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Development in Southeast Asia: Empowerment, Policy and Institution

Organiser:
Firdausi Suffian
University of Bristol
firdausi.suffian@bristol.ac.uk

Chair:
Firdausi Suffian
University of Bristol
firdausi.suffian@bristol.ac.uk

Discussant:
Firdausi Suffian
University of Bristol
firdausi.suffian@bristol.ac.uk

 

This panel session will discuss various contemporary ASEAN issues in a broader context of development, namely democracy, empowerment, economic policy and role of institution. Firstly, we will discuss the determinants of democratic preferences in Southeast Asia. In Southeast Asia, democratic practices, preferences and acceptances are differed in many ways. It is said to be grounded to the context-specific of the countries, hence this turn our attention to the assessment of democratic preferences in seven countries of Southeast Asia by examining various conditions through which the society accepts democracy. Secondly, we will view economic policy relating to implementation of minimum wage in Indonesia. Much studies on minimum wage has had impact on wage distribution. We argue that the minimum wage has a positive effect on wage equality but are not distributed evenly in Indonesia. Thirdly, empowering media is an importance source of check-and-balance between state and society. Here, the discussion will be on a theoretical model; to explain how media works in most developing countries. Focusing on Malaysia, it is argued that the state adopted authoritarian and social responsibility model to control contents on mainstream media channels. The model also explains how Internet provides more liberate space for the society to express their supressed opinions. Lastly, we explore Malaysia political economy on industrial development. This analysis will employ institution theory as the ‘rules-of-the-game’ to determine developmental outcome. Assessment of the role of institution and domestic politics is to analyse how domestic politics preferences affect industrial development and stagnation.

 

Paper 1: The Determinants of Preference for Democracy in Southeast Asia

Noory Okthariza
Ohio University
no067713@ohio.edu

Normative preference to democracy should be distinguished from the practical evaluation of the government. The people, despite the fact that they do not live in a democratic country, may favor democracy as an ideal or principles. This paper is aimed at examining the determinants of democratic preference by using seven Southeast Asian countries to contextualize the argument. For the long time, the region has been regarded as diverse and fragmented so that it baffles scholars to conceptualize Southeast Asian politics and society. The fragmented Southeast Asia often perceived as the cause that hinders the practice of democracy in the region. While scholars tend to concur about the vast characteristics across countries in the region, this study shows, when individual perception is taken into account, the majority of Southeast Asian people is convincingly favored for democracy. However, their support should be understood under certain condition, primarily when people evaluate negatively their current countries as well as their family’s economic condition. When Southeast Asians were asked to choose between the intrinsic values of democracy and economic development or between the presence of strong leaders and experts in the government with the expense of not having elections, the people’s view were greatly divided with the majority of them favor for the latter alternatives. This claim implies Southeast Asians do not support democracy for its own purposes, but their support rather subject to the worsening evaluation of their economy. Thus, this paper confirms the broadly accepted idea that the prospect for democracy in the nondemocratic region will hinge on the ability of the state to maintain its legitimacy through a prolonged-satisfactory of economic performance.

 

Paper 2: Minimum Wage and Wage Inequality: The Case of Indonesia

Dandy Rafitrandi
University of Illinois at Urbana-Champaign
rafitra2@illinois.edu

Several studies already have been conducted to reveal the impact of minimum wage policy on wage inequality. Using the gap between state median wages and minimum wages in United States, Lee (1999) conclude that failing of minimum wage has increased wage differentials in 1980. Autor, Manning and Smith (2015) which has expanded time period, also confirmed the same relation with previous studied regarding the effect of minimum wage to wage inequality. This paper will discussed about the significant of minimum wage policy to the wage distribution in Indonesia using National Labor Force Survey (Survey Tenaga Kerja Nasional) data. The objective is to reveal the impact of this policy in different part of wage distributions which have different characteristic and behavior. Methodology in this paper will employ the same specification with Autor, Manning and Smith (2015) – using difference between p-percentile wage and median wage as the measure of wage inequality. Panel data with fixed effect is used to include the regional difference. The minimum wage variable will use the same form with Lee (1999) which is effective minimum wage as a difference between minimum wage and median wage. This study found that the minimum wage has a positive effect on wage distribution for all of percentiles. However, this effects are not distributed evenly among percentiles in the wage distribution

 

Paper 3: Media system – how it works in developing countries? A theoretical framework: case of Malaysia

Nuurrianti Jalli
Ohio University
nj617911@ohio.edu

Media ownership around the world is restricted to several principle sources depending on the country’s political system and also at the same time, its level of economic development. In many developing countries, media system is often controlled by the ruling power (Sriramesh & Vercic, 2003). Although media is often referred as one of the most important elements in democratic process, where it plays key role to monitor and investigating events happening in the country, and has the responsibility to report and inform the public about it, however, media system is not immune to manipulation. In this paper, the researcher proposed a general theoretical framework that can help to explain how media system works in most developing countries. Based on this constructed framework, contents on mainstream media in countries like Malaysia (where the government controls all mainstream media channels) would have to go through layers of rigorous processes before finally broadcasted and published on national public sphere. Using historical research method and utilizing secondary data as primary sources, the researcher found that most of the developing countries adopted either or both of these media selection models, 1) authoritarian model and 2) social responsibility model to govern content selection in their country. Also, through this theoretical framework, we will be able to see the process of how the people create an alternate public sphere on the Internet to express their opinions.

 

Paper 4: Malaysia political economy on industrial development: The Role of Institution and Domestic Politics

Firdausi Suffian
University of Bristol
firdausi.suffian@bristol.ac.uk

Institution plays important role to determine industrial growth and her decline. Institution matter because it mediates the state and economic actors’ interest, also it shapes, facilitate and constraints interaction between those actors in economic exchange. More importantly, institution constructs the ‘rules-of-the-game’ to determine developmental outcome. Most institutional scholars argue that strong institution that is, clear enforcement formal rules and policy by the states to enable market to operate efficiently is crucial to bring economic development, however this views has been challenged by the growth Southeast Asia over the past few decades that features a weak institution. Here, a weak institution refers to the states coordinate economic resources and direct industrialisation, this is similar to East Asia countries during the early industrialisation period. However, if state-backed industrialisation like East Asia countries can bring high-level industrial development but why most Southeast Asia countries can only attain moderate growth? Much of the current literature have pointed out that this region unable to ‘graduate’ into more capital-intensive activities thus locked in low value-added manufacturing activities. This paper will explore Malaysia political economy as a late industrialiser, focuses on the role of the institutions and domestic politics that influences industrial development. The assessment includes how domestic class formation affects institutional arrangement in relation to industrial development. Also, due to weak presence of industrial class, the state elites’ push the institutional arrangement in a way to focus on non-manufacturing sectors. This is to accommodate the domestic politics preferences, which eventually lead to premature de-industrialisation.