Template-Type: ReDIF-Article 1.0 Author-Name: Fidelina B. Natividad-Carlos Author-Workplace-Name: University of the Philippines School of Economics Title: Monetary and Fiscal Policies, Endogenous Currency Substitution, and Exchange Rate Volatility Abstract: This paper employs two small, open economy macro models of exchange rate determination - a portfolio balance model and an asset market model ¨C to examine implications of endogenous currency substitution on exchange rate volatility arising from monetary and fiscal policies. It is shown that, in both models, the exchange rate response and the extent of exchange rate overshooting and undershooting depend on the degree of currency substitution. Journal: Philippine Review of Economics and Business Pages: 1-26 Volume: 35 Issue: 1 Year: 1998 Month: June File-URL: http://pre.econ.upd.edu.ph/index.php/pre/article/view/78/493 File-Format: Application/pdf Handle: RePEc:phs:prejrn:v:35:y:1998:i:1:p:1-26 Template-Type: ReDIF-Article 1.0 Author-Name: Jose Antonio Tan III Author-Name: Cayetano Paderanga, Jr. Author-Workplace-Name: University of the Philippines School of Economics Title: A Note on Philippine Financial Openness Abstract: In 1991, the Philippine launched a series of foreign exchange reforms, which partially opened the capital account. These set of reforms, if completed, will result in the financial integration of the economy with the global financial markets, thus, would complete the sequence of liberalization and integration. This study examines the degree of financial integration of the Philippines with the international economy. In particular, two questions are to be answered. First, how financially integrated is the Philippines with the rest of the world? And, second, how has foreign exchange liberalization contributed to Philippine financial openness? Philippine financial openness is examined using the gross capital flow ratio, the Feldstein-Horioka regressions, and variations of tests based on uncovered interest parity. While the result confirms the substantial increase in gross capital flows, evidence using investment-saving correlation and arbitrage tests suggests that the degree of financial openness is still low. The empirical evidence also suggests that capital account liberalization has not contributed much to financial integration. Journal: Philippine Review of Economics and Business Pages: 27-61 Volume: 35 Issue: 1 Year: 1998 Month: June File-URL: http://pre.econ.upd.edu.ph/index.php/pre/article/view/79/510 File-Format: Application/pdf Handle: RePEc:phs:prejrn:v:35:y:1998:i:1:p:27-61 Template-Type: ReDIF-Article 1.0 Author-Name: Florian A. Alburo Author-Workplace-Name: University of the Philippines School of Economics Title: The Asian Financial Crisis and Policy Response in the Philippines Abstract: Both in country and regional evidence show that the Philippine did not have the symptoms of the ¡°Asian-flu¡± before its outbreak into a full-blown Asian financial crisis. Although cannot be validated (in a counterfactual sense), one can argue that it may have been the early start of crisis elsewhere that now makes the country face less harsh consequences and adjustment. The Philippines is therefore not just an innocent bystander in the confluence of events in the region. This conclusion does not diminish the task of defining policies to address the root cause of crisis and to adjust to the environment it creates. In terms of policy response, it may have been a blessing in disguise that the country did not have sufficient reserves to put up a defense early on. It is this, which paved the way for the actual policy of freeing the exchange rate, rather than conviction that the exchange rate should not be target. Indeed, there are policies which are vestiges of this defense mechanism still in the books (e.g. interest rate cure). On the other hand, there remains a policy vacuum in the area of financial sector reforms, the very area that appears to be where the crisis started in the Asian region. Journal: Philippine Review of Economics and Business Pages: 62-86 Volume: 35 Issue: 1 Year: 1998 Month: June File-URL: http://pre.econ.upd.edu.ph/index.php/pre/article/view/80/506 File-Format: Application/pdf Handle: RePEc:phs:prejrn:v:35:y:1998:i:1:p:62-86 Template-Type: ReDIF-Article 1.0 Author-Name: Muzafar Shah Habibullah Author-Name: Peter Smith Author-Workplace-Name: Title: Modeling Inflation in the Philippines: The P-Star Model Approach Abstract: The P-Star approach of modeling inflation has been widely tested for the United States and other developed countries. However, the robustness of the P-Star model for developing countries has received less attention among the researchers. The purpose of this study is to test the applicability of the P-Star approach, which respect to a developing country ¨C the Philippines. Using a sample period of 1981:1 to 1994:4, our results suggest that the monetary data for the Philippine support the P-Star model approach. Our results indicate that broad money M2 provides an anchor for the Philippines inflation during the period under study. Journal: Philippine Review of Economics and Business Pages: 87-96 Volume: 35 Issue: 1 Year: 1998 Month: June File-URL: http://pre.econ.upd.edu.ph/index.php/pre/article/view/81/503 File-Format: Application/pdf Handle: RePEc:phs:prejrn:v:35:y:1998:i:1:p:87-96 Template-Type: ReDIF-Article 1.0 Author-Name: Niceto S. Poblador Author-Workplace-Name: University of the Philippines School of Economics Title: Administrative Control in Small Business Organizations in the Philippines Abstract: This article reports on the study of the control practices of managers of small business organizations of the Philippines. Where possible, results are compared with those obtained from similar surveys conducted by the author elsewhere in the region. Among the hypothesized ¡°determinants¡± of control, the perception of interdependency among organizational components appear to have the strongest impact. Surprisingly, the perception of external uncertainty seem to have little effect on the level of control, leading us to conclude that the relationship between the two variables is best described by a U-shaped curve. The relationship between control and performance is an extremely complex one, considering that either variable may be the dependent one. Interestingly, however, the observed relationship between the level of control ¨C here treated as the dependent variable ¨C and perceived performance appears to be flat within the relevant range. The paper concludes by showing that Filipino managers exercise significantly more control power than their counterparts in both Hong Kong and Singapore, thus confirming Hofstedes earlier findings on what he termed power distance. Journal: Philippine Review of Economics and Business Pages: 97-122 Volume: 35 Issue: 1 Year: 1998 Month: June File-URL: http://pre.econ.upd.edu.ph/index.php/pre/article/view/82/511 File-Format: Application/pdf Handle: RePEc:phs:prejrn:v:35:y:1998:i:1:p:97-122