Souvenir Program - Philippine Economic Society · PDF fileSouvenir Program 45th Annual Meeting...

Souvenir Program

45th Annual Meeting14-16 November 2007

Bangko Sentral ng Pilipinas

PES_souvenir.indd 1 11/7/07 5:33:10 PM

Message from the BSP Governor

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M E S S A G E

Th e Bangko Sentral ng Pilipinas is honored once again to co-sponsor the Annual Meeting of the Philippine Economic Society (PES), which is now in its 45th year. Th e PES Annual Meeting has always been the preeminent venue for the discussion and dissemination of research among economists in the Philippines. It has also become one of the foremost gatherings of the profession in the region.

It is, therefore, with keen interest that we look foreward to today’s discussions under the umbrella of “Revitalizing Investments Towards Sustained Economic Growth.” Th e Philippine economy has experienced continued growth over the past fi ve years. Th e collective challenge that we now face is ensuring sustained, robust and broad-based growth over the long-term to benefi t all Filipinos. To this end, we need to fi nd ways to revitalize key sectors in the economy, such as manufacturing, energy and mining, and strengthen their productivity and ability to compete globally. We also need to develop the capital markets in order to harness the ample liquidity in the fi nancial system to help raise the long-term potential of the economy.

However, the road ahead of us does not stop with economic growth. Other important challenges confront the practice of economics in the Philippines today. We need to address the impact of the increasing pattern of labor migration on the economy with a view to minimizing the costs and maximizing the benefi ts. Th is would imply, among other things, putting the income transfers from overseas labor to productive use through savings mobilization and investments. We also need to be mindful of the socio-economic challenges to our society, particularly the need to address poverty that continues to affl ict a third of our population. Poverty alleviation is critical for more inclusive and participatory development as well as for social cohesion.

Th e old maxim that problems are opportunities in disguise still holds true. Th e pressing economic concerns of our times continue to provide academics, private economists, and policymakers alike with plenty of opportunities in terms of new research and improved policy design. What is crucial is that we keep asking the right questions, and keep searching for the right answers. Th is will help us tackle policy challenges boldly through purposeful action that will steer the economy on a path to sustainable and more rapid expansion, while making sure that no Filipino is left behind.

AMANDO M. TETANGCO, JR.Governor


Message from the PES President

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M E S S A G E

Welcome to the 45th Annual Meeting of the Philippine Economic Society, which promises to be a grand celebration of economics—as a science (at least in the sense of being a body of knowledge), a way of thinking, a tool for policy analysis, …, and, not least, as the art that men and women of “tough minds and soft hearts” practice, oftentimes with liberal drawings from the proverbial bag of “economic tricks,” to improve the lives of all.

And if this fête raises the inveterate heckler’s “But if you’re so smart, why aren’t we rich?” question, let us invite him to join us in discussions on the conference theme. Accelerating and Sustaining Economic Growth toward Broad-Based Development turns a brave and hopeful face to the future despite the limited bases for an economic takeoff and runways littered with detritus from weak (if not crumbling and mangled) institutions. Let us invite him to a spirited exchange of ideas on how to build trustworthiness in leaders and institutions, foster a citizenry that is engaged in the aff airs of the nation, eradicate predation in economic activities, and establish a meritocratic society in which there is equal opportunity for all.

After all, economists may not have all the answers, but they do pose interesting, challenging, and soul-searching questions.

A fi nal, fond word: To our donors and sponsors, resource persons, members, and friends, thank you for your generous and abiding support, which allows the Society to stage these “public-good coordination games” that are becoming bigger and more impressive by the year. Hopefully, the spillover externalities of the event are such that the costs of your individual contributions are much exceeded by the gross payoff s to each and every one.

MICHAEL M. ALBAPresident


Th e Philippine Economic Society (PES) was established in August 1962 as a nonstock, nonprofi t professional organization of ECONOMISTS.

Over the years, the Society has served as one of the strongest networks of economists in the academe, government, and business sector.

Recognized in the international community of professional economic associations and a founding member of the Federation of Asean Economic Associations (FAEA), the PES is truly a signifi cant national and international institution.

Th e PES continuously provides a venue for open and free discussions of a wide range of policy issues through its conferences and symposia.

Th rough its journal, the Philippine Review of Economics, which it jointly publishes with the UP School of Economics, the Society performs a major role in improving the standard of economic research in the country and in disseminating new research fi ndings.

For more information about the Society, please visit its website www.phileconsociety.org.

PES SECRETARIATAsia-Pacifi c Policy CenterRms. 303-304, Philippine Social Science CenterCommonwealth AvenueQuezon CityTelefax: 926.4615email: [email protected]

Philippine Economic

Society (PES)

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ConferenceProgram

45th Annual Meeting14-16 November 2007


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45th Annual Meeting14 November 2007

Day 1. Wednesday, 14 NovemberMaster of Ceremonies

TERESO TULLAO, JR.De La Salle University

08:00 AM REGISTRATION

09:00 AM OPENING CEREMONY

• Pambansang Awit ng Pilipinas

• Welcome RemarksAMANDO M. TETANGCO, JR.Governor, Bangko Sentral ng Pilpinas

• Opening RemarksMICHAEL M. ALBAPresident, Philippine Economic Society

09:30 AM KEYNOTE SPEECH

• Achieving broad-based developmentSENEN C. BACANIPresident, La Frutera, IncEntrepreneur of the Year 2006

10:00 AM COFFEE BREAK

10:30 AM PLENARY SESSION 1

• Sustaining economic growth in the long-run

Moderator

PETER LEE UUniversity of Asia & the Pacifi c

Panelists

DANTE CANLASSchool of Economics, University of the Philippines

Constraints to long-run growth in the Philippines

JONG-WHA LEEAsian Development Bank

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JEHAN ARULPRAGASAMWorld Bank

SAMIE LIMPhilippine Chamber of Commerce & Industry

12:00 NN LUNCHHosted byFriedrich Naumann Foundation

Luncheon Speaker

SIEGFRIED HERZOGFriedrich Naumann Foundation

01:30 PM PARALLEL PANELS 1

A. Trade: Regional & economic integration

Organizer

GEORGE MANZANOUniversity of Asia & the Pacifi c

Panelists

EDSEL BEJAAteneo de Manila University

On the relevance of export-led growth to the Philippines

ELIZABETH TANAteneo de Manila University

Regionalism in East Asia: Th e ASEAN +1 initiative

GLORA PASADILLAPhilippine Institute for Development Studies

Rethinking FTAs

B. Economics Education

Organizer

AGHAM CUEVASUniversity of the Philippines-Los Banos

Moderator

JOSE V. CAMACHOUniversity of the Philippines

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Panelists

AMELIA BELLORODGER VALIENTESUniversity of the Philippines-Los Banos

Grade infl ation: Fact or myth?

CHRISBELLE DIMAPILISNIÑO ALEJANDRO MANALOUniversity of the Philippines-Los Banos

A review of tertiary economics education in selected higher education institutions in the Philippines

WALFRIDO BELENAteneo de Manila Unviversity

Discussant

ALITA ROXASMSU-Iligan Insittute of Technology

C. Environment: Economics of mining

Organizer

FILOMENO STA. ANA IIIAction for Economic Reform

Panelists

ROLANDO PEÑAConsultant, Lepanto Mines

Mining investments in the Philippines: Strategic issues

ART BOQUIRENUniversity of the Philippines-Baguio

Cost-benefi t case study of mining in Benguet communities

MARVIC LEONENCollege of Law, University of the Philippines

Law and economics of mining

RINA ROSALES

Resource valuation in relation to mining


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D. Competitiveness and productivity

Organizer

EPICTETUS PATALINGHUGCollege of Business AdministrationUniversity of the Philippines

Panelists

TERESA DUEÑASUniversity of Maastricht

Firm-level determinants of export performance: Evidence from the Philippines

SANTOS JOSE DACANAY IIIUniversity of the Philippines-Baguio

Profit and cost efficiency of Philippine commercial banks under periods of liberalization, crisis and consolidation

NICETO POBLADORKalayaan College

Th e changing face of competition

CYRUS PAULO BUENAFEHewlett-Packard Philippines

A way of determining the best evolution path for export industries using product spaces

E. Philippine growth statistics: How credible are they?

Organizer

WINFRED VILLAMILDe La Salle University

Moderator

CELIA REYESPhilippine Institute for Development Studies

Panelists

FELIPE MEDALLASchool of Economics, University of the Philippines

VICENTE VALDEPEÑASBangko Sentral ng Pilipinas

LOURDES HOMECILLONational Statistics Offi ce

Discussant

ESTRELLA DOMINGONational Statistical Coordination Board

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F. Local government fi nancial planning and management

Organizer

LEONARDO LANZONAAteneo de Manila University

Panelists

RAYMUND FABREEPRA-Ateneo de Manila University

Introductory note: Highlights of accomplishments of the sector

RUFO MENDOZAAteneo School of Government

Benchmarking study: Local fi nancial management framework for good governance

FLORECITA FLORESLocal Government Research & Consultancy Service

Situs of the tax: A study of its implementation

G. Monetary reforms 1

Organizer

FRANCIS DAKILA, JR.Bangko Sentral ng Pilipinas

Panelists

MA. CYD TUAÑO-AMADORRACQUEL CLAVERIAFERNIDAND COVIC DELLOROBangko Sentral ng Pilipinas

Philippine overseas workers and migrants’ remittances: Th e Dutch Disease question and the cyclicality issue

FRANCIS DAKILA, JR.RACQUEL CLAVERIABangko Sentral ng Pilipinas

Identifying the determinants of overseas Filipinos’ remittances: Which exchange rate is most relevant?

AGNES YAPCRISTETA BAGSICBangko Sentral ng Pilipinas

Adjustments in the face of peso volatility: Perspectives from the past and policy directions


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03:00 PM COFFEE BREAK

03:30 PM PARALLEL PANELS 2

H. Health

Organizer

JOSEPH CAPUNOSchool of Economics, University of the Philippines

Panelists

ALELI KRAFTJOSEPH CAPUNOSTELLA QUIMBOCARLOS ANTONIO TAN, JR.School of Economics, University of the Philippines

Information, incentives and practice patterns: Th e case of TB DOTS services and private physicians in the Philippines

CARLOS ANTONIO TAN, JR.RUTH FRANCISCOMARIFE BACATESchool of Economics, University of the Philippines

Do unintended pregnancies adversely aff ect the use of facility-based delivery care?

JHIEDON FLORENTINOSchool of Economics, University of the Philippines

Underuse of insurance benefi ts among the poor: Prevalence and consequences

I. Financial markets development

Organizers


Moderator

ZENO ABENOJABangko Sentral ng Pilipinas

Panelists

KAREN TECSONEPRA - ADMU

A stakeholder analysis on the initiative to harmonize/integrate regulatory functions of the Bangko Sentral ng Pilipinas, Securities & Exchange Commission, and the Insurance Commission


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ROSEMARIE EDILLONAsia-Pacifi c Policy Center

Th e consumer fi nance survey

Discussants

ANGELO UNITEDe La Salle University

EMMANUEL GUINARural Bank Association of the Philippines

J. Energy

Organizer

PETER LEE UUniversity of Asia & the Pacifi c

Panelists

ANNA WHITEHOUSETotal Philippines Corporation

ZENAIDA MONSADADepartment of Energy

RAYMOND TANDe La Salle University

Bioenergy from a system level perspective

K. Urban and land issues

Organizer

ARTURO CORPUZAyala Land Inc.

Panelists

MARIFE BALLESTEROSPhilippine Institute for Development Studies

Land administration and management issues: Implications on CARP

PATRICK GERARD SIMON KINGAteneo de Manila University

A primer on land administration in the Philippines and the Mango Avenue project

Discussant

JAIME CURAChamber of Real Estate & Builders Association


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L. Regulation and development

Organizer

MICHAEL ALBADe La Salle University

Panelists

RAUL FABELLASchool of Economics, University of the Philippines

Regulation and competition policy: Empowering the market and growth in LDCs

MA. JOY ABRENICASchool of Economics, University of the Philippines

Understanding the logic of predatory pricing

MARVIC LEONENCollege of Law, University of the Philippines

LOURDES MONTENEGROUniversity of San Carlos

Determinants of compliance to water pollution standards in Central Visayas

M. Monetary reforms 2

Organizer


Panelists

ELOISE GLINDROBangko Sentral ng Pilipinas

Are Asian housing prices too high for comfort?

HAYDEE RAMONBangko Sentral ng Pilipinas

Forecasting the volatility of Philippine infl ation using GARCH models

JADE ERIC REDOBLADOBangko Sentral ng Pilipinas

Policy considerations in the light of oil price volatility


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N. Student papers

Organizer

MARK ALVIN BAQUIRANSan Beda College

Panelists

RONALDO ICOSchool of Economics, University of the Philippines

Catastrophic health care, poverty and impoverishment in the Philippines

MIGUEL ROBERTO BORROMEOJESUS CARLOS CASTILLOELEAZAR LOPEZ, JR.De La Salle University

Selected demographic variables aff ecting the educational attainment of children in the Philippines

DARYL RUIZAteneo de Manila University


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Day 2. Th ursday, 15 NovemberMaster of Ceremonies

FERNANDO ALDABAAteneo de Manila University



• Pushing Philippine manufacturing towards sustained growth

Moderator

ARTURO CORPUZAyala Land, Inc.

Panelists

PONCIANO INTAL, JR.Angelo King Institute, De La Salle University

Sustaining the manufacturing sector

NORBERTO VIERATexas Instruments

MA. FLORDELIS AGUENZAPlanters Development Bank

Financing SMEs in the manufacturing sector



• Poverty, population, and the labor market

Moderator


Panelists

ERNESTO PERNIASchool of Economics, University of the Philippines

Population as public interest

HYUN SONAsian Development Bank

Analysis on poverty, equity and labor market in the Philippines


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RANA HASANKARL JANDOCAsian Development Bank

Occupational dynamics and workers’ welfare: Th e Philippines before and after the Asian fi nancial crisis

RAUL FABELLASchool of Economics, University of the Philippines

12:OO NN LUNCHHosted byBangko Sentral ng Pilipinas

• President’s ReportMICHAEL ALBAPresident, Philippine Economic Society

02:00 PM NOBEL LAUREATE TALK

• Economic development by fi tting globalization into the national development strategy

ROBERT MUNDELLColumbia University

Sponsored by“Bridges – Dialogues towards a culture of Peace” Program of the International Peace foundation

Hosted byDe La Salle University with the Mapua Institute of Technology

VenueTeresa Yuchengco Tower7F Yuchengco BuildingDLSU Campus, Taft Avenue, Manila


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Day 3. Friday, 16 NovemberMaster of Ceremonies

WINFRED VILLAMILDe La Salle Universityv



• Labor and migration development

Moderator

MELLY PARAISO Polytechnic University of the Philippines

Panelists

MANOLO ABELLAInternational Labor Organization

Migration and development: Still an unsettled relationship

RAUL DELGADO-WISEUniversity of Zacatecas, Mexico

Labor migration and development: Lessons from the Mexican experience

MICHAEL ALBADe La Salle University

Th e determinants of Filipino overseas workers’ remittances: Some preliminary fi ndings

FABIO BAGGIOScalabrini Migration Center

Factoring in the social dimensions of international labor migration: Th e Philippine experience



• Fearless forecast for 2008: Th e take-off ?

Moderator

MYRNA AUSTRIADe La Salle University

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Panelists

JAMES MCCORMACKFitch Ratings

SIN BENG ONGJP Morgan

CIELITO HABITOAteneo de Manila University

Growing at 7.5 percent: Too good to be true, too good to last?

VICTOR ABOLAUniversity of Asia & the Pacifi c

12:OO NN LUNCHHosted byTh e Asia Foundation

Luncheon Speaker

STEVE ROODTh e Asia Foundation

• Announcement of the results of the PES election

• Closing RemarksFERNANDO ALDABAChairman, Organizing Committee


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Abstracts and Curriculum Vitae

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KEYNOTE SPEECH

Achieving broad-based development

SENEN C. BACANI

Senen C. Bacani was awarded the SGV Ernest & Young Enterpreneur of the Year in 2006, for his achievements as chairman and president of La Frutera, Inc.

Mr. Bacani graduated summa cum laude from De La Salle University, with a degree in commerce. After finishing his MBA from the University of Hawaii East West Center, he joined Dole Food Co., where he rose to become country manager in Costa Rica and in the Philippines.

Mr. Bacani served as secretary of agriculture under President Corazon Aquino. In 1993, he established Ultrex Management & Investments Corp. which, in 1996, partnered with Chiquita Unifrutti to form La Frutera, Inc., a 1,000-hectare banana plantation in the Autonomous Region of Muslim Mindanao (ARMM).

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Abstracts & Curriculum Vitae

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PLENARY SESSION 1Sustaining economic growth in the long run

Constraints to long-run growth in the PhilippinesDANTE CANLAS

School of Economics, University of the Philippines

Using a growth decomposition framework based on a Cobb-Douglas production function that shows constant returns to scale, it is seen that much of the growth in real per capita gross domestic product (GDP) in the Philippines is due to an increase in the capital-labor ratio, and hardly any from technological progress. Such growth is not sustainable. It helps explain why Th ailand overtook the Philippines in real per capita GDP level in the early 1980s. At the Philippines’ current per capita growth rate, it stands no chance of catching up with the middle-income countries in Southeast Asia and the newly industrializing economies in East Asia.

Dante B. Canlas is a professor of economics at the School of Economics, University of the Philippines, Diliman, Quezon City. He obtained his B.S. (Mathematics) in 1967 and his Ph.D. (Economics) in 1978, both at the University of the Philippines.

He has held visiting appointments at Princeton University (New Jersey), Institute of Developing Economies (Tokyo), and Northern Illinois University (De Kalb).

Dr. Canlas served in the national government as Deputy Director-General at the National Economic and Development Authority (NEDA) from 1992-98 and NEDA Director-General, concurrently Secretary of Socio-Economic Planning from 2001-2002. He also served as Executive Director of the Asian Development Bank from 2003-2004.

He has written more than 70 articles in macroeconomics, labor, and money.

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JONG-WHA LEEAsian Development Bank

We assess East Asia’s growth experience in a broad historical and international context. East Asian countries grow faster than the rest of the world for the last four decades. Th e growth performance can largely be attributed to the strong fundamental growth factors such as investment rate, human resources, fertility, institutional quality, macroeconomic stability, and the degree of trade openness. We extend the discussion on growth determinants to the role of balance of payment crisis, income distribution and the quality of education.

Jong-Wha Lee is the Head of the Asian Development Bank’s Office of Regional Economic Integration (OREI), assuming office in March 2007.

Dr. Lee has over 20 years of professional experience as an economist and an academic. He worked as Economist at the International Monetary Fund and taught at Harvard University as a Visiting Professor. He had served as a consultant to the Asian Development Bank, the Harvard Institute for International Development, the Inter-American Development, the International Monetary Fund, and the United Nations Development Programme, and the World Bank. He also served as a member of the National Economic Advisory Council for the President of the Republic of Korea.

Prior to his current appointment, Dr. Lee was the Director of the International Center for Korean Studies and a Professor of Economics at Korea University. He has published numerous books and reviewed journal articles in English and Korean, especially on topics relating to human capital, growth, financial crisis, and economic integration.

Dr. Lee, a national of the Republic of Korea, obtained his Ph.D. and Master’s degree in economics from Harvard University, and his Master’s and Bachelor’s degrees in economics from Korea University in Seoul.

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PARALLEL PANEL ATrade: Regional & economic integration

On the relevance of export-led growth in the PhilippinesEDSEL BEJA, JR.

Ateneo de Manila University

Th e history of development may be summarized into four stylized facts, called Kaldor Laws: 1) the manufacturing sector is the engine of economic growth; 2) increasing returns exists in the manufacturing sector; 3) manufacturing sector growth absorbs the surplus labor in the non-manufacturing sector, increasing the productivity in the latter; and 4) as the economy matures, the external sector becomes the ultimate constraint to long-term economic growth. Following this Kaldorian logic, the paper presents an analysis on the fi rst and fourth Kaldor Laws to explain why export-led growth remains an important strategy in the realization of the long-desired robust economic growth in the Philippines.

Edsel Beja, Jr. is deputy director of the Ateneo Center for Research and Development. He is also an assistant professor in the economics department and a research fellow at the Institute of Philippine Culture of the Ateneo de Manila University.

Dr. Beja completed his PhD in economics at the University of Massachusetts Amherst, and his master of philosophy degree in geography from the University of Cambridge. He finished his MA as well as BA in economics at the Ateneo de Manila University.

Dr. Beja’s project “Never Again to a Crisis: The Costs of the 1997 Asian Financial Crisis” was recognized with the IPC (Institute of Philippine Culture) Merit Research Award for 2007-2008, while his project “The Philippines on Debt Row” is the Loyola Schools Faculty Research grantee for 2007-2008.

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Regionalism in East Asia:The ASEAN +1 initiative

ELIZABETH TANAteneo de Manila University

FTAs have been proliferating in Asia since the late 90s and show no sign of abating. Asia, in particular East Asia must harness the strong regional sentiments and harness it into a potential regional trade block. Th e ASEAN+ 3 model should ideally serve as the starting point because of existing linkages in the real and monetary sectors. Nevertheless, what has taken off are the ASEAN +1 Initiatives, each moving at diff erent speed and covering wide and varied areas of liberalizaton. What are their common characteristics and diff erences? Can these initiatives complement the multilateral process of liberalization?

Elizabeth Tan is currently a lecturer at the Ateneo de Manila University. She holds an MA in economics from the University of the Philippines, and has an AB in economics magna cum laude, from the University of San Carlos in Cebu. She also attended the annual program in world banking and finance at the Economics Institute, Boulder, Colorado.

Ms. Tan has held various positions with the Asian Development Bank, the Philippine Institute for Development Studies, and other institutions. Her work experiences include the Philippines, the People’s Republic of China, Korea, Vietnam, and the central Asian republics.

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GLORIA PASADILLA

Gloria Pasadilla is a senior research fellow at the Philippine Institute for Development Studies, as well as an APEC convenor with the group on subservices forum and lead negotiator for services in the ASEAN-ANZ FTA negotiations.

Her areas of interest include international trade, financial services and international legal framework, regional integration, political economy, international macroeconomics, banking, and insolvency.

Dr. Pasadilla obtained her Ph.D. (Economics) at New York University. She also holds a Master of International Law and Economics (summa cum laude) from the World Trade Institute, University of Bern, Switzerland, and an M.S. (Industrial Economics) from the Center for Research and Communication. Her B.S. degree is in Mathematics, from the University of the Philippines.

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PARALLEL PANEL BEconomics Education

Grade inflation: Fact or myth?AMELIA BELLO

University of the Philippines-Los Banos

RODGER VALIENTESUniversity of the Philippines-Los Banos

Real grade infl ation is the upward shift in students’ grades without a similar rise in achievement (Kohn, 2002; Rosovsky and Hartley, 2002). It means that the same work that was given a 2.0 in the past is getting, for example, a 1.5 today. Th e term implies a decline in grade standards and obscures the role of grades as a signal for students’ academic ability.

In the debate about grade infl ation, discussion about the purpose of grading is absent. Guskey (2003) believes that resolving the problem depends on clarifying the purpose and meaning of grades. Two diff erent views of grading are proposed, each one leading to diff erent approaches to instruction and grading policies. Grades may be either used to discriminate among students and identify diff erences in performance or grades may be thought of as refl ecting the degree to which students have learned. Th e fi rst leads to some way to rank the students and the assigning of grades according to each student’s relative standing. Th e second argues that education is a purposeful activity in which teachers exert their best to have students learn. In this case, teachers need to clarify the learning criteria and the goal becomes to nurture talent and not to discriminate and sort.

Th e research attempts to empirically validate the presence of grade infl ation in economics courses off ered by the Department of Economics, University of the Philippines Los Baños. Using grades from 1986-2005, an upward trend is seen in 10 out of 18 courses off ered. However, the source of this uptrend could not be pinpointed. Further studies relating admission requirements, curricular changes and teaching evaluation/faculty complement as well as the mechanics of grading to the actual grades must be conducted. Only then can a more defi nitive conclusion of whether real grade infl ation exists or not can be made.

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A review of tertiary economics education in selected higher education institutions in the Philippines

CHRISBELLE DIMAPILISUniversity of the Philippines-Los Banos

Studies on Tertiary Economics Education in the Philippines are still in its infancy stage. Th e database as well as measures of assessing the inputs and outputs of Economics Education are not yet established. Th is study is an attempt to start reviewing what the state of Economics Education is, starting initially with fi ve selected Higher Education Institutions (HEIs). Th e fi ve HEIs are the University of the Philippines Los Baños and the University of the Philippnes Diliman for the public HEIs, and Ateneo de Manila University, De La Salle University and Colegio de Los Baños for the private HEIs. Th e Economics curriculum of San Beda College was included in the study but only in the analysis of the curriculum. Th e Commission on Higher Education (CHED) standard Economics curriculum was used as the benchmark for comparison.

Th e study is highly exploratory and descriptive. Th e study looked at the following as the inputs to Economics Education: curriculum, facilities, faculty composition, average class size, and textbooks used; while the measures of output were the average number of enrollees, average number of graduates, mean weighted average of students, and number of honor graduates.

Not all HEIs complied with the CHED standards of required Economics subjects. However, all the HEIs have the facilities to aid them in teaching. Th e average class size was 40 students. All the prescribed textbooks were acquired by four of the HEIs. Th e faculty composition was 50% PhD and MA/MS holders. Data on output could not be assessed accurately inasmuch as the only available information was number of enrollees and graduates, and mean grade and percentage of honor graduates. Due to diff erences in the nature of the data, a direct comparison of these outputs could not be carried out.

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PARALLEL PANEL CEnvironment: Economics of mining

Mining investments in the Philippines: Strategic issuesROLANDO PEÑAConsultant, Lepanto Mines

After almost 10 years since the passage of the 1995 Philippine Mining Act, the mineral industry in the Philippines had yet to take off . To demonstrate support by the national government in promoting the mining industry, Executive Order 270 was issued in January 2004 entitled “National Policy Agenda on Revitalizing Mining in the Philippines.”

Since the issuance of this policy document, global demand for strategic and valuable metals perked up, giving an unprecedented boost to the value of production of the existing mines in the Philippines. In the wake of high metal prices, foreign and local investors expressed renewed interest in mining in the Philippines. Although the Philippine is imbued with rich mineral resources, these are fi nite resources that can only accommodate so much investors. For all the “attractions” dangled before investors, the government is hard put in accommodating them.

Although the value of metallic production showed a hefty increase in 2006 compared to the previous years, this was mostly the result of increased prices of metals and not to development and production of new mines. New investments in the metallic mineral industry are drawn to four major products: gold, copper, chromite and nickel. As of the end of last year, there were only 18 operating metallic mines, compared to 17 in the previous year (there were 14 in 2003). Th ere are only two FTAAs that were approved by the government in 1994. As of the end of 2006, there were only 209 approved MPSAs, compared to 164 in 2002. Of these 65 were cancelled by DENR for remaining idle. On the other hand there were 1,318 MPSA applications being processed in 2006, compared to 1,529 in 2002. In the case of Exploration Permits, there were 33 approved permits as of 2006, compared to 720 applications being processed in 2006.

In view of these developments, what the mineral industry needs is a more rational strategic approach. Th is would include, but not limited to, the following for consideration:

• Industrialization promotion through value-adding in the mineral industry

• Cleansing of idle tenements

• Addition of new category of medium scale mining as an upgrade from small scale mining that would allow the use of equipment and explosives

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Cost-benefit case study of mining in Benguet communitiesART BOQUIREN

University of the Philippines-Baguio

Th e paper examines whether mining communities in Benguet are better off or inferior compared to non-mining communities. Th e conclusion on the matter based on latest available data (2006) is that mining communities are inferior. Data even suggest that mining communities are laggards in development. Th e paper for PES will use the latest available data and see if the conclusions are robust or consistent over time.

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PARALLEL PANEL DCompetitiveness and productivity

Firm-level determinants of export performance: Evidence from the Philippines

TERESA DUEÑASUniversity of Maastricht

Th e paper determines the factors aff ecting the export performance of fi rms in three main manufacturing sectors in the Philippines. Specifi cally, fi rm-level characteristics such as fi rm size, fi rm age and foreign affi liation are identifi ed and statistically tested to determine whether or not it aff ects a fi rm’s capability to export. Th e study uses a novel econometric model which specifi cally addresses fractional response behavior and estimates said model using a modifi ed quasi-maximum likelihood procedure. Among the fi rm-level characteristics tested, foreign affi liation has the most prominent infl uence on a fi rm’s propensity to export in the Philippines.

Teresa Dueñas works for the International Affairs Group of the Bangko Sentral ng Pilipinas. Her research areas include the economics of technology and technological change, trade and technology, and macro-economics.

Ms. Dueñas is currently working on her doctoral dissertation for her PhD in economics from the United Nations University in Maastricht, the Netherlands. She holds a diploma in advanced international trade from the Kiel Institute of World Economics, Germany. Her masters in economics as well as her BS in business economics were earned at the University of the Philippines in Diliman.

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Profit and cost efficiency of Philippine commercial banks under periods of liberalization, crisis and consolidation

SANTOS JOSE DACANAY IIIUniversity of the Philippines-Baguio

Th is paper examines the profi t and cost effi ciency of commercial banks in the Philippines from 1992-2004—covering periods of fi nancial liberalization, crisis and consolidation. Two-stage procedure is employed. Th e fi rst method involves the estimation of profi t and cost effi ciency using the stochastic frontier approach. Results indicate that profi t effi ciency slowly decreased from a mean score of 92% in 1992 to 84% in 2004 while cost ineffi ciency hovers around 11% to 12% from 1992 to 1998, and then jumps to 14% to 15% from 1998 to 2004. Effi ciencies are found to be inversely related to asset size. Off -balance sheet services are found to be cost-absorbing, and substitute for traditional banking products. Elasticities of the prices of labor and deposits are found to be negative, providing evidence for the use of more and low-cost labor and the abundance of deposits as cheap source of funds. In the second stage, regression shows profi t effi ciency scores of universal banks are signifi cantly higher than plain commercial banks, suggesting scope economies from expanded and equity investment activities of universal banks. Foreign banks are more cost ineffi cient due to higher personnel cost. Modest improvement in bank effi ciency after liberalization in 1994 is registered but cost ineffi ciency increased in the aftermath of the Asian fi nancial crisis. Acquired banks in mergers are not necessarily ineffi cient, and the weighted effi ciency scores of the acquired and surviving banks before the merger have not improved three years after the merger, suggesting that synergy gains need a longer time to be realized.

Santos Jose Dacanay III is an assistant professor of management at the Institute of Management, University of the Philippines-Baguio.

Dr. Dacanay has a PhD in business administration and a diploma in urban and regional planning from the University of the Philippines. He finished his MBA at St. Louis College, and obtained his BS in business administration from the University of the Philippines.

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31



The changing face of competitionNICETO POBLADOR

Kalayaan College

Th is paper looks closely at the concept of competition in the context of today’s information-driven business environment. After briefl y discussing the place of competition in economic theory and in traditional corporate strategy, the paper argues that in a world of relentless and unpredictable change, competitive advantage has become increasingly unsustainable. In such a complex and uncertain world, competing for market dominance no longer makes sense, and that the better strategy is for fi rms to position themselves in markets that are yet evolving. It contends that such a strategy requires continuous innovation in products and processes, and that the ability to adapt to continuously evolving markets depends less on “core competencies” than on the creative management of extended value networks. Implications on anti-trust policy and on the treatment of Intellectual Property Rights will be explored.

Niceto Poblador holds a Ph.D. from the University of Pennsylvania and obtained his M.A. from the University of Chicago. He spent most of his academic life at the University of the Philippines, with teaching stints at the National University of Singapore and the City University of Hong Kong.

Among his recent publications are “The Economics of the Firm: Managerial Applications, and Strategy Demythicized: Why Today’s Business Models Fail to Deliver.” He is currently editing a forthcoming publication of the Management Association of the Philippines entitled “Strong Vision, Bold Decisions: Responding to Emergent Global Challenges.” He lectures, writes and consults on the economics of strategy and on Knowledge Management.

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32



A way of determining the best evolution path for export industries using product space

CYRUS PAULO BUENAFEHewlett-Packard Services

A deterministic method was developed in fi nding the best evolution path that a country’s particular export industry will evolve or transition into another export industry. Th e problem was framed as a shortest-path problem particularly known in graph theory literature. A concept on a typical probability graph was defi ned and a shortest-path algorithm ws formulated for this purpose. Th e data used by Hidalgo et al (2007) was used and reconstructed using the probability graph concept in order to derive the maximum joing probability path of export industry evolution given an originating export industry and a target export industry.

Cyrus Paolo Buenafe is a Technology Consultant for HP Services under Portfolio, Marketing and Alliances (Portfolio Engineering), specializing in enterprise applications such as SAP, Siebel and Oracle. He has a Master of Science in Information Technology from the University of Asia and the Pacific and a Master of Arts in Economics from Ateneo de Manila University. He is currently finishing his Doctor of Philosophy in Economics, also from Ateneo de Manila University.

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33



PARALLEL PANEL EPhilippine growth statistics:How credible are they?

VICENTE VALDEPEÑASBangko Sentral ng Pilipinas

Mandate, task and composition of the Special Committee to Review the Philippine Statistical System. Dimensions of review, evaluation and recommendation. Initial fi ndings.

• • • • •

LOURDES V. HOMECILLO

Lourdes V. Homecillo is currently the chief of the Industry Statistics Division, Industry and Trade Statistics Department of the National Statistics Office. She is currently involved in the compilation of the Industrial Production Index and Producer Price Index, as well as the compilation of economic statistics from economic censuses and surveys.

Currently studying in the DBA program of De La Salle University, Ms. Homecillo has an MBA from the Philippine Christian University. Her BS is in chemical engineering from the University of Santo Tomas.

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34



PARALLEL PANEL FLocal government fi nancial planning and management

Benchmarking local financial nanagement frameworks for good governance

RUFO MENDOZAAteneo School of Government

Th e need to establish benchmarks in the area of local fi nancial management (LFM) is evident and real. Th e project seeks to develop benchmarks in the various areas of LFM that will facilitate more eff ective governance of local government units, thereby keeping them in harmony with their mandates while at the same time satisfying their constituents in terms of service delivery. In addition, the project aims to identify the good practices necessary for eff ective LFM in the context of good governance and in light of local and international developments in the fi eld.

Rufo R. Mendoza is a practicing public accountant with accreditation from the Board of Accountancy, Securities and Exchange Commission, Bangko Sentral ng Pilipinas, and the Bureau of Internal Revenue. He is currently affiliated as lecturer at the Ateneo School of Government and at the UP Open University, as member of the Professional Regulatory Board of Accountancy of the Professional Regulatory Commission, and as the National President of the Association of Government Internal Auditors.

Dr. Mendoza has a PhD in Community Development/Agribusiness Management from UP Los Banos and also holds a Master’s degree in Development Management from the same university. He also earned his MBA from the Ateneo de Manila University.

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35



A Study of legal deductions on the Internal Revenue Allotment for local government units

FLORECITA FLORESLocal Government Research & Consultancy Service

Th is brief surveys laws pertaining to the internal revenue allotment (IRA) scheme, including the legal bases for deductions from the IRA by the Bureau of Internal Revenue and Department of Budget and Management, National Government restrictions and reductions of the IRA, and issues such as the Local Government Service Equalization Fund, IRA lien and the monetization program.

Atty. Florecita Flores is a tax expert and a practicing lawyer. For some time, she served as investment ombudsman under the Department of Trade and Industry and as the Director-General of the Philippine Chamber of Commerce and Industry. She has varied involvements in national and local taxation including the PCCI-BIR Committee on Taxation and in the Oversight Committee of the Local Government Code of 1991.

Atty. Flores obtained her LLB from the University of the Philippines. She also attended graduate studies in development economics in the same university.

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36



PARALLEL PANEL GMonetary Reforms 1

Identifying the determinants of overseas Filipinos’ remittances: Which exchange rate is most relevant


RACQUEL CLAVERIABangko Sentral ng Pilipinas

Th e study considers which exchange rate measure is the most relevant determinant of overseas Filipinos (OF) remittances. Th e study employs a microeconomic framework (involving a utility maximizing household) to help form the basis for selection of variables to be included in the estimations. Diff erent versions of the vector autoregressions (VARs), which vary by the particular exchange rate measure utilized, were estimated to quantify the impacts of the major infl uences on OF remittances. An OF deployment-based eff ective exchange rate index was constructed in the study which proved to be a signifi cant predictor of the movement of OF remittances. Moreover, an incidental but signifi cant fi nding of the study is the procyclical nature of OF remittances.

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37



Adjustments in the face of peso volatility: Perspectives from the past and policy directions

AGNES YAPBangko Sentral ng Pilipinas

CRISTETA BAGSICBangko Sentral ng Pilipinas

Th is paper examines the volatility of economy-wide and industry-specifi c peso exchange rates since 1998, and assesses the impact of such volatility on the profi tability of a sample of listed Philippine banks and corporate fi rms. Our regression results provide evidence that volatility in foreign exchange rates aff ect the profi tability of fi rms. Furthermore, there are gains in explanatory power when industry exchange rates are used instead of aggregate exchange rates as an explanatory variable for stock price return. Our results also show that the operations and risk management systems in place in diff erent fi rms are suffi ciently heterogeneous to the extent that the impact of foreign exchange volatilities in their profi tability diff ers across sectors and even among fi rms within a sector. Th ese results suggest that there is no one-size-fi ts-all foreign exchange policy, and a fi rm or a sector might be negatively aff ected by foreign exchange developments even as other sectors of the economy benefi t. Th is implies that initiatives from policymakers that encourage the development of risk management mechanisms become necessary conjugates to policies aimed at making the foreign exchange market more effi cient.

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38


PARALLEL PANEL HHealth

Information, incentives and practice patterns: The case of TB DOTS services and private physicians

in the PhilippinesALELI KRAFT


JOSEPH CAPUNOSchool of Economics, University of the Philippines

STELLA QUIMBOSchool of Economics, University of the Philippines

CARLOS ANTONIO TAN, JR.School of Economics, University of the Philippines

To explain divergent physician practices, studies focus on either diff erences in education and training or fi nancial incentives. Th e policy challenge is to identify the most cost-eff ective interventions to encourage adherence to practice guidelines. Utilizing private physician data in major cities in the Philippines, we show the eff ects of training and fi nancial incentives in physician adoption of the TB DOTS protocol. Training seems to be more important when the new protocol is a signifi cant departure from the old know-how, while fi nancial incentives seem to work better on those who are already clinically competent. Th ese imply that uniform application of information-based and incentive-based interventions may not be cost-eff ective.

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39


Underuse of social insurance among the poor: Prevalence and consequences

PresentorJHIEDON FLORENTINO


Co-AuthorsSTELLA QUIMBO


ORVILLE SOLON School of Economics, University of the Philippines

C. PANELOSchool of Economics, University of the Philippines

RITI SHIMKADAUniversity of California at San Francisco

JOHN PEABODYUniversity of California at San Francisco

As developing countries move towards national health insurance programs, one of the more under appreciated problems is that benefi ciaries do not fi le claims and avail themselves of insurance benefi ts. An earlier household survey conducted in the Philippines by the Department of Health showed that less than half of those with insurance coverage actually fi led claims when sick and hospitalized.

In the Philippines, it is particularly important to understand insurance underutilization because the burden of health care spending falls largest on households (49 percent) and more importantly, health outcomes tend to be worse when households lack the resources to complete the treatment protocol.

We examine the phenomenon of insurance underutilization among poor households in 11 provinces in the central Philippines. We report on two hospital-based interventions implemented within a randomized policy experiment and evaluate their impact on insurance utilization. Th ese interventions are implemented by the National Health Insurance Program and therefore serve to promote insurance awareness, among other things. We use data collected from patient exit interviews conducted before and after these interventions were implemented and analyze these using logistic regressions.

Our initial fi ndings show that likelihood of fi ling insurance claims increases in the intervention sites. Moreover, insurance support values increase and recovery rates are higher in intervention sites. On this basis, we conclude that interventions that promote awareness of insurance packages among providers and patients improve fi nancial protection and health outcomes.

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40


PARALLEL PANEL IFinancial markets development

A stakeholder analysis on the initiative to harmonize/integrate regulatory functions of the Bangko Sentral ng Pilipinas, Securities & Exchange Commission, and the

Insurance CommissionPresentor

KAREN TECSONEPRA - ADMU

Main AuthorMARIO LAMBERTE

Th is study assesses the feasibility of establishing a single supervisory body for the Philippine fi nancial system. Discussions with four groups of stakeholders, namely consumers of fi nancial services, fi nancial services providers, fi nancial regulatory agencies and key policy-making government agencies, reveal varied degrees of receptiveness but no outright opposition to the proposal. Th e study discusses stakeholders’ arguments for and apprehensions about regulatory integration. Researchers propose as a path toward integration coordinating amendments to charters of fi nancial regulatory agencies; and formalizing the Financial Sector Forum and including in it the Cooperative Development Authority. Finally, researchers point out the need to establish an organization aimed at safeguarding the interests of consumers of fi nancial services, and helping form fi nancial sector reform agenda.

Karen G. Tecson is a Doctor of Philosophy candidate in economics at the University of the Philippines and has a master’s degree from New York University. She earned her bachelor’s degree from Ateneo de Manila University where she has also lectured.

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41


PARALLEL PANEL JEnergy

ANNA WHITEHOUSETotal Philippines Corp

Anna Whitehouse was appointed to the Philippines in July 2004 with TOTAL, where she initially held the position of Vice President, Retail Operations before being nominated as President & Managing Director in December 2005. Including this period, she has spent 22 years in the oil industry having held various senior key positions in Lubricants and other Specialty Divisions in Total-UK and Total-South East Asia in Singapore, and previously with Exxon-UK.

She graduated with Honours, B.S. Chemical Engineering from the University College of Dublin, Ireland.

She is married with three children.

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42


Bioenergy from a system level perspectiveRAYMOND TAN

De La Salle University

Global interest has in biofuels and bioenergy has been stimulated by the escalation of petroleum prices as well as the increased public awareness about climate change. In the Philippines, part of the response has been to legislate the use of liquid biofuels meant to displace petroleum-derived products such as gasoline and diesel fuel. Under this legislation, ethanol derived from starch- or sugar-bearing crops is to be blended with gasoline, while fatty acid methyl esters, otherwise known as biodiesel, is to be mixed with conventional diesel fuel. Th is response is an appropriate step in the right direction, as it introduces much-needed diversity into a sector which has traditionally been overly dependent on imported oil. Nevertheless, it is important to realize that transitions in energy use patterns will not be completely painless. Th is talk provides an overview of many technical issues, particularly those related to feedstock supply limitations brought about by thermodynamic considerations of the fuel life cycles.

Raymond R. Tan is an associate professor of the Chemical Engineering Department and research scientist at the Center for Engineering and Sustainable Development Research of De La Salle University-Manila. He has been doing research on the analysis and modeling of energy systems since the late 1990s, and his work has appeared in such publications as Energy, International Journal of Energy Research, Biomass & Bioenergy and Clean Technologies & Environmental Policy, among others. He has also consulted for industry, government agencies and non-government organizations on issues requiring his expertise in life cycle analysis.

Dr. Tan has an M.S. in Chemical Engineering and a Ph.D. in Mechanical Engineering, both from De La Salle University-Manila. He is also the recipient of multiple awards from the National Academy of Science and Technology, and has worked on low-carbon energy systems as a visiting researcher at the University of Portsmouth in the UK, and the International Flame Research Foundation in The Netherlands.

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43


PARALLEL PANEL KUrban and land issues

Land administration and management issues: Implications on CARP MARIFE BALLESTEROS

Philippine Institute for Development Studies

Th e CARP accomplishments on land distribution have been signifi cant. It has distributed more than two-thirds of total farm area and provided land ownership rights to more than 2 million farm workers. However, there have been no appreciable eff ects on poverty, productivity, investments in the agriculture sector. Why? Government has not provided the needed institutional framework for it to succeed. A critical institution in any land reform program is land administration and management (LAM). Weak LAM has resulted in the following: (1) land redistribution has been poorly targeted; (2) evasion tactics have been pervasive; (3) many of the distributed ownership rights remained unperfected; (4) land valuation or just compensation provision of the law has been exploited; (5) weakened property rights on agriculture land.

Marife Ballesteros is a senior research fellow at the Philippine Institute for Development Studies. She has extensive research experience in housing, land markets and urban development, and has served as technical adviser/resource person to Philippine legislative sessions and local governments. She has also consulted with foreign agencies as a housing finance and land economist.

Dr. Ballesteros has a Ph.D. (development economics) from the Nijmegen University in the Netherlands. She earned her M.A. (economics) from the University of the Philippines and her B.S. (agricultural economics) from the University of the Philippines-Los Banos.

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44


A primer on land administration in the Philippines and the Mango Avenue project

PATRICK GERARD SIMON-KINGAteneo de Manila University

Th e report discusses the importance of proper land administration to economic development in the Philippines. It outlines the prevailing land administration and land titling processes and shows how these can lead to a number of issues such as coordination failures, unreliability of land records, and high transactions costs involved in obtaining and transferring land titles.

Th e report also highlights the eff orts of the Ateneo Center for Economic Research and Development (ACERD) in addressing some of these issues. In particular, the report will focus on the Mango Avenue Project, a project that aims to create a prototype for a digital database registry for land titles. A discussion on project details and the implementation plan will be given. Th is project is an undertaking involving the ACERD, the Cebu City local government and the Cebu City Registry of Deeds.

Patrick Gerard Simon-King is a lecturer at the economics department of the Ateneo de Manila University, and is also the project manager of the ACERD Land Management and Property Rights Project.

Mr. Simon-King completed his M.A. and B.A. in economics at the Ateneo de Manila University.

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45


PARALLEL PANEL LRegulation and development

Regulation and competition policy: Empowering the market and growth in LDCs

RAUL V. FABELLA School of Economics, University of the Philippines

We address the crucial question of when and how the LDC state should intervene in the market in order to foster faster growth. Axiomatic to the enquiry is the belief now strongly evidenced that “enabling the market” is the touchstone to faster economic growth so that microeconomic interventions must serve this end. We review two important pathologies shaping state intervention, viz., government failure and its accompanying philosophy laissez faire on the one hand and market failure on the other; their sources and histories. In LDCs where weak governance is endemic, the current truism “Market failure is a necessary but not a suffi cient condition for state intervention” must be paid utmost attention as state failure is the rule rather than the exception. We review the robust evidence on the positive infl uence of regulatory quality on growth performance and the features that make for good regulatory environment, dwelling on the problem of acquiring these features. Th e most important schools of thought in competition policy, viz., the CSP, the Chicago Tradition and the Evolutionary-Schumpeterian School are discussed and contrasted. Th e fi rst one favors per se rules while the other two favor rules of reason implications of which are drawn out. In weak governance environments, the need by fi rms (Taipans and robber barons) for second party enforcement may mean that the viable size of fi rms may be larger relative to the economy. Overall, competition where possible is better that regulation in LDCs.

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46


Understanding the logic of predatory pricingMA. JOY V. ABRENICA


Claims of predatory pricing behavior present a dilemma to regulators. Should it regulate against low price to prevent a predator from harming its target prey so as to preserve the competitive environment, or allow consumers to reap the benefi ts of low price but imperil market competition? Th ere have been skepticisms, expressed in economic literature and persuaded legal thinking, on the presence of predatory pricing in real market situations, i.e., whether a fi rm would intentionally pursue loss making strategy to induce its competitor out of the market and whether market processes would allow such a strategy to succeed. Th e paper reviews new economic theories, based on strategic behavior and imperfect information, which argue that incentives for predation abound. Yet even if predation is rational, it may not be easily distinguishable from aggressive competitive behavior, thus it remains a regulator’s conundrum.

Ma. Joy V. Abrenica is an associate professor at the School of Economics at the University of the Philippines, where she is also director for graduate admissions and fellowships. From 1996-2006, she was executive director of the Society for the Advancement of Technology Management in the Philippines.

Dr. Abrenica has a PhD in economics from the U.P. School of Economics, where she also obtained her master’s degree. Her completed her undergraduate studies at De La Salle University, graduating magna cum laude with a double-degree in accounting and economics.

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47


Determinants of compliance to water pollution standards in Central Visayas

LOURDES O. MONTENEGROUniversity of San Carlos

Growing concern in the Philippines over declining environmental quality has led to the legislation of more comprehensive and more market-based pollution control regulations. However, the effi cacy of these regulations rest not only with their design and but also with their implementation. In this paper, we examine these implementation issues and report initial results from an analysis of the impact of regulatory actions on environmental compliance choices of water pollution sources in Central Visayas, Philippines. In particular, we investigate the eff ect of inspections and enforcement on self-reported biological oxygen demand (BOD) concentrations using a facility-level panel dataset of all major point sources of water pollution in Central Visayas, Philippines for the years 1993-2006. We fi nd that the increased probability of inspection and legal enforcement did not signifi cantly reduce BOD concentrations; in contrast, higher compliance cost had a signifi cant and positive infl uence on BOD concentrations. Th is may suggest that programs that aim to lower compliance costs may be more eff ective in bringing about lower pollution discharges compared to traditional inspection and legal enforcement actions.

Lourdes O. Montenegro has a Master of Philosophy in environmental policy from the University of Cambridge, and an M.A. in economics from the University of San Carlos. She graduated magna cum laude from the University of San Carlos with a BA in economics.

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48


PARALLEL PANEL MMonetary reforms 2

Are Asian housing prices too high for comfort?ELOISA GLINDROBangko Sentral ng Pilipinas

Co-AuthorsTIENTIP SUBJANIJ

Bank of Thailand

HAIBIN ZHUBank for International Settlements

JESSICA SWETOHongkong Monetary Authority

Th is paper examines the determinants of housing prices, discusses the role of distinctive institutional arrangements and explores the possible emergence of housing bubbles in 10 Asia-Pacifi c economies. More importantly, the paper looks into the characteristics of house price cycles since the mid-1990s, when many when many market-oriented reforms in the real estate sector were introduced in this region. It provides evidence of serial correlation and mean reversion embedded in the short-term dynamics of house prices in each country. Th e paper also extends existing literature by distinguishing between house price overvaluation and house bubbles. House price overvaluation is characterized by two components, namely the (i) intrinsic house price cycles and (ii) residual component or true “bubble.” Overvaluation characterized by intrinsic house price cycles means that house prices can rise above their fundamental value due to inherent stickiness in the housing market. Th e residual component that can not be explained by serial correlation and mean reversion of house price dynamics is most likely driven by overly optimistic expectation of future house price movements.

Not surprisingly, the patterns of national housing price dynamics exhibit signifi cant cross-country heterogeneity, which can be attributable to the diff erent stage of economic development, diff erent institutional arrangements and market-specifi c conditions. Th e results of long-term fundamentals and short-term dynamics of housing prices indicate that the current run-up in house prices mainly refl ects adjustment to more robust fundamentals rather than an indicator of speculative housing bubbles. None of the countries/cities/market segments studied falls in the explosive region. At the national level, most of the countries exhibit convergence although at slower pace.

Since the results are largely a function of the estimation period, the fi nding of relatively benign housing market should be taken with great care as there would always be new sources of volatility as markets develop. To mitigate house price overvaluation driven by intrinsic price cycles, the policymaker should probably adopt measures aimed at reducing the magnitude and frequency of intrinsic property cycles, such as improving land use regulation and enhancing property right protection. Information is critical as markets develop, hence, improvement in the data capture, credit rating and risk assessment is likewise imperative. To address


49


the bubble issue, the policymaker may adopt measures that control unwarranted high expectation of capital gains in the housing market.

Eloisa T. Glindro has an M.A. (economics) from the U.P. School of Economics and a B.S. (economics) from the University of the Philippines-Los Banos. She is currently with the Bangko Sentral ng Pilipinas’ Center for Monetary and Financial Policy. She recently completed a stint as research fellow at the Asian Research Programme of the Bank for International Settlements Office for Asia and the Pacific, where she participated in a research project on Asian house price dynamics. She also worked at the National Economic Development Authority’s (NEDA) National Planning and Policy Staff.

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50


Forecasting the volatility of Philippine inflation using GARCH models

HAYDEE RAMONBangko Sentral ng Pilipinas

Th e study highlights the statistical procedure employed in developing a short-term forecasting model that explores the volatility feature of Philippine infl ation from years 1995 up to 2007. To build such a model, we specify fi rst the Autoregressive Moving Average (ARMA) model then include the Seasonal ARMA (SARMA) model if seasonality is present, to represent the mean component using the past values of infl ation. Next, we incorporate the Generalized Autoregressive Conditional Heteroskedasticity (GARCH) model to represent its volatility. Diagnostic tests indicate that the specifi cations D(IR) (the fi rst diff erence of month-on-month infl ation) as the stationary series, AR(1) and SMA(12) for the mean, GARCH(0,1) or ARCH (1) for the variance with Student’s t distribution having fi xed degrees of freedom v = 10 for the errors, performs best in forecasting the volatility of the infl ation rate for the Philippines.

Haydee Lopez Ramon received her B.S. degree in Mathematics, major in Actuarial Science and Statistics, from De La Salle University in October 2001. Her undergraduate thesis entitled, “Obtaining Unit-Distance Graphs by Subdivision of Edges” was awarded a gold medal for outstanding thesis recognition, with Severino V. Gervacio, Ph.D. as thesis adviser and Michele G. Tan as thesis partner. Following a B.S. in DLSU, she earned an M.S. degree in Applied Mathematics major in Actuarial Science from the University of the Philippines in April 2006.

Currently, Ms. Ramon is designated as acting bank officer III of the Economic and Financial Forecasting Group (EFFG) of the Department of Economic Research. EFFG is tasked with the generation of forecasts and simulation exercises for various economic and financial variables in support of monetary policy formulation. Ms. Ramon is currently handling the maintenance of inflation forecasting models such as the BSP multi-equation model and GARCH model for forecasting inflation volatility.

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51


Policy considerations in the light of oil price volatilityJADE ERIC REDOBLADO


Th e paper attempts to characterize the policy environment in the context of oil price volatility. An SVAR model is estimated to determine the impact of oil price volatility on output and infl ation as well as to evaluate the eff ect of monetary policy intervention. It is shown that the magnitude of an oil shock matters less than oil price volatility in determining the behavior of output and infl ation. Modeling is also benefi ted by incorporating policy shifts. Similar results are also observed when estimating asymmetric eff ects on output and infl ation from an oil shock. Impulse response functions indicate greater persistence for a policy shock as compared to an oil shock.

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52



PARALLEL PANEL NStudent papers

Catastrophic health care, poverty and impoverishment in the Philippines

RONALDO ICOSchool of Economics, University of the Philippines

Th e paper attempts to describe catastrophic health spending and its impact to poverty in the Philippine setting. It focuses on the role of out-of-pocket payments for health care as a springboard in the analysis of measuring the magnitude and analyzing the extent of damage of catastrophic health expenditures. It also explores the scope and trends of these spending by diff erent socioeconomic indicators such as household headship, agricultural indicator and regional group. More importantly, it delves into trends over time and among diff erent income groups. It also employs several quantifi able measures and tools in determining the extent of “catastrophic” incidence and intensity to determine the eff ects on poverty. Lastly it looks into the state of impoverishment after incurring these payments. Th e results indicate that in general households belonging to higher income groups are more vulnerable to catastrophic health spending and households belonging to lower income groups are more prone to impoverishment.

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53


54

Selected demographic variables affecting the educational attainment of children in the Philippines

MIGUEL ROBERTO BORROMEOJESUS CARLOS EXEQUIEL CASTILLO

ELEAZAR LOPEZ, JR.De La Salle University

Th is paper examines the determinants of educational attainment of children in the Philippines. Th e study uses merged data sets from the nationally-representatives 2003 Labor Force and Family Income and Expenditure Survey. Th e highest grade attained of children aged 13-22, 17-22, and 21-22 for primary schooling, secondary schooling, and tertiary schooling, respectively are examined using ordered probit models that are buttnessed by a diverse conceptual framework. Schooling attainment of males and females are also examined separately so as to shed light on the potential disparity between the education levels between sexes. Education results show that parental attainment of children, and mother’s education has stronger eff ect compared with father’s education while an increase in permanent income of household is not alwaays associated with increased attainment, household still face severe resource constraint.

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55

PLENARY SESSION 2Pushing Philippine manufacturing towards sustained growth

Sustaining the Philippine manufacturing sectorPONCIANO INTAL, JR.

MIGUEL ROBERTO BORROMEO JESUS CARLOS EXEQUIEL CASTILLO

De La Salle University

Th e Philippine manufacturing sector is an anomaly in East Asia’s economic development experience. It is only in the Philippines among the major economies of East Asia where the manufacturing sector contributed the least in terms of national employment and in the share of gross domestic product for nearly three decades. Th e sector failed to provide the dynamic growth push that the successful high fl ying East Asian economies experienced. Th e sector underwent a wrenching adjustment in the 1990s and early 2000s in the face of a far more open economy and far greater competition in the world market. Nonetheless, the future of the sector is not bleak. Th e sector is likely to experience robust growth as it benefi ts from growth impulses from the other sectors of the economy and as its industrial restructuring process deepens and widens further to industries and niches where the country has comparative advantage. In the process, the sector contributes to a broad – based growth process in the country, the fi rst ever in the post WWII economy history of the country. In this scenario, the country’s manufacturing sector will be essaying a model of manufacturing sector-overall economy interaction diff erent from the historical experience of most East Asian economies. However, this scenario demands further improvement in the country’s investment climate, which would require not only further economic and institutional reforms but also even political reforms in the country.

• • • • •



NORBERTO VIERATexas Instruments

Norberto Viera is President and Managing Director of Texas Instruments’ Philippines operations, and manages a group of 2500 employees at TI’s Assembly and Test facility in Baguio City.

Having earned a Bachelor of Science in Electronics and Communications, Mr. Viera began his career at TI as a product engineer in 1979. He soon took on supervisory and management responsibilities and was named President and Managing Director of TI’s Philippine operations in 1996.

An active member of the community and past president of the Semiconductor and Electronics Industries of the Philippines (SEIPI), he is the recipient of numerous awards and citations including;

• Centennial Award, Total Thomasian Award for Science and Technology, and Hall of Fame Award (Field of Engineering) from the University of Santo Tomas

• Medal of Honor Award from the Angeles University Foundation• Partner of the Industry Award from SEIPI• Doctor of Humanities from the University of BaguioA native of Ajuy, Iloilo, Mr. Viera and his wife have 4 children and

reside in Baguio City. Texas Instruments, based in Dallas, Texas, is the world's largest supplier

of Mixed Signal and Analog Integrated Circuit Products.

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56



Financing SMEs in the manufacturing sectorMA. FLORDELIS AGUENZA

Planters Development Bank

Th e presentation will essentially discuss Plantersbank experience in fi nancing SMEs in the manufacturing sector, covering the following areas of interest:

• Th e bank’s historical exposure to the manufacturing sector

• Th e profi le of manufacturing SMEs that it has fi nanced

• Lessons learned from fi nancing SMEs in the manufacturing sector

• Issues and concerns aff ecting manufacturing SMEs

• Policy recommendations to improve performance of manufacturing SMEs and the manufacturing sector in general

As the Bank for SMEs, Plantersbank’s experience can hopefully bring out relevant policy and business issues in promoting manufacturing SMEs for consideration by both the public and private sectors.

Maria Flordelis F. Aguenza is the President and Chief Operating Officer of Planters Development Bank, the country’s largest private development bank. The recognized leader in SME finance, Plantersbank counts among its shareholders:

• International Finance Corporation – World Bank• Asian Development Bank• Netherlands Development Finance Company (FMO)• DEG, the German government-owned Development BankPlanters Development Bank is currently the 19th largest bank in the

Philippines.Ms. Aguenza earned her Bachelor of Science degree in Business

Administration, major in Economics from the University of the Philippines (UP) in 1963, and took post graduate studies in Economics from the Ateneo de Manila University.

• • • • •

57



PLENARY SESSION 3Poverty, population, and the labor market

Population as public interestERNESTO PERNIA


Th e population issue – now passé elsewhere in the developing world, even in the poorer countries – remains a durable puzzle in the Philippines. On the one hand, a majority of Filipinos regard rapid population growth as an impediment to socioeconomic development, requiring policy intervention; on the other hand, virtually nothing is being done about it as the government appears immobilized owing to opposition from the conservative Catholic Church hierarchy. Central to the population issue are the negative externalities that sustained high fertility brings to bear on economic growth, the environment, inequality and poverty. Th ese externalities plus the fact that women, particularly in poor households, are having more children than their desired number, as repeatedly shown by surveys, constitute strong grounds for an unambiguous population policy. Population is evidently a public interest issue that the national government must address squarely, objection from some religious groups notwithstanding.

Ernesto M. Pernia is a professor of economics at the University of the Philippines, and director for public affairs at the U.P. School of Economics. He is a member of the Philippine-American Academy of Science and Engineering. He sits on the board of trustees of the University of San Carlos and on the boards of a few NGOs involved in development work.

Until recently, Dr. Pernia was lead economist at the Asian Development Bank’s Economics and Research Department (ERD) where he developed and directed projects on investment climate and productivity, regional economic cooperation, human resource development, and economic growth and poverty reduction in various Asian countries. He also headed ERD’s Knowledge Dissemination Unit and was the managing editor of the Asian Development Review.

He obtained his Ph.D. degree from the University of California at Berkeley in 1976. He received the first award as Outstanding Young Scientist (economics and social sciences) from the National Academy of Science and Technology in 1980. He is a former president of the Philippine Economic Society and co-chair of the Federation of ASEAN Economic Associations. He has written a number of books, numerous articles in international professional journals, and chapters in books. He has been a speaker at numerous international and national conferences on various economic and development issues.

• • • • •

58



Analysis on poverty, equity and labor market in the Philippines

HYUN SONAsian Development Bank

Th is paper analyzes the relationship between growth, inequality and poverty in the Philippines, focusing on the role played by the labor market. It proposes a decomposition methodology that explores linkages between growth and labor market performances in terms of labor force participation, employment, working hours and productivity. Th is paper introduces a methodology that provides a direct linkage between poverty and labor market indicators. Th e paper provides empirical analysis using both the Family Income and Expenditure Survey (FIES) and Labor Force Survey (LFS), covering the period 1997 to 2003.

Hyun H. Son is Economist at the Asian Development Bank. Before joining ADB, she was Poverty Economist/Specialist at the International Poverty Centre, United Nations Development Programme. She also worked at the World Bank in Washington DC and held an academic position at Macquarie University, Sydney Australia. She has published and researched in the areas of economic development, poverty, inequality, public policies, and pro-poor growth and policies.

• • • • •

59



Occupational dynamics and workers’ welfare: The Philippines before and after the Asian financial crisis

RANA HASANAsian Development Bank

KARL JANDOCAsian Development Bank

Family income and expenditure survey (FIES) data from the Philippines show that while households have experienced respectable growth in incomes and expenditures during the mid 1990s, these grew very sluggishly (if at all) since the Asian fi nancial crisis. Based on the idea that these trends have been driven by outcomes in labor markets, this paper uses four rounds of merged FIES and labor force survey data spanning the period 1994-2003 to investigate occupational dynamics in the Philippines. In particular, we examine how wages and job characteristics have evolved pre- and post-crisis. Additionally, we employ semi-parametric procedures and Propensity Score Matching (PSM) methods to develop indicators of job quality and assess their evolution from 1994 up to 2003. We also relate wages and our indicators of job quality to industry and sector specifi c factors, and explore what elements of economic policy may be driving the trends that we document.

Rana Hasan’s research interests lie in exploring the impact of economic reforms on labor market outcomes and productivity. He has examined the linkages between trade liberalization and various dimensions of labor market outcomes including poverty, wage inequality, and the demand for industrial labor. His research has also examined the effects of trade and industrial policy on economies of scale and an assessment of the impact of domestic and imported sources of technological change on productivity.

Rana Hasan is currently Senior Economist in the Economics and Research Department of the Asian Development Bank. He has also worked as a Fellow in the Research Program of the East-West Center in Honolulu, USA. He received a Ph.D. in Economics from the University of Maryland in 1997.

Karl Jandoc is a Ph.D. candidate of the University of the Philippines School of Economics and currently Consultant at the Asian Development Bank. His current research interests focus on Philippine development issues impinging on labor market outcomes and household welfare.

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60



61


PLENARY SESSION 4Labor migration and development

Migration and development: Still an unsettled relationshipMANOLO ABELLA

International Labor Organization

Th e growing volume of migrants’ remittances and their relative stability compared to capital fl ows have lately generated a lot of optimism that migration can serve as the engine of growth for some developing countries. Th e World Bank and the WTO have contributed to this optimism with their estimates of the potential gains in global welfare if there is some liberalization of international migration regimes.Even the earlier concerns about “brain drain” are being dispelled by evidence, albeit fragmentary, that human capital stock of origin countries are not diminished, but instead enhanced, by migration because of the latter’s incentive-eff ect on investments in education. Nevertheless the nexus between migration and development continues to be questioned because tradiitional development theories do not support optimism and because one is hard put to fi nd examples of economies thathave been successfully transformed by migration.

Manolo Abella is currently managing an ILO/EU project on the Governance of Labour Migration in Asia based in Bangkok. He is a member of the Advisory Board of the Centre on Migration, Policy and Society at the University of Oxford and of the Institute of Public Policy Research in London. From 1998 to the end of 2004, he served as the Director of the International Migration Programme of the ILO, where he steered the organization’s work in assisting member states to improve their policies on labour migration and directed its related program of research. In 2004, he organized the activities that led to the adoption of a resolution on an ILO Plan of Action “A Fair Deal for Migrant Workers in a Global Economy” by the International Labour Conference and later to the development of a Multilateral Framework for Managing Labour migration, the cornerstone of the ILO Plan of Action.

Mr. Abella has frequently been called upon to advise governments on labour migration policy, address international conferences, and lecture in universities. He has contributed extensively to the literature on labor migration, particularly on the growth of contract labour migration in Asia and the Middle East, and on the structural changes influencing labour migration. The book Managing Labor Migration in the 21st Century, which he co-authored with Philip Martin and C. Kuptsch, was published by Yale University Press in October 2005. In 2002, President Gloria Arroyo of the Philippines awarded him the “Heritage Award” for outstanding work as an international civil servant.

Before joining the ILO he served as the Executive Director of the Institute for Labor and Manpower Studies in the Philippines, and before that as economist at the Philippine Board of Investments. He has a BA degree from Ateneo de Manila University, an M.A. in Economics from McGill University and an M.A. in Public Administration from Harvard University.

• • • • •


62


Labor migration and development: Lessons from the Mexican experience

RAUL DELGADO WISEUniversity of Zacatecas, Mexico

From the perspective of the political economy of development, this paper analyzes the role played by Mexican labor in the U.S. productive restructuring process under the aegis of the North American Free Trade Agreement. By conceptualizing the labor export-led model it dissects three basic mechanisms of regional economic integration: maquiladoras, disguised maquilas, and labor migration. Not only does this analytical framework cast light on the contributions made by Mexican migrants to the economies of the United States and Mexico, it also reveals two paradoxes: the broadening of the socioeconomic asymmetries between the two countries, and increased socioeconomic dependence on remittances in Mexico.

Raúl Delgado Wise is Director of the Doctoral Program in Development Studies at the University of Zacatecas (Mexico) and Executive Director of the International Migration and Development Network. He is author/editor of 14 books and more than 100 essays, including book chapters and refereed articles. Dr. Delgado has been guest lecturer in Canada, the United States, Denmark, Switzerland, Germany, the Netherlands, Great Britain, Italy, Spain; Ghana, and various Latin American countries. He received the annual prize for economics research “Maestro Jesús Silva Herzog” in 1993, and is a member of the Mexican Academy of Sciences, of the National System of Researchers,and of several scholarly associations in Canada, the United States, Latin America and Europe. He is editor of the Journal Migración y Desarrollo, member of the editorial committee of several academic journals in the US, Chile, Argentina and Mexico, and editor of the book series “Latin America and the New World Order” for Miguel Angel Porrúa.

• • • • •


63


The determinants of Filipino overseas workers’ remittances: Some preliminary findings

MICHAEL M. ALBADe La Salle University

Detailing what is still work in progress, this paper reports some preliminary fi ndings on the microeconomic determinants of Filipino overseas workers’ remittances to their households of origin. Based on merged public use data fi les of the Survey of Overseas Filipinos and the Family Income and Expenditures Survey, both of 2003, the estimation results indicate that the likelihood and amounts of remittances are infl uenced by diff erent sets of factors. To address what motivates remittances, the paper notes that a large proportion of Filipino overseas workers are actually the heads or spouses of heads of households, which diff ers from the usual assumption of remittance motivation models that migrant workers are the other household members rather than the heads or spouses themselves. Applied separately on the head-and-spouse sample and on the other-household-members sample, Heckman’s selection model yields results that suggest that the remittance behavior of heads and spouses may be consistent with the exchange motive, while that of other household members may better fi t the altruistic motive. An interesting result for the other-household-members sample is their negative selectivity, i.e., unobserved factors that increase their likelihood of remitting also decrease the amounts they remit.

Michael M. Alba is an associate professor of economics at De La Salle University, where he served as dean of the College of Business and Economics from 2001-2006.

Currently the president of the Philippine Economic Society, Dr. Alba is also a member of the editorial board of the Philippine Journal of Development. In 2003, his paper “Household vulnerability to employment shocks” was recognized with the outstanding scientific paper award by the National Academy of Science and Technology.

He has a B.A. (economics) from the Ateneo de Manila University, an M.A. (economics) from the University of the Philippines, and a Ph.D. (applied economics) from Stanford University. He also received training on qualitative choice analysis from the University of California in Berkeley.

• • • • •


64


Factoring in the social dimensions of international labor migration: The Philippine experience

FABIO BAGGIOScalabrini Migration Center

A fair assessment of more than 30 years of massive deployment of Filipino workers cannot disregard the “social costs” of migration. Th e contract worker system, which does not allow family reunifi cation, has unveiled the vulnerability of “transnational” families. A new “culture of migration” has arisen: new generations are growing up with the conviction that emigration is the only way to achieve professional and personal fulfi llment. Th e educational system has adjusted to professions that are marketable abroad, with little consideration of what is really needed in the Philippines. Th e exodus of professionals and “brain drain” may present a real impoverishment of the Philippines, especially in the health care sector. Th e feminization of migration underscores risks and vulnerabilities which pose major challenges to the protection of migrants’ rights. Th e strong dependency on money earned abroad aff ects not only migrants’ nuclear family, but also their extended family, whose members had economically contributed to their deployment. Th ese manifold concerns should be considered alongside the economic benefi ts of international labor migration.

Fabio Baggio is a missionary of the Scalabrinian Congregation (Missionaries of Saint Charles Borromeo) since 1991. After concluding his studies in the Pontifical Gregorian University in Rome (PhD in History), he was assigned to different missionary activities.

He was counselor of the INCAMI (Episcopal Commission for Migrations of Chile) in Santiago de Chile, from 1995 to 1997, and director of the Migration Department of the Archdiocese of Buenos Aires (Argentina) from 1997 to 2002. He worked as a researcher in the Center for Latin-American Migration Studies (CEMLA), in Buenos Aires, from 1998 to 2002. He taught as adjunct professor at the Faculty of Social Sciences in the Universidad del Salvador, in Buenos Aires, from 1999 to 2000, and in the Institute of Theology of Sao Paulo - ITESP (Brazil), from 2000 to 2001.

Presently, he is adjunct professor at the “Pontificia Universitas Urbaniana” in Roma, Italy; professor at the Maryhill School of Theology (SMT) in Manila, Philippines; director of the Scalabrini Migration Center (SMC) in Manila, Philippines; editor of the Asian Pacific Migration Journal (APMJ) and Asian Migration News (AMN); vice-president of the Philippines Migrant Rights Watch (PMRW) and area representative for Asia-Pacific of the Scalabrini Migration Network (SMN).

• • • • •


65


PLENARY SESSION 5Fearless forecast for 2008: Th e take-off ?

The Philippine economic and credit outlookJAMES MCCORMACK

Fitch Ratings

James McCormack will present his views on the Philippine Economic and Credit Outlook, focusing on Fitch Ratings global outlook and the implications for the Philippines. Fitch projects weaker US economic growth in 2008, and this will aff ect economic growth across Emerging Asia, including the Philippines. To some extent, the Philippines will benefi t from increasing trade ties with China, but there are limitations to this consideration. From a sovereign credit perspective, the Philippines iswell placed to deal with any reduction in capital fl ows to Asia which may accompany a reduction in global investor risk appetite. Th is topic will be explored in the context of the Philippines’ gross external fi nancing requirement for 2008. Mr. McCormack will also discuss recent fi scal performance in the Philippines, as this is a critical factor in the sovereign rating outlook.

James McCormack is a senior director in Fitch Ratings’ sovereigns group in Hong Kong, where he is responsible for analysis and ratings of sovereigns across Asia. Previously, Mr. McCormack worked for Fitch as a senior director of sovereigns in London, covering the Middle East as well as Central and Eastern Europe.

Prior to joining Fitch, Mr. McCormack worked for Export Development Corp. of Canada as a country risk analyst. Earlier, he was an economist for the Department of Foreign Affairs & International Trade in Canada, in the Economic and Trade Policy Division as well as the International Economic Relations Division. He was also an economist at Wharton Econometrics (WEFA) Canada.

Mr. McCormack earned a BA (Honours) in economics from York University (Canada) and an MA in international economics from the University of Toronto.

• • • • •


SIN BENG ONG

Sin Beng Ong re-joined JPMorgan Singapore in 2003 working in Emerging Asia research following a stint in Hong Kong with the Boston Consulting Group. He currently heads up JPMorgan’s research effort for the ASEAN region. He holds a bachelors and masters from Cornell University.

• • • • •

66



Growing at 7.5 percent: Too good to be true, too good to last?

CIELITO F. HABITOAteneo Center for Economic Research and Development

Ateneo de Manila University

Th e fi rst semester performance of the Philippine economy, as manifested in trends in prices, jobs and incomes, is the usual mix of good and bad news. Th e reported rate of growth of the economy has surprised even government economic managers. Infl ation and employment data likewise refl ect positive trends. But apparent contradictions in the economic data put to question the reliability of the reported trends. At the same time, closer examination of the data and international trends reveal weaknesses that may put to question the sustainability of such positive indicators. Continuing weakness in investment and revenue performance are the most critical threats that the Philippine economy must overcome. Th e medium and longer term potentials of the economy remain promising, but much needs to be done by way of reforms in governance and economic policies in order to realize such potentials.

Cielito F. Habito is currently a professor of economics at the Ateneo de Manila University, where he is the director of the Ateneo Center for Economic Research and Development (ACERD). He also sits in the boards of several corporations and foundations, including the Manila Water Corporation, Metrobank Card Corporation, Mutual Fund Company of the Philippines, Philsteel Holdings, the Cahbriba Alternative School Foundation, Maximo T. Kalaw Institute for Sustainable Development, Brain Trust, Inc., and the Ramos Peace and Development Foundation (RPDEV).

Dr. Habito writes the weekly column “No Free Lunch” in the Philippine Daily Inquirer. He was the youngest member of the Cabinet of Philippine President Fidel V. Ramos as Secretary of Socioeconomic Planning/NEDA Director-General throughout his six-year presidency from 1992 to 1998. He chaired the Philippine Council for Sustainable Development from 1992-1998, and was elected Chair of the Sixth Session of the United Nations Commission on Sustainable Development in New York in 1998.

Before joining government in 1990, he was Professor and Chairman of the Department of Economics at the University of the Philippines-Los Baños (UPLB), and had also worked at Kyoto University and the World Bank. He holds a Ph.D. (1984) and M.A. (1981) in Economics from Harvard University, a Master of Economics (1978) from the University of New England (Australia), and B.S. Agricultural Economics, summa cum laude (1975) from the University of the Philippines-Los Banos.

• • • • •

67



68

Notes


69

Notes


President MICHAEL M. ALBA De La Salle University

Vice-President FERNANDO T. ALDABA Ateneo de Manila University

Secretary WINFRED VILLAMIL De La Salle University

Treasurer LEONARDO LANZONA Ateneo de Manila University

Directors MYRNA AUSTRIA De La Salle University

ARTURO CORPUZ Ayala land, Inc.

PONCIANO INTAL, JR. De La Salle University

ANICETO ORBETA, JR. Philippine Institute for Development Studies

PETER LEE U University of Asia & the Pacifi c

Ex-Offi cio ARSENIO M. BALISACAN University of the Philippines

EMMANUEL ESGUERRA University of the Philippines

Officers & Board of Directors

70


1961 Armand V. Fabella1962/63 Amado A. Castro1963/64 Benito F. Legarda, Jr.1964/65 Agustin L. Kintanar1965/66 Placido L. Mapa, Jr.1966/67 Jose Encarnacion, Jr.1967/68 Gerardo P. Sicat1968/69 Edgardo P. Zialcita1969/70 Sixto K. Roxas1970/71 Antonio V. Ayala1971/72 Jose E. Romero, Jr.1972/73 Quirico S. Camus, Jr.1973/74 Bernardo M. Villegas1974/75 George Piron1975/76 Vicente B. Valdepeñas, Jr.1976/77 Vicente R. Jayme1977/78 Jesus P. Estanislao1979 Mahar K. Mangahas1980 Manuel S. Alba1981 Ramon K. Katigbak, Jr.1982 Cesar P. Macuja1983 Vicente T. Paterno1984 Filologo Pante, Jr.1985 Emmanuel T. Velasco1986 Edita A. Tan1987/88 Ernesto M. Pernia1989 Ramon B. Cardenas1990 Benjamin E. Diokno1991 Vaughn F. Montes1992 Alejandro N. Herrin1993 Mario B. Lamberte1994 Victor B. Valdepeñas1995 Margarito B. Teves1996 Felipe M. Medalla1997 Emilio T. Antonio, Jr.1998 Cayetano Paderanga, Jr.1999 Romeo L. Bernardo2000 Dante B. Canlas2001 Ruperto P. Alonzo2001 Cielito Habito2003 Emilia Boncodin2004 Gilberto M. Llanto2005 Alexander C. Escucha2006 Arsenio M. Balisacan

Past Presidents

71


PLDT-SMART FOUNDATION

FOUNDATION for the PHILIPPINE ENVIRONMENT


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