA)
Abstract:
Myanmar has embarked on an ambitious program of sweeping reforms to end its isolation and integrate its economy with the global system. In this reform period, Myanmar faces the challenge to remain on the course ofreforms and openness while pursuing its economic growth. The Challenges of this transition can be met with a development model which is inclusive, people centered and sustainable.
Topic:
Civil Society, Development, Economics, Reform, Economic Growth, and Sustainability
Political Geography:
Asia, Burma, and Myanmar

20. Comprehensive Asia Development Plan and Beyond -Growth Strategies for More Prosperous and Equitable East Asia

Author:
Takeshi Fujimoto, Shochiro Hara, and Fukunari Kimura
Publication Date:
10-2010
Content Type:
Policy Brief
Institution:
Economic Research Institute for ASEAN and East Asia (ERIA)
Abstract:
Let's dream of our bright and prosperous future. In the year of 2020, sixteen East Asia Summit (EAS) member countries can reach doubled per capita income compared with their income level in 2008 with proper policy guidance; eight countries may join developed countries with per capita income exceeding US$10,000, five countries could enjoy the status of newly industrialized countries with per capita income between US$3,000 and US$10,000, and three countries would have per capita income above US$1,000. The Comprehensive Asia Development Plan (CADP) provides immediate policy guidance for industrialization through the development of logistics and other economic infrastructure. Beyond CADP, EAS member countries will face novel policy challenges that developing countries in the world have not broken through yet. This policy brief claims that establishing four virtuous cycles will be the key and we must have the courage to meet a number of policy challenges.
Topic:
Development, International Trade and Finance, Regional Cooperation, and Economic Growth
Political Geography:
East Asia and Asia