Cuong Le-Van and Nguyen To-The
Total factor productivity (TFP), for a country and for a firm as well, is a crucial element for economic growth by inducing high output. Actually, workers' effort is among the…
Abstract
Purpose
Total factor productivity (TFP), for a country and for a firm as well, is a crucial element for economic growth by inducing high output. Actually, workers' effort is among the important factors that positively influence the TFP.
Design/methodology/approach
In this paper, the authors assume that the wage bonus enhances the worker's effort. Wage bonus is an incentive mechanism and plays a role in the TFP as is shown in a recent paper by Le Van and Pham (2021). The firm will maximize its profits. The supplies of capital and workers are exogenous. At equilibrium, the authors obtain that wage bonus has positive effects on output, labor productivity and price of the output.
Findings
The wage bonus system can make the optimal sequence of outputs grow without bounds. And if the optimal sequence converges to a steady state, this one can be characterized by higher output per capita than that in the steady state without the bonus.
Originality/value
In particular, the result show if, thanks to the wage bonus externality effect, the production may become of increasing returns and if the incentive mechanism is very strong, any optimal path of physical capitals will converge to infinity.
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Binh Tran-Nam, Cuong Le-Van, Van Pham-Hoang and Thai-Ha Le
Cuong Le-Van, Ngoc-Anh Nguyen, Ngoc-Minh Nguyen and Phu Nguyen-Van
The authors estimated the hidden overhead (capital diversion or wasteful use of capital) of Vietnam state-owned enterprises (SOEs).
Abstract
Purpose
The authors estimated the hidden overhead (capital diversion or wasteful use of capital) of Vietnam state-owned enterprises (SOEs).
Design/methodology/approach
The authors used a panel data set of 10,200 Vietnam SOEs observed over the period 2010–2018. The authors modeled and estimated the hidden overhead by using a stochastic production frontier. The hidden overhead parameter is modelled as the technical inefficiency in the production function.
Findings
Vietnam SOEs are very capital intensive. The hidden overhead (or the wasteful use of capital) is very high with an average rate of 69%.
Research limitations/implications
Alternative estimation methods should be used to account for endogeneity in production inputs. Lack of comparison with the Vietnam private firms.
Originality/value
The paper proposes an original way to quantify hidden overhead (or capital diversion) in the Vietnam SOEs. The finding (a capital diversion rate of 69% on average) is astonishing. It calls for an urgent and profound reform of the Vietnam SOEs.
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Cuong Le-Van and Binh Tran-Nam
The principal aim of this paper is to review three basic theoretical growth models, namely the Harrod-Domar model, the Solow model and the Ramsey model, and examine their…
Abstract
Purpose
The principal aim of this paper is to review three basic theoretical growth models, namely the Harrod-Domar model, the Solow model and the Ramsey model, and examine their implications for economic policies.
Design/methodology/approach
The paper utilizes a positivist research framework that emphasizes the causal relationships between the variables in each of the three models. Mathematical methods are employed to formulate and examine the three models under study. Since the paper is theoretical, it does not use any empirical data although numerical illustrations are provided whenever they are appropriate.
Findings
The Harrod-Domar model explains why countries with high rates of saving may also enjoy high rate of economic growth. Both the Solow and Ramsey models can be used to explain the medium-income trap. The paper examines the impact of Covid shocks on the macroeconomy. While the growth rate can be recovered, it may not always possible to recover the output level.
Research limitations/implications
For the Harrod-Domar model, the public spending decreases the private consumption at the period 1, but there is no change in the capital stock and hence the production in subsequent periods. For the Ramsey model with AK production function, both the private consumption and the outputs will be lowered. In both the Harrod-Domar and Ramsey models with Cobb-Douglas production function, if the debt is not high and the interest rate is sufficiently low, it is better to use public debt for production rather than for consumption. If the country borrows to recover the Total Factor Productivity after the Covid pandemic, both the Harrod-Domar and Ramsey models with Cobb-Douglas production function show that the rate of growth is higher for the year just after the pandemic but is the same as before the pandemic.
Practical implications
The economy can recover the growth rate after a Covid shock, but the recovery process will generally take many periods.
Social implications
This paper focuses on economic implications and does not aim to examine social implications of policy changes or Covid-type shock.
Originality/value
The paper provides a comparison of three basic growth models with respect to public spending, public debts and repayments and Covid-type shocks.
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Binh Tran-Nam, Cuong Le-Van and Ngoc-Anh Nguyen
This paper aims to provide rigor and clarity to the current coronavirus disease 2019 (COVID-19) policy debate in Vietnam. It is intended to serve a three-fold purpose. First, it…
Abstract
Purpose
This paper aims to provide rigor and clarity to the current coronavirus disease 2019 (COVID-19) policy debate in Vietnam. It is intended to serve a three-fold purpose. First, it critically examines the framing of policy objectives and the utilization of policy instruments for controlling COVID-19 in Vietnam. Second, it goes beyond policy design to consider the coordination and implementation of COVID-19 policies in Vietnam. Third, it discusses policy measures needed for post-COVID sustainable and inclusive growth, especially the sharing of the public costs of COVID-19 policies.
Design/methodology/approach
The paper employs a positivist research framework that emphasizes the causal relationships between the variables under study. The method of analysis is mixed, combining both qualitative and quantitative techniques. In particular, a simple, theoretical model is constructed to evaluate the welfare effects of alternative vaccine strategies. No primary data were collected.
Findings
The Vietnamese government’s dual goals of containing the pandemic and maintaining economic growth, while being reasonable, need clarification and updating. It is argued that in the longer term, there is no trade-off between saving lives and protecting the economy. The downward revision of the projected growth rate and commitment to a coherent and transparent vaccination strategy is the best way to move forward in Vietnam. The choice of vaccine rollout order involves a consideration of ethics. It is suggested that it is appropriate to vaccinate elderly people and people with underlying medical conditions first. Complementary policy measures to stimulate aggregate demand and supply need to be expanded but also more targeted. Effective coordination and implementation of COVID-19 policies remain a serious challenge for Vietnam. Finally, inclusive growth and sustainable development should take account of human capital development and distributive justice.
Social implications
The paper proposes a number of policy measures which have social impact. These include the government's formal commitment to a vaccine first strategy and a relief package of essential goods to poor and disadvantaged households.
Originality/value
The paper contributes positively to the current COVID-19 policy formulation by providing rigor and clarity to the framing of policy objectives and the utilization of policy instruments. While vaccination has been adopted as a national policy instrument, its design and implementation can be much improved. The paper recommends an appropriate vaccine strategy for Vietnam. It also draws attention to other dimensions of successful policies, namely, communication, coordination, implementation and distributive justice.
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This paper aims to investigate the wage gap between temporary and permanent workers in Pakistan and Cambodia.
Abstract
Purpose
This paper aims to investigate the wage gap between temporary and permanent workers in Pakistan and Cambodia.
Design/methodology/approach
Quantile regression estimator is likely to be the most relevant to the sample.
Findings
The estimates indicate the presence of a temporary employment wage penalty in Pakistan and contrarily a wage premium in Cambodia. Moreover, quantile regression estimates show that wage differentials could greatly vary across the wage distribution. The wage gap is wider at the bottom of the wage distribution in Pakistan, suggesting a sticky floor effect that the penalty of being in temporary jobs could be more severe for disadvantaged workers. By contrast, a glass ceilings effect is found in Cambodia, indicating that the wage premium is small at the bottom and becomes high at the top of the pay ladder.
Originality/value
Despite the rise of temporary jobs in the past several decades, the empirical evidence on wage differentials between temporary and permanent workers is extremely limited in developing Asian countries. This paper is the first research work that systematically examines the temporary-permanent wage gap in selected Asian countries, based on their National Labor Force Survey data.
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The purpose of this paper is to trace the way in which a popular ritual became one of Vietnam’s most important festivals, elevated as a celebration of national heroism and charts…
Abstract
Purpose
The purpose of this paper is to trace the way in which a popular ritual became one of Vietnam’s most important festivals, elevated as a celebration of national heroism and charts its gradual transformation in modern society.
Design/methodology/approach
This research focuses on the combination of a fertility rite and narratives of St Gióng based on nationalism or heroism created a special festival reflecting many traditional cultural characteristics of Vietnam and the Việt people and the transformation of St Gióng from a mythological to a national symbol of heroism in anti-invader history was recorded in texts.
Findings
The paper casts light on the mythologization and historicization of St Gióng in Vietnam’s particular historical context by decoding the Gióng symbol as a core element of the folktales and myths about St Gióng to understand the formation and development of St Gióng in the cultural history of Vietnam.
Research limitations/implications
The paper is not exploring the Gióng symbol within a larger cultural context of nationalism and ethnosymbolic approach in a comparison of national symbolism and heroism.
Practical implications
The paper includes implications for advised scholars to conduct further exploration of the symbol and myth of not only St Gióng in Vietnam but also Kubera in India and Vaisravana in China to connect Kubera, Vaisravana and St Gióng under the connection of literal myth and heroic symbol.
Social implications
The paper shows how processes of historicizing myth and mythologizing history are important features of Vietnamese socio-historical research.
Originality/value
The paper shows how a fertility rite became a historical festival and the figure of St Gióng became a symbol of patriotic heroism.