Asian Economic Policy Review

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Latest documents

• Deconstructing Deglobalization: The Future of Trade is in Intermediate Services

  This article contests the idea that the world has entered a post‐globalization era. It argues that rapid globalization has evolved rather than ended. Even though the global goods trade‐to‐GDP ratio reached its zenith 15 years ago, the rapid rise of services trade has persisted and now accounts for one‐fifth of international commerce. The paper makes a statistical and logical case that the future of trade lies in services trade—especially trade in intermediate services.

• Supply Chain Decoupling: Geopolitical Debates and Economic Dynamism in East Asia

  Supply chain decoupling in the US–China confrontation has generated serious uncertainties for private businesses. This paper focuses on machinery international production networks in East Asia and tries to find quantitative evidence on supply chain decoupling by using international trade statistics, particularly from the viewpoint of middle powers such as Japan. While data on the sectoral level of trade do not show any clear evidence of supply chain decoupling, some specific US export controls indeed affect international transactions when examined at a finely disaggregated level. We econometrically measure the effect of some of the US policies on Japanese exports to China. The recent strengthening of US export controls related to supercomputers and advanced integrated circuits is likely to generate further effects. Nevertheless, the supply chain decoupling seems to end up as a partial one, and a large portion of International Production Networks (IPNs) may remain active. In conclusion, the paper briefly discusses the policy implications of the analysis.

• The Impact of Foundational AI on International Trade, Services and Supply Chains in Asia

  Foundational artificial intelligence (AI) is a general purpose technology that will affect economic activity across industries, with potentially significant impacts on jobs and international trade. This could include automation of routine and nonroutine white‐collar jobs, which reduces international trade where these jobs are on‐shored. However, where AI compliments existing jobs and leads to higher productivity, this could open up new opportunities for international trade in services. How foundational AI affects international trade will also depend on how it is regulated. Governments are moving to regulate AI, which could become a barrier to international trade. Geopolitics could also undermine opportunities for AI to deepen globalization and trade in AI as the USA and China restrict trade in the technology needed to build and run foundational AI systems. Regulating the impact of AI on international trade is an increasing focus in free trade agreements (FTAs) and digital economy agreements (DEAs). The World Trade Organization (WTO) Joint Statement Initiative (JSI) e‐commerce negotiations could also support trade in AI. Yet, there is much more that trade policy could do to minimize barriers to trade in AI.

• Comment on “Can the World Trade Organization Act as a Bulwark Against Deglobalization?”
• Deglobalization: Editors' Overview
• Comment on “International Finance and Geopolitics”
• Comment on “Implications of Deglobalization on Energy and Carbon Neutrality in Asia and the Pacific Region”
• Comment on “Supply Chain Decoupling: Geopolitical Debates and Economic Dynamism in East Asia”
• Comment on “Can the World Trade Organization Act as a Bulwark Against Deglobalization?”
• Comment on “The Impact of Foundational AI on International Trade, Services and Supply Chains in Asia”

Featured documents

• US–Japan Trade Frictions: The Past, the Present, and Implications for the US–China Trade War

  The United States and Japan have been involved in trade frictions over a number of products including textiles, steel, automobiles, semi‐conductors, and agricultural products over the last 50 years. US–Japan trade frictions have taken basically two forms: (i) the United States attempting to...

• International Transmission of the People's Bank of China's Balance Sheet Expansion

  The People's Bank of China's (PBoC) balance sheet expanded more dramatically than any of its major international counterparts during the past decade. The main contribution to this expansion was the rapid accumulation of the central bank's foreign assets, as a result of foreign exchange market...

• Korean Unification: Economic Adjustments under German Assumptions

  This paper explores the impact of unification on North and South Korea under the hypothetical scenario that German‐type reunification occurs in the Korean peninsula. Simulation results using a global dynamic general equilibrium model show that with comprehensive market‐oriented reform and opening,...

• The Labor Contract Law, Macro Conditions, Self‐Selection, and Labor Market Outcomes for Migrants in China

  China introduced a new Labor Contract Law (LCL, 2008) to protect employees’ working conditions and welfare. Early evaluations of labour market outcomes suggest positive effects for workers. In the same period, however, China faced labor market tightening, which facilitated the LCL's introduction...

• The Long‐Term Impacts of the 1998 Nagano Winter Olympic Games on Economic and Labor Market Outcomes

  This paper aims to assess the long‐term effects of the 1998 Nagano Winter Olympic Games on various economic and labor market outcomes in Nagano Prefecture. One‐shot and large‐size events, such as the Olympic Games, are expected to boost the local economy and create jobs, thus leading to lower...

• Japan Center for Economic Research
• Deconstructing Deglobalization: The Future of Trade is in Intermediate Services

  This article contests the idea that the world has entered a post‐globalization era. It argues that rapid globalization has evolved rather than ended. Even though the global goods trade‐to‐GDP ratio reached its zenith 15 years ago, the rapid rise of services trade has persisted and now accounts for...

• The Southeast Asian Economies in the Age of Discontent

  This paper investigates the effects on and responses of five middle‐income Southeast Asian economies to the current global environment of authoritarian populism, the retreat from economic liberalism, and the appeal of anti‐globalization movements. While the political histories and institutional...

• An Assessment of Abenomics from the Labor Market Perspective

  The present paper documents the change in employment and wages between 2012 and 2020 when Prime Minister Shinzo Abe implemented his economic policy popularly known as Abenomics. Despite population aging that by itself would have decreased the employment rate by 2.8 percentage points, the aggregate...

• Income and Wealth Inequality in Asia and the Pacific: Trends, Causes, and Policy Remedies

  The Asia–Pacific region's rapid growth and poverty reduction in recent decades have been accompanied by rising income and wealth inequality. Technological progress, globalization, deregulation and market‐oriented reform, and financialization have generated many new opportunities, but rewarded...