Content Type: Working Paper / Topic:

301. Assessing Digital Leadership: Is the EU Losing out to the US?

Author:: Dario Guarascio and Roman Stöllinger
Publication Date:: 03-2023
Content Type:: Working Paper
Institution:: The Vienna Institute for International Economic Studies (WIIW)
Abstract:: Since Leontief’s (1953) seminal work on the factor content of trade, the validity of the Heckscher-Ohlin-model has been judged not only on the basis of formal tests of the theory but also tested against prior expectation. In this vein, this paper uses the Heckscher-Ohlin-Vanek (HOV) approach to investigate whether supposed US leadership in the digital domain can be traced back to digital task endowments embodied in labour services. In a comparison between EU member states and the US, we find that the latter is more intensive in digital tasks than the EU and that this difference is explained by both an intensity-effect (US occupations being more digital-task intensive) and a structural component (relatively more digital-task intensive occupations). Viewed through the lens of the HOV theorem we find that the US is abundant in digital tasks relative to non-digital tasks, while the opposite is true for the EU. The standard tests for the predictive power of the HOV theorem are high and in line with the results for labour in previous literature.
Topic:: International Trade and Finance, Foreign Direct Investment, European Union, Digitalization, and Competition
Political Geography:: Europe and United States of America

302. Employment Effects of Offshoring, Technological Change and Migration in a Group of Western European Economies: Impact on Different Occupations

Author:: Michael Landesmann and Sandra Leitner
Publication Date:: 03-2023
Content Type:: Working Paper
Institution:: The Vienna Institute for International Economic Studies (WIIW)
Abstract:: This paper estimates conditional demand models to examine the impact of offshoring, technological change, and migration on the labour demand of native workers differentiated by four different types of occupational groups: managers/professionals, clerical workers, craft (skilled) workers and manual workers. The analysis is conducted for an unbalanced panel of five economies Austria, Belgium, France, Spain, and Switzerland covering the period 2005-2018. Our results point to important and occupation-specific effects: offshoring seems to have beneficial employment effects for native craft workers in this set of economies, while negative effects for native manual workers across a wide set of industries (including manufacturing and services industries) and managers/professionals in manufacturing. Furthermore, there are important distinctions whether offshoring occurs in other advanced economies, in the EU13 or in developing countries. The analysis of the impact of technological change shows the strong positive impact which the additional IT equipment has on most occupational groups of native workers (with the exception of manual workers), while robotisation in manufacturing showed strongly negative impacts on the employment of all groups of workers and especially of craft workers. Increasing immigrant shares in the work forces showed strongly negative impacts on native workers – however, considering only the partial substitution effects and not including the potential for productivity and demand effects – and this is mostly accounted for by immigration from low- to medium-income source countries.
Topic:: International Trade and Finance, Migration, Labor Issues, Immigration, Foreign Direct Investment, Employment, Competition, Income Distribution, and Offshoring
Political Geography:: Europe, France, Belgium, Spain, Switzerland, and Austria

303. Functional Specialisation and Working Conditions in Europe

Author:: Sandra Leitner, Roman Stöllinger, and Zuzana Zavarská
Publication Date:: 05-2023
Content Type:: Working Paper
Institution:: The Vienna Institute for International Economic Studies (WIIW)
Abstract:: Specialisation in value-chain functions is one of the new phenomena introduced by global value chains (GVCs). This report investigates the effects of functional specialisation on labour markets in fabrication and R&D activities as the two polar cases of value-chain functions, whereby the former is associated with factory economies, while the latter is characteristic of headquarter economies. More precisely, a metric similar to revealed comparative advantage is used to study the effect of relative functional specialisation on wages and non-wage working conditions. In line with the GVC literature emphasising power relations and organisational aspects of production networks, we are able to identify differentiated effects for functional specialisation patterns on wages in EU member states at the industry level across time. While relative functional specialisation in fabrication tends to hold back wages, functional specialisation in R&D has a positive effect on wage progression, controlling for labour productivity, GVC participation and numerous labour supply- and labour demand-side factors. The use of a constructed ‘sharp’ instrument allows giving these results a causal interpretation. Conversely, both functional specialisation measures are found to improve some non-wage working conditions, namely workers’ physical environment and their work intensity, which is evidence against a potential ‘race to the bottom’ effect of functional specialisation along GVCs. The effect is stronger for relative specialisation in fabrication than for relative specialisation in R&D.
Topic:: International Trade and Finance, Labor Issues, Foreign Direct Investment, European Union, Labor Market, Value Chains, and Wages
Political Geography:: Europe

304. Determinants of Functional Specialisation in EU Countries

Author:: Aleksandra Kordalska and Magdalena Olczyk
Publication Date:: 05-2023
Content Type:: Working Paper
Institution:: The Vienna Institute for International Economic Studies (WIIW)
Abstract:: This paper aims to identify factors that determine functional specialisation (FS) in global value chains (GVCs) in European Union countries. We focus on fabrication and R&D as two opposite business functions in terms of their character and their potential of creating value-added. To make our results robust two different approaches to measuring functional specialisation are used – an FDI-based approach and a trade-based approach. To assemble a relative functional specialisation index, for each approach we use the same metric – a revealed comparative advantages index. Our results suggest a positive effect of wages on specialisation in an R&D function, and a negative impact on FS in fabrication. Increasing labour productivity boosts both specialisation in fabrication and in R&D. The results are robust to different model specifications and different time intervals. The instrumental variables method allows us to interpret the results as causal relationships. Additionally, human capital and labour skills foster FS in R&D (only in FDI data), and growing employment makes FS in fabrication increase. The growth of GDP per capita positively affects functional specialisation in R&D activities. Among GVC participation measures, we confirm the importance of increasing backward linkages to explain the boost in fabrication activities. Dividing a full sample into a group of EU15 countries and a group of Central Eastern European countries we observe that patterns for the EU15 are similar to those for the full sample, while for CEE countries wages are insignificant and labour productivity affects FS in fabrication only.
Topic:: International Trade and Finance, Foreign Direct Investment, European Union, Economy, Value Chains, and Competition
Political Geography:: Europe

305. Regulatory Convergence within Technical Barriers to Trade

Author:: Mahdi Ghodsi
Publication Date:: 09-2023
Content Type:: Working Paper
Institution:: The Vienna Institute for International Economic Studies (WIIW)
Abstract:: This paper analyses how regulatory convergence in different categories of technical barriers to trade (TBTs) imposed on imports of goods in information and communications technology (ICT) globally affected the values, volumes, and unit values of imported goods during the period 1996-2019. Keywords cited in TBTs that are notified to the World Trade Organization (WTO) give an indication of the regulatory objectives behind the imposition of TBTs. MAST also classifies TBTs based on their applicability, procedural and administrative uses, factors which will also be taken into consideration in the analysis. However, objectives of TBTs may provide better insights to policymakers. TBTs are non-discriminatory measures that are imposed unilaterally on all trading partners and on domestic producers. It is not feasible to analyse unilateral TBTs in a gravity setting, as they are excluded by the introduction of country-product-time fixed effects that control for multilateral resistances. However, regulatory convergence in TBT categories is a bilateral time-varying variable that is analysed in a gravity model in this paper. The empirical results suggest that regulatory convergence between trading partners in some TBT categories stimulates import values and volumes. However, the impact is very heterogeneous across TBT objectives and classes and across ICT product categories.
Topic:: International Trade and Finance, Communications, World Trade Organization, Foreign Direct Investment, Regulation, Information Technology, and Competition
Political Geography:: Global Focus

306. Tradition and Protest: The Druze Community in Lebanese Politics

Author:: Moran Levanoni
Publication Date:: 08-2023
Content Type:: Working Paper
Institution:: Moshe Dayan Center for Middle Eastern and African Studies
Abstract:: In our new issue of al-Durziyya: Druze and Other Minorities in the Middle East, Dr. Moran Levanoni analyzes political trends among the Druze community and their impact on Lebanese politics in the last parliamentary election. This article suggests that the political, social, and economic crises Lebanon is going through affected voting patterns within the Druze community, allowing new members to participate instead of the old guard of traditional politicians.
Topic:: Politics, Minorities, Hezbollah, and Druze
Political Geography:: Middle East and Lebanon

307. Azerbaijan-Türkiye Military Relations in the Shadow of the Negotiations with Armenia

Author:: Cavid Veliyev
Publication Date:: 08-2023
Content Type:: Working Paper
Institution:: Moshe Dayan Center for Middle Eastern and African Studies
Abstract:: This issue of Turkeyscope focuses on the essence and the impact of the Azerbaijani-Turkish military alliance in the Caucasus. By analyzing the deepening collaboration between the two states, Dr. Cavid Veliyev of Azerbaijan’s Center for Analysis of International Relations (AIR Center) highlights the shifting balance of power in the region in favor of the Azerbaijan-Türkiye duo in the face of ongoing tension with Armenia.
Topic:: International Relations, Territorial Disputes, Alliance, Negotiation, and Regional Politics
Political Geography:: Turkey, Caucasus, and Azerbaijan

308. Turkey is not the US and Kılıçdaroğlu is not Obama

Author:: Hay Ertan Cohen Yanarocak
Publication Date:: 06-2023
Content Type:: Working Paper
Institution:: Moshe Dayan Center for Middle Eastern and African Studies
Abstract:: In our latest issue of Turkeyscope, Dr. Hay Eytan Cohen Yanarocak focuses on the recent May 2023 elections. He highlights the importance of sectarian identity as one factor underlying President Erdoğan's victory, which came despite the deteriorating economy, the earthquake disaster, and strong polling for his opponent.
Topic:: Sectarianism, Elections, Domestic Politics, Recep Tayyip Erdoğan, Earthquake, and Kemal Kılıçdaroğlu
Political Geography:: Turkey and Middle East

309. Can Turkish Jews Act as a Bridge in Israeli-Turkish Economic Relations?

Author:: Onur Yılmaz
Publication Date:: 03-2023
Content Type:: Working Paper
Institution:: Moshe Dayan Center for Middle Eastern and African Studies
Abstract:: This issue of Turkeyscope focuses on Israeli-Turkish economic relations. While highlighting the emerging challenges that may diminish Turkish Jews' traditional role, Onur Yilmaz of Izmir's Ege University analyzed the prospects of the economic relations by shedding a light on their contributions to the prosperity of both nations.
Topic:: Bilateral Relations, Minorities, Economy, and Jewish community
Political Geography:: Turkey, Middle East, and Israel

310. Deciphering Erdoğan's Regional Paradigm Shifts

Author:: Ofra Bengio
Publication Date:: 02-2023
Content Type:: Working Paper
Institution:: Moshe Dayan Center for Middle Eastern and African Studies
Abstract:: In our latest issue of Turkeyscope, Professor Ofra Bengio analyses the trajectory of Turkish foreign and domestic policies by examining three paradigms in Erdogan's strategy since the early 2000s. In addition, we offer our sincere condolences to the victims of the earthquake last week.
Topic:: Foreign Policy, Bilateral Relations, Weapons, Arab Spring, Recep Tayyip Erdoğan, Industry, and Russia-Ukraine War
Political Geography:: Russia, Turkey, and Middle East

311. The Druze Protest in the Summer of 2023

Author:: Omri Eilat
Publication Date:: 08-2023
Content Type:: Working Paper
Institution:: Moshe Dayan Center for Middle Eastern and African Studies
Abstract:: The current issue of Bayan contains an essay by Dr. Omri Eilat, which deals with the characteristics of the protest in the Druze communities in the north of the country that erupted following the Israeli government’s intention to establish a turbine farm in the Golan at the beginning of this summer. The essay analyzes the origins of the protest and its possible effects on the relationship between the Druze community and state authorities.
Topic:: Minorities, Protests, Wind Power, Druze, Energy, and Arabs
Political Geography:: Middle East, Israel, and Golan Heights

312. Without a state, within the State: Arab citizens in Israel and the judicial protests

Author:: Maysoun Ershead Shehadeh
Publication Date:: 04-2023
Content Type:: Working Paper
Institution:: Moshe Dayan Center for Middle Eastern and African Studies
Abstract:: The current issue of Bayan is being published amidst an emotional public and political controversy over the reform of the judicial system in the State of Israel, and deals with the Arab public’s position on the judicial reform. The article by Dr. Maysoun Ershead Shehadeh deals with the participation of Arab citizens in the public protest against the judicial reform.
Topic:: Minorities, Protests, Judiciary, and Arabs
Political Geography:: Middle East and Israel

313. The changes in the legal system and their effect on the regime and the Palestinian minority in Israel

Author:: Manal Totry Jubran
Publication Date:: 04-2023
Content Type:: Working Paper
Institution:: Moshe Dayan Center for Middle Eastern and African Studies
Abstract:: The current issue of Bayan is being published amidst an emotional public and political controversy over the reform of the judicial system in the State of Israel, and deals with the Arab public’s position on the judicial reform. The article by Dr. Manal Totry Jubran surveys the proposed changes to the Israeli judicial system and their effect on Arab citizens.
Topic:: Minorities, Reform, Domestic Politics, Protests, Judiciary, and Palestinians
Political Geography:: Middle East, Israel, and Palestine

314. Autonomy Curbed? Kurdish Oil Exports Hit Snags from Turkey and Baghdad

Author:: Joshua Krasna
Publication Date:: 07-2023
Content Type:: Working Paper
Institution:: Moshe Dayan Center for Middle Eastern and African Studies
Abstract:: In this new edition of Tel Aviv Notes, Josh Krasna examines the implications of the closure of the pipeline that delivered oil from the Kurdistan Regional Government of Iraq to Turkey's Ceyhan port, focusing on the state of relations between Erbil and Baghdad.
Topic:: Oil, Economy, Exports, and Autonomy
Political Geography:: Iraq, Turkey, Middle East, and Kurdistan Region of Iraq (KRI)

315. Tourism in the South Caucasus region during the post-pandemic period

Author:: Murad Agayev
Publication Date:: 01-2023
Content Type:: Working Paper
Institution:: Center for Economic and Social Development (CESD)
Abstract:: This article explores the tourism sector of the South Caucasus region in the post-pandemic period. In general, due to the pandemic, the share of the tourism sector in the global GDP has decreased by more than 2 times. In the post-pandemic period, although the share of the sector in the global GDP has increased again, it lags behind the statistics of the pre-pandemic period. Surrounded by the Black Sea from the west and the Caspian Sea from the east, the South Caucasus region has a unique nature, rich historical and cultural heritage, unique gastronomy, traditions and riches that transcend national borders.
Topic:: Tourism, GDP, and COVID-19
Political Geography:: Azerbaijan and South Caucasus

316. What are the Drivers of Child Marriage: A Case of Azerbaijan

Author:: Farid Rahimli
Publication Date:: 01-2023
Content Type:: Working Paper
Institution:: Center for Economic and Social Development (CESD)
Abstract:: This paper analyzes early marriages by gender group of regions of the Republic of Azerbaijan. Which factors cause early Marriages, and how early marriages lead to other problems. Districts in Azerbaijan have a higher rate of early marriages than cities. The Article considers the population distribution by sex, number and total ratios of officially registered marriages and divorces. 2005–2021 number of marriages by age groups of bride and groom, 2021, the number of marriages by age group of the bride and groom in the economic regions and administrative-territorial units Azerbaijan. This assessment identified more of the initial effects of early marriages and gender equality...
Topic:: Development, Children, Child Marriage, and Society
Political Geography:: Caucasus and Azerbaijan

317. Assessing the importance of new corridors in the South Caucasus in the context of the RussianUkrainian war

Author:: Murad Agayev
Publication Date:: 01-2023
Content Type:: Working Paper
Institution:: Center for Economic and Social Development (CESD)
Abstract:: This article analyzes the possibilities of a new corridor in the South Caucasus region in the context of the Russian-Ukrainian war. The research is important because after the 44-day war, fertile conditions for new opportunities have emerged in the South Caucasus region. The RussianUkrainian war and the resulting damage to the transport sector, like other sectors, necessitated the creation and use of alternative routes. The questioning of the security of the Black Sea due to the war and the closing of the European space for Russia created a problem for the countries that used Russia and the Black Sea to reach Europe. These countries are already evaluating alternative opportunities to the corridors. One of these possibilities is the Middle Corridor project, which has seen an increase in the volume of transported cargo since its inception, except during the pandemic period. During the war, the shortest possible transport corridor from China to Europe will be provided after the financial investment in the infrastructure and the integration of the Zangezur Corridor into the Middle Corridor, and work on this process is currently being continued. The North-South Corridor, which has been discussed for a long time however has not gained much popularity, gained even more importance during the war, and the works related to the construction of the infrastructure of the corridor were accelerated.
Topic:: Security, Infrastructure, Transportation, and Russia-Ukraine War
Political Geography:: Russia, Ukraine, Azerbaijan, and South Caucasus

318. Gender Equality & Women's Empowerment in the Post-Soviet Space: Challenges and Perspectives

Author:: Vugar Bayramov, Nigar Islamli, and Emin Mammadov
Publication Date:: 01-2023
Content Type:: Working Paper
Institution:: Center for Economic and Social Development (CESD)
Abstract:: The countries have a plan for women’s empowerment that sets it as a primary target in national development plan for achieving gender equality outcomes across the country. Under this review, the countries’ gender assessment, which mainly consider the female labor force participation in these countries, elaborates the extent to which women enjoy the same rights and opportunities, in which sectors they are highly employed and what obstacles they face that could be of exceptional importance in formulating policy objectives. The analysis also touches some points on women’s social and economic empowerment, which pertains to access opportunities and resources, and control their own lives.
Topic:: Development, Women, Employment, Inequality, Post-Soviet Space, and Gender
Political Geography:: Caucasus and Azerbaijan

319. Sex-selective Abortion in Azerbaijan: Exploring Institutional Dynamics and Responses

Author:: Fuad Karimli
Publication Date:: 01-2023
Content Type:: Working Paper
Institution:: Center for Economic and Social Development (CESD)
Abstract:: Azerbaijan has been gradually ranked lower in terms of its gender equality indicators like the political empowerment and estimated earned income of women (Gender Gap Report, 2022). Sex selective abortion has considerably risen in the past thirty years in and currently Azerbaijan holds the highest level globally. If the sex ratio at birth (SRB) is higher than the natural range, then there is sex-selective abortion taking place. A stratification is seen through the regions of Azerbaijan in terms of the SRB. Most of the regions with highest SRB are in southern regions. Half of the fourteen economic regions in Azerbaijan have seen a decrease in the SRB within the past ten years, three have seen an increase and four have not experienced a significant change. High levels of sex-selective abortion have impacted the demography of Azerbaijan, but it has not had long-term social and economic effects. The employment rate for women and the number of girls enrolled into education has increased throughout all regions. However, looking through a more general scope, over thirty years of sex-selective abortion has had an impact on the demographic distribution, to the extent that women make up less of the population under 30 years old on average than men. Although the number of women employed has seen a steady increase, the gender gap in the labour force has only marginally decreased in five years with more women than men in the working age population who are unemployed. The number of abortions after 12 weeks has also seen a faster increase as compared to the total number of abortions.
Topic:: Women, Discrimination, Empowerment, Abortion, and Gender
Political Geography:: Caucasus and Azerbaijan

320. Bridging the Gap: A "Sustainable Food Seal"

Author:: Paul E. III Schickler, Francesca Debiase, Sally Rockey, Jennifer Goldston, Peggy Tsai Yih, and Natalie Burdsall
Publication Date:: 05-2023
Content Type:: Working Paper
Institution:: Chicago Council on Global Affairs
Abstract:: Climate change is wrecking havoc on the global food supply chain, drawing attention to the benefits of sustainable practices for preserving the food system. As a result, consumers are starting to shift their purchasing behaviors, opting for more sustainable food options that might have a smaller carbon footprint or use fewer resources. To help inform their purchasing decisions, consumers are demanding more information on how and where their food is produced, but they are largely unable to find a labeling system with clear and comprehensive standards; existing "green" and "eco" labels are often private certification schemes that focus on only one aspect of sustainability. A "sustainable food seal" is a potential solution. A label that would standardize a food product’s eco-score to reduce consumer confusion, sustainable food seals take an inclusive approach to food labeling that use comparable metrics that involve all parts of the food value chain—from farm to fork—and offer the opportunity to validate practices and empower stakeholders to support a more sustainable food supply chain. Based on a November 2022 roundtable, the first in a series of regular convenings, the white paper “Bridging the Gap: A ‘Sustainable Food Seal’ Needed to Improve Transparency between Farmers and Consumers about Sustainable Food Production” explores current food labeling practices, identifies challenges to label standardization and voluntary adoption, and proposes potential actions and strategies to provide insight into the role a “sustainable food seal” can play in enhancing sustainability through food.
Topic:: Agriculture, Climate Change, Environment, Food, Food Security, Sustainability, Farming, and Supply Chains
Political Geography:: Global Focus

321. Global Terrorism Index 2023

Author:: Institute for Economics and Peace (IEP)
Publication Date:: 03-2023
Content Type:: Working Paper
Institution:: Institute for Economics & Peace (IEP)
Abstract:: The GTI report is produced by the Institute for Economics & Peace (IEP) using data from TerrorismTracker and other sources. TerrorismTracker provides event records on terrorist attacks since 1 January 2007. The dataset contains almost 66,000 terrorist incidents for the period 2007 to 2022. In 2022, deaths from terrorism fell by nine per cent to 6,701 deaths and is now 38 per cent lower than at its peak in 2015. The fall in deaths was mirrored by a reduction in the number of incidents, with attacks declining by almost 28 per cent from 5,463 in 2021 to 3,955 in 2022. However, if Afghanistan was removed from the index, terrorism deaths would have increased by four per cent. Afghanistan remained the country most impacted by terrorism for the fourth consecutive year, despite attacks and deaths falling by 75 per cent and 58 per cent respectively. The GTI does not include acts of state repression and violence by state actors and, as such, acts committed by the Taliban are no longer included in the scope of the report since they took control of the government.
Topic:: Climate Change, Economics, Science and Technology, Terrorism, Finance, and Peace
Political Geography:: Middle East, North Africa, and Global Focus

322. Tracking workers across generations – a cohort-based analysis

Author:: Rosa Abraham
Publication Date:: 09-2023
Content Type:: Working Paper
Institution:: Centre for Sustainable Employment, Azim Premji University
Abstract:: Alongside rapid economic growth, India also saw steady de-agrarianisation of its economy in terms of contribution to GDP. In terms of employment, however, the movement out of agriculture was slower, and when they did exit, it was often a withdrawal from the workforce entirely. In general, more of the workforce are in salaried employment, however, these have filtered differently by gender, caste and religion. While cross-sectional data gives us a sense of how these structural changes affect workers at any given point in time, it cannot tell us how these play out for workers over their lifetime as well as how different generations or cohorts of workers have been affected. Here, we use seven rounds of nationally representative official data to construct cohorts who are tracked over these periods to observe employment participation and the patterns over time. We find that younger generations of women systematically less likely to be in paid employment whereas for men, after a certain age, generations look similar in terms of employment rate. Similarly, when examined from the perspective of cohorts, we find that access to salaried employment has changed by gender and caste, and increase in earnings over time over their lifecycle has slowed for certain groups.
Topic:: Women, Employment, Economic Growth, and Economic Mobility
Political Geography:: South Asia and India

323. Association between Caste and Class in India: Evolution of Caste-Class Dynamics during Economic Growth

Author:: Vaishali Kohli
Publication Date:: 09-2023
Content Type:: Working Paper
Institution:: Centre for Sustainable Employment, Azim Premji University
Abstract:: Caste and class are two major markers of social and economic stratification in India. They play a crucial role in sustaining and strengthening the process of social exclusion. It has been often expected that the process of economic growth and modernization may weaken the congruence between caste and class structures and induce social and economic mobility, thereby bringing about a change in the socio-economic environment. In this paper, we focus on the celebrated period of high economic growth in India during the previous decade to study the evolution of caste-class dynamics, to analyze the pattern of association between caste and class positions, and to examine whether this association/congruence has weakened during this period. The analysis is based on four rounds of employment-unemployment surveys of the National Sample Survey Organization covering the period 1999-2012. We construct a matrix of caste and class positions of repeated cross-sections of individuals that shows whether different caste groups are over- or under-represented in different class positions and how these representations have changed over time. We then use a multinomial logistic regression framework to capture the role of caste in explaining the conditional probability of an individual to belong to a particular class position, after controlling for other critical explanatory variables. We further examine how the explanatory role of caste has changed over time. Additionally, we explore the role of education, a crucial channel for socioeconomic mobility, in explaining the class positions of individuals belonging to different caste groups over time. Finally, we examine the impact of high economic growth in determining the class position of an individual in general, as well as for different caste groups over time. The analysis shows that caste has continued to remain an important factor in explaining class locations of individuals during the period of high economic growth. Further, the caste-class associations have continued to persist across different categories of education over time. While there has been a partial weakening of certain associations during the period, particularly for the Other Backward Castes and in some parts of the rural sector, the overall picture is more of continuity than change, with further strengthening and reinforcement of caste-class congruence along several axes. This calls into question the 2 expectations about social mobility with economic growth as well as the nature of economic growth in India.
Topic:: Development, Economic Growth, Class, Caste, Social Exclusion, and Social Mobility
Political Geography:: South Asia and India

324. What did they say? Respondent identity, question framing and the measurement of employment

Author:: Rosa Abraham, Nishat Anjum, Rahul Lahoti, and Hema Swaminathan
Publication Date:: 09-2023
Content Type:: Working Paper
Institution:: Centre for Sustainable Employment, Azim Premji University
Abstract:: In developing countries, a precise approach to measuring women’s employment remains elusive. Emerging evidence underscores the pivotal role of survey methodology, encompassing respondent selection and question framing, in shaping the assessment of women’s employment. Drawing from two labor market experiments in rural India, this study offers insights on the influence of survey design on the measurement of women’s employment. The first experiment contrasts self-reported women’s and men’s employment figures with proxy-reported data from spouses. Women’s self-reported workforce participation surpasses proxy-reported estimates by six percentage points, while men’s estimates exhibit negligible differences. There are significant differences in the type of employment activities reported by self and proxy for both women and men. These divergences emanate from asymmetric measurement errors, stemming from gender-based norm disparities between spouses, and divergent interpretations of employment. Additionally, information asymmetry between spouses concerning women’s marginal activities and disparities in spousal characteristics contribute to these self-proxy differences. The second experiment investigates if framing of questions and recall period has an impact on reporting of labor market outcomes. We find that employing multiple questions to capture weekly employment status yields a 10-percentage-point increase in reported women’s workforce participation, but men’s participation rate decreases by six percentage points. Furthermore, when a distinct employment query is directed at each day of the preceding week as opposed to a single query for the entire week, reported women’s workforce participation increases by seven percentage points, and men’s by four percentage points.
Topic:: Development, Employment, Survey, Methods, and Gender
Political Geography:: South Asia and India

325. Jobless growth and structural transformation: Some theoretical considerations and empirical evidence from India

Author:: Zico Dasgupta and Amit Basole
Publication Date:: 09-2023
Content Type:: Working Paper
Institution:: Centre for Sustainable Employment, Azim Premji University
Abstract:: The decoupling of output growth and employment growth, known popularly as “jobless growth” has been a problem plaguing many countries. Using cross-country data, we show that India has underperformed significantly on job creation compared to the average developing country with lower than average employment elasticities at both the aggregate level and for the non-agricultural sector. Strikingly, we find a one-for-one relationship between output growth and productivity growth in India’s non-agricultural sector, i.e. a Kaldor-Verdoorn coefficient of one. Despite this joblessness of growth, the Indian economy has experienced some structural transformation with the share of the non-agricultural sector and the share of regular wage employment rising at the expense of agriculture and self-employment. We develop a theoretical model which clarifies the relative roles of labour demand and labour supply in determining the output-employment relationship. In this model, the Indian case of some structural transformation even with jobless growth emerges as one case among four possible cases (growth with or without jobs / structural change or no structural change). We conclude with some policy implications.
Topic:: Employment, Economic Growth, Gender, Structural Transformation, and Jobless Growth
Political Geography:: South Asia and India

326. Telephone surveys for data collection – some reflections

Author:: Rosa Abraham and Mridhula Mohan
Publication Date:: 09-2023
Content Type:: Working Paper
Institution:: Centre for Sustainable Employment, Azim Premji University
Abstract:: Phone-based surveys have emerged as important survey tool with their use increasing particularly during the pandemic-induced lockdowns. However, the use of phone-based surveys comes with concerns around sampling and reporting – the former refers to issues in terms of reaching the intended respondents and adequate representation of different groups while the latter relates to the quality of data collected. Based on a phone-survey of a pre-existing cross-section of households in Karnataka and Rajasthan conducted during the lockdowns of 2020, this paper looks at how sampling and reporting issues play out especially with regard to speaking to women. Access to women, via phone surveys, is limited since most women do not have their own phone, and even if they are reached, they may not have the freedom to respond to all questions asked. We recommend a detailed protocol with multiple callbacks and rescheduling of calls that reduce sampling errors and allow for greater reach of women respondents and minimise discretionary decisions from the enumerators . We also recommend a set of questions to enumerators to help reflect on the quality of data collected. While phone surveys cannot replace in-person surveys, in the event they are used, a well designed protocol along with the use of meta and para data can go a long way in enhancing the quality and reliabilty of the data.
Topic:: Women, Employment, Survey, Methods, and Data Collection
Political Geography:: South Asia and India

327. The Unhappy Marriage of Women’s Work and Spousal Violence in India

Author:: Vijayshree Jayaraman
Publication Date:: 09-2023
Content Type:: Working Paper
Institution:: Centre for Sustainable Employment, Azim Premji University
Abstract:: Gender-based violence against women is a public health crisis that highlights the persistent gender inequalities present in our society. Informed by theories in several disciplines, spousal violence can be modelled as a multi-faceted phenomenon arising from the intersection of many factors, that may either be a risk or buffer factors. This papers tries to understand if a women’s employment is a risk or buffer factor for spousal violence. We use the NFHS 4 data-set and develop linear probability models to understand the different channels through which employment may change the likelihood of violence. We find that, being employed makes a woman more vulnerable to spousal violence, particularly if the woman earns more than the husband. Adding to that, we find evidence suggesting ‘female guilt’ present in working wives, where they justify spousal violence especially if ‘the wife is unfaithful’. We argue the need to account for different form of violence while studying spousal violence, which has not been studied previously in the literature and present results for the same.
Topic:: Women, Employment, Gender Based Violence, Domestic Violence, and Bargaining
Political Geography:: South Asia and India

328. Estimating the productivity gap between organised and unorganised small-scale units in India’s manufacturing sector

Author:: Amit Basole, Dimple Chopde, and Paaritosh Nath
Publication Date:: 06-2023
Content Type:: Working Paper
Institution:: Centre for Sustainable Employment, Azim Premji University
Abstract:: Small manufacturing firms are considered to be engines of growth and job creation. While most research on small firms focuses on formal sector units, in India informal sector units far outnumber the formal. This is true even for manufacturing units employing 5 to 49 workers, which constitute only 5% of all unorganised units, but in absolute numbers are nine times more numerous than organised units in the same size class. Such firms have the potential to contribute to structural transformation but their capacities vis-a-vis formal firms are not well understood. To address this, we create a unit-level dataset combining Annual Survey of Industries data for organised (formal) units with the National Sample Survey data on unorganised (informal) units. We also discuss problems involved in this exercise and some ways to deal with them. We find that matching organised and unorganised units on observable characteristics reduces the labour productivity differences between them to around 25 percent. We discuss some policy implications of our results.
Topic:: Employment, Manufacturing, Productivity, and Informal Economy
Political Geography:: South Asia and India

329. Labour Market Flows and Gender Differentials in Urban Unemployment Over the Pandemic

Author:: Paaritosh Nath
Publication Date:: 05-2023
Content Type:: Working Paper
Institution:: Centre for Sustainable Employment, Azim Premji University
Abstract:: Utilising data from the Periodic Labour Force Survey, we estimate quarterly changes in urban labour market flows over the period 2018 to 2022 and the impact on unemployment rates for men and women. Our analysis provides non-intuitive explanations for established findings as well as pointing out important questions for further study. Both men and women’s unemployment rates have reduced in 2022 compared to 2018, showing rapid reductions following the high levels reached during the lockdown. Women’s unemployment rates have consistently been higher than men throughout this period. The gap between men and women’s unemployment rates reduced during the lockdown, but have shown signs of increasing since 2021, even as unemployment rates have fallen. For women, flows from the labour force to non-participation play a larger role in explaining changes in unemployment rates as compared to men. Flows from the labour force to non-participation, however, have reduced since the pandemic, providing an explanation as to why labour force participation rates have increased, namely, women staying for longer in the labour force rather than more women entering it. Despite rising labour force participation rates, the gender gap in unemployment rates have risen, in contrast to developed economies.
Topic:: Urban, Unemployment, COVID-19, Labor Market, and Gender
Political Geography:: South Asia, India, and Global Focus

330. Prescription for Military Paralysis: Wartime Reactor Meltdowns (Occasional Paper 2305)

Author:: Henry Sokolski
Publication Date:: 06-2023
Content Type:: Working Paper
Institution:: Nonproliferation Policy Education Center
Abstract:: More than 15 months into the war, Russian attacks against Ukraine’s nuclear plants have yet to release any radiation. As the likelihood of the Zaporizhzhia nuclear plant reopening quickly declines and Putin’s desire to distract the world from his declining political and military standing increases, some experts fear he may want to induce a radiological release from the plant. In any case, Putin’s military assaults against the Zaporizhzhia plant have already set a worrying precedent. Last December, NPEC held a wargame, the results of which The Bulletin of Atomic Scientists just published, to examine what might happen in a future Russian invasion of Ukraine. In this reinvasion in 2037, Russia targets power reactors in Ukraine, Poland, and Romania. The United States plans to build scores of new reactors in these countries. What if Russian missiles targeted them in a future war? NPEC tapped the expertise of Ukrainians, Romanians, NATO officials, Poles, US security experts, and Hill staff to find out. It hosted five sessions over two weeks and ran a three-move wargame. The game’s play revealed how the uncertainties and dangers of military attacks against nuclear power plants can paralyze decision-making and fundamentally alter the course of wars. The military disruptions these uncertainties introduce may far outstrip the safety issues any reactor radiological release might otherwise present. The game’s play revealed three reasons why.
Topic:: Security, NATO, Military Affairs, Nonproliferation, War Games, Nuclear Energy, and Russia-Ukraine War
Political Geography:: Russia, Europe, and Ukraine

331. FACTORING THE SMART POWER IN THE INDIA-EUROPEAN UNION ENGAGEMENTS: A SCOPING REVIEW

Author:: Nippun Gupta, Bawa Singh, Aslam Khan, and Jaspal Kaur
Publication Date:: 03-2023
Content Type:: Working Paper
Institution:: Institute for Research and European Studies (IRES)
Abstract:: Power is a critical factor in several types of diplomacy. India-EU relations are a classic case of how changing geopolitics prompted diplomatic acumen. This scoping review assesses the changing relations of both partners as a manifestation of Smart Power. The dynamic relations from normative-based to pragmatic and inclusive interests based are evaluated. Their value-based relations are put under international relations theories. Their changing factors of cooperation are used to justify their smart diplomacy, where contemporary relations are less likely to be affected by multilateral interests. To solidify claims of smart power in their relations, the recent TRIPS waiver schism illuminated health diplomacy between the two regions. This health diplomacy discourse promotes smart power diplomacy between India and the EU, where new avenues of cooperation emerge despite pandemic disagreements. The article explores how hybrid power is better than soft and hard power in silos by systematically searching and selecting the existing knowledge in the contemporary context.
Topic:: Diplomacy, Health, Bilateral Relations, European Union, Soft Power, Hard Power, and Smart Power
Political Geography:: Europe, South Asia, and India

332. An Overview of the African Peacebuilding Network’s (APN’s) Contribution to African Peacebuilding Literature

Author:: Godwin Onuoha
Publication Date:: 05-2023
Content Type:: Working Paper
Institution:: Social Science Research Council
Abstract:: This working paper surveys, documents, and analyzes the contributions of APN scholars to the knowledge and practice of peacebuilding in Africa against the background of the 10th year anniversary of the APN program. It takes stock of the contributions and impact of the literature produced by APN scholars, particularly how these have brought different interdisciplinary perspectives and novel methodological approaches to bear on African peacebuilding. The paper systematically analyzes African perspectives on peacebuilding, debates between different schools of thought, provides an overview of different publications by APN scholars, and synthesizes the significance of these contributions to discourses on African and global literature on peacebuilding. As part of a broader intellectual project, the publications demonstrate how APN scholars have forged a nexus at which one can explore conflict, peacebuilding, media, gender, youth, boundaries and borderlands, land grabs, migration and refugees, faith-based initiatives, local/ communal cultures, identities, and COVID-19, among other topics. The publications under review transcend the narrow confines of the literature to engage in the complexities and multidimensional nature and contexts of African peacebuilding. In this regard, the publications mainstream African agency and views, particularly in the production of African knowledge in the field of peacebuilding.
Topic:: Conflict, Literature, Peacebuilding, and Transdisciplinarity
Political Geography:: Africa

333. Striking evidence: The impact of railway strikes on competition from intercity bus services in Germany

Author:: Matthias Beestermöller, Levke Jessen-Thiesen, and Alexander Sandkamp
Publication Date:: 06-2023
Content Type:: Working Paper
Institution:: Kiel Institute for the World Economy (IfW)
Abstract:: This paper investigates the impact of the largest rail strikes in German history on intercity buses – a then newly liberalised market. Using unique booking data of bus services, we exploit variation in rail service cancellations across routes to show that the disruption in rail transport increases bus ticket sales. Crucially, the effect persists beyond the strike, indicating that travellers do not return to their originally preferred mode of transport. It is particularly pronounced for passengers travelling on weekends. The findings suggest that customers were previously under-experimenting. Beyond transportation, our results highlight the importance of service reliability, as temporary disruptions can cause customers to permanently switch to competitors.
Topic:: Labor Issues, Business, Transportation, and Labor Strike
Political Geography:: Europe and Germany

334. Carbon Capture and Storage - Publics in five countries around the North Sea prefer to do it on their own territory

Author:: Christine Merk, Gisle Andersen, Åsta Dyrnes Nordø, and Torben Helfrich
Publication Date:: 07-2023
Content Type:: Working Paper
Institution:: Kiel Institute for the World Economy (IfW)
Abstract:: Carbon Capture and Storage (CCS) has been identified as an essential part of the lowest-cost path toward reaching the goals of the Paris Agreement. In Europe, an accelerated pace of CCS development indicates that a CO2 transport and storage system could be established by 2030. However, we know little about how the public views the market for transport and storage of CO2 currently under development in Europe. In early 2023, we conducted an experimental comparative survey to study public opinions on cross-border CO2 trade for storage in Denmark, Germany, the Netherlands, Norway and the UK. The share of respondents that perceive CCS as somewhat positive or very positive varies considerably between the countries; we find the highest share in Denmark (69%), followed by the UK (68%), Norway (67%), the Netherlands (57%) and the lowest share in Germany (49%). Especially concerns about environmental risks and costs lead to more negative views, while perceptions of job creation and economic opportunities lead to more positive evaluations. The experimental results show that importing CO2 for storage is among the least preferred options in all countries, while the storage of CO2 that has been captured in the own country is the most preferred option; the gap in the share of positive evaluations is substantial and amounts to up to 20 percentage points in the UK. Respondents who feel that countries are responsible for reducing national greenhouse gas emissions and storing their own captured CO2 drive the pattern of a more positive evaluation of a domestic CCS value chain and a more negative evaluation of importing CO2.
Topic:: Climate Change, Trade, Carbon Emissions, and Perception
Political Geography:: Europe and North Sea

335. Spatial Wage Inequality in North America and Western Europe: Changes Between and Within Local Labour Markets 1975-2019

Author:: L. Baluz, P. Bukowski, M. Fransham, A. Lee, and M. López Forero
Publication Date:: 08-2023
Content Type:: Working Paper
Institution:: Kiel Institute for the World Economy (IfW)
Abstract:: The rise of economic inequalities in advanced economies has been often linked with the growth of spatial inequalities within countries, yet there is limited comparative research that studies the relationship between national and subnational economic inequality. This paper presents the first systematic attempt to create internationally comparable evidence showing how different countries perform in terms of geographic wage inequalities. We create cross-country comparable measures of spatial wage disparities between and within similarly-defined local labour market areas (LLMAs) for Canada, France, (West) Germany, the UK and the US since the 1970s, and assess their contribution to national inequality. By the end of the 2010s, spatial inequalities in LLMA mean wages are similar in Canada, France, Germany and the UK; the US exhibits the highest degree of spatial inequality. Over the study period, spatial inequalities have nearly doubled in all countries, except for France where spatial inequalities have fallen back to 1970s levels. Due to a concomitant increase in within-place inequality, the contribution of places in explaining national wage inequality has remained fairly constant over the 40-year study period, except in the UK where we document a significant increase. Whilst common global social, economic and technological shocks are important drivers of spatial inequality, this variation in levels and trends of spatial inequality opens the way to comparative research exploring the role of national institutions in mediating how global shocks translate into economic disparities between places.
Topic:: Inequality, Labor Market, and Wages
Political Geography:: Europe and North America

336. It’s not a Sprint, it’s a Marathon: Reviewing Governmental R&D Support for Environmental Innovation

Author:: Leonie Meißner, Sonja Peterson, and Finn Ole Semrau
Publication Date:: 08-2023
Content Type:: Working Paper
Institution:: Kiel Institute for the World Economy (IfW)
Abstract:: In a race against excessive global warming, the world must accelerate the development and adoption of environmental innovations (EIs). EIs are crucial in decarbonizing the economy and meeting the net-zero targets. In this literature review, we delve into the role of governments in promoting EIs across stages of maturity and the likeliness of such support to reduce emissions and mitigation costs. Various theoretical justifications, such as knowledge externalities, dynamic increasing returns, path dependency and incomplete information, highlight the necessity to promote EI through governmental Research and Development (R&D) support. While emission pricing remains the most cost-efficient climate policy, it fails as a stand-alone instrument to sufficiently encourage EI. Accordingly, the optimal approach is a policy mix complementing emission pricing with governmental R&D support. The theoretical finding is backed by empirical studies on the development and deployment of renewable energies, which also show that investment in R&D can effectively reduce emissions and mitigation costs. By combining theoretical and empirical research, the review concludes by examining two pivotal policy actions aimed at accelerating the take-off of EIs: The US Inflation Reduction Act and the European Green New Deal Industrial Plan. We evaluate their specific aspects and limitations to effectively and efficiently contribute to decarbonization.
Topic:: Climate Change, Environment, Innovation, and Research and Development
Political Geography:: Global Focus

337. The Labor Market Effects of Disability Benefit Loss

Author:: Anikó Bíró, Cecília Hornok, Judit Krekó, Dániel Prinz, and Ágota Scharle
Publication Date:: 09-2023
Content Type:: Working Paper
Institution:: Kiel Institute for the World Economy (IfW)
Abstract:: Disability benefits are costly and tend to reduce labor supply. While spending can be contained by careful targeting, correcting past flaws in eligibility rules or assessment procedures may entail welfare costs. We study a major reform in Hungary that reassessed the health and working capacity of a large share of beneficiaries. Leveraging age and health cutoffs in the reassessment, we estimate employment responses to loss or reduction of benefits. We find that among those who left disability insurance due to the reform 58% were employed in the primary labor market, 6% participated in public works and 36% were out of work without benefits in the post-reform period. The consequences of leaving disability insurance sharply differed by pre-reform employment status. 81% of beneficiaries who had some employment in the pre-reform year worked, while only 33% of those without pre-reform employment did. The gains of the reform in activating beneficiaries were small and strongly driven by pre-reform employment status. This points to the importance of combining financial incentives with broader labor market programs that increase employability.
Topic:: Health, Employment, Economy, Disability, Fiscal Policy, Insurance, Labor Market, and Welfare State
Political Geography:: Europe and Hungary

338. Time to say goodbye? The impact of environmental regulation on foreign divestment

Author:: Haiou Mao, Holger Görg, and Guopei Fang
Publication Date:: 09-2023
Content Type:: Working Paper
Institution:: Kiel Institute for the World Economy (IfW)
Abstract:: We look at divestments by foreign firms – a topic that has received comparatively little attention in the literature – and investigate how changes in the regulatory environment in the host country may impact on such divestment decisions. We use the implementation of China’s Two Control Zone (TCZ) policy as a “quasi-natural experiment”, using detailed firm level combined with city level data for the empirical analysis. Our results show that the implementation of TCZ policy has led to higher probabilities of divestments by foreign firms in targeted TCZ cities and industries. The mechanism behind this seems to be a TCZ-induced increase in discharge fees and efforts to reduce SO2 emissions. Allowing for heterogeneity of effects, we find that the effect is particularly strong for firms from source countries with less stringent environmental regulation, and those using less advanced technology. We furthermore show that firms using intermediates from polluting industries also experience a higher probability of divestment.
Topic:: Climate Change, Environment, Foreign Direct Investment, Regulation, Business, and Divestment
Political Geography:: China and Asia

339. Regional Development and Internal Migration Aspects of Structural Transformation: A Case Study of Senegal

Author:: Askar Mukashov
Publication Date:: 10-2023
Content Type:: Working Paper
Institution:: Kiel Institute for the World Economy (IfW)
Abstract:: This study investigates regional development and internal migration dynamics within the context of modern structural transformation in Sub-Saharan Africa. We develop a regionalized Computable General Equilibrium model that incorporates regionalized production, endogenous interregional migration, and distinct migrant households. Using this model, we simulate the structural transformation of Senegal as a case study. Our findings demonstrate that agricultural stagnation, exacerbated by global climate change, underlies the economic underperformance of rural regions and amplifies regional income disparities. Furthermore, our analysis shows that outmigration from stagnating rural provinces to a more developed capital region positively influences overall economic growth and mitigates regional income inequality. Nevertheless, these effects are limited, and a proactive approach to addressing income inequality across the nation's regions would require supporting agriculture, as it represents a more equitable policy than promoting nonagricultural sectors in both rural and capital regions.
Topic:: Climate Change, Migration, Economic Growth, Labor Market, and Regional Development
Political Geography:: Africa

340. Export impact on dividend policy for big Colombian exporting firms, 2006–2014

Author:: Federico Merchan
Publication Date:: 03-2023
Content Type:: Working Paper
Institution:: Kiel Institute for the World Economy (IfW)
Abstract:: This paper studies the impact of exogenous export demand shocks on firms’ dividend policy using firm specific real exchange rate variation as instrumental variable. IV exclusion restriction is plausibly satisfied because real exchange rate shocks were unanticipated -partly explained because of international oil price fluctuation-, and first stage results confirm relevance condition fulfillment. The results indicate that big private Colombian exporting firms decree dividends as a way to mitigate the agency cost generated by exogeneous exports variation via higher free cash flow and cash flow volatility, especially in poor managerial quality firms. Evidence supports agency cost theory and denies signaling.
Topic:: Development, Emerging Markets, Globalization, International Trade and Finance, and Exports
Political Geography:: Global Focus

341. China as an International Lender of Last Resort

Author:: Sebastian Horn, Bradley C. Parks, Carmen M. Reinhart, and Christoph Trebesch
Publication Date:: 03-2023
Content Type:: Working Paper
Institution:: Kiel Institute for the World Economy (IfW)
Abstract:: This paper shows that China has launched a new global system for cross-border rescue lending to countries in debt distress. We build the first comprehensive dataset on China’s overseas bailouts between 2000 and 2021 and provide new insights into China’s growing role in the global financial system. A key finding is that the global swap line network put in place by the People’s Bank of China is increasingly used as a financial rescue mechanism, with more than USD 170 billion in liquidity support extended to crisis countries, including repeated rollovers of swaps coming due. The swaps bolster gross reserves and are mostly drawn by distressed countries with low liquidity ratios. In addition, we show that Chinese state-owned banks and enterprises have given out an additional USD 70 billion in rescue loans for balance of payments support. Taken together, China’s overseas bailouts correspond to more than 20 percent of total IMF lending over the past decade and bailout amounts are growing fast. However, China’s rescue loans differ from those of established international lenders of last resort in that they (i) are opaque, (ii) carry relatively high interest rates, and (iii) are almost exclusively targeted to debtors of China's Belt and Road Initiative. These findings have implications for the international financial and monetary architecture, which is becoming more multipolar, less institutionalized, and less transparent.
Topic:: Debt, Emerging Markets, International Trade and Finance, Financial Crisis, Belt and Road Initiative (BRI), and Sovereign Debt
Political Geography:: Africa, China, and Asia

342. To Russia with Love? The Impact of Sanctions on Regime Support

Author:: Robert Gold, Julian Hinz, and Michele Valsecchi
Publication Date:: 03-2023
Content Type:: Working Paper
Institution:: Kiel Institute for the World Economy (IfW)
Abstract:: Do economic sanctions affect internal support of sanctioned countries’ governments? To answer this question, we focus on the sanctions imposed on Russia in 2014 and identify their effect on voting behavior in both presidential and parliamentary elections. On the economic side, the sanctions significantly hurt Russia’s foreign trade — with regional-level variation. We use trade losses caused by the sanctions as measure for regional sanction exposure. For identification, we rely on a structural gravity model that allows us to compare observed trade flows to counterfactual flows in the absence of sanctions. Difference-in-differences estimations reveal that regime support significantly increases in response to the sanctions, at the expense of voting support of Communist parties. For the average Russian district, sanction exposure increases the vote share gained by president Putin and his party by 13 percent. Event studies and placebo estimations confirm the validity of our results.
Topic:: Globalization, International Trade and Finance, Sanctions, Economy, and Russia-Ukraine War
Political Geography:: Russia and Eurasia

343. Exchange Rate Pass-Around

Author:: Matthieu Crozet, Julian Hinz, and Federico Trionfetti
Publication Date:: 04-2023
Content Type:: Working Paper
Institution:: Kiel Institute for the World Economy (IfW)
Abstract:: In January 2015, The Swiss Franc (CHF) appreciated unexpectedly against the Euro by approximately 15%. We document a new fact: French firms that exported to both the Swiss market and the Eurozone also exhibited a sudden change in their export prices to the Eurozone. We coin this the “exchange rate pass-around” effect. We rationalise this fact with a simple model based on the endogenous decision of some firms to give up pricing-to-market and opt for single-pricing to all markets. An important implication of this finding is that single-pricing may be one of the causes of the incomplete pass-through. This mechanism has so far remained unexplored in the literature, which may have led to overestimating the importance of other factors. Based on monthly French export data, our empirical analysis confirms the existence of the pass-around. Firms directly affected by the CHF exchange rate shock increased their prices in neighboring markets by 0.8% compared to other exporters. The effect was stronger for firms with lower ex-ante price heterogeneity across markets and for firms with smaller trade costs to Switzerland. However, the effect was short-lived. As time passed, exporters tended to decouple the prices they set on the Swiss market from those for the Eurozone, and the pass-around effect faded.
Topic:: International Trade and Finance, Markets, Monetary Policy, European Union, and Exchange Rate Policy
Political Geography:: Europe

344. Blowback: The Effect of Sanctions on Democratic Elections

Author:: Matthieu Crozet and Julian Hinz
Publication Date:: 04-2023
Content Type:: Working Paper
Institution:: Kiel Institute for the World Economy (IfW)
Abstract:: Sanctions are meant to coerce political adversaries through economic measures. However, evidence for their effectiveness is scarce. In this paper we assess the impact of sanctions on a democracy — France — by studying the electoral consequences of the sanctions and countersanctions imposed between Russia and Western countries. Contrary to most of the existing literature we find clear evidence for exposure to the sanctions to cause an increase in the vote share for pro-Russian (and far-right) candidates during the French 2017 presidential election. Locally, the impact on voting is substantial. Back-of-the-envelope calculations indicate that about 16,300 votes for the main far-right candidate can be directly attributed to the sanctions’ impact. This is the total number of votes cast in a medium-sized French city. It is however not nearly enough to have affected the outcome of the election at the national level.
Topic:: Globalization, International Trade and Finance, Sanctions, and Elections
Political Geography:: Russia, Europe, and France

345. Who is to suffer? Quantifying the impact of sanctions on German firms

Author:: Holger Görg, Anna Jacobs, and Saskia Meuchelbock
Publication Date:: 05-2023
Content Type:: Working Paper
Institution:: Kiel Institute for the World Economy (IfW)
Abstract:: In this paper, we use a novel firm level dataset for Germany to investigate the effect of sanctions on export behaviour and performance of German firms. More specifically, we study the sanctions imposed by the EU against Russia in 2014 in response to the annexation of Crimea and Russia's countermeasures. We find a substantial negative effect on both the extensive and intensive margin of German exports. While the negative effects are strongest for firms exporting products subject to trade restrictions, we provide further evidence on the indirect effects of sanctions. Analysing the impact on broader measures of firm performance, we document that the cost of sanctions is heterogeneous across firms but overall modest. Our results reveal that the negative impact of the shock was concentrated primarily among a small number of firms that were highly dependent on Russia as an export market and those directly affected by the sanctions.
Topic:: Foreign Policy, Globalization, International Trade and Finance, Sanctions, Russia-Ukraine War, and Firm Dynamics
Political Geography:: Russia, Europe, and Germany

346. Potential efficiency gains from the introduction of an emissions trading system for the buildings and road transport sectors in the European Union

Author:: Wilfried Rickels, Christian Rischer, Felix Schenuit, and Sonja Peterson
Publication Date:: 05-2023
Content Type:: Working Paper
Institution:: Kiel Institute for the World Economy (IfW)
Abstract:: In the European Union (EU), a second emissions trading system (EU ETS2) covering buildings, road transport and small energy and industrial installations is expected to be introduced from 2027. Until 2030, however, EU ETS2 will not be a separate pillar of EU climate policy, but will support Member States in meeting their national targets under the Effort Sharing Regulation (ESR). If there are net regional shifts in emission reductions within the EU ETS2, for example, if companies in one member state buy in aggregated terms net allowances, this must be compensated for at the national level. We study the EU ETS2 for the year 2030 using the general equilibrium model DART. In our analysis, the introduction of an EU ETS2 generates about a quarter of the efficiency gains of a comprehensive emissions trading system, assuming that nation states use the flexibility mechanisms of the ESR and compensate for regional abatement leakage through interstate emissions trading. However, this is only true if there is no extensive price stabilization in the EU ETS2. Our analysis suggests an EU ETS2 allowance price of around EUR 300/tCO2. Stabilizing the EU ETS2 price at the envisaged intervention price of 45 EUR/tCO2 would require about 415 million additional allowances and thus imply additional emissions of the same amount in 2030 alone.
Topic:: Climate Change, European Union, Economy, and Carbon Emissions
Political Geography:: Europe

347. Is the supermultiplier nil? - A Replication Study of Deleidi and Mazzucato (2021)

Author:: Jens Boysen-Hogrefe
Publication Date:: 05-2023
Content Type:: Working Paper
Institution:: Kiel Institute for the World Economy (IfW)
Abstract:: Analyzing US macro data via a structural vector-autoregressive model, Deleidi and Mazzucato (2021) find strong positive spillover of mission-oriented government spending on private research and development activity and on overall economic dynamism ("crowding in"). However the result hinges on specific transformation of the data. Deleidi and Mazzucato deflate all variables in their model via the GDP deflator. Applying originally price adjusted data a spillover on GDP cannot be found. Estimating the model with data starting in 1984, the results point at “crowding out” of private research and development activity.
Topic:: Economics, Fiscal Policy, Innovation, and Fiscal Multipliers
Political Geography:: North America and United States of America

348. The path of economics research production: Insights into the seesaw between theory and empirics

Author:: João Ricardo Faria, Rajeev K. Goel, and Neela D. Manage
Publication Date:: 01-2023
Content Type:: Working Paper
Institution:: Kiel Institute for the World Economy (IfW)
Abstract:: This paper provides insights into the apparent seesaw between the generation of theoretical versus empirical economics research over time. A dynamic model considers the incentives of researchers to focus on empirical versus theoretical papers. It yields the main characteristics of the path-changing of economics research, from theoretical-intensive to empirical-focused. The model has two equilibria, one with a higher proportion of theoretical papers and another with a higher proportion of empirical papers. Curiously, the equilibrium with greater theoretical papers is stable, while the one with more empirical papers is a saddle point. This suggests that the current trend of increasing empirical research is unlikely to last.
Topic:: Economics, Research, and Innovation
Political Geography:: Europe, North America, and United States of America

349. Technology will save the climate! Attitudes towards Norway’s climate policy in four social groups

Author:: Åsta Dyrnes Nordø
Publication Date:: 02-2023
Content Type:: Working Paper
Institution:: Kiel Institute for the World Economy (IfW)
Abstract:: The risk of opposition from the population increasingly plays a role in choosing the climate policy measures to achieve the objective to substantially reduce greenhouse gas emissions. In Norway, there is a long-standing cross-party consensus that the development of new technologies will be crucial for solving climate challenges. Comparing public opinion surveys, Norwegians are significantly more convinced that new technology will solve problems induced by climate change, compared people in other European countries. A concrete example of such a technology is carbon capture and storage (CCS). Despite discussions about the costs of establishing the technology, there is a cross-party consensus in Norway that CCS is a good and suitable measure for reaching climate policy goals. In this article, we review the historical background that has led to this broad support in Nor-way. Furthermore, we look at how this has been expressed in the political parties’ attitudes towards CCS. There has been a long standing consensus among all major parties that CCS should be developed and deployed. We argue that this lay the foundation for the societal support for CCS. We analyze data from the Norwegian Coordinated Online panels for research on DEMocracy and governance (KODEM) to examine the attitudes toward CCS among citizens and three functional elites, namely elected representatives, bureaucrats, and journalists. We find that CCS receives strong support in all four groups, but that citizens and elected representative are more skeptical compared to bureaucrats and journalists. However, when looking at the factors that influence the perception of CCS, the pattern is the same for all four groups. The more technology optimistic a person is, the more positively they tend to perceive CCS as a method to fight climate change. We also find that those who think the political efforts to reduce greenhouse gases are too great are less positive about CCS com-pared to those who think the efforts are appropriate or too small. Overall, the analysis indicates that all four societal groups are technology optimistic and characterized by the same attitudes toward climate change. We discuss the role of technology optimism in Norway’s climate policy and the reasons for the high degree of political consensus across groups with different societal functions.
Topic:: Climate Change, Science and Technology, Carbon Emissions, Elites, and Attitudes
Political Geography:: Europe and Norway

350. The Ukraine Support Tracker: Which countries help Ukraine and how?

Author:: Christoph Trebesch, Ariana Antezza, Katelyn Bushnell, Andre Frank, and Pascal Frank
Publication Date:: 02-2023
Content Type:: Working Paper
Institution:: Kiel Institute for the World Economy (IfW)
Abstract:: This paper presents the Ukraine Support Tracker, which lists and quantifies military, financial and humanitarian aid to Ukraine in the context of the Russia-Ukraine war. Since the third update we track support by 41 countries, specifically the EU member states, other members of the G7, as well as Australia, South Korea, Turkey, Norway, New Zealand, Switzerland, China, Taiwan, India and Iceland. The database is intended to support a facts-based discussion about support by other countries to Ukraine. Private donations and aid through non-governmental organizations are not included due to a lack of systematic data. To value in-kind support like military equipment or weapons, we rely on government statements as well as own calculations using market prices. We find significant differences in the scale of support across countries, both in absolute terms and as percent of donor country GDP.
Topic:: Economics, War, Foreign Aid, Military Aid, Geoeconomics, and Russia-Ukraine War
Political Geography:: Russia, Europe, Ukraine, Germany, and United States of America

351. Patterns of Global and Regional Value Chain Participation in the EAC

Author:: Sebastian Krantz
Publication Date:: 02-2023
Content Type:: Working Paper
Institution:: Kiel Institute for the World Economy (IfW)
Abstract:: Using global Multi-Region Input-Output (MRIO) data from 2005-2015, this paper empirically investigates the extent and patterns by which East African Community (EAC) countries have integrated into Global Value Chains (GVCs) and Regional Value Chains (RVCs). Results imply that the foreign content of exports (I2E) and the share of exports being re-exported (E2R) are stably between 10% and 20% in most EAC countries. Trade in intermediates with the rest of the world remains 12-14 times greater in value-added (VA) terms than the trade in intermediates inside the EAC. During 2005-2015, Kenya expanded its role as a regional supplier of manufactured inputs (higher E2R with EAC partners), and Uganda slightly increased its agricultural input to the Kenyan and Rwandan food processing sectors. Overall, however, a downstream shift is evident, by which more VA (both domestic and foreign) is used for the production of final goods while maintaining high levels of exports in primary agriculture and mining. This shift goes alongside a loss of comparative advantage in manufacturing in all EAC countries apart from Kenya. Econometric analysis suggests that higher I2E and E2R shares increase GDP with an average elasticity of ≥ 0.25 over 2 years. Estimates for manufacturing sectors were slightly higher at elasticities ≥ 0.3 in response to E2R shifts. These results imply that policy measures to increase manufacturing competitiveness and promote more horizontal RVCs would benefit EAC economic growth in the medium run.
Topic:: Globalization, Regional Integration, and Global Value Chains
Political Geography:: Africa

352. Exposure to War and Its Labor Market Consequences over the Life Cycle

Author:: Sebastian T. Braun and Jan Stuhler
Publication Date:: 02-2023
Content Type:: Working Paper
Institution:: Kiel Institute for the World Economy (IfW)
Abstract:: With 70 million dead, World War II remains the most devastating conflict in history. Of the survivors, millions were displaced, returned maimed from the battlefield, or spent years in captivity. We examine the impact of such wartime experiences on labor market careers and show that they often become apparent only at certain life stages. While war injuries reduced employment in old age, former prisoners of war postponed their retirement. Many displaced workers, particularly women, never returned to employment. These responses are in line with standard life‐cycle theory and thus likely extend to other conflicts.
Topic:: History, Displacement, World War II, Welfare, Prisoners of War, and Labor Market
Political Geography:: Europe and Germany

353. Africa’s Businesswomen – Underfunded or Underperforming?

Author:: Charles Ackah, Holger Görg, Aoife Hanley, and Cecília Hornok
Publication Date:: 03-2023
Content Type:: Working Paper
Institution:: Kiel Institute for the World Economy (IfW)
Abstract:: While the recent success of Africa’s ‘Lionesses’ – successful female entrepreneurs - is internationally celebrated, less is known about how liquidity can fuel the success of the ‘Lionesses’ and other businesswomen. Using information from a panel of over 800 male- and female-owned businesses in Ghana (ISSER-IGC survey), we capture a measure of underfunding, in addition to data on supplier credit, equity and other finance sources. Our regressions reveal a female-to-male productivity gap of between -11 to -19 percent, values similar to estimates for other African countries. However, when the relationship between gender and productivity is mediated by financial constraints, the gender performance gap disappears. Accordingly, female business-owners who indicate that funding is not a problem, are associated with higher productivity than males, all things equal. In a finding new to the literature, our regressions reveal the importance of supplier credit for Africa’s businesswomen.
Topic:: Globalization, International Trade and Finance, Women, Business, Productivity, and Liquidity
Political Geography:: Africa and Ghana

354. The Many Facets of EEZ Fisheries Disputes and their Resolution under UNCLOS

Author:: Natalie Klein
Publication Date:: 08-2023
Content Type:: Working Paper
Institution:: The Goettingen Journal of International Law
Abstract:: The core question being posed for this symposium was whether the ‘exception swallows the rule’ in relation to disputes concerning fishing in the exclusive economic zone (EEZ). This question emerges because of the starting point that disputes relating to the interpretation or application of the UN Convention on the Law of the Sea (UNCLOS)1 may be subject to compulsory procedures entailing binding decisions – arbitration or adjudication – at the request of a party to the Convention. However, while this ‘rule’ is the start, it is immediately important to point our that there are exceptions and limitations to this proposition; the grant of compulsory jurisdiction in UNCLOS is limited in significant ways.2 The ‘exception’ of concern to this symposium is set out in Article 297(3) of UNCLOS, which excludes fisheries disputes from adjudication or arbitration in the following situation: “the coastal State shall not be obliged to accept the submission to such settlement of any dispute relating to its sovereign rights with respect to the living resources in the exclusive economic zone or their exercise, including its discretionary powers for determining the allowable catch, its harvesting capacity, the allocation of surpluses to other States and the terms and conditions established in its conservation and management laws and regulations.“3 Pursuant to Article 298(1)(b), States also have the option to exclude ‘disputes concerning law enforcement activities in regard to the exercise of sovereign rights or jurisdiction excluded from the jurisdiction of a court or tribunal’ under Article 297(3).4 The symposium papers that follow seek to improve our understanding of these exceptions to compulsory jurisdiction; do they swallow the ‘rule’ of compulsory jurisdiction? This introduction aims to explain the relevance of the exception (Part B), situate the papers that are part of the symposium (Part C) and indicate what has been jurisprudentially achieved despite the exception (Part D).
Topic:: International Law, Sovereignty, Fishing, and Disputes
Political Geography:: Global Focus

355. NATO in the North: The emerging division of labour in Northern European security

Author:: Matti Pesu
Publication Date:: 09-2023
Content Type:: Working Paper
Institution:: Finnish Institute of International Affairs
Abstract:: The Russian war of aggression has rendered Northern Europe an increasingly significant region for Euro-Atlantic security. A stable and secure Northern Europe is a critical precondition for a safe and stable Euro-Atlantic region. The alliance should treat Northern Europe as a strategic whole although the different subareas of Northern Europe have their distinctive security dynamics and concerns. NATO is currently improving its deterrence and defence posture. It is simultaneously shifting its military strategy from a model of deterrence by reinforcement to one of deterrence by denial. NATO’s evolving posture and strategy in Northern Europe should be underpinned by a more explicit division of labour. The regional allies and stakeholders can be divided into four categories in terms of their role in regional security: frontline nations, hubs, security providers and the ultimate security guarantor. The regional frontline nations include the Baltic states, Finland and Poland, which can also play a role as hubs and even security providers along with the United Kingdom and Germany. Denmark, Sweden and Norway are first and foremost hubs. The United States remains the ultimate security guarantor of the area.
Topic:: Security, Defense Policy, NATO, and Deterrence
Political Geography:: Europe, Nordic Nations, Arctic, and Baltic Sea

356. Enhancing small state preparedness: Risks of foreign ownership, supply disruptions and technological dependencies

Author:: Mikael Mattlin, Shaun Breslin, Elina Sinkkonen, Liisa Kauppila, and Annika Björkdahl
Publication Date:: 08-2023
Content Type:: Working Paper
Institution:: Finnish Institute of International Affairs
Abstract:: The post-Cold War liberalist view, according to which interdependences supported a virtuous cycle of mutual gains, has given way to a realist-tinged view that regards economic interdependence as a cause of insecurity and an element in conflicts. In this new environment of increasing great power competition and technological decoupling, all states are not created equal. Major states such as the United States and China can be system shapers, whereas small states tend to be system takers. Unlike smaller states, they have a greater ability to use their investment leverage, supply chain dominance and control of core technologies. For smaller states with open economies, such as Finland and Sweden, these capabilities of major powers create vulnerabilities in the form of security risks of foreign ownership, supply disruptions and critical technological dependencies. The report explores how small states can mitigate such risks. A series of innovative Delphi backcasting exercises in Finland and Sweden brought together 113 sectoral experts and generalists to ponder ways to prevent dystopian scenarios from unfolding. The target years of the scenarios extended from 2027 to 2035, encouraging ideas on both short- and longer-term solutions. Instead of aiming for a consensus of expert views, the process sought to produce a variety of effective means and measures that a small state could choose to adopt. The exercise consisted of nine scenarios, presented as comic art. The narratives on the risks of foreign ownership focused on 1) acquisitions of gaming companies gathering personal data, 2) transfers of real estate ownership in Lapland and 3) venture capital investments in emerging technology start-ups. The scenarios on supply disruptions dealt with 4) discriminatory practices limiting access to antibiotics, 5) political retaliation limiting access to water treatment components and 6) sanctions on wind power materials, components and minerals. As for high technology dependencies, the cases included 7) the maintenance of military technology, 8) the cybersecurity of health technology and 9) the supply of chemicals for research and development activities. According to the report, small states have the least leeway in navigating the risk environments created by technological dependencies, whereas the toolkits to tackle the potential dangers of foreign ownership and supply disruptions are more extensive. Although different issues and insecurities require different bespoke solutions, all the risk categories call for active mitigation efforts. Most of the suggested Finnish and Swedish expert solutions can be clustered into three alternative approaches: protectionist/interventionist, liberal and technologically oriented. Protectionist/interventionist solutions would expand the state’s powers in controlling, guiding and limiting economic activities. Key suggestions included: covering acquisitions and greenfield investments in national foreign direct investment screening screening real estate acquisitions with a wide range of countries of origin imposing country-specific limitations to real estate acquisitions screening venture capital investments in emerging technologies initiating a national security act to limit foreign control rapidly imposing country- and company-specific limitations to bids in critical industries increasing tariffs supporting domestic or EU-level production through subsidies and industrial policy friendshoring the production of critical goods expanding the scope of supply stockpiling in pharmaceuticals and water treatment components The more liberal approach towards national preparedness would focus on solving the challenges primarily through carrots instead of sticks – to avoid limiting entrepreneurial freedoms and interfering with the dynamics of the capitalist market economy. The proposed solutions included: initiating value debates to guide individuals’ choices when accepting investments formulating a national innovation strategy to boost domestic companies’ operating conditions in emerging technology fields teaching “technology literacy” to guide the use of foreign-owned products engaging all stakeholders in making decisions on foreign ownership diversifying the sources of critical goods such as antibiotics enhancing awareness of risks and making “plan Bs” in supply chain management deepening the EU’s single market to offer genuine scalability opportunities for start-ups The third, more technologically oriented approach would rely on new innovations or technical solutions to enhance small state preparedness. Key ideas included: innovating new medicines to replace antibiotics prioritising non-conventional technologies such as small modular reactors (SMRs) enhancing domestic capacity to produce key components with 3D printing researching alternative materials to replace critical chemicals developing the recycling, recovery and transportation of critical chemicals adopting geofencing and coding solutions to enhance cybersecurity designating emerging technologies as focus areas in higher education increasing the adaptability of technical solutions through standardisation These three approaches prioritise different key solutions for enhancing small state preparedness. However, they represent generic policy preferences rather than ready-made policy recommendations. Ideally, states can formulate their own pick-and-mix toolkit by combining elements from the different approaches. The complementary nature of some of the expert views was also suggested by the fact that many – even most – respondents argued for diversification as a solution to various challenges. For example, and regardless of the chosen strategy, tendering rules could be improved by placing quality over price, taking geopolitical risks into account and allowing multiple winners in contrast to the currently dominant winner-takes-it-all logic, which leads to overly concentrated supply chains. Moreover, at least minor legislative tightenings were widely proposed to be made on foreign ownership – especially with regard to that of nationals of authoritarian states. These changes were, however, typically proposed to be complemented with such balancing acts as long-term leases and incentives to develop and acquire domestic products and companies. Ultimately, by highlighting alternative approaches to small state preparedness, this report seeks to encourage democratic discussion on a broader political choice: what type of state and economy do we want in the future? It is not only their identity that guides what states do; adopted policies and means also shape state identities over time.
Topic:: Security, Science and Technology, Supply, and Geoeconomics
Political Geography:: China, Finland, Asia, Sweden, and United States of America

357. Mapping Pathways for Peace through the Composition of Official Development Assistance

Author:: Jannie Lilja and Gary Milante
Publication Date:: 08-2023
Content Type:: Working Paper
Institution:: Stockholm International Peace Research Institute
Abstract:: Mapping the changing composition of official development assistance (ODA) against peace and conflict patterns in recipient countries over time can enhance the understanding of how pathways to peace look like in practice. This working paper presents empirical findings from more comprehensive research into the composition of ODA across aid recipient countries in the period 1990–2020. ODA is broken down into humanitarian, development and peacebuilding aid components. While development assistance is found to dominate across all types of country contexts, and the humanitarian share tends to be larger during conflict, peacebuilding assistance varies by conditions in countries. Post-conflict countries that avoid conflict relapse receive significantly higher shares of peacebuilding aid compared to post-conflict countries that relapse. A ternary graph is introduced to strategically track the composition of the total ODA envelope at the country level during different time periods. The findings suggest that a more effective future deployment of ODA for the advancement of peace and stability is possible.
Topic:: Foreign Policy, Development, Conflict, and Peace
Political Geography:: Global Focus

358. Governance Practices in Turkey: A Comparative Perspective

Author:: Dimitris Tsarouhas
Publication Date:: 01-2023
Content Type:: Working Paper
Institution:: Hellenic Foundation for European and Foreign Policy (ELIAMEP)
Abstract:: Turkey’s latest National Development Plan seeks to attain economic and social development equal to that of the world’s most prosperous states. By structuring expectations and incentives for economic and political actors, institutions play a key role in achieving sustainable, long-term development. This paper provides a systematic longitudinal analysis of core governance indicators which shed light on Turkey’s evolution over time from a comparative perspective. The results point to a sharp decline in the institutional efficacy of the Turkish apparatus of state vis a vis core aspects of the country’s development agenda, especially with regard to the rule of law, public administration, regulatory capacity, and predictability. Turkey’s declining scores in recent years fly in the face of its political agenda and severely undermine welfare gains made in the early 21st century.
Topic:: Development, Economics, Governance, and Domestic Politics
Political Geography:: Turkey and Middle East

359. Made in Europe: An EU Green Industrial Plan to respond to the challenge of US and Chinese protectionism

Author:: Alekos Kritikos and George Pagoulatos
Publication Date:: 01-2023
Content Type:: Working Paper
Institution:: Hellenic Foundation for European and Foreign Policy (ELIAMEP)
Abstract:: The EU needs to urgently formulate a response to US and Chinese protectionism. US decarbonization legislation poses a threat of deindustrialization for Europe. Europe needs a plan to support EU green, industrial and technological competitiveness, while protecting European cohesion and the single market, and promoting European strategic autonomy. Relaxing EU state aid rules must be an inevitable first component of Europe’s response. But this would overwhelmingly benefit the stronger economies of Germany and France, undermining EU cohesion and the integrity of the single market. Thus, the second component of EU response must be a European Sovereignty Fund, of a size commensurate to the magnitude of the challenge. The new Fund must support value chain categories that include as many EU member states as possible. SURE, extended to encompass the energy crisis and green transition, should be an integral part of the mix, and so should promoting technological skills and reskilling for the “Clean Tech Economy”. Investment funding should seek to contribute to vertical integration, including as many stages in the supply chain as possible. It should contribute to the return of specific supply chains and production units from third countries to the EU and seek to include the EU’s weakest economies. Subsidies should rise if the investment is cross-border in nature and carry a bonus if made in an EU region with a low GDP per capita compared to the EU average. Funding could also promote European strategic autonomy by including cross-border partnerships of EU member states in the defence technology industry. It should involve new funding rather than simply recycling money from existing programmes, and certainly avoid deploying undisbursed resources from the Recovery & Resilience Fund.
Topic:: European Union, Investment, Industry, Protectionism, and Strategic Autonomy
Political Geography:: China, Europe, and United States of America

360. Turkey’s Kurds: Kingmakers in the upcoming elections?

Author:: Evangelos Areteos and Ekrem Eddy Güzeldere
Publication Date:: 01-2023
Content Type:: Working Paper
Institution:: Hellenic Foundation for European and Foreign Policy (ELIAMEP)
Abstract:: Surveys show profound changes in the social attitudes of Kurds in Turkey. Younger Kurds are more liberal socially and more flexible politically. The years 2015–2016 marked a turning point for Kurdish society and brought different attitudes to light among both impoverished and middle-class Kurds. The AKP has been losing Kurdish support because of their alliance with the nationalist MHP and policies perceived as being anti-Kurdish. The CHP, while starting very low, has been gaining Kurdish support. The CHP’s strategy of reconciliation and talking about crimes committed against the Kurds in the past has been paying off. While the “Table of Six” does not offer much in the way of concrete benefits for the Kurds, some parties in the People’s Alliance (e.g. Deva, Gelecek) are more progressive vis-a-vis Kurdish demands.
Topic:: Elections, Domestic Politics, Kurds, and Political Parties
Political Geography:: Turkey and Middle East

361. Hydrodiplomacy and the Food, Water and Energy Nexus: A holistic approach for transboundary cooperation and peace

Author:: Fadi Comair
Publication Date:: 02-2023
Content Type:: Working Paper
Institution:: Hellenic Foundation for European and Foreign Policy (ELIAMEP)
Abstract:: The rapid social and economic development in the world is leading to increased levels of water stress that point to potential water crises. As the most vital and strategic of natural resources, water can serve as an instrument of domination or of cooperation. Given the presence of key geopolitical concerns in the Near East, regional hydro-diplomatic cooperation is necessary to ensure fair sharing of the resource and to avoid additional tensions and conflict. Nine of the seventeen EMME countries are below the absolute water scarcity threshold of 500 m3/year per capita, including all six countries in the Gulf region, Jordan and Palestine. Those countries that share major transboundary basins in the EMME region such as the Nile, Jordan and Tigris-Euphrates basins are subject to multiple challenges which include unilateral water resources management, water scarcity, and environmental degradation leading to food insecurity. Hydrodiplomacy is a tool for applying integrated water resource management at a national and transboundary level in accordance with a cooperative model seeking peace among riparian countries. Multiple UN agencies contribute to bringing riparian countries together with a view to fostering dialogue and the sharing of information on water management and transboundary cooperation.
Topic:: Development, Diplomacy, International Cooperation, Water, Food, Geopolitics, and Energy
Political Geography:: Europe and Middle East

362. The Greek Defence Sector: Turning the Page?

Author:: Antonis Kamaras
Publication Date:: 02-2023
Content Type:: Working Paper
Institution:: Hellenic Foundation for European and Foreign Policy (ELIAMEP)
Abstract:: From the 1980s to the 2000s, Greece’s defence industry was mismanaged and failed to utilize Greece’s high defence expenditures to become innovative. The impact of Greece’s fiscal crisis and the subsequent expansion of the Turkish threat mean that both economics and geopolitics now favour an invigorated Greek defence sector. The first major weapons procurement programme since the end of Greece’s fiscal crisis has not meaningfully involved the Greek defence sector. Yet the sector’s future prospects have improved, assured by the need for the sector to be financially viable and internationally competitive and by the broader awareness of the defence sector as a building block in national defence. The EU’s growing role in Europe’s collective defence, driven by continent-wide geopolitical developments and industrial imperatives, will also boost the prospects of the Greek defence sector. Mutually reinforcing obstacles still hamper the Greek defence sector’s progress: (a) a polity which privileges distribution over capital investments in its fiscal choices, and (b) an officer corps which lacks the degree of autonomy to co-create novel defence solutions together with the Greek defence sector. Despite these obstacles, the ongoing Turkish threat engenders national insecurity within Greece to such an extent that it can drive the sustainable growth of the Greek defence sector.
Topic:: Defense Policy, Geopolitics, Innovation, and Defense Industry
Political Geography:: Europe, Turkey, and Greece

363. Domestic implementation of European Court of Human Rights’ judgments related to immigration in Greece

Author:: Dia Anagnostou
Publication Date:: 02-2023
Content Type:: Working Paper
Institution:: Hellenic Foundation for European and Foreign Policy (ELIAMEP)
Abstract:: In recent decades, the European Court of Human Rights has evolved into a leading judicial body which examines and identifies violations committed by states in the management of migration and asylum. Greece is one of the countries that has been condemned in a large number of judgements relating to administrative detention, reception and accommodation conditions, the treatment of migrants by the police and border authorities, the asylum system, the treatment of unaccompanied minors, and human trafficking. This paper examines the Greek authorities’ compliance with the ECtHR judgements in this area. It focuses on general measures which relate to broader changes in the legislation and case law, as well as on administrative practice in Greece. It analyses the obstacles and difficulties present in this area, and it makes policy recommendations. It argues that a new approach is needed to Greece’s compliance with regard to the human rights of migrants and refugees. This approach should be focused on structural reforms and it should have the express commitment of the country’s political leadership. It would require systematic efforts to instil a new mindset within the public administration that is supportive of human rights protection as a priority and democratic responsibility, rather than as an externally imposed, necessary evil.
Topic:: Migration, Refugees, Judiciary, Asylum, and European Court of Human Rights (ECHR)
Political Geography:: Europe and Greece

364. The Syrian Civil War Twelve Years On: Can There Be a Constructive Role for Greece?

Author:: Ioannis N. Grigoriadis and Loukas I. Papavasileiou
Publication Date:: 02-2023
Content Type:: Working Paper
Institution:: Hellenic Foundation for European and Foreign Policy (ELIAMEP)
Abstract:: Continual and ever-growing foreign involvement led to the internationalization of the armed conflict and turned Syria into a battleground for the strategic competition of several powers. The Kremlin has long viewed Hafez and Bashar al-Assad as indispensable partners in the Middle East and has repeatedly offered its diplomatic and military support in an attempt to achieve its own strategic objectives. Given the destabilizing effects the unending Syrian crisis has had on Middle Eastern and Eastern Mediterranean security, Greece maintains a profound interest in the resolution of the conflict. Greece appointed a Special Envoy for Syria in May 2020 with a view to reinvigorating its policy vis-à-vis the Syrian crisis. Greece’s successful re-engagement with key Arab countries and improved relations with other regional actors could pave the way for a more prominent Greek role in Syria. This could entail reinforcing its diplomatic cooperation with the EU Delegation to Syria, leading the EU humanitarian relief effort following the devastating earthquakes that hit Syria on 6 February 2023, and formulating a realistic and forward-looking strategy for the future of the Syrian people, including provisions for the voluntary repatriation of refugees and the protection of minority rights.
Topic:: Foreign Policy, Diplomacy, Refugees, Political stability, Syrian War, and Armed Conflict
Political Geography:: Middle East, Greece, and Syria

365. Dersimli Kemal for President?

Author:: Ekrem Eddy Güzeldere
Publication Date:: 03-2023
Content Type:: Working Paper
Institution:: Hellenic Foundation for European and Foreign Policy (ELIAMEP)
Abstract:: As of 6 March 2023, Kemal Kılıçdaroğlu, chairman of the CHP, is the joint candidate of the largest Opposition alliance. As such, for the first time, an Alevi has the chance of occupying one of the highest positions in Turkey. Since he is also Kurdish, he represents the two largest ethnic and confessional minorities in Turkey. Kemal Kılıçdaroğlu (74) was born in a small village in Dersim/Tunceli province. He managed to become the director of a state institution and has been the chairman of the CHP since 2010. The Alevi are by far the largest non-Sunni religious group in Turkey, representing roughly 15–20 percent of the population. There are huge differences in the definition of what an Alevi is, ranging from Anatolian Muslims to a branch of Shia Islam and from a religion in its own right to a culture. In both the Ottoman Empire and the Republic of Turkey, Alevis have been subject to persecution, discrimination and exclusion. In 1937/38, the state committed large-scale atrocities against the population of Dersim. The burning of a hotel in 1993 during an Alevi festival proved to be a turning point for Alevi awareness and civil society organization. The AKP launched an ‘Alevi opening’ in 2008 to address issues including recognition for Alevi places of worship and religious instruction; although the initiative continued until 2011, nothing concrete was achieved. Prejudices, discrimination and the othering of Alevis continue to this day. Since 2018, Kılıçdaroğlu has been the architect of the National Alliance; consisting of six diverse parties since 2022, the opposition group has been dubbed the ‘Table of Six’. In the summer of 2022, Alevi Cem Houses were attacked. President Erdoğan subsequently visited a Cem House for the first time in 15 years; in fall 2022, he announced the creation of a Directorate to deal with Alevi issues. On 14 May 2023, in the Republic’s centenary year, an Alevi could become president of Turkey. After many years of polarization, this could send out a message of unity, of differences bridged and differences accepted.
Topic:: Elections, Domestic Politics, and Political Parties
Political Geography:: Turkey and Middle East

366. Drafting Greece’s “Internal Security Strategy” – Challenges and Prospects

Author:: Panayotis Tsakonas and Triandafyllos Karatrantos
Publication Date:: 03-2023
Content Type:: Working Paper
Institution:: Hellenic Foundation for European and Foreign Policy (ELIAMEP)
Abstract:: The radical change in the structure of the international system caused a scientific and political revolution in the definition and concept of security. Issues such as the climate crisis, forced displacements and extreme nationalism have led the interest and especially the debate on achieving security from external to internal threats. The focus is now on the main “object of reference” of security which is not the state or some sub-state groups, but “the individual”/”the citizen”. In the modern globalized environment, all the risks that threaten the daily life of citizens require dealing with the concept of security in a “holistic” and, at the same time, more “human-centered” way. Greece lacks an institutional document for the internal security strategy. There are structural reasons that make a comprehensive reform of the internal security sector necessary. In addition to the established weaknesses and inadequacies of specific agencies and/or services of the internal security system, the overall organic interconnection between crisis management services is still required. The first lesson from the effects of the pandemic is the need for the evolution of Greece into a “Modern National Security State”. Greece, due to its geographical position on the external borders of the EU, as well as the crises it has experienced in recent years, faces a series of internal security threats and challenges. Security and respect for fundamental rights are not mutually conflicting but coherent and complementary objectives. The Strategy will help build an internal security governance system and a central coordination process.
Topic:: Security, Governance, and European Union
Political Geography:: Europe and Greece

367. A New New Turkey? What an Opposition Victory Would Mean for Ankara’s Foreign Policy

Author:: Nicholas Danforth
Publication Date:: 04-2023
Content Type:: Working Paper
Institution:: Hellenic Foundation for European and Foreign Policy (ELIAMEP)
Abstract:: The opposition foreign policy platform seeks to improve relations with the West while simultaneously continuing to pursue a more independent foreign policy. Securing the safe, voluntary and legal return of Syrian refugees through rapprochement with the Assad regime, as the opposition proposes, will prove a non-starter. Ultimately, a democratic Turkey that calibrates its foreign policy to the interests of its citizens rather than the interests of one man will be a stronger and more reliable actor on the global stage.
Topic:: Foreign Policy, Elections, and Domestic Politics
Political Geography:: Turkey and Middle East

368. Diplomatic scramble: Greek foreign policy towards Libya

Author:: Constantine Capsaskis
Publication Date:: 04-2023
Content Type:: Working Paper
Institution:: Hellenic Foundation for European and Foreign Policy (ELIAMEP)
Abstract:: Libya became a country of immediate interest to Greece following its 2019 Memorandum of Understanding with Turkey. Greece engaged in a flurry of diplomatic activity in the aftermath of the MoU, both within Libya and the wider region, to counter Turkey’s momentum with Tripoli. The complex political situation in Libya and its many facets (proxy conflicts between regional and international players, competition for energy resources, and other factors including religion) compound the difficulties confronting Greek efforts to shield Greece’s interests. European division over Libya has led Greece to seek other bilateral approaches, primarily through cooperation with France and Egypt. Turkey’s attempts to normalize relations with its regional interlocutors (primarily Egypt, Israel and Greece) following the devastating earthquake that struck the country in February 2023 may yet change conditions on the ground in Libya, though it is still too early to tell.
Topic:: Foreign Policy, Diplomacy, and Bilateral Relations
Political Geography:: Turkey, Greece, Libya, and North Africa

369. The EU’s approach to climate mobility: Which way forward?

Author:: Helena Hahn and Melanie Fessler
Publication Date:: 10-2023
Content Type:: Working Paper
Institution:: European Policy Centre (EPC)
Abstract:: Climate mobility as a global issue needs strategic thinking about how people adapt, and the role mobility can play in alleviating the adverse effects of climate change. This Discussion Paper analyses what the EU is doing to deal with climate mobility. It addresses the complicated relationship between climate change, mobilities, and related challenges in modelling and projecting future scenarios. It also shows the multilateral policy developments relating to climate and migration and the EU’s actions on climate mobility, with a focus on two interrelated challenges: 1. Policy (in)coherence and counterproductive narratives. 2. Weak institutional coordination. The EU’s funding landscape is also addressed, focusing on the challenges of mainstreaming and monitoring when assessing the funds dedicated to this cause. It concludes with recommendations on impacts, multilateral engagement, policy, and funding, which outline practical steps to be taken in the short and long-term.
Topic:: Climate Change, European Union, and Mobility
Political Geography:: Europe

370. Towards common accord? The European Union contemplates treaty change

Author:: Andrew Duff
Publication Date:: 10-2023
Content Type:: Working Paper
Institution:: European Policy Centre (EPC)
Abstract:: Numerous events have conspired to tempt the European Union to reform the way it is governed. Present constitutional arrangements were laid down in the Treaty of Lisbon in 2007 and are long overdue for revision. In recent months, parallel efforts have been made by the European Parliament and European Commission to articulate a prospectus for treaty amendment. The Council remains fearful and inarticulate, divided over the content and timing of any such reform. Andrew Duff returns to the current debate with a Discussion Paper analysing the EU treaty change. He previews emerging proposals from the European Parliament and European Commission, referring to the recent report of the Franco-German experts as well as other relevant contributions.
Topic:: Treaties and Agreements, European Union, Regional Integration, European Parliament, and European Commission
Political Geography:: Europe

371. Ending the HIV epidemic in Europe: Moving toward the 2030 sustainable development goals

Author:: Elizabeth Kuiper and Danielle Brady
Publication Date:: 11-2023
Content Type:: Working Paper
Institution:: European Policy Centre (EPC)
Abstract:: Despite significant progress, the human immunodeficiency virus (HIV) epidemic continues to pose a public health threat in Europe. The COVID-19 pandemic has exacerbated challenges by disrupting healthcare services and diverting attention and resources away from HIV prevention and treatment. Stigma and discrimination against those affected by HIV persist and are additional obstacles, slowing down progress to end the HIV epidemic. This Discussion Paper explores the current HIV prevalence in Europe, identifies barriers and challenges, and offers policy recommendations to overcome these obstacles and meet the sustainable development goals targets in Europe. The Paper emphasises the need for renewed political commitment and cooperation among the EU and its member states to prioritise HIV as well as for strong partnership and collaboration between authorities and stakeholders concerned, ultimately striving for success in ending the epidemic.
Topic:: HIV/AIDS, European Union, Public Health, and COVID-19
Political Geography:: Europe

372. Violence against women: A public health crisis

Author:: Victoria Pedjasaar
Publication Date:: 11-2023
Content Type:: Working Paper
Institution:: European Policy Centre (EPC)
Abstract:: In the EU, a third of women over the age of 15 have experienced physical or sexual violence and over half have been sexually harassed. Although often overlooked, the majority of (workplace) violence takes place in the healthcare sector as healthcare professionals are 16 times more at risk of violence in comparison to other occupations. Violence does not only manifest in abusive behaviour toward workers on duty but can also be perpetrated on women as receivers of healthcare. High rates of violence in healthcare, brought on and exacerbated by gender stereotypes and inequality, point to dysfunctional health systems. This Discussion Paper provides policy recommendations on the way forward for the EU member states, taking a closer look at: Gender-based violence against healthcare workers. Obstetric and gynaecological violence against women. Gender-based violence as a story of gender inequality. Legislation and policies that protect women.
Topic:: European Union, Women, Inequality, Gender Based Violence, and Legislation
Political Geography:: Europe

373. Digitalisation: An enabler for the clean energy transition

Author:: Simon Dekeyrel and Melanie Fessler
Publication Date:: 01-2023
Content Type:: Working Paper
Institution:: European Policy Centre (EPC)
Abstract:: Russia’s invasion of Ukraine and the resulting energy crisis are a painful reminder that Europe must reduce its dependence on fossil fuels. To build a sustainable, secure and affordable energy future, the coming years will require a massive scale-up of renewable energy across the EU and a tremendous effort by European businesses and households to cut their energy consumption. To wrap up the "Digitalisation for a Clean Energy Transition" project undertaken by the EPC and the Vodafone Institute for Society and Communications, this Discussion Paper examines how digitalisation can act as a catalyst for the clean energy transition in Europe. The study considers the regulatory framework necessary to coordinate and promote synergies between energy and digital policies and support the twin green and digital transformation of the European energy system. To fully unlock the potential of digitalisation in the transition towards smart and sustainable energy systems, the EU and its member states need to: Accelerate work on a common European energy data space, characterised by interoperable data standards, adequate incentives for data sharing, data protection and privacy safeguards for consumers. Ensure that citizens possess the necessary digital skills and information to reap the full benefits of the twin transition in terms of consumer empowerment and access to affordable and clean energy. Put in place the necessary safeguards regarding the cybersecurity of energy networks to ensure that the digital transformation does not jeopardise the resilience of EU energy systems. Use financial tools to accelerate the deployment of digital solutions in the energy sector and equip existing networks with the necessary digital infrastructure. For digitalisation to deliver, it needs to be steered in the right direction. For this, we need an adequate policy and financing framework to make sure that the twin transition not only empowers people and businesses to play an active role in accelerating the transition to clean energy sources but also contributes to greening the digital and ICT sector.
Topic:: Cybersecurity, Fossil Fuels, Digitalization, Energy, Russia-Ukraine War, and Energy Transition
Political Geography:: Europe

374. Resetting the EU’s business model after the watershed

Author:: Marco Buti and Marcello Messori
Publication Date:: 02-2023
Content Type:: Working Paper
Institution:: European Policy Centre (EPC)
Abstract:: The EU’s response to the COVID-19 pandemic raised hopes of an acceleration towards deeper economic and political integration. Most optimists saw Next Generation EU as a paradigm shift that would result in the establishment of a permanent central fiscal capacity. Such hopes were reinforced by the Russian aggression against Ukraine; if not now, when? While the EU displayed remarkable unity in sanctioning Russia, the hopes for another leap forward in integration have not yet materialised. This Discussion Paper argues that the current crisis is more existential than the pandemic, as it questions Europe’s business model: an energy-intensive, mercantilist production setup is not sustainable going forward, for domestic and global reasons. It also argues that the EU’s reaction to the US Inflation Reduction Act may be a break: preserving the single market prohibits a go-it-alone policy constituted of exclusively national reactions. Going forward, the authors believe there needs to be an effective centralised strategy based on three overarching considerations: (i) The EU needs a new industrial policy to reinforce value chains, close technology gaps with the US and China, and improve its economic model's competitive advantages; (ii) The implementation of this policy requires the EU's member states to be less risk averse and more open to common solutions; (iii) A necessary, though not sufficient, condition for a cooperative game is an effective implementation of the national Recovery and Resilience Plans that give access to the Recovery and Resilience Facility’s funds. Achieving those goals is key to rebuilding political trust, reviving the ‘Next Generation EU spirit’, and mitigating the impact of the war in Ukraine on the European economy.
Topic:: Industrial Policy, European Union, Business, Regional Integration, and Value Chains
Political Geography:: Europe

375. Addressing Cohesion Policy’s identity crisis in a changing European Union

Author:: Alison Hunter
Publication Date:: 02-2023
Content Type:: Working Paper
Institution:: European Policy Centre (EPC)
Abstract:: Since the late 1980s Cohesion Policy has been one of the cornerstone policies of the European Union. However, nowadays, a different, bolder Cohesion Policy debate is needed, reflecting a radically changed global environment. This Discussion Paper focuses on the upcoming review of the post-2027 Multi Annual Financial Framework and the debate concerning the future EU Cohesion Policy. It argues that Cohesion Policy’s purpose requires reinvention, not an incremental upgrade. Four overarching themes are analysed, reframing Cohesion Policy with a strategic, long-term investment perspective: EU resilience, security, strategic autonomy, and reforms. The author then proposes five recommendations which weave together these themes with the policy’s long-standing core features: Acknowledge the need to review the Cohesion Policy’s purpose. The EU should breathe new life into the Cohesion Policy debate. Revitalise Cohesion Policy’s long-term value by defending its pillars. The EU should re-confirm Cohesion Policy’s role as a structural policy. Position Cohesion Policy as the ‘guardian’ of EU place-based policymaking. Cohesion Policy should champion the “future-proofing” of regional resilience. Articulate Cohesion Policy’s role in the evolving EU governance and reform agenda. The EU should reach beyond the Recovery and Resilience Facility to reclaim Cohesion Policy’s role in structural reform. Improve Cohesion Policy’s convening power to catalyse deeper EU innovation cooperation. The future Cohesion Policy must deliver a more coordinated approach to the EU’s innovation agenda. The Paper concludes that the future Cohesion Policy should evolve in lockstep with citizens’ needs. This will not be easy. As discussions on the EU’s future have been sidelined in this crisis-prone area, the challenges ahead require strong leadership and coordination. The post-2027 EU Cohesion Policy will have much to contribute to rebuilding the EU’s future vision.
Topic:: Security, Governance, Reform, European Union, Regional Integration, Social Cohesion, Resilience, and Strategic Autonomy
Political Geography:: Europe

376. Raising the stakes on constitutional reform: The European Parliament triggers treaty change

Author:: Andrew Duff
Publication Date:: 03-2023
Content Type:: Working Paper
Institution:: European Policy Centre (EPC)
Abstract:: The European Parliament, for the first time, has used its powers to trigger a revision of the EU treaties. Its central demand is to change the decision-making procedure behind the passerelle clause from unanimity to qualified majority voting. However, the EU Council has so far refused to submit Parliament’s request to the European Council — in breach of its treaty obligations. At the same time, MEPs continue to develop wider reform proposals to make the government of the EU more robust, decisive, and democratic. With the European Parliamentary elections taking place next year, now is a good time for parliamentarians to take stock of their own performance, review their place in the governing system of the Union, and, other things being equal, prepare for future reform. In this Discussion Paper, Andrew Duff explains that, in an ideal world, more could be achieved under the existing treaties, and the EU could avoid the always complex, often unpopular, and usually protracted task of revising them. With another treaty change on the cards, the Paper analyses the current state of affairs and suggests that the heads of government need the assistance of a reflection group to prepare for a new Convention.
Topic:: Treaties and Agreements, Reform, European Union, Constitution, and European Parliament
Political Geography:: Europe

377. Quantum technologies and value chains: Why and how Europe must act now

Author:: Georg Riekeles
Publication Date:: 03-2023
Content Type:: Working Paper
Institution:: European Policy Centre (EPC)
Abstract:: As next-generation foundational technologies, quantum computing, communication, and sensing carry significant economic and security implications that go to the core of today’s strategic competition. In contrast with the US, where Big Tech actors dominate, Europe’s strengths lie in a vibrant ecosystem of research organisations and start-ups. This growing ecosystem is now at a critical juncture to develop into an internationally competitive European industry. This paper is based on research and a series of workshops conducted with European policymakers, stakeholders and industry actors looking into Europe’s technological position in contested international value chains. It proposes ten recommendations for the EU’s industrial policy mix under the following headings: KNOW – Embrace tech forecasting at the EU level COOPERATE – Combine European efforts in an EU Quantum Industrial Alliance INVEST – Mobilise European public-private capital for industrial scale-up PROTECT – Deploy Europe’s defensive toolbox prudently In a year that will see the launch of the EU Sovereignty Fund and adoption of the European Chips Act, quantum stands as a test case for the EU’s technological competitiveness and industrial policy agenda.
Topic:: Security, Economics, European Union, Industry, Quantum Computers, and Value Chains
Political Geography:: Europe

378. Funding the EU’s external migration policy: ‘Same old’ or potential for sustainable collaboration?

Author:: Evangelia (Lilian) Tsourdi, Nasrat Sayed, and Federica Zardo
Publication Date:: 04-2023
Content Type:: Working Paper
Institution:: European Policy Centre (EPC)
Abstract:: In this Discussion Paper, the authors examine changes in the EU funding landscape relating to migration policy and provide recommendations on how to maximise the benefits of cooperation. Since 2015, when the EU was first exposed to a significant rise in irregular arrivals from neighbouring countries, funding has acquired increasing salience, leading to the mobilisation of €7 billion through Trust Funds and the creation of a specific heading devoted to migration and border management in the EU’s Multiannual Financial Framework 2021-2027. The authors look closely at the funding dimension of Talent Partnerships, the latest initiative to support legal migration to the EU, and the contradictions. Given funding’s ability to enhance cooperation with third countries, the Paper focuses on how the EU could take several steps toward ensuring sustainable collaboration. These include moving towards long-term planning, embedding transparency guarantees in the operationalisation of its initiatives, scaling up Talent Partnerships for more impactful and mutually beneficial cooperation, and striving for third-country ownership. Furthermore, in the context of growing political and economic instability around the world, financial resources should equally be used to address the different components of migration processes, such as local development, legal migration, circular migration, integration, but also displacement and forced (im)mobilities. At the same time, long-standing issues of accountability and transparency should be addressed through new instruments. The conditions through which funding can act as a catalyst for sustainability and co-development are also analysed, and recommendations are provided on the next steps for EU action.
Topic:: Migration, European Union, Borders, and Transparency
Political Geography:: Europe

379. The US-EU Trade and Technology Council: Assessing the record on data and technology issues

Author:: Juan Carlos Fernández-Rodríguez and Frances G. Burwell
Publication Date:: 04-2023
Content Type:: Working Paper
Institution:: European Policy Centre (EPC)
Abstract:: Since its creation, the Trade and Technology Council (TTC) has endorsed a Declaration for the Future of the Internet (DFI), designed a Joint Roadmap for transatlantic cooperation on artificial intelligence (AI) and identified quantum technology as a high priority. While these achievements can be considered success stories, this Discussion Paper argues that the TTC is now facing a dilemma. Different approaches to technology and digital governance and the lack of regulatory autonomy make the TTC best suited to address emerging issues that do not require changes in legislation. Yet, this is precisely what stakeholders want it to address. So, how can the TTC ensure its continuity without regulatory authority? The Paper offers five key recommendations: Make AI a test case and build from the lessons of the Joint AI Roadmap; Engage in issues where there is an initial strong value alignment and no regulation; Work on moonshot ideas such as the “metaverse” or low-earth orbit governance; Take oversight over the special task forces it has created to tackle critical issues such as the US Inflation Reduction Act (IRA); Think more actively about how to push its efforts into multilateral forums with like-minded partners.
Topic:: Science and Technology, European Union, Trade, and Data
Political Geography:: Europe, North America, and United States of America

380. Regulating platform work: How will this impact migrant workers?

Author:: Tommaso Grossi and Andreina De Leo
Publication Date:: 05-2023
Content Type:: Working Paper
Institution:: European Policy Centre (EPC)
Abstract:: Migrant workers in the platform labour market are vulnerable to double exploitation. First, as platform workers, they cannot enjoy the protections that employment law provides. Second, they can be subject to exploitation due to their migration and residence status, especially if undocumented. This Discussion Paper analyses the impact of the European Commission’s proposed Directive on improving the working conditions and rights of platform migrant workers. The proposed Directive's positive impact will likely be restricted by migrant employees' bargaining strength and non-EU platform workers' well-founded fears of reprisal. Therefore, targeted improvements to the proposed framework are needed to remove the structural barriers faced by migrant workers when accessing the labour market. This Paper offers six recommendations on how to move forward: Strike the right balance between retaining flexibility for genuine self-employed platform workers and enhancing protection through reclassification. Guarantee transparency and ensure non-discrimination in algorithmic management. Introduce effective measures against the risk of subcontracting and ensure the liability of subcontracting chains. Facilitate the involvement of civil society organisations with specific expertise on migrants’ rights as well as trade unions involved in defending the rights of platform workers to enhance the enforcement of rights and protections. Put in place binding measures to establish ‘firewalls’ for platform migrant workers who lodge complaints in the context of inspections by the labour authorities. Promote better access to the labour market for migrant workers and consider regularisation channels for undocumented migrants as the most effective way to prevent or fight exploitation.
Topic:: Employment, Labor Market, Migrant Workers, and Exploitation
Political Geography:: Europe

381. One step closer to getting the EU Migration Pact done. One step closer to ambitious change?

Author:: Alberto-Horst Neidhardt
Publication Date:: 06-2023
Content Type:: Working Paper
Institution:: European Policy Centre (EPC)
Abstract:: On 8 June, the Swedish Presidency put to the vote compromise texts on two vital elements of the EU asylum system: the rules governing the processing of asylum applications and those determining the state responsible for applicants, including a corresponding solidarity mechanism. A turning point was Italy getting on board after some concessions were made on how to apply the notion of safe third countries, making it easier to carry out returns to transit countries. Poland and Hungary voted against the proposals, and four other countries abstained – Malta, Bulgaria, Lithuania, and Slovakia – paving the way for the “historic” agreement. This Discussion Paper asks: What factors shaped the vote? What will future negotiations focus on, and what will be the impact of the reforms on the ground? Finally, what should come after the New Migration Pact? Trialogue negotiations are about to start, and the stakes have never been this high in EU asylum and migration policies. If the negotiations do not deliver reforms that can improve the European asylum system, it will undermine trust between member states, citizens’ confidence in the EU and its capacity to manage the migration phenomenon.
Topic:: Migration, European Union, and Asylum
Political Geography:: Europe

382. Leaving Dayton for Brussels: Reviving Bosnia’s constitutional reform

Author:: Berta López Domènech
Publication Date:: 06-2023
Content Type:: Working Paper
Institution:: European Policy Centre (EPC)
Abstract:: In December 2022, the European Council granted Bosnia and Herzegovina candidate status. However, to make EU membership a reality, Bosnia needs to address several conditions and implement major reforms. Almost three decades since the end of the Bosnian war, the country continues to be governed along sectarian lines and is overseen by an internationally appointed authority, the High Representative. Moreover, the ethnic provisions of the Dayton constitution discriminate against parts of its citizenry. This Discussion Paper stresses the need to reopen the debate on Bosnia’s constitutional reform, arguing that the EU should accompany the country’s efforts to become a fully functional and democratic state. A new constitution is vital to improving institutional functionality, streamlining decision-making, and guaranteeing equality for all citizens – all of which would ultimately allow for the closure of the Office of the High Representative. The EU should use the granting of candidate status to Bosnia as an opportunity to advance the conversation on reforming Bosnia's constitution per European democratic norms.
Topic:: Democratization, Reform, Constitution, and European Council
Political Geography:: Bosnia and Eastern Europe

383. Towards a cleaner air in Europe: Time for a stronger vision and more action

Author:: Annika Hedberg, Stefan Sipka, Simon Dekeyrel, Melanie Fessler, and Danielle Brady
Publication Date:: 07-2023
Content Type:: Working Paper
Institution:: European Policy Centre (EPC)
Abstract:: As scientific evidence on the impact of air pollution on human life continues to grow, accepting air pollution as a given side product of our economies and activities can no longer be tolerated. This Discussion Paper highlights what the EU needs to do to recognise clean air for what it is: a necessary component for healthy societies, people and long-term economic prosperity and social well-being in Europe. A stronger vision and framework for action is needed, and this paper recommends what the EU needs to do next. Have a stronger vision and framework for action by: Adopting an ambitious and comprehensive clean air agenda; Making cleaner air an integral part of the EU’s vision and framework for greater well-being; Improving enforcement of the air quality standards and monitoring; Raising awareness about the causes of air pollution, benefits of action and measures to be taken. Provide concrete measures to address air pollution by: Ensuring all key sectors, including agri-food, industry, energy and mobility, play their role; Encouraging, empowering and enabling regional, local and citizen action.
Topic:: European Union, Public Health, and Air Pollution
Political Geography:: Europe

384. A quantum cybersecurity agenda for Europe

Author:: Andrea García Rodríguez
Publication Date:: 07-2023
Content Type:: Working Paper
Institution:: European Policy Centre (EPC)
Abstract:: Cybersecurity plays an important role in Europe’s economic security. However, advances in quantum computing create a new set of challenges that compromise the level of security of everything happening online. Actors like the United States and some — but not all — EU member states are already taking action to counter current and emerging threats. Yet, European coordination will be necessary to ensure a harmonised and effective response. This Discussion Paper provides recommendations on how the EU could enhance its efforts to navigate cybersecurity risks. These include: 1. Establishing an EU Coordinated Action Plan on the quantum transition. 2. Establishing a new expert group within the European Union Agency for Cybersecurity with seconded national experts to exchange good practices and identify obstacles to the transition to post-quantum encryption. 3. Assisting in setting priorities for the transition to post-quantum encryption and pushing for cryptographic agility to respond to emerging vulnerabilities. 4. Facilitating political coordination between the European Commission, member states, national security agencies and ENISA to determine technological priorities and identify use cases for quantum-safe technologies. 5. Facilitating technical coordination at the EU level to address research gaps in quantum-safe technologies. 6. Exploring the use of sandboxes to accelerate the development of near-term applications of quantum information technologies.
Topic:: European Union, Cybersecurity, and Economic Security
Political Geography:: Europe

385. Soldiers out, civilians left behind: EU lessons from the evacuation of Kabul

Author:: Mihai Sebastian Chihaia and Georg Riekeles
Publication Date:: 08-2023
Content Type:: Working Paper
Institution:: European Policy Centre (EPC)
Abstract:: This is the introduction to a three-part Report that reviews the evacuation of Kabul, and the combined failures of NATO and the EU, amid the war in Ukraine. Even if Europe’s security debate has moved on to this bigger and more pressing challenge, the EU must heed the lessons from Kabul as it reviews its crisis management architecture and implements the Strategic Compass. The exact conditions of the Afghanistan evacuation might not be seen again for many years. Still, the EU must consider a range of other scenarios: European soldiers or citizens in danger needing evacuation from failing states or war zones, military support for humanitarian assistance and disaster relief, or even short-term stability support to governments and initial entry missions. This requires a commitment to, and building of, EU rapid deployment capacities that are effectively ready to be used, associated with appropriate crisis management structures for EU decision-making. These are the questions that have interested this project, whose examination is structured in three parts: A description of the central decision moments leading up to and during the evacuation from Afghanistan. An assessment of the main factors contributing to failure in anticipation, planning and execution. Recommendations regarding the EU’s crisis management architecture and capacity in the context of the implementation of the Strategic Compass.
Topic:: Security, NATO, and European Union
Political Geography:: Afghanistan, Europe, and South Asia

386. EU-Ukraine wartime trade: Overcoming difficulties, forging a European path

Author:: Svitlana Taran
Publication Date:: 08-2023
Content Type:: Working Paper
Institution:: European Policy Centre (EPC)
Abstract:: During the first year of Russia’s war in Ukraine, EU trade-liberalisation measures and EU-Ukraine Solidarity Lanes provided Ukraine with alternative export routes and allowed the country to reorient part of its exports to the EU market. However, the insufficient logistics capacity and lack of adequate coordination and cooperation during the operation of Solidarity Lanes led to tensions between Ukraine and its Eastern European neighbours. While a compromise between the European Commission and the Eastern European countries allowed the extension of temporary trade-liberalisation measures for a further year, resolving the immediate crisis, more is needed to ensure their smooth operation. This Discussion Paper provides recommendations on how the EU can further intensify efforts to facilitate Ukraine’s trade flows and prevent sudden trade disruptions and restrictions. These include: Enhance the strategic alignment and connectivity between Ukraine and the EU; Ensure security guarantees and increase the capacity of seaport corridors; Enhance coordination and unity between the Commission, EU member states and Ukraine; Avoid sudden and unjustified Solidarity Lanes' disruptions; Protect critical port and export infrastructure from Russia’s attacks; Facilitate EU-Ukraine trade liberalisation and Ukraine’s integration into the EU Single Market.
Topic:: Security, European Union, Trade Liberalization, Trade, and Russia-Ukraine War
Political Geography:: Russia, Europe, and Ukraine

387. Is the European Health Union ready for the challenges of the 21st century?

Author:: Elizabeth Kuiper and Danielle Brady
Publication Date:: 09-2023
Content Type:: Working Paper
Institution:: European Policy Centre (EPC)
Abstract:: The COVID-19 pandemic laid bare national health systems' unpreparedness and structural weaknesses. It also emphasised the disparities in national capabilities among European countries and the lack of a common European approach against cross-border health threats. As we enter a post-pandemic era, this Discussion Paper assesses the proposals under the European Health Union and sets out recommendations to address the identified shortcomings. These include: Adopting a more holistic approach by appointing a Vice President for Well-being. Strengthening crisis preparedness by elevating HERA to an agency. Promoting access and affordability by extending joint procurement. Strengthening the European health workforce by tackling shortages and addressing skills gaps. Mitigating the cost of inaction by increasing investment in health. Ensuring planetary health by promoting a Green European Health Union. Promoting Europe’s status as a global leader in health data by harmonising health data regulations with the European Health Data Space. Safeguarding the EU’s strategic autonomy by implementing the Versailles Declaration and strengthening supply chain resilience. Building on the EU’s Global Health Strategy by exploring global partnerships. This Paper builds on the findings of the European Policy Centre’s Task Force on the European Health Union. The multistakeholder Task Force was held under the auspices of the EPC's Social Europe and Well-being programme with the kind support of Amgen, MSD, Johnson&Johnson, SITRA and EIT Health.
Topic:: European Union, Public Health, COVID-19, and Strategic Autonomy
Political Geography:: Europe

388. Planetary health: A holistic vision for people and the planet

Author:: Danielle Brady
Publication Date:: 09-2023
Content Type:: Working Paper
Institution:: European Policy Centre (EPC)
Abstract:: The nexus between health and the environment has been underscored by crises such as COVID-19 and the climate crisis. As awareness of policy interlinkages grows, so does the need for more coordinated EU and national policymaking. Calls for a more holistic approach have long been recognised, but the pandemic has further emphasised the importance of dismantling existing barriers in policymaking to improve the health status of people, animals, and the planet. This Discussion Paper, funded by Sitra, the Finnish Innovation Fund, advocates for implementing a planetary health approach across all levels of governance to encourage transdisciplinary action and puts forward ten recommendations: Pursue coordinated policymaking by breaking down silos. Appoint an Executive Vice President for the Well-being Economy. Plan and implement national roadmaps and establish common indicators. Create best practices platforms. Adopt planetary health for health systems. Promote education on planetary health. Adopt a European-wide communication campaign. Invest in research and innovation. Foster the integration of the European Health Data Space with future data spaces. Work with international partners to adopt a global planetary health approach. Planetary health offers many benefits for health and the environment. However, without concentrated efforts to move beyond the traditional siloed approach to policymaking, the benefits may never be realised.
Topic:: Climate Change, Health, European Union, and COVID-19
Political Geography:: Global Focus

389. The Nexus Approach: Bringing together climate, human security, and demographic change in times of permacrisis

Author:: Eleonora Milazzo
Publication Date:: 10-2023
Content Type:: Working Paper
Institution:: European Policy Centre (EPC)
Abstract:: The start of a new institutional cycle and the development of the European Council's Strategic Agenda will raise concerns about the EU's ability to respond to multiple problems in a more systemic and conscious style. Therefore, a holistic nexus approach that combines greater inter- and intra-institutional collaboration with strategic vision and principled leadership will be essential if the EU is to deliver on complex challenges. It will play a vital role in the EU’s ability to deal with today’s permacrisis with regard to climate change, human security, and demographic transformations. This Discussion Paper retraces the genesis of the nexus approach in humanitarian and development cooperation to draw lessons learned for the EU’s strategic thinking around systemic and deeply interconnected problems. It shows how a conscious strategic vision, more coherence, and principled leadership will be crucial if the EU is to tackle complex challenges effectively.
Topic:: Climate Change, Demographics, European Union, Crisis Management, and Human Security
Political Geography:: Europe

390. Peninsula Plus: Enhancing U.S.–South Korea Alliance Cooperation on China, Multilateralism, and Military and Security Technologies

Author:: Jacob Stokes and Joshua Fitt
Publication Date:: 03-2023
Content Type:: Working Paper
Institution:: Center for a New American Security (CNAS)
Abstract:: The United States–Republic of Korea (ROK or South Korea) alliance has entered a critical phase. In 2023, the two countries will commemorate the 70th anniversary of signing their bilateral mutual defense treaty. This year also marks the first full year under national leaders President Joe Biden and President Yoon Suk Yeol. After several challenging years in the two countries’ relationship, ties are improving. Better alliance relations have, unfortunately, coincided with a deterioration in the regional and global security environment, specifically due to threats from North Korea, China, and Russia. This report examines the U.S.-ROK alliance as it adapts to the new regional context by exploring how the United States and South Korea can sustain and deepen their relationship in three vital policy areas: coordination on China, alignment in minilateral and multilateral settings, and defense technology collaboration. Perhaps the biggest shift in alliance priorities in recent years has been the growing importance of the China challenge. During Chinese Communist Party General Secretary Xi Jinping’s decade in power, Beijing has adopted a more muscular foreign policy. Both the United States and South Korea have reshaped their approaches toward China in response. ROK concerns about China have grown as Beijing shields Pyongyang and acts aggressively elsewhere in the region, including toward Taiwan. But South Korea’s approach to China will continue to differ from that of the United States. The allies have divergent preferences regarding the speed, manner, and degree of partial decoupling with China. Moreover, South Korea’s deep trade ties with China will continue to make it vulnerable to Chinese political and economic coercion.
Topic:: Security, Science and Technology, Alliance, Multilateralism, Cooperation, and Military
Political Geography:: China, Asia, South Korea, and United States of America

391. Buying Time: Logistics for a New American Way of War

Author:: Chris Dougherty
Publication Date:: 04-2023
Content Type:: Working Paper
Institution:: Center for a New American Security (CNAS)
Abstract:: Discussions about defense strategy that focus on combat units and fail to account for logistics are irrelevant when it comes to understanding how well the United States can deter or defeat aggression by China or Russia. Planes, ships, and tanks are just weapons systems; making them combat capabilities requires getting them and their crews into the fight; supplying them with fuel, food, water, medical care, and munitions; and keeping them maintained. Logistics, more than the quantity of forces or the quality of technology, will determine the potential combat power available to the United States in future conflict scenarios with China or Russia. It will influence Chinese and Russian decisions about going to war, and when, where, and how to fight. It will bound the military courses of action available to U.S. commanders and delineate the strategic options available to presidents. Despite this critical role, the Department of Defense has systemically underinvested in logistics in terms of money, mental energy, physical assets, and personnel. Neglect of logistics arguably became most severe in the post–Cold War era. Pressure to save money through efficiency and misguided attempts to run the department like a “lean” business disproportionately impacted logistics. Maximizing the ratio of combat “tooth” to logistical “tail” saved money, but at the cost of leaving U.S. armed forces with a logistical system that is stretched thin supporting peacetime operations and wholly unsuited to the demands of warfare with China or Russia. Recognizing U.S. dependence on strained logistics networks, China and Russia have developed means to attack these networks, including long-range missiles and cyberattacks. Barring changes to U.S. logistics and sustainment concepts, such attacks present a grave threat to the department’s ability to uphold U.S. security commitments in East Asia or eastern Europe.
Topic:: Security, Defense Policy, Military Strategy, and Logistics
Political Geography:: North America and United States of America

392. Charting a Transatlantic Approach to Russia: A Working Paper of the Transatlantic Forum on Russia

Author:: Andrea Kendall-Taylor
Publication Date:: 09-2023
Content Type:: Working Paper
Institution:: Center for a New American Security (CNAS)
Abstract:: Although the United States and Europe are not directly engaged in the war with Russia in Ukraine, Moscow clearly sees itself as being at war with the West. The United States and Europe, therefore, must be prepared for a period of what is likely to be prolonged confrontation with Russia, with the war for Ukraine at the center of that confrontation. Successfully navigating this period of sustained confrontation requires continued cohesion and coordination between the United States and Europe to ensure they share a common picture of the challenge that Russia poses and the necessary response. Russia’s war in Ukraine has precipitated rapid and major changes in Europe and broader ripple effects that are altering political dynamics much farther afield. Because of the war in Ukraine, Russia itself is changing in still unknowable ways. Russian President Vladimir Putin is taking the country in a more authoritarian direction, Russian society is shifting, and the Russian military’s degradation in Ukraine means that the nature of the Russian threat is evolving. Russia’s war, therefore, requires the allies to re-examine long-held assumptions and understandings about Russia and its intentions and capacity, and it is those updated assessments that should guide the transatlantic partners’ future policy approach toward Moscow. There is no going back to the way things were with Russia prior to its invasion of Ukraine. Instead, Western allies must build on ongoing efforts to constrict and constrain the Kremlin’s ability to sustain aggression in Ukraine and more broadly beyond Russia’s borders. It also will require the development of a long-term and sustainable approach to restoring peace and stability to Europe, increasing resilience to the Kremlin’s tools and tactics, and planting the seeds for a less confrontational relationship with a future Russia. In many ways, such an approach will resemble the containment strategy first set out in the 1940s, a strategy designed to apply steady and forceful counterpressure to a regime whose paranoia and insecurities represented a clear danger to the West, just as the Putin regime does today. Each of the transatlantic allies’ preferred policy approaches will reflect their own proximity to and history with Russia, as well as current political realities within their own borders. Nonetheless, there is broad consensus within the alliance that the unprecedented cohesion and coordination among allies in the wake of Russia’s invasion must hold. To that end, this working paper provides a starting point for the development of a transatlantic approach to Russia. It articulates expectations for relations with Russia that should guide the allies’ approach, outlines the broad objectives that a transatlantic Russia policy should seek to accomplish, and in some cases more specific near-term actions the allies can take. The analysis reflects two years of dialogue that CNAS has conducted through its Transatlantic Forum on Russia (TFR). It brings together and builds on previous work facilitated by the Forum, including policy papers, op-eds, articles, a Senate Foreign Relations Committee testimony, “What Comes Next for U.S. Policy Toward Russia,” and other cited publications.1 The paper aims to provide fodder for policymakers and experts on both side of the Atlantic to debate and refine through continued dialogue, including through the future work of the TFR.
Topic:: Security, Defense Policy, Transatlantic Relations, Dialogue, and Russia-Ukraine War
Political Geography:: Russia and Europe

393. The EU and CT-P/CVE in its external action

Author:: Dylan Macchiarini Crosson, Tatjana Stankovic, Pernille Rieker, and Steven Blockmans
Publication Date:: 07-2023
Content Type:: Working Paper
Institution:: Centre for European Policy Studies (CEPS)
Abstract:: This article re-frames the ongoing democracy versus security debate surrounding the European Union’s (EU) policies to counter terrorism and prevent/counter violent extremism (CT-P/CVE). Indeed, extant literature has primarily focused on how the EU’s CTP/CVE-specific emphasis on security concerns has come at the expense of attention towards good governance and social justice, thereby undermining the effectiveness of its approach. After reviewing general concepts discerned from previous research on the EU’s CT-P/CVE policy, tracing its approach over time, analysing key documents, and conducting interviews with policymakers, this analysis finds that the EU – in its words, funding, and policy implementation – also pays significant CT-P/CVE-relevant attention to the structural causes of radicalisation to violent extremism and terrorism by mobilising significant developmentoriented resources and diplomatic energy. By doing so, the EU’s CT-P/CVE policies balance an emphasis on security concerns and broader socio-economic and diplomatic engagement. However, the EU simultaneously de-emphasises good governance and peacebuilding, which must be reinforced and mainstreamed across its primary developmental engagement for the EU’s CT-P/CVE approach to be considered fully fit-for-purpose.
Topic:: Security, Terrorism, Governance, Violent Extremism, European Union, Democracy, and Peacebuilding
Political Geography:: Europe

394. One year of war in Ukraine

Author:: Christian Leffler
Publication Date:: 03-2023
Content Type:: Working Paper
Institution:: Centre for European Policy Studies (CEPS)
Abstract:: It has been just over one year since Russia began its brutal war of aggression against Ukraine. In that year, the EU has stepped up and provided copious amounts of support to Ukraine – economic and military, as well as providing a safe haven for millions of Ukrainians who have fled the fighting. As the conflict has now entered its second year, this CEPS Explainer dives deep to analyse what has defined the first year and then expands on what the EU needs to concretely do in the second if Ukraine is to have any hope of triumphing over the invaders. This will require vision, courage and boldness from European leaders. The alternative if they fail? A rules-based international order replaced by a ruthless multipolar world defined by competing spheres of influence.
Topic:: European Union, Armed Conflict, International Order, and Russia-Ukraine War
Political Geography:: Russia, Europe, and Ukraine

395. The Sunshine Problem: Climate Change and Managed Decline in the European Union

Author:: Timur Ergen and Luuk Schmitz
Publication Date:: 12-2023
Content Type:: Working Paper
Institution:: Max Planck Sciences Po Center on Coping with Instability in Market Societies (MaxPo)
Abstract:: Decarbonization requires the winding down of – economically – fully viable, if not highly prosperous, lines of economic activity. Different from past episodes of industrial restructuring revolving around the managed decline of sunset industries, accelerating climate change requires reallocation away from economic activities where the metaphorical sun is still shining. Firms, owners, workers, regions, and polities structurally rely on these sources of prosperity and have interwoven their past and future lives with them. We argue that this problem has created a space for state actors to experiment with vertical industrial policies to manage the reallocation of resources from polluting to non-polluting activities. We illustrate this dynamic by investigating the least-likely case of the European Union, a polity heavily tilted towards market governance. European climate policymakers, we argue, have incrementally moved away from the primacy of regulatory, market-making tools and have introduced a plethora of vertical instruments to shift resources away from climate-harming fields. This experimentation with vertical policies unfolds against the backdrop of a thirtyyear institutional legacy of single market-oriented policy in the energy field.
Topic:: Climate Change, Industrial Policy, European Union, Social Cohesion, and Green Transition
Political Geography:: Europe

396. A Bitter Adjustment for German Family Capitalism: Succession and a Changing Ownership Transfer Regime

Author:: Isabell Stamm and Allan Sandham
Publication Date:: 11-2023
Content Type:: Working Paper
Institution:: Max Planck Sciences Po Center on Coping with Instability in Market Societies (MaxPo)
Abstract:: Germany is known for its family-owned businesses that transfer ownership across generations. However, business owners in Germany increasingly envision selling their business beyond the family, which fundamentally changes the institutionalized way private ownership of businesses is transferred. In this paper, we analyze and explain this fundamental change in German family capitalism since the 1990s. Drawing on a sociology of ownership, we view family succession as a transfer regime and show how this regime has been problematized and gradually reframed. Based on analysis of a rich corpus of documents, archival materials, and twenty-seven expert interviews, we show how a new transfer regime – the exit regime – emerges, which coordinates ownership transfer among founders through matchmaking. Our study contributes to research on family capitalism and succession by demonstrating how family capital moves toward the financial sector without becoming financial capital as it loses the family and gains the founder as personalized points of reference.
Topic:: Regime Change, Capitalism, Family, Succession, and Ownership
Political Geography:: Europe and Germany

397. What Growth Strategies Do Citizens Want? Evidence from a New Survey

Author:: Lucio Baccaro, Bjorn Bremer, and Erik Neimanns
Publication Date:: 08-2023
Content Type:: Working Paper
Institution:: Max Planck Sciences Po Center on Coping with Instability in Market Societies (MaxPo)
Abstract:: While research on the economic characteristics of growth models across countries is now extensive, research on the politics of growth models is still in its infancy, even though governments routinely pursue different strategies to generate growth. In particular, we lack evidence on (1) whether citizens have coherent preferences towards growth strategies, (2) what growth strategies citizens prefer, and (3) what shapes their preferences. We address these questions through a new survey of public opinion in Germany, Italy, Sweden, and the United Kingdom, which exemplify different models. We find that preferences for growth strategies are consistent with other policy preferences and are meaningfully structured by class and retirement status, and to a lesser extent by sector of employment. At the same time, differences across class and sector are small, and a large majority of respondents across countries favor wage-led growth. This suggests there is a “representation gap,” since this particular growth strategy is in crisis everywhere.
Topic:: Public Opinion, Economic Growth, Representation, Macroeconomics, Comparative Capitalism, and Growth Models
Political Geography:: United Kingdom, Europe, Germany, Italy, and Sweden

398. Paradigm Shifts in Macrosociology

Author:: Renate Mayntz
Publication Date:: 06-2023
Content Type:: Working Paper
Institution:: Max Planck Sciences Po Center on Coping with Instability in Market Societies (MaxPo)
Abstract:: This paper looks at changes in macrosociological paradigms for social development that traditionally stretch from the primitive society through the stratified medieval society to the image of a functionally differentiated modern society. Changing the perspective from a systems theoretical view of societies to an actor perspective, I focus on populations of individual actors and organizations as collective actors. Over recent decades, important structural changes in the nature of populations and of organizations have taken place in the Western world. The most important relate to economic globalization and financial internationalization. An increasingly flexible population and narrowly goal-specific organizations produce a situation of societal instability that appears to characterize the present, though its causes reach back half a century.
Topic:: Development, Conflict, Integration, and Financial Globalization
Political Geography:: Global Focus

399. Turning No Tides: Union Effects on Partisan Preferences and the Working-Class Metamorphosis

Author:: Sinisa Hadziabdic
Publication Date:: 05-2023
Content Type:: Working Paper
Institution:: Max Planck Sciences Po Center on Coping with Instability in Market Societies (MaxPo)
Abstract:: Relying on panel data for Germany, Switzerland, the United Kingdom, and the United States, the paper examines the impact of union membership on partisan preferences. By leveraging panel data to control for time-invariant selection effects, we show that unions exert a small consistent left‑wing influence on the average wage earner who becomes affiliated, but they are no longer able to modify the preferences of working-class members. A longitudinal approach reveals that changes in partisan preferences can be linked to members’ preexisting predispositions and to the prevalent political views within unions. Unions mainly attract individuals who already share their political inclinations before joining. These preexisting left-wing convictions allow an additional left-wing shift to take place through a value congruence mechanism provoked by interactions with long-term union members who are even more left-wing oriented than the newcomers. Symmetrically, working-class joiners exhibit less pronounced left-wing inclinations before becoming affiliated, a gap that widens further after they join as a consequence of their unmet expectations.
Topic:: Politics, Class, Political Parties, Data, and Trade Unions
Political Geography:: Europe and North America

400. Top Wealth and Its Historical Origins: An Analysis of Germany’s Largest Privately Held Fortunes in 2019

Author:: Daria Tisch and Emma Ischinsky
Publication Date:: 04-2023
Content Type:: Working Paper
Institution:: Max Planck Sciences Po Center on Coping with Instability in Market Societies (MaxPo)
Abstract:: Rising wealth inequality is both a topic in recent policy discussion and in the social sciences. Despite the general interest in wealth concentration, we know only little about the largest privately held fortunes. To help fill this gap we analyze the historical origins of Germany’s 1,032 largest fortunes in 2019. In particular, we identify the share of entrenched fortunes – fortunes which date back to the beginning of the twentieth century – and ask to what extent they differ from more recently established ones. Furthermore, we examine in an exploratory way if entrenched fortunes are connected to fortunes with more recent origins through family lines. We use a journalistic rich list published by the manager magazin in 2019, which we link with both rich lists from 1912/1914 and Wikidata. We find that about eight percent of today’s fortunes can be traced back to fortunes held by the same families in 1913. Regression analyses show that entrenched fortunes rank on average higher on the rich list than the remaining ones. Descriptive network analyses indicate that some of today’s largest fortunes are intertwined through marital lines, hinting at social closure at the top. Our findings indicate that the accumulation and perpetuation of fortunes over many generations is an important feature of top wealth in Germany.
Topic:: Inequality, Family, Elites, Wealth, Inheritance, and Network Analysis
Political Geography:: Europe and Global Focus

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COLUMBIA UNIVERSITY PRESS