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With a strong recovery from the global crisis, the Philippines’ policy focus will shift again to a long-term development agenda. Despite favorable initial conditions, the Philippines’ long-term growth performance has been disappointing. Over the decades, the economy has suffered from high unemployment, slow poverty reduction, and stagnant investmen...
Citations
... The Philippines, as a lower middle-income country, has been experiencing what has been described as noninclusive growth (Usui 2011;NEDA 2014). ...
... The service sector essentially requires a more educated work force. We need to "Walk on Two Legs", that is, develop our manufacturing sector (Usui 2011). ...
... To achieve inclusive growth, we need to industrialize (Usui 2011), but instead of just "Walking on Two Legs" as Usui suggested, we need to walk on "Three Legs", i.e., development that is not just service sector led, but also a modernized agricultural and industrialization-led growth that is domestic market oriented. ...
... Unemployment and underemployment in the Philippines are among the important problems faced by the industry sector today (Filepe & Lanzona, 2006). These are indicators of the weakness of a country and a reflection on the low industry productivity growth (Usui, 2011). In the recent survey of the Philippine Statistics Authority, the country eased unemployment from 5.7% to 5.3%, however, underemployment increased from 16.1% to 16.4% (De Vera, 2018). ...
The pressing problem of unemployment and underemployment in the Philippines is viewed to be a product of job mismatch which in turn is a result of the diffusion of the interest in academic disciplines in the country. This interest has become the input to the work force of the Philippine industries. The highly diffusive academic disciplines were identified using time series data from 2008 to 2017 enrollment in eighteen tertiary academic disciplines. The spreading of these academic disciplines was then calculated using the Bass diffusion model. The findings showed that the spread of interest in academic disciplines has the characteristic of the Bass diffusion model. Only four among the top ten highly diffusive academic disciplines matched the current industry demands for jobs, an indication of a job mismatch. The contention of the study is that, as long as the selection of students in a tertiary academic discipline continues to be determined through the Bass diffusion model coupled with unmeaningful government policies in education, the country will always lag in its industrial development.
... In the Philippines, Usui (2011), using decomposition analysis, found that unlike other countries in the Association of Southeast Nation (ASEAN) region, growth caused by sectoral reallocation of labor or structural change makes little share to countrywide or overall productivity growth. The minor growth in the overall productivity came from the reallocation of labor from agriculture to services, where productivity has been sluggish but still higher than agriculture. ...
... In the Philippines, Usui (2011) found through decomposition analysis that services-led structural change has not generated enough job opportunities. Over the years, the country is still suffering high unemployment (and underemployment) which is the highest in the ASEAN region. ...
Philippines is considered one of the fastest developing economies because of the growing service sector. This growth brought a significant change in the economic structure of the country which previously relied on the agricultural sector. This paper conducted a study about the significant impact of structural change on labor productivity growth and employment. The paper localized the decomposition analysis used in literatures to extract the share of “within” sector and “structural change” to total changes in labor productivity in the Philippines from 2004-2018, and Applied Pooled Least Square, to obtain the impact of structural change to labor productivity growth and employment. Based on Durbin-Watson test results, both Panel Regression Equation and Seemingly Unrelated Equation were utilized because there is no contemporaneous autocorrelation found in Pooled Least Square. Using Breusch-Pagan LM Test, Panel Regression is deemed more appropriate than Seemingly Unrelated Regression. Furthermore, the decomposition analysis showed that higher share of service sector in employment makes the contribution of “structural change” lesser to labor productivity growth due to labor market that becomes less flexible as service sector dominates the labor market because of higher skillsets needed by the sector. The regression analysis showed that structural change is a significant determinant of employment and labor productivity; structural change has a positive relationship to labor productivity due to the transfer of labor to high-productivity sector; and structural change has a negative relationship to employment because the employment brought by the structural change cannot be absorbed by the labor force because of skills mismatch.
... A equação 2 é a fórmula denominada por Dumagan (2013) de TRAD, por se tratar da decomposição "tradicional" do crescimento da produtividade, a qual remonta aos trabalhos de Denison (1962), com aplicações mais recentes em IMF (2006) e Usui (2011). Na decomposição TRAD as contribuições setoriais para o resultado agregado podem ser divididas em três efeitos. ...
... Sources: Philippine Statistics Authority (2020a) and Sibal (2008) To cite an example, post-1986 administrations gave policy bias for the service sector by providing, among others, incentives to information technology and business process outsourcing (IT-BPO) industry and labor exportation often to the detriment of the domestic manufacturers (Batalla, 2010). 62 As a consequence of such 'development' thrust, the industrial (and manufacturing) sector has stagnated and almost all of the structural change in the past decades happened from agriculture to the service sector (see Figure 15 above) (Ofreneo, 2015;Usui, 2011). As Aldaba (2013) argues: ...
Small and Medium-sized Enterprises (SMEs) are the backbone of many economies. This is especially true in the case of the Philippines, where 99.52% of businesses fall under the category. Yet despite accounting for nearly all firms and employing the majority of the labor force, Philippine SMEs contribute a mere 35.7% to the GDP, performing among the worst in the region. As such, scholars have tried to elucidate this conundrum, with much of the studies underscoring economic and firm-based explanations. Such approaches, however, are limited as they overlook the broader political context in which SMEs operate in. To fill this lacuna, this work has combined interest-based and institutional approaches by using a modified theory of state-business relations as a framework in analyzing the Philippine SME sector. With literature review and key informant interviews as its data gathering instruments, this thesis qualitatively examined the organization of the Philippine state and the SMEs and the nature of the relationship between the two. The findings of this study’s contemporary analysis of state-SMEs relations indicate that, on the government side, the state’s neoliberal orientation has hindered the agencies tasked to develop the SMEs from becoming effective development partners, whereas on the SMEs’ side, the sector is largely unorganized, limiting its potential to serve as a check-and-balance on the government’s inadequate policy implementation. Under these circumstances, the nature of interaction between the two has been beset by issues regarding credibility and transparency, perversely impacting the way SME policies are formulated and implemented. To understand the situation that led to this point, a historical analysis was conducted, particularly by investigating the critical junctures and events that contributed to the formation of the country’s lopsided industrial structure, the unorganized nature of SMEs, and the state’s neoliberal orientation. By and large, this work has demonstrated that, contrary to market fundamentalism, politics matters in development and the economy. It is in this light that the agenda of political empowerment of SMEs is recommended to be taken by scholars, policy-makers, and the SMEs themselves if we are to flip the table that hinders the tiny firms from becoming potent, productive forces in the economy.
... The concerns raised by the critics of aggressive trade liberalization proved to have strong basis considering the substantial discrepancies between pre- dicted and actual outcomes from implementing substantially lower, nearly uniform tariff rates. Contrary to the positive results derived from ex-ante computations, ex-post assessments of a more liberalized trade showed only a fractional positive change in the economy ( Cororaton et al. 2005;Usui 2011;Aldaba 2013). There are several factors that explain the dismal net effect of intensified trade in the Philippines. ...
The strategic behaviour of small powers in the international system can be described in one word: dependence. While a single, universally accepted definition of the term ‘small power’ remains debatable, nonetheless, the extant literature reveals recurring features of their behavioural approaches to world politics.1 First, small powers clearly recognize that it is both futile and reckless to rely exclusively on their own capabilities to obtain security, let alone influence the conduct of world politics to work for their advantage (Toje 2010, 2011). Nevertheless, through concerted actions and efforts, small powers are able to steer the general course of the international politics by manipulating the workings of the system but with limited success. Since small powers do not enjoy a decisive and indispensible role in great powers’ wide range of political and military resources, their policy options are limited to either neutrality or alliance (Mares 1988; Toje 2010, 2011). Under regional hegemony, small powers are bent to pursue a policy of neutrality given the small likelihood of punishment.2 Whereas within an alliance, small powers are compelled to conscientiously follow the directives of the alliance leader and throw all their support to gain favours and avoid upsetting the latter.3 Mares (1988, p. 456) notes that those ‘located in geopolitical regions critical to maintaining a great power’s position in the international system tend to opt for alliance’.
... The concerns raised by the critics of aggressive trade liberalization proved to have strong basis considering the substantial discrepancies between predicted and actual outcomes from implementing substantially lower, nearly uniform tariff rates. Contrary to the positive results derived from ex-ante computations, ex-post assessments of a more liberalized trade showed only a fractional positive change in the economy Usui 2011;Aldaba 2013). There are several factors that explain the dismal net effect of intensified trade in the Philippines. ...
Understanding the motives and rationales behind the small powers’ attempts at linking security and trade requires a detailed understanding of the important events that have precipitated the need for such as a strategy. The shifting political, economic and strategic conditions provide important clues about why and how weaker states use trade to solve their security concerns, and the trade-offs they make to do so. In addition, they also offer critical insights into when strategic innovation takes place, and when such an approach is more or less effective. To provide a complete overview of how the STL strategy is applied at the regional level, first, I trace the roots of these linkages in East Asia and the adjacent regions. After which, I then expound in details the dynamics behind the collective linking efforts of APEC and ASEAN members to show concrete examples of such linkages. This will highlight the types of cohabitative security threats and referents that are addressed and ‘co-habited’ into the respective trade agendas of these two organizations. Finally, a critical evaluation of the issues encountered by member states when linking security and trade is provided to illustrate their implications for the types of linkages formed.
... For most of the period covered in the ex-ante CGE analyses, imports exceeded exports, indicating a trade deficit as a result of trade liberalization (Cororaton, 2004(Cororaton, , 2008Clarete, 2005). In addition, rather than showing fairly diverse exports baskets from a huge number of industries, ex-post assessments revealed a concentration of exports in very few industries (Clarete, 2005;Usui, 2011;Aldaba, 2012Aldaba, , 2013. ...
The highly imbalanced development of the Philippine economy has become an enduring threat to the country’s supposedly people-centric national security. Although the Philippines had earlier on served as a model economy for many of its neighbours, particularly during the post-war period between 1950s and 1960s, however, things went downhill beginning in the 1970s.1 Since then, the country has never quite recovered. The country’s dramatic fall from the top had earned it unenviable titles such as, ‘the sick man of Asia’, and ‘East Asia’s stray cat’ (Noland 2000; White III 2015). At the crux of the Philippines’ extremely uneven economic development is a deeply entrenched patronage system ruled and maintained by powerful Filipino oligarchs. The term ‘oligarchs’ is defined as ‘actors who command and control massive concentrations of material resources that can be deployed to defend or enhance their personal wealth and exclusive social position’ (Winters 2011, p. 6). Accordingly, the ultimate goal of the oligarchs is to continuously expand and secure their position of extreme wealth and power against all forms of threats (Bourguignon & Verdier 2000; Winters 2011).
... The concerns raised by the critics of aggressive trade liberalization proved to have strong basis considering the substantial discrepancies between pre- dicted and actual outcomes from implementing substantially lower, nearly uniform tariff rates. Contrary to the positive results derived from ex-ante computations, ex-post assessments of a more liberalized trade showed only a fractional positive change in the economy ( Cororaton et al. 2005;Usui 2011;Aldaba 2013). There are several factors that explain the dismal net effect of intensified trade in the Philippines. ...
This book examines why and how small powers link their security interests and trade agendas, and how security threats influence the facilitation and outcome of their trade activities. In doing so, it analyses the increasingly complex connections between trade and security, demonstrating how these linkages affect the overall security of four small but important states in East Asia. Focusing on the role of high levels of internal and external insecurities, marginal geo-economic size and peripheral geopolitical position, and multidimensional and multidirectional security contexts and threats, the author concludes that for every security enhancement that a linkage creates a consequent security risk is generated. In other words, Taiwan, Singapore, Malaysia, and the Philippines are effectively trading their security. This innovative book will appeal to political scientists, economists, and security and trade experts.
... For most of the period covered in the ex-ante CGE analyses, imports exceeded exports, indicating a trade deficit as a result of trade liberalization (Cororaton, 2004(Cororaton, , 2008Clarete, 2005). In addition, rather than showing fairly diverse exports baskets from a huge number of industries, ex-post assessments revealed a concentration of exports in very few industries (Clarete, 2005;Usui, 2011;Aldaba, 2012Aldaba, , 2013. ...
