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Yothin Jinjarak

Works: 49 works in 181 publications in 1 language and 1,109 library holdings
Roles: Author
Classifications: H62.5.U5, 332.04240981
Publication Timeline
Publications about Yothin Jinjarak
Publications by Yothin Jinjarak
Most widely held works by Yothin Jinjarak
The collection efficiency of the value added tax : theory and international evidence by Joshua Aizenman( file )
11 editions published in 2005 in English and held by 91 libraries worldwide
This paper evaluates the political economy and structural factors explaining the collection efficiency of the Value Added Tax [VAT]. We consider the case where the collection efficiency is determined by the probability of audit and by the penalty on underpaying. Implementation lags imply that the present policy maker determines the efficiency of the tax system next period. Theory suggests that the collection efficiency is impacted by political economy considerations greater polarization and political instability would reduce the efficiency of the tax collection. In addition, collection is impacted by structural factors affecting the ease of tax evasion, like the urbanization level, the share of agriculture, and trade openness. Defining the collection efficiency of the VAT as the ratio of the VAT revenue to aggregate consumption divided by the standard VAT rate, we evaluate the evidence on VAT collection efficiency in a panel of 44 countries over 1970-99. The results are consistent with the theory - a one standard deviation increase in durability of political regime, and in the ease and fluidity of political participation, increase the VAT collection efficiency by 3.1% and 3.6%, respectively. A one standard deviation increase in urbanization, trade openness, and the share of agriculture changes the VAT collection efficiency by 12.7%, 3.9%, and - 4.8%, respectively. In addition, a one standard deviation increase in GDP/Capita increases the tax efficiency by 8.1%. Qualitatively identical results apply for an alternative measure of VAT collection efficiency, defined by the ratio of VAT revenue to GDP divided by the standard VAT
Globalization and developing countries - a shrinking tax base? by Joshua Aizenman( file )
9 editions published between 2006 and 2007 in English and held by 83 libraries worldwide
This paper evaluates the impact of globalization on the tax bases of countries at varying stages of development. We see globalization as a process that induces countries to embrace greater trade and financial integration, and macro stabilization. This in turn should shift their tax base from "easy to collect" taxes [tariff, seigniorage, etc.] towards "hard to collect" taxes [VAT, income tax, etc.]. We confirm this prediction -- the revenue/GDP ratio of the "easy to collect" taxes declined by about 20% in developing countries between the early 1980s and the late 1990s, while the revenue/GDP of the "hard to collect" taxes increased by 9%. The relatively small initial base of "hard to collect" taxes in developing countries implied a net 7% drop in total tax revenue/GDP. Applying panel regressions and controlling for structural factors, we find that trade openness and financial integration have a positive relationship with "hard to collect" taxes, and negative relationship with the "easy to collect" taxes. The effects of globalization in our panel regressions are even larger than the effects of the institutional and political variables combined. Fiscal revenue from financial repression has also decreased, further reinforcing these results. The high income and the middle income countries managed to more than compensate for the revenue decline of the "easy to collect" taxes, increasing the total tax/GDP. In contrast, the upper and low income developing countries experienced sizeable drop in the tax/GDP. We also identify fiscal convergence: the coefficient of variation of tax revenue/GDP measures across countries declined substantially during 1980s - 1990s. The cross country variation declined by about 50% for seigniorage, about 30% for tariff, and about 15% for the "hard to collect" taxes. These results are consistent with the notion that improving the performance of the "hard to collect" taxes is more challenging than reducing the use of "easy to collect" sou
International reserves and swap lines : substitutes or complements? by Joshua Aizenman( file )
10 editions published between 2010 and 2011 in English and held by 63 libraries worldwide
Developing Asia experienced a sharp surge in foreign currency reserves prior to the 2008-9 crisis. The global crisis has been associated with an unprecedented rise of swap agreements between central banks of larger economies and their counterparts in smaller economies. We explore whether such swap lines can reduce the need for reserve accumulation. The evidence suggests that there is only a limited scope for swaps to substitute for reserves. The selectivity of the swap lines indicates that only countries with significant trade and financial linkages can expect access to such ad hoc arrangements, on a case by case basis. Moral hazard concerns suggest that the applicability of these arrangements will remain limited. However, deepening swap agreements and regional reserve pooling arrangements may weaken the precautionary motive for reserve accumulation
Current account patterns and national real estate markets by Joshua Aizenman( file )
11 editions published in 2008 in English and held by 61 libraries worldwide
This paper studies the association between the current account and real estate valuation across countries, subject to data availability [43 countries, of which 25 are OECD], during 1990-2005. We find robust and strong positive association between current account deficits and the appreciation of the real estate prices/(GDP deflator). Controlling for lagged GDP/capita growth, inflation, financial depth, institution, urban population growth and the real interest rate; a one standard deviation increase of the lagged current account deficits is associated with a real appreciation of the real estate prices by 10%. This real appreciation is magnified by financial depth, and mitigated by the quality of institutions. Intriguingly, the economic importance of current account variations in accounting for the real estate valuation exceeds that of the other variables, including the real interest rate and inflation. Among the OECD countries, we find evidence of a decline overtime in the cross country variation of the real estate/(GDP deflator), consistent with the growing globalization of national real estate markets. Weaker patterns apply to the non-OECD countries in the aftermath of the East Asian crisis
Capital flows and economic growth in the era of financial integration and crisis, 1990-2010 by Joshua Aizenman( file )
9 editions published in 2011 in English and held by 60 libraries worldwide
We investigate the relationship between economic growth and lagged international capital flows, disaggregated into FDI, portfolio investment, equity investment, and short-term debt. We follow about 100 countries during 1990-2010 when emerging markets became more integrated into the international financial system. We look at the relationship both before and after the global crisis. Our study reveals a complex and mixed picture. The relationship between growth and lagged capital flows depends on the type of flows, economic structure, and global growth patterns. We find a large and robust relationship between FDI - both inflows and outflows - and growth. The relationship between growth and equity flows is smaller and less stable. Finally, the relationship between growth and short-term debt is nil before the crisis, and negative during the crisis
De facto fiscal space and fiscal stimulus : definition and assessment by Joshua Aizenman( file )
8 editions published in 2010 in English and held by 58 libraries worldwide
We define the notion of 'de facto fiscal space' of a country as the inverse of the outstanding public debt relative to the de facto tax base, where the latter measures the realized tax collection, averaged across several years to smooth for business cycle fluctuations. We apply this concept to account for the cross-country variation in the fiscal stimulus associated with the global crisis of 2009-2010. We find that greater de facto fiscal space prior to the global crisis, higher GDP/capita, and higher financial exposure to the US, were associated with a higher fiscal stimulus/GDP during 2009-2010. Intriguingly, higher trade openness has been associated with lower fiscal stimulus
The US as the "demander of last resort" and its implications on China's current account by Joshua Aizenman( file )
11 editions published in 2008 in English and held by 56 libraries worldwide
This paper evaluates the degree to which current account patterns are explained by the variables suggested by the literature, and reflects on possible future patterns. We start with panel regressions explaining the current account of 69 countries during 1981-2006. We identify an asymmetric effect of the US as the "demander of last resort:" a 1% increase in the lagged US current account deficit is associated with 0.5% increase of current account surpluses of countries running surpluses, but with insignificant changes of current account deficits of countries running deficits. Overall, the panel regressions account for not more than 2/3 of the variation. We apply the regression results to assess China's current account over the next six years, projecting a large drop in its account/GDP surpluses
Income inequality, tax base and sovereign spreads by Joshua Aizenman( file )
9 editions published between 2011 and 2012 in English and held by 55 libraries worldwide
This paper investigates the association between greater income inequality, de-facto fiscal space, and sovereign spreads. Using data from 50 countries in 2007, 2009 and 2011, we find that higher income inequality is associated with a lower tax base, lower de-facto fiscal space, and higher sovereign spreads. The economic magnitude of these effects is large: at the margin, a one point of the Gini coefficient of inequality (in a scale of 0-100), is associated in 2011 with a lower tax base of 2 percent of the GDP, and with a higher sovereign spread of 45 basis points
What is the risk of European sovereign debt defaults? : fiscal space, CDS spreads and market pricing of risk by Joshua Aizenman( file )
6 editions published in 2011 in English and held by 54 libraries worldwide
We estimate the pricing of sovereign risk for sixty countries based on fiscal space (debt/tax; deficits/tax) and other economic fundamentals over 2005-10. We measure how accurately the model predicts sovereign credit default swap (CDS) spreads, focusing in particular on the five countries in the South-West Eurozone Periphery (Greece, Ireland, Italy, Portugal, and Spain). Dynamic panel estimates of the model suggest that fiscal space and other macroeconomic factors are statistically significant and economically important determinants of market-based sovereign risk. Although the explanatory power of fiscal space measures drop during the crisis, the TED spread, trade openness, external debt and inflation play a larger role. As expectations of market volatility jumped during the crisis, the weakly concavity of creditors' payoff probably accounts for the emergence of TED spread as a key pricing factor. However, risk-pricing of the South-West Eurozone Periphery countries is not predicted accurately by the model either in-sample or out-of-sample: unpredicted high spreads are evident during global crisis period, especially in 2010 when the sovereign debt crisis swept over the periphery area. We "match" the periphery group with five middle income countries outside Europe that were closest in terms of fiscal space during the European fiscal crisis. We find that Eurozone periphery default risk is priced much higher than the "matched" countries in 2010, even allowing for differences in fundamentals. One interpretation is that the market has mispriced risk in the Eurozone periphery. An alternative interpretation is that the market is pricing not on current fundamentals but future fundamentals, expecting the periphery fiscal space to deteriorate markedly and posing a high risk of debt restructuring. Adjustment challenges of the Eurozone periphery may be perceived as economically and politically more difficult than the matched group of middle income countries because of exchange rate and monetary constraints
Flexibility of Adjustment to Shocks : Economic Growth and Volatility of Middle-Income Countries Before and After the Global Financial Crisis of 2008 by Joshua Aizenman( file )
3 editions published in 2017 in English and held by 53 libraries worldwide
The pronounced and persistent impact of the global financial crisis of 2008 motivates our empirical analysis of the role of institutions and macroeconomic fundamentals on countries' adjustment to shocks. Our empirical analysis shows that the associations of growth level, growth volatility, shocks, institutions, and macroeconomic fundamentals have changed in important ways after the crisis. GDP growth across countries has become more dependent on external factors, including global growth, global oil prices, and global financial volatility. After accounting for the effects global shocks, we find that several factors facilitate adjustment to shocks in middle income countries. Education attainment, share of manufacturing output in GDP, and exchange rate stability increase the level of economic growth, while exchange rate flexibility, education attainment, and lack of political polarization reduce the volatility of economic growth. Countries cope with shocks better in the short to medium term by using appropriate policy tools and having good long-term fundamentals
The fiscal stimulus of 2009-10 : trade openness, fiscal space and exchange rate adjustment by Joshua Aizenman( file )
8 editions published in 2011 in English and held by 52 libraries worldwide
This paper studies the cross-country variation of the fiscal stimulus and the exchange rate adjustment propagated by the global crisis of 2008-9, identifying the role of economic structure in accounting for the heterogeneity of response. We find that greater de facto fiscal space prior to the global crisis and lower trade openness were associated with a higher fiscal stimulus/GDP during 2009-2010 (where the de facto fiscal space is the inverse of the average tax-years it would take to repay the public debt). Lowering the 2006 public debt/average tax base from the level of low-income countries (5.94) down to the average level of the Euro minus the Euro-area peripheral countries (1.97), was associated with a larger crisis stimulus in 2009-11 of 2.78 GDP percentage points. Joint estimation of fiscal stimuli and exchange rate depreciations indicates that higher trade openness was associated with a smaller fiscal stimulus and a higher depreciation rate during the crisis. Overall, the results are in line with the predictions of the neo-Keynesian open-economy model
Capital controls in Brazil - stemming a tide with a signal? by Yothin Jinjarak( file )
8 editions published between 2012 and 2013 in English and held by 48 libraries worldwide
Controls on capital inflows have been experiencing a renaissance since 2008, with several prominent emerging markets implementing them. We focus on Brazil, which instituted five changes in its capital account regime in 2008-2011. Using the synthetic control method, we construct counterfactuals (i.e., Brazil with no policy change) for each of these changes. We find no evidence that any tightening of controls was effective in reducing the magnitudes of capital inflows, but we observe some modest and short-lived success in preventing further declines in inflows when the capital controls were relaxed. We hypothesize that price-based capital controls' only perceptible effect is to be found in the content of the signal they broadcast regarding the government's larger intentions and sensibilities. Brazil's left-of-center government's willingness to remove controls was perceived as a noteworthy indication that the government was not as hostile to the international financial markets as many expected it to be
Fundamentals and sovereign risk of emerging markets by Joshua Aizenman( file )
5 editions published in 2013 in English and held by 47 libraries worldwide
We empirically assess the relative importance of various economic fundamentals in accounting for the sovereign credit default swap (CDS) spreads of emerging markets during 2004-2012, which encompasses the global financial crisis of 2008-2009. Inflation, state fragility, external debt, and commodity terms of trade volatility were positively associated, while trade openness and more favourable fiscal balance/GDP ratio were negatively associated with sovereign CDS spreads. Yet the relative importance of economic fundamentals in the pricing of sovereign risk varies over time. The key factors are trade openness and state fragility in the pre-crisis period, external debt/GDP ratio and inflation in the crisis period, and inflation and public debt/GDP ratio in the post- crisis period. Asian countries enjoy lower sovereign spreads than Latin American countries, and this gap widened during and after the crisis. Trade openness was the biggest factor behind Asia's lower sovereign spreads before the crisis, and inflation during and after the crisis. The results imply that external factors were paramount in pricing sovereign risk prior to the crisis, but internal factors associated with the capacity to adjust to adverse shocks gained prominence during and after the crisis
Real estate valuation, current account and credit growth patterns, before and after the 2008-9 crisis by Joshua Aizenman( file )
6 editions published in 2013 in English and held by 45 libraries worldwide
This paper explores the stability of the key conditioning variables accounting for the real estate valuation before and after the crisis of 2008-9, in a panel of 36 countries, for the period of 2005:I -2012:IV, recognizing the crisis break. Our paper validates the robustness of the association between real estate valuation of lagged current account patterns, both before and after the crisis. The most economically significant variable in accounting for real estate valuation changes turned out to be the lagged real estate valuation appreciation (real estate inflation minus CPI inflation), followed by changes of the current account deficit/GDP, domestic credit/GDP, and equity market valuation appreciation (equity market appreciation minus CPI inflation). The first three effects are economically substantial: a one standard deviation increase in lagged real estate appreciation is associated with a 10 % increase in the present real estate appreciation, much larger than the impact of a one standard deviation increase in the current account deficit (5%) and of the domestic credit/GDP growth (3%). Thus, the results are supportive of both current account and credit growth channels, with the animal-spirits and momentum channels playing the most important role in the boom and bust of real estate valuation
China's growth, stability, and use of international reserves by Joshua Aizenman( file )
6 editions published in 2013 in English and held by 43 libraries worldwide
Since the onset of the global financial crisis, China and the U.S. have reduced their current-account imbalances as a share of GDP to less than half their pre-crisis levels. For China, the reduction in its current-account surplus post-crisis suggests a structural change. Panel regressions for a sample of almost 100 countries over 1983-2013 confirm that the relationship between current-account balances and economic variables changed in important ways after the financial crisis. China's rebalancing has been accompanied by a decline in its reserves-to-GDP ratio and greater outward FDI that, in turn, has mitigated reserve hoarding
Chinese Outwards Mercantilism - the Art and Practice of Bundling by Joshua Aizenman( file )
5 editions published in 2015 in English and held by 38 libraries worldwide
The Global Financial Crisis (GFC) brought to the fore the limits of the Chinese export led-growth strategy and the need for Chinese rebalancing. The Chinese export-led growth strategy of the 2000s coincided with the country becoming one of the largest net global creditors. Intriguingly, the Chinese net income from its global creditor position was negative, reflecting the large share of its low-yielding assets (mostly international reserves), and its high share of high-yielding liabilities (mostly foreign direct investment in China). Our paper takes stock of what may be the next new chapter of Chinese outward-mercantilism, which aims at securing a higher rate of returns on its net foreign asset position, leveraging its success in becoming the global manufacturing hub and the supplier of swap-lines. The emerging new trend has been manifested by Chinese outward-oriented FDI in natural resources, commodities and mining, and providing a wide spectrum of infrastructure and construction services to developing countries. These activities are frequently bundled with access to finance and the export of Chinese capital products and labor services. We trace and analyze these trends, identifying the positive associations between Chinese outward FDI, trade, and finance. The positive association between Chinese outward FDI and commodities imports increases with the provision of RMB swap-lines to China's trading partners. The association between Chinese FDI outflows in the natural resources sector and commodities imports has become stronger since the GFC. The association of RMB swap-lines with the Chinese outward FDI in the natural resources sector is especially large, thus supporting the conjecture that in the aftermath of the GFC Chinese outward FDI is bundled with trade and financial linkages
Vocational education, manufacturing, and income distribution : international evidence and case studies by Joshua Aizenman( file )
3 editions published in 2017 in English and held by 37 libraries worldwide
Economic integration has brought about not only benefits and opportunities but also required adjustment, especially for the youth entering the labor force. The lower growth rates characterizing the post Global Financial Crisis era and the concerns about income inequality put to the fore the degree that better targeted investment in human capital may ameliorate the challenges facing the working poor. Using cross-country data, we find the association between the income shares of the working poor, dependence on manufacturing sector, and the availability of vocational education. Conditioning on tertiary educational attainment, improved access to better vocational education will probably contribute more than large increase in regular college attainment. Comparing the US to Germany suggests that pushing more students to BA granting colleges may no longer be the most efficient way to deal with the challenges caused by the decline in manufacturing employment affecting in particular lower-income households. We also note that a tracking of technical training and educational budget, shown in the case of Vietnam in comparison to Thailand, as well as government subsidies for reskilling of labor force throughout their career in Singapore, is a potential explanation for their relative manufacturing competitiveness
Financial Development and Output Growth in Developing Asia and Latin America a Comparative Sectoral Analysis by Joshua Aizenman( file )
5 editions published in 2015 in English and held by 36 libraries worldwide
We use data from the Groningen Growth and Development Centre (GGDC) database to perform preliminary empirical analysis of the interplay between quality and quantity of finance in accounting for the output growth of ten sectors. We review the existing literature and some salient open questions pertaining to the relationship between financial depth and output growth. Our analysis looks at the finance-growth nexus in 41 economies, including 11 East Asian and 9 Latin American economies for a comparison between two regions which are at similar income levels. We document large differences between the two regions in terms of the impact of financial depth on sectoral growth, and validate the negative impact of financial deepening on output growth in several sectors. Our results suggest that the impact of financial development on growth may be non-linear - i.e. it may promote growth only up to a point
Tax Revenue Trends in Asia and Latin America A Comparative Analysis by Joshua Aizenman( file )
4 editions published in 2015 in English and held by 31 libraries worldwide
We take stock of and compare tax revenue trends in Asia and Latin America. The tax revenues to GDP ratios increased significantly in both regions in the 2000s, although they remain visibly below European levels. Our analysis portrays a complex picture of the tax collection challenges facing developing countries. Overall, there remains sizable heterogeneity in the revenue performance of developing countries, and across regions. While progress has been made, the gap between the advanced economies and developing countries suggests ample room for future fiscal developments, and for more disaggregated studies of the tax mobilization challenges facing developing countries in the aftermath of the global financial crisis
House valuations and economic growth some international evidence by Joshua Aizenman( file )
5 editions published in 2016 in English and held by 31 libraries worldwide
Abstract: This paper evaluates the relation between house prices and economic growth. Using a dataset that covers house prices for 19 countries from the first quarter of 1975 to the third quarter of 2013. We find that house price appreciations are positively associated with economic growth, while the relation between house price depreciations and economic growth is highly non-linear, depending on country-specific characteristics. In the absence of concurrent banking crisis, large house price depreciations (rather than prolonged and modest ones) are positively associated with economic growth. We also find that the positive association between house price depreciations and economic growth is more pronounced in countries with civil-law legal systems, in countries without mortgage insurance or personal bankruptcy law
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Alternative Names
Jinjarak, Yothin
Yothin Jinjarak
Yothin Jinjarak economist (Victoria University of Wellington)
Yothin Jinjarak Wirtschaftswissenschaftler/in (Ph.D., Univ. of California, Santa Cruz, Calif. / Tätig an der Div. of Economics, HSS, Nanyang Technological Univ., Singapore)
English (142)
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