This is to clarify certain issues raised against the Philippine Institute for Development Studies (PIDS) in connection with the 2013 Annual Audit Report of the Commission on Audit (COA), and published in the newspapers and online news web sites today.
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HOW SHOULD INCOME-BASED GRANTEES IN TERTIARY EDUCATION BE CHOSEN?
Helping poor but deserving students get a college degree is one way to break the cycle of poverty. The question, however, is how these scholars should be chosen. This Policy Note draws some insights from the PIDS research on the Students Grants-in-Aid Program for Poverty Alleviation (SGP-PA) implemented by the Commission on Higher Education and Department of Social Welfare and Development. The SGP-PA supports students unable to afford tertiary education. The programs objective is to increase the number of higher education graduates among poor households and employ these graduates in high value-added occupations. || Read more >>
12TH DPRM ADVOCATES LABOR, INDUSTRIAL REFORMS FOR INCLUSIVE GROWTH
This issue of the Development Research News mainly features the observance of the 12th Development Policy Research Month which the Institute spearheads in September each year. The theme for this year, "Addressing the Jobs Challenge Toward Inclusive Growth", highlights the need for labor and industrial reforms for inclusive growth. It underscores the effect of labor policies such as the minimum wage-setting, the lack of more productive jobs, and issues in the education sector that have further contributed to persistent poverty and inequality. Several articles deal with these important issues, including the recommendations from the PIDS study on "Labor Policy Analysis for Jobs Expansion and Development" that advocates for a 12-point agenda to address the jobs challenge. || Read more >>
THE NEED (OR NOT) FOR FISCAL INCENTIVES
Fiscal incentives are one of the instruments in a country`s development and investment promotion strategies. In the Philippines, the bill on the rationalization of fiscal incentives for investments to further shore up government collections has been certified a priority measure by the Aquino administration. This bill aims to rationalize fiscal incentives across industries to improve transparency, further bolster revenues, and level the playing field. This Policy Note examines two Senate bills being proposed to provide significant improvements to the current fiscal incentive regime in the country. || Read more >>
MINIMUM WAGE: SHOULD IT BE THE WEAPON OF CHOICE FOR INCLUSIVE GROWTH?
The minimum wage is a classic example of a price floor, the lowest price set by law with which to pay a commodity. The idea is to prevent wages from going too low. Historically, societies have used the minimum wage to achieve their social justice objectives. Internationally, there is no consensus on the effect of minimum wages on employment. In the Philippines, a study by Lanzona (2014) established a negative relationship between minimum wages and employment. Paqueo et al. (2014) meanwhile challenges the idea minimum wages and other labor regulations should be the "weapons of choice". Other alternatives such as better education, increased labor-intensive manufacturing of tradable goods, and greater opportunities for training on the job should be considered. || Read more >>
CLARIFYING THE JOBS CHALLENGE
The jobs challenge is not simply the lack of job opportunities. A more nuanced view is the inability of the common person to earn a decent living through productive employment or self-employment. Viewing the issue as such reveals the other dimensions of the lack of job opportunities issue. This Policy Note clarifies the jobs challenge and its implications for policy based on Paqueo et al. (2014). Defining clearly the jobs challenge illuminates the issue much more clearly and highlights the weakness of viewing it as simply a problem of lack of job opportunities. The Note argues that the jobs challenge extends beyond those who are currently unemployed. It should include those who are currently employed but are earning below subsistence. These workers require much more than just having and keeping their jobs. Finally, there are those who are earning beyond subsistence but for whatever reason still want to work more hours. || Read more >>
IS GROWTH REALLY JOBLESS?
The stellar economic growth in the country since 2012 has not been subsequently accompanied by a significant reduction in poverty or by increased employment. Is the country`s economic growth really jobless? The description about the Philippine economy being jobless stems from the seeming divergence in growth between economic growth and employment. This Policy Note examines whether or not it is fair to characterize the country`s economy as having jobless growth and discusses related issues. The development community suggests the government to focus its efforts on further accelerating structural reforms to facilitate sustained and inclusive growth and development, which will create jobs and reduce poverty. || Read more >>
EFFECTS OF MINIMUM WAGE ON THE PHILIPPINE ECONOMY
This Policy Note presents the results of a study that explores the effects of labor policies on the industry. In particular, it examines the minimum wage policy by disentangling and controlling various factors that may confound the effects of minimum wages on employment. Using various econometric methods, the study finds that the minimum wage policy reduces employment in small firms. It causes small firms to reduce their production workers. Furthermore, because of the minimum wages, firms are reluctant to hire younger, less educated, and female production workers. To minimize costs, increasing training for these younger and less educated production workers may no longer be an option as minimum wages rise. These findings may have serious consequences in the way the Labor Code affects production efficiency, as well as social protection. There is thus a need to coordinate these policy areas in a way that reinforces one another. || Read more >>
ECONOMIC POLICY MONITOR 2013: ADDRESSING THE JOBS CHALLENGE TOWARD INCLUSIVE GROWTH
This fourth issue of the PIDS Economic Policy Monitor (EPM) focuses on the need to pursue inclusive growth through the expansion of quality job opportunities. It revisits the jobs issue and provides recommendations on how to address it, taking into consideration the socioeconomic and political landscape and historical experience of the Philippines. The theme chapter looks into the causes of the economy`s failure to generate substantial and quality job opportunities by examining the effectiveness of minimum wage and other labor regulations to determine if they are growth and welfare enhancing. The study finds that raising the minimum wage reduces employment in smaller firms, lowers household income, and increases the probability of falling into poverty. Along with recommendations for a minimum wage reform, expansion of gainful job opportunities from the labor-intensive manufacturing sector, and greater investments in education and other human development aspects, the study proposes a 12-point agenda called "Job Expansion and Development Initiatives" or JEDI. || Read more >>
REGIONAL INTEGRATION, INCLUSIVE GROWTH, AND POVERTY: ENHANCING EMPLOYMENT OPPORTUNITIES FOR THE POOR
Regional economic integration in East Asia is characterized initially as a market-driven process of increased trade and foreign direct investment inflows, and eventually by formal arrangements to liberalize trade and integrate economic activities through free trade agreements among East and Southeast Asian countries. This has led to more intensified regional production networks in which East and Southeast Asian countries, including the Philippines, participated. Set against the backdrop of continuing economic integration in the region, economic growth in the Philippines has not been as inclusive as in the other countries as manifested in the increase in the magnitude of poverty incidence. This paper examines how the Philippines can improve its record on poverty reduction by looking at how it can generate greater demand for the labor services of the poor. Specifically, this paper looks into the linkage between regional production networks and inclusive growth in the Philippines through employment generation for the poor. || Read more >>
Inclusivity remains a critical challenge for the Philippines. Despite an outstanding growth performance in 2013, widespread poverty and joblessness persist - signs that growth continues to benefit only a few. Three million Filipinos were without jobs in 2013 and 7.51 million were underemployed. By 2012, the proportion of the population living below poverty line was 25.2 percent.
The Philippine Development Plan 2011-2016 recommends a number of strategies to enhance job generation, which include, among others, opening legitimate channels for all forms of employment and mutually beneficial work arrangements, and exploiting the country's comparative advantage in labor-intensive activities. In support of the PDP, the 12th Development Policy Research Month (DPRM) has for its theme, "Addressing the Jobs Challenge toward Inclusive Growth", to give emphasis to the urgent need to address the perennially high rates of unemployment and underemployment in the country.
With the Philippines in the cusp of major international and regional developments such as the forthcoming ASEAN economy community in 2015, it is high time that we take a look at labor policies and regulations and other binding constraints that hamper the country's ability to generate ample and productive jobs and make use of its abundant resources.
We should determine what policy measures and interventions can make a serious dent on high income inequality and poverty incidence.
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The number of children living in poverty in the Philippines continues to climb despite the country`s recent economic gains.
According to a study titled `Child Poverty in the Philippines` by state think tank Philippine Institute for Development Studies (PIDS), there were already about 13.4 million Filipino children living in poverty in 2009.
`This number represents 36 percent or more than one-third of all Filipino children aged below 18. Being poor, they suffer from deprivat || Read more >>
There`s a glimmer of hope for inclusive growth with the government taking steps particularly in the area of labor and industrial policy as well as human capital development.
PIDS President Gilberto Llanto made this assessment Tuesday (September 23, 2014) as he wrapped up the 12th Development Policy Research Month (DPRM) Seminar that tackled labor policy reforms, the revival of the manufacturing industry, and issues in the educational sector. The seminar was the highlig || Read more >>
The effects of labor regulations such as the minimum wage policy should be considered if government is really serious about creating jobs and pursuing inclusive growth.
This was stressed by Dr. Vicente Paqueo, visiting research fellow of state think-tank Philippine Institute for Development Studies (PIDS), in a forum at the Senate on September 18 organized by the Senate Economic Planning Office and PIDS. The forum is part of the nationwide celebration of the 12th Development || Read more >>
Despite rapid economic growth in the past years, poverty still persists in the Philippines. Investing in development programs such as the Pantawid Pamilyang Pilipino Program (4Ps) is thus crucial to delivering better social outcomes. As the flagship anti-poverty program of the country, the conditional cash transfer scheme has been met with some criticisms. Some sectors see it as a dole-out that breeds mendicancy. Supporters, however, argue that the program comes with conditio || Read more >>
Economists from the Philippine Institute for Development Studies (PIDS) and the University of the Philippines (UP) took turns discussing techniques in impact evaluation at the IEmatters pre-conference workshops, providing development practitioners with the means to generate evidence that will influence policy.
PIDS Senior Research Fellow Aniceto Orbeta on Tuesday (Sept. 2, 2014) gave an overview of regression discontinuity and interrupted time series designs, which exploit || Read more >>