Laos is one of Korea’s priority partner countries for official development assistance (ODA) where four sectors are mainly focused such as water management and health, energy, education, and rural development based on the country partnership strategy (CPS). As of 2015, total population rises to almost 7 million among which urban population is 38.6%, and rural population is 61.4%. Although the overall trend of urban population increases rapidly, rural sectors such as agriculture and forestry that utilize abundant natural resources of land, water, grass, tree, and mining are still dominating Lao people due to the high portion of primary industry resulted from land uses. Total land in Laos consists of 78.4% of forestry (18.6 million ha), 10% of the agricultural area (2,369 thousand ha) and others.
  This research studies Korea’s agricultural development cooperation with a focus on rural development that is one of the focal areas approved by Korea’s CPS with Laos. It starts from current agricultural development and future needs for Laos scheduled in particular by agricultural development strategy to 2025 and vision to the year 2030 (ADS 2025) approved by Ministry of Agriculture and Forestry (MAF) of Lao government in 2015. Agricultural programs in Laos supported by other countries or international organizations such as Japan, Australia, Germany, Swiss, Asia Development Bank (ADB), World Bank Group (WB), World Food Program (WFP), and Food and Agriculture Organization (FAO) are discussed in detail for finding possible cooperation each other at the same fields or drawing any significant implication for suggesting promising agricultural programs. On the other hand, Korea’s agricultural capacity is essential for implementing agricultural programs suitable to Laos so that current Korea’s agricultural programs of using both grant and loans are studied for better understanding of finding bottlenecks or challenges in Laos. Based on agricultural needs in Laos and Korea’s capacity in agricultural development cooperation, it suggests several agricultural programs.
  ADS 2025 indicates specific targets and programs in both food production and agricultural commodity production. The target rate for agricultural growth by 2020 is 3.4%, and the one for nutrition is 2,600 kcal/person/day. Agricultural food crops, livestock, and fishery are the main areas for its development. The 9 action plans in agricultural food crops production include 1) agricultural land development, 2) infrastructure development, 3) clean agriculture development, 4) production management, 5) plant protection and quarantine development, 6) food crops research, 7) commercial crop production, 8) plant variety and technical research for commercial cultivation and 9) personnel development for plant protection and quarantine. There are 7 action plans in livestock and fishery development such as 1) improvement of productivity in livestock and fishery production, 2) improvement and development on sanitary measures for animal products, 3) livestock and fishery production research, 4) livestock and fishery commodity production research, 5) livestock and fishery production extension, 6) livestock production, veterinary and fishery management and administration improvement, and 7) commercial livestock and fishery production promotion.
  Laos has received almost $500-650 million annually on average from international societies. Japan’s agricultural programs focus on enhancing agricultural policy and administration capacity, land management, water resources, food production, and livestock industry by inviting private sectors as well as local farmers. Australia has agricultural programs on developing livestock and agricultural technology as well as policy and administration. Germany focuses on rural development, climate change, forestation, and enhancing various natural species in agriculture. Swiss has provided to enhance agricultural extension services for 12 years aiming at enhancing agricultural productivity, especially for small farmers. ADB’s strategy indicates enhancing local/regional connectivity and irrigation, agricultural value chain, regional infrastructure, and water resource management for food security. WB has many agricultural programs including land management and forestry cooperation to reduce emissions from deforestation and forest degradation (REDD+). WFP has supported food assistance for enhancing children’s nutrition especially using school programs. FAO has helped Laos facilitate agricultural market and technology through agricultural education programs such as farmers’ field school (FFS).
  Korea as one of important donors in Laos has provided many projects such as technical assistance through Korea Program on International Agriculture (KOPIA) center of Rural Development Administration (RDA), integrated agriculture and rural development project through Economic Development Cooperation Fund (EDCF) supported by Korea Rural Community Cooperation (KRC), agricultural and rural activities through KOICA, consulting agricultural policies through Korean Agricultural Policy Experiences for Food Security (KAPEX) from Korea Rural Economic Institute (KREI) and Knowledge Sharing Program (KSP) from Korea Development Institute (KDI). These activities should be more aligned each other in the near future for increasing aid effectiveness in Laos.
  Korea has a great experience to enhance agricultural production and marketing system within a short period of time such as increasing agricultural technology especially in rice productivity for small farmers, livestock and milk industry, forestation, farm financing and marketing through agricultural cooperatives, information on agricultural price and markets, and so on.
  In conclusion, for future direction in agricultural development cooperation with Laos, sustaining agricultural policy framework, first of all, should be continued such as KAPEX and KSP in order to initiate pilot programs for implementing good agricultural policies in Laos for mutual recognition. There are potential areas such as enhancing food security, responding to the climate change for agricultural resilience, achieving sustainable development goals (SDGs). Second, facilitating and implementing agricultural policies in Laos should be supported by Korea government’s programs in areas such as technical assistance, capacity building, and agricultural value chain. Third, agricultural development programs should be linked with current frameworks such as Korea-Laos, Korea-Mekong, and Korea-ASEAN cooperation. Fourth, incorporating private sectors and/or non-government organizations (NGOs) throughout the programs are important for sustainable agricultural development activities in the long run. These programs should contribute to the social and economic growth for Laos to graduate from the least developed country by 2020 and transform into a middle-income country by 2030 led by National Socio-Economic Development Plan (NSEDP, 2016-2020). 

Preface

Contributors

Introduction and Overview
Lee-Jay Cho

Statements by Country Representatives

Part I. China’s Economic Development and Northeast Asia Regional Cooperation in the Context of the Road and Belt Initiative

Part II. Future Tourism Cooperation in Northeast Asia

Part III: Cross-border Infrastructure and Special Economic Zones in Northeast Asia

Part IV: Building a Northeast Asian Economic Community and Its Extended Regions

Part V: Financial Cooperation in Northeast Asia

Part VI: Energy and Environment in Northeast Asia

Appendix: Hong Kong Statement and Agenda 

  This year witnessed political tensions resulting from a series of provocative nuclear and missiles tests in North Korea and from domestic political unrest, culminating in the abrupt leadership change in the Republic of Korea. All these events pose enormous challenges for minimizing the risks of military confrontation and war in the Northeast Asian region. A significant dampening factor on these possibilities is the real progress made in recent decades in economic cooperation and integration within the region, which contributes to reducing military action in the Korean Peninsula. North Korea, however, still remains the critical gap in an otherwise productive network of dynamic regional economic growth.
  For Northeast Asia, there is a continuing and growing need for promoting peaceful economic interactions and research on a common basis for cross border economic cooperation for the future common good, as a means of ameliorating political tensions and frictions in the Korean Peninsula and Northeast Asia. Toward this end, the KIEP–NEAEF collaborative project seeks to fulfill the need for timely and forward-looking research activities by focusing on some of the critical components, such as strengthening economic cooperation with China and exploring future scenarios of North Korea as an integral part of broader regional economic cooperation in the region. This collaborative work on Northeast Asia remains essential in carrying out activities aimed at building a future Northeast Asian economic community on the basis of the strong network the NEAEF has built over the years for functional economic cooperation, through discussions and consultations among stakeholder country experts on issues such as cross border infrastructure development and financial cooperation.
  This volume in the series of proceedings volumes is titled Sustaining the Momentum for Building a Northeast Asian Economic Community and comprises summaries of research presentations and discussions on building a Northeast Asian economic community presented at the planning meeting in Honolulu and at the Annual Conference of the Northeast Asia Economic Forum in Hong Kong, China, in 2017. The results of this project represent activities that have been contributing to efforts toward regional economic cooperation and have been carried out in a spirit of cooperation.
  KIEP is grateful to Dr. Lee-Jay Cho, Chairman of NEAEF, for his leadership in implementing the project, and to the authors of the presentations, conference participants and discussants who contributed to this volume.
  Drs. Lee-Jay Cho and Hyung-Gon Jeong would like to extend their appreciation to the NEAEF staff for their assistance in the course of the successful implementation of this project, and to Drs. Karla Fallon and Kennon Breazeale for their editorial review and editing of this volume. 

  Recently, India’s inbound M&A transactions have been growing together with the boom in acquisitions of Indian domestic firms by multi-national corporations (MNCs). Various types of foreign investors such as conglomerates, SMEs (small-and medium-sized enterprises), VC (venture capital) and PE (private equity) entities are hurrying to enter the Indian market through M&As with Indian firms.
  This trend may have been influenced by positive changes in both the internal and external M&A environment surrounding India or in the global market. Regarding these changes, since 2014 the Indian government has been struggling to improve macroeconomic conditions (i.e. accelerating growth, reducing inflation and fiscal deficit) while focusing on various economic reforms, and through this to promote foreign investment for the sustainable growth of India. In particular, the Indian government has continued to introduce or revise M&A-related regulations, policies, and laws, thus improving fairness and transparency in India’s M&A market.
  With the newly rising wave of M&As and reforms in India, structural changes are taking place in India’s foreign direct investment. First, we found that the share of M&A to total FDI is expanding with faster growing than green field investment. This trend is becoming more pronounced for the last couple of years. Also, within the inbound M&A market, there are some significant changes: 1) M&A transactions are more active in technology-intensive and high value-added sectors such as IT- or digital-based, pharmaceutical, finance sectors, rather than labor-intensive sectors which used to dominate the M&A market in the past, 2) the number of vertical or heterogeneous combinations between MNCs and Indian firms is increasing compared to the past when horizontal combination dominated, thus diversifying combination types, which means MNCs recently tend to focus on enhancing their value chain, seeking new business, and expanding their market, 3) asset transactions and market participation by SMEs are growing, with the boom in ‘small deals’, and diversifying investor types such as VCs, PEs, etc. In addition, most importantly, the origin of foreign investors is diversifying. In recent, emerging and developing countries are actively acquiring Indian firms compared to the past when a few developed countries dominated the Indian M&A market, therefore reducing excessive dependance on specific regions or countries.
  Despite such significant changes, Korean firms still remain in a lagging position when it comes to using M&As as a channel for breaking into the Indian market. So far, since 2001, the total number of Indian firms acquired by Korean firms stands at eight, for a value of around 120 billion US dollars, which is only one-tenth of Japan. Furthermore, M&A investment growth is slower than ASEAN countries such as Thailand, Malaysia, and Philippines.
  In these circumstances, this research provides some implications for Korean firms and government, thereby enhancing opportunities of entering into Indian market. First, firms need to utilize M&A as a strategic tool, specially focusing on promising sectors. Second, firms need to enhance their internal capability for dealing with cross-border M&A transactions, and build partnerships with both domestic and Indian M&A agencies, increasing the number of deals completed. Last, the Korean government needs to organize an ‘oversea M&A support center’ for promoting Korean SMEs’ cross-border M&A. 

Executive Summary

1. Introduction

2. TPA and 2015-TPA Trade Negotiating Objectives

3. Data

4. Empirical Methodology and Results

5. Concluding Remarks

References

Appendix 

  This paper analyzes 2015-TPA voting patterns in the Congress in the context of the trade negotiating objectives. By setting the trade negotiating objectives, the Congress lays out important trade agenda that the Administration is ex-pected to address when it is negotiating trade deals with foreign countries. Therefore setting the objectives is subject of heated debates in the Congress and an important part of TPA. LPM and probit models are used to evaluate the importance of each trade negotiating objectives in 2015-TPA voting deci-sions. It turns out that the objective on promoting U.S. agricultural exports by reducing unfair trade barriers positively affected the voting decision in favor of the TPA. The objective on enforcing strong labor standards on trade partners also had significant impacts. One other notable result is that how much each congressional region export to China was also an important de-terminant. This variable is meant to capture several negotiating objectives as well as growing worries of large trade deficits with China. This study docu-ments important issues that U.S. Congress is concerned about in making conducting and implementing trade policies. It may provide insights into the future course of U.S. trade policy and trade deals such as renegotiation of NAFTA and Korea-US FTA.

Keywords: Trade Agreements, Trade Promotion Authority, Voting
JEL Classification Numbers: F10, D72
 

  Financial market integration has contributed to risk-sharing through portfolio diversification and has provided a positive effect on economic growth by supplying funds to countries that lack capital. At the same time, however, it has caused the negative spillovers of financial shocks through the integrated financial markets. A typical example is the 2008 global financial crisis. As the uncertainties in the global financial market increase significantly during the crisis period, financial variables (asset price, leverage, credit growth, capital flows, etc.) in developed and emerging economies are not controlled by their own monetary policies, but are more sensitive to global financial market sentiments. In the end, it has greatly restricted monetary policies in many countries. In this study, we investigate on how much monetary policies have been restricted by constructing a monetary policy independence index, and try to understand monetary policy independence by trilemma, which is a main implication from the Mundell-Fleming model.
  According to trilemma, a country cannot achieve three policy goals simultaneously, i.e., one policy goal must be abandoned to achieve two. The three policy goals are exchange rate stability, capital account openness, and monetary policy independence. If trilemma holds, monetary policy independence can be secured by abandoning the stable exchange rate through adoption of floating exchange rate system in the open capital market. In order to see whether such monetary policy independence is indeed consistent with what trilemma predicts, we constructed the trilemma Index using data from 2002 to 2013 that covers 45 countries including Korea. The trilemma indexes consist of monetary policy independence index, capital account openness index, and exchange rate stability index. short-term interest rate independence index, which reflects the tendency of short-term interest rate desynchronization, is constructed to evaluate monetary policy independence.
  The monetary policy independence means the autonomy of short- term policy rate decision in narrow definition, but broadly it means the capacity to pursue domestic policy goals. In order to evaluate various aspects of monetary policy independence in this paper, we use not only short-term policy rate used in the construction of the short-term interest rate independence index, but also the long-term interest rate that plays an important role in the monetary transmission mechanism. In the transmission mechanism, short-term policy rate decisions lead to changes in various interest rate variables, particularly long-term interest rates that in turn affect the economic performance such as investment and output. However, if the short-term policy rate does not affect long-term interest rate, the effect of monetary policy independence on the real sector is reduced. In order to take this possibility into consideration, we will construct a long-term interest rate independence index (LRI) reflecting the tendency to long-term interest rate desynchronization, and analyze the economic implications of this new index.
  The results of the analysis show that we have found trade-offs among three trilemma indexes and this supports that trilemma holds. However, when we consider for the long-term interest rate independence index instead of short-term interest rate independence index to evaluate the monetary policy independence broadly, it could be seen that not trilemma but, dilemma holds. This is particularly noticeable during periods when the correlation between the two indexes has weakened since the global financial crisis. Given the stylized fact we found that the long-term interest rate independence index is a very important explanatory variable in explaining the international business cycle especially after the global financial crisis, we need to closely monitor the long-term interest rate independence index.
  In the Block-Exogenous vector autoregression (VAR) model, we examine the impact of the US short-term interest rate shock on the short- and long-term interest rates in 10 emerging market economies. The empirical results show that there is a short-term interest rate synchronization, but no long-term interest rate synchronization before the global financial crisis. Since the global financial crisis, however, there is only long-term interest rate synchronization even without short-term interest rate synchronization. This is consistent with the results of the analysis using the long-term interest rate independence index. In the empirical result of the extended VAR analysis in which high and low capital account openness country group are separately considered, we found that the long-term interest rate synchronization is more pronounced in the country with high capital account openness, which implies that the capital control or the macroprudential policy can be useful policy measures to manage the long-term interest rate synchronization.
  In the case of Korea, capital account openness index increased significantly after the global financial crisis, while vulnerability remained high in terms of exchange rate stability index. Although the short-term interest rate independence index was highly evaluated, the long-term interest rate independence index fell sharply after the global financial crisis. The impact of the US short-term interest rate shocks on short- and long-term interest rates in Korea was similar to the impulse response function of the above 10 emerging market economies. It is necessary to pay attention to the results of empirical analysis using high and low capital account openness country group. This suggests a new perspective on the role of capital control or macrprudential policy measures in relation to monetary policy independence. These policy tools have been so far mainly discussed in the context of capital flow management, but our empirical results show that these policy tools can be also useful to secure monetary policy independence for emerging market economies. 

Executive Summary

1. Introduction
1.1 China-Africa Relations

2. Methodology and Data
2.1 Methodology
2.2 Data

3. Findings and Results
3.1 Scenarios for the MBRI in Africa

4. Summary and Conclusion

References

Appendix 

  Recent development economic literatures theorize that South-South trade and foreign investment may have a larger impact on economic growth in devel-oping economies than North-South trade and investment, since investors from the South are more familiar with local developing markets and business practices, which increases their productivity spillovers (Aykut and Goldstein 2007). Amighini and Sanfilippo (2014) provided evidence that South-South trade and investments stimulate product diversification in light manufacturing industries such as agro-processing, plastic, textile and leather production.
  The Belt and Road Initiative (BRI) launched in 2013, aims to create economic opportunities as well as improve and establish new trading routes between China and connected regions. This paper attempts to evaluate the degree of trade relations between China and selected African countries along the Mari-time Silk Route (MSR) and further appraise the trade potentials and gains in-herent for African economies through the initiative. To achieve our objective, we apply quantitative techniques in trade evaluation to enable us explore and estimate the degree and intensity of trade engagements amongst selected Si-no-African silk route countries, identify the trade opportunities and potentials, which are critical for increased trade engagements between both parties along the route and to explore some of the channels through which the maritime route can impact on investment, trade and economic growth in Africa.
  Findings from the analysis indicate that while the degree of trade integration is unbalanced and favourable to China relative to Africa, the trade pattern and structure are observed to be more complementary than competitive, and this provides Africa with ample opportunity to engage in product upgrading and diversification, critical for structural transformation.

Keywords: Maritime Silk Route, Belt and Road, Africa, Trade Complemen-tarity, Trade Competitiveness
JEL Classification: F15, F17, F18, 024 

  The recent rise of air pollution, represented by an increase in particulate matters, has grown into an important economic, social and diplomatic issue in Korea amidst growing concerns over a significant proportion of domestic air pollutants coming from neighboring countries. Transboundary air pollution, which causes adverse effects in areas under the jurisdiction of other countries, has become a serious matter that requires the joint response of surrounding countries, not the problem of an individual country. The objective of this study is to propose policy implications to cope with the rise of air pollution in Northeast Asia by analyzing policies and cases of international cooperation in the global society.
  Policies and regulatory measures introduced by major countries to improve air quality can be summarized as possessing the following characteristics. The European Union (EU), China and the United States (U.S.) have all established and supplemented domestic environmental laws, policies and regulations. In accordance with improved legal and institutional frameworks, they have being taking practical measures including setting national air quality standards, controlling air pollutant emissions and strengthening monitoring systems. As a result, they have achieved a certain level of air pollutant emission reductions, in particular improvements centered on pollutants for which emission ceilings or standards have been arranged. In the case of China, it has been strengthening its supervision authority, regulatory measures and management standards for severely polluted areas such as Jing-Jin-Ji (Beijing, Tianjin and Hebei province) since 2010. However, emission levels of PM10 and PM2.5 are still in need of improvement, as their annual means exceeded both national and international standards in 2016.
  At the international level, bilateral or multilateral cooperative regimes have been established with the aim of solving transboundary air pollution problems. In Europe, North America and Southeast Asia, official agreements concerning air pollution across countries have been concluded, together with the establishment of relevant organizations and monitoring systems under these agreements. The Convention on Long-Range Transboundary Air Pollution (CLRTAP) in Europe, the U.S.-Canada Air Quality Agreement (AQA) and the U.S.-Mexico La Paz Agreement in North America, as well as the ASEAN Agreement on Transboundary Haze Pollution (AATHP) in Southeast Asia, were all signed with the goal of establishing joint response mechanisms for preventing and reducing air pollution in their regions. Above all, these agreements provided important opportunities for member countries to seek solutions based on scientific evidence or data gathered through collaborative research projects, and to strengthen environmental cooperation. Since then, they have been adopting protocols, annexes, roadmaps and others for supplementing insufficient contents within these agreements or resolving new environmental matters.
  The CLRTAP, adopted in 1979, has established a multilateral cooperation mechanism in Europe with a total of 51 parties, and is recognized as the most successful case with the largest scale and longest history among the four agreements reviewed. The AATHP in Southeast Asia is an agreement concluded to solve haze pollution caused by fires originating mainly in Indonesia. Both regions share the characteristic that they have been able to effectively utilize their organizations and systems, i.e. the EU and ASEAN, in implementing the agreements. Meanwhile, the agreements in North America have focused on solving environmental pollution problems in the border areas, including acid rain, and have contributed to the development of U.S.-Canada and U.S.-Mexico bilateral cooperative relationships.
  Agreements between Southeast Asian countries on transboundary air pollution have mainly focused on presenting principles and guidelines for addressing haze pollution, as opposed to setting emission ceilings and regulatory standards for main pollutants, which were the focus of agreements in Europe and North America. Therefore, although the AATHP has achieved several accomplishments through cooperation, such as sharing data collection and enhancing joint monitoring systems on certain areas (mainly peatland) and periods (dry season, etc.) that are most affected by haze pollution, it still lacks legally binding measures to limit air pollutant emissions, unlike other agreements. However, the AATHP is meaningful in that it reflects the ASEAN principles regarding respect for national sovereignty and consensus; thus, one solution might be to induce all ASEAN members to take part in the AATHP.
  Taking into consideration the cooperative experiences of other regions as described above, our recommendation is to develop multilateral agreements aimed at addressing transboundary air pollution in Northeast Asia. The AATHP's approach in Southeast Asia and the approach of the CLRTAP in Europe encourage the idea that rather than placing regulations on air pollutant emissions, implementing a more realistic multilateral agreement to exchange information and strengthen air quality monitoring networks will induce Northeast Asian countries to participate. It is fundamentally necessary to establish regional environmental regimes for the areas or periods that are most affected by air pollution, and gradually intensify cooperation among member countries, including the adoption of further protocols or annexes in the agreement. It will also be advisable to refer to the AQA and include a clause suggesting that each country promptly notify neighboring countries in the event of policy action or projects that might cause considerable environmental damage, promote joint research to provide relevant scientific data, and ensure a periodic evaluation of progress in the implementation of the agreement.
  Based on the results of the above analysis, we suggest the following measures to reduce air pollution in Northeast Asia. First, we propose that Korea participate directly in the CLRTAP, which may encourage the participation of other Northeast Asian countries and provide the basis for multilateral cooperation in Northeast Asia in the future. Since the grace period for the value of the emission limit may be extended by up to 15 years, this will alleviate the burdens associated with emission regulations, at least in the short term. Under political conflicts like the Terminal High Altitude Area Defense (THAAD) dispute between South Korea and China, it may also be a realistic alternative to attempt to induce China to participate in a multilateral cooperation system under existing successful mechanisms such as the CLRTAP. Second, it is necessary to accumulate more objective data through consultations and the participation of experts in advanced countries and through the European Monitoring Evaluation Program (EMEP). Third, we recommend that governments support the private sector to take the lead in implementing an initiative that responds to transboundary environmental problems. Lastly, Korea, China, and Japan can explore ways to strengthen their cooperation with respect to natural gas. If Korea, China, and Japan, the world's leading importers of liquefied natural gas, jointly seek ways to increase the utilization of natural gas and develop advanced pollution abatement technology, the three countries will be able to help tackle environmental challenges in Northeast Asia. 

  The emergence of a new phenomenon widely referred to as the sharing economy has experienced rapid growth over the past few years along with the digital evolution, allowing people to share and optimize underused personal assets on a much larger scale. The fast-paced growth of the sharing economy has taken root worldwide in both the developed and developing countries. In recent years, the sharing economy has disrupted traditional markets and generated difficult legal questions and political debates in various parts of the world. The growth of the sharing economy has led to growing pains for the platforms, participants, and regulators. The problems include legal disputes, taxation, and trust mechanisms. Despite these disputes, however, the three countries have legalized or attempted to authorize the sharing economy in different tactics while trying not to disrupt innovation associated with the sharing economy.
  The objective of this paper is to identify better policy options in the sharing economy for Korea by examining different countries’ policy implications. To achieve this purpose, the structure of this paper is divided into five chapters. The first chapter of the paper develops a conceptual framework that supports to define and explain the sharing economy. The next three chapters touch upon different conflicts and policy implications of the sharing economy across the United States, Europe, and China. Finally, the paper concludes with a discussion of policy implications of the sharing economy for Korea.
  The cases of the US, Europe, and China are three examples of various levels of the sharing economy. The following are the speculated policy characteristics of the sharing economy across three different countries proposed based on the scope of this study. The sharing economy in the United States can be said to be found on the principal driven by the market-based approach. On the contrary, most European countries are subject to more restrictive rules to ensure adequate legal and social protection for all including traditional players. In the case of China, the regulation of the sharing economy is more strongly orientated towards measures for social challenges and economic benefits. The ambiguity or lack of regulations for accommodation sharing are prevalent across all three countries. Large cities in both the US and Europe have begun implementing regulations on accommodation sharing or have launched investigations with the aim of bringing the sharing economy into compliance with existing laws. On the other hand, China is in the early stage of regulation development.
  The regulation of ridesharing varies widely across three countries comparable to short-term rentals. The United States focuses on creating a fair competitive environment by allowing platforms to enter but at the same time supporting the taxi industries instead of banning ridesharing platforms. Some countries in Europe are outlawing ridesharing platforms to protect the traditional market or making platforms to comply with the similar standards as the traditional market. China has legitimized ‘online car reservation service’ as a part of taxi services, and has improved related regulations such as pre-permission for the platform and driver, and requirements for strengthening responsibility.
  A careful and detailed analysis of country-level experiences lead to the following policy implications. First, the introduction of regulation needs to be done as carefully as possible, and more flexible regulatory frameworks are needed to respond to changing market conditions. Second, it is necessary to promptly establish the legal basis for accommodation sharing by strengthening the role of the platform to deal with conflicts such as taxation and disputes generated by the sharing economy. Lastly, in the case of ridesharing, it is advisable for regulatory authorities in Korea to first deregulate much of the current restriction and lower barriers to entry rather than raising them. In the long run, however, it is recommended for the market to ensure a quality environment for all participants to compete fairly. 

Executive Summary

1. Introduction

2 Data and Statistical Description
2.1. Data
2.2. Statistical Description

3. Estimation
3.1. Constructing a Matched Dataset
3.2. Estimation

4. Results
4.1. Sales-Per-Worker and Ecommerce Activity
4.2. Wage and Ecommerce Activity

5. Conclusion

References

Appendix 

Official estimates peg global business-to-business ecommerce at 15 trillion dollars and global business-to-consumer ecommerce at 1.2 trillion dollars in 2013 (UNCTAD 2015). When we turn to official estimates for Korea, it is easy to find that Korea’s business-to-consumer ecommerce market is grow-ing at more than twenty percent per year and has emerged as the third larg-est global ecommerce market in Asia. It is not very much surprising to know the numbers for Korea since Korea is one of the world’s most ad-vanced countries in terms of information and communication technology. However, it is somewhat surprising that we know little about how ecom-merce firms or establishments are distributed in the economy of Korea. In addition, we know little about how ecommerce establishments perform relative to their counterparts of a similar age and size in the same industry.
The paper aims to characterize and test performance differences between ecommerce and non-ecommerce firms or establishments. Although the number of ecommerce establishments makes up a small fraction of the economy, ecommerce establishments have a heavier weight in sales, em-ployment, and wage. Due to endogeneity of ecommerce variable, the paper reconstructs the 2010 Korea Census dataset by using Propensity Matching Score and shows that in manufacture ecommerce establishments have, on average, larger sales-per-worker and pay higher wage whereas in services ecommerce ones have higher sales-per-worker but pay no larger wage than their counterparts of a similar age and size in the same industry. It also adds quantile estimates showing that sales-per-worker differences between ecommerce and non-ecommerce establishments in manufacture are positive and statistically significant only at lower quantiles of the distribution. In ser-vices, sales-per-worker differences between them are positive and signifi-cant at most of distribution but turns to be negative, though not significant, at above upper quantile of the distribution.

Keywords: Ecommerce, Firm Performance, Sales-per-worker, Wage
JEL Classification Numbers: F1 

Executive Summary

Ⅰ. Introduction

Ⅱ. Literature Reviews on SME Technologies

Ⅲ. SME Technological Progress in Chinese Taipei
3.1 Current Status of SMEs
3.2 Government Policies on SMEs
3.3 Promotion of SME Technologie
3.4 Technology Cooperation with Developed Countries

Ⅳ. Implications to Selected APEC Member Economies
4.1 Implications to Viet Nam
1) Current Status of SMEs
2) Government Policies on SMEs
3) Promotion of SME Technologies
4) Technology Cooperation with Developed Countries

4.2 Implications to Malaysia
1) Current Status of SMEs
2) Government Policies on SMEs
3) Promotion of SME Technologies
4) Technology Cooperation with Developed Countries

4.3 Implications to Indonesia
1) Current Status of SMEs
2) Government Policies on SMEs
3) Promotion of SME Technologies
4) Technology Cooperation with Developed Countries

4.4 Implications to the Philippines
1) Current Status of SMEs
2) Government Policies on SMEs
3) Promotion of SME Technologies
4) Technology Cooperation with Developed Countries

Ⅴ. The Role of APEC on SME Technological Progress and Cooperation
5.1 Needs for the Role of APEC
5.2 APEC Activities for Government Policies on SMEs
5.3 APEC Activities on Technology Promotion Policies
5.4 APEC Activities on SME Technology Cooperation

Ⅵ. Concluding Remarks

References 

  Chinese Taipei became one of the most successful economies in Asia after the WWII, and the country was one of the four Asian tigers together with the Republic of Korea, Chinese Hong Kong and Singapore. Their economic achievement was mainly originated from the development of SMEs which government policies were effectively implemented and brought strong im-pacts on technological progress. SMEs were able to obtain technologies through research and development, and technology transfer from developed countries with various cooperation programs. However, APEC economies notably Viet Nam, Malaysia, Indonesia and the Philippines have achieved economic development and SME technological promotion, but they are not comparable with Chinese Taipei. This paper analyses Chinese Taipei govern-ment policies on SMEs, technological progress, and technology cooperation with developed countries. These areas are compared with other four APEC economies. It brings some suggestions how APEC can enhance SME tech-nology cooperation with other countries.

Keywords: SME, technological progress, technology cooperation, Chinese Taipei,
the Philippines, Malaysia, Indonesia, Viet Nam, APEC
JEL Classification: L60, F21, O33