Open and Closed Economies: Lessons from the Philippines and Vietnam

Description

This book compares the experiences of the Philippines and Vietnam to gain insight into how openness to trade and financing can increase prosperity. In contrast, theoretical and empirical work in the 20th and early 21st centuries have returned mixed results regarding this assertion. The book also demonstrates the impracticality of any attempt to pursue prosperity in isolation. Chapter 1 discusses recent data and research on international trade and capital mobility. Chapter 2 describes the economy of Vietnam that has grown rapidly since beginning to open in 1994. Chapter 3 relates the stagnation of the Philippines as it remained closed from 1960 to 1994 and examines the recent rapid growth in spite of the continued relative restrictiveness of Philippine policy. Chapter 4 compares the two experiences and then conjectures about the feasibility of a prosperous autarky. Preface Contents Notes on Contributors List of Figures List of Tables 1 Open Economies, Closed Economies and a Case Study Introduction The Question What Has Economics Research Taught Us About the Link Between Openness and Prosperity? Research on Capital Mobility in the Form of Foreign Direct Investment International Trade Theory and Empirical Work Trade and Growth Empirical and Theoretical Work on Economic Openness The Evolution of the Volume of Foreign Direct Investment and of International Trade Problems with the Philippines and Vietnam Case References 2 Vietnam: Open, Growing, but with so Much More Potential Vietnam in Earlier Centuries Recent Economic Performance Analysis of the Production and Expenditure Sides of GDP and GDP Growth Production Side Analysis Expenditure Side Analysis An Aperture that is Only Partly Exploited Infrastructure Development in Vietnam Quantity of Investment Efficiency of Investment Project Quality, Governance and Corruption Capital for Infrastructure Investment Towards a Modern Infrastructure for Sustainable Development: Challenges Ahead Conclusion References 3 The Philippines: Decades Lost Introduction: Closure, Opening and Performance of the Philippine Economy A Brief Overview of Philippine International Trade Before 1946 Independence, Original Sin and Barriers to Trade Restrictions on Foreign Ownership and Foreign Direct Investment into the Philippines Economic Results A Closer Look at the Marcos Regime The Philippine Economy Since the 1990s De Iure Opening to Foreign Capital De Facto Inward Movement of Capital De Iure Opening to Trade De facto Opening to Trade An Analysis of GDP Growth The Production Approach Analysis Using the Expenditure Approach to GDP Conclusion References 4 Open and Closed, Prosperity and Stagnation An Overview of the Previous Chapters Further Detail from the Philippines and Vietnam Two Conjectures About Autarky The Reality of International Trade References Index