Could foreign exchange rate adjustments in consumers’ monthly bill have been avoided? Should government prohibit utility companies from charging foreign exchange rate adjustments?
There are many reasons for the relative backwardness of Philippine agriculture and rural economy. Some of them are acts of God like typhoons. Some are failures of the Philippine state such as the lack of
irrigation and rural infrastructure. Others are failures of well.
Some quarters argue that the Bureau of Internal Revenue (BIR) Commissioner lacks the necessary instruments to discipline erring and
inefficient personnel, thus the urgent need to restructure the agency.
But the notion that the BIR Commissioner is helpless against incompetent subordinates is baseless. There are two principal management functions available to the government that should allow for the effective running of the BIR – the power of control and supervision, and the power of administrative discipline.
There is a beautiful theorem in Economics called the “Coase Theorem” by Nobel Prize winner Ronald Coase. It says that the redistribution of assets for equity’s sake should not prejudice economic efficiency as long as those assets can be traded in the market.
Comprehensive Agrarian Reform Law (CARL) was passed to redistribute land from landowners to tenants. But it outlaws the market for land. It thus violates the second part of Coase Theorem and puts equity squarely at loggerheads with efficiency. The offending provision is Section 27, which prohibits the sale, transfer or conveyance – apart from inheritance of acquired lands – for 10 years. In practice, even beyond 10 years, legal land transactions are still prohibited until the land has been fully repaid by beneficiaries.
Development economics emerged in the late 1940s and 1950s as a Third World was forming from the shambles of disintegrating colonial empires. Its pioneers were independent scholars who addressed the problem of “underdevelopment” from respective experiences, regions and intellectual formations. The 19th-century late industrializers, Soviet economic planning, and the management of the British war economy were among the historical experiences that informed their work.
A significant development that demands wider public dissemination is
the revival of the discourse on the issue of financial integration, involving highly influential institutions and personalities. A paper from the International Monetary Fund (IMF) discusses this topic, titled Effects of Financial Globalization on Developing Countries: Some Empirical Evidence, dated 17 March 2003 and authored by Eswar Prasad, Kenneth Rogoff, Shang-Jin Wei, and M. Ayhan Kose. For those who are very critical of the IMF, this paper may turn out to be a surprise, and a pleasant one at that.