JC Punongbayan

JC Punongbayan

he/him

Filipino economist and academic.

Publications

You can also find my articles on my Google Scholar profile.

Journal articles

Political budget cycles in the Philippines: Evidence from subnational fiscal data

Published in Public Finance Review, 2026

Abstract This paper documents patterns consistent with political budget cycles in the Philippines using provincial fiscal data from the Bureau of Local Government Finance for 81 provinces from 2012 to 2022, spanning four local elections. We examine how the level and composition of government spending, as well as provincial fund balances, change in the year preceding elections. Using fixed effects and restricted-instrument dynamic panel GMM estimates, with the CPI interaction evaluated at the sample-mean CPI, we find a positive total-spending association in difference GMM and positive fixed-effects associations for education spending and capital outlay. The evidence does not support pre-election increases in social welfare spending or fund balances. These findings provide qualified subnational evidence consistent with political budget cycle incentives while highlighting the additional political variation required for causal tests.

Recommended citation: Sacluti, S.D.V., K.A.B. Saturnino, and J.C.B. Punongbayan (2026). "Political budget cycles in the Philippines: Evidence from subnational fiscal data." Public Finance Review.
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Debt, dictatorship, and decline: The enduring economic impact of the Philippines’ 1980s crisis

Published in Review of Development Economics, 2026

Abstract One of the enduring economic puzzles in East Asia is the Philippines' lagging economic performance since the late 20th century. This paper examines the long-run consequences of the country's sovereign debt crisis in the early 1980s—a unique event in East Asia at the time, triggered by a combination of adverse global shocks and domestic policy failures under the dictatorship of Ferdinand E. Marcos (1972–1986). We test the hypothesis that this crisis caused a lasting negative shock to the Philippines' growth trajectory. Using the synthetic control method, we find that from 1981 to 2019, annual synthetic GDP exceeded actual GDP by an average of 110%, suggesting a permanent downward shift in economic trajectory. We validate these findings with a range of placebo tests. Overall, the results highlight the extreme extent to which a severe debt crisis—caused and amplified by authoritarian economic mismanagement—can cast a long shadow over a developing country's subsequent growth trajectory.

Recommended citation: Punongbayan, J.C.B. and E.S. de Dios (2026). "Debt, dictatorship, and decline: The enduring economic impact of the Philippines’ 1980s crisis." Review of Development Economics 30(2): 1418–1429.
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Supply and demand components of Philippine inflation (2001–2024)

Published in Applied Economics Letters, 2025

Abstract This paper decomposes Philippine inflation into supply and demand components, inspired by recently developed methods. Using Philippine household consumption data, I use a VAR model to distinguish supply-driven from demand-driven inflation from 2001 to 2024. Findings show the predominance of supply-driven components of inflation during key episodes, including the 2008, 2018, and 2022 inflation spikes. The results also suggest that the supply-driven component of inflation responds more to shocks like oil price shocks and even monetary policy shocks from abroad. The study highlights the role of supply-focused policies during times of high inflation, and the role of relatively simple inflation decompositions in monitoring inflation dynamics.

Recommended citation: Punongbayan, J.C.B. (2025). "Supply and demand components of Philippine inflation (2001–2024)." Applied Economics Letters, 1–7.
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The Philippine Journal of Development in the early 21st century (2002–2023)

Published in Philippine Journal of Development, 2024

Abstract The Philippine Journal of Development (PJD), which marks its 50th year in 2024, has been a key platform for economic policy research in the Philippines. This paper reviews all PJD articles from 2002 to 2023, focusing on trends in topics, authorship, and methodologies. Most articles covered international economics, agriculture, health, and public economics, with contributions mainly from Filipino and multidisciplinary authors. Despite its achievements, the PJD struggles with low visibility and impact, lagging in citations and missing from major journal indexes like Scopus. To address these gaps, the journal could pivot toward more timely and urgent development topics, such as education and climate change, and adopt modern methods like those in the “credibility revolution”. More regular publication and broader engagement with the public (e.g., through social media) can also enhance the PJD’s relevance and impact. These steps will help position the PJD as a premier outlet for policy-relevant research, fostering its growth and influence in the coming decades.

Recommended citation: Punongbayan, J.C.B. (2024). "The Philippine Journal of Development in the early 21st century (2002–2023)." Philippine Journal of Development 48(2): 1–24.
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Balancing excellence and equity in predictive college admissions: Insights from the University of the Philippines

Published in Education Economics, 2024

Abstract The University of the Philippines (UP) uses high school grades and standardized test scores for predictive admissions, balancing academic performance with affirmative action for underprivileged applicants. Using a novel UP panel dataset, I find that high school grades better predict academic performance, while entrance exam scores reflect background characteristics. Simulations suggest that reducing the weight of standardized exams boosts the qualification rates for public and private school students, but lowers it for science high schools and Metro Manila students. The findings indicate that relying more on grades could enhance both excellence and equity in college admissions.

Recommended citation: Punongbayan, J.C.B. (2024). "Balancing excellence and equity in predictive college admissions: Insights from the University of the Philippines." Education Economics, 33(5): 794–817.
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Conversations with social scientists: Economist Emmanuel S. de Dios, PhD

Published in Social Science Diliman, 2024

Abstract This long-form interview with economist Emmanuel S. de Dios explores the intellectual foundations and evolution of his scholarship in economics and political economy. Through a reflective and candid conversation, de Dios discusses his early influences, engagement with Marxian thought, perspectives on institutional reform and democratic governance, and his approach to mentoring the next generation of Filipino economists. The interview offers insights into the role of critical thinking, interdisciplinarity, and historical awareness in shaping both academic work and public discourse in the Philippines.

Recommended citation: Punongbayan, J.C.B. (2024). "Conversations with social scientists: Economist Emmanuel S. de Dios, PhD." Social Science Diliman 19(1): 92–101.
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The role of power prices in structural transformation: Evidence from the Philippines

Published in Journal of Asian Economics, 2019

Abstract The Philippines provides an extreme example of Rodrik’s observation that late developing countries experience deindustrialization at lower levels of per capita income than more advanced economies. Previous studies point to the role of protectionist policies, financial crises, and currency overvaluation as explanations for the shrinking share of the industry sector. We complement this literature by examining the role of power prices in the trajectory of industry share. We make use of data at the country level for 33 countries over the period 1980–2014 and at the Philippine regional level for 16 regions over the period 1990–2014. We find that higher power prices tend to amplify deindustrialization, causing industry share to turn downward at a lower peak and a lower per capita income, and to decline more steeply than otherwise. In a two-country comparison, we find that power intensive manufacturing subsectors have expanded more rapidly in Indonesia, where power prices have been low, whereas Philippine manufacturing has shifted toward less power intensive and more labor intensive subsectors in the face of high power prices.

Recommended citation: Ravago, M.V., A.Z. Brucal, J. Roumasset, and J.C.B. Punongbayan (2019). "The role of power prices in structural transformation: Evidence from the Philippines." Journal of Asian Economics 61: 20–33.
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School inputs and student performance in public elementary schools in Palawan: A quantile regression analysis

Published in Philippine Review of Economics, 2009

Abstract This study investigates the role of school resources in different measures of student performance in public elementary schools in the province of Palawan. We contend that it is not enough to identify which school resources matter the most, but that it would be more informative for policy purposes to identify which student types may benefit the most from the provision of a given school resource. This way, we may be able to target our allocations toward more productive educational investments. Using quantile regression analysis, we find that in the case of Palawan, improvements in pupil-teacher and pupil-toilet ratios may benefit high-performing schools the most. We also find that class size and pupil-room ratio improvements, along with the provision of guidance counselors and science laboratories, may benefit low-performing schools the most. Our results also give some evidence that conventional ordinary least squares (OLS) procedures may be both insufficient and imprecise in estimating education production functions, and that educational policies based on least squares methods alone may be misguided if not accompanied by other techniques, such as quantile regression, which can offer more valuable insights into education production processes in general.

Recommended citation: Punongbayan, J.C.B. (2009). "School inputs and student performance in public elementary schools in Palawan: A quantile regression analysis." Philippine Review of Economics 46(1): 189-219.
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Books

Twin plagues: How Duterte and Covid-19 wrecked the Philippine economy

Published in 2026

Abstract This book chronicles the Philippine economy under Rodrigo Duterte’s presidency from 2016 to 2022, a period marked by authoritarian populism and the devastation of the Covid-19 pandemic. Drawing on economic data, policy analysis, and contemporary reporting, the book argues that weak governance and institutional erosion had already undermined economic performance well before the pandemic. The pandemic then exposed and magnified these failures, culminating in the country’s worst postwar recession and the deepest economic contraction in Southeast Asia. The book challenges the persistent but misleading narrative that Duterte handled the economy well, offering an economic counterpoint to a literature that has largely emphasized the war on drugs, media repression, and foreign policy. Written in an accessible style, Twin Plagues is both an economic history and a cautionary tale about how authoritarian populism can rapidly corrode governance and inflict lasting damage on developing economies.

Recommended citation: Punongbayan, J.C.B. (2026). Twin plagues: How Duterte and Covid-19 wrecked the Philippine economy. Singapore: Penguin Random House Southeast Asia
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False nostalgia: The Marcos “golden age” myths and how to debunk them

Published in 2023

Abstract This book interrogates the persistent myth of a “golden age” during the Marcos dictatorship in the Philippines, using data, history, and economic analysis to dismantle the false narratives of prosperity, peace, and progress under martial law. Drawing from academic research, primary sources, and public discourse, False Nostalgia exposes how the Marcos regime’s policies led to economic decline, massive debt, cronyism, and widespread human rights abuses. Written in an accessible style, it equips readers—especially young Filipinos—with the tools to critically evaluate historical revisionism and to guard against authoritarian nostalgia in the digital age.

Recommended citation: Punongbayan, J.C.B. (2023). False nostalgia: The Marcos “golden age” myths and how to debunk them. Quezon City: Ateneo de Manila University Press
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Book chapters

Counterfactuals in economics and allied social sciences: Methods, applications, and debates

Published in Reference Module in Social Sciences, 2025

Abstract Empirical economics has been transformed by the “credibility revolution”, which centers on the principle that credible causal claims require well-designed strategies for constructing valid counterfactuals. This chapter explores how counterfactual thinking and quasi-experimental methods have transformed applied microeconomics, macroeconomics, economic history, and the broader social sciences. It examines the toolkit of modern causal inference, including randomized controlled trials, difference-in-differences, and synthetic control methods, and discusses their strengths and limitations. The chapter concludes by addressing key challenges, such as model dependence and external validity.

Recommended citation: Punongbayan, J.C.B. and A.R. Paloyo (2025). Counterfactuals in economics and allied social sciences: Methods, applications, and debates. In Reference Module in Social Sciences. Elsevier.
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Much a Duterte about nothing: Continuity, complacency, and crisis in the Philippine economy (2016–23)

Published in Games, changes, and fears: the Philippines from Duterte to Marcos, 2024

Abstract In 2016, President Rodrigo Duterte inherited an economy with years of steady growth, low inflation, a lower debt burden, an influx of investments, and robust consumer and business confidence. In some ways, the Duterte administration (2016–22) kept that momentum. But this period also saw the reversal of some of these beneficial macroeconomic outcomes, as evidenced by slowing growth, a spell of high inflation, the steady decline of foreign direct investments, and the deep recession wrought by the pandemic (exacerbated by Duterte’s inept pandemic response). The subsequent Marcos Jr. administration will have to contend with the deep economic scars left by the pandemic. But early signals suggest that Marcos Jr. is more interested in efforts to rehabilitate his family’s image and rehash old programmes and policies of the late dictator, Marcos Sr.

Recommended citation: Punongbayan, J.C.B. (2024). Much a Duterte about nothing: Continuity, complacency, and crisis in the Philippine economy (2016–23). In A. Arugay and J. Encinas-Franco (Eds.), Games, changes, and fears: the Philippines from Duterte to Marcos (pp. 33–58). ISEAS Yusof-Ishak Institute.
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Martial law and the Philippine economy

Published in The Marcos years: The age of crisis and repression, 2023

Abstract This article provides a concise review of the economic performance during the period of the Marcos dictatorship (1972–1985) from a comparative historical perspective. We examine the external events and internal policy responses that made possible the high growth in the early years of martial law and show that these are integral to explaining the decline and ultimate collapse of the economy in 1984–1985. The macroeconomic, trade, and debt policies pursued by the Marcos regime—particularly its failure to shift the country onto a sustainable growth path—are explained in the context of the regime’s larger political-economic programme of holding on to power and seeking rents.

Recommended citation: De Dios, E.S., M.S. Gochoco-Bautista, J.C.B. Punongbayan (2023). Martial law and the Philippine economy. In F. Llanes (Ed.), The Marcos years: The age of crisis and repression (pp. 217–294). SAMASA Alumni Association.
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Regulation, market evolution and competition in the Philippine microfinance sector

Published in Pro-poor development policies: lessons from the Philippines and East Asia, 2022

Recommended citation: Punongbayan, J.C.B., E.F. Esguerra, and G.M. Llanto (2022). "Regulation, market evolution and competition in the Philippine microfinance sector." In H. Hill, M.V. Ravago, and J.A. Roumasset (eds.) Pro-poor development policies: lessons from the Philippines and East Asia (pp. 595–632). Singapore: ISEAS–Yusof Ishak Institute.
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Convergence of Philippine spatial inequality during the American colonial period

Published in Pro-poor development policies: lessons from the Philippines and East Asia, 2022

Recommended citation: Punongbayan, J.C.B., J.G. Williamson, and K.L. Jandoc (2022). "Convergence of Philippine spatial inequality during the American colonial period." In H. Hill, M.V. Ravago, and J.A. Roumasset (eds.) Pro-poor development policies: lessons from the Philippines and East Asia (pp. 390–413). Singapore: ISEAS–Yusof Ishak Institute.
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Discussion papers

Rejoinder

Published in UP School of Economics Discussion Paper Series, 2024

Recommended citation: Monsod, T.C., E.S. De Dios, C.D. Magno, J.C.B. Punongbayan, et al. (2024). "Rejoinder." UPSE Discussion Paper No. 2024-01b.
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Policy notes and briefs