This investigation proposes a conceptual framework for measurement necessary for an analysis of household finance and economic development. The authors build on and, where appropriate, modify corporate financial accounts to create balance sheets, income statements, and statements of cash flows for households in developing countries, using an integrated household survey. The authors also illustrate how to apply the accounts to an analysis of household finance that includes productivity of household enterprises, capital structure, liquidity, financing, and portfolio management. The conceptualization of this analysis has important implications for measurement, questionnaire design, the modeling of household decisions, and the analysis of panel data.

We present a framework for the study of risk and return of household enterprise in developing economies. We make predictions from two polar benchmarks: (1) an economy with Pareto optimal allocations under full risk sharing, and (2) an economy in which each autarky household absorbs risk in isolation. The full risk-sharing benchmark delivers the prediction that only aggregate covariate risk contributes to the risk premium of asset returns while idiosyncratic risk is fully diversified, consistent with analogous results derived from the Capital Asset Pricing Model (CAPM) in the finance literature. The economy with autarky households predicts that overall fluctuation at the household level is the only concern. Our framework allows us to empirically decompose the total risk in production technologies operated by households into aggregate and idiosyncratic components and provides us with a practical procedure to compute risk premium for each component separately. We apply the framework to monthly panel data from a household survey in rural Thailand where there are active risk-sharing and kinship networks. We find that there is nontrivial aggregate risk and there is a positive relationship between the expected returns on assets and the comovement of asset returns with the aggregate returns, as predicted by the full risk-sharing economy. There is residual idiosyncratic risk and it also contributes to the total risk premium, as predicted by the autarky benchmark. However, although idiosyncratic risk is the dominant factor in total risk, our study shows that it accounts for a much smaller share of total risk premium. Exposure to aggregate and idiosyncratic risk is heterogeneous across households as are the corresponding risk-adjusted returns, with important implications for vulnerability and productivity.

Large private enterprises in the ASEAN-5 economies have been, and remain, dominated by firms that share four common characteristics: (1) their ownership and control are concentrated among a handful of prominent business families; (2) most of these families have Chinese origins; (3) each family owns a collection of legally distinct firms that collectively form a business group; and (4) the owning families have formed extensive connections with politicians and bureaucrats. These characteristics reflect how family businesses have responded to the changing political and economic situations in the region over the past century -- the process that shapes the landscape of the modern corporate sector in the ASEAN-5 economies that we observe today.

This paper uses civil conflicts in Southeast Asia to illustrate the economic causes and consequences of the conflicts on the economy. It argues that the causes of conflicts in this region are consistent with what predicted by theories that link economic growth and inequality to the motives and opportunity costs of civil unrests. The chapter discusses the economic impacts of civil conflicts on physical capital, natural capital, human capital, and total factor productivity, as well as arguing that the effects could persist in the long run.

State owned enterprises (SOEs) are a pervasive form of firms across most economies in Southeast Asia. Their historical origin, development, and performance are diverse but reflects political and economic development in each country. Conforming with predictions from economic literature, SOEs in Southeast Asia are largely inefficient. Given the political economy behind their existence, reforms and privatization have proceeded slowly. The pervasiveness of SOEs in turn accounts for the low productivity of the aggregate economy, not only because they are inefficient, but also because they crowd out resources that would be available to more efficient private firms. That being said, Southeast Asia is also home to a notable exception: Singapore, a market-oriented economy dominated by highly efficient and profitable state owned enterprises.

There are surprisingly few estimates of the effects of sales taxes on retail prices, especially at the firm level. We consider the temporary suspension, and subsequent reinstatement, of the gasoline sales tax in Illinois and Indiana following a price spike in 2000. Earlier laws set the timing of the reinstatements, providing plausibly exogenous changes in the tax rates. Using a unique dataset of daily prices at the gas-station level, 70% of the tax suspension is passed on to consumers in the form of lower prices, while 80-100% of the tax reinstatements are passed on to consumers. Some evidence suggests that these short-run pass-through estimates are smaller near the state borders, with the tax reinstatements associated with relatively higher prices up to an hour's drive into neighboring states.

This paper explores episodes of financial crises and recessions experienced by the economies in Southeast Asia: the global debt crisis and the commodity price collapse in the 1980s, the Asian financial crisis in the 1990s, and the burst of the dot-com bubble and the global financial crisis in the 2000s. These crises highlight one common feature of the economies in Southeast Asia: due to its outward-oriented development strategy, these economies have become highly integrated and more exposed to the world economy, making them very vulnerable to events happening in the global economy. The severity of the crises however depended on how domestic governments responded to such external shocks.