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  • Author: Arvind Subramanian, Aaditya Mattoo
  • Publication Date: 12-2011
  • Content Type: Working Paper
  • Institution: Center for Global Development
  • Abstract: Until recently, the World Trade Organization (WTO) has been an effective framework for cooperation because it has continually adapted to changing economic realities. The current Doha Agenda is an aberration because it does not reflect one of the biggest shifts in the international economic and trading system: the rise of China. Even though China will have a stake in maintaining trade openness, an initiative that builds on but redefines the Doha Agenda would anchor China more fully in the multilateral trading system. Such an initiative would have two pillars. First, a new negotiating agenda that would include the major issues of interest to China and its trading partners, and thus unleash the powerful reciprocal liberalization mechanism that has driven the WTO process to previous successes. Second, new restraints on bilateralism and regionalism that would help preserve incentives for maintaining the current broad non-discriminatory trading order.
  • Topic: Economics, Industrial Policy, International Trade and Finance
  • Political Geography: China, Israel, Asia
  • Author: Daniel Gros, Felix Roth
  • Publication Date: 12-2011
  • Content Type: Working Paper
  • Institution: Centre for European Policy Studies
  • Abstract: This paper analyses public support for the euro in Germany. Drawing from the results of regular Eurobarometer surveys, it finds that the ongoing financial and sovereign debt crisis has reduced support for the euro among German citizens, but not dramatically so – at least not yet. In the 1990s, the German public was sceptical towards the euro. But since the introduction of euro banknotes and coins, a clear majority of citizens supports the euro – despite the financial and sovereign debt crisis. Moreover, on average, support for the euro is at a similar level in Germany as it is elsewhere in the euro area.
  • Topic: Economics, Regional Cooperation, Monetary Policy, Financial Crisis
  • Political Geography: Europe, Germany
  • Author: Felix Roth, Felicitas Nowak-Lehmann D., Lars Jonung
  • Publication Date: 11-2011
  • Content Type: Working Paper
  • Institution: Centre for European Policy Studies
  • Abstract: This paper analyses the evolution of public support for the euro from 1990 to 2011, using a popularity function approach, focusing on the most recent period of the financial and sovereign debt crisis. Exploring a huge database of close to half a million observations covering the 12 original euro area member countries, we find that the ongoing crisis has only marginally reduced citizens' support for the euro – at least so far. This result is in stark contrast to the sharp fall in public trust in the European Central Bank. We conclude that the crisis has hardly dented popular support for the euro while the central bank supplying the single currency has lost sharply in public trust. Thus, the euro appears to have established a credibility of its own – separate from the institutional framework behind the euro.
  • Topic: Economics, Regional Cooperation, Financial Crisis
  • Political Geography: Europe
  • Author: Anna-Elisabeth Thum, Miroslav Beblavý, Marcela Veselkova
  • Publication Date: 12-2011
  • Content Type: Working Paper
  • Institution: Centre for European Policy Studies
  • Abstract: In this Working Document we look at which OECD countries deliberately attempt to reproduce social stratification through educational policies, and which countries put greater emphasis on intervening in the stratification process. First, we examine the relationship between education and welfare policies as measures of intervention in this process: do countries intervene in both education and welfare – driven by a 'stratification culture'? Or is there a trade-off between intervention in education and welfare, with certain countries prioritising one over the other?
  • Topic: Economics, Education, Poverty, Social Stratification
  • Author: Indianna D. Minto-Coy
  • Publication Date: 12-2011
  • Content Type: Working Paper
  • Institution: Centre for International Governance Innovation
  • Abstract: The effects of the ongoing global financial crisis have intensified the existing economic issues facing the Commonwealth Caribbean, including declining investment, productivity levels and employment opportunities for its citizens. Although the current crisis presents challenges for governments in the region, it also offers an opportunity for these countries to implement innovative solutions to contend with the short-term effects of the financial crisis, while addressing long-standing problems. A solution that has been successful in Botswana, Ireland and Barbados, is the use of social partnerships. Undertaken while these countries were facing economic and social crises, social partnership as a specific governance model allowed them to achieve levels of development and stability that other states yearn to attain.
  • Topic: Development, Economics, Labor Issues, Foreign Direct Investment, Financial Crisis, Governance
  • Political Geography: Caribbean
  • Author: Paul R. Masson
  • Publication Date: 12-2011
  • Content Type: Working Paper
  • Institution: Centre for International Governance Innovation
  • Abstract: The independence of the European Central Bank (ECB), seemingly guaranteed by its statutes, is presently under attack. The ECB has been led to acquire large amounts of government debt of the weaker euro zone members, both to help contain their interest costs and to help protect the solvency of banks throughout the zone that hold their debt. This paper presents a model of a dependent central bank that internalizes the government's budget constraint. Using a Barro-Gordon framework, the model embodies both the desire to stimulate output and to provide monetary financing to governments. As a result of the inability to pre-commit to first-best policies, the central bank produces excess inflation — a tendency partially reduced in a monetary union. The model implies that not only shock asymmetries, but also fiscal asymmetries, are important in the membership calculus of desirable monetary unions. On the basis of this framework, calibrated to euro zone data, the current membership is shown not to be optimal: other members would benefit from the expulsion of several countries, notably Greece, Italy and France. A narrow monetary union centred around Germany is sometimes mooted as a preferable alternative, especially if it could guarantee central bank independence. However, simulation results suggest that such a narrow monetary union would not be in Germany's interest: though better than the euro zone with a dependent central bank, it would not internalize enough trade to make it more attractive than the resumption of monetary autonomy by Germany.
  • Topic: Debt, Economics, Monetary Policy, Governance
  • Political Geography: Europe, Greece, France, Germany, Italy
  • Publication Date: 12-2011
  • Content Type: Working Paper
  • Institution: International Crisis Group
  • Abstract: Women in Sri Lanka's predominantly Tamil-speaking north and east are facing a desperate lack of security in the aftermath of the long civil war. Today many still live in fear of violence from various sources. Those who fall victim to it have little means of redress. Women's economic security is precarious, and their physical mobility is limited. The heavily militarised and centralised control of the north and east – with almost exclusively male, Sinhalese security forces – raises particular problems for women there in terms of their safety, sense of security and ability to access assistance. They have little control over their lives and no reliable institutions to turn to. The government has mostly dismissed women's security issues and exacerbated fears, especially in the north and east. The international community has failed to appreciate and respond effectively to the challenges faced by women and girls in the former war zone. A concerted and immediate effort to empower and protect them is needed.
  • Topic: Security, Economics, Gender Issues
  • Political Geography: South Asia, Sri Lanka
  • Author: Julia Langbein
  • Publication Date: 12-2011
  • Content Type: Working Paper
  • Institution: Kolleg-Forschergruppe "The Transformative Power of Europe"
  • Abstract: Why is regulatory convergence towards EU rules more successful in some policy fields than in others within one EU neighboring country? By comparing Ukraine\'s convergence towards EU rules in the field of shareholders\' rights and technical standards, I challenge prominent explanations for policy change outside the EU that empha¬size misfit and adaptational costs, the institutionalization of EU rules or policy-specific conditionality. In order to deal with the shortcomings of these explanations, it is necessary to disaggregate incentives and capacities of various domestic actors within the particular policy fields. I argue that regulatory convergence in EU neighboring countries is more likely if external actors combine the application of policy-specific conditionality, such as access to the European market, with multiplex capacity-building measures that diversify demand among domestic state regulators and firms and empower them to make their claims.
  • Topic: Economics, International Trade and Finance, Markets, Regional Cooperation
  • Political Geography: Europe, Ukraine
  • Author: Jamee K. Moudud
  • Publication Date: 10-2011
  • Content Type: Working Paper
  • Institution: The New School Graduate Program in International Affairs
  • Abstract: As many authors have argued, the state has played a central role in capitalist development, both in developing and developed countries. The question is why have some states been more successful than others in promoting economic development? In this paper I propose a theoretical agenda to investigate the factors that have made some states more successful than others. I suggest that a complex set of historical, sociological, and political factors shape state formation and a country\'s international competitiveness; further international competitiveness itself shapes the ability to foster economic development. I argue that these factors determine the ways in which states and economies co - evolve. Additionally, since countries are embedded in a global system, an investigation of this co - evolution requires a very different theory of industrial organization and thus of international competition. Thus the state confronts a constrained autonomy in being able to obtain taxation revenue and foreign exchange so as to finance important developmental needs. Finally I conclude that the rationale for “bringing the state back in” has to not only critically examine the notion of “state failure” but also has to reject the notion of “market failure”.
  • Topic: Development, Economics, Markets, Foreign Direct Investment
  • Author: Barry Herman
  • Publication Date: 07-2011
  • Content Type: Working Paper
  • Institution: The New School Graduate Program in International Affairs
  • Abstract: This paper asks how the world of sovereign countries should arrange itself to address global and international economic, financial, social or environmental problems. The current system of institutions and arrangements, informally led by the Group of 20, as convoked by the United States, is hardly ideal. The paper proposes a “pragmatic” alternative with multiple checks and balances, but able to reach timely and effective decisions on the full range of international policy issues. The paper concludes noting that dissatisfaction with current arrangements has reopened intergovernmental debate; it is not the same as undertaking reform, but it is a start.
  • Topic: Economics, Globalization, International Organization, International Trade and Finance
  • Political Geography: United States
  • Author: F. Gregory Gause III
  • Publication Date: 12-2011
  • Content Type: Working Paper
  • Institution: Council on Foreign Relations
  • Abstract: There is arguably no more unlikely U.S. ally than Saudi Arabia: monarchical, deeply conservative socially, promoter of an austere and intolerant version of Islam, birthplace of Osama bin Laden and fifteen of the nineteen 9/11 hijackers. Consequently, there is no U.S. ally less well understood. Many U.S. policymakers assume that the Saudi regime is fragile, despite its remarkable record of domestic stability in the turbulent Middle East. “It is an unstable country in an unstable region,” one congressional staffer said in July 2011. Yet it is the Arab country least affected in its domestic politics by the Arab upheavals of 2011. Many who think it is unstable domestically also paradoxically attribute enormous power to it, to the extent that they depict it as leading a “counterrevolution” against those upheavals throughout the region. 2 One wonders just how “counterrevolutionary” the Saudis are when they have supported the NATO campaign against Muammar al-Qaddafi, successfully negotiated the transfer of power from Ali Abdullah Saleh in Yemen, and condemned the crackdown on protestors by Syrian president Bashar al-Assad, and how powerful they are when they could do little to help their ally Hosni Mubarak in Egypt.
  • Topic: Security, Foreign Policy, Diplomacy, Economics, International Trade and Finance, Islam, Oil, Bilateral Relations
  • Political Geography: United States, Middle East, Arabia, Saudi Arabia
  • Author: J. Jackson Ewing (ed), Alistair D.B. Cook (ed)
  • Publication Date: 12-2011
  • Content Type: Working Paper
  • Institution: Centre for Non-Traditional Security (NTS) Studies
  • Abstract: The year 2011 has seen the further prioritisation of nontraditional security (NTS) issues throughout research and policymaking circles in the Asia-Pacific region. Regional trends and events have highlighted the need for strategies that can help people, communities, states and organisations address multifarious security challenges, thus propelling the NTS platform to a higher stratum of political and institutional discourse.
  • Topic: International Relations, Security, Climate Change, Development, Economics, Health, Poverty, Natural Disasters, Food
  • Political Geography: Asia, Australia/Pacific
  • Author: Steven Leslie
  • Publication Date: 12-2011
  • Content Type: Working Paper
  • Institution: Economist Intelligence Unit
  • Abstract: Business executives are sour about 2012. However, they are much more negative about the prospects for the global economy than for their own industries, and especially for their own companies. These are the headline findings from a global survey of more than 900 corporate decisionmakers about their expectations for 2012.
  • Topic: Economics, Emerging Markets, Industrial Policy, International Trade and Finance, Global Recession, Financial Crisis
  • Political Geography: Europe
  • Author: Lindsay Whitfield
  • Publication Date: 12-2011
  • Content Type: Working Paper
  • Institution: Danish Institute for International Studies
  • Abstract: Ghana has exhibited rather strong economic growth since the 1980s, but little transformation of the productive structure of its economy. The paper argues that ruling elites' policy choices are shaped by their political survival strategies. In turn, these strategies are shaped by (1) the characteristics of the ruling coalitions, which include a high degree of vulnerability in power, strong lower-level factions of the ruling coalition, and a substantial amount of fragmentation among the higher factions of the ruling coalition; (2) the weak capabilities and political influence of the nascent productive capitalists; and (3) easy access to financing for the state and the ruling coalition from foreign aid, mining and cocoa bean exports. As a result, ruling elites' policy actions did not prioritize the development of new productive sectors (or upgrading of old ones), but were geared towards delivering benefits to the higher and lower levels of the ruling coalition, as well as delivering a small amount of visible goods and services to as much of the population as possible in an effort to 'swing' voters their way at election time. Neither of these political survival strategies resulted in significant productive sector investments.
  • Topic: Development, Economics, Politics, Social Stratification, Governance
  • Political Geography: Africa, Ghana
  • Author: Lindsay Whitfield
  • Publication Date: 12-2011
  • Content Type: Working Paper
  • Institution: Danish Institute for International Studies
  • Abstract: Since the Fourth Republic was inaugurated in 1993, politics in Ghana has been increasingly characterized by competitive clientelism. Ruling coalitions are characterized by a high degree of vulnerability in power due to a strong opposition party, by strong lower-level factions within the ruling coalition due to their importance in winning elections, and by a high degree of fragmentation among the ruling elite. These characteristics, combined with a weak domestic capitalist class and high inflows of foreign aid, have led the ruling elites across political parties to pursue and implement policies that have a short time horizon, that do not significantly shift the allocation of resources towards building productive sectors, and which are often plagued by problems of enforcement. The results have led to growth without economic transformation. In particular, the country has witnessed recurrent macroeconomic instability, a haphazard process of privatization of state-owned enterprises, and no serious attempt to build up productive sectors outside of cocoa and gold.
  • Topic: Democratization, Development, Economics, Politics, Social Stratification, Foreign Aid, Governance
  • Political Geography: Africa, Ghana
  • Author: Lindsay Whitfield
  • Publication Date: 12-2011
  • Content Type: Working Paper
  • Institution: Danish Institute for International Studies
  • Abstract: The nascent Ghanaian horticulture export sector, which emerged in the mid-1980s, has been ignored by ruling elites, especially after the return to multiparty democracy in 1993. Ruling elites across the two party governments between 1993 and 2008 did not actively pursue initiatives to support the industry. Without sustained political support, the types of public-private coordination of actions and investments needed to help the sector expand and upgrade were not forthcoming in an effective and timely manner. This private sector-driven non-traditional export sector constitutes a neglected opportunity for export diversification and building a new agro-industry, and also highlights some of the factors explaining why the country's economy was still dependent on the traditional exports of cocoa and gold by the close of the 2000s. The political challenges to changing the productive structure in Ghana can be found in the characteristics of ruling coalitions–vulnerability of the ruling elite in power, the high fragmentation within ruling coalitions, and their existing sources of and strategies for financing the state and the ruling coalition, combined with the country's existing economic structure as well as the size and capabilities of domestic capitalists. The characteristics of ruling coalitions in Ghana shaped the incentives facing ruling elites such that the ruling elites were not sufficiently compelled to support new productive sectors, such as horticulture export, which did not (yet) provide substantial revenues.
  • Topic: Agriculture, Economics, International Trade and Finance, Social Stratification, Governance
  • Political Geography: Africa, Ghana
  • Author: Aristidis P. Bitzenis, Vasileios A. Vlachos
  • Publication Date: 12-2011
  • Content Type: Working Paper
  • Institution: Columbia Center on Sustainable Investment
  • Abstract: With the fall of centrally planned economies in the Balkans, their liberalization and the opening of their borders to free trade and capital movements, Greece became more active in the generation of outward foreign direct investment (OFDI). Greece's OFDI stock increased from US$ 3 billion in 1990 to US$ 6 billion in 2000 and to US$ 38 billion in 2010. The Europeanization process of Turkey and the transition of the economies in the Balkans was accompanied by a gradual rise of FDI from Greece into those economies. More than half of Greece's OFDI stock – over US$ 20 billion in 2009 (67% of total) – is located in South-East Europe: in the Balkans, Cyprus and Turkey. While Greece's early OFDI flows were directed to the secondary sector to reduce costs, the bulk of later flows was directed to the services sector, as new markets were opened. This shift signifies the rise of major corporate players. The Greek Balkan policy, which commenced through the European Union, and the upgrading of the Athens Stock Exchange have positively affected Greece's position as a key regional investor. The expectations for sustaining this leading role, however, have been weakened recently since, due to the Greek sovereign debt crisis, Greek multinational enterprises (MNEs) disinvested US$ 1.6 billion from their FDI abroad in 2010.
  • Topic: Debt, Economics, Foreign Direct Investment, Financial Crisis
  • Political Geography: Europe, Turkey, Greece, Balkans, Cyprus
  • Author: Marco Mutinelli, Lucia Piscitello
  • Publication Date: 12-2011
  • Content Type: Working Paper
  • Institution: Columbia Center on Sustainable Investment
  • Abstract: The attractiveness of the Italian economy for inward foreign direct investment (IFDI) has been traditionally limited, despite the country's locational advantages such as a large domestic market and a skilled labor force. The recent global crisis worsened the country's IFDI position, with flows falling from US$ 40 billion in 2007 to -US$ 11 billion in 2008 before recovering to US$ 20 billion in 2009 but down again to US$ 9 billion in 2010. Although the country's IFDI stock had grown since 2000 at a rate similar to that of the European Union as a whole, in 2010 IFDI stock contracted vis-à-vis 2009, reflecting how Italy, compared to other key European countries and to its own potential, continues to underperform. The main obstacles to exploiting the country's potential for IFDI lie both in the largely insufficient actions undertaken to attract and promote IFDI, and especially in the lack of coordination with other relevant policy measures (e.g. infrastructure development) within a broader framework aimed at regional and national development.
  • Topic: Development, Economics, International Trade and Finance, Foreign Direct Investment
  • Political Geography: Europe, Italy
  • Author: Richard Gowan
  • Publication Date: 12-2011
  • Content Type: Working Paper
  • Institution: United States Institute of Peace
  • Abstract: Multilateral political missions—teams of primarily civilian experts deployed by international and regional organizations with medium- to long-term mandates—play an overlooked role in preventing conflicts in fragile states. Their roles range from addressing long-term tensions to facilitating agreements to quelling escalating violence. More than six thousand personnel are deployed in political missions worldwide. The United Nations and the Organization for Security and Co-operation in Europe oversee the majority of these missions. Although many political missions deal with active conflicts or post conflict situations, some have contributed to conflict prevention in countries ranging from Estonia to Guinea. In the right circumstances, multilateral missions can provide expertise and impartial assistance that national diplomats—whether ambassadors or special envoys—cannot. The activities of political missions include short-term preventive diplomacy, the promotion of the rule of law, and the provision of advice on socioeconomic issues. Some are also involved in monitoring human rights and the implementation of political agreements. Others have regional mandates allowing them to address multiple potential conflicts. A political mission's role differs depending on how far a potential conflict has evolved. In cases where latent tensions threaten long-term stability, a mission can focus on social and legal mechanisms to reduce the risk of escalation. Where a conflict is already escalating, a mission can become directly involved in mediating a peaceful resolution. Even where a conflict tips into full-scale war, a political mission may assist in mitigating violence or keeping political channels open. To strengthen political missions, the United States and its partners should work with the UN Secretariat to revise the rules governing the planning, funding, and start-up processes for political missions and overhaul U.N. personnel rules to make recruiting civilian experts easier. They should also encourage regional organizations to invest more in this type of conflict management tool.
  • Topic: Conflict Resolution, Conflict Prevention, Diplomacy, Economics, International Cooperation, International Law, United Nations
  • Political Geography: United States
  • Author: Arvind Subramanian, Aaditya Mattoo
  • Publication Date: 12-2011
  • Content Type: Working Paper
  • Institution: Peterson Institute for International Economics
  • Abstract: Until recently, the World Trade Organization (WTO) has been an effective framework for cooperation because it has continually adapted to changing economic realities. The current Doha Agenda is an aberration because it does not reflect one of the biggest shifts in the international economic and trading system: the rise of China. Even though China will have a stake in maintaining trade openness, an initiative that builds on but redefines the Doha Agenda would anchor China more fully in the multilateral trading system. Such an initiative would have two pillars. First, a new negotiating agenda that would include the major issues of interest to China and its trading partners, and thus unleash the powerful reciprocal liberalization mechanism that has driven the WTO process to previous successes. Second, new restraints on bilateralism and regionalism that would help preserve incentives for maintaining the current broad non-discriminatory trading order.
  • Topic: Economics, Globalization, International Trade and Finance, Markets
  • Political Geography: China, Israel
  • Author: Edwin M. Truman
  • Publication Date: 12-2011
  • Content Type: Working Paper
  • Institution: Peterson Institute for International Economics
  • Abstract: This paper addresses two central questions for Asia and the world: (1) What is the purpose of Asian regional policy coordination going forward? (2) Will Asian regional policy coordination substitute or complement global policy coordination? The paper examines the potential coverage and content of such policy coordination, what is meant by Asia in this context, and how Asia fits in with global policy coordination processes. Truman addresses three related aspects of Asian regional policy coordination: macroeconomic policies, reserve management, and crisis management. He concludes that while the countries in the Asian region have not completely exploited the scope for regional policy coordination, more ambitious efforts focused on close integration are not likely to bear fruit, in particular, if they are conceived and promoted under the banner of Asian exceptionalism. These conclusions are based on two main considerations: First, Asian economies differ, and will continue to differ, sufficiently in size and stage of development such that it is difficult to conceive of a successful voluntary blending of their interests. Second, the central lesson of the global financial crisis and its current European coda is that global economic and financial integration has advanced sufficiently that countries can run but they cannot hide individually or in sub-global groups of countries.
  • Topic: Economics, International Trade and Finance, Regional Cooperation
  • Political Geography: Europe, Asia
  • Author: Nathan Jensen, Edmund Malesky, Dimitar Gueorguiev
  • Publication Date: 12-2011
  • Content Type: Working Paper
  • Institution: Peterson Institute for International Economics
  • Abstract: We argue that openness to foreign investment can have differential effects on corruption, even within the same country and under the exact same domestic institutions over time. Our theoretical approach departs from standard political economy by attributing corruption motives to firms as well as officials. Rather than interpreting bribes solely as a coercive “tax” imposed on business activities, we allow for the possibility that firms may be complicit in using bribes to enter protected sectors. Thus, we expect variation in bribe propensity across sectors according to expected profitability which we proxy with investment restrictions. Specifically, we argue that foreign investment will not be associated with corruption in sectors with fewer restrictions and more competition, but will increase dramatically as firms seek to enter restricted and uncompetitive sectors that offer higher rents. We test this effect using a list experiment, a technique drawn from applied psychology, embedded in a nationally representative survey of 10,000 foreign and domestic businesses in Vietnam. Our findings show that the impact of domestic reforms and economic openness on corruption is conditional on polices that restrict competition by limiting entry into the sector.
  • Topic: Corruption, Economics, Foreign Direct Investment
  • Author: Trevor Houser, Jason Selfe
  • Publication Date: 11-2011
  • Content Type: Working Paper
  • Institution: Peterson Institute for International Economics
  • Abstract: At the United Nations climate change conference in Copenhagen in 2009 and Cancun in 2010, the United States joined other developed countries in pledging to mobilize $100 billion in public and private sector funding to help developing countries reduce greenhouse gas emissions and adapt to a warmer world. With a challenging US fiscal outlook and the failure of cap-and-trade legislation in the US Congress, America's ability to meet this pledge is increasingly in doubt. This paper identifies, quantifies, and assesses the politics of a range of potential US sources of climate finance. It finds that raising new public funds for climate finance will be extremely challenging in the current fiscal environment and that many of the politically attractive alternatives are not realistically available absent a domestic cap-and-trade program or other regime for pricing carbon. Washington's best hope is to use limited public funds to leverage private sector investment through bilateral credit agencies and multilateral development banks.
  • Topic: Climate Change, Development, Economics, Energy Policy, Politics, Foreign Direct Investment
  • Political Geography: United States, America, Washington, United Nations
  • Author: Cullen S. Hendrix
  • Publication Date: 11-2011
  • Content Type: Working Paper
  • Institution: Peterson Institute for International Economics
  • Abstract: Rock phosphate is a critical, nonrenewable resource for which there is no known substitute in agriculture. Cordell, Drangert, and White (2009) use Hubbert methodology (1956) to estimate the peak—the year after which production will monotonically decline—of world rock phosphate production at 2033–34. This note assesses the applicability of Hubbert's (1949) peak methodology to world rock phosphate production, based on (a) the ability of the model to produce accurate in-sample and out-of-sample forecasts and stable estimates of ultimately recoverable reserves, and (b) the degree to which the rock phosphate market approximates the theoretical conditions underpinning the Hubbert model. In both respects, the application of Hubbert methodology to rock phosphate is found to be problematic.
  • Topic: Agriculture, Economics, International Trade and Finance, Markets, Natural Resources
  • Author: Arvind Subramanian, Utsav Kumar
  • Publication Date: 11-2011
  • Content Type: Working Paper
  • Institution: Peterson Institute for International Economics
  • Abstract: This paper marks the first attempt at examining the growth performance across Indian states for the 2000s, a period also marked by the global financial crisis. Four key findings are reported. First, consistent with the fact that the 2000s was the best ever decade for Indian macroeconomic performance, growth increased across almost all major states in 2001–09 compared to 1993–2001. Second, nevertheless, there is a continued phenomenon of divergence or rising inequality across states: On average the richer states in 2001 grew faster in 2001–09. Third, during the crisis years of 2008 and 2009, states with the highest growth in 2001–07 suffered the largest deceleration. Since states with the highest growth were also the most open, it seems that openness creates dynamism and vulnerability. Finally, although the demographic dividend—a young population boosting economic dynamism—was evident before 2000, there is little evidence that there was any dividend in the 2000s. Demography alone cannot be counted on for future economic growth.
  • Topic: Demographics, Development, Economics, Industrial Policy, International Trade and Finance, Social Stratification
  • Political Geography: South Asia, India
  • Author: C. Randall Henning, Mohsin S. Khan
  • Publication Date: 10-2011
  • Content Type: Working Paper
  • Institution: Peterson Institute for International Economics
  • Abstract: Currently, Asia's influence in global financial governance is not consistent with its weight in the world economy. This paper examines the role of Asia in the International Monetary Fund (IMF) and the Group of Twenty (G-20). It looks in particular at how the relationship between East Asian countries and the IMF has evolved since the Asian financial crisis of 1997–98 and outlines how Asian regional arrangements for crisis financing and economic surveillance could constructively interact with the IMF in the future. It also considers ways to enhance the effectiveness of Asian countries in the G-20 process.
  • Topic: Development, Economics, Emerging Markets, Globalization, International Trade and Finance, Monetary Policy
  • Political Geography: Israel, Asia
  • Author: Qiong Zhang, Chong-En Bai
  • Publication Date: 12-2011
  • Content Type: Working Paper
  • Institution: Asia-Pacific Research Center
  • Abstract: China's economic growth over the past three decades is unprecedented. Although this growth is commonly attributed to a high domestic savings rate among “thrifty” Chinese, savings alone cannot promote economic growth unless productivity has continuously grown for such a long period. This article uses a one-sector, neoclassical growth model to calibrate the economy to Chinese data since 1952 and finds that measuring changes in total factor productivity between 1952 and 2005 can well capture the secular movements in the Chinese savings rate. Far from supporting the widespread belief that China's savings rate is too high, this article argues that even thrifty Chinese “under-saved” for most of the years during this period; furthermore, the fiscal reforms of 1983 and 1985 further suppressed saving behavior, especially China's economic growth over the past three decades is unprecedented. Although this growth is commonly attributed to a high domestic savings rate among “thrifty” Chinese, savings alone cannot promote economic growth unless productivity has continuously grown for such a long period. This article uses a one-sector, neoclassical growth model to calibrate the economy to Chinese data since 1952 and finds that measuring changes in total factor productivity between 1952 and 2005 can well capture the secular movements in the Chinese savings rate. Far from supporting the widespread belief that China's savings rate is too high, this article argues that even thrifty Chinese “under-saved” for most of the years during this period; furthermore, the fiscal reforms of 1983 and 1985 further suppressed saving behavior, especially when initially implemented. In presenting such findings, this article at least partly solves the so-called “Chinese savings puzzle.”
  • Topic: Development, Economics, International Trade and Finance, Monetary Policy
  • Political Geography: China
  • Author: Jennifer S. Rosenberg
  • Publication Date: 12-2011
  • Content Type: Working Paper
  • Institution: Human Rights Human Welfare (University of Denver)
  • Abstract: On January 12, 2010, an earthquake of devastating magnitude shook Haiti, killing over 250,000, reducing much of the country's infrastructure to rubble—including its government—and leaving millions of people without homes and livelihoods. As Haiti lurches toward an era of rebuilding and renewal, the ways in which priorities are set and resources spent can either accelerate the rate at which Haitians are able to emerge from poverty and achieve economic development—or they can substantially inhibit the country's path toward recovery. One of the most critical factors that will determine which path Haiti takes is the extent to which gender concerns are brought to the fore in the reconstruction process. Gender mainstreaming, as a technical term in the development field, involves ensuring that gender perspectives and attention to the goal of gender equality are central to all activities, from policy development to legislative drafting. Such a women-focused approach is not only imperative from a moral justice and human rights perspective, but also a vital component of a successful economic development strategy.
  • Topic: Development, Economics, Gender Issues, Health, Human Rights, Human Welfare, Natural Disasters
  • Author: Karam Dana
  • Publication Date: 12-2011
  • Content Type: Working Paper
  • Institution: Belfer Center for Science and International Affairs, Harvard University
  • Abstract: Since the Six-Day War and Occupation of 1967, economics, an area of study that affects social and political formulations and transformations, has entered the study of the Palestinian-Israeli conflict to a much larger extent: Palestinian workers in Israel, to an underdeveloped infrastructure in the Palestinian territories. More than four decades later, economic challenges continue to play a role in the affairs of the Palestinians: from affecting people's lives and their leadership on the one hand, and the relationship between the Palestinian and Israel on the other. Within Palestinian society itself, the dynamics of state-society relations have demonstrably been affected by economic transformations, but have yet to be fully studied in places of continuous occupation and conflict like the West bank and the Gaza Strip. This paper explores the challenges that have faced developmental attempts in Palestine since the occupation of 1967.
  • Topic: Development, Economics, Infrastructure
  • Political Geography: Middle East, Arabia
  • Author: Julie A. Nelson
  • Publication Date: 10-2011
  • Content Type: Working Paper
  • Institution: Global Development and Environment Institute at Tufts University
  • Abstract: Would having more women in leadership have prevented the financial crisis? This question challenges feminist economists to once again address questions of "difference" versus "sameness" that have engaged—and often divided—academic feminists for decades. The first part of this essay argues that while some behavioral research seems to support an exaggerated "difference" view, non-simplistic behavioral research can serve feminist libratory purposes by debunking this view and revealing the immense unconscious power of stereotyping, as well as the possibility of non-dualist understandings of gender. The second part of this essay argues that the more urgently needed gender analysis of the financial industry is not concerned with (presumed) "differences" by sex, but rather with the role of gender biases in the social construction of markets. An Appendix discusses specific examples and tools that can be used when teaching about difference and similarity.
  • Topic: Economics, Gender Issues, Politics, Political Theory, Financial Crisis, Governance
  • Author: Anthony Olcott
  • Publication Date: 01-2011
  • Content Type: Working Paper
  • Institution: Institute for the Study of Diplomacy, Edmund A. Walsh School of Foreign Service, Georgetown University
  • Abstract: For this paper, I have decided to step through the proscenium and appeal directly across the “fourth wall” to whatever readers this piece may attract, in the hopes that someone among you will be able to help me figure out the answers to a set of questions with which I have been wrestling for several years. For fun, let's call this paper an exercise in crowd-sourcing.
  • Topic: Foreign Policy, Diplomacy, Economics, International Trade and Finance, Markets
  • Political Geography: United States
  • Author: Jake Sherman, Megan M. Gleason (ed), W.P.S. Sidhu (ed), Bruce Jones (ed)
  • Publication Date: 09-2011
  • Content Type: Working Paper
  • Institution: Center on International Cooperation
  • Abstract: In the past several years, key governments and multilateral institutions have devoted considerable effort to the task of more effectively integrating development and security policy responses to the related challenges of countries affected by conflict, post-conflict peacebuilding, and conflict prevention. The looming deadline of the Millennium Development Goals, has focused attention on this important nexus and the near impossibility of crisis-and conflict-affected states achieving these goals unless development and security is more effectively integrated. Despite progress on several fronts, including at the United Nations and at the international financial institutions, developing policy for effective development and security engagement remains a challenge in both conceptual and operational terms – not least because discussion of political, security, economic, and humanitarian issues traditionally has occurred in different multilateral fora, among different sets of stakeholders.
  • Topic: Security, Development, Economics, Humanitarian Aid, International Trade and Finance, United Nations
  • Author: Alex Evans, David Steven
  • Publication Date: 06-2011
  • Content Type: Working Paper
  • Institution: Center on International Cooperation
  • Abstract: The Rio 2012 summit on sustainable development is now one year away. Over two decades since the 1992 'Earth Summit', sustainable development has not materialized: as global GDP has risen, so have greenhouse gas emissions, species loss and environmental degradation.
  • Topic: Climate Change, Development, Economics, Environment, Foreign Aid, Foreign Direct Investment
  • Political Geography: Latin America
  • Author: William Zartman, Laleh Khalili, Jillian Schwedler, Gamal Eid
  • Publication Date: 10-2011
  • Content Type: Working Paper
  • Institution: Center for Contemporary Arab Studies
  • Abstract: In January and February 2011, populist uprisings toppled the authoritarian governments of Tunisia and Egypt, and similar revolts began to emerge in other Arab states, including Bahrain, Libya, Morocco, Syria, and Yemen. An article in the 18 March 2011 issue of the Chronicle Review by Ursula Lindsey, "The Suddenly New Study of Egypt," addressed how these events had turned the study of persistent authoritarianism in the Arab world on its head. No longer, for example, could scholars point to how Egyptians and other Arabs tend to engage in one of two extremes: political apathy or political violence. Lindsey also suggested that scholars shift their focus away from the power of elites to the strength of ordinary people and grass-roots movements, or retool their scholarship to allow for, in the case of Egypt, more emphasis on groups other than the Muslim Brotherhood as significant sources of opposition.
  • Topic: Democratization, Economics, Regime Change, Insurgency
  • Political Geography: Middle East, Libya, Yemen, Arabia, North Africa, Syria, Egypt, Bahrain, Tunisia
  • Author: Hassan Eini-Zinab
  • Publication Date: 02-2011
  • Content Type: Working Paper
  • Institution: East-West Center
  • Abstract: This paper develops, validates, and applies new multivariate methodology to assess the effect of child mortality on both period and cohort measures of fertility. The methodology, which can be applied to period data as well as cohort data, is based on discrete-time survival models of parity progression that enable construction of a multivariate life table of fertility covering all parity transitions. The five dimensions of this life table are woman's age, parity, duration in parity, and two dimensions representing lagged child mortality (number of dead children at the beginning and end of the previous year when the woman was one year younger). Additional socioeconomic predictor variables are also included in the underlying survival models. The life table is multivariate in the sense that it can be specified for values or categories of one socioeconomic predictor variable while holding other socioeconomic predictors constant. The life table yields a number of measures of both the quantum and the tempo of fertility and child mortality. It also yields a replacement rate, which measures the extent to which child deaths are replaced by additional births. Because the life table is multivariate, all measures calculated from it are also multivariate. By way of illustration, the methodology is applied to three Indian National Family Health Surveys conducted in 1992–93 (NFHS -1 ), 1998–99 (NFHS -2 ), and 2005–06 (NFHS -3 ). Major findings are that dead children are incompletely replaced, and that the replacement rate rises as the total fertility rate falls over the three surveys, reflecting women's increasing ability to achieve their wanted number of surviving children.
  • Topic: Economics, Gender Issues, Health, Social Stratification
  • Publication Date: 12-2011
  • Content Type: Working Paper
  • Institution: Aspen Institute
  • Abstract: Today America finds a new market force emerging: companies that achieve an intimate connection between profit and purpose. And these businesses are supported by a developing system of investors and other financial actors that seek to place capital in firms that are achieving social impact. A new trail is being blazed for our country – open, far-reaching, transformative, offering an opportunity for renewal and growth. This is the Impact Economy.
  • Topic: Economics, Industrial Policy, International Trade and Finance, Markets, Monetary Policy
  • Political Geography: United States, America
  • Author: Phil Sharp
  • Publication Date: 10-2011
  • Content Type: Working Paper
  • Institution: Aspen Institute
  • Abstract: The question is never whether the United States has an energy policy. It has dozens. They come with various decision-makers at overlapping levels of authority, ample numbers of stakeholders, and generally lots of confusing and often contradictory signals.
  • Topic: Climate Change, Economics, Energy Policy, Environment
  • Political Geography: United States
  • Author: David Bollier
  • Publication Date: 03-2011
  • Content Type: Working Paper
  • Institution: Aspen Institute
  • Abstract: Over the course of the past generation, but especially since the World Wide Web emerged in 1994, digital technologies have been transforming the nature of work, the architectures of markets and the inner dynamics of organizations. They have also been altering the global economy and national cultures, which in turn is forcing governments to change how they build infrastructure, meet social needs and provide services.
  • Topic: Economics, Education, Globalization, Government, International Trade and Finance, Science and Technology
  • Author: Hassan Abbas
  • Publication Date: 05-2011
  • Content Type: Working Paper
  • Institution: Asia Society
  • Abstract: In recent years, Pakistan has stumbled from one crisis to another. A number of political and socioeconomic challenges threaten to further destabilize a country that already is reeling from insurgencies along its northwestern border. Pakistan's newest democratic government is struggling to maintain control over parts of its territory where militant religious groups are intent on challenging its authority and legitimacy. The country's conflict with India over Kashmir, now in its seventh decade, appears as intractable as ever, and the war in neighboring Afghanistan has deepened instability throughout Pakistan. The transition from a near-decade-long rule under a military dictatorship is slow and complicated, as rampant corruption and politicization of the bureaucracy present huge obstacles to the state-building process.
  • Topic: Conflict Resolution, Foreign Policy, Democratization, Development, Economics, Education, Health Care Policy
  • Political Geography: Pakistan, Afghanistan, South Asia
  • Author: Jochen Hippler
  • Publication Date: 06-2011
  • Content Type: Working Paper
  • Institution: Institute for Development and Peace
  • Abstract: Western foreign policy is increasingly attempting to influence and reform the internal political situation and societies in target countries (for example to achieve democratization or economic reform), instead of restricting itself to inter-governmental exchange. The record of success in this regard is hardly encouraging. Does Western foreign policy have the necessary strategies and instruments to achieve these goals? This paper will analyze the mix of foreign policy interests involved, the development of strategy, and its instruments. It then focuses on the necessary preconditions for success in the target countries, both in society and the political system. In a next step the paper analyses the problems and limits of a policy of external reform by Western governments. Finally it offers a series of short policy recommendations.
  • Topic: International Relations, Foreign Policy, Democratization, Development, Economics, Humanitarian Aid, International Security, Foreign Aid
  • Author: Clémentine d'Oultremont
  • Publication Date: 10-2011
  • Content Type: Working Paper
  • Institution: EGMONT - The Royal Institute for International Relations
  • Abstract: An agreement on climate finance is crucial to ensure an equitable approach between developed and developing countries in the fight against climate change. Given their economic capabilities and their historical responsibility for global warming, developed countries are expected to bear the majority of the costs associated with global climate action. The Cancun Agreements formalise a commitment by developed countries to jointly provide USD 30 billion for the period between 2010 and 2012 and USD 100 billion annually by 2020 for developing countries. This funding will be balanced between adaptation and mitigation and is destined primarily for the most vulnerable developing countries. The objective is to help developing countries adapt to the adverse impacts of climate change and to undertake mitigation actions so as to bring them towards a low-carbon economy.
  • Topic: Climate Change, Development, Economics, Emerging Markets, Industrial Policy, Treaties and Agreements
  • Author: Stijn Verhelst
  • Publication Date: 06-2011
  • Content Type: Working Paper
  • Institution: EGMONT - The Royal Institute for International Relations
  • Abstract: The euro is a rather unusual currency as it is shared by a union of largely independent states. This results in a single supranational monetary union, while most 'economic' matters are decided on a national level. A key challenge in such a system is to ensure that the different levels of decision-making do not undermine the advantages of the common currency. For this reason, the European monetary union has been buttressed by economic integration, resulting in the Economic and Monetary Union (EMU).
  • Topic: Debt, Economics, Monetary Policy, Financial Crisis, Governance
  • Political Geography: Europe
  • Author: Tinne Heremans
  • Publication Date: 01-2011
  • Content Type: Working Paper
  • Institution: EGMONT - The Royal Institute for International Relations
  • Abstract: On the 27th of October 2010 the Commission finally published its long-awaited Communication “Towards a Single Market Act” with the ambitious objective of relaunching the Single Market. It is beyond doubt that the market integration project is indeed in need of a serious boost. On the one hand, the “acquis” should be buttressed more firmly against protectionist reactions, citizen distrust and integration lethargy more generally. On the other hand, the untapped growth potential – in domains suffering from persistent bottlenecks as well as in new sectors – needs to be better exploited. It will however be argued in this contribution that, in its present form, the Commission's “Draft Single Market Act” (Draft SMA) does not contain all the strategic building blocks needed to address the key challenge of reengaging the different actors in the market integration project and genuinely revamp the Single Market. Therefore, on the basis of an examination of the gaps and defaults in the Draft SMA's approach, and against the background of the preparatory documents presented by Mario Monti and the European Parliament, some suggestions for possible strategic improvements to be included in the final SMA will be made.
  • Topic: Economics, Markets, Regional Cooperation, Monetary Policy
  • Political Geography: Europe
  • Author: Stijn Verhelst
  • Publication Date: 03-2011
  • Content Type: Working Paper
  • Institution: EGMONT - The Royal Institute for International Relations
  • Abstract: In order to obtain financial sector stability, adequate financial regulation and supervision are paramount. Despite their crucial role, both failed to prevent or at least mitigate the financial crisis. While financial regulation strives to impose a set of rules that ensure a safe and resilient financial sector, it has proven to contain too many gaps and loopholes.
  • Topic: Debt, Economics, Markets, Monetary Policy, Financial Crisis, Governance
  • Political Geography: Europe
  • Publication Date: 10-2011
  • Content Type: Working Paper
  • Institution: Liechtenstein Institute on Self-Determination
  • Abstract: The Liechtenstein Institute on Self-Determination at Princeton University (LISD) convened the conference, “Toward a Sovereign Afghanistan,” October 20-22, 2011, in the Cecilienhof Castle of Potsdam near Berlin, Germany. More than 40 leading experts from Afghanistan and 14 other states participated in the private, off-the-record conference. The colloquium was opened by Ambassador Staffan de Mistura, Special Envoy for Afghanistan of the UN Secretary-General; Dr. Rangin Spanta, Afghanistan National Security Advisor; Ambassador Michael Steiner, Special Representative of the Germany for Afghanistan and Pakistan; and Ambassador Vygaudas Ušackas, Special Representative and Head of Mission of the EU's Mission for Afghanistan. Wolfgang Danspeckgruber, LISD Director, chaired the colloquium.
  • Topic: Conflict Resolution, Security, Civil Society, Economics, Islam, Peace Studies, Self Determination
  • Political Geography: Pakistan, Afghanistan, Germany
  • Author: T. N. Ninan
  • Publication Date: 12-2011
  • Content Type: Working Paper
  • Institution: Center for the Advanced Study of India
  • Abstract: Distinguished ladies and gentlemen, I must confess that the title for this lecture was thought up on the spur of the moment. Still, you might wonder which characters in Dickens' novels we can see in the Indian media. I can readily say that many journalists see latter-day versions of Uncle Scrooge; publishers who want to run their empires on shoestring budgets. Publishers, in turn, will say we have our Oliver Twist journalists, who keep asking their employers for more-even when salaries are doubling every four or five years. We have reporters who are Artful Dodgers, especially when it comes to deadlines. We have bankrupt TV moguls who, like Micawber, are forever hoping that something will turn up. And of course, many readers are like Pip, they had great expectations about the media but feel robbed and are disappointed. But when I fixed on the title, of a Dickensian Age for the Indian media, I had none of this in mind. My thought was the more predictable one, that this is a tale not of two cities but two narratives, competing narratives.
  • Topic: Economics, Communications, Mass Media
  • Political Geography: South Asia
  • Publication Date: 04-2011
  • Content Type: Working Paper
  • Institution: American Assembly at Columbia University
  • Abstract: The global knowledge economy favors cities because their density and infrastructure support the knowledge spillovers and innovation that flow from concentrated economic activity. Increasing demand for energy efficiency, too, favors the proximity and walkability found in cities' dense urban development patterns. Perhaps most importantly, cities continue to offer a unique opportunity for living well together in dense, dynamic communities where diversity and democracy flourish. In the United States people continue to move to metropolitan areas and before the Great Recession were increasingly returning to central cities, a trend expected to continue as the economy rebounds.
  • Topic: Development, Economics, Markets, Governance, Urbanization
  • Political Geography: United States
  • Author: Alexandros Petersen, Katinka Barysch
  • Publication Date: 11-2011
  • Content Type: Working Paper
  • Institution: Carnegie Endowment for International Peace
  • Abstract: Energy has come to symbolise the geopolitics of the 21st century, reflecting countries' diminishing reliance on military and political power. Today, energy is an instrument of geopolitical competition, like nuclear weapons or large armies were during the Cold War. The means of international influence have become more diverse and sophisticated, but the goals remain much the same: national security, power projection, and control over resources and territory.
  • Topic: Economics, Energy Policy, International Trade and Finance, Bilateral Relations, Natural Resources
  • Political Geography: Russia, China, Central Asia
  • Publication Date: 07-2011
  • Content Type: Working Paper
  • Institution: Atlantic Council
  • Abstract: In 2008 and 2009 political and business leaders scrambled to stabilize the financial system and avert a slide into world-wide depression as a financial crisis of historic proportions spread across the globe. A series of bold emergency measures succeeded in defusing the crisis, and these same leaders began searching for ways to avoid a similar breakdown in the future. At the same time, the effort to restart economic growth and job creation began in earnest.
  • Topic: Economics, International Cooperation, International Trade and Finance, Financial Crisis
  • Political Geography: United States, Europe
  • Publication Date: 07-2011
  • Content Type: Working Paper
  • Institution: Atlantic Council
  • Abstract: If the democratic transition in Egypt fails and the country adopts a repressive, authoritarian, or theocratic form of government, the consequences could be profound. Failure in Egypt could lead other countries in the region to turn away from the very idea of democratic reform. Of course, democracy in other countries will rise and fall due to local conditions. Nevertheless, if the transition in Egypt succeeds, and the country acquires a democratic, accountable, and efficient form of government, it is likely to become a powerful example and, ultimately, a stabilizing force in a turbulent region.
  • Topic: Foreign Policy, Development, Economics, Humanitarian Aid
  • Political Geography: Middle East, Egypt
  • Author: John Whalley, Chunding Li, Jing Wang
  • Publication Date: 07-2011
  • Content Type: Working Paper
  • Institution: Centre for International Governance Innovation
  • Abstract: The term "mega deal" has been widely used in relation to two large prospective trade deals between the United States and Europe – the Transatlantic Trade and Investment Partnership (TTIP) — and in Asia and the Pacific — the Trans-Pacific Partnership (TPP). This paper starts by exploring a possible description of trade mega deals by making an inventory of mega deals in place, under discussion or negotiation, and deals yet to be considered under different criteria. This paper also calculates the trade volume coverage and trade barrier coverage for potential mega deals, and the results show the potential impact of mega deals on trade and growth performance is large.
  • Topic: Development, Economics, International Trade and Finance
  • Political Geography: United States, Europe, Asia
  • Author: Hüseyin Selçuk Dönmez
  • Publication Date: 05-2011
  • Content Type: Working Paper
  • Institution: Centre for Strategic Research and Analysis
  • Abstract: Turkey's accession process to the European Union (EU) has been a rather challenging issue for more than two decades now. Turkey applied for membership in 1987, "that is, three years before Cyprus and Malta and between seven and nine years before applications were lodged by ten Central and Eastern European countries (CEECs)." By the year 2011, Turkey has been waiting for 24 years to become a member of the EU. No other country in history of the EU enlargement has waited this long to become a member and not managed to become one after a quarter of a century. It would not be wrong to consider Turkey's bid to join the EU as a unique case in comparison to the former applicant countries, especially CEECs. As a result of this, there has been a continuous debate about Turkey's application and whether it has been treated differently or not. The aim of this paper is to shed a brighter light on this debate by presenting examples of different treatment towards the Turkish application. Before exploring the reasons of why and how Turkey has been treated differently, there are some key facts worth mentioning while defining Turkey's difference from other applicant countries. What makes these facts important is that they have formed the foundations of hurdles and their justifications for Turkey's possible membership in the EU. These facts will be touched upon prior to a deeper analysis.
  • Topic: Economics, Sociology, Culture
  • Political Geography: Europe, Turkey
  • Author: Jewellord (Jojo) Nem Singh
  • Publication Date: 04-2011
  • Content Type: Working Paper
  • Institution: Centre for Strategic Research and Analysis
  • Abstract: In the most recent attempt of Latin America's primary intellectual hub to res-pond to the world-wide financial crisis, the Economic Commission for Latin America and the Caribbean (CEPAL) argued for the need to tackle 'growth with equity' as an organising principle of development strategies in the Americas. Crucially, this opens up two main discussions. Firstly, neoliberal economics, though a complex political project aimed at controlling inflation, curbing state inefficiency and addressing debt management via fiscal discipline, has failed to deliver its promise of economic development through unfettered market opening. After twenty years of reforms, uneven patterns of economic growth, sustained inequality, and environmental exploitation have been its key consequences for Latin American countries (CEPAL 2010: 17, 20, 53). Having said this, macroeconomic stabilisation policy has been widely adopted since the debt crisis, which successfully addressed fiscal disequilibria and is now considered a pillar of sound policymaking in the region and elsewhere. But as neoliberal reforms induced the eclipse of state activism, social inequality remains unaddressed, even in cases where sustained economic growth was occurring, specifically Chile whose growth hardly came together with social equality despite the rhetoric of its left-centre La Concertación governments. Equality, whether in terms of access to the market or to decision-making, does not come naturally with economic growth.
  • Topic: Economics, Politics
  • Political Geography: Latin America, Caribbean
  • Publication Date: 01-2010
  • Content Type: Working Paper
  • Institution: International Crisis Group
  • Abstract: The economic crisis has caused millions of migrant labourers from Tajikistan, Kyrgyzstan and Uzbekistan to lose their jobs in the boom economies of Russia and Kazakhstan. Remittances that kept their relatives afloat have plummeted and many migrants have returned home to certain destitution, putting weak Central Asian governments under severe strain. In Tajikistan half the labour force is without work, while Kyrgyzstan suffers from massive rural unemployment. Before the crisis hit, up to five million people from these countries left home for Russia and Kazakhstan to take on poorly paid and unskilled jobs, often the unpleasant tasks that local people no longer wished to do. Yet at home they were viewed with respect: the most daring members of their society, who were willing to take a jump into the unknown to pull themselves and their families out of poverty. Remittances also boosted their home countries' economic data, allowing governments with little ability or interest in creating jobs to claim a modest degree of success. By 2008 remittances were providing the equivalent of half Tajikistan's gross domestic product (GDP), a quarter of Kyrgyzstan's GDP, and an eighth of Uzbekistan's.
  • Topic: Economics, Migration, Labor Issues, Financial Crisis
  • Political Geography: Russia, Central Asia, Kazakhstan, Kyrgyzstan, Tajikistan, Uzbekistan
  • Author: Nicole Hirt
  • Publication Date: 01-2010
  • Content Type: Working Paper
  • Institution: German Institute of Global and Area Studies
  • Abstract: This article analyzes contemporary Eritrea's acute crisis within the framework of the theory of anomie. It is based on the hypothesis that militarization, forced labor, mass exodus, and family disintegration can be interpreted as the consequences of two incompatible norm and value systems: the collectivist, nationalistic, and militaristic worldview of the former liberation front and ruling party People's Front for Democracy and Justice (PFDJ), and the traditional cultural system of Eritrea's society. In 2002 the regime introduced an unlimited "development campaign," thereby forcing large parts of the society to live as conscripts and perform unpaid labor. This has caused a mass exodus of young people and a rapid process of family disintegration. The article is based on empirical fieldwork and evaluates the ongoing developments, which have led to rapid economic decline and the destabilization of the entire fabric of society.
  • Topic: Development, Economics, Migration, Fragile/Failed State, Governance
  • Political Geography: Africa, Eritrea
  • Author: Annegret Mähler
  • Publication Date: 01-2010
  • Content Type: Working Paper
  • Institution: German Institute of Global and Area Studies
  • Abstract: This paper studies the oil-violence link in the Niger Delta, systematically taking into consideration domestic and international contextual factors. The case study, which focuses on explaining the increase in violence since the second half of the 1990s, confirms the differentiated interplay of resource-specific and non-resource-specific causal factors. With regard to the key contextual conditions responsible for violence, the results underline the basic relevance of cultural cleavages and political-institutional and socioeconomic weakness that existed even before the beginning of the “oil era.” Oil has indirectly boosted the risk of violent conflicts through a further distortion of the national economy. Moreover, the transition to democratic rule in 1999 decisively increased the opportunities for violent struggle, in a twofold manner: firstly, through the easing of political repression and, secondly, through the spread of armed youth groups, which have been fostered by corrupt politicians. These incidents imply that violence in the Niger Delta is increasingly driven by the autonomous dynamics of an economy of violence: the involvement of security forces, politicians and (international) businessmen in illegal oil theft helps to explain the perpetuation of the violent conflicts at a low level of intensity.
  • Topic: Political Violence, Crime, Economics, Oil
  • Political Geography: Africa
  • Author: Jeffrey A. Frankel, Daniel Xie
  • Publication Date: 01-2010
  • Content Type: Working Paper
  • Institution: Peterson Institute for International Economics
  • Abstract: A new technique for estimating countries' de facto exchange rate regimes synthesizes two approaches. One approach estimates the implicit de facto basket weights in an ordinary least squares (OLS) regression of the local currency value rate against major currency values. Here the hypothesis is a basket peg with little flexibility. The second estimates the de facto degree of exchange rate flexibility by observing how exchange market pressure is allowed to show up. Here the hypothesis is an anchor to the dollar or some other single major currency, but with a possibly substantial degree of exchange rate flexibility around that anchor. It is important to have available a technique that can cover both dimensions: inferring anchor weights and the flexibility parameter. We test the synthesis technique on a variety of fixers, floaters, and basket peggers. We find that real world data demand a statistical technique that allows parameters and regimes to shift frequently. Accordingly we estimate de facto exchange rate regimes: endogenous estimation of parameter breakpoints, following Bai and Perron (1998).
  • Topic: Economics, International Trade and Finance, Markets
  • Publication Date: 02-2010
  • Content Type: Working Paper
  • Institution: International Crisis Group
  • Abstract: The historically coveted region of Abkhazia has become even more dependent on Moscow since Russia's controversial recognition a year and a half ago. Russia is financing half the region's budget, and against vigorous Georgian protests, it is spending $465 million to refurbish existing and build new military installations in the picturesque Black Sea coastal area. Virtually the entire population holds Russian citizenship, and almost all trade is with the northern neighbour. It will take constructive, creative thinking on the part of Georgian, Russian, Abkhazian and international actors alike to restore even a modicum of confidence between the parties to the conflict. Given Abkhazia's unrealistic insistence that Georgia recognise it as independent and the equally unrealistic prospect that Sukhumi will acknowledge Georgia's sovereignty, the two parties should focus on creating economic and humanitarian links without status preconditions in order to benefit both, build stability and give momentum to a long reconciliation process.
  • Topic: Economics, Bilateral Relations
  • Political Geography: Russia, Asia
  • Author: Yada Praparpun
  • Publication Date: 02-2010
  • Content Type: Working Paper
  • Institution: Oxfam Publishing
  • Abstract: This report analyses the impact of the current global economic crisis on women in five Southeast Asian countries: Cambodia, Indonesia, the Philippines, Thailand and Vietnam. This research aims to provide up-to-date information and recommendations to policy makers in both the public and private sectors on how the economic crisis is affecting women workers in the aforementioned countries. The results of the research will be shared with civil society organizations, government agencies, regional and global institutions, academic institutions, trade unions, donor agencies, NGOs, and the media.
  • Topic: Economics, Gender Issues, Financial Crisis
  • Political Geography: Southeast Asia
  • Author: Simon Feeny
  • Publication Date: 02-2010
  • Content Type: Working Paper
  • Institution: Oxfam Publishing
  • Abstract: At a macroeconomic level, the Global Economic Crisis (GEC) has had less impact on many Pacific countries than on most other developing countries across the world. However, this does not imply that Pacific country economies are performing well. Economic growth rates for most countries in the Pacific region are expected to be low for 2009 and 2010 and the majority of economies are likely to contract on a per capita basis in these years.
  • Topic: Climate Change, Economics, Poverty, Financial Crisis
  • Political Geography: Australia/Pacific
  • Author: Per Botolf Maurseth
  • Publication Date: 02-2010
  • Content Type: Working Paper
  • Institution: Norwegian Institute of International Affairs
  • Abstract: A stylised fact from the large and growing literature on relationships between trade and growth is that liberal trade policies may stimulate growth. However, there is no academic consensus that liberal trade policies are either necessary or sufficient ingredients in growth promoting policies. In this paper, the relationships between trade policy and growth are investigated. The paper adds some new findings. My measure of trade policy is not only applied average tariff rates which have been used by others, but such tariff rates for agriculture and manufacturing separately. The results indicate opposite results of the two: Protection of manufacturing correlates negatively with growth, while tariffs on agriculture imports seem to have a weaker though positive correlation. These results are robust in the sense that they remain significant with the same sign independently of different specifications and inclusions of various control variables.
  • Topic: Agriculture, Economics, Industrial Policy, International Trade and Finance
  • Author: John Samples
  • Publication Date: 02-2010
  • Content Type: Working Paper
  • Institution: The Cato Institute
  • Abstract: The U.S. Constitution vests all the “legislative powers” it grants in Congress. The Supreme Court allows Congress to delegate some authority to executive officials provided an “intelligible principle” guides such transfers. Congress quickly wrote and enacted the Emergency Economic Stabilization Act of 2008 in response to a financial crisis. The law authorized the secretary of the Treasury to spend up to $700 billion purchasing troubled mortgage assets or any financial instrument in order to attain 13 different goals. Most of these goals lacked any concrete meaning, and Congress did not establish any priorities among them. As a result, Congress lost control of the implementation of the law and unconstitutionally delegated its powers to the Treasury secretary. Congress also failed in the case of EESA to meet its constitutional obligations to deliberate, to check the other branches of government, or to be accountable to the American people. The implementation of EESA showed Congress to be largely irrelevant to policymaking by the Treasury secretary. These failures of Congress indicate that the current Supreme Court doctrine validating delegation of legislative powers should be revised to protect the rule of law and separation of powers.
  • Topic: Economics, Monetary Policy, Financial Crisis
  • Political Geography: United States, America
  • Author: Jagadeesh Gokhale
  • Publication Date: 02-2010
  • Content Type: Working Paper
  • Institution: The Cato Institute
  • Abstract: Globalization holds tremendous promise to improve human welfare but can also cause conflicts and crises as witnessed during 2007–09. How will competition for resources, employment, and growth shape economic policies among developed nations as they attempt to maintain productivity growth, social protections, and extensive political and cultural freedoms?
  • Topic: Development, Economics, Globalization, International Trade and Finance
  • Political Geography: Global Focus
  • Author: Liliana Rojas-Suarez, Arturo J. Galindo, Alejandro Izquierdo
  • Publication Date: 02-2010
  • Content Type: Working Paper
  • Institution: Center for Global Development
  • Abstract: This paper explores the impact of international financial integration on credit markets in Latin America. Using a cross-country dataset covering 17 Latin American countries between 1996 and 2008, the authors find that financial integration amplifies the impact of international financial shocks on aggregate credit and interestrate fluctuations. Despite this pernicious effect, the net impact of integration on deepening credit markets is positive and dominates for the large majority of states of nature. The paper also uses a detailed bank-level dataset covering more than 500 banks in Latin America for a similar time period to explore the role of financial integration—captured through the participation of foreign banks—in propagating external shocks. The authors find that interest rates charged and loans supplied by foreign-owned banks respond more to external financial shocks than those supplied by domestically owned banks. However, this result does not hold for all foreign banks: Spanish banks in the sample behave more like domestic banks and do not amplify the impact of foreign shocks on credit and interest rates. Important policy recommendations to avoid foreign banks' amplification of external financial shocks include the establishment of ring-fencing mechanisms, the development of early-warning systems, and the incorporation for agreements between domestic and foreign supervisors.
  • Topic: Economics, Markets
  • Political Geography: Latin America, Spain
  • Author: Liliana Rojas-Suarez
  • Publication Date: 01-2010
  • Content Type: Working Paper
  • Institution: Center for Global Development
  • Abstract: The international financial crisis of 2008–09 exposed the strengths and weaknesses of the current paradigm of development in Latin America, a paradigm based on liberalized capital accounts and significantly improved macroeconomic conditions. This paper presents lessons derived from the crisis, not only for the region itself, but also for other developing countries that might seek economic growth in the context of greater integration to the international capital markets. Some of the lessons are not new but have been reinforced by the crisis, such as Latin America's imperative need for export diversification (not only in products but in partners). Other lessons break with longstanding myths about the region, such as its inability to undertake counter-cyclical policies—at least on the monetary side. Yet other lessons reflect new developments in the current growth paradigm, such as a renewed assessment of (1) the relative roles of foreign and domestic banks in shielding the financial system against external shocks and (2) the potential costs of adopting blanket international financial regulations that do not account for a country's degree of development. Taken together, the lessons in this paper bring a new sense of optimism for growth in Latin America.
  • Topic: Economics, International Trade and Finance, Financial Crisis
  • Political Geography: Latin America
  • Publication Date: 02-2010
  • Content Type: Working Paper
  • Institution: Oxford Economics
  • Abstract: Following the worst recession since the 1930s, the US, UK and Eurozone economies have all now returned to positive growth. With the boost from policy stimulus and the inventory cycle peaking, however, this raises questions about the sustainability of the current rebound. The analysis presented here suggests that the recoveries in both the US and Europe will be relatively muted compared to recent historical experience. The US is likely to be the growth leader, reflecting the more dynamic nature of its economy and financial sector. A key uncertainty relates to how labour markets will perform during the recovery phase. To date, the rise in US unemployment been particularly severe when compared to the experience of Europe. In light of the sharp falls in European productivity, we expect employment gains in Europe to be more muted in the recovery phase than in the US. The performance of residential real estate markets also remains important. Home prices in the US are now close to fair value by most metrics, suggesting that the correction in prices is likely to be bottoming out. In Europe, only Spain and Ireland appear to be in the midst of substantial housing market corrections. Commercial real estate markets are also facing ongoing corrections in many countries. While conditions in the US and Eurozone may deteriorate further, commercial property values appear to be stabilising in the UK following earlier sharp declines. The ability of the banking sector to finance the economic recoveries in the US and Europe remains a key risk to the growth outlook. As the process of absorbing credit losses and rebuilding capital is likely to be protracted, the normalisation of lending standards is likely to take longer than following recent recessions. This is a particular concern for the Eurozone, where bank funding is more important for companies. Whether domestic demand in the US and Europe recovers will also depend on whether private sector deleveraging has further to run. The destruction of household net wealth in the US suggests that the personal savings rate has further to rise, whereas there no longer appears to be a pressing need for households in the UK and Eurozone to consolidate their balance sheets. In contrast, non-financial corporations in the US are in a stronger financial position than their European peers, having not increased debt levels as rapidly during the credit boom. Risks around public finances have received the most attention in recent weeks. In particular, the adjustments underway in Greece pose a risk of potential contagion from sovereign credit risk that could threaten growth on both sides of the Atlantic.
  • Topic: Economics, Markets, Financial Crisis
  • Political Geography: United States, United Kingdom, Europe
  • Publication Date: 02-2010
  • Content Type: Working Paper
  • Institution: Oxford Economics
  • Abstract: Greece has slid into a serious fiscal crisis over the last few months. A ballooning budget deficit and high levels of government debt have raised questions in the minds of investors about the sustainability of the country's public finances. The level of concern among investors can be seen from developments in Greek borrowing costs relative to those in Germany. At the beginning of 2008, the yield on Greek 10-year bonds was only around 0.3% higher than on equivalent German securities, but this gap has now risen to over 3%. This yield spread is at its widest for more than a decade and is by far the largest within the Eurozone. The root cause of Greece's problems is a long period of fiscal indiscipline. In 2009, after years of heavy spending, the budget deficit rose to almost 13% of GDP and the public debt to GDP ratio is set to reach 125% this year. The deteriorating fiscal position has led to a slew of ratings downgrades, and outside the Eurozone Greece's credit rating would probably be in 'junk' territory. On top of the fiscal problems, Greece also suffers from weak external competitiveness. The real exchange rate has appreciated substantially since Greece joined the Eurozone, contributing to a sharp widening in the current account deficit to around 12% of GDP last year. On some estimates, the real effective exchange rate is now around 20% overvalued. As a result Greece now faces a series of policy choices all of which look unpalatable. Within the Eurozone, the only realistic orthodox option is a combination of massive fiscal retrenchment and 'internal devaluation' – forcing down costs relative to those of Greece's competitors. But fiscal cutbacks and cost deflation on the scale required could plunge the country into a deep and prolonged recession and might prove politically and socially unsustainable. The Greek economy is already showing signs of serious stress, with GDP down 2.6% on the year in 2009Q4. The extreme alternatives are default and/or leaving the Eurozone and enacting devaluation. But the political barriers to such moves are immense, and while default and devaluation could ease budgetary and external imbalance problems, they would also cause massive economic and financial disruption and probably a deeper recession in the near-term. Default and devaluation would also risk huge negative contagion effects on the Eurozone and the wider global economy. With Greece's debt approaching €300 billion a default would be the largest sovereign collapse since WWII, dwarfing those in Russia and Argentina. Eurozone banks could face losses of up to €100 billion on top of the heavy writedowns already suffered, risking a renewed Europe-wide credit squeeze. There could also be collapses in demand for the debt of other weaker Eurozone members such as Spain, Portugal and Ireland. World markets for equities, corporate bonds and emerging market debt would also likely be badly affected. There could also be pressure for the major economies to accelerate their fiscal adjustment efforts, given the impact on investor confidence and the scale of their budget deficits. Our estimation results suggest that a Greek default could be a real threat to the progress of the global recovery, cutting growth in the major economies by around 1% per annum compared to our baseline forecast and world growth by 0.6%. Given the potential massive consequences of a Greek default, the pressure for a bailout has been growing. Although there are questions about the legality of such a move, we believe it is possible if the political will exists. Estimation results using the Oxford Model suggest a bailout would be likely to be less economically damaging than a default, even assuming some negative impact from higher bond yields in the core Eurozone countries. The costs of a bailout could rise rapidly, however, if it extended beyond Greece to other troubled countries. A bailout would create a big risk of moral hazard, perhaps inducing fiscal misbehaviour among other Eurozone members or being used by Greece to sidestep the necessary adjustment. To avoid this, any bailout would have to incorporate strict conditionality, perhaps raising serious questions about fiscal sovereignty within the Eurozone. Over the last two weeks, the other EU countries have taken a relatively hard line with Greece, stopping short of announcing explicit financial support and pushing for strong fiscal adjustment measures. Although a bailout remains the most likely outcome if Greece struggles to refinance its debts, there are some signs that political resistance to such a move is growing. The key risk period could be April-May, when a large volume of Greek debt matures.
  • Topic: Economics, Markets, Financial Crisis
  • Political Geography: Europe, Greece, Argentina
  • Publication Date: 02-2010
  • Content Type: Working Paper
  • Institution: Council on Foreign Relations
  • Abstract: Many people argue that inappropriate compensation policies in financial companies contributed to the World Financial Crisis. Some say the overall level of pay was too high. Others criticize the structure of pay, claiming that contracts for CEOs, traders, and other key professionals induced them to pursue excessively risky and short-term strategies.
  • Topic: Economics, Markets, Financial Crisis, Governance
  • Publication Date: 03-2010
  • Content Type: Working Paper
  • Institution: International Crisis Group
  • Abstract: Madagascar est en crise depuis les troubles sanglants qui l'ont secoué début 2009. Plusieurs mois de médiation sous l'égide de l'Union africaine (UA), entre autres, n'ont pas permis de débloquer la situation. Malgré la signature de plusieurs documents, et l'annonce de l'Union africaine de sanctions individuelles contre les membres du regime le 17 mars, les négociations n'ont pas abouti, principalement à cause du refus du gouvernement Rajoelina de mettre en oeuvre le partage du pouvoir accepté à Maputo en août. Bien que la violence ait été contenue depuis qu'il a pris le pouvoir en mars 2009, la légitimité du régime est remise en question tant à l'intérieur du pays qu'à l'extérieur, alors qu'une situation économique difficile pèse lourdement sur une population déjà appauvrie. Pour éviter toute escalade, la médiation devrait cesser d'essayer de mettre en place une transition fondée sur un partage du pouvoir, et tenter plutôt d'obtenir un accord sur la rédaction consensuelle d'une nouvelle constitution et l'organisation rapide d'élections sous supervision internationale
  • Topic: Political Violence, Economics, Environment, Armed Struggle
  • Political Geography: Africa
  • Author: Robert Kappel, Ulrich Mückenberger, Cord Jakobeit
  • Publication Date: 01-2010
  • Content Type: Working Paper
  • Institution: German Institute of Global and Area Studies
  • Abstract: Civil society organizations, epistemic communities, and lobby groups—what we call transnational norm-building networks—are influencing the global economy and global politics more than ever before. We argue that such transnational norm-building networks, in contrast to the dominating executive intergovernmental elites and democratically deficient supranational bodies, hold the scope and potential for a more civilized world order. They are—together with states and international governmental organizations—creating new norms; they are setting standards. They associate the voice of stakeholders with decision-making processes, thus leading to an increase in legitimate world governance.
  • Topic: Civil Society, Economics, Globalization, International Organization
  • Political Geography: Europe
  • Author: Heike Holbig, Bruce Gilley
  • Publication Date: 03-2010
  • Content Type: Working Paper
  • Institution: German Institute of Global and Area Studies
  • Abstract: The contemporary politics of China reflect an ongoing effort by the ruling Chinese Communist Party (CCP) to claim the right to rule in light of the consequences of economic development, international pressures, and historical change. China stands out within the Asian region for the success the regime has achieved in this effort. By focusing on the changes in China elite discourse during the reform period and particularly during the last decade, this paper aims to elaborate on the relative importance of various sources of legitimacy as they shift over time, as well as on their inherent dilemmas and limitations. There is evidence of an agile, responsive, and creative party effort to relegitimate the post-revolutionary regime through economic performance, nationalism, ideology, culture, governance, and democracy. At the same time, the paper identifies a clear shift in emphasis from an earlier economic‐nationalistic approach to a more ideological-institutional approach.
  • Topic: Communism, Development, Economics, Politics
  • Political Geography: China, Asia
  • Author: Noriko Fujiwara
  • Publication Date: 03-2010
  • Content Type: Working Paper
  • Institution: Centre for European Policy Studies
  • Abstract: This Working Document complements the CEPS Policy Brief, Understanding India's climate agenda, and elaborates on three key issues related to the country's energy challenges: access to energy, the future emissions trajectory and energy subsidies. This study looks into the making and framing of the country's domestic climate agenda from a political economy perspective. As long as both GDP and primary energy demand keep growing at the current rates, it may be concluded that the country's future, absolute greenhouse-gas emissions are also likely to grow but remain relatively low. Moreover, India's emissions intensity is expected to continue declining in line with the recent voluntary pledge by the Indian government. The study takes note of the national action plan launched in India, and the adoption of a flexible approach in international negotiations while maintaining a preference for several core principles, including equity. Lastly, the study explores the possibility for addressing issues such as international and intra-national equity in the context of the long-term EU–Indian partnership.
  • Topic: Climate Change, Development, Economics, Energy Policy, Industrial Policy
  • Political Geography: India
  • Author: Daniel Gros
  • Publication Date: 03-2010
  • Content Type: Working Paper
  • Institution: Centre for European Policy Studies
  • Abstract: This paper describes the key economic variables and mechanisms that will determine the adjustment process in those euro area countries now under financial market pressure. (Greece, Ireland, Portugal, Spain and Italy = GIPSY) The key finding is that the adjustment will be particularly difficult for Greece (and Portugal) because these are two relatively closed economies with low savings rates. Both of these countries are facing a solvency problem because they combine high debt levels with low growth and high interest rates. Fiscal and external adjustment is thus required for sustainability, not just to satisfy the Stability Pact. By contrast, Ireland and Spain face more of a liquidity than a solvency problem. Italy seems to have a much better starting position on all accounts. Fiscal adjustment alone will not be sufficient to ensure sustainability. Without significant reductions in labour costs, these economies will face years of stagnation at best. Especially in the case of Greece, it is imperative that the cuts in public sector wages are transmitted to the entire economy in order to restore competitiveness, and thus ensure that export growth can become a vital safety valve. Without an adjustment of wages in the private sector, the adjustment will become so difficult that failure cannot be excluded.
  • Topic: Debt, Economics, Monetary Policy, Financial Crisis
  • Political Geography: Europe, Greece, Spain, Italy, Portugal, Ireland
  • Author: Diego Valiante
  • Publication Date: 02-2010
  • Content Type: Working Paper
  • Institution: Centre for European Policy Studies
  • Abstract: Investors have a longer memory than the sell‐side of the market. To regain their trust, intensive work needs to be done in the coming years. The new European Commissioner of the Internal Market, Michel Barnier, will play a pivotal role here. In the area of capital markets, he will need the support of a determined European Parliament, a strong commitment from the Council and Member States, as well as active contributions from the CESR/ESMA , other Level 3 Committees/Authorities and national supervisors. We believe that participants in capital markets share the same goal: to make them as efficient and effective as possible. The ability to collect savings and allocate them to investment, and to allow all participants to defray risk, is at the heart of any successful modern economy. This requires effective regulation that not only mandates common standards, but also promotes accountability, responsibility and transparency, while at the same time encouraging innovation. Effective regulation must not impose undue costs, if markets are to remain efficient and effective. However, we should be conscious that the crisis has been so deep that there is a collective need to go back to the basic principles of financial regulation and supervision.
  • Topic: Economics, International Trade and Finance, Financial Crisis
  • Political Geography: Europe
  • Author: Caterina Giannetti, Nicola Jentzsch, Giancarlo Spagnolo
  • Publication Date: 02-2010
  • Content Type: Working Paper
  • Institution: Centre for European Policy Studies
  • Abstract: Asymmetries can severely limit the cross-border border expansion of banks, if entering banks can only obtain incomplete information about potential new clients. Such asymmetries are reduced by credit registers, which distribute financial data on bank clients. Asymmetrically distributed information and adversely selected pools of borrowers constitute severe barriers for foreign banks when they enter new markets. In many instances, these problems force banks to either form 'alliances with incumbents' or simply enter through mergers and acquisitions (M). Yet such entry modes do not automatically lead to intensified competition as they may leave the number of competitors unchanged. Thus, institutions that reduce information asymmetries in credit markets (thereby encouraging entry through branches) may be very important if the objective is strengthening competition in addition to market integration. Recently, these institutions – credit registers – have received greater attention among academics and policy-makers in Europe, although there is still a remarkable lack of understanding of their empirical impact on banking.
  • Topic: Economics, International Trade and Finance, Markets, Monetary Policy
  • Political Geography: Europe
  • Author: Jens Chr.1 Andvig, Gbewopo Attila
  • Publication Date: 03-2010
  • Content Type: Working Paper
  • Institution: Norwegian Institute of International Affairs
  • Abstract: Recently economists have begun to study various aspects of public sector institutions (with their behavioral neighborhoods) and their effects on the long run economic development. Degrees of corruption, rule of law and protection of property rights have all apparently significant economic impact. These results are all based on the construction of indicators for these difficult-to-observe explanatory variable complexes. In most cases the indicators applied have been developed for most countries and have on the one hand 'nice' statistical properties when embedded in regression equations, but on the other hand are conceptually fuzzy with unclear relationships to basic observations. In this paper we go through many of the same relationships, but based on international efforts to collect questionnaire information about citizens' experience with crime and police corruption. This information is more conceptually distinct and likely to be more closely related to relevant experience, but proves on the other hand less amenable to econometric analysis. Despite the latter weakness we have found it worthwhile to pursue it in order to complement the indicator- based approaches.
  • Topic: Corruption, Crime, Economics, Law
  • Author: Adam B. Schaeffer
  • Publication Date: 03-2010
  • Content Type: Working Paper
  • Institution: The Cato Institute
  • Abstract: Although public schools are usually the biggest item in state and local budgets, spending figures provided by public school officials and reported in the media often leave out major costs of education and thus understate what is actually spent.
  • Topic: Economics, Education, Government, Monetary Policy
  • Author: Hakan Altinay
  • Publication Date: 03-2010
  • Content Type: Working Paper
  • Institution: The Brookings Institution
  • Abstract: “Civics” often refers to the familiar constellation of rights and responsibilities emanating from citizenship in a nation-state. But what about global civics? Would this be feasible—or even desirable?
  • Topic: International Relations, Civil Society, Economics, International Cooperation
  • Publication Date: 03-2010
  • Content Type: Working Paper
  • Institution: International Crisis Group
  • Abstract: Haiti's earthquake produced enormous devastation that threatens political and socio-economic stability and poses huge recovery and reconstruction challenges. Historical institutional and governance weaknesses and deep poverty compound a major humanitarian crisis that could become very difficult to control if the security environment deteriorates further with the approaching rainy and hurricane seasons. The disaster prompted postponement of legislative elections and casts uncertainty over whether presidential elections can be held at year's end as planned. After mid-May, the legislature will have left office, and the country will be missing critical parts of its institutional anatomy. The government must thus reach out now to civil, political and economic society to forge a robust consensus on how democracy can be upheld until elections without sacrificing the incumbent's ability to take tough and urgent decisions on reconstruction. These need to be based on a Haitian-led long-term strategy supported by all sectors of society and the international community and pay due attention to restoring security and rule of law.
  • Topic: Disaster Relief, Economics, Poverty, Foreign Aid
  • Political Geography: Caribbean, Haiti
  • Author: Kimberly Elliott, Antoine Bouët, David Laborde Debucquet, Elisa Dienesch
  • Publication Date: 03-2010
  • Content Type: Working Paper
  • Institution: Center for Global Development
  • Abstract: This paper examines the potential benefits and costs of providing duty-free, quota-free market access to the least developed countries (LDCs), and the effects of extending eligibility to other small and poor countries. Using the MIRAGE computable general equilibrium model, it assesses the impact of scenarios involving different levels of coverage for products, recipient countries, and preference-giving countries on participating countries, as well as competing developing countries that are excluded. The main goal of this paper is to highlight the role that rich and emerging countries could play in helping poor countries to improve their trade performance and to assess the distribution of costs and benefits for developing countries and whether the potential costs for domestic producers are in line with political feasibility in preference-giving countries.
  • Topic: Economics, International Political Economy, International Trade and Finance, Markets, Third World
  • Author: Nancy Birdsall
  • Publication Date: 03-2010
  • Content Type: Working Paper
  • Institution: Center for Global Development
  • Abstract: Inclusive growth is widely embraced as the central economic goal for developing countries, but the concept is not well defined in the development economics literature. Since the early 1990s, the focus has been primarily on pro-poor growth, with the "poor" being people living on less than $1 day, or in some regions $2 day. The idea of pro-poor growth emerged in the early 1990s as a counterpoint to a concern with growth alone (measured in per-capita income) and is generally defined as growth which benefits the poor as much or more than the rest of the population. Examples include conditional cash transfers, which target the poor while minimizing the fiscal burden on the public sector, and donors' emphasizing primary over higher education as an assured way to benefit the poor while investing in long-term growth through increases in human capital. Yet these pro-poor, inclusive policies are not necessarily without tradeoffs in fostering long-run growth. In this paper I argue that the concept of inclusive growth should go beyond the traditional emphasis on the poor (and the rest) and take into account changes in the size and economic command of the group conventionally defined as neither poor nor rich, i.e., the middle class.
  • Topic: Economics, International Political Economy, Poverty, Foreign Aid
  • Author: Kimberly Ann Elliott
  • Publication Date: 04-2010
  • Content Type: Working Paper
  • Institution: Center for Global Development
  • Abstract: Trade preference programs are an important and underused tool for stimulating exports, creating jobs, reducing poverty, and promoting prosperity and stability in poor countries. While many rich countries provide special access for exports from the least developed countries (LDCs) to promote these benefits, the trade preferences often do not extend to the products that matter most to LDCs, such as agriculture and clothing. Improving these programs could make a major difference in the lives of the poor, while having minimal effects on production or exports in preference-giving countries because the affected trade is so small: less than 1 percent of global exports are from LDCs. And, in the longer term, improved trade preferences for LDCs will promote shared prosperity and stability in rich and poor countries alike. Recognizing the role of trade in poverty reduction, the UN's Millennium Development Goals (MDGs) for poor countries call on high-income countries to provide duty-free, quota-free market access for the LDCs.
  • Topic: Development, Economics, International Political Economy, International Trade and Finance, Poverty, Third World
  • Author: Jenny C. Aker, Michael W. Klein, Stephen A. O'Connell, Muzhe Yang
  • Publication Date: 04-2010
  • Content Type: Working Paper
  • Institution: Center for Global Development
  • Abstract: This paper addresses two important economic issues for Africa: the contribution of national borders and ethnicity to market segmentation and integration between and within countries. Market pair regression analysis provides evidence of higher conditional price dispersion for both a grain and a cash crop between markets separated by the Niger-Nigeria border than between two markets located in the same country. A regression discontinuity analysis also confirms a significant price change at the international border. The international border effect is lower, however, if the cross-border markets share a common ethnicity. Ethnicity is also linked to higher price dispersion within Niger; we find a significant intranational border effect between markets in different ethnic regions of the country. This suggests that ethnic similarities diminishing international border effects could enhance international market integration, and ethnic differences could contribute to intranational market segmentation in sub-Saharan Africa. We provide suggestive evidence that the primary mechanism behind the internal border effect is related to the role of ethnicity in facilitating access to credit in agricultural markets. We argue that the results are not driven by differences in price volatility or observables across borders.
  • Topic: Agriculture, Economics, Ethnic Conflict, Markets
  • Political Geography: Africa, West Africa, Nigeria
  • Publication Date: 03-2010
  • Content Type: Working Paper
  • Institution: Oxfam Publishing
  • Abstract: In October 2009, Oxfam and the European Women's Lobby (EWL) commissioned research to explore and analyse the hidden impact of the current economic recession on women's poverty in EU countries. The research was conducted with EWL member organisations, and supplemented with other research and information available at the end of 2009.
  • Topic: Economics, Gender Issues, Poverty, Financial Crisis
  • Political Geography: Europe
  • Publication Date: 04-2010
  • Content Type: Working Paper
  • Institution: Council on Foreign Relations
  • Abstract: Runs by prime-brokerage clients and derivatives counterparties were a central cause of the World Financial Crisis. Worried about potential losses, many hedge funds withdrew their assets from brokerage accounts at Bear Stearns and Lehman Brothers in the weeks before these banks failed. Although Morgan Stanley did not fail, it also suffered from the withdrawal of prime brokerage assets. These runs, together with runs by short-term creditors, precipitated Bear Stearns' and Lehman's demise. Even if these firms would have failed anyway, the runs made their failures much more sudden and chaotic, and made coherent policy responses much harder.
  • Topic: Economics, Markets, Financial Crisis
  • Political Geography: United States
  • Author: Jeffrey Mankoff
  • Publication Date: 04-2010
  • Content Type: Working Paper
  • Institution: Council on Foreign Relations
  • Abstract: Like much of the world, Russia has been in the midst of a serious economic crisis since the late summer of 2008. Although the worst appears to be over, Russia will continue to feel its effects longer than many other industrialized countries, largely because of a rigid economy burdened with an overweening state role. The recognition that Russia faces serious long-term challenges has emboldened President Dmitry Medvedev and others to call for far-reaching economic restructuring. If successful, their economic policies could undermine the semi-authoritarian, state-capitalist model developed under Prime Minister and former president Vladimir Putin. Although concrete reforms have so far been limited, Medvedev's demands for change (seconded in some cases by Putin) have acquired increasing momentum in recent months. The speed of Russia's recovery and obstacles along the way will play a major role in determining both the success of Medvedev's call for modernization and the course of Russia's foreign policy since a quicker recovery would diminish the pressure for fundamental reform and lessen the need for caution internationally.
  • Topic: International Relations, Foreign Policy, Economics, International Affairs, Financial Crisis
  • Political Geography: Russia
  • Author: Jennifer L. Hochschild
  • Publication Date: 01-2010
  • Content Type: Working Paper
  • Institution: Weatherhead Center for International Affairs, Harvard University
  • Abstract: One possible outcome of the economic crash of 2008 was that the majority or mainstream members of a society would direct their anger and fear against the minority or marginal members of their society. Commentators on television or the radio would claim, "it's all the fault of the immigrants!" or "if we didn't hand over so much of our tax dollars to the poor, the economy would not have deteriorated so much," or "social benefits to African Americans [or German Turks] have distorted the housing market." Citizens would come to believe these assertions, politicians would echo them – and the upshot would be not only a deteriorating national and international economy but also increased hostility and fear among racial, ethnic, or nationality groups in a country. Social solidarity would decline, perhaps irrevocably.
  • Topic: International Relations, Economics, Politics, Social Stratification, Financial Crisis
  • Political Geography: Africa, America, Europe, Germany
  • Author: Robert Mosbacher, Jr.
  • Publication Date: 05-2010
  • Content Type: Working Paper
  • Institution: The Brookings Institution
  • Abstract: To tackle global poverty, it is essential to craft a new and dynamic approach to economic development that refl ects the realities of a 21st century global economy and incorporates the participation of a wide variety of new players, particularly from the private sector. While investment, trade and innovation all represent basic components of building healthy economies, this paper focuses primarily on strategies to increase both in-country and international private capital investment in order to create jobs. To that end, it concentrates on two areas: strengthening and reforming the existing structures, coordinating mechanisms and policies that support U. S. economic development efforts; and improving public-private partnership models to promote broader fi nancing to local businesses, greater human capital support and technical assistance and improved physical and ICT infrastructure.
  • Topic: Foreign Policy, Development, Economics, Emerging Markets, Poverty, Third World
  • Political Geography: United States
  • Author: Sven Behrendt
  • Publication Date: 05-2010
  • Content Type: Working Paper
  • Institution: Carnegie Endowment for International Peace
  • Abstract: Sovereign wealth funds (SWFs) have become dominant players in global finance and world affairs, controlling considerable financial assets. Their investment behavior continues to resonate across the world economy and their increasingly extroverted investment policy prompted a political backlash in mature economies. Reacting to this backlash, in October 2008 a group of 26 SWFs commit-ted themselves to transparency, good governance, and accountability standards by signing a voluntary code of principles, the “Generally Accepted Principles and Practices,” for SWFs (GAAP), also known as the “Santiago Principles.”
  • Topic: International Relations, Economics, Treaties and Agreements, Sovereign Wealth Funds
  • Author: Andrew Selee, Katie Putnam, Christopher Wilson
  • Publication Date: 05-2010
  • Content Type: Working Paper
  • Institution: The Woodrow Wilson International Center for Scholars
  • Abstract: No country in the world affects daily life in the United States more than Mexico. The two countries are deeply intertwined, and what happens on one side of the border necessarily has consequences on the other side. Almost one in ten Americans is of Mexican descent, and a third of all immigrants in the United States today are from Mexico, while well over a half-million Americans live in Mexico. Mexico remains the second destination for U.S. exports after Canada, and millions of American jobs depend on this trade. From south to north the linkages are even greater: over three quarters of Mexico's exports go to the United States and one in ten Mexicans lives in the United States.
  • Topic: Economics, Emerging Markets, Politics, Regional Cooperation, Bilateral Relations, Immigration, Law Enforcement
  • Political Geography: United States, Canada, Central America, Mexico
  • Author: Joseph Wright
  • Publication Date: 05-2010
  • Content Type: Working Paper
  • Institution: Kellogg Institute for International Studies
  • Abstract: Does economic crisis lead to authoritarian regime breakdown and democratization? In this paper, I argue that the availability of exit options for citizens conditions the relationship between economic crisis and democratization. Where citizens have more viable exit alternatives, economic crisis causes citizens to exit rather than protest, making democratization less likely. I measure exit options in three ways: a geographic instrument for bilateral trade; neighboring country GDP per capita; and past net migration. I use time series, cross - section data on up to 122 authoritarian regimes in 114 countries from 1946 – 2002 to test this argument and find evidence consistent with the hypothesis that more attractive exit options insulate dictators from the liberalizing effects of economic crisis.
  • Topic: Democratization, Economics, Government, Political Theory, Financial Crisis, Authoritarianism
  • Author: Nancy Birdsall, Augusto de la Torre, Felipe Valencia Caicedo
  • Publication Date: 05-2010
  • Content Type: Working Paper
  • Institution: Center for Global Development
  • Abstract: In this paper we analyze the Washington Consensus, which at its original formulation reflected views not only from Washington but also from Latin America. We trace the life of the Consensus from a Latin American perspective in terms of evolving economic development paradigms. We document the extensive implementation of Consensus-style reforms in the region as well as the mismatch between reformers' expectations and actual outcomes, in terms of growth, poverty reduction, and inequality. We then present an assessment of what went wrong with the Washington Consensus-style reform agenda, using a taxonomy of views that put the blame, alternatively, on (i) shortfalls in the implementation of reforms combined with impatience regarding their expected effects; (ii) fundamental flaws—in either the design, sequencing, or basic premises of the reform agenda; and (iii) incompleteness of the agenda that left out crucial reform needs, such as volatility, technological innovation, institutional change and inequality.
  • Topic: Economics
  • Political Geography: Washington, Latin America
  • Author: Jenny C. Aker, Isaac M. Mbiti
  • Publication Date: 06-2010
  • Content Type: Working Paper
  • Institution: Center for Global Development
  • Abstract: We examine the growth of mobile phone technology over the past decade and consider its potential impacts upon quality of life in low-income countries, with a particular focus on sub-Saharan Africa. We first provide an overview of the patterns and determinants of mobile phone coverage in sub-Saharan Africa before describing the characteristics of primary and secondary mobile phone adopters on the continent. We then discuss the channels through which mobile phone technology can impact development outcomes, both as a positive externality of the communication sector and as part of mobile phone-based development projects, and analyze existing evidence. While current research suggests that mobile phone coverage and adoption have had positive impacts on agricultural and labor market efficiency and welfare in certain countries, empirical evidence is still somewhat limited. In addition, mobile phone technology cannot serve as the “silver bullet” for development in sub-Saharan Africa. Careful impact evaluations of mobile phone development projects are required to better understand their impacts upon economic and social outcomes, and mobile phone technology must work in partnership with other public good provision and investment.
  • Topic: Economics
  • Political Geography: Africa
  • Author: Michael Clemens
  • Publication Date: 06-2010
  • Content Type: Working Paper
  • Institution: Center for Global Development
  • Abstract: This study uses a unique natural experiment to test a simple model of international differences in workers' wages and productivity. Large differences in wages across countries could arise from several sources. These include barriers to trade in outputs, differences in technology, differences in workers, or differences in the other factors of production accessible in different countries. To measure the relative importance of these sources in one setting, this study exploits the randomized processing of U.S. visas for a group of Indian workers who produce software within a single multinational firm. In this setting, international barriers to trade in outputs, barriers to technology transfer, and all observable or unobservable differences between workers are extremely low. The results indicate that location outside of India causes a sixfold increase in the wages of the same worker using the same technology to produce a highly tradable good. Under plausible assumptions about competition in the industry, this suggests that country-of-work by itself is responsible—in this industry—for roughly three-quarters of the gap in productivity between workers in India and workers in the richest countries. These findings have implications for open questions in labor, growth, international, and development economics.
  • Topic: Economics, Labor Issues
  • Political Geography: United States, India
  • Author: James A. Lewis, Sarah O. Ladislaw, Denise E. Zheng
  • Publication Date: 06-2010
  • Content Type: Working Paper
  • Institution: Center for Strategic and International Studies
  • Abstract: Until this year, America's civil space policies—and the budgets that derive from it—were shaped to a considerable degree by the political imperatives of the past and by the romantic fiction of spaceflight. We believe there is a new imperative—climate change—that should take precedence in our national plans for space and that the goal for space spending in the next decade should be to create a robust and adequate Earth observation architecture.
  • Topic: Climate Change, Economics, Natural Disasters
  • Political Geography: America
  • Author: Anthony H. Cordesman
  • Publication Date: 03-2010
  • Content Type: Working Paper
  • Institution: Center for Strategic and International Studies
  • Abstract: Economics are as important to Iraq's stability and political accommodation as security and governance, and they are equally critical to creating a successful strategic partnership between Iraq and the United States. It is far from easy, however, to analyze many of the key factors and trends involved. Iraqi data are weak and sometimes absent. U.S. and Coalition forces generally failed to look in detail at many of Iraq's most serious economic problems, or they issued heavily politicized reports designed to show that Iraqi “reconstruction” had been far more successful than it really was.
  • Topic: Economics
  • Political Geography: United States, Iraq, Middle East
  • Author: Keith C. Smith
  • Publication Date: 02-2010
  • Content Type: Working Paper
  • Institution: Center for Strategic and International Studies
  • Abstract: It is my thesis that the national security risk posed by Russian energy policies are only tangentially related to Europe's dependency on Russian energy imports. The primary energy risk to Europe, and especially to the newer EU members, stems from the corrosive effect this dependency has on governance and on transatlantic cooperation. Moscow's divide-and-conquer tactics have successfully prevented greater inter-European cooperation on both economic and security issues. As we shall see, these factors have added to already existing strains in the U.S.-Europe relationship. Further NATO enlargement has been stopped, in part, due to Moscow's energy ties with the wealthier Western European states. It is in the U.S. interest to assist those Eastern and Central European (ECE) states that are highly dependent on Russian energy imports and are most susceptible to imported corruption. Kremlin officials, supported by 60 percent of Russian public opinion, favor reestablishing Soviet-era control or influence over ECE countries. The threat to the sovereignty of these new democracies cannot be dismissed.
  • Topic: Economics
  • Political Geography: Russia, United States, Europe, Moscow
  • Author: Paul J. Sullivan, Natalie Nasrallah
  • Publication Date: 06-2010
  • Content Type: Working Paper
  • Institution: United States Institute of Peace
  • Abstract: Most experts view secession as the most likely outcome of the 2011 referendum on southern Sudan's potential secession. While this scenario may lead to some stability in the long run, effective secession immediately after the referendum may prove difficult. There is significant concern about preparedness for the referendum at the national, regional, and community levels. While postponing the vote may provide some breathing room, it heightens the risk of uncertainty and instability. Each plausible scenario—unity, secession, or a delay to the referendum—holds great uncertainty and risk regarding the potential impacts on oil, land, and water. The effects of each scenario could drastically change if the political and economic situations on the ground become more fragile. Management of petroleum resources is one of the most serious challenges facing Sudan's leaders. Petroleum is the largest foreign exchange earner and the biggest contributor to fiscal revenues for both north and south. Potential flash points include revenue transparency and equitable sharing formulas, as well as financing for exploration, production, new infrastructure development, and maintenance of existing infrastructure. There are insufficient data on, and attention to, use and potential of land and water. The management of both resources poses serious challenges that could derail statehood and precipitate violence. If oil, water, and land are not managed and developed properly and sustainably, both north and south Sudan could be facing a much more uncertain and violent future.
  • Topic: Economics, Politics
  • Political Geography: Sudan
  • Author: Francis E. Warnock
  • Publication Date: 06-2010
  • Content Type: Working Paper
  • Institution: Council on Foreign Relations
  • Abstract: In 1961, the Belgian economist Robert Triffin described the dilemma faced by the country at the center of the international monetary system. To supply the world's risk-free asset, the center country must run a current account deficit and in doing so become ever more indebted to foreigners, until the risk-free asset that it issues ceases to be risk free. Precisely because the world is happy to have a dependable asset to hold as a store of value, it will buy so much of that asset that its issuer will become unsustainably burdened. The endgame to Triffin's paradox is a global, wholesale dumping of the center country's securities. No one knows in advance when the tipping point will be reached, but the damage brought about by higher interest rates and slower economic growth will be readily apparent afterward.
  • Topic: Economics, Globalization, International Trade and Finance, Markets
  • Author: Almut Schilling-Vacaflor
  • Publication Date: 07-2010
  • Content Type: Working Paper
  • Institution: German Institute of Global and Area Studies
  • Abstract: In Bolivia, rights to increased political participation and the recognition of indigenous political systems are interrelated. The new constitution of 2009, a prime example of the “new Andean constitutionalism,” defines Bolivia as a representative, participatory and communitarian democracy. It incorporates enhanced mechanisms and institutions for participatory democracy. Moreover, new social rights have been anchored in the constitution and a plurinational state is supposed to be constructed. The article raises the question of whether the new constitution will change the relations between state and civil society considerably and whether a new democratic model is being established in Bolivia. I argue that there are many limiting factors when it comes to putting the emancipatory elements of the constitution into practice. These include the increased strength of the executive branch, the intent of the government to co‐opt civil society organizations and to exclude dissident views, the resistance of the conservative opposition to loosing some of its privileges, the deep‐rooted social inequality, the social conflicts and polarization, the resource dependence of the current economic model, and the authoritarian characteristics of indigenous self‐governance structures. The article demonstrates that the new Bolivian constitution cannot create a new society but that the processes around the elaboration of a new basic law have contributed to considerable changes in the social, political and symbolic order.
  • Topic: Civil Society, Economics
  • Political Geography: Latin America, Bolivia