Economy year ender

Unlike in politics or even business, it is difficult to identify distinct "events" in an economy and say, "that's important, should be in the list of top ten stories." The economy after all is a system of billions of interacting parts, with each transaction in itself trivial, but adding up to an incomprehensible whole. Hence, for instance, GDP going up is not literally a single "event". But for convenience I'll just point to some top "developments" in the economy and business, which I think will have a widespread and lasting impact on the economic system. Three are external, and the rest internal; some are distinct political events which I think are portents of deep economic change.

1. Collapse of the Doha round - again: The Doha development round stalls, over as usual over OECD farm subsidies and market access. The US, EU, India, and Brazil remain at loggerheads. But I betcha the rest are just hiding behind the behemoths , waiting to throw up dust again whenever a settlement approaches.
2. Climate change and what the world is doing about it - the UN IFCC confirms a scientific consensus linking global warming to greenhouse gash emissions and, with Al Gore, wins a Nobel Prize; the world gathers in Bali to talk about solutions, as the Kyoto protocol approaches its end in 2012.
3. The US economy flounders on the subprime crisis - the exposure of bad debts in the subprime mortgage sector and the related drop in housing prices was financial debacle, eventually sending the US dollar reeling worldwide. The US economy itself teeters on the edge of fiscal and current account imbalances; and Greenspan talks of even odds of recession.
4. The Philippine peso surges - in a spectacular run, the peso gains 19% against the dollar, making it unusually strong even in a year of the declining dollar. Some gainers, some losers; I think mostly losers.
5. Favorable macro figures sustained - inflation remains low, even unemployment drops, and GDP surges to dragon territory at 7.1%, continuing its steady rise from 2000. Is the boom-bust over? Let's see. Oh, and the fiscal balance was kept (as foreign debt payments dropped, thanks to #4); the Bangko Sentral continues monetary easing over the year. Not bad, not bad at all, but not all good.
6. The country joins the biofuels bandwagon - on January 12, the government legislated the Biofuels Act, which requires mandatory blending of gasoline and diesel with biofuels and incentives for biofuels investment. All without the superfluous luxuries of a feasibility study. Meanwhile to dig a hole in the ground you need an Environmental Impact Assessment. Go figure.
7. The Comprehensive Agrarian Reform Program enters its last year - after the Sumilao drama, hope we don't forget, the CARP is about to end. (Or rather, the mandatory appropriation from the Agrarian Reform Fund is. But let's not split hairs.) Already lawmakers are filing their bills , consultants are submitting their studies, and buzzards are circling their prey.
8. Decentralization at the forefront in Pampanga - the historic upset win of priest-on-leave Ed Panilio is heartening; his political will to finally collect resource rent (in this case, the quarry fees) sets a precedent for a cowardly national government; and his loud whistle blowing against venal politics is rousing. Hip hip!
9. The ODA scams - ah yes, corruption. Anomalous deals taint the NBN, the CyberEd, even the World Bank roads project. I elevate this above the others, because of its international scope - it can't be just the Filipinos who are being flip with the law. Remember the Bataan Nuclear Power Plant? Expect tightening up of accountability on both sides after this.
10. Estrada pardon - institutions are now entering empirical analysis of economic growth. The Estrada pardon (after a 7 year plunder trial and conviction) !!! is one remarkable approach to the rule of law. You don't need a storm to tear down a house - letting the termites in will do the job equally well.

Koreans opt for the 747

In their just-concluded election, Koreans went for the gut, rather than abstract issues of engagement with the North, and all that. Korea has the world's eleventh biggest economy, but its ascent to new economic heights has been stymied in part by sclerotic policies. The new president promises to change all that.

A business executive background has burnished President-elect Lee's market-friendly persona. I just hope that being "business-friendly" does not translate to being friendly to "some business" - the mistake of booty capitalism. A real pro-market policy is friendly to "any business", even of businesses that do not yet exist. (That's my neoclassical-rationalist koan for you, grasshopper.)

Here is the President-elect's English language homepage, containing his platform and bio. The bio was especially interesting, covering his famous rags to riches story (but more of the rags, actually). I could say that this suggests the following hypothesis: inculcating values among juveniles conducive to respect for property rights, desirability of commercial exchange, and low valuation of leisure time creates an intergenerational pathway out of poverty. Anecdotal evidence:


The beggar family had a son of my age, and I became friend with him. I envied him so much. Although my parents worked hard at the market every day, I and my brothers and sisters often had to skip meals. Often, we would drink from the water pump to fight the hunger. However, my friend had somewhat different life. Every morning, after his beggar parents make a tour all around the town, Then his family would sit together and eat rice. It was not a corn soup. It was not a dreg, it was rice. How much I envied him as I watched through the open doors! I thought ‘Ah, my family is not even better than a beggar.’

I came across this friend after decades have passed since then. One day, when I was serving my country as a member of the assembly, I visited Los Angeles of United States. ‘Hey, Myung Bak!’ Somebody called my name after I finished a ceremony. It was that beggar friend next door. I was totally surprised. Living in LA, he came to visit me as soon as he knew I came here. For all night long, we talked; sometimes with tears, sometimes with laughs. It is then he told me his history. ‘When we were still kids, I thought my family was better off because we had rice every day.’ Then he said he found out later That his parents raised their children not by working but by begging. Eventually, all his brothers and sisters lead poor lives now, And only he has managed to fly over to the States and barely make living. He told me ‘Now I have all grown up, I realized why your parents always worked hard and never sought others’ property.’ I felt ashamed for myself, who envied the ‘Meals of my beggar friend’.


This is the set of values that Koreans have voted for. See you on the runway.

Too much fancy stuff on Rational Choice

According to this meter, I am being too fancy, contrary to my motto. (Hat tip: New Economist). Since you are a genius, tell me how I can improve. I want to dumb it down without treating you like an idiot.

Surely there is an optimum somewhere - where I transmit the gist of an idea or finding, subject to a constraint on readability and my time-effort for writing this blog. (Or given that set-up, maybe I am already at it? Heheh.) Look, if this post requires a genius, then I'm still faithful to my motto.

Women with higher salaries do less housework (duh)

This paper published in the Journal of Marriage and Family has been drawing a lot of attention lately (see this Yahoo video). Like it's a big discovery.

Hmmm. Higher wage = higher opportunity cost of time (spent in housework) = economize on housework. To an economist this is soooo obvious. Note that this prediction works even if the household makes choices like a single decision-maker (i.e. women and men are not autonomous, but make choices as if a single mind). Of course empirical work like this on quantifying the size of the predicted effect is welcome. Still, the real mystery to me is why this and not some other (more surprising) study made the rounds in the press.


Disclaimer: have only read the abstract and some media reports. But I doubt if I'll change my mind if I ever get to read the whole thing.

How best to reduce greenhouse gases in the air

A big round of talks are on in Bali right now on climate change. Kyoto is set to expire by 2012 and a new treaty is in the making - or is it? I think the discussion about the link between GHG emissions and global warming is over, at least in direction. (More GHG = warmer earth.)

No consensus exists on:

• How much global warming is expected
• What are the costs of global warming
• What kinds of carbon reduction efforts should be implemented and
• How much to invest in these efforts.

Env-econ has an interesting post on the role of forests in carbon reduction. Basically forests act as a carbon store (for protected areas) or a carbon sink (for managed areas being routinely harvested). The latter is a bit complicated: timber needs to be harvested, but if the tree is valued also for its ability to take carbon out of the air, then (if there are carbon reduction payments) forest managers would have to take this into account in timing their harvest and replanting. One interesting point: it would take about $200/ton carbon price for managers to cease harvesting - way beyond realistic estimates of maybe $20-30/ton.

Papers I have written or coauthored

Webpage containing copies of some of my papers, and URLs to others. Copyrighted material available only in working paper version. Updates this page.

PUBLICATIONS IN REFEREED JOURNALS

Briones, R. 2007. “Eating for a Lifetime: Filling the Policy Gaps in Philippine Fisheries.” Asian Journal of Agriculture and Development 4(1):25-40. Esnips download. Link to download.

Briones, R. 2006. ”Projecting Future Fish Supplies Using Stock Dynamics and Demand.” Fish and Fisheries 7(4):303-315. Esnips download. Abstract.

Briones, R. 2006. “Employment Generation for the Rural Poor in Asia: Perspectives, Patterns, and Policies.” Asian Development Review 23(1):89-118. Esnips download. Esnips download.Abstract; Free download.

Dey, M., R. Briones, and M. Ahmed. 2005. “Disaggregated Analysis of Fish Supply, Demand, and Trade in Asia: Baseline Model and Estimation Strategy.” Aquaculture Economics and Management 9(1/2):113-139. Esnips download. Esnips download.Free download.

Briones, R., M. Dey, M. Ahmed, I. Stobutzki, M. Prein, and B. Acosta. 2004. “Impact Pathway Analysis for Research Planning: the Case of Aquatic Resources Research in the WorldFish Center.” NAGA – The WorldFish Center Quarterly 27(3/4):48-50. Esnips download. Esnips download.

Briones, R. 2002. “Interlinked Credit, Relational Contracting, and the Spread of Rural-Based Manufacturing: the Case of Garment and Metalcraft Industries in the Philippines.” Philippine Review of Economics 39(1):103-120. Esnips download. Abstract.

Rodriguez, U-P, and R. Briones. 2002. “The Ateneo Macroeconomic Forecasting Model.” Philippine Review of Economics 39(1):142-178. Esnips download. Abstract.

Briones, R. 1996. “Calorie Intake Responses to Macroeconomic Adjustment.” Philippine Review of Economics and Business 33(2): 319-344. Abstract.

OTHER PUBLICATIONS

Briones, R., Tran Thi Huyen Trang, Nguyen Cong Dan, Nguyen Huu Ninh, Pham Van Khanh, Nguyen Hien Thi, Don Griffiths and Trinh Quoc Trong. 2007. “The Business Approach to Operating National Broodstock Centres: An Innovative Strategy for Developing the Freshwater Aquaculture Seed Industry in Viet Nam.” NACA Aquaculture Asia12(4): 18 – 21. Esnips download. Free download.

Fawcett, C., R. Briones, and A. Tafgar. “Jobs for the 21st Century: Synthesis Paper”. EDC, Newton, MA. Esnips download. Abstract.

Boardman, G., R. Briones, C. Fawcett, A. Hamid, and Y. Rostiawati. “Jobs for the 21st Century: Indonesia Assessment”. EDC, Newton, MA. Esnips download. Abstract.

Briones, R., and A. Garcia, eds. Poverty Reduction through Sustainable Fisheries: Emerging Policy and Governance Issues in Southeast Asia. SEARCA, College, Laguna, Philippines (Forthcoming book).

Briones, R., and A. Garcia, “Introduction and Synthesis.” In: Briones, R., and A. Garcia, eds. Poverty Reduction through Sustainable Fisheries: Emerging Policy and Governance Issues in Southeast Asia. SEARCA, College, Laguna, Philippines (Forthcoming book).

Briones, R., R. Gerpacio, and M. Ahmed. “Regional Cooperation.” In: Briones, R., and A. Garcia, eds. Poverty Reduction through Sustainable Fisheries: Emerging Policy and Governance Issues in Southeast Asia. SEARCA, College, Laguna, Philippines (Forthcoming book).

Briones, R., 2007. “Projections of Supply and Demand for the Trade in Live-Reef Fish for Food.” Economics and Market Analysis of the Live Reef-fish Trade in the Asia–Pacific Region. Brian Johnson, ed. ACIAR Working Paper No. 63. Esnips download. Free download.

Briones, R., L. Garces, and M. Ahmed (2006). “Climate Change and Small Pelagic Fisheries in Developing Asia: the Economic Impact on Fish Producers and Consumers.” Climate Change and the Economics of the World’s Fisheries: Examples of Small Pelagic Stocks. R. Hannesson, M. Barange, S. Herrick Jr., eds. Edward Elgar, Cheltenham. Esnips download. View product.

Briones, R., 2005. “Public Works Employment and Rural Poverty Alleviation in the Philippines.” Reducing Rural Poverty in Asia: Challenges and Opportunities for Microenterprises and Public Employment Schemes. Nurul Islam, ed. Haworth Press, Binghamton NJ. Esnips download. View product.

Briones, R. 2005. “Property Rights Reform in Philippine Agriculture: Framework and Review Of Experience.” Special Issues in Agriculture, Eliseo Ponce, ed PIDS, Makati.

Dey, M., U-P.Rodriguez, R. Briones, O. Chen, M. Haque, L. Li, P. Kumar, S. Koeshendrajana, S.Y. Tai, A. Senaratne, A. Nissapa, N. T. Khiem, M. Ahmed (2004). Disaggregated projections on supply, demand, and trade for developing Asia: preliminary results from the AsiaFish Model. 2004 Proceedings of the Biennial Conference of the IIFET. IIFET, Corvallis, Oregon. Esnips download.

Dey, M., R. Briones, and M. Ahmed. 2004. “Global trade and the poor: impact of product standards in major importing countries.” 2004 Proceedings of the Biennial Conference of the IIFET. IIFET, Corvallis, Oregon. Esnips download.

Habito, C., R. Briones, and E. Paterno. 2003. Investments, Productivity, and Land Market Impacts of the Comprehensive Agrarian Reform Program (CARP). CARP Impact Assessment Studies vol. 4. Department of Agrarian Reform, Quezon City.

Dey, M., R. Briones, and M. Ahmed. 2002. “Modeling the Asian fish sector: issues, framework, and method.” 2002 Proceedings of the Biennial Conference of the IIFET. IIFET, Corvallis, Oregon.

Briones, R., et al. 1999. “Food security: household perspective.” In Food Security in the Philippines. L. Cabanilla and M. Paunlagui, eds. Institute of Strategic Planning and Policy Studies – UP CIDS, Quezon City.

Briones, R. et al. 1994. “An integrated analysis of past and existing programs and policies directed towards poverty alleviation and improving income distribution.” Understanding Poverty and Inequality. P.S. Intal, ed. National Economic and Development Authority and United Nations Development Program, Manila.

SELECTED UNPUBLISHED PAPERS

Briones, R., M. Dey, M. Ahmed, M. Prein, I. Stobutzki. “Priorities for international research on aquatic resources.” Esnips download.