Narrow Results

Whether foreign aid promotes or hinders democratic institutions has been debated with opposing views. This paper investigates short- and long-run effects of foreign aid on democratization in post-conflict Cambodia using autoregressive distributed lag bounds testing and Gregory–Hansen structural break testing approach for cointegration over 1980–2015 period. The findings reveal that net bilateral foreign aid per capita, aggregated and classified into purpose-based ‘governance aid’, ‘economic aid’, ‘other aid’ and ‘donor-specific aid’ from the US, EU, France, Australia and Japan, promote long-run democratization. In the short run, only governance and economic aid appear to have a consistent positive effect on democratization.

The Cambodian banking sector has rapidly expanded in recent decades, although there are concerns about the performance of Cambodian banks and the country’s banking sector. A paucity of empirical evidence to clarify the real issues in the banking sector also makes it difficult to formulate effective policy measures to address any potential problems. This study provides empirical evidence by estimating the cost function and efficiencies of 34 commercial banks over the period from 2012 to 2015. We find that the average cost efficiency scores range from 0.60 when measuring bank outputs as loan and deposit amounts, and 0.77 when measuring bank outputs as interest and non-interest income, suggesting that if they are operated more efficiently, they could cut costs by 40% in fund mobilization and 23% in profit making while keeping the same output level. We also find that the Cambodian banks have experienced an improvement in efficiency scores over the period for both aspects of banking activities. Furthermore, we find that expanding a branch network into rural areas is inefficient for bank management, and holding excessive liquidity is associated with higher efficiency, but diversification in bank business operations is negatively associated with cost efficiency of Cambodian commercial banks.

Encouraging informal firms to register with the government is a key policy issue for developing economies. However, the impact of formal registration on firm performance remains inconclusive. This paper constructs a nationally representative panel data set on registered and unregistered establishments in Cambodia by using the Economic Census in 2011 and the Inter-censal Economic Survey in 2014; the Economic Census surveyed all nonfarm establishments and enterprises without any establishment-size threshold, which served as a credible sample frame for the Inter-censal Economic Survey. To mitigate selection bias, I employ a difference-in-differences method combined with propensity-score matching and a propensity-score-weighted regression method. My results show that formalization has a significantly positive impact on sales, value added, and regularly employed workers, but yields little effect on labor productivity. While formal registration alone may not boost productivity, it can encourage the business growth of formalized firms by hiring more formal workers.

In ancient times, Cambodia was home to one of the largest city complexes on earth, Angkor. At its apogee in the 12th century, the whole city of Angkor expanded over $>170$ hectares and had a population of 1–2 million people, which was only equaled by that of Ancient Rome. Angkor subsequently declined but remained occupied until the 18th century, at the beginning of the French protectorate.

In modern times, Cambodia became embedded in the global conflict against the occupying Japanese troops during World War II. This was followed by a lasting war that engulfed the whole Southeast Asia area, but the toll paid by the population remained limited. In the second half of the 20th century, Cambodia suddenly became the site of an acute drama, one of the worst that the world has known since the Holocaust. The Khmer Rouge regime led to the collapse of the whole country’s social system and triggered a brutal rise in mortality—direct and induced—and gender imbalance. Together with increased mortality, which eradicated approximately a third of the country’s population, there was a profound drop in fertility.

The nearly total collapse of the Khmer Rouge regime after Cambodia was freed in 1979 was followed by an important rise in fertility leading to a rebound effect or “baby boom” during the 80s. Today, as in 1960 before the Khmer Rouge drama, global fertility rates in Cambodia are similar to those of its neighbor, Vietnam. Total fertility rates, which neared six children per woman in Vietnam and Cambodia in 1960, have, however, dropped in both countries and stand just at population replacement level.