adb wp011 assar lindbeck - the european social model

8/9/2019 Adb Wp011 Assar Lindbeck - The European Social Model

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ECONOMICS AND RESEARCH DEPARTMENT

ERD WORKING PAPER SERIES NO. 11

Assar Lindbeck

May 2002

Asian Development Bank

The European Social Mod

Lessons for Developing

Countries


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ERD Working Paper No. 11

THE EUROPEAN SOCIAL MODEL:LESSONSFOR DEVELOPING COUNTRIES

Assar Lindbeck

May 2002

Assar Lindbeck is a Professor of International Economics at the Institute for International Economic Studies,

Stockholm University. The author acknowledges Jakob Svensson and Peter Svedberg for useful comments

on a draft of the paper, and Christina Lnnblad for improving the language. This paper was delivered as

a keynote speech at the Conference on Poverty, Growth, and the Role of Institutions, 10-12 October 2001,

Asian Development Bank.


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THE EUROPEAN SOCIAL MODEL: LESSONSFOR DEVELOPING COUNTRIES

14

Asian Development Bank

P.O. Box 789

0980 Manila

Philippines

2002 by Asian Development Bank

May 2002

ISSN 1655-5252

The views expressed in this paper

are those of the author(s) and do not

necessarily reflect the views or policies

of the Asian Development Bank.


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Foreword

The ERD Working Paper Series is a forum for ongoing and recently

completed research and policy studies undertaken in the Asian Development Bank

or on its behalf. The Series is a quick-disseminating, informal publication meant

to stimulate discussion and elicit feedback. Papers published under this Series

could subsequently be revised for publication as articles in professional journals

or chapters in books.


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Contents

Abstract vii

I. General Lessons 1

II. Childhood 4

III. Income and Job Security during Working Age 5

IV. Sick-pay Insurance and Health Care 7

V. Pensions and Old Age Care 9

VI. Conclusion 11

References 12


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Abstract

Developing countries, in particular the least developed ones, probably

have more to learn from social policies in Europe during the early 20th century

than from the elaborate welfare-state arrangements after World War II. In

addition to macroeconomic growth and stability, the main ambitions must be

to fight human deprivation, including illiteracy, malnutrition, and poor access

to water and sanitation; in some cases, also weak, incompetent, and/or corrupt

governments. It is also important that informal systems in the fields of transfersand social services are not destroyed when developing countries embark on more

formal systems in these fields in the future. The European experience also warns

against the creation of social systems that are so generous that disincentives,

moral hazard, and receding social norms seriously distort the national economy,

including the labor market


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1

I. GENERAL LESSONS

In the early 20th century, many European countries still relied heavily on the family both for

income protection and personal (human) services, such as child care and care for the elderly,

and, to some extent, also for health care. Civil society, including so-called friendly societies,

also contributed to income insurance, for instance in connection with sickness, old age, and

unemployment (the latter often with the help of union-run insurance systems). Occupational

pensions also played an important part for government employees. Besides this, government-createdsocial arrangements consisted mainly of selective poverty relief (social assistance) and basic services

in the fields of elementary education and health. In the late 19th and early 20th centuries,

legislation was, however, also introduced for work injury compensation and basic, though quite

modest (lump-sum or means-tested) pensions. In some countries, mainly on the European continent,

the government was also involved in the organization of occupational pensions in the private

sector, primarily in the case of large industrial firms.

Comprehensive systems for income maintenancein the case of childbirth, single

motherhood, unemployment, sickness, old age, etc.were not introduced in Western Europe

(henceforth Europe) until the first decades after World War II, however. Secondary and tertiary

mass education and comprehensive health care for the entire population were built up at about

the same time. It is thus only from the 1960s and 1970s that it makes sense to talk about a welfare

state in Europe. In other words, Europe was already quite rich, as compared to most contemporary

developing countries, when elaborate welfare-state arrangements were created.

Since welfare-state arrangements differ among European countries, talking about a common

European social model is somewhat misleading. Naturally, this observation constitutes the

background to the habit among scholars to classify European countries in terms of different welfare

regimes. The most important difference among countries probably concerns the relative role of the

state, the family, and the market for the provision of income protection and social services. Countries

also differ in terms of the relative roles of universal benefits tied to citizenship, occupational

benefits tied to work, and selective means-tested income support. There is also a considerable

difference in the generosity of benefits and welfare services.As a result of the far-reaching social reforms after World War II, the social arrangements

in Europe are today clearly more comprehensive than in other parts of the world. The achievements

of these arrangements are well known: high-income security for the individual over the life cycle,


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considerably mitigated poverty, and ample provision of various types of social services. The

weaknesses of these social arrangements are also well known today. It turned out that some of

these arrangements were not very financially robust to various types of shocks, for instance, in

terms of demography, productivity growth, and macroeconomic disturbances. The architects of the

welfare state also neglected, or at least underestimated, undesirable behavior adjustments in

response to changes in economic incentives, as a result of explicit and implicit marginal tax wedges

and moral hazard in connection with various benefit systems.

What, then, are the general lessons for developing countries of social policies in Europe?

These countries, in particular the least developed ones, probably have more to learn from social

policies in Europe during the early 20th century than from the elaborate welfare-state arrangements

after World War II. The reason is, of course, that economic resources, socioeconomic structures,

and informal welfare arrangements in the earlier period were more similar to the situation in

todays developing countries than contemporary conditions. In most developing countries, trying

to imitate contemporary welfare-state arrangements in Europe would be a serious mistake. In

particular, this would be the case for transfer payments designed to provide protection againstincome losses for the population as a whole, since such protection is very expensive and also requires

a highly developed administration. Instead, it is reasonable to give priority to the creation of an

environment conducive to entrepreneurship, long-term economic growth, basic health and primary

and (at least in some developing countries) secondary educationas was the case in Europe a

century ago. The fine tuning of welfare-state arrangements in Europe today are often far from

what is needed in developing countries. We have also learned how important macroeconomic stability

is for social conditions. In addition to macroeconomic growth and stability, the main ambitions

must be to fight human deprivation, including illiteracy, malnutrition, poor access to water and

sanitation, and, in some cases, also weak, incompetent, and/or corrupt governments.

It is also important to look at social policies in a broad context, and then identify the

interaction among different types of economic and social variables. Myrdal (1944, appendix 3)

often emphasized processes of cumulative causation, with vicious circles among various poverty-

creating forces: malnutrition damaging health, which in turn results in social exclusion and reduces

the possibilities of acquiring education, which further lowers productivity and political influence,

which goes back to square one by exacerbating malnutrition and social exclusion, etc. Dynamic

processes of this type are well understood today among professional observers of poverty in deve-

loping countries. It is equally important to understand such processes when we try to turn vicious

circles into virtuous ones.

There are, of course, other important similarities among developing countries than their

poverty. Most of these countries are also rural, and they have a young population. It is, however,

also important to emphasize their differences in terms of socioeconomic conditions, administrativecapacities, the role of informal welfare arrangements and economic and social policies. Presumably,

the most important difference is the level of development and the degree of modernization which,

to a considerable extent, is a result of the governments past emphasis on, or neglect of, long-term


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3

Section IGeneral Lessons

economic growth. For instance, governments and ethnic and social groups in some developing

countries, not least in Africa, have clearly been more engaged in power struggles and rent seeking

than in growth enhancing policies. In several South East Asian countries, by contrast, it is fair to

say that concern for economic growth has indeed dominated, also over issues of income security. As

we know, this has been reflected in a heavy emphasis on capital formation. Some of these countries

have, however, also succeeded in combining fast economic growth with a fairly even distribution of

income and wealth, thanks to early land reform and widespread elementary education. The emphasis

on economic growth also shows up in the composition of infrastructure investment, which has been

heavily concentrated on production-oriented structures such as harbors and roads and railways,

rather than facilities directly servicing households, such as housing, sanitation and the environment

in cities and the countryside. This emphasis on growth, of course, reflects an understanding among

policymakers that mass poverty can never be replaced by mass affluence without sustained economic

growth during many decades.

This said, we should not forget that some social arrangements, not just spending on primary

education, might be conducive to long-term economic growth, the most important examples perhapsbeing policies improving the nutrition status and the general health conditions of the poor, in

particular children. Safety nets and systems for income protection may also, up to a point, be

conducive to economic efficiency, since they may enhance political and social stability (Alesina and

Rodrik 1994). But, in particular, we have learned over the years that highly selective social policies

can make a big difference in the living conditions among the poorest sections of a society, also at a

given level of per capita GDP (Sen 1983).

I argued above that it is mainly the European experience of social policies before World

War II, and even before World War I, that should be of interest for social policies in todays developing

countries. For the more affluent ones, however, there are also lessons to be learned from the

contemporary experience of social policies in developed countries. For other developing countries,

the European experience after World War II is probably of interest mainly for contemporary

discussions of social policies far ahead in the future. The latter observation is of some importance

since it often takes a long time before social policy arrangements are in place and functioning

properly. An extreme example is funded social insurance systems, including so-called provident

funds la Malaysia and Singapore, since such systems mature very slowly. However, the most

important message of the paper for developing countries is probably to avoid destroying existing

informal systems. Empirical research suggests that these risks are real (Townsend 1994, Udry

1994).

I will organize my discussion as a sightseeing tour in the welfare landscape, following the

individual from the womb (and hence not just from the cradle) to the tomb.1

1 For a more detailed account of the role of welfare state arrangements over the individuals life cycle, though

without discussion of the lessons for developing countries, see Lindbeck (2002).


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II. CHILDHOOD

Before World War II, the family and other relatives were in charge of most child care in

Europe, though high- and middle-class families also hired helpers (usually girls) in the market.

The main example of government intervention was mandatory and subsidized primary education.

After World War II, three additional government interventions were launched, or greatly expanded:

prenatal care, income transfers (or tax deductions) to families with children and, in some countries,

also subsidized child care outside the family either in institutions (kindergarten) or in the homes of

others (family daycare).

It is generally agreed that the sharp drop in birth rates during the last two decades threatens

the financial viability of various welfare-state arrangements in the long run. An obvious policy

response would be to stimulate child bearing by redistributing income to families with children, in

particular those with many children. Somewhat surprisingly, this has, so far, not occurred to any

large extent, perhaps because families with children are today a highly heterogeneous minority

among voters.There are, however, at least two arguments for more interventionist policy measures in the

case of families with children. First, there is a second-best argument to subsidize child care outside

the family, because of the existence of distortionary taxes favoring tax-free household work at the

expense of taxed work in the labor market. Indeed, government policies in the Nordic countries

have recently followed this second-best route through strong subsidies of child care outside the

family, which is one important explanation for the high labor force participation of women in these

countries.

The other argument for government intervention in the lives of families with small children

is, of course, that schooling has important implications for economic efficiency and the future

distribution of factor income. It is controversial whether the same argument is relevant for child

care of preschool children. In the case of poor families with little education, in particular families

with severe social problems, it is, however, widely believed that child care outside the family enhances

human capital formation and hence the future factor income of such children. This, of course, is

the traditional head-start argument.

Is any of this relevant for developing countries? The fertility problem is, of course, usually

the reverse of the European one; about 40 per cent of the population in many developing countries

are children. It is, however, hazardous (to say the least) to use this observation as an argument for

turning the policy recommendation for Europe upside down for developing countries, hence

recommending redistributions of income to the disadvantage of families with (many) children! We

probably have to rely on traditional birth control policies and compulsory education to convince

families in developing countries to restrict their number of children.As in Europe before World War II, it is natural to expect that child care in developing

countries, for a long time to come, will be pursued by the family and other relativescombined

with privately hired helpers in the case of high- and middle-class families. The most urgent policy


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Section IIIIncome and Job Security during Working Age

interventions in child raising in developing countries must be improved nutrition, fights against

infective diseases for pregnant woman and small children, and primary education. The relevant

methods are commonplace: information about high-nutrition food intake, subsidies of such food for

the poorest section of the population, obstetric care, clean water, sanitation, immunization, and

subsidized compulsory primary education. Indeed, studies in medicine and bio-demography have

shown the importance of these factors for the physical and intellectual development of children

(Behrman 1993, Scrimshaw 1996, United Nations 1997). In particular, the interaction between

infectious diseases and malnutrition for children has turned out to be highly damaging; deficiencies

in these respects are even transmitted to grandchildren. Usually, such policies are not very expensive

as compared to many other types of government spending, for example infrastructure investment

and military spending. It is also an area where technical and economic assistance from the outside

world may be particularly useful. The head-start argument for child care outside the biological

family is probably relevant mainly for orphans and street children in developing countries.

What about education? In the poorest developing countries, there are both efficiency and

distributional reasons to concentrate educational resources on primary schooling, as was the casein Europe during the first decades of the 20th century. There is, however, also an emerging

consensus that a number of developing countries, for instance in Southeast Asia and Latin America,

have reached a level of development where it is appropriate to allocate more resources to secondary

and tertiary education. European experiences during the 20th century suggest that it then makes

sense to put a strong emphasis on a combination of theoretical and vocational trainingalong the

lines of the apprenticeship systems in Austria, Germany, and Switzerland. These countries have

been successful both in creating a skillful labor force, at least in manufacturing, and in keeping

down the level of youth unemployment.

III. INCOME AND JOB SECURITY DURING WORKING AGE

Only very few policy interventions directly designed to enhance income security and job

security existed in Europe before the 1930s; modest unemployment benefits and limited public

works programs during depressions being the main exceptions. Two reasonable explanations are

perhaps that the main beneficiaries of such policies had little political power and that macroeconomic

theories for rationalizing such policies did not exist before the Keynesian revolution.

By contrast, macroeconomic policies have dominated the political agenda in Europe after

World War II. Such policies were also quite successful for a while in the sense that the macroeconomic

performance in Europe was excellent from the economic recovery during the early 1950s to the

mid-1970s. The subsequent situation may be characterized as a continuation of good income securitycombined with dismal employment performance and hence, deteriorating job security for part of

the labor force. An appropriate policy package to improve employment performance would have to

include not only measures strengthening the attractiveness ofoutsiders in the labor market and


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activating their job search, but also measures reducing the market powers ofinsiders (Lindbeck

1996).

What are the lessons, if any, for developing countries from the experience of employment

policies and income protection in Europe? In most developing countries, unemployment benefits

hardly exist, simply because some 60-80 percent of the population are in informal sectors (largely

agriculture). In some of the more affluent developing countries, certain unemployment benefits do

exist, but these are usually neither comprehensive nor generous. In some of the most advanced

developing countries, including some countries in East Asia, there is, however, a quite detailed

labor market legislation, including both minimum wages and job security legislation. But the

implementation of the laws is usually weak or even nonexistent, which is, of course, a disadvantage

for employees who would keep their jobs also with stricter implementation. However, poor imple-

mentation is an advantage for workers who would not have been hired if minimum wages and job

security legislation had been strictly enforced.

As a result of all this, European-type insider-outsider division has largely been avoided in

developing countries, and highly persistent unemployment after negative macroeconomic shocksdo not seem to be prevalent. There is, instead, often considerable segmentation between privileged

employees in the public sector, and in some cases also in large firms, on the one hand, and less

privileged employees in smaller firms, on the other hand.

Moreover, some of the more affluent developing countries seem to be strongly exposed to

negative macroeconomic shocks. This problem can probably be mitigated to some extent by floating

exchange rates or, in some case, by membership in a large monetary union where the countrys

trade is concentrated. Another macroeconomic problem is that both financial institutions and

production firms have often neglected their balance sheets, which appears in low equity capital

and much short-term borrowing (often also in the form of uncovered loans in foreign currencies).

I understand this to have been an important factor behind the financial crisis in East Asia in the

late 1990s. Tougher authorities in the field of financial inspection are thus called for. In view of

the severe social problems in connection with recurring macroeconomic crises in developing countries,

the first, and perhaps most important, line of defense for job and income security must be good

macroeconomic institutions, well-consolidated firms, and a reasonably good macroeconomic policy,

including an appropriate exchange rate system.

Sooner or later, the population in developing countries will certainly demand a second line

of defense, in the form of income protection. It is well known that systems of unemployment insurance

do not easily spontaneously emerge via voluntary market transactions due to problems of adverse

selection. Either the state or unions must intervene to create comprehensive unemployment benefit

systems. It is then, of course, important to realize that the generosity and the duration for the

benefits must be kept within certain bounds to mitigate moral hazard problems.In countries with a particularly low per capita income and quite a small formal production

sector, ethical considerations probably point to a safety net solution, rather than comprehensive

unemployment insurance, designed to provide income protection in proportion to previous income.


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Section IVSick-pay Insurance and Health Care

The purpose would be to secure elementary entitlements such as food, shelter, clothing, and basic

health. Such safety nets could, of course, operate by quite different methods: public work programs;

subsidized work in the private sector for unemployed workers; needs-based cash transfers (social

assistance or welfare) to poor people in general; selective transfers in kind (food programs such

as food stamps); or subsidies to basic consumption. Administrative feasibility, including the precision

of targeting, is presumably a crucial aspect in the choice of method.

The administrative difficulties in running such programs in developing countries are

accentuated by the problem of knowing when the family is able and willing to provide income

security to its members and when this is not the case. There may be some experiences from Southern

Europe, for example Italy, on how to handle, or not handle, safety nets in societies with weak

government administration and frequent cohabitation of parents and adult children.

Moreover, considering the dominating role of agriculture in most developing countries,

crop insurance programs are often more important than unemployment insurance. Local, so-called

micro- and area-based, protection for small farmers is another example of income protection

programs that should perhaps be relied on to a larger extent today and in the near future.

IV. SICK-PAY INSURANCE AND HEALTH CARE

In Europe before World War II, personal savings, support from relatives and friends, and

individual insurance schemes dominated as methods for mitigating economic setbacks in connection

with health problems. Mandatory sick-pay insurance, usually administrated by government

agencies, is basically a post World War II phenomenon. Since these systems are quite generous

today, with replacement rates often in the interval of 70-100 percent, governments in Europe

have no doubt succeeded in reallocating income to periods when the individual is temporarily sick,

and hence to protect consumption during such periods. In a considerable part of Europe, sick-pay

benefits, like unemployment benefits, are, however, tied to previous earnings, which favors

individuals with stable employment. This means that the insider-outsider division of the labor

market is transmitted to periods of bad health.

In several European countries, the sick-pay insurance systems have recently run into serious

financial difficulties. One reason is moral hazard, for instance, when an individual calls sick when

feeling tired on a Monday morning. The consequences of moral hazard may be accentuated by

receding social norms against exploiting the systems, when individuals observe that others do this.

To the extent that these factors explain the rising costs of sick-pay insurance, more waiting days,

coinsurance, and stricter administration of the benefit system would be rational policy responses.

In some countries, including Sweden, higher costs for sick-pay insurance are, however,more related to long-term than to short-term sick leave. Double work by women is probably a

reason, since they still do the bulk of household work, including child care in the home,

simultaneously with work in the labor market. In this sense, women have paid a high psychological


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price for their increased labor market participation. There is also some speculation in the general

discussion to the effect that reorganization of work, with increased requirements of efficiency and

individual responsibility, has contributed to the stress at work.

If these are important explanations, the problems might be mitigated both by improvements

in the work environment and by a greater responsibility for household work, including child care,

among men. The first may be achieved by experience-rated insurance fees for firms (higher fees

for firms with many sick days). It is more difficult to design policies that shift household work from

women to men, since this would require that the government intervene in the lives of families.

Such policies, however, already exist to some extent in Denmark and Sweden, since men are

offered nontransferable rights to stay at home to take care of small children, without much loss of

income.

What about developing countries? In most of these, sick leave is basically financed as in

Europe during the first decades of the 20th century, i.e., via relatives and civil society. In countries

with more formal systems of health insurance, i.e., mainly the most affluent among developing

countries, these systems are usually highly fragmented, with separate arrangements for differentindustries, professions and firms. If more elaborate sick-pay insurances are created in developing

countries in the future, the European experience illustrates the importance of watching out for

moral hazard and changes in social norms. For that reason, it is important to keep the generosity

of the system within bounds, and make the administrative controls tight, not least to prevent

physicians from being overly generous in certifying the needs for sick leave.

What, then, is the experience ofhealth care services in Europe? In general terms, the basic

problem is how to combine insurance, incentives, and freedom of choice. All health care systems

are today exposed to serious cost problems, since the third party pays. Insuranceschemes, in

particular when based on cost-plus financing, tend to generate particularly rapid increases in

costs, which is strikingly illustrated by the experience in Germany and the United States. Canada

has succeeded better in containing costs in its health care insurance systems by relying on fixed

budgets for health providers and price control of services. Tax-financed health services of the UK

National Health Service (NHS) type have typically been better at containing health care costs.

But this has been achieved by strict rationing, i.e., queues and waiting lists (which also is a problem

in Canada), and high stress levels at work for the personnel.

Are there any lessons for developing countries from health care in developed countries?

Most well informed observers probably agree that it makes sense for developing countries to

emphasize fights against infectious diseases and malnutrition, not least for pregnant women and

small children. This may mean that comprehensive treatments of heart disease, cancer, and other

ailments characteristic of a rich and aging population, would have to be postponed. Concretely,

this means information and subsidies in the field of sanitation and primary health care and probablyalso information about the importance of a healthy life style, including less smoking. The

surveillance of public and private health care units, with very uneven qualities, is also of potential

importance. In a somewhat longer perspective, there are also strong cases for mandatory health


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Section VPensions and Old-age Care

insurance for catastrophic health care, co-payments, and the mobilization of more resources for

health care in the private sector. In many countries, it is also important to increase the salaries of

doctors and nurses.

Apart from this, it is important to allow and stimulateexperimentation, which requires

considerable freedom of entry of nongovernment health providersfor nonprofit as well as profit

organizations. I then assume that it is better to allow decentralized experimentation, rather than

keep existing systems intact or, as often occurs, have the government conduct full scale experiments

for a whole country. It is also important to avoid destroying whatever nongovernment networks

exist via families and civil society.2

V. PENSIONS AND OLD-AGE CARE

While mandatory pension systems in Europe have been instrumental for providing income

security for the elderly, governments have played a much more modest role in the field of care forthe elderly. As we know, both fields encounter serious problems today. To the extent that

contemporary, and projected future, financial problems of the pension systems are caused by low

birth rates in the past, conceivable remedies would be to boost nativity (with considerable time lag

before the size of the labor force is influenced) and encourage the immigration of young individuals

of working age. Unfortunately, it is not obvious that governments can do much about birth rates

(except perhaps provide good child care outside the family), and there may be social limits to

immigration because of the risks of ethnical tensions in the countries of immigration. To the extent

that financial problems for pension systems are related to a higher longevity of individuals after

retirement, raising the statutory pension age and removing subsidies to early retirement are instead

natural remedies. But to avoid heavy unemployment among the elderly in connection with later

retirement, it is also important to allow greater flexibility in relative wages (for workers of different

ages) and increase the possibilities for retirees to individually choose the length of their work week.

It is today also increasingly understood in Europe that the pay-as-you-go (PAYGO) pension

systems create disincentive problems for work via implicit tax wedges. The reason is, of course, that

the link between the contributions and the subsequent pension benefits for the individual is usually

quite weak. An obvious way of mitigating this incentive problem is to tighten the link, hence

making the pension systems more actuarial, or quasi-actuarial (since the return on mandatory

pension saving would be lower than the return in financial markets). There is also a case for a

partial shift to a funded pension system. The individual then would be able to enjoy a more diversified

portfolio of pension claims than ineither a pure PAYGO system, where the (risky) return depends

on the growth rate of the tax base, or a pure funded system where the (risky) return depends on

2 The role of such networks in developing countries is still an under-researched field.


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developments in financial markets. The reason is, of course, that these two types of returns are not

fully correlated, in particular if the pension funds invest in international capital markets.

What is the relevance of all this for the financing of retirement in developing countries? In

most such countries, informal systems, in particular via relatives, are likely to dominate for a long

time to come. Sooner or later, there will, however, be a strong ethical case for government intervention

to mitigate poverty among the elderlyan application of the safety net idea to the retirement

period. A basic pension in the form of a lump sum payment, equal for all elderly, or means-tested

pension benefits, are then obvious alternatives. This corresponds to the World Banks (1993)

recommendation for a universal first-tier pension. An additional advantage of such a system, in

principle, is that it is rather equitable if financed by tax payments that increase with income. But

in many developing countries, only a few percent of the population pay income taxes, or can be

exposed to payroll taxes, which, of course, means that the financing would be a serious administrative

obstacle.

In the long run, the expanding middle class will, however, hardly be satisfied with either a

basic pension or means-tested pension benefits. This group is likely to ask for income protection insome proportion to previous income, as in todays developed countries, partly in response to a

gradually reduced importance of transfers within families. As we know, some developing countries

have already started to build up mandatory pension systems of this type: funded systems in Chile

and Malaysia and some other countries in Latin American; while Korea, Philippines, and Thailand

have chosen social security systems. Advocates of mandatory, funded pension systems in deve-

loped countries have often referred to the importance of boosting aggregate national saving, which

is easiest if a funded system is created from scratch. While the argument for such a boost may be

important for some developing countries, it hardly has much strength in developing countries with

high national saving rates, such as some countries in East Asia.

In the future, when comprehensive pension systems probably will exist in todays developing

countries, the same financial problems as in todays developed countries are likely to occur. Falling

fertility and increased longevity seem to be inevitable developments in the modern world, and

even the fastest growing countries will sooner or later experience slower productivity growth. In

the few developing countries where formal pension systems already exist, the pension age is usually

quite low (relative to life expectancy). Thus, there is great room for defending, or improving, the

financial position of these systems by raising the retirement age, for instance, from 55 to 67 or

even 70. Some developing countries may also find it easier than many countries in Europe to

accommodate the elderly in the labor market, since they have had arrangements for work for the

elderly for a long time, and since relative wages are often more flexible than in Europe. It remains

to be seen whether these conditions will prevail.

Contemporary financial and organizational problems in the field ofold-age care in developedcountries are related to the demographic factors of the same type as those that have created problems

for the pension system. The organizationaldifficulties are instead rather similar to the problems of

health care: it is difficult to combine solidarity-oriented financing with production efficiency and


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Section VIConclusion

freedom of choice. Old-age care is also hurt by Baumols Law (Baumol 1967), which explains why

costs and prices tend to increase particularly fast in the case of labor intensive services like human

care. Another issue concerns the freedom of choice of services for the elderly. Such freedom is, in

principle, easy to bring about in the case of service in the elderlys homesshopping, cooking,

cleaning etc.like in child care and care for the elderly. Service checks (vouchers) are an obvious

tool. Vouchers are less useful in the case of institutionalized old-age care, since the needs for

medical care vary enormously among patients. Still it would certainly be possible to offer considerable

freedom of choice of service institution for the elderly.

It will take some time before most developing countries encounter similar problems, not

only because the population is still young, but also because the family is likely to supply care

services to the elderly for a long time to come. But it may be a good idea at least to start thinking,

and perhaps also experimenting, with alternative systems of care for the elderly before there is an

acute need to expand formal systems in this field. In the long run, it is not likely that family

members and other relatives can be relied on to service the elderly any more in todays developing

countries than in Europe.

VI. CONCLUSION

The experiences of social policies during the first decades of the 20th century in Europe

underline the important role of informal systems for income security and personal services at low

levels of economic development. It is crucial, however, that informal systems are not destroyed

when developing countries embark on more formal systems in these fields in the future. I have

also emphasized that the European experience warns against the creation of social systems that

are so generous that disincentives, moral hazard, and receding social norms seriously distort the

national economy, including the labor market. These risks seem to be particularly important in the

case of unemployment benefits, support to single mothers, sick leave, disability pensions and early

retirement. If disincentives and moral hazard undermine the financial viability of government-

operated systems, and these would therefore have to be cut back, many individuals may suddenly

find themselves without both types of social systems.


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12

REFERENCES

Alesina, A., and D. Rodrik, 1994. Distributive Politics and Economic Growth. Quarterly Journal

of Economics May:465-90.

Baumol, W. J., 1967. The Macroeconomics of Unbalanced Growth: The Anatomy of Urban Crisis.

American Economic Review 57:415-26.

Behrman, J. R., 1993. The Economic Rationale for Investing in Nutrition in Developing Countries.

World Development 21:1749-71.

Lindbeck, A., 1996. The West European Employment Problems. Weltwirtschaftliches Archiv

December:3-31.

, 2002. Improving the Performance of the European Social Model. Paper presented at a

Conference at the IESE Business School, Barcelona, 27 November 2001.

Myrdal, G., 1944.An American Dilemma. Carnegie Foundation, New York.

Scrimshaw, N. S., 1996. Nutrition and Health from Womb to Tomb.Nutrition Today 31:55-67.

Sen, A., 1983. Development: Which Way Now? The Economic Journal December:745-62.Townsend, R. M., 1994. Risk and Insurance in Village India.Econometrica 62(39):539-91.

Udry, C., 1994. Risk and Insurance in Rural Credit Markets: An Empirical Investigation in Northern

Nigeria.Review of Economic Studies 61:495-526.

United Nations, 1997. Subcommittee on Nutrition. Geneva.

World Bank, 1993.Averting the Old Age Crisis. Oxford: Oxford University Press.


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PUBLICATIONS FROM THE

ECONOMICS AND RESEARCH DEPARTMENT

No. 8 Shadow Exchange Rates and StandardConversion Factors in Project Evaluation

Peter Warr, September 1982No. 9 Small and Medium-Scale Manufacturing

Establishments in ASEAN Countries:

Perspectives and Policy IssuesMathias Bruch and Ulrich Hiemenz,

January 1983No. 10 A Note on the Third Ministerial Meeting of GATT

Jungsoo Lee, January 1983No. 11 Macroeconomic Forecasts for the Republic

of China, Hong Kong, and Republic of Korea J.M. Dowling, January 1983

No. 12 ASEAN: Economic Situation and Prospects

Seiji Naya, March 1983No. 13 The Future Prospects for the Developing

Countries of Asia

Seiji Naya, March 1983No. 14 Energy and Structural Change in the Asia-

Pacific Region, Summary of the Thirteenth

No. 1 ASEAN and the Asian Development BankSeiji Naya, April 1982

No. 2 Development Issues for the Developing East

and Southeast Asian Countriesand International CooperationSeiji Naya and Graham Abbott, April 1982

No. 3 Aid, Savings, and Growth in the Asian Region J. Malcolm Dowling and Ulrich Hiemenz,

April 1982No. 4 Development-oriented Foreign Investment

and the Role of ADB Kiyoshi Kojima, April 1982

No. 5 The Multilateral Development Banksand the International Economys MissingPublic Sector John Lewis, June 1982

No. 6 Notes on External Debt of DMCs Evelyn Go, July 1982

No. 7 Grant Element in Bank Loans

Dal Hyun Kim, July 1982

ERD WORKING PAPER SERIES (WPS)

(Published in-house; Available through ADB Office of External Relations; Free of Charge)

No. 1 Capitalizing on Globalization

Barry Eichengreen, January 2002No. 2 Policy-based Lending and Poverty Reduction:

An Overview of Processes, Assessment

and Options

Richard Bolt and Manabu Fujimura January 2002

No. 3 The Automotive Supply Chain: Global Trendsand Asian PerspectivesFrancisco Veloso and Rajiv Kumar

January 2002No. 4 International Competitiveness of Asian Firms:

An Analytical Framework

Rajiv Kumar and Doren Chadee February 2002

No. 5 The International Competitiveness of AsianEconomies in the Apparel Commodity Chain

Gary Gereffi February 2002

No. 6 Monetary and Financial Cooperation in East

AsiaThe Chiang Mai Initiative and Beyond

Pradumna B. Rana February 2002

No. 7 Probing Beneath Cross-national Averages: Poverty,

Inequality, and Growth in the Philippines

Arsenio M. Balisacan and Ernesto M. PerniaMarch 2002

No. 8 Poverty, Growth, and Inequality in Thailand

Anil B. DeolalikarApril 2002

No. 9 Microfinance in Northeast Thailand: Who Benefitsand How Much?

Brett E. Coleman April 2002

No. 10 PovertyReduction and the Role of Institutions inDeveloping Asia

Anil B. Deolalikar, Alex B. Brilliantes, Jr.,Raghav Gaiha, Ernesto M. Pernia, Mary Raceliswith the assistance of Marita Concepcion Castro-Guevara, Liza L. Lim, Pilipinas F. Quising May 2002

No. 11 The European Social Model: Lessons forDeveloping Countries

Assar Lindbeck May 2002

MONOGRAPH SERIES

(Published in-house; Available through ADB Office of External Relations; Free of charge)

EDRC REPORT SERIES (ER)

ERD TECHNICAL NOTE SERIES (TNS)


No. 1 Contingency Calculations for EnvironmentalImpacts with Unknown Monetary Values

David DoleFebruary 2002


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14

Pacific Trade and Development Conference

Seiji Naya, March 1983No. 15 A Survey of Empirical Studies on Demand

for Electricity with Special Emphasis on Price

Elasticity of DemandWisarn Pupphavesa, June 1983

No. 16 Determinants of Paddy Production in Indonesia:

1972-1981A Simultaneous Equation ModelApproachT.K. Jayaraman, June 1983

No. 17 The Philippine Economy: Economic

Forecasts for 1983 and 1984 J.M. Dowling, E. Go, and C.N. Castillo, June 1983

No. 18 Economic Forecast for IndonesiaJ.M. Dowling, H.Y. Kim, Y.K. Wang,

and C.N. Castillo, June 1983No. 19 Relative External Debt Situation of Asian

Developing Countries: An Application

of Ranking Method Jungsoo Lee, June 1983

No. 20 New Evidence on Yields, Fertilizer Application,

and Prices in Asian Rice ProductionWilliam James and Teresita Ramirez, July 1983

No. 21 Inflationary Effects of Exchange Rate

Changes in Nine Asian LDCsPradumna B. Rana and J. Malcolm Dowling,

Jr., December 1983

No. 22 Effects of External Shocks on the Balanceof Payments, Policy Responses, and DebtProblems of Asian Developing Countries

Seiji Naya, December 1983No. 23 Changing Trade Patterns and Policy Issues:

The Prospects for East and Southeast AsianDeveloping Countries

Seiji Naya and Ulrich Hiemenz, February 1984No. 24 Small-Scale Industries in Asian Economic

Development: Problems and Prospects

Seiji Naya, February 1984No. 25 A Study on the External Debt Indicators

Applying Logit Analysis

Jungsoo Lee and Clarita Barretto,February 1984

No. 26 Alternatives to Institutional Credit Programs

in the Agricultural Sector of Low-Income

CountriesJennifer Sour, March 1984

No. 27 Economic Scene in Asia and Its Special Features Kedar N. Kohli, November 1984

No. 28 The Effect of Terms of Trade Changes on the

Balance of Payments and Real NationalIncome of Asian Developing Countries Jungsoo Lee and Lutgarda Labios, January 1985

No. 29 Cause and Effect in the World Sugar Market:Some Empirical Findings 1951-1982Yoshihiro Iwasaki, February 1985

No. 30 Sources of Balance of Payments Problemin the 1970s: The Asian Experience Pradumna Rana, February 1985

No. 31 Indias Manufactured Exports: An Analysisof Supply Sectors Ifzal Ali, February 1985

No. 32 Meeting Basic Human Needs in AsianDeveloping Countries Jungsoo Lee and Emma Banaria, March 1985

No. 33 The Impact of Foreign Capital Inflowon Investment and Economic Growthin Developing Asia Evelyn Go, May 1985

No. 34 The Climate for Energy Developmentin the Pacific and Asian Region:Priorities and Perspectives

V.V. Desai, April 1986No. 35 Impact of Appreciation of the Yen on

Developing Member Countries of the Bank

Jungsoo Lee, Pradumna Rana, and Ifzal Ali, May 1986

No. 36 Smuggling and Domestic Economic Policies

in Developing Countries A.H.M.N. Chowdhury, October 1986

No. 37 Public Investment Criteria: Economic Internal

Rate of Return and Equalizing Discount Rate Ifzal Ali, November 1986

No. 38 Review of the Theory of Neoclassical Political

Economy: An Application to Trade Policies

M.G. Quibria, December 1986No. 39 Factors Influencing the Choice of Location:Local and Foreign Firms in the Philippines E.M. Pernia and A.N. Herrin, February 1987

No. 40 A Demographic Perspective on Developing

Asia and Its Relevance to the Bank E.M. Pernia, May 1987

No. 41 Emerging Issues in Asia and Social Cost

Benefit Analysis I. Ali, September 1988

No. 42 Shifting Revealed Comparative Advantage:

Experiences of Asian and Pacific DevelopingCountriesP.B. Rana, November 1988

No. 43 Agricultural Price Policy in Asia:Issues and Areas of Reforms I. Ali, November 1988

No. 44 Service Trade and Asian Developing Economies M.G. Quibria, October 1989

No. 45 A Review of the Economic Analysis of Power

Projects in Asia and Identification of Areasof Improvement I. Ali, November 1989

No. 46 Growth Perspective and Challenges for Asia:

Areas for Policy Review and Research I. Ali, November 1989

No. 47 An Approach to Estimating the Poverty

Alleviation Impact of an Agricultural Project I. Ali, January 1990

No. 48 Economic Growth Performance of Indonesia,

the Philippines, and Thailand:The Human Resource Dimension E.M. Pernia, January 1990

No. 49 Foreign Exchange and Fiscal Impact of a Project:

A Methodological Framework for Estimation I. Ali, February 1990

No. 50 Public Investment Criteria: Financialand Economic Internal Rates of Return

I. Ali, April 1990No. 51 Evaluation of Water Supply Projects:

An Economic FrameworkArlene M. Tadle, June 1990

No. 52 Interrelationship Between Shadow Prices, ProjectInvestment, and Policy Reforms:

An Analytical Framework

I. Ali, November 1990No. 53 Issues in Assessing the Impact of Project

and Sector Adjustment Lending

I. Ali, December 1990No. 54 Some Aspects of Urbanization

and the Environment in Southeast Asia

Ernesto M. Pernia, January 1991No. 55 Financial Sector and Economic

Development: A Survey

Jungsoo Lee, September 1991No. 56 A Framework for Justifying Bank-Assisted

Education Projects in Asia: A Reviewof the Socioeconomic Analysis

and Identification of Areas of ImprovementEtienne Van De Walle, February 1992

No. 57 Medium-term Growth-Stabilization

Relationship in Asian Developing Countriesand Some Policy Considerations


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15

Yun-Hwan Kim, February 1993No. 58 Urbanization, Population Distribution,

and Economic Development in Asia Ernesto M. Pernia, February 1993

No. 59 The Need for Fiscal Consolidation in Nepal:The Results of a SimulationFilippo di Mauro and Ronald Antonio Butiong,

July 1993No. 60 A Computable General Equilibrium Model

of Nepal

Timothy Buehrer and Filippo di Mauro,

October 1993No. 61 The Role of Government in Export Expansionin the Republic of Korea: A RevisitYun-Hwan Kim, February 1994

No. 62 Rural Reforms, Structural Change,

and Agricultural Growth inthe Peoples Republic of China

Bo Lin, August 1994No. 63 Incentives and Regulation for Pollution Abatement

with an Application to Waste Water TreatmentSudipto Mundle, U. Shankar,and Shekhar Mehta, October 1995

No. 64 Saving Transitions in Southeast Asia Frank Harrigan, February 1996

No. 65 Total Factor Productivity Growth in East Asia:A Critical Survey

Jesus Felipe, September 1997No. 66 Foreign Direct Investment in Pakistan:

Policy Issues and Operational ImplicationsAshfaque H. Khan and Yun-Hwan Kim, July 1999

No. 67 Fiscal Policy, Income Distribution and Growth

Sailesh K. Jha, November 1999

No. 1 International Reserves:Factors Determining Needs and Adequacy

Evelyn Go, May 1981

No. 2 Domestic Savings in Selected Developing Asian Countries

Basil Moore, assisted by A.H.M. Nuruddin Chowdhury, September 1981

No. 3 Changes in Consumption, Imports and Exports

of Oil Since 1973: A Preliminary Survey ofthe Developing Member Countriesof the Asian Development Bank

Dal Hyun Kim and Graham Abbott,September 1981

No. 4 By-Passed Areas, Regional Inequalities,

and Development Policies in SelectedSoutheast Asian CountriesWilliam James, October 1981

No. 5 Asian Agriculture and Economic DevelopmentWilliam James, March 1982

No. 6 Inflation in Developing Member Countries:

An Analysis of Recent Trends A.H.M. Nuruddin Chowdhuryand

J. Malcolm Dowling,March 1982No. 7 Industrial Growth and Employment in

Developing Asian Countries: Issues andPerspectives for the Coming Decade

Ulrich Hiemenz, March 1982No. 8 Petrodollar Recycling 1973-1980.

Part 1: Regional Adjustments and

the World EconomyBurnham Campbell, April 1982

No. 9 Developing Asia: The Importance

of Domestic PoliciesEconomics Office Staff under the direction

of Seiji Naya, May 1982No. 10 Financial Development and Household

Savings: Issues in Domestic Resource

Mobilization in Asian Developing CountriesWan-Soon Kim, July 1982

No. 11 Industrial Development: Role of SpecializedFinancial Institutions Kedar N. Kohli, August 1982

No. 12 Petrodollar Recycling 1973-1980.Part II: Debt Problems and an Evaluationof Suggested Remedies

Burnham Campbell, September 1982No. 13 Credit Rationing, Rural Savings, and Financial

Policy in Developing Countries

William James, September 1982

No. 14 Small and Medium-Scale ManufacturingEstablishments in ASEAN Countries:

Perspectives and Policy Issues

Mathias Bruch and Ulrich Hiemenz, March 1983No. 15 Income Distribution and Economic

Growth in Developing Asian Countries J. Malcolm Dowling and David Soo, March 1983

No. 16 Long-Run Debt-Servicing Capacity of

Asian Developing Countries: An Applicationof Critical Interest Rate Approach Jungsoo Lee, June 1983

No. 17 External Shocks, Energy Policy,and Macroeconomic Performance of AsianDeveloping Countries: A Policy Analysis

William James, July 1983No. 18 The Impact of the Current Exchange Rate

System on Trade and Inflation of Selected

Developing Member Countries Pradumna Rana, September 1983

No. 19 Asian Agriculture in Transition: Key Policy Issues

William James, September 1983No. 20 The Transition to an Industrial Economy

in Monsoon Asia

Harry T. Oshima, October 1983No. 21 The Significance of Off-Farm Employment

and Incomes in Post-War East Asian Growth

Harry T. Oshima, January 1984No. 22 Income Distribution and Poverty in Selected

Asian Countries

John Malcolm Dowling, Jr., November 1984No. 23 ASEAN Economies and ASEAN Economic

Cooperation

Narongchai Akrasanee, November 1984No. 24 Economic Analysis of Power Projects

Nitin Desai, January 1985No. 25 Exports and Economic Growth in the Asian Region

Pradumna Rana, February 1985

No. 26 Patterns of External Financing of DMCs E. Go, May 1985

No. 27 Industrial Technology Developmentthe Republic of KoreaS.Y. Lo, July 1985

No. 28 Risk Analysis and Project Selection:A Review of Practical Issues J.K. Johnson, August 1985

No. 29 Rice in Indonesia: Price Policy and ComparativeAdvantage I. Ali, January 1986

No. 30 Effects of Foreign Capital Inflows

ECONOMIC STAFF PAPERS (ES)


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16

No. 1 Poverty in the Peoples Republic of China:Recent Developments and Scope

for Bank Assistance K.H. Moinuddin, November 1992

No. 2 The Eastern Islands of Indonesia: An Overview

of Development Needs and PotentialBrien K. Parkinson, January 1993

No. 3 Rural Institutional Finance in Bangladesh

and Nepal: Review and Agenda for Reforms A.H.M.N. Chowdhury and Marcelia C. Garcia,

November 1993No. 4 Fiscal Deficits and Current Account Imbalances

of the South Pacific Countries:A Case Study of Vanuatu

T.K. Jayaraman, December 1993

No. 5 Reforms in the Transitional Economies of Asia Pradumna B. Rana, December 1993

No. 6 Environmental Challenges in the Peoples Republicof China and Scope for Bank AssistanceElisabetta Capannelli and Omkar L. Shrestha,

December 1993No. 7 Sustainable Development Environment

and Poverty Nexus

K.F. Jalal, December 1993No. 8 Intermediate Services and Economic

Development: The Malaysian Example

Sutanu Behuria and Rahul Khullar, May 1994No. 9 Interest Rate Deregulation: A Brief Survey

of the Policy Issues and the Asian Experience

Carlos J. Glower, July 1994

OCCASIONAL PAPERS (OP)

on Developing Countries of Asia

Jungsoo Lee, Pradumna B. Rana,and Yoshihiro Iwasaki, April 1986

No. 31 Economic Analysis of the Environmental

Impacts of Development Projects John A. Dixon et al., EAPI,

East-West Center, August 1986No. 32 Science and Technology for Development:

Role of the BankKedar N. Kohli and Ifzal Ali, November 1986

No. 33 Satellite Remote Sensing in the Asian

and Pacific RegionMohan Sundara Rajan, December 1986No. 34 Changes in the Export Patterns of Asian and

Pacific Developing Countries: An EmpiricalOverview

Pradumna B. Rana, January 1987No. 35 Agricultural Price Policy in Nepal

Gerald C. Nelson, March 1987No. 36 Implications of Falling Primary Commodity

Prices for Agricultural Strategy in the Philippines Ifzal Ali, September 1987

No. 37 Determining Irrigation Charges: A Framework Prabhakar B. Ghate, October 1987

No. 38 The Role of Fertilizer Subsidies in Agricultural

Production: A Review of Select Issues M.G. Quibria, October 1987

No. 39 Domestic Adjustment to External Shocks

in Developing Asia Jungsoo Lee, October 1987

No. 40 Improving Domestic Resource Mobilization

through Financial Development: Indonesia Philip Erquiaga, November 1987

No. 41 Recent Trends and Issues on Foreign DirectInvestment in Asian and Pacific Developing

CountriesP.B. Rana, March 1988

No. 42 Manufactured Exports from the Philippines:

A Sector Profile and an Agenda for Reform I. Ali, September 1988

No. 43 A Framework for Evaluating the Economic

Benefits of Power Projects I. Ali, August 1989

No. 44 Promotion of Manufactured Exports in Pakistan

Jungsoo Lee and Yoshihiro Iwasaki,

September 1989No. 45 Education and Labor Markets in Indonesia:A Sector SurveyErnesto M. Pernia and David N. Wilson,

September 1989No. 46 Industrial Technology Capabilities

and Policies in Selected ADCs

Hiroshi Kakazu, June 1990No. 47 Designing Strategies and Policies

for Managing Structural Change in Asia Ifzal Ali, June 1990

No. 48 The Completion of the Single European Commu-nity

Market in 1992: A Tentative Assessment of its

Impact on Asian Developing Countries J.P. Verbiest and Min Tang, June 1991

No. 49 Economic Analysis of Investment in Power

Systems

Ifzal Ali, June 1991No. 50 External Finance and the Role of MultilateralFinancial Institutions in South Asia:Changing Patterns, Prospects, and Challenges Jungsoo Lee, November 1991

No. 51 The Gender and Poverty Nexus: Issues andPolicies M.G. Quibria, November 1993

No. 52 The Role of the State in Economic Development:Theory, the East Asian Experience,and the Malaysian Case

Jason Brown, December 1993No. 53 The Economic Benefits of Potable Water Supply

Projects to Households in Developing Countries

Dale Whittington and Venkateswarlu Swarna, January 1994

No. 54 Growth Triangles: Conceptual Issues

and Operational ProblemsMin Tang and Myo Thant, February 1994

No. 55 The Emerging Global Trading Environment

and Developing Asia Arvind Panagariya, M.G. Quibria,

and Narhari Rao, July 1996No. 56 Aspects of Urban Water and Sanitation in

the Context of Rapid Urbanization inDeveloping Asia

Ernesto M. Pernia and Stella LF. Alabastro,September 1997

No. 57 Challenges for Asias Trade and Environment

Douglas H. Brooks, January 1998No. 58 Economic Analysis of Health Sector Projects-

A Review of Issues, Methods, and Approaches

Ramesh Adhikari, Paul Gertler, andAnneli Lagman, March 1999

No. 59 The Asian Crisis: An Alternate ViewRajiv Kumar and Bibek Debroy, July 1999

No. 60 Social Consequences of the Financial Crisis inAsia

James C. Knowles, Ernesto M. Pernia, and Mary Racelis, November 1999


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17

No. 10 Some Aspects of Land Administration

in Indonesia: Implications for Bank OperationsSutanu Behuria, July 1994

No. 11 Demographic and Socioeconomic Determinants

of Contraceptive Use among Urban Women inthe Melanesian Countries in the South Pacific:

A Case Study of Port Vila Town in Vanuatu

T.K. Jayaraman, February 1995No. 12 Managing Development through

Institution Building

Hilton L. Root, October 1995

No. 13 Growth, Structural Change, and OptimalPoverty Interventions

Shiladitya Chatterjee, November 1995No. 14 Private Investment and Macroeconomic

Environment in the South Pacific Island

Countries: A Cross-Country AnalysisT.K. Jayaraman, October 1996

No. 15 The Rural-Urban Transition in Viet Nam:

Some Selected Issues

Sudipto Mundle and Brian Van Arkadie,October 1997

No. 16 A New Approach to Setting the FutureTransport Agenda

Roger Allport, Geoff Key, and Charles MelhuishJune 1998

No. 17 Adjustment and Distribution:

The Indian Experience

Sudipto Mundle and V.B. Tulasidhar, June 1998No. 18 Tax Reforms in Viet Nam: A Selective Analysis

Sudipto Mundle, December 1998No. 19 Surges and Volatility of Private Capital Flows to

Asian Developing Countries: Implicationsfor Multilateral Development Banks

Pradumna B. Rana, December 1998

No. 20 The Millennium Round and the Asian Economies: An Introduction

Dilip K. Das, October 1999No. 21 Occupational Segregation and the Gender

Earnings Gap

Joseph E. Zveglich, Jr. and Yana van der Meulen Rodgers, December 1999

No. 22 Information Technology: Next Locomotive of

Growth?

Dilip K. Das, June 2000

No. 1 Estimates of the Total External Debt ofthe Developing Member Countries of ADB:1981-1983

I.P. David, September 1984No. 2 Multivariate Statistical and Graphical

Classification Techniques Applied

to the Problem of Grouping Countries I.P. David and D.S. Maligalig, March 1985

No. 3 Gross National Product (GNP) Measurement

Issues in South Pacific Developing MemberCountries of ADBS.G. Tiwari, September 1985

No. 4 Estimates of Comparable Savings in Selected

DMCs Hananto Sigit, December 1985No. 5 Keeping Sample Survey Design

and Analysis Simple I.P. David, December 1985

No. 6 External Debt Situation in AsianDeveloping Countries I.P. David and Jungsoo Lee, March 1986

No. 7 Study of GNP Measurement Issues in theSouth Pacific Developing Member Countries.Part I: Existing National Accounts

of SPDMCsAnalysis of Methodologyand Application of SNA ConceptsP. Hodgkinson, October 1986

No. 8 Study of GNP Measurement Issues in the SouthPacific Developing Member Countries.Part II: Factors Affecting Intercountry

Comparability of Per Capita GNPP. Hodgkinson, October 1986No. 9 Survey of the External Debt Situation

in Asian Developing Countries, 1985

Jungsoo Lee and I.P. David, April 1987No. 10 A Survey of the External Debt Situation

in Asian Developing Countries, 1986

Jungsoo Lee and I.P. David, April 1988No. 11 Changing Pattern of Financial Flows to Asian

and Pacific Developing Countries

Jungsoo Lee and I.P. David, March 1989No. 12 The State of Agricultural Statistics in

Southeast Asia

I.P. David, March 1989No. 13 A Survey of the External Debt Situation

in Asian and Pacific Developing Countries:

1987-1988

Jungsoo Lee and I.P. David, July 1989No. 14 A Survey of the External Debt Situation in Asian and Pacific Developing Countries: 1988-1989 Jungsoo Lee, May 1990

No. 15 A Survey of the External Debt Situation

in Asian and Pacific Developing Countries: 1989-1992Min Tang, June 1991

No. 16 Recent Trends and Prospects of External DebtSituation and Financial Flows to Asianand Pacific Developing Countries

Min Tang and Aludia Pardo, June 1992No. 17 Purchasing Power Parity in Asian Developing

Countries: A Co-Integration Test

Min Tang and Ronald Q. Butiong, April 1994No. 18 Capital Flows to Asian and Pacific Developing

Countries: Recent Trends and Future Prospects

Min Tang and James Villafuerte, October 1995

STATISTICAL REPORT SERIES (SR)


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Edited by S.Ghon Rhee & Yutaka Shimomoto, 1999$35.00 (paperback)

9. Corporate Governance and Finance in East Asia:

A Study of Indonesia, Republic of Korea, Malaysia,Philippines and Thailand

J. Zhuang, David Edwards, D. Webb,& Ma. Virginita Capulong

Vol. 1, 2000 $10.00 (paperback)Vol. 2, 2001 $15.00 (paperback)

10. Financial Management and Governance IssuesAsian Development Bank, 2000Cambodia $10.00 (paperback)Peoples Republic of China $10.00 (paperback)Mongolia $10.00 (paperback)Pakistan $10.00 (paperback)Papua New Guinea $10.00 (paperback)Uzbekistan $10.00 (paperback)

Viet Nam $10.00 (paperback)Selected Developing Member Countries $10.00 (paperback)

11. Guidelines for the Economic Analysis of Projects

Asian Development Bank, 1997$10.00 (paperback)

12. Handbook for the Economic Analysis of Water SupplyProjects

Asian Development Bank, 1999$15.00 (hardbound)

13. Handbook for the Economic Analysis of Health SectorProjects


1. Rural Poverty in Developing AsiaEdited by M.G. QuibriaVol. 1: Bangladesh, India, and Sri Lanka, 1994$35.00 (paperback)

Vol. 2: Indonesia, Republic of Korea, Philippines,and Thailand, 1996$35.00 (paperback)

2. External Shocks and Policy Adjustments:Lessons from the Gulf Crisis

Edited by Naved Hamid and Shahid N. Zahid, 1995$15.00 (paperback)

3. Gender Indicators of Developing Asian

and Pacific Countries


4. Urban Poverty in Asia: A Survey of Critical Issues

Edited by Ernesto Pernia, 1994

$20.00 (paperback)5. Indonesia-Malaysia-Thailand Growth Triangle:

Theory to Practice

Edited by Myo Thant and Min Tang, 1996$15.00 (paperback)

6. Emerging Asia: Changes and Challenges Asian Development Bank, 1997$30.00 (paperback)

7. Asian Exports

Edited by Dilip Das, 1999$35.00 (paperback)$55.00 (hardbound)

8. Mortgage-Backed Securities Markets in Asia

SPECIAL STUDIES, ADB (SS, ADB)

(Published in-house; Available commercially through ADB Office of External Relations)

1. Improving Domestic Resource Mobilization ThroughFinancial Development: Overview September 1985

2. Improving Domestic Resource Mobilization Through

Financial Development: Bangladesh July 19863. Improving Domestic Resource Mobilization Through

Financial Development: Sri Lanka April 19874. Improving Domestic Resource Mobilization Through

Financial Development: India December 19875. Financing Public Sector Development Expenditurein Selected Countries: Overview January 1988

6. Study of Selected Industries: A Brief Report

April 19887. Financing Public Sector Development Expenditure

in Selected Countries: Bangladesh June 19888. Financing Public Sector Development Expenditure

in Selected Countries: India June 19889. Financing Public Sector Development Expenditure

in Selected Countries: Indonesia June 198810. Financing Public Sector Development Expenditure

in Selected Countries: Nepal June 198811. Financing Public Sector Development Expenditure

in Selected Countries: Pakistan June 198812. Financing Public Sector Development Expenditure

in Selected Countries: Philippines June 1988

13. Financing Public Sector Development Expenditurein Selected Countries: Thailand June 1988

14. Towards Regional Cooperation in South Asia:

ADB/EWC Symposium on Regional Cooperationin South Asia February 1988

15. Evaluating Rice Market Intervention Policies:Some Asian Examples April 1988

16. Improving Domestic Resource Mobilization ThroughFinancial Development: Nepal November 1988

17. Foreign Trade Barriers and Export Growth

September 198818. The Role of Small and Medium-Scale Industries in the

Industrial Development of the Philippines

April 198919. The Role of Small and Medium-Scale Manufacturing

Industries in Industrial Development: The Experience

of Selected Asian Countries

January 199020. National Accounts of Vanuatu, 1983-1987 January 1990

21. National Accounts of Western Samoa, 1984-1986

February 199022. Human Resource Policy and Economic

Development: Selected Country Studies

July 199023. Export Finance: Some Asian Examples

September 199024. National Accounts of the Cook Islands, 1982-1986

September 199025. Framework for the Economic and Financial Appraisal

of Urban Development Sector Projects January 199426. Framework and Criteria for the Appraisal

and Socioeconomic Justification of Education Projects

January 1994

27. Guidelines for the Economic Analysis of Projects February 1997

28. Investing in Asia

199729. Guidelines for the Economic Analysis

of Telecommunication Projects

199830. Guidelines for the Economic Analysis

of Water Supply Projects

1999

SPECIAL STUDIES, COMPLIMENTARY (SSC)



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1. Informal Finance: Some Findings from Asia

Prabhu Ghate et. al., 1992$15.00 (paperback)

2. Mongolia: A Centrally Planned Economyin Transition


3. Rural Poverty in Asia, Priority Issues and PolicyOptions

Edited by M.G. Quibria, 1994$25.00 (paperback)

4. Growth Triangles in Asia: A New Approach

to Regional Economic Cooperation

Edited by Myo Thant, Min Tang, and Hiroshi Kakazu1st ed., 1994 $36.00 (hardbound)Revised ed., 1998 $55.00 (hardbound)

5. Urban Poverty in Asia: A Survey of Critical Issues

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6. Critical Issues in Asian Development:Theories, Experiences, and Policies

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7. From Centrally Planned to Market Economies:

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Edited by Pradumna B. Rana and Naved Hamid, 1995Vol. 1: Overview

$36.00 (hardbound) Vol. 2: Peoples Republic of China and Mongolia

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9. Financial Sector Development in Asia: Country Studies

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10. Fiscal Management and Economic Reform

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Christine P.W. Wong, Christopher Heady,and Wing T. Woo, 1995$15.00 (paperback)

11. Current Issues in Economic Development:An Asian Perspective

Edited by M.G. Quibria and J. Malcolm Dowling, 1996$50.00 (hardbound)

12. The Bangladesh Economy in Transition

Edited by M.G. Quibria, 1997$20.00 (hardbound)

13. The Global Trading System and Developing Asia

Edited by Arvind Panagariya, M.G. Quibria,and Narhari Rao, 1997$55.00 (hardbound)

14. Rising to the Challenge in Asia: A Study of Financial

Markets

Asian Development Bank, 1999Vol. 1 $20.00 (paperback)Vol. 2 $15.00 (paperback)Vol. 3 $25.00 (paperback)Vols. 4-12 $20.00 (paperback)

SPECIAL STUDIES, OUP (SS,OUP)

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SERIALS

(Co-published with Oxford University Press; Available commercially through Oxford University PressOffices, Associated Companies, and Agents)

1. Asian Development Outlook (ADO; annual)

$36.00 (paperback)

2. Key Indicators of Developing Asian and Pacific Countries (KI; annual)

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JOURNAL

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1. Asian Development Review (ADR; semiannual)

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