This study examines the impact of social capital on the poverty of rural households in eastern Bhutan, with a particular focus on households' participation in community groups, which can be a proxy for the structural aspect of social capital. Using a two‐stage probit least squares simultaneous equation model, the present study reveals that social capital positively contributes to poverty reduction in Bhutan. This study also finds that non‐farm income is important for poverty reduction in rural areas. Our results, however, indicate that poor households in remote areas are discouraged from participating in community groups.
This article traces the development of industrial policy towards the Indonesian motor industry within the automotive global value chain. Showing the current dominance of Japanese motor assemblers in Indonesia, it notes the rather undeveloped nature of the locally owned supporting industry, particularly compared with that of neighbouring Thailand. Most investment in auto-parts production has been by foreigners. Nevertheless, Indonesia's rapid domestic-market growth has allowed it to attract foreign automotive investment without having to offer excessively generous incentives. While the continued entry of foreign suppliers of auto parts into Indonesia offers opportunities for local suppliers to upgrade their productive capabilities, it also limits their chances of becoming first-tier suppliers themselves. Japanese automotive investors are optimistic about Indonesia's export potential, more so than Malaysia's.
This paper examines the determinants of total factor productivity (TFP) in the Malaysian automotive industry, focusing on the effectiveness of government policies. Our panel data analysis shows that the productivity of the automotive industry in Malaysia highly depends on the technology embodied within imports. Government policies have not contributed to the technological upgrading of the industry. The policies to protect the domestic producers from international competition and to favor bumiputra firms seem to have adverse impacts on productivity.
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