The Developing Economies
Volume 44, Number 1 (March 2006)
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CONTENTS
Original Articles
Page 1-26
Page 27-52
Page 53-78
Page 79-91
Book Reviews
Page 92-95
Page 95-99
The Macroeconomics of HIV/AIDS edited by Markus Haacker/ Kenichiro Kono
Page 100-103
Books Received for Review
Page 104-105
Abstract
Jikun
Huang,
Scott
Rozelle,
and
Honglin
Wang,
"Fostering
or
Stripping
Rural
China:
Modernizing
Agriculture
and
Rural
to
Urban
Capital
Flows,"
pp.
1-26.
This
paper
focuses
on
the
flow
of
fiscal
and
financial
resources
in
China's
rural
economy
during
the
first
two
decades
of
reform.
Specifically,
we
seek
to
quantify
the
nature
and
direction
of
the
capital
flows
between
agriculture
and
the
nonagricultural
sectors
and
between
the
rural
and
non-rural
sectors.
We
track
identify
the
flows
of
three
main
sources
of
capital;
fiscal
flows,
financial
shifts
through
the
formal
banking
system,
and
the
implicit
taxes
that
are
moving
through
the
grain
system
due
to
payment
of
in-kind
(e.g.,
delivery
quotas
by
farmers).
Through
this
analysis,
we
provide
policy
makers
with
a
set
of
measures
that
show
that
although
in
recent
years
the
agriculture-to-industry
and
rural-to-urban
flows
have
appeared
to
reverse
themselves,
as
late
as
2000
it
does
not
appear
as
if
the
government
is
not
directing
enough
resources
into
the
rural
economy;
greater
flows,
however,
are
needed
if
rural
China
is
to
modernize.
Keywords:China; Fiscal flows; Financial flows; Agriculture-to-industry; Rural-to-urban
JEL classification:H20, O18, R51
--------------------------------------------------------------------------------
Sylviane
Guillaumont
Jeanneney,
Ping
Hua,
and
Zhicheng
Liang,
"Financial
Development,
Economic
Efficiency,
and
Productivity
Growth:
Evidence
from
China,"
pp.
27-52.
Financial
development
may
lead
to
productivity
improvement
in
developing
countries.
In
this
paper,
based
on
the
Data
Envelopment
Analysis
(DEA)
approach,
we
use
the
Malmquist
index
to
measure
China's
total
factor
productivity
change
and
its
two
components
(i.e.,
efficiency
change
and
technical
progress).
We
find
that
China
has
recorded
an
increase
in
total
factor
productivity
from
1993
to
2001,
and
that
productivity
growth
was
mostly
attributed
to
technical
progress,
rather
than
to
improvement
in
efficiency.
Moreover,
using
panel
data
set
covering
29
Chinese
provinces
over
the
period
of
1993-2001
and
applying
the
Generalized-Method-of-Moment
system
estimation,
we
investigate
the
impact
of
financial
development
on
productivity
growth
in
China.
Empirical
results
show
that,during
this
period,
financial
development
has
significantly
contributed
to
China's
productivity
growth,
mainly
through
its
favorable
effect
on
efficiency.
Keywords:Financial development; Total factor productivity; Chinese economy
JEL classification:O16, O47, R11
--------------------------------------------------------------------------------
Chaoshin
Chiao
and
Weifeng
Hung,
"The
Stock
Market
Valuations
of
R&D
and
Electronics
Firms
during
Taiwan's
Recent
Economic
Transition,"
pp.
53-78.
The
objective
of
this
paper
is
to
study
the
market
valuation
of
R&D
investments
in
the
Taiwan
stock
market
from
July
1988
to
June
2002.
The
motivation
stems
from
Taiwan's
recent
economic
transition
from
a
labor-intensive,
then
to
a
capital-intensive,
and
currently
to
a
technology-based
economy.
The
results
support
not
only
the
existence
but
also
the
persistence
of
R&D-associated
mispricing.
More
importantly,
it
has
become
stronger
as
the
electronics
industry
gradually
dominates
the
economy.
Firstly,
R&D-intensive
stocks
tend
to
outperform
stocks
with
little
or
no
R&D.
Secondly,
the
R&D-intensity
effect
cannot
fully
be
attributed
to
firm
size.
Thirdly,
the
R&D-intensity
effect
is
more
pronounced
for
firms
in
the
electronics
industry
after
1996.
Keywords:R&D; Stock returns;Taiwan's economic transition
JEL classification:G12, O33
--------------------------------------------------------------------------------
Patricia
Alvarez-Plata
and
Mechthild
Schrooten,
"The
Argentinean
Currency
Crisis:
A
Markov-Switching
Model
Estimation,"
pp.
79-91.
In
2002,
the
Argentinean
currency
board
came
to
a
sudden
and
dramatic
end.
Although
the
country
had
been
suffering
from
weak
economic
fundamentals
for
years,
the
timing
and
severity
of
the
currency
crisis
surprised
most
observers.
This
paper
analyzes
the
role
of
fundamentals
and
self-fulfilling
speculation
in
the
Argentinean
crisis.
Arguing
within
a
theoretical
model
of
a
fixed
exchange
rate
system
that
allows
for
multiple
equilibria,
we
show
that
the
crisis,
while
associated
with
weak
fundamentals,
cannot
be
explained
by
these
macroeconomic
factors
alone.
Estimating
a
univariate
Markov-switching
model,
this
paper
shows
that
shifts
in
agents'
beliefs
did
indeed
also
play
a
crucial
role.
Keywords:currency crises,; Self-fulfilling speculation; Markov-switching models
JEL classification:C22, F31, F36