To prevent the spread of COVID-19, many governments have imposed lockdowns. This practice has resulted in economic stagnation across broad areas because of the shock of the lockdown propagated to other regions through supply chains. Using supply-chain data for 1.6 million firms in Japan, this study examines how the economic effects of lockdowns in multiple regions interact with each other. Our major findings are twofold. First, when multiple regions coordinate the timing of their lockdowns, their economic losses are smaller than when they do so asynchronously. Second, the benefit of synchronous lockdown in multiple regions is larger when they are connected through a larger number of supply-chain links. Our results suggest a need for policy coordination across regions and countries when lockdowns are imposed.

Abstract

Utilizing a randomized controlled trial (RCT) in traditional clusters of apparel and textile firms in Vietnam, this paper investigates peer effects on firm managers’ decisions to participate in seminars on export promotion. We invited 131 randomly selected firm representatives to three one-day seminars on export promotion. We use the number of randomly invited peers to identify peer effects. We further decompose the invited peers into peers invited to the same seminar, those invited to the earlier seminars, and those invited to the later seminars. We find that the former has a positive effect on firms' participation, whereas the latter two have no significant effect. These results imply that peer effects on participation primarily arise from the benefits of face-to-face interactions. The presence of positive peer effects suggests that multiple equilibria in terms of the share of participants within each village of firms may emerge, which is also consistent with our observations.

To prevent the spread of COVID-19, many cities, states, and countries have 'locked down', restricting economic activities in non-essential sectors. Such lockdowns have substantially shrunk production in most countries. This study examines how the economic effects of lockdowns in different regions interact through supply chains, which are a network of firms for production, by simulating an agent-based model of production using supply-chain data for 1.6 million firms in Japan. We further investigate how the complex network structure affects the interactions between lockdown regions, emphasising the role of upstreamness and loops by decomposing supply-chain flows into potential and circular flow components. We find that a region's upstreamness, intensity of loops, and supplier substitutability in supply chains with other regions largely determine the economic effect of the lockdown in the region. In particular, when a region lifts its lockdown, its economic recovery substantially varies depending on whether it lifts the lockdown alone or together with another region closely linked through supply chains. These results indicate that the economic effect produced by exogenous shocks in a region can affect other regions and therefore this study proposes the need for inter-region policy coordination to reduce economic loss due to lockdowns.

Diversifying supply chains has been a policy objective of the Japanese government to construct a robust and resilient economy since the spread of COVID-19 in the final stages of the Abe Administration. Although geographically expanded supply chains incur a risk of inflows of negative economic shocks from other regions and countries, this risk can be alleviated by more diversification. In addition, diversified supply chains are found to promote the performance of firms. Recently, the domestic supply chains of Japanese firms started to be diversified, but firms still agglomerate in Tokyo substantially. Moreover, the international supply chains of Japanese firms rely considerably on Chinese suppliers and clients. Therefore, more geographic diversification of supply chains of Japanese firms is suggested for the more robust, resilient, and high-growth economy in the post Abenomics period, including diversifying within Japan, reducing the reliance on China, and strengthening links with developed countries, with the help of the government.

By conducting a laboratory experiment, we investigate how consumers’ purchasing behavior for certified forest coffee is affected by consumers’ interest in environmental issues, the provision of information, and product labels. We contribute to the literature in the following three ways. First, we conduct a randomized controlled trial (RCT) to control biases due to endogeneity. Second, we utilize eye-trackers to examine how different product labels result in different visual attention. The combination of an RCT and eye-tracking techniques is new in the literature on purchasing behavior for environmentally friendly products. Third, our experiment measures participants’ purchasing behavior that incurs actual costs rather than examining their willingness-to-pay (WTP) based on hypothetical questions. We find that concerns regarding environmental issues do not promote purchases of certified forest coffee. Information about certification programs does not have any effect on purchasing certified forest coffee unless information is provided to prior purchasers of certified forest coffee. By contrast, illustrations of forests on certified forest coffee labels attract participants’ visual attention and further stimulate actual purchases of certified forest coffee, suggesting that a 1-second increase in visual attention increases the likelihood of purchasing certified forest coffee by 22 percentage points.

Agrarian communities in different regions develop diverse coping strategies to address the environmental changes they face. In this work, we test how to stimulate farmers’ social learning across diverse regions to promote informed responses to soil degradation. We invited 117 randomly selected members of 16 randomly selected Sumatran communities to three 3-day networking and training events in regions with diverse socio-environmental histories. One event was held in the respondents’ remote rural district (Tanggamus), the second was held in a more densely populated region on Sumatra Island (Kalianda), and the third was held in a heavily populated region on Java Island (Garut and Ciamis). Eighteen months later, we surveyed the information-sharing networks and agricultural practices of 370 members of these communities. The participants had become popular sources of agricultural advice, but the strength of this impact depended on the region in which their networking intervention was conducted. The participants in the event on Java had become the most central members of their communities. Although all the participants received the same formal information, those who interacted with the farmers in a region with the longest history of population pressure and land degradation management were more likely to adopt the recommended practices. The participants in this intervention doubled their odds of adopting organic fertilizers compared with those who networked only with peers in their local environment. Environmental memory of coping with change can be shared between regions through social learning, which can be stimulated by simple interventions.

Organizations create networks with one another, and these networks may in turn shape the organizations involved. Until recently, such complex dynamic processes could not be rigorously empirically analyzed because of a lack of suitable modeling and validation methods. Using stochastic actor-oriented models and unique longitudinal survey data on the changing structure of interfirm production networks in the automotive industry in Japan, this paper illustrates how to quantitatively assess and validate (1) the dynamic micro-mechanism by which organizations form their networks and (2) the role of the dynamic network structures in organizational performance. The applied model helps to explain the endogenous processes behind the recent diversification of Japanese automobile production networks. Specifically, testing the effects of network topology and network diffusion on organizational performance, the novel modeling framework enables us to discern that the restructuring of interorganizational networks led to the increase of Japanese automakers’ production per employee, and not the reverse. Traditional models that do not allow for interaction between interorganizational structure and organizational agency misrepresent this mechanism.

Using a unique firm-level dataset for the manufacturing sector in Indonesia, we examine how firms' political connections affect their access to finance and performance. We determine individual firm's political connections by identifying whether the government owns shares in the firm, whether politicians are on its board of directors, and whether highly-ranked managers personally know any politician. Although several studies have examined effects of political connections on firms financing and performance, we contribute to the literature by distinguishing between large firms and small and medium enterprises (SMEs), between the loan approval and amount setting processes, and between formal and informal political connections. We find that politically connected firms are more likely to be able to borrow from state-owned banks. Moreover, being connected to the government raises the probability that a firm can receive the full loan amount it applied for. The improvement in access to finance from political connections is more prominent for SMEs than for large firms. Furthermore, such improvement mostly comes from personal connections with politicians rather than more formal connections measured by the government ownership or politicians on the board of directors. Finally, we examine the effect of political connected lending on allocative efficiency of capital and find weak evidence that scarce financial resources are likely channeled by state-owned banks to politically connected but less productive firms. (C) 2017 Elsevier Inc. All rights reserved.

Using both firm-level and city-level data from the Chinese National Bureau of Statistics and unique information on investment promotion agencies (IPA) in China, the present paper evaluates whether IPA affect foreign direct investment (FDI) from the perspective of both intensive and extensive margins; that is, re-investment by incumbent foreign-owned firms and total new FDI inflows into the city, respectively. After controlling for potential determinants of FDI and correcting for biases due to endogeneity, we find that, in general, IPA do not necessarily increase FDI in either case. However, IPA are found to promote re-investment by large foreign-owned firms. The results imply difficulty in the dissemination of information about the business environment to foreign investors.

Shade coffee certification programs that aim to conserve the forest and to prevent forest degradation have attracted an increasing amount of attention. However, such programs' impact on forest degradation remains unclear because of the absence of empirical evidence. In addition, there is heated debate about whether certification programs create an incentive for producers to expand their coffee-growing areas, which may accelerate forest degradation in the surrounding natural forest. This study, which was conducted in Ethiopia, aimed to evaluate the impact of a shade coffee certification program on forest degradation. Additionally, to provide empirical evidence for the debate, we examined the spillover effects of certification to surrounding forest areas and used remote sensing data of 2005 and 2010 to classify forest areas based on their density. We applied matching methods, such as the propensity score matching with different algorithms, to compare forest coffee areas with and without the certification. We found that the certified forest coffee areas slightly increased in forest density. By contrast, we observed drastic forest degradation in the forest coffee areas without certification. We checked the sensitivity of our results and found that our results are robust to potential hidden bias. Furthermore, our empirical results revealed that the natural forest areas within a 100-m radius from the forest coffee boundary area exhibited significantly reduced forest degradation compared with forest areas under similar environmental conditions but that such positive and significant impact diminished after 100-m distance. These results indicate that the certification program is effective in alleviating forest degradation in the certified area and in the surrounding natural forest. (C) 2016 The Author(s). Published by Elsevier Ltd.

Using a large firm-level panel dataset for Japan, this paper examines the effects of the structure of supply chain networks on productivity and innovation capability through knowledge diffusion. We find that ties with distant suppliers improve productivity (as measured by sales per worker) more than ties with neighboring suppliers, which is likely because distant firms' intermediates embody more diversified knowledge than those from neighboring firms. Ties with neighboring clients improve productivity more than ties with distant clients, which is likely because neighboring clients more effectively diffuse disembodied knowledge than distant clients. By contrast, ties with distant suppliers and clients improve innovative capability (as measured by the number of registered patents), whereas ties with neighboring suppliers or clients do not affect innovative capability. In addition, the density of a firm's ego network (as measured by how densely its supply chain partners transact with one another) has a negative effect on productivity and innovative capability, implying knowledge redundancy in dense networks. These results suggest that access to diversified ties is important for improving productivity and innovation capability through knowledge diffusion. (C) 2016 The Author(s). Published by Elsevier B.V.

The dynamic drivers of interfirm interactions across space have rarely been explored in the context of disaster recovery
therefore, the mechanism through which shocks propagate is unclear. This paper uses stochastic actor-oriented modeling to examine how trade networks among the 500 largest Japanese companies evolved during 2010 and 2011, i.e. before and after the Great East Japan Earthquake to identify sources of vulnerability in the system. In contrast to previous reports on broken supply chains, the network displayed only modest change even in the directly affected areas. Controlling for distance and for firm size, we find that when firms changed their partners, they preferred firms that were popular among other firms, that had partners in common with them and that also bought some products or services from them. These findings concur with a criticism that Japanese firms avoid external actors and exhibit inflexibility in reorganizing their networks in times of need, which contrasts with the non-cliquish network structures observed in high-performing economic sectors. The results also highlight the role of energy firms in disaster resilience. Unlike other large Japanese companies that cluster in major urban centers, energy firms are distributed across Japan. However, despite their peripheral physical locations, energy firms are centrally located in trade networks. Thus, while a disaster in any region may affect some energy firms and lead to large-scale temporary shocks, the entire network is unlikely to be disconnected by any region-specific disaster because of the spatial distribution of the topological network core formed by energy companies.

Limited access to agricultural information constrains the well-being of farmers in developing countries and leads to environmental deterioration. Although new information-communication technologies (ICTs) are expected to alleviate this problem, the importance of physical mobility is rarely considered. This study explores the roles of motorized transport and mobile phones in the diffusion of agricultural information within and between Indonesian farming communities. In 2012, we surveyed 315 household heads from 16 coffee and cocoa farming groups in Sumatra. The respondents identified 1575 sources from which they obtained agricultural information, the exact location of the sources, and the mode of contact. In 2013, we followed up with in-depth interviews of 20 farmers to obtain a qualitative description of their agricultural information-seeking behavior. Although 75 % of respondents had a mobile phone, the main mode of information sharing was face-to-face meetings for 97 % of the elicited relationships. Mobile phones were used to communicate with people living at the edge of the regular physical mobility radius enabled by motorbikes (approximately 10 km). A hierarchical logit model was applied to examine the implications of the respondents' tendency to use motorized transport vis-A -vis walking for information gathering. Respondents with a higher general preference for faster transport tended to have more extensive access to information from other communities. However, we also find weak evidence that individual motorized transport might decrease internal social contact and information exchange inside these communities. The policy implication for rural development in less-industrialized countries is that providing ICTs without increasing the inhabitants' mobility through appropriate means may not significantly improve the inhabitants' access to important information and the diffusion of successful agricultural practices.

This paper uses firm-level data to examine how supply chain networks affected the recovery of firms from the Great East Japan Earthquake. Extensive supply chains can negatively affect recovery through higher vulnerability to network disruption and positively through support from trading partners, easier search for new partners, and general benefits of agglomeration. Our results indicate that networks with firms outside of the impacted area contributed to the earlier resumption of production, whereas networks within the region contributed to sales recovery in the medium term. The results suggest that the positive effects of supply chains typically exceed the negative effects.

The importance of networks for social-ecological processes has been recognized in the literature; however, existing studies have not sufficiently addressed the dynamic nature of networks. Using data on the social learning networks of 265 farmers in Ethiopia for 2011 and 2012 and stochastic actor-oriented modeling, we explain the mechanisms of network evolution and soil conservation. The farmers' preferences for information exchange within the same social groups support the creation of interactive, clustered, nonhierarchical structures within the evolving learning networks, which contributed to the diffusion of the practice of composting. The introduced methods can be applied to determine whether and how social networks can be used to facilitate environmental interventions in various contexts.

This study empirically examined the effects of the participatory approach on the adoption of new crop varieties and agricultural practices. Particularly, we focused on the social network structure and examined how the introduced technologies diffused through networks in rural Ethiopia. Our empirical results indicate that if farmers knew and trusted fellow participants, the probability of adopting a new maize variety increased by 25 percentage points. However, this network had no statistical impact on the diffusion of new agricultural practices. We conclude that the participatory approach has great potential in the adoption of new crop varieties through the social networks of farmers in Ethiopia.

This paper examines whether privatizing Chinese state-owned enterprises increases the probability of exporting and, if so, what factors generate such an effect. Using firm-level data for the Chinese manufacturing sector for the 2000-2007 period, we find that privatization positively affects a firm's productivity, size, and decision to export, whereas we find that it negatively affects the level of a firm's long-term debt. We also find that Chinese firms are more likely to export when the productivity level, firm size, or the level of long-term debt increases. Taken together, these two sets of results suggest that privatization positively affects the likelihood that a firm will export by improving productivity and increasing firm size, whereas it negatively affects such a likelihood by lowering the long-term debt level of the firm. However, a quantitative analysis reveals that the effects of privatization that occur through these three channels are only slight. Therefore, we conclude that the positive effect of privatization on the likelihood of exporting is mainly the result of unobservable factors that are most likely related to changes in attitude about the profits and risks associated with privatization.

Recent heterogeneous-firm models of international trade suggest that productivity determines whether firms engage in export activity and foreign direct investment. In practice, however, many productive firms are not internationalized, whereas many unproductive firms are, which suggests that there are factors other than productivity that influence firms' internationalization. This study uses a unique panel data set for Japanese small and medium enterprises (SMEs) to examine whether the personal characteristics of a firm's president are factors in firm internationalization. We find that SMEs with a risk-tolerant, forward-looking president are more likely to be internationalized. These effects are large in magnitude, as is the productivity effect, which provides a partial explanation as to why many productive firms are not internationalized. In addition, we find that productivity has an insignificant effect on firms exiting export markets, whereas presidential myopia increases the probability of exit. The evidence further suggests that a firm's initial export costs become sunk following its entry into export markets, which explains why many unproductive firms are internationalized. J. Japanese Int. Economies 34 (2014) 236-255. School of Political Science and Economics, Waseda University, 1-6-1 Nishi Waseda, Shinjuku-ku, Tokyo 169-8050, Japan; Institute of Developing Economies, 3-2-2 Wakaba, Mihama-ku, Chiba 261-8545, Japan; Graduate School for International Development and Cooperation, Hiroshima University, Japan. (C) 2014 Elsevier Inc. All rights reserved.

By using firm-level data on the Japanese manufacturing industry, we examine and compare the characteristics of internationalized Japanese firms, namely firms that engage in exports and/or foreign direct investment (FDI), with those from selected European countries. We find that the productivity of internationalized firms is higher than that of domestic firms, thus confirming the findings of previous studies on Japan and other countries. In addition, we show that the productivity differences between domestic firms, exporters, and FDI firms are substantially smaller in Japan than they are in European countries. This finding suggests that productivity differences alone cannot determine the export or FDI behavior of Japanese firms.

Using firm-level data for Japan, this chapter examines the determinants of export and foreign direct investment (FDI) decisions. We contribute to the literature by employing a mixed logit model to incorporate any unobserved firm heterogeneity and by paying special attention to the quantitative significance of the determinants. We find that although the effect of productivity on export and FDI decisions is positive and statistically significant, this effect is economically negligible. The quantitatively dominant determinants of the export and FDI decision are instead the prior status of firms in terms of internationalization and unobserved firm characteristics. This finding suggests that foreign market entry costs, which vary substantially in size across firms, play an important role in the export and FDI decision. Using a unique dataset for small and medium enterprises, we further show that such non-productivity factors of firm internationalization that are unobserved in standard firm-level data include the risk and time preferences and international experience of decision makers.

As countries develop, they restructure away from agriculture and urbanize. But structural transformation and urbanization patterns differ substantially, with some countries fostering migration out of agriculture into rural off farm activities and secondary towns, and others undergoing rapid agglomeration in mega cities. Using cross-country panel data for developing countries spanning 1980-2004, it is found that migration out of agriculture into the missing middle (rural nonfarm economy and secondary towns) yields more inclusive growth patterns and faster poverty reduction than agglomeration in mega cities. This suggests that patterns of urbanization deserve much more attention when striving for faster poverty reduction. (C) 2013 Elsevier Ltd. All rights reserved.

Chinese cross-border outbound mergers and acquisitions (M&As) have been expanding rapidly since the mid-2000s with target firms in developed countries. The primary motives for such M&As are expansion into new markets and sourcing of knowledge and strategic assets. This study is the first attempt to examine the effects of Chinese outbound M&As on firm performance by applying propensity score matching estimations to a large set of firm-level data. We find that the sales, productivity, and tangible as well as intangible assets of the acquiring firms increase substantially after M&A transactions, which suggest that Chinese firms on average achieve their intended goals of outbound M&As. Further, outbound M&As do not increase research and development (R&D) intensity, implying complementarity, rather than overlapping, between R&D activities of the acquiring and acquired firms. (C) 2014 Elsevier Inc. All rights reserved.

Mobile phones are spreading to remote areas of the globe, leading to the following question: "What is the potential of the new communication technologies for increasing individuals' access to information and the diffusion of attitudes and practices across rural areas of developing countries?" We have donated phones to 234 farmers selected by stratified random sampling in an agrarian region of Ethiopia and have tracked their main communication partners for six months. The panel data and qualitative interviews indicated that the phones were not typically used to expand the existing constrained social networks or to gain information from new sources but to call contacts who had been known personally and to individuals introduced through the experiment. Stochastic actor-based network models clarified that although agricultural information-seeking and casual calling are intertwined, the mechanisms underlying the evolution of instrumental and expressive communication networks are distinct. Acquaintances living beyond comfortable walking distances and individuals whom others call became preferred for information-seeking calls. Thus, mobile phones may accelerate information exchange within existing social networks and may support the creation of new information hubs that might facilitate more efficient information diffusion over long distances in the future. In contrast, the importance of geographical communities strongly prevails in casual phone conversations. Physically proximate community members who tend to be met frequently were preferred for sentiment-sharing calls. Preferential attachment was not evident for this type of communication. As a result, the network of these expressive calls was highly localized and fragmented, making it unlikely for personal feelings to diffuse across wide geographical areas through the new phone networks.

In recent years, shade coffee certification programs have attracted increasing attention from forest conservation and development organizations. The certification programs could be expected to promote forest conservation by providing a premium price to shade coffee producers. However, little is known about the significance of the conservation efforts generated by certification programs. In particular, the relationship between the impact of the certification and producer characteristics has yet to be examined. The purpose of this study, which was conducted in Ethiopia, was to examine the impact of a shade coffee certification program on forest conservation and its relationship with the socioeconomic characteristics of the producers. Remote sensing data of 2005 and 2010 was used to gauge the changes in forest area. Employing a probit model, we found that a forest coffee area being certified increased the probability of forest conservation by 193 percentage points relative to forest coffee areas lacking certification. We also found that although economically poor producers tended to engage in forest clearing, the forest coffee certification program had a significant impact on these producers. This result suggests that the certification program significantly affects the behaviors of economically poor producers and motivates these producers to conserve the forest. (C) 2013 Elsevier Inc. All rights reserved.

This article analyses roles of social and extension networks in adoption of resource-conserving practices among Ethiopian farmers. We gathered data from 297 randomly sampled households on their agricultural practices, social networks, access to the extension, and geographical location. After examining general determinants of practising resource-conserving agriculture, we employ a two-stage regression with full-maximum likelihood correction for selection bias to establish the roles of general social networks and external professionals in acceptance of conservation techniques. In accordance with previous research, probit regression in the first stage shows that the access to extension increases with farmers' wealth and the size of their personal networks, and decreases with the distance of their households from village centres. However, after accounting for this unequal access to extension, the second-stage linear regression shows that regardless of education, wealth or geographical location, those whose religion and ethnicity match with their agent, report learning more about conservation from extension sources. Furthermore, farmers who are socially well connected within the community tend to be less receptive to agents' recommendations regarding resource conservation. Dissemination policy of conservation agriculture should consider the ethnic and religious affinity between farmers and their extension agents. It also needs to pay more attention to socially and geographically isolated individuals.

In recent years, shade coffee certification programs have attracted increasing attention from conservation and development organizations. Certification programs offer an opportunity to link environmental and economic goals by providing a premium price to producers and thereby contributing to forest conservation. However, the significance of the conservation efforts of certification programs remains unclear because of a lack of empirical evidence. The purpose of this study was to examine the impact of a shade coffee certification program on forest conservation. The study was conducted in the Belete-Gera Regional Forest Priority Area in Ethiopia, and remote sensing data of 2005 and 2010 were used to gauge the change of forest area. Using propensity score matching estimation, we found that forests under the coffee certification program were less likely to be deforested than forests without forest coffee. By contrast, the difference in the degree of deforestation between forests with forest coffee but not under the certification program and forests with no forest coffee is statistically insignificant. These results suggest that the certification program has had a large effect on forest protection, decreasing the probability of deforestation by 1.7 percentage points. (C) 2013 Elsevier Ltd. All rights reserved.

A rather unique panel tracking more than 3,300 individuals from households in rural Kagera, Tanzania, during 1991/1994-2010 shows that about one out of two individuals/households who exited poverty did so by transitioning out of agriculture into the rural nonfarm economy or secondary towns. Only one out of seven exited poverty by migrating to the big cities, even though those moving to the city experienced on average faster consumption growth. Further analysis of a much larger cross-country panel of 51 developing countries cannot reject that rural diversification and secondary town development lead to more inclusive growth patterns than metropolitization. Indications are that this follows because more of the poor find their way to the rural nonfarm economy and secondary towns, than to distant cities. The development discourse would benefit from shifting beyond the rural-urban dichotomy and focusing more instead on how best to urbanize and develop its rural nonfarm economy and secondary towns.

While detailed data are available on people's travel behavior in industrialized countries, little is known about the spatial characteristics of activities of those living in vast infrastructure-poor areas in the developing world where walking is still the dominant form of transport. We have interviewed 297 randomly selected inhabitants of Tiyo District, Ethiopia, and by random name cues identified 4158 individuals who are a representative cross-section of everyone the informants knew and met. Consequently, we inquired about the distance to these individuals, frequency of contacting them, and the mode of contact. Half of the respondents' social contacts lived within 15-min walking distance and the interviewed inhabitants contacted 98% of all people that they knew only by walking and meeting face-to-face. After examining the determinants of the size, density, and geographical extent of the inhabitants' personal networks, we employed multilevel analysis to explore the relevance of physical and social distance as well as personal characteristics for frequency of interaction. We found that in addition to the strong impact of walking time (-), common organization membership (-), the same religious affiliation (+), kinship (+), and patience (-) also predict the frequency of meetings. From this we present comparisons of the variables' relative effects and conclude with practical implications. (C) 2013 Elsevier Ltd. All rights reserved.

This study estimates the effect of farmer field schools in rural Ethiopia on income from agriculture. The farmer field schools were established in association with participatory forest management associations for forest protection funded by Japanese aid. We employ a difference-in-differences propensity score matching approach to correct for possible biases due to selection of participants. We find that by participating in the farmer field schools, agricultural households increased their real income per worker by about 60-160 US dollars in two years on average, which is equivalent to, or even more than, the average income per worker before the project. We also find evidence that the large increase in income is due to the use of new agricultural practices, such as new varieties, taught and promoted in the farmer field schools. Copyright (c) 2011 John Wiley & Sons, Ltd.

Many African countries have adopted community-based forest management (CBFM) to prevent deforestation. However, empirical studies have not reached a consensus on the effectiveness of CBFM. The purpose of this study is to examine the impact of the establishment of participatory forest management associations in Ethiopia. We used remote sensing data to gauge the change in forest area and employed a two-stage least squares model to correct for possible biases. The results indicate that the forest area managed by forest associations declines more in the year of establishment than forest areas with no association. This finding suggests that villagers may engage in "last-minute" logging. However, 1 year after the establishment of the forest associations, the forest area of the associations increased substantially, most likely because the associations monitor illegal logging, enabling the regeneration of open areas within the registered forest area. On average, the forest area of the forest associations increased by 1.5 % in the first 2 years, whereas forest areas not managed as part of an association declined by 3.3 %. The cumulative impact over 2 years yields a net increase in the rate of change of 4.8 %. These results demonstrate that it is important to improve the monitoring of forest areas during the initial establishment of participatory forest management associations to maximize the effects of association establishment.

This study examines a specific channel of technology diffusion from multinational enterprises to domestic firms in less developed regions: research and development (R&D) activities of multinational enterprises in the host country. Using firm-level panel data from a Chinese science park, known as China's "SiliconValley," we find that the R&D stock of foreign-owned firms has a positive effect on the productivity of domestic firms in the same industry, while the capital stock of foreign firms has no such effect. These results suggest that foreign firms' knowledge spills over within industries through their R&D activities, but not through their production activities. In addition, we find no evidence of spillovers from domestic firms or firms from Hong Kong, Macao, or Taiwan, suggesting that the size of knowledge spillovers is larger when the technology gap between source and recipient firms is larger.

Using firm-level data for Japan, this paper examines the determinants of the export and foreign direct investment (FDI) decision. We contribute to the literature by employing a mixed logit model, i.e. a multinomial logit model with random intercepts and random coefficients, to incorporate any unobserved firm heterogeneity and by paying special attention to the quantitative significance of the determinants. We find that while the impact of productivity on the export and FDI decision is positive and statistically significant, it is economically negligible. The effect of firm size, credit constraints and information spillovers from experienced firms is also small in magnitude. A quantitatively dominant determinant of the export and FDI decision is instead the prior status of firms in terms of internationalisation. In addition, the use of the mixed logit model enables us to find a substantial role of unobserved firm characteristics in internationalisation of the firm. These findings suggest that entry costs to foreign markets, which substantially vary in size across firms, play an important role in the export and FDI decision. In addition, given that the negligible effect of productivity and the dominant effect of prior status appear to be more prominent in Japan than in some other countries, this study helps highlight the uniqueness of Japanese firms.

This study examines the effect of Japanese aid-funded technical assistance programs on the Indonesian foundry industry funded, applying difference-in-differences propensity score matching estimation to a unique firm-level dataset. The major finding is that the average effect of the aid programs on the change in the reject ratio is negative and significant, suggesting that these programs help local participant firms improve their technology. However, technical assistance programs provided by the local counterpart of aid after the completion of the aid programs do not seem to improve technology of participants in the short run on average. (C) 2010 Elsevier Ltd. All rights reserved.

The paper finds that placer gold mining operation has significant impact on the surface water quality, which varies from mine to mine depending on the types of gold recovery technologies applied. Only primitive gold recovery technologies are dominating in the Zaamar goldfield. We assume that the mines with foreign ownership have cleaner technologies with less impact on the water quality than the local ones. But results from the water quality measurement and surveys at the field show that mines with joint ownerships of Russian or Chinese companies in Zaamar area have more polluting technologies than the local smaller companies. © 2011 WIT Press.

This article explores the impact of offshoring on productivity using firm-level data for the Japanese manufacturing industries during the period 1994-2000. We find that intrafirm offshoring, that is, sourcing of intermediate inputs to foreign affiliates within a particular multinational firm, has generally a positive effect on productivity of the offshoring firm, while arm's-length offshoring, that is, sourcing to unaffiliated foreign firms, does not have such an effect. In addition, the impact of arm's-length offshoring is negative for nonmultinationals and nonexporters but nonnegative for multinationals and exporters. These results suggest that the costs of searching foreign firms suitable for offshoring are nonnegligible. (JEL F14, L23)

This paper investigates whether and how foreign aid facilitates foreign direct investment (FDI) flows into less developed countries. We employ a large data set of source-recipient country pairs and conduct gravity equation-type estimation. Our empirical methodology enables us to examine an effect through which aid from a donor country promotes FDI from the same donor in particular, which we call a "vanguard effect." We find that foreign aid in general does not have any significant effect on FDI. However, when we allow for differences in the size of aid effects across donor countries, we find robust evidence that foreign aid from Japan in particular has a vanguard effect, i.e., Japanese aid promotes FDI from Japan but does not attract FDI from other countries. (C) 2009 Elsevier Ltd. All rights reserved.

This paper employs a firm-level panel data set for a high-tech cluster in China to examine knowledge spillovers from multinational enterprises (MNEs) to domestic firms, focusing on the role of MNEs' employment of educated workers. We find that knowledge of MNEs spills over to domestic firms in the same industry through MNEs' employment of workers with graduate-level or overseas education. We also find that Japanese MNEs contribute less to knowledge spillovers than US MNEs. This is likely due to the fact that Japanese MNEs in China do not employ much educated labor. © 2009 Elsevier Inc. All rights reserved.

This paper investigates the causes of R&amp
D activities of overseas subsidiaries using firm-level panel data for Japanese multinationals. We distinguish between overseas innovative R&amp
D (basic and applied research) and adaptive R&amp
D (development and design) and examine how the intensity of each type of R&amp
D is determined, using Amemiya Generalized Least Squares estimation. Our findings suggest that overseas innovative R&amp
D aims at the exploitation of foreign knowledge, whereas adaptive R&amp
D has no such aim. In addition, the size of the host country's market positively affects both types, whereas geographic distance between the host and the home country has a negative impact. Finally, the parent firm's knowledge is found to increase the size of overseas adaptive R&amp
D but not innovative R&amp
D. Based on a theoretical model, we interpret this evidence as showing that knowledge of the parent firm is not fully utilized in innovative R&amp
D of its subsidiary. © 2008 Elsevier B.V. All rights reserved.

Using French data, we find that the share of immigrants in the population has no significant impact on crime rates once immigrants' economic circumstances are controlled for, while finding that unemployed immigrants tend to commit more crimes than unemployed nonimmigrants.

This paper investigates the impact of overseas subsidiaries' R&D activities on the productivity growth of parent firms Using firm-level data for Japanese multinational enterprises. Based oil Survey responses, we classify each overseas subsidiary's R&D as either 'innovative R&D,' which we hypothesize is likely to lead to the acquisition of foreign knowledge, or 'adaptive R&D,' which is more likely to lead to adaptation to local conditions. We find that overseas innovative R&D raises the parent firm's productivity growth, while adaptive R&D has no such effect. In addition, overseas innovative R&D does not improve the rate of return on home R&D.

This paper explores what factors determine the nature, extent, and location of Japanese multinationals' R&D activities abroad. Taking advantage of a rich micro-level dataset from the survey on Japanese overseas subsidiaries, the study distinguishes between two types of overseas R&D: basic/applied research and development/design. We find several differences between the determinants of those R&D activities. These differences confirm the view that basic/applied research of overseas subsidiaries aims at the exploitation of foreign advanced knowledge, whereas their development/design activities are mostly influenced by the market size of the host country. Our results provide a convincing and comprehensive explanation of the geographical distribution of overseas R&D by Japanese MNEs. (c) 2008 Elsevier B.V. All rights reserved.

This study uses firm-level panel data from the Japanese manufacturing industries and examines whether foreign direct investment generates intra-industry knowledge spillovers to domestic firms. The analysis found positive effects of R&amp
D stocks of foreign firms on the productivity of domestic firms, while effects of capital stocks of foreign firms were absent, suggesting that knowledge of foreign firms spills over through their R&amp
D activities, but not through their production activities. In addition, we found that the extent of spillovers from R&amp
D stock of foreign firms is substantially larger than spillovers from R&amp
D stock of domestic firms. © 2006 Elsevier Inc. All rights reserved.

Technology adoption in follower countries can be accomplished by local R&amp
D activities, but it can also be achieved without formal R&amp
D, for example, by foreign direct investment. Empirical evidence suggests that current R&amp
D activities often expand local knowledge for future R&amp
D, while adoption without R&amp
D does not seem to have this effect. We formalize this idea in a quality-ladder growth model and find that this biased externality results in multiple steady states: In the long run, countries with sufficient initial knowledge and human capital converge to a state in which R&amp
D is locally undertaken and thus become relatively rich, while other countries fully rely on technology adoption without R&amp
D and stay poor. Switching regression using cross-country data supports the presence of multiple steady states in R&amp
D expenditures. Copyright ©1999-2005 Internet-Journals, Inc. All rights reserved.

Scale effects in endogenous growth models have been questioned by the fact that a remarkable increase in the number of scientists and engineers engaged in R&D in the postwar United States was indeed associated with a productivity slowdown. This paper, however, shows that this evidence could be reconciled with scale effects, once technology diffusion from technologically leading countries to followers by foreign direct investment (FDI) is incorporated into a standard model. If FDI requires scientists and engineers of advanced countries to adapt existing technologies to the local environment and to train local workers, the number of scientists and engineers would increase as the magnitude of technology diffusion expands. Also, the emergence of FDI as more profitable opportunities for scientists and engineers could lead to a domestic productivity slowdown in advanced countries. (C) 2003 Elsevier Science Inc. All rights reserved.