To encourage enterprises to conduct technology innovation, the government needs to formulate appropriate subsidies policy. This paper compares two R&#x26;D subsidy policies in a supplier-manufacturer supply chain, in which the manufacturer conducts R&#x26;D activity for quality improvement. By means of game theory, we investigate the optimal decisions of the players under the two R&#x26;D subsidy policies, that is, input subsidy policy and product subsidy policy. Finally, we compare the profits and welfare to explore the better R&#x26;D subsidy policy and provide decision support for government to formulate subsidy policy. The results show that under input subsidy policy the optimal production output, quality improvement, profits, government subsidies, and social welfare are all lower than those of product subsidy policy. Therefore, the government should use product subsidy strategy to encourage enterprise R&#x26;D activities.

Zhiying Liu

Qinqin Li

The Government Subsidy Strategy Choice for Firm&#x2019;s R&#x26;D: Input Subsidy or Product Subsidy?

The fishery of the Bay of Bengal (BOB) is assumed to be suffering from the overexploitation. This paper aims to assess the sustainability of current level of fishing effort as well as possible changes driven by anthropogenic and climate driven factors. Therefore, the commercial marine fishery of BOB for the period of 1985/86 to 2007/08 is analyzed by applying Gordon-Schaefer Surplus Production Model on time series of total catch and standardized effort. Static reference points such as open-access equilibrium, maximum economic yield, and maximum sustainable yield are established. Assumptions about potential climatic and anthropogenic effects on <i>r</i> (intrinsic growth rate) and <i>K</i> (carrying capacity) of BOB fishery have been made under three different reference equilibriums. The results showed that the fishery is not biologically overexploited; however, it is predicted to be passing a critical situation, in terms of achieving reference points in the near future. But, on the other hand, economic overfishing started several years before. Higher fishing effort, and inadequate institutional and legal framework have been the major bottlenecks for the proper management of BOB fisheries and these may leads fishery more vulnerable against changing marine realm. Thus, the present study calls for policy intervention to rescue the stock from the existing high fishing pressure that would lead to depletion.

Ahasan Habib

Md. Hadayet Ullah

Nguyen Ngoc Duy

Bioeconomics of Commercial Marine Fisheries of Bay of Bengal: Status and Direction

The inflows of foreign direct investment (FDI) are important for a country's economic development, but the world market for FDI has become more competitive. This paper empirically analyses the exchange rate movements and foreign direct investment (FDI) relationship using annual data on ASEAN economies, that is, Malaysia, the Philippines, Thailand, and Singapore. By employing ARDL bounds test approach, the empirical results show the existence of significant long-run cointegration between exchange rate and FDI for the case of Singapore, Malaysia, and the Philippines with all countries recording negative coefficient implying that the appreciation of Singapore dollar, Malaysian ringgit, and the Philippine peso has a positive impact on FDI inflows. Using the ECM based ARDL approach for causality test, both Singapore and the Philippines show long-run bidirectional causality between exchange rate and FDI whereas long-run unidirectional causality running from the exchange rate to FDI in Malaysia. Furthermore, this study also found that short-run unidirectional causality running from the exchange rate to FDI exists in Singapore.

Jaratin Lily

Mori Kogid

Dullah Mulok

Lim Thien Sang

Rozilee Asid

Exchange Rate Movement and Foreign Direct Investment in Asean Economies

We start this paper by providing a detailed study of how the mean monthly return on the Small-Minus-Big (SMB) Fama-French factor is affected by the January effect and the stock market return during the preceding month and preceding calendar year. We then proceed to building a predictive model for the monthly SMB factor return that incorporates the January effect and the dependence on both the market return during the preceding month and preceding calendar year. Our findings suggest that a positive small stock premium appears mainly during the years following the years with a negative return on the market as the result of a delayed and stronger reaction of small stocks to good news and a stronger January effect. We also argue that the January effect constitutes a much lesser part of the size effect than it was previously supposed.

Valeriy Zakamulin

Predictable Dynamics in the Small Stock Premium

The objective of this paper is to evaluate the impact of high food prices during the 2006&#x2013;2008 food crisis period on the welfare of households in the Sultanate of Oman. The welfare impacts of price changes are estimated using the Hicksian compensating variation (CV) methodology. The compensating variation was estimated for 4 different income household groups as well as two location groups (urban-rural). Results suggest that all household groups suffered welfare losses due to the food crisis. On average, Omani households need to be compensated about 10.3&#x25; of their income for the price increase they experienced during the 2006&#x2013;2008 period. Rural households are more affected than urban households with a required compensation of 12.4&#x25; and 9.87&#x25;, respectively. In all cases most of the impact is felt on the first round where no consumption adjustment is made; the second round effect is comparatively small compared to the first-order effect. Total compensation required to compensate all households amounts to O.R. 266 M, that is, a 1.14&#x25; of GDP, whereas a compensation targeted to the low-income quartile amounts only to O.R. 26.7 M representing 0.1&#x25; of GDP.

Houcine Boughanmi

Ahmed Al Shamakhi

Msafiri Mbaga

Hemesiri Kotagama

Evaluation of the 2006&#x2013;2008 Food Crisis on Household Welfare: The Case of the Sultanate of Oman

The objective of this paper is to present the technical efficiency of individual companies and their respective groups of Bangladesh stock market (i.e., Dhaka Stock Exchange, DSE) by using two risk factors (co-skewness and co-kurtosis) as the additional input variables in the Stochastic Frontier Analysis (SFA). The co-skewness and co-kurtosis are derived from the Higher Moment Capital Asset Pricing Model (H-CAPM). To investigate the contribution of these two factors, two types of technical efficiency are derived: (1) technical efficiency with considering co-skewness and co-kurtosis (WSK) and (2) technical efficiency without considering co-skewness and co-kurtosis (WOSK). By comparing these two types of technical efficiency, it is noticed that the technical efficiency of WSK is higher than the technical efficiency of WOSK for the individual companies and their respective groups. As per available literature in the context Bangladesh stock market, no study has been conducted thus far to measure technical efficiency of companies and their respective groups by using the risk factors which are derived from the H-CAPM. In this research, the link between H-CAPM and SFA is established for measuring technical efficiency and it is believed that the findings of this study may be applied to other emerging stock markets.

Md. Zobaer Hasan

Anton Abdulbasah Kamil

Contribution of Co-Skewness and Co-Kurtosis of the Higher Moment CAPM for Finding the Technical Efficiency

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