Asian Journal of Applied Economics

Editorial Note

2024-05-28T05:17:57+07:00

This issue, Volume 31, No. 1 (January-June 2024), commemorates the 31st anniversary of the Asian Journal of Applied Economics (AJAE), a respected publication from the Faculty of Economics, Kasetsart University. It is remarkable how quickly time passes. For three decades, our journal has been consistently published, and we are now entering our 31st year of sharing research findings in economics and related disciplines. The journal's journey over the past 30 years has seen its share of challenges and triumphs. Positioned as an economic journal from Thailand and not indexed in Scopus, we have faced difficulties in attracting new submissions and boosting our publication and citation numbers amidst the proliferation of academic journals. Nevertheless, we remain committed to maintaining the high standards and timely publication of our articles. We greatly appreciate your ongoing support, whether you contribute as an author, reviewer, or reader.

In this January-June 2024 issue, we present a collection of seven articles that showcase a range of empirical findings in applied economics and related fields in business administration. These articles employ economic concepts and econometric methods through various case studies in Asia, offering valuable insights into Asian economies. The first two papers use panel regression models: one highlights the economic and social benefits of ICT in reducing inequality risks in Indonesia, and the other evaluates the impact of public expenditure on economic growth in India. The next four articles use micro-level data to explore research topics in China, Taiwan, Vietnam, and Lao PDR, respectively. These studies provide practical policy implications for promoting pro-environmental behavior, enhancing sport participation and well-being, understanding CEO characteristics and stock market performance, and analyzing consumer perceptions of organic vegetables. The final paper introduces an early warning system for debt rescheduling in ASEAN countries. The summaries of these articles are as shown in the PDF.

I am confident that the articles in this issue will greatly benefit both engaged readers and policymakers. I would like to extend my heartfelt appreciation to our late editor, Dr. Kanchana Sripruetkiat, who dedicated four years to our journal before moving on to new endeavors. Additionally, I am deeply grateful to the Center for Applied Economics Research (CAER) at the Faculty of Economics, Kasetsart University, for their unwavering support and sponsorship throughout the journal's production. Lastly, I would like to thank ChatGPT4o for assisting with the proofreading.

There is a small request we would like to make to our valued authors. Our journal does not charge any fees, and we are fortunate to have the support of the CAER. However, there are still costs involved in the review process. We kindly ask authors to respect our community by submitting manuscripts that are thoughtfully prepared. Please review the author guidelines on our website to help streamline the process and enhance your manuscript's quality.

AJAE remains committed to enhancing our standards, and we extend an open invitation for more articles within the realm of applied economics, particularly those offering pragmatic solutions to real-world challenges in the Asian context. For those considering publication in AJAE, we encourage you to submit your manuscripts via our online journal system (ThaiJo). All articles remain accessible through open access, and there are no associated fees throughout the entire process. For detailed author guidelines and submission instructions, please visit our website.

Can ICT Diffusion Reduce Income Inequality for a Better Life? Evidence from Indonesian Provinces

2024-03-18T05:56:35+07:00

This study examines the potential of ICT development to impact income inequality and economic development. While enhancing ICT infrastructure can broaden economic opportunities, it also has the potential to exacerbate wealth disparities among individuals with limited access. Utilizing panel data from 34 Indonesian provinces between 2012 and 2022, the study employs fixed effect and system GMM estimation methods to assess the relationship between ICT development and income inequality. The findings suggest that while ICT readiness tends to increase income inequality, the use of ICT and associated skills can mitigate it. Additionally, control variables such as wages and small/micro-enterprises show promise in reducing income inequality, whereas factors like life expectancy, population, and density tend to exacerbate it. The study concludes with implications for policymakers and stakeholders, emphasizing the importance of incorporating the social and economic benefits of ICT development into strategies aimed at reducing income inequality in Indonesia.

Threshold Impacts of Public Expenditure on Economic Growth: Insights from India Utilizing Panel Threshold Regression Model

2024-03-16T05:12:41+07:00

This research examines the impact of public expenditure dynamics on economic growth in India and its six distinct regions (North-Eastern, Northern, Western, Southern, Eastern, and Central) using Hansen's panel threshold regression model. Spanning from 1999–2000 to 2018–19, the analysis reveals significant inter-regional variations in the relationship between public expenditure and economic growth. The Northern, Western, and North-Eastern regions exhibit a singular threshold impact, indicating that exceeding this threshold level may not positively influence economic growth and could lead to fiscal imbalances. In contrast, the Central, Eastern, and Southern regions illustrate no threshold effect. Furthermore, the study identifies that the optimal expenditure threshold is higher for the North-eastern region (81.9%) compared to the Northern (60.5%) and Western regions (50.7%), reflecting higher expenditure requirements. Conversely, when considering India as a whole, no threshold effect is observed, indicating a consistent impact across all regions. The findings underscore the importance of policymakers' attention to optimal expenditure, crucial for addressing long-term budgetary imbalances and fostering inclusive growth.

The Influence of Economic Development and Government Investment on Pro-Environmental Behavior in China

2024-03-25T15:12:52+07:00

China’s pollution problem continues to worsen because of the nation’s rapid economic expansion. To improve the environment, governments need to allocate resources to environmental initiatives, enforce regulations, and facilitate collaboration in environmental management with public participation. This study analyzes the differences in Chinese public participation in environmental protection between the private and public spheres using the Chinese General Social Survey (CGSS) 2021. Multiple regression is employed to investigate the factors influencing Chinese pro-environmental behavior and to explore the connection between pro-environmental behavior, government investment, and economicdev elopment. The research shows that economic development has a favorable impact on pro-environmental behavior in the private sector. Government work effectiveness positively influences pro-environmental behavior, whereas government pollution governance in the public realm adversely impacts it. Economic development influences government pollution governance and the public’s pro-environmental behavior. Various elements, such as individual characteristics, the external environment, and social psychological components, have different levels of impact on the public’s pro-environmental behavior. The results will enhance understanding of Chinese environmental behaviors, enabling the creation of more effective policies to boost public participation and improve environmental management in China.

Effect of Sports Participation on Subjective Well-Being: Instrumental Variable Results from Microdata

2023-11-15T15:33:23+07:00

Policymakers worldwide have increasingly recognized the importance of sports participation, believing it enhances people’s quality of life, overall social welfare, and life satisfaction. This study utilizes individual-level data from Taiwan’s “Exercise Current Situation Survey” in 2019 to investigate the impact of sports participation on subjective well-being. We propose an individual’s perceptions of the government’s promotion of sports and the adequacy of sports facilities as instrumental variables (IVs), and a two-stage Poisson regression (2sPR) model is employed for analysis. The results indicate that sports participation has a significantly positive effect on personal subjective well-being. Regressions by gender revealed that men derive more well-being from sports participation than women do. Body mass index (BMI) and years of schooling have a positive and significant influence on subjective well-being. Conversely, respondents’ age, urbanization, and health status exhibit significant negative effects.

The Moderating Role of CEO Age on the Relationship Between CEO Characteristics and Tobin’s Q

2023-12-15T15:22:10+07:00

This study aims to analyze the impact of chief executive officer (CEO) characteristics (including gender, ownership, duality, and tenure) on the Tobin's Q value of firms, while considering the moderating role of the CEO’s age in this relationship. Tobin's Q is used as a variable to evaluate the market efficiency of listed companies. The data, comprising 380 listed companies on the Vietnam stock market from 2013-2022, were analyzed using pooled ordinary least squares (OLS), fixed effects model (FEM), and random effects model (REM) regressions. The results indicate that firms with male CEOs exhibit a negative effect on the Tobin’s Q value. Interestingly, companies with CEOs owning less than 1% of the stock demonstrate higher market efficiency compared to those with CEOs owning 1% or more. Conversely, dual CEOs have a negative effect on firms’ market performance. Furthermore, from a moderating perspective, CEO’s age strengthens the impact of CEO tenure on Tobin's Q value but weakens the effect of CEO duality on market efficiency. The findings suggest that listed companies should separate the CEO and board chairperson positions. Investors should pay closer attention to firms' governance structure and carefully consider CEO-related issues when making investment decisions to minimize risks and maximize returns. Additionally, the State Securities Commission must rigorously regulate listed companies that violate information disclosure guidelines for the stock market.

Consumer Perception and Willingness to Pay for Organic Vegetables in Savannakhet Province, Lao PDR

2024-03-30T13:21:06+07:00

Organic vegetables play a vital role in reducing exposure to harmful substances in food. This study aimed to assess consumer perceptions and willingness to pay (WTP) for organic vegetables, and identify factors influencing respondents' WTP for such vegetables in Savannakhet province, Lao PDR. A total of 368 respondents participated, with data collected using a structured questionnaire. Descriptive statistics, contingent valuation method, and logit models were employed for analysis. Results indicated that 60.30% of tested fresh vegetables were free from chemical contamination and toxins. High and moderate levels of chemical contamination were observed in only 6.25% and 25% of fresh vegetables, respectively. Approximately 35.29% of consumers reported regular weekly purchases of organic vegetables, with an average consumption of 3.78±2.45 kg/week, priced between 0.37 USD and 3.09 USD. Organic vegetables were favored for their perceived health benefits and quality, with 98.53% of consumers expressing future demand. The mean WTP for organic vegetables was found to be 1.14 USD per 1 kg. Bid premiums negatively impacted WTP for lettuce, glory, and mints products, while occupation exhibited a negative correlation with WTP for Chinese cabbage and onion.

Modelling Early Warning System for Debt Rescheduling in ASEAN Countries

2023-12-02T15:50:46+07:00

This study aims to develop an early warning system for debt rescheduling in ASEAN countries by utilizing yearly time series data from 1999 to 2019. The logit model is employed to construct the early warning system for debt rescheduling in ASEAN countries, with debt rescheduled data collected from The World Bank’s International Debt Statistics database. The empirical results indicate that the early warning system model for debt rescheduling in ASEAN countries should comprise four variables: the unemployment rate, concessional debt to total debt, external debt over GDP, and international reserve to short-term debt. Interestingly, when setting the cutoff value at 0.5, the model demonstrates high predictive accuracy, with a Type II error rate of 10 percent and a Type I error rate of only 4.1 percent. Overall, the early warning system model for debt rescheduling in ASEAN countries appears capable of correctly predicting events 80 times out of 84.