Manpower planning and labour markets in developing countries: A case study of west Malaysia

In the past, aggregative studies and forecasts have dominated manpower planning in developing countries. Such exercises, however, tend to assume away or ignore a host of institutional factors that have far‐reaching influences on the determination of wages and employment and on the efficiency of labour markets. Consequently, this paper argues that disaggregated manpower research, focussed on current problems and conditions in employment markets, would be far more useful to economic development policies than the sort of abstract macro‐planning aimed at forecasts of long‐term manpower requirements which has been highly fashionable during the last decade.

The theme of the paper is substantiated with reference to the organization and workings of labour markets in West Malaysia. It is found that institutional and economic factors peculiar to that country have resulted in three ‘insulated’ labour markets, one each for Malays, Chinese and Indians, with practically no mobility of labour across insulated markets, even in widely divergent supply‐demand conditions. The final sections of the paper briefly examine the implications of insulated markets for manpower and economic policies.     

The International Finance Corporation and the emerging market funds industry

Linking the world’s core equity markets with semi-peripheral and peripheral equity markets has been a fundamentally different process from linking core markets with each other. International financial institutions have played a larger role in core‐periphery equity market integration, and issues of corporate governance assume greater importance in the core‐periphery cases. Illustrating these differences, this article considers the creation of the Korea fund, one of the early country funds in an emerging market promoted by the International Finance Corporation (IFC). The case shows that increasingly sophisticated financial instruments, like country funds, alter the structure of the international financial system in such a way as to reposition governments in developing market economies with respect to their domestic financial systems; allow for some international capital inflows without loss of corporate control; and make diversification possible for a transnational class of investors. Moreover, the article proposes that international financial institutions like the IFC can alter the structural context of a particular market within which various financial actors later strike deals. In the light of the process of coalition building elaborated here, the article reserves a role for considerations of both multilateralism and a state’s position in the world system in a body of literature heavily concentrated on state-level political activity.     

Management response to the demands of global fresh fruit markets: Rewarding harvesters with financial incentives

Competition in global fresh fruit markets is now much more intense than a decade ago. Producers and exporters face an increasing number of quality requirements and regulations that are costly and challenge established practices: paying harvesters by the amount they harvest and trying to control quality with sanctions. Based on a field study, this article discusses how lemon producers in northern Argentina are responding to these challenges; why some have responded only by introducing non-contractual innovations, while others by rewarding harvesters for careful performance to insure fruit quality. The findings elucidate arguments about the instrumentality of transaction costs on the choice of both managerial practices and forms of remunerating labourers. It also illustrates that added quality demands of foreign markets eased the task of harvesters, but had a varying effect on labourers' income.     

Contextuality and data collection methods: A framework and application to health service utilisation

When establishing the value of imports for tariff assessment, most countries apply duties to a cost‐insurance‐freight (c.i.f.) value of the traded good. One effect of using a c.i.f. valuation base is to place a disproportionate burden on countries that have relatively higher freight and insurance costs. Using matched tariff and transport cost information for six Latin American countries this study examines the influence of alternative valuation procedures on the level and incidence of tariff protection. The results show that developing countries are generally at a major transport and insurance cost disadvantage (relative to developed countries) on inter‐regional trade and that the relatively high Latin American tariffs applied on c.i.f. prices further worsen their competitive position. A shift to free‐on‐board. (f.o.b.) valuation would remove the bias against developing country intra‐trade.     

Trust and inter‐firm relations in developing and transition economies

The role of trust in facilitating economic growth has been highlighted in previous contributions to this journal. In order to take this debate forward, this article argues (1) that more attention needs to be given to the relationship between sanctions and trust, and (2) that it is worth distinguishing between the minimal trust for making markets effective and the extended trust required for deeper kinds of inter‐firm co‐operation to work. The article goes on to ask why minimal trust is lacking and so hard to construct in the republics of the former Soviet Union. It then examines how extended trust grows or can be made to grow in industrial supply chains and clusters in developing countries.     

OECD imports of leather: Indian performance and real exchange rates of the Indian rupee

This article reports an econometric investigation of shares by source in imports of leather and leather manufactures into OECD markets over the period 1974–87, at four‐digit SITC level. The Indian share at each destination relative to that of other major exporters, taken serially and independently, is tested for sensitivity to relative price fluctuations as measured by the real bilateral exchange rate between the Indian rupee and the currency of the fellow exporter. The pattern of findings by product category and destination provides important guidelines for exchange rate policy and export strategy.     

Employment effects of output and technological progress in Malaysian manufacturing

A major factor contributing to the growth in industrial employment in Malaysia was the implementation of the export‐oriented industrialisation strategy. With the withdrawal of GSP privileges to the USA, the inevitable loss of comparative advantage in labour cost and the emergence of trading blocs, it is feared that the growth of the export‐oriented sectors in manufacturing will be impeded, causing a serious unemployment problem. This fear is compounded by the increasing shift to technology‐intensive methods of production which displace labour. This article shows that domestic demand and export expansion exert positive and almost equal influence on industrial employment. Any negative impact on employment due to a shortfall in exports could be neutralised if an appropriate choice of import‐substituting and export expansion policies is adopted. Displacement of labour due to the substitution effect of using technology‐ and capital‐intensive production is largely compensated for by the increase in labour utilisation due to the output effect of increased production for both the domestic and foreign markets.     

Outward Foreign Direct Investment,Exporting and Firm-Level Performance in Sub-Saharan Africa

Abstract

We consider the relationship between how a firm serves foreign markets and performance, using survey data on manufacturing and services firms for African countries. Results for manufacturing industries indicate a clear productivity ordering with firms undertaking outward Foreign Direct Investment (FDI) performing best, followed by exporters and domestically oriented firms. Results for services firms are more nuanced, indicating that while exporters and firms undertaking outward FDI are more productive than domestically oriented firms, there is no significant difference in productivity between these two types of firms (some evidence suggests that the productivity of exporters is larger than that for firms undertaking outward FDI).     

The new face of developing country debt

Developing country debt has been a major preoccupation for development policy makers and practitioners since the debt crisis of 1982. It is a major obstacle to economic and social progress in developing countries. After the resolution of the Asian financial crisis of the late 1990s and the debt relief initiatives for low-income countries of 1997–2006 concerns about developing country debt seem to have receded. However, there are a growing number of problems that warrant concern, including the accumulation of domestic debt, short-term debt and private non-guaranteed debt, and increasing recourse by low-income countries to international capital markets. At the same time developing countries have strengthened their capacity to oversee and analyse their debt portfolios. Nonetheless, significant weaknesses remain in debt management capacity at the national level. Moreover, the activities of ‘vulture funds’ and the lack of a sovereign debt restructuring mechanism reveal major shortcomings in the international institutional architecture that need to be addressed urgently.     

Transaction Costs,Information Technologies,and the Choice of Marketplace among Farmers in Northern Ghana

Abstract

Using a transactions costs framework, we examine the impact of information and communication technologies (mobile phones and radios) use on market participation in developing country agricultural markets using a novel transaction-level data set of Ghanaian farmers. Our analysis of the choice of markets by farmers suggests that market information from a broader range of markets may not always induce farmers to sell in more distant markets; instead farmers may use broader market information to enhance their bargaining power in closer markets. Finally, we find weak evidence on the impact of using mobile phones in attracting farm gate buyers.     

Automotive global value chains in Mexico: a mirage of development?

ABSTRACT

International monetary organisations argue the ‘developing countries’ should foster linkages to the world economy as a means to overcome backwardness. In this article we refute the narrative that Mexico has experienced industrial upgrading. Rather, industrial growth in Mexico over the last 40 years has been shaped by neoliberal economic policies which have turned the Mexican economy into an export-led manufacturing platform designed to supply the North American market, sustained by a precarious labour market. As a result, Mexico occupies the most labour-intensive and low value-added segments of regional production chains. To make this argument, we perform an in-depth analysis of the Mexican automotive industry, demonstrating that instead of being an engine for domestic industrial development, the auto industry has become a dominant economic sector through productive hyper-specialisation concentrated in the northern Mexican border states, a reliance on transnational capital, particularly from the United States, a disconnect with domestic markets, and the super-exploitation of labour.     

The Impact of EU Export Refunds on the African Continent: An Impact Assessment

The EU’s export refund policy has long been a source of controversy for its perceived impacts on third country markets. However, the EU Commission maintain that these concerns are largely historic as CAP reforms mean that export refunds are now used infrequently. The purpose of this article is therefore to assess the impacts of refunds in the wake of the 2003 reform of the CAP using two complementary analyses: first, an analysis using a computable general equilibrium model and second, two case studies to assess the potential impact of export refunds in selected African developing countries.     

On the social cost of individuals’ extra effort

Most methodological work on project appraisal in developing countries have so far been primarily concerned with industrial projects and distortions in the foreign trade sector.¹ In this paper interest is focused on projects in the rural sector and in particular on a neglected aspect of labour cost valuation, viz. valuation of individuals’ work effort expended.     

Urbanization,rural land system and social security for migrants in China

Temporary migration due to lack of social security for migrants, rural land tenure insecurity due to frequent land reallocation and abusive land requisition due to lack of functioning land markets are all major policy challenges that China is facing in its yet-to-be finished economic transition. Although there have been intensive studies and various policy recommendations on these issues, most discussions have so far neglected the close interrelationships between these issues and have failed to analyse them in an integrated framework. The paper aims to establish such an analytical framework. By taking into account the impacts of China's characteristics, that is a large developing country in transition, on the country's migration and rural land policies, we propose a policy package to address these challenges in a holistic manner.     

Japan's post‐war protection policy: Some implications for less developed countries

This article examines some of the implications of Japan's postwar development for contemporary developing countries. Whilst acknowledging the qualitative differences in economic structure between Japan in 1945 and today's developing countries it argues that many of Japan's decisions on economic strategy throw light on current debates regarding the merits of free trade or protectionism as strategies for developing countries. It stresses however the key role played in Japan by the highly competitive nature of the internal market and stresses the need to consider policies to stimulate a more competitive internal structure within developing country markets.     

Policy and Non-Policy Barriers to Trade and Implicit Taxation of Exports in Uganda

Uganda has made significant progress in reducing policy-induced anti-export bias in its trade policy in the 1990s. Taxes on exports have been abolished, and import protection has been reduced considerably. Such trade barriers are only a component of thee transaction costs associated with trade. Poor infrastructure, notably by increasing transport costs, and institutional inefficiencies can significantly increase trade costs. The effective protection of imports, and implicit tax on exports, due to transport costs is calculated and compared to effective protection due to trade policy barriers for Uganda. The results reveal that transport costs are often very high, in many cases representing a greater cost (tax) to exporters than trade policy.     

Health strategy and development planning: Lessons from the people's republic of China

In Section I of this paper we present an analytical paradigm by which to evaluate health and medical care services in underdeveloped countries. In Section II, we apply this framework to an analysis of the health policies of one developing country, China. In Section III, we evaluate the Chinese health and medical care policies within the framework of a cost‐benefit analysis and argue that these policies are appropriate to China's factor proportions and health needs. Finally, in Section IV, we raise a number of questions to be considered in any more detailed studies on the transferring of the Chinese services to other developing countries.     

Remittances and Chain Migration: Longitudinal Evidence from Bosnia and Herzegovina

Abstract

Most of the literature on remittances focuses on their implications for the welfare of family members in the country of origin and disregards their role as facilitator of chain migration. We address this issue with the use of longitudinal data from Bosnia and Herzegovina, one of the primary exporters of migrants and recipients of remittances in the world. We find that remittances have a significant positive impact on the migration prospects of their recipients. Better-endowed people are most likely to migrate, which highlights a potential negative implication of migration and remittances.     

System of cities dynamics in newly industrializing nations

Rapid industrialization in such countries as Korea, Malaysia, and Taiwan suggests that the complex functional structures of cities in the periphery may appear early in development. This paper proposes a 4-stage framework for the dynamics of a system of cities in a developing country undergoing industrialization and encompassing both nonindustrial and industrial development. The synthesis is assessed with evidence from the newly industrializing Asian nations of Korea, Malaysia, and Taiwan. The 4 stages of cities' industrial change include 1) increasing primacy with industrial satellites, 2) increasing primacy with industrial satellites and nodal towns on a transport network, 3) rapidly increasing primacy with rapidly growing industrial satellites and nodal towns on the transport network, and 4) decreasing primacy with slowly growing industrial satellites and rapidly growing peripheral industrial towns. The 4-stage synthesis suggests that economic development in the periphery may occur even while the primate city maintains its hegemony over control and coordination functions. Peripheral industrial growth does not challenge this hegemony. The growth of industrial cities is, instead, part of a process of regional specialization in which the low cost labor in the periphery becomes an attraction for industry. These stages are not inevitable. Government efforts are necessary to develop rural areas in terms of social improvements (education and health), capital infrastructure (transportation and utilities), and fair payments to farmers for their outputs. These seem to be the lessons learned from the industrialization process in Korea, Malaysia, and Taiwan.     

Do double taxation treaties increase foreign direct investment to developing countries?

Developing countries invest time and other scarce resources to negotiate and conclude double taxation treaties (DTTs) with developed countries. They also accept a loss of tax revenue as such treaties typically favour residence-based over source-based taxation and developing countries are typically net capital importers. The incurred costs will only pay off if developing countries can expect to receive more foreign direct investment (FDI) in return. This is the first study to provide evidence that developing countries that have signed a DTT with the US or a higher number of DTTs with important capital exporters actually do receive more FDI from the US and in total. However, DTTs are only effective in the group of middle-, not low-income developing countries.