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Begin New Search Topic Economics Content Type Policy Brief Publication Year within 25 Years

31. Exchange Rate Predictability Based on Market Sentiments

Author:
Hyo Sang Kim, Eunjung Kang, Yuri Kim, Seongman Moon, and Huisu Jang
Publication Date:
09-2022
Content Type:
Policy Brief
Institution:
Korea Institute for International Economic Policy (KIEP)
Abstract:
It is well-known that exchange rates are difficult to forecast using observed macro-fundamental variables. This discrepancy between economic theory and empirical results is called the Meese and Rogoff puzzle. The purpose of this study is to address this puzzle from a new approach. Rather than pursuing a linkage between macro-fundamentals and exchange rates, we focus on the market sentiment index as a factor that could possibly enhance exchange rate predictability. The analysis folds into three phases. First, we conducted an assessment of the traditional exchange rate predictability model, as well as the augmented traditional model incorporating the market sentiment index. Second, we predicted the exchange rate by applying the market sentiment index, based on the contrarian opinion investment strategy commonly used by foreign exchange dealers. Finally, we analyzed if the machine learning model incorporating both economic fundamentals and market sentiment index could enhance the predictability of the exchange rate.
Topic:
Economics, Markets, and Exchange Rates
Political Geography:
Global Focus

32. Development of the IT Industry and Structural Transformation: Focused on IT Cooperation with Russia, Kazakhstan and Uzbekistan

Author:
Minhyeon Jeong, Jiyoung Min, and Dongyeon Jeong
Publication Date:
06-2022
Content Type:
Policy Brief
Institution:
Korea Institute for International Economic Policy (KIEP)
Abstract:
This study was designed as a primary study to analyze the economic significance and potential of cooperation with Russia, Kazakhstan and Uzbekistan in the IT sector, and to derive implications for new directions between Korea and the three countries with the advent of the fourth industrial revolution era. The goal of the study is to discuss what the development of the IT industry means for the three economies, examine the characteristics of each country, and gain policy implications on how cooperation with Korea should proceed in the future. To this end, this study is consisted of the following four components. First, the economic significance of IT technology cooperation with Russia, Kazakhstan, and Uzbekistan is viewed from the perspective of structural transformation. Second, the effect of IT cooperation between Korea and Russia on the Russian economy is quantitatively estimated through the analytical framework of structural transformation. Third, to supplement the limitations of theoretical discussions and derive customized cooperation directions for each country, the current status and policies of the IT industry in the three countries are examined in detail. Fourth, IT technology subsectors promising for cooperation between Korea and Russia are identified, from the patent citation analysis and network analysis.
Topic:
Development, Economics, Science and Technology, Industry, and Information Technology
Political Geography:
Russia, Central Asia, Eurasia, Kazakhstan, and Uzbekistan

33. Korea’s Regional Cooperation and ODA Policy in Asia: Performance and Challenges

Author:
Aila Yoo and Yul Kwon
Publication Date:
08-2022
Content Type:
Policy Brief
Institution:
Korea Institute for International Economic Policy (KIEP)
Abstract:
The COVID-19 pandemic and ongoing geopolitical conflicts have deteriorated socio-economic conditions all around the world. As developing countries in Asia have made enormous progress in economic and social development based on the stable ground for growth, the development gap within the region has also been expanded. In addition, the region’s socio-economic conditions have become worse after the pandemic. Along with the pandemic crisis, there are several issues that have negatively influenced the region’s sustainable growth, such as climate change and climate-related natural disasters, and conflicts. These multiple crises change the development needs in the region, and cannot be solved through the efforts of any sole country but must be tackled through regional cooperation. While Korea strengthens its strategic approach for regional economic cooperation to expand its partnership with emerging countries and its Official Development Assistance (ODA) volume is highly concentrated in Asia region, Korea still focuses on cooperation with each country based on priority countries’ Country Partnership Strategy (CPS) without any integrated regional cooperation strategy. Strengthening inclusive partnerships would be a key to reduce the development gap in the region, by supporting regional programs such as the ASEAN Connectivity and Mekong Subregion development projects. To improve policy coherence and tackle the region-wide problems, Korea should adopt an integrated regional cooperation approach by reflecting the characteristics of Asia. This study analyzes changes in the socio-economic conditions and development environment in the Asia region and provides policy implications for preparing regional cooperation strategy for Asia.
Topic:
Economics, Regional Cooperation, Partnerships, Economic Cooperation, and COVID-19
Political Geography:
Asia and South Korea

34. Lending to Defaulters: The IMF Updates Its Lending into Arrears Policy

Author:
Gregory Makoff
Publication Date:
08-2022
Content Type:
Policy Brief
Institution:
Centre for International Governance Innovation
Abstract:
The International Monetary Fund’s (IMF’s) “lending into arrears” policy outlines the criteria used by the IMF in deciding whether to loan to a country in default. This policy brief focuses on one of the conditions a country must meet when seeking debt relief from the IMF: it must engage in good faith negotiations with its creditors (known as the good faith criterion). The country must also implement significant financial reforms and provide assurances that it will be able to meet its financial obligations. This policy brief looks at the history of the lending into arrears policy, the controversy surrounding its use during Argentina’s 2005 debt restructuring and the May 2022 update to the policy.
Topic:
Economics, International Cooperation, Finance, and IMF
Political Geography:
Argentina and South America

35. Imperial Preference

Author:
Sven Biscop
Publication Date:
10-2022
Content Type:
Policy Brief
Institution:
EGMONT - The Royal Institute for International Relations
Abstract:
When the economy is globalised but decisions on policy are made in national capitals, states can choose to cooperate and run the global economy in their collective interest, even as they remain economic competitors. Or they can try to fence off their share of the market and force all others out – and economic competition quickly turns into geopolitical rivalry. Is this what will mark the 21st century?
Topic:
Economics, Globalization, International Cooperation, and Hegemony
Political Geography:
Global Focus

36. Russia’s connectivity strategies in Eurasia: Politics over economy

Author:
Kristiina Silvan and Marcin Kaczmarski
Publication Date:
06-2022
Content Type:
Policy Brief
Institution:
Finnish Institute of International Affairs
Abstract:
Russia has been attempting to strengthen connectivity within Eurasia since the early 2000s as a part of its policy to “pivot to the East”. Yet due to limited resources and political will, the tangible effects of its connectivity strategy have remained limited. The Russian Far East would greatly benefit from an improved connectivity infrastructure, given its proximity to Asian markets and the abundance of natural resources in the region. However, the attempts to accelerate regional socio-economic development by strengthening the region’s connectivity have failed to make a difference. In post-Soviet Central Asia, Russia adopted a passive approach to connectivity in the 1990s and 2000s, which meant focusing on maintaining and protecting the links inherited from the Soviet Union. It was only the pressure of external actors – both China and the West – that prompted Moscow to take a more active stance in the region in the 2010s. The launch of China’s Belt and Road Initiative pushed Russia to promote its own grand vision of trans-continental connectivity, the Greater Eurasian Partnership, designed to reaffirm Moscow’s great-power status and its equal standing with China. While it lacks economic and administrative foundations and its implementation is highly implausible, it has fulfilled a symbolic role as Russia’s grand connectivity project for Eurasia.
Topic:
Economics, Infrastructure, Belt and Road Initiative (BRI), Rivalry, and Resource Allocation
Political Geography:
Russia, China, Europe, and Asia

37. China’s Belt and Road Initiative: Successful economic strategy or failed soft-power tool?

Author:
Jyrki Kallio
Publication Date:
09-2022
Content Type:
Policy Brief
Institution:
Finnish Institute of International Affairs
Abstract:
The Belt and Road Initiative (BRI) is part of China’s efforts to integrate its neighbouring countries into its economic sphere, thus increasing China’s security in its immediate neighbourhood while facing an increasingly hostile international environment due to its rivalry with the US. In reality, the BRI has evolved into an umbrella term for various infrastructure and development projects with no unified object or strategy. The projects should, in principle, increase goodwill towards China, and correspondingly boost its influence, but in practice they are mainly aimed at economic benefit. The results of the BRI, especially as a soft-power tool, are ambiguous. Its ideational basis is thin, consisting mainly of China’s critique towards the “hegemony of the West”. This reduces the BRI to a hollow slogan with little appeal apart from the pragmatic gains. However, the BRI is here to stay for the duration of Xi Jinping’s rule because China’s foreign policy is often driven by prestige. The BRI is enshrined in the Communist Party’s Constitution in order to both add weight to the initiative and to increase the Party’s prestige with its success, modest as it may be.
Topic:
Economics, International Trade and Finance, Infrastructure, Hegemony, and Belt and Road Initiative (BRI)
Political Geography:
China and Asia

38. Mapping Innovation-Driven Entrepreneurial Ecosystems: An Overview

Author:
Alessandro Rosiello, Matjaz Vidmar, and Giulia Ajmone Marsan
Publication Date:
05-2022
Content Type:
Policy Brief
Institution:
Economic Research Institute for ASEAN and East Asia (ERIA)
Abstract:
Innovation-driven entrepreneurship enables people and companies to pursue global opportunities based on innovative processes, products, or services. Studies show that innovation-driven entrepreneurial high-growth firms represent a small fraction (<10%) of all start-ups but create more than 50% of jobs and are more resilient during crises, including the recent coronavirus disease (COVID-19) pandemic. However, their growth depends on an entrepreneurial ecosystem surrounding them, including access to key markets, finance, networks, and human resources, especially new knowledge and education. To ensure the development of innovation-driven entrepreneurial activities, their geographical and sectoral distribution needs to be mapped, but indicators are lacking, especially for the Association of Southeast Asian Nations (ASEAN). New sources of data, including social media, offer a new way to expand these indicators, and we propose a new methodology to identify emerging places of innovation-driven entrepreneurship (E-PIE).
Topic:
Economics, Entrepreneurship, Business, and Innovation
Political Geography:
Asia and ASEAN

39. Regional Perspectives on the Indo-Pacific Economic Framework

Author:
Matthew Goodman and Aidan Arasasingham
Publication Date:
04-2022
Content Type:
Policy Brief
Institution:
Center for Strategic and International Studies
Abstract:
The proposed Indo-Pacific Economic Framework (IPEF) is the Biden administration’s answer to questions about the United States’ economic commitment to the vital Indo-Pacific region. For this initiative to succeed, it must address concerns among regional partners about the framework’s form, function, benefits, inclusivity, and durability. Based on conversations with representatives from over a dozen regional governments, this brief summarizes Indo-Pacific perspectives on the IPEF.
Topic:
Economics, International Trade and Finance, Regional Cooperation, and Regionalism
Political Geography:
North America, United States of America, and Indo-Pacific

40. Beyond 2025: The Future of the African Growth and Opportunity Act

Author:
Daniel F. Runde and Sundar R. Ramanujam
Publication Date:
03-2022
Content Type:
Policy Brief
Institution:
Center for Strategic and International Studies
Abstract:
Over the past two decades, the United States has provided assistance and support for sub-Saharan Africa’s efforts to transform its economic and trade relationships, centered around the African Growth and Opportunity Act (AGOA). First enacted into law on May 18, 2000, AGOA was designed to significantly enhance designated sub-Saharan African countries’ market access to the United States by providing duty-free treatment for specific import categories. The legislation’s primary goal was to promote economic growth through good governance and free markets. To qualify and remain eligible for AGOA, countries were expected to demonstrate progress toward market liberalization and to improve the rule of law, human rights protections, and core labor standards. More than 20 years later, AGOA continues to provide preferential treatment to 44 countries in the region, spanning over 6,500 tariff lines. Since May 2000, AGOA has been amended four times, mostly to clarify preferential treatment terms, technical standards, and sunset deadlines. The act was initially designed to be valid for eight years, expiring at the end of September 2007. In July 2004, however, President George W. Bush signed the AGOA Acceleration Act, extending it to 2015. Toward the end of his second term, in June 2015 President Barack Obama extended its validity by signing the Trade Preferences Extension Act, under which AGOA is set to expire in 2025. The global political and economic landscape has changed profoundly since AGOA was enacted in 2000, even before the Covid-19 pandemic created new disruptions and accelerated several ongoing changes. The mobile telephony revolution has created new opportunities for millions to participate in the digital sphere, use mobile banking and payments systems, and receive commercial, educational, and medical services via the internet. Even as the sub-Saharan African region’s middle class continues to grow, it is also set to experience a youth population boom in the next three decades—which, under the right conditions, could pay a demographic dividend and avert a social crisis. Meanwhile, the United States has also entered an era of great-power competition with China. With China’s influence in sub-Saharan Africa rising significantly, this competition is also playing out through the region’s political and economic institutions. Considering these opportunities and challenges, leaders in Washington (and their constituents across the United States) ought to look at Africa as a prospect for deepening commercial partnerships, not as a continent that needs to be “saved” through foreign assistance. Accordingly, the United States can consider one of the three following scenarios in response to AGOA’s current expiration timeline
Topic:
Development, Economics, International Cooperation, and International Trade and Finance
Political Geography:
Africa