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In the Shadow of Debt:The Sad but True Tale behind a Quarter Century of Stagnation in the Philippines
By Walden Bello*
Assaulted on all
sides owing to its entanglement in the ZTE-NBN corruption scandal,
the administration has confronted its critics with the image of an
economy that is purring along, that is doing just fine except for the
rise in the price of rice, for which it says it is blameless.
Deconstructing
"Growth" in 2007
But
the state of the economy, even some of the administration's friends
have pointed out, is a thin reed on which to rest. In a recent
article, Peter Wallace, an influential consultant, deconstructed the
7.3 per cent growth rate recorded for the Philippines in 2007,
showing that the figure is actually a statistical fluke that stems
from the way the measure Gross Domestic Product (GDP) is computed.
The figure actually masks something negative: the fall of imports by
5.4 per cent. "So because we had less imports, GDP looked good,"
Wallace says. "From where I sit, that does not indicate a strong,
growing economy, the best in 31 years."i
With no less irony, the World Bank agrees: "Remarkably, weaker
import growth made the largest arithmetical contribution to the
growth acceleration in 2000-07 compared to 1990-99." It added that
this was not "consistent with sustained fast growth in the longer
term."ii
The reality,
Wallace points out, is indicated by the same brutal numbers: more
poor people in 2007 than in 2000, more people without jobs, a real
decline in average family income, the shrinking of the middle class
as more people jump ship and swim to other shores.
"Notwithstanding higher growth," the World Bank chimes in, "the
latest official poverty estimates show that between 2003 and 2006,
when GDP growth averaged 5.4 per cent, poverty incidence increased
from 30.0 to 32.9 per cent. This level of poverty incidence is
almost as high as it was in 2000 (33 per cent). Indeed the magnitude
of poor Filipinos rose to its highest level in 2006: of a population
of 84 million in 2006, 27.6 million Filipinos fell below the national
poverty threshold of P15, 057."iii
If
you pop the famous "Ronald Reagan" question to most Filipinos-"Do
you feel better off now than four years ago"-there is no doubt
about how they would answer.
For many people,
the main problem confronting the economy is spelled G-M-A. But for
those who have spent time studying the Philippine economy, Arroyo is
not the problem, but part of a bigger problem that extends far
into the recent past. The collective responsibility of the last five
administrations for our economic malfunctioning becomes stark when
viewed in a comparative context. According to the latest Human
Development Report of the United Nations Development Program
(UNDP), with the growth in GDP per capita averaging 1.6 per cent per
annum in the period 1990 to 2005, the Philippines' economic growth
record was the worst in Southeast Asia, with even all the so-called
lower-tier ASEAN countries significantly outstripping it.iv
Say that again? OK. Now, Vietnam (5.9 per cent) is not a surprise.
But, for Christ's sake, Laos (3.8 per cent), Cambodia (5.5 per
cent), and Myanmar (6.6 per cent)?
So what are the
real causes of this state of stagnation that has now lasted for over
25 years?
There is, of
course, the old overpopulation-causes-poverty school. The weight of
decades of research, however, is that it is economic growth that
causes a significant decline in population growth-the so-called
"demographic transition-instead of reduced population serving as
the trigger for economic dynamism. This is not to say that a slowing
of the population growth rate does not make the burden of development
lighter. It does, and fertility control also contributes positively
to women's empowerment, which is why contraceptive programs
continue to be critical.
It
is, however, the other, seemingly more solid explanations for the
Philippines' failure to launch that interest us here. There are
three that are particularly popular with the establishment:
corruption, protectionism, and high wages. Let's look at these
closely.
Is
it Corruption?
Undoubtedly,
the most popular is Peter Wallace and the World Bank's favored
answer--that is, that cronyism and corruption are holding the
Philippines back. This view is reinforced by the news that, for two
years in a row, the Philippines has been designated the "most
corrupt economy" in Asia by the influential Political and Economic
Risk Consultancy (PERC).
Now,
there is no doubt that corruption erodes governance, subverts
democracy, and is morally corrosive. And there is no doubt in this
writer's mind that the illegitimate occupant of Malacanang deserves
to be hung, drawn, and quartered-legally, that is, not
physically-for presiding over one of the most corrupt regimes in
the history of the republic. However, it is another thing to say
that corruption and cronyism are mainly responsible for the
Philippines' failure to get out of the stagnation in which it is
mired. The reason one must be skeptical of this explanation is that
in many other societies, periods of rapid growth have also been
periods of endemic corruption in politics, and this observation
includes England in the 18th century, the US in the
nineteenth and early 20th centuries, and Korea in the late
sixties to the eighties.
Closer to home,
corruption pervaded the politics of our Southeast Asian neighbors,
such as Thailand, Malaysia, and Indonesia during their period of
rapid industrialization from the mid-eighties to the mid-nineties,
when they experienced 6 to 10 per cent growth rates. Indonesia under
Suharto, for instance, occupied the position the Philippines is now
in, being regularly rated as the most corrupt government in Asia.
Double-entry book-keeping, tax evasion, bribing of politicians and
bureaucrats, and massive fraud were legendary in Thailand in its boom
decade.
Observations
casting doubt on the correlation between stagnation and corruption
have received confirmation from more systematic studies. Focusing
on Southeast Asia, Mustaq Khan and Jomo K.S. found no simple
correlation between the extent of rent-seeking and long-run economic
performance and found the thesis that crony capitalism caused the
Asian financial crisis of 1997 a rather dubious one.v
Working with a bigger global sample, I.A. Brunetti, G. Kisunku, and
B.Weder's research found that, if at all, the impact of corruption
on GDP growth was not significant.vi
Other studies have found that, as in the case with population growth
and poverty, the direction of causation is more likely to be from
poverty to corruption rather than the other way around. vii
Summing
up the conclusion of a slew of studies on growth and corruption,
Herbert Docena says, "Too many empirical anomalies undermine the
conclusion" that corruption is a significant explanation for
economic backwardness. viii
What research has done is simply to confirm the intuitive sense that
the customs agent that builds a house with ill-gotten wealth
stimulates the economy as much as the middle manager who builds one
with her legitimate savings. The difference between them lies not in
their economic effects but in what their ethical and legal destinies
should be: the former deserves to go to jail while the other deserves
to enjoy the fruits of her labor.
There is an added
problem with the corruption explanation for stagnation, Docena
argues. The popular discourse that attributes economic backwardness
to corruption and cronyism plays into the dynamics of elite politics
and that of multilateral institutions like the World Bank.
"Corruption discourse" is the preferred weapon in the political
competition among the different factions of the elite. It is
discourse that performs the function of allowing elites to compete
and succeed one another in office without fatally destabilizing a
social structure that is shot through with inequity.ix
The
Neoliberal Explanation
Another
favorite explanation is that stagnation stems from the "strong"
protection offered to domestic industry. The Philippines, it is
said, has not been exposed enough to market forces that would have
shaken it out of its "inefficiency."
The
problem with this analysis is that, in fact, the Philippines was
subjected to radical tariff liberalization in the 1980's and
1990's. Under programs imposed by the World Bank and International
Monetary Fund (IMF) in the 1980's, the average tariff rate was
brought down from 43 per cent in 1980 to 28 per cent in 1985 while
quantitative restrictions were removed on more 900 items between 1981
and 1985.x
This process of liberalization was accelerated in the mid-1990's
under the Ramos administration's Executive Order 264, which sought
to drive down tariffs on all but a few sensitive products to between
1 and 5 per cent in 2004.
Moreover,
the liberalization program in the Philippines was often more profound
than those of our neighbors, which were growing by leaps and bounds
while we stagnated. For instance, by the end of the eighties, the
average tariff rates in Indonesia and the Philippines were just about
equal while Indonesia had a greater proportion of goods subjected to
non-tariff barriers than the Philippines.xi
Compared to Thailand, which was, in many ways, the best performer
among the Southeast Asian "newly industrializing countries"
(NICs) in the 1985-1995 period, the Philippines was much farther
along the liberalization road: by the end of the eighties, the
effective rate of protection for manufacturing in Thailand was 52 per
cent, compared to 23 per cent for the Philippines.xii
In
fact, in the 1980's and 1980's, the strategy of our neighbors was
not one of indiscriminate liberalization such as that pursued by
Philippine technocrats but one of strategic protectionism cum
selective liberalization that was designed to deepen their industrial
structures. As one wag who was trying to drive home the contrasting
outcomes in the Philippines and our neighbors put it, the crucial
difference was that our technocrats preached free trade and practiced
it, while our neighbors boasted of their free trade credentials while
practicing protectionism. In other words, in world ruled by economic
realpolitik, it is often not a virtue to practice what you preach.
Management's
Story
A
third explanation favored by the establishment is that too much legal
protection of labor has made wages rigid and non-competitive with
other Asian countries, thus making the Philippines an unattractive
investment site.
Though
it has been successfully used by management to dampen wage demands,
this argument has been seriously undermined by the facts. The real
wage in 2003 was only 80 per cent of what it was in 1980 and labor's
share in GDP has dropped from 75 to 65 per cent. xiii
In contrast, capital's share of GDP has increased by 10 per cent
and the profit rate has shown an upward trend, from 8 per cent in
1985 to nearly 13 per cent in 2002.xiv
The Spanish economist Jesus Felipe and his Filipino colleague
Leonardo Lanzona, Jr., argue in a study for the Asian Development
Bank that except in some areas, Philippine labor market policies
cannot be seen as the main culprit for the economy's failure to
lift off.. Indeed, they do not see an increase in current wages as a
problem since, seen from a neo-Keynesian perspective, the Philippines
falls into the category of being a "wage-led economic regime,"
where, owing to persistently low levels of investment by capital, an
increase in wages will lead to a higher level of aggregate demand
that will result in a utilization of current excess capacity in
industry, leading to faster growth and more employment. xv
So
why is the Philippines stuck in what is effectively a low-growth
path, where unemployment and underemployment constinue to rise even
when the economy is growing by 5-6 per cent? The culprit, Felipe and
Lanzona strongly suggest, is low capital accumulation or investment:
"In the Philippines...the lack of investment is a well known
problem....It is possible that the Philippines' low capital stock
per worker, due to lack of investment, has led to higher markups and
unemployment. Thus, the policy prescriptions to reduce unemployment
would be investment and not labor market reforms."xvi
The
Investment Conundrum
One cannot then understand Philippine underdevelopment without
reference to the crisis of investment. From nearly 30 per cent in
the early eighties, the ratio of investment to GDP plunged to 17 per
cent in the mid-eighties and never really recovered, staying at 20-22
per cent in the early part of this decade. The same pattern of
collapse and very weak recovery is also seen in the growth of capital
stock, which fell from an index of nearly 0.07 in 1983 to nearly zero
in 1985 and leveled off at below 0.03 in the early part of this
decade.xvii
To
understand the dismal performance of investment over the last two
decades, one must situate these figures in their historical
politico-economic context.
While
the Marcos regime is often pinpointed as the culprit behind
Philippine underdevelopment, an equally decisive part has been played
by the post-Marcos administrations. The private sector unraveled in
the early 1980's owing to the effects of a structural adjustment
program---trade liberalization cum monetary and fiscal
tightening--imposed by the World Bank and IMF at a time of
international recession. Describing the fatal conjunction of local
adjustment and international downturn, the late economist Charles
Lindsay said, "Whatever the merits of the SAL [structural
adjustment loan], its timing was deplorable."xviii
The collapse of industry, it must also be noted, took place amidst a
political crisis that marked the transition from the dictatorship to
the presidency of Corazon Aquino.
Why
Government Spending was Gutted
The
downward spiral of private investment was not met by a
countercyclical effort of government to shore up the economy, as
would be expected under orthodox macroeconomic management. This was
a catastrophic failure, and the cause of it was external. Owing to
pressure from international creditors, the fledgling democratic
government of President Corazon Aquino adopted the so-called "model
debtor strategy" in the hope of continuing to have access to
international capital markets. This approach was cast in iron by
Executive Order 292, which affirmed the "automatic appropriation"
from the annual government budget of the full amount needed to
service the foreign debt.
What
this meant is that instead of picking up the investment slack,
government resources flowed out in debt service payments. In the
critical period 1986-1993, an amount coming to some 8 to 10 per cent
of GDP left the Philippines yearly in debt service payments, with the
total amount coming to nearly $30 billion.xix
This figure was nearly $8.5 billion more than the $21.5 billion
Philippines total external debt in 1986. What is even more appalling
is that owing to the onerous terms of repaying debts that were
subject to variable interest rates and the practice of incurring new
debt to pay off the old, instead of showing a reduction, the foreign
debt in 1993 had gone up to $29 billion!xx
What
this translated into was that interest payments as a percentage of
total government expenditure went from 7 per cent in 1980 to 28 per
cent in 1994. Capital expenditures, on the other hand, plunged from
26 to 16 per cent. Debt servicing, in short, became, alongside wages
and salaries, the no. 1 priority of the national budget, with capital
expenditures being starved of outlays.xxi
Since government is the biggest investor in the country--indeed, in
any country--the radical stripping away of capital expenditures
represented by these figures goes a long way towards explaining the
stagnant 1.0 per cent average yearly GDP growth rate in the 1980's
and the 2.3 per cent rate in the first half of the 1990's.xxii
The
anti-growth implications of the state's being deprived of resources
for investment were very clear to Filipino economists during the
mid-eighties. As the University of the Philippines professors who
authored the famous 1985 "White Paper" warned: "The search for
a recovery program that is consistent with a debt repayment schedule
determined by our creditors is a futile one and should therefore be
abandoned."xxiii
Government
and Investment: Contrasts with out Neighbors
Why
do we focus on key policy decisions made in the period 1985 to 1995?
The reason is that these decisions-in particular the fateful
decision to channel government financial resources to debt repayment
instead of capital expenditures-go a long way towards explaining
why our neighbors leaped forward as we stagnated. Contrary to
doctrinaire free-market economics, institutional economists argue
that government financial resources devoted to building physical or
social infrastructure or shoring up domestic demand "crowd in"
rather than "crowd out" private investment, including foreign
investment. For instance, one key study of a panel of developing
economies from1980 to 1997 found that public investment
complemented private investment, and that, on average, a 10 percent
increase in public investment was associated with a 2
percent increase in private investment.xxiv
Now
the key explanation for why our neighbors flourished in the period
1985-95 is that they were deluged with Japanese investment that was
relocating from Japan to make up for the loss of competitiveness of
Japan-based production owing to the drastic revaluation of the
Japanese yen relative to the dollar under the famous Plaza Accord in
1985. This flow of Japanese investment to our neighbors was not
accidental. Nor was it accidental that the Japanese bypassed the
Philippines. For while our external creditors were busy stripping
our government of resources for investment in infrastructure, our
neighbors were frantically devoting resources to financing
infrastructure to attract or crowd in Japanese direct investment.
Indonesia, for instance, attracted $3.7 billion worth of Japanese
direct investment between 1985 and 1990
A key reason was the high level of government capital expenditures,
which came to 47 per cent of total expenditures in 1980, 43 per cent
in 1990 and 47 per cent in 1994.xxv
Or take Thailand. It pushed down interest payments from 8 per cent
of government expenditure in 1980 to 2 per cent in 1995 and raised
capital expenditures from 23 per cent to 33 per cent. xxvi
In the late eighties and early nineties, Thailand received $24
billion in foreign direct investment from Japan, Korea, and Taiwan,
or 15 times the amount invested by the three countries in the
Philippines, which came to a paltry $1.6 billion. There is no doubt
that government capital spending crowded in foreign investment in
Thailand and the lack out it crowded out foreign investment in the
Philippines. And there is no doubt that, as KunioYoshihara asserted,
"This difference in the flow of foreign investment from [Japan,
Korea, and Taiwan] produced a significant disparity in growth
performance of the two countries during this period."xxvii
Like
all clear-thinking investors, the Japanese were not going en masse to
a place where infrastructure was decaying and where the market was
depressed and poverty was increasing owing to a political economy
shackled by structural adjustment and battered by the priority given
to repaying the foreign debt. They were, in short, not stupid.
This
trend of continuing outflow of government resources in the form of
payments to creditors and the shrinking of capital expenditures
continued into the first years of this decade. In 2005, according to
the World Bank, 29 per cent of the government expenditures was
devoted to interest payments to both foreign and domestic creditors
and 12 per cent to capital expenditures.xxviii
Calculations by James Miraflor of the Freedom from Debt Coalition
put servicing of the foreign and domestic debt (most of which is said
to be owed to locally based foreign entities) at 51 per cent in 2005,
54 per cent in 2006, and 41 per cent in 2007. This configuration of
government spending prompted the UP School of Economics faculty to
complain once again that the budget left "little room for
infrastructure spending and other development needs," though they
did not follow through on the policy consequences of their analysis.xxix
They were joined, in an extraordinary example of hypocrisy, given its
historical role in foisting the debt service at the head of the
trough of government spending, by the World Bank, which complained in
a 2007 policy brief:
The
Global Competitiveness Index ranks the Philippines at only 71 out of
131 countries, rating the country particularly poorly on a majority
of the infrastructure indicators. The quality of transport
infrastructure (which includes roads, railways, ports, airports, and
logistics) is a particularly serious concern, with consequences for
trade-related transaction costs and overall competitiveness. Recent
assessments indicate that transport infrastructure is poorly
maintained and badly managed, with years of underinvestment,
especially in maintenance." xxx
Not
surprisingly, with government capital expenditures remaining low,
total fixed investment has remained anemic, indeed running at only 14
per cent of GDP, which the World Bank notes is "substantially lower
even than during the deep recession in the first half of the 1980's
and substantially lower than in most other larger East Asian
economies."xxxi
Durable equipment investment, it added, reached a historic low in
2007.xxxii
The problem, as usual, is not the Bank's description of
developments but its refusal to see their origins in policies in the
formulation of which the Bank was deeply implicated.
The
Other Shoe Drops: Trade Liberalization and the Fiscal Crisis
The
explanation for our national stagnation is not exhausted by the
priority our leaders accorded to repaying the foreign debt.
Activists governments, we have seen, have been key players in
development in Southeast Asia. But the Philippine government was
incapacitated from playing this activist role by a one-two punch
delivered by external forces. If the hemorrhage of payments on the
debt hit it on the expenditure side, trade liberalization, by
drastically reducing a very critical source of government revenues,
clobbered it on the revenue side. But before we detail this second
blow, the fiscal impact of trade liberalization, it is important to
place the latter in the context of the comprehensive structural
adjustment cum trade liberalization program which chokedthe country
in the eighties and nineties.
It
is fashionable these days to decry the weakness of the Philippine
manufacturing sector, which was supposed to play the role of
absorbing a greater and greater portion of the labor force into
high-value-added jobs. Trade liberalization was, in theory, supposed
to reinvigorate Philippine industry by, among other things, ending
monopolization. Instead, what happened was monopolization increased
as trade liberalization intensified.xxxiii
Why? It is very likely that monopolization rose because weaker
firms were driven out of business by trade liberalization--an
understandable outcome but one that did not fit the neoliberal
paradigm.
As
noted earlier when we discussed and dismissed protectionism as a
possible explanation for the Philippines' economic stagnation,
trade liberalization in this country was no joke. The effective rate
of protection for manufacturing was pushed down from 44 to 20 per
cent. That was achieved at the cost of multiple bankruptcies and
massive job losses-in short, de-industrialization. The list of
industrial casualties included paper products, textiles, ceramics,
rubber products, furniture and fixtures, petrochemicals, beverage,
wood, shoes, petroleum oils, clothing accessories, and leather goods.
The textile industry was practically rendered extinct by the
combination of tariff cuts and the abuse of duty-free privileges,
with the number of forms shrinking from 200 firms in 1970 to less
than 10 by the end of the century. As former Finance Secretary
Isidro Camacho, Jr., admitted, "There's an uneven implementation
of trade liberalization, which was to our disadvantage." While
consumers may have benefited from tariff cuts, he said,
liberalization "has killed so many local industries."xxxiv
Yet
the negative effects of trade liberalization were not limited to the
erosion of the country's industrial base. Trade liberalization had
fiscal effects. If the hemorrhage of payments on the foreign debt
blew a hole on the expenditure side, trade liberalization, by
reducing a very critical source of government revenues blew a hole on
the revenue side. The trade liberalization that started with
Executive Order 264-which phased in, beginning 1994, a radical
program to unilaterally reduce all tariffs to 0 to 5 per cent by
2004-resulted in radically decreased customs collections in a very
short period of time. In the period 1995-2003, while the value of
imports grew by 40 per cent, customs collections of import duties
declined by 35 per cent; imports rose from US$25.5 billion in 1995 to
$37.4 billion in 2003, but import duties fell from P64.4 billion to
P41.4 billion.xxxv
As a percentage of GDP, total customs collections fell from 5.6 per
cent of GDP in 1993 to 2.8 per cent in 2002. As a percentage of
government revenues, customs duties and taxes from international
trade fell from 29 per cent in 1995 to 19 per cent in 2000 at a time
that hardly any new revenue sources had come onstream.xxxvi
Combined
with the outflow of debt service payments, the collapse in customs
revenues precipitated the fiscal implosion, which made it even more
difficult for government to finance the capital expenditures that
were necessary to crowd in both domestic and foreign investment in
order to decisively lift the country from the stagnation of the
eighties and nineties. Former Finance Secretary Camacho could not
but admit the obvious-that it was not so much failure to increase
taxation but the drive to decrease import taxation that mainly
accounted for the crisis in government revenue: "The severe
deterioration of fiscal performance from the mid-1990's could be
attributed to aggressive tariff reduction."xxxvii
To
say this is not to excuse the current administration and its
predecessors from not making a greater effort at tax collection,
especially from their private sector cronies, just as our earlier
remarks were not meant to excuse corruption. It is mainly to achieve
a clearer understanding of the key structural factors and dynamics
that have condemned the Philippines to almost permanent stagnation.
One can agree with Peter Wallace that the Philippines needs a much
bigger effort to enforce taxation and punish tax evaders without
having to say that this failure is what precipitated the crisis on
the revenue side. Trade liberalization precipitated that crisis,
which resulted in, among other things, a further crippling of the
capacity of the Philippine state to play a positive role in
development.
When
Paradigms Blind
In
conclusion, the dominant explanations for the continuing stagnation
that has caused so many Filipinos to abandon ship are deeply flawed.
Why they continue to be popular is due to their being easy to grasp
(corruption) or ideologically correct (lack of market freedom).
Alternative explanations are screened out because they are not
ideologically correct or because they are, like the burden of debt
thesis, simply unacceptable as explanations and options for action to
the establishment. Yet it requires no special intelligence to
realize that the massive amounts of money that have gone to paying
our creditors to service our constantly mounting external debt was
money that could not go to development. It cannot be otherwise given
that resources are finite. Sometimes such truths can only be
grudgingly accepted when events occur that force their acceptance.
For instance, it can no longer be denied that Argentina's five-year
string of 10 per cent annual GDP growth is due principally to
President Nestor Kirchner's courageous act of unilaterally
writing down-that is, paying about 25 cents of every dollar owed to
bondholders--on most of that country's foreign debt and
channeling the money saved to domestic investment.
With
the failure of doctrinaire neoliberalism to both explain and move
countries out of underdevelopment, we are beginning once more to
appreciate the positive role of the state in development, in its
triple role of assisting the market, disciplining the market, and
leading the market. What we have tried to do here is to position the
incapacitation of the Philippine state as the central factor in
explaining the stagnation of the Philippine economy. The priority
accorded to repaying the foreign debt in the context of an economy in
crisis deprived the state of financial resources to play its role as
the economy's biggest investor, thus crowding out private
investment. This emasculation on the expenditure side was paralleled
by a crippling on the revenue side by the collapse of customs
revenues owing to aggressive trade liberalization. This double punch
amplified the depressive effects of the policy framework of
structural adjustment cum trade liberalization that was imposed on
the country in the eighties and nineties with the acquiescence of our
leaders. This suffocating policy framework unfortunately lives on,
with minor adjustments, and as long as it remains this country's
basic paradigm, it is difficult to see the Philippines emerging from
its long night of stagnation.
*President of Freedom from Debt
Coalition, senior analyst at Focus on the Global South, and professor
of sociology at the University of the Philippines. The author would
like to thank James Matthew Miraflor and Bobby Diciembre of the
Freedom from Debt Coalition for their assistance.
i
Peter Wallace, Manila Standard, Feb. 29, 2008.
ii
World Bank, Accelerating Inclusive Growth and Deepening Fiscal
Stability (Manila: World Bank, March 2008), p. 26.
iii
Ibid., p. 67
iv
United Nations Development Program, Human Development Report
2007/ 2008 (New York:: United Nations Development Program,
2008), pp. 277-280.
v
Mushtaq H. Khan and Jomo Kwame Sundaram, eds., Rents,
Rent-Seeking, and Economic Development (Cambridge: Cambridge
University Press, 2000), p. 4.
vi
A.Brunetti, G. Kisunku, and B. Weder, "Credibility of Rules and
Economic Growth-Evidence from a Worldwide Private Sector Survey,"
Background paper for the World Development Report 1997, cited
in Jens Chr. Andvig and Odd-Helge Fjelstad, Corruption: a Review
of Contemporary Research (Bergen, Norway: Chr. Michelsen
Institute, 2001), p. 74.
vii
Research cited in Andvig and Fjelstad, p. 64.
viii
Herbert Docena, "Corruption and Poverty: Barking up the Wrong
Tree?," in Walden Bello, Herbert Docena, Marissa de Guzman, and
Marylou Malig, The Anti-Development State: The Political Economy
of Permanent Crisis in the Philippines (London: Zed Press,
1995), p. 281.
ix
Ibid., pp. 288-289.
x
Charles Lindsay, "The Political Economy of Economic Policy Reform
in the Philippines: Continuity and Restoration," in Andrew
MacIntyre and Kanishka Jayasuriya, eds., The Dynamics of Economic
Polity Reform in the Philippines (Singapore: Oxford University
Press, 1992).
xi
See Kunio Yoshihara, The Nation and Economic Growth (Kuala
Lumpur: Oxford University Press, 1994), p. 108; and Amar
Bhattacharya and Mari Pangestu, "Indonesia: Development
Transformation and the Role of Public Policy," in Danny Leipziger,
ed., Lessons from East Asia (Ann Arbor: University of
Michigan Press, 1995), p. 408.
xii
Scott Christensen et al., "Thailand: The Institutional and
Political Underpinnings of Growth," in Leipziger, ed., p. 354.
xiii
Jesus Felipe and Leonardo Lanzona, Jr., "Unemployment, Labor Laws,
and Economic Policies in the Philippines," in Jesus Felipe and
Rana Hasan, Labor Markets in Asia: Issues and Perspectives
(Houndmills, Basingstoke, Hampshire: Palgrave Macmillan, 2006), pp.
394, 441
xiv
Ibid. p. 441
xv
Jesus Felipe and Rana Hasan, "Labor Markets in a Globalizing
World," in Felipe and Hasan, eds., Labor Markets in Asia:
Issues and Perspectivesp. 117.
xvi
Felipe and Lanzona, p. 460.
xvii
Felipe and Lanzona, p. 447.
xviii
Lindsay.
xix
World Bank, World Bank Debt Tables, Vol. 2 (Washington, DC:
World Bank, 1994), p. 378.
xx
Ibid., p. 379.
xxi
World Bank, World Development Indicators 1998 (Washington,
DC: World Bank, 1997), p. 199.
xxii
Ibid, p. 131.
xxiii
Florian Alburo, et al., "Towards Recovery and Sustainable
Growth," School of Economics, University of the Philippines,
Diliman, Quezon City, September 1985.
xxiv
See, for instance, Lufti Erden and Randall Holcombe, "The Effects
of Public Investment on Private Investment in Developing Economies,"
Public Finance Review, Vol. 33, No. 5 (2005), pp. 575-602.
xxv
World Development Indicators 1997, p. 199; World
Development Indicators 2000, p. 233; World Development
Indicators 2003, p. 231.
xxvi
World Development Indicators 1998, p. 224.
xxvii
Yoshihara, p. 52
xxviii
Calculated from figures provided in World Bank, Accelerating
Inclusive Growth and Deepening Fiscal Stability.
xxix
Emmanuel de Dios et al., "The Deepening Crisis: The Real
Score on Deficits and the Public Debt," Faculty of Economics,
University of the Philippines, August 2004.
xxx
World Bank, Accelerating Inclusive Growth..., p. 5
xxxi
Ibid, p. 27
xxxii
Ibid.
xxxiii
Felipe and Lanzona, p. 441
xxxiv
Eric Boras, "Government Loses P120 Billion to Tariff Cuts,"
Business World, Oct. 20, 2003.
xxxv
Figiues from Bureau of Customs and National Statistical Coordination
Board.
xxxvi
Figures from World Development Indicators 1998, p. 227 and
World Development Indicators 2003 , p. 235
xxxvii
Cited in Boras.
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