อาคาร 2 ชั้น 9 ธปท.
Economic impacts of Political Uncertainty in Thailand
This paper aims to analyze political uncertainty in Thailand by looking at various dimensions of political uncertainty and quantifying the economic impacts. Based on keyword search in Thai-language newspapers, the paper proposes five measures related to different aspects of political uncertainty. These are: (1) political protest (2) official measures in dealing with political violence (3) coup d’état (4) parliament dissolution or election and (5) political structural reform, including the aggregate index of political uncertainty. We find that the overall political uncertainty in Thailand has been in the rising trend during the past 20 years. In particular, during the past 10 years, the main source of Thai political uncertainty comes from uncertainty related to political structural reform. Based on various econometric specifications, rising political uncertainty is found to have significant negative impacts on the Thai economy both in the short run – particularly, private investment – and economic growth in the long run. Nevertheless, we find that the degree of the economic impact and statistical significance on different components of macroeconomy is quite varied, reflecting complicated interaction between political factors and economic outcome.
Impact of Lower Rated Journals on Economists’ Judgments of Publication Lists: Evidence from a Survey Experiment
Publications in leading journals are widely known to have a positive impact on economists’ judgments of the value of authors’ contributions to the literature and on their professional reputations. Very little attention has been given, however, to the impacts of the addition of publications in lower rated journals on such judgments. In our main tests, we asked sub-samples of economist in 44 universities throughout the world to rate either a publication list with only higher rated journals or a list with all of these but with additional publications in nearly as many respected but lower rated journals. Our primary finding was that the inclusion of lower rated journals had a statistically significant negative impact on these economists’ judgments of the value of the author’s contribution. To the extent that such judgments may influence research and publication strategies our findings imply negative implications on social welfare.
Trend Inflation Estimates for Thailand from Disaggregated Data
This paper constructs a new trend inflation measure for Thailand based on the multivariate unobserved components model with stochastic volatility and outlier adjustments (MUCSVO) of Stock and Watson (2015). Similar to core inflation, the MUCSVO constructs a measure of the underlying trend based on disaggregated data, but with time-varying sectoral weights that vary with the volatility, persistence and co-movement of the sectoral inflation series. Based on the empirical results, the majority of sectoral weights show significant time-variation, in contrast to their relatively stable expenditure shares. Volatile food and energy sectors that are typically excluded from core inflation measures also turn out to be less volatile, more persistent and explain approximately 10 percent of filtered trend inflation rate movements. Compared to various other trend inflation measures, we show that the MUCSVO delivers trend estimates that are smoother, has narrower confidence bands, and are able to forecast 8 quarter-ahead average inflation more accurately both in-sample and out-of-sample, especially in the post 2000 period.
From Many to One: Minimum Wage Effects in Thailand
This article examines the effects of changing the minimum wage policy structure in Thailand, from multilevel wages set geographically to a single statutory minimum. It exploits the recent hike in the minimum wage to evaluate the effects on employment and wage distribution. We find that employment is weakly affected, with reductions in youth unskilled employment and localised downward adjustments for SMEs. Furthermore, wage distribution seems to have improved. Using an application of the Recentered Influence Function applied to provincial wage distributions, we show that wages are affected up to the 60th percentile, suggesting that minimum wage levels serve as numeraire for wage renegotiation in a Middle Income country context. The hike in the minimum has benefited workers in the 15-45th percentiles, with no discernible effects in the lowest quantiles which appear to be driven by non-compliance among microenterprises.
Floods and Farmers: Evidence from the Field in Thailand
This paper studies the impacts of the 2011 flood on preferences, subjective expectations, and behavioral choices among Thai rice-farming households. Our results show that experiencing the 2011 flood made farming households more risk averse, more impatient, and more altruistic, and that asset-poor farming households were more likely to be affected by the flood than better-off households. The flood also made households adjust upward their subjective expectations of future severe floods. After being hit by the 2011 flood, households lost their confidence in social safety nets, signifying the limitations of risk-sharing in the presence of covariate shocks. Middle-income households who were not prone to floods had higher expectations of public insurance following the flood. Mediating through the changes of preferences and subjective expectations, the flooded households were less likely to save money and engage in self-insurance mechanisms, as well as to invest in productive investments, but more likely to take out commercial crop insurance, especially those in the bottom and middle wealth groups. These findings shed light on the design of incentivecompatible safety nets and development interventions.
Natural Disasters, Preferences, and Behaviors: Evidence from the 2011 Mega Flood in Cambodia
This paper studies the impacts of the 2011 mega flood on preferences, subjective expectations, and behavioral choices among Cambodian rice-farming households. We find flood victims to have larger risk aversion and altruism, and lower impatience and trust of friends and local governments. The disaster also induced flooded households to adjust upward their subjective expectations of future floods and of natural resources as a safety net. Mediating (partially if not all) through these changes in preferences and expectations, the 2011 flood also affected households’ behavioral choices, some of which could further result in long-term economic development and resilience to future floods. We find flooded households to have lower productive investment, to substitute away social insurance by increasing self-insurance and demand for market-based instruments, and more importantly, to increase the use of natural resources as insurance. These findings shed light on the design of incentive-compatible safety nets and development interventions.
The Output Euler Equation and Real Interest Rate Regimes
Output Euler equations (OEE) for the US deliver slope estimates that are not significantly different from zero. This finding is counterintuitive as it implies a zero elasticity of intertemporal substitution (EIS) and aggregate demand movements that are nonresponsive to the short-term real interest rate. This paper shows that failure to account for regime changes in the dynamics of the real interest rate is responsible for the zero EIS result. In doing so, an empirical investigation is carried out based on an unobserved components framework with Markov-switching parameters that models the underlying process for the real interest rate jointly with the OEE. According to the estimation results, the ex-post real interest rate is a highly persistent process with means, variances and degrees of persistence that are different for the periods 1966-1980, 1980-1985, and 1985-2015. Once these changes in real interest rate behavior are taken into account, estimates for the EIS are 0.1 and are no longer statistically insignificant. This finding is robust to various measures of the output gap as well as alternative specifications for the time-varying natural real rate.
Simplified Spectral Analysis and Linear Filters for Analysis of Economic Time Series
We develop and simplify spectral analysis of time series. The main focus is on the spectral representation theorem, Bochner’s theorem, and some key results concerning time-invariant linear filters. We then show how to apply these key results to shed some light on various applications including Yule-Slutsky effects, seasonal adjustment and trend estimation. We also show how spectral analysis can indicate appropriateness of certain statistical models when applied with some economic time series.
Gauging Households’ Debt Tolerance: Evidence from Thailand
Understanding households’ debt tolerance has direct implications on policies addressing high household debt in many Asian economies. This study examines the determinants of debt tolerance and assesses the tolerance level among different household segments. It defines the debt tolerance as the ability to cope with debt without suffering from anxiety and provides empirical evidence based on a survey on Thai households in 2013. Using the IV probit model, the findings indicate that factors important to the debt tolerance include not only debt burden and financial cushion but also income security, financial history, and financial discipline. This suggests that addressing the debt tolerance issue requires a multi-faceted approach. It also highlights the relatively low debt tolerance among households in precarious jobs including farmers, general workers and business owners. The results are robust to a number of alternative specifications.