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3101. Disorderly adjustments to exchange rate misalignments: The experience of Korea'

Author:
Takuji Kinkyo
Publication Date:
08-2004
Content Type:
Working Paper
Institution:
School of Oriental and African Studies - University of London
Abstract:
This paper analyzes Korea's exchange rate dynamics before and during the crisis of 1997-98 by estimating the long-run fundamental exchange rate and the associated error correction model. The analysis suggests that although Korea's exchange rate was substantially overvalued before the crisis, the subsequent exchange rate dynamics could not fully be accounted by the need to correct misalignments. It was found that there was a large deviation from the short-run fundamental value of exchange rates, indicating the presence of “overshooting of the overshooting equilibrium” during the crisis. The findings have important policy implications for crisis management in emerging market economies.
Topic:
International Relations, Development, Economics, and International Political Economy
Political Geography:
Korea

3102. Transmission channels of capital flow shocks: why Korean crisis was so severe'

Author:
Takuji Kinkyo
Publication Date:
08-2004
Content Type:
Working Paper
Institution:
School of Oriental and African Studies - University of London
Abstract:
The Asian crisis highlighted the vulnerability of emerging market economies faced by sudden capital flow reversals. An important question that has critical implications for crisis management is how negative shocks in capital inflows were transmitted to economic activities, transforming financial instability into fully-fledged crises. Using VARs, this paper analyzes the transmission mechanism of capital flow shocks during the Korean crisis of 1997-98. Although it is commonly believed that severe economic contractions were caused by credit crunch, the analysis suggests that the major constraint for production was a steep rise in prices of imported inputs due to sharp exchange rate depreciations.
Topic:
International Relations, Development, Economics, and International Political Economy
Political Geography:
Asia and Korea

3103. Does South Africa Suffer from the Fear of Float' Syndrome?An Analysis of the Efficacy and Challenges of a Managed Floating Exchange Rate Regime with Financial Integration'

Author:
Olano Makhubela
Publication Date:
07-2004
Content Type:
Working Paper
Institution:
School of Oriental and African Studies - University of London
Abstract:
The paper examines whether South Africa suffers from a 'fear of float' syndrome. The analysis also covers the efficacy and challenges of a managed floating exchange rate regime. I use time series data, volatility equations and ARCH models to test the volatility of South Africa's exchange rate, interest rate and foreign exchange reserves. Evidence shows that South Africa has volatile interest and exchange rates, but not foreign exchange reserves. Yet, South Africa does not seem to suffer from an extreme and chronic form of 'fear of floating'. South Africa requires financial integration to finance its current account deficits and to complement its low savings rate. Yet, evidence indicates that both capital account openness and foreign exchange control liberalization have no robust impact on growth. The authorities' intervention in the 2001 currency crisis did not help. Hence, I recommend that South Africa should use interest rates early to target both inflation and foreign exchange rates. Challenges remain in the form of relatively high interest rates, volatile capital flows, perceptions, destabilizing speculation, and loopholes in foreign exchange controls.
Topic:
International Relations, Development, Economics, and International Political Economy
Political Geography:
South Africa

3104. Globalisation and Comparative Economics: Of Efficiency, Efficient Institutions, and Late Development'

Author:
Dic Lo
Publication Date:
06-2004
Content Type:
Working Paper
Institution:
School of Oriental and African Studies - University of London
Abstract:
Does globalisation entail a demand for uniformity, or diversity, of the (political) economic institutions of nation-states? What is the theoretical underpinning of the demand? And what are the implications of the demand for economic development? The conventional literature known as comparative economic systems has been unable to answer these question, because there is an intrinsic tension between its methodology (the neoclassical framework of individualistic rational choices and their equilibrium) and the subject matter (the multiplicity of economic institutions and development experiences in the real world). The new comparative economics has consisted of a variety of attempts to cope with this tension: some aimed at preserving the neoclassical framework at a m o re fundamental level, while some others aim e d at transcending the framework to arrive at a new theory of economic system s and development. This paper argues that attempts that adhere to the neoclassical tradition is likely to lead to dead ends, while attempts that encompass collective as well as individualistic rationality represent m o re promising directions. Fuller developments of the literature, however, require incorporating objectified institutions and paradigmised technology in to its sphere of inquiry. It is submitted that there are important lessons to learn from classical political economy and their modern presentations, particularly Marxian theories of the social forces of production, in this regard.
Topic:
International Relations, Development, Economics, and International Political Economy

3105. Household water and sanitation services in Saudi Arabia: an analysis of economic, political and ecological issues'

Author:
Elie Elhadj
Publication Date:
05-2004
Content Type:
Working Paper
Institution:
School of Oriental and African Studies - University of London
Abstract:
This study evaluates Saudi Arabia's investment in household water and sanitation services (WSS) over the past three decades or so. It finds that over one half of Saudi householders still have no municipal water connections and two thirds are without sanitation connections. Saudi cities have no rain water drainage system s to deal with the brief and occasional, but severe deluges of winters. Desalinated water is transmitted across hundreds of kilometers of desert terrain to two major urban centers (Riyadh and Qaseem) that are rich in groundwater reserves while their local water is used in irrigation.
Topic:
International Relations, Development, Environment, and International Political Economy
Political Geography:
Saudi Arabia

3106. Camels don't fly, deserts don't bloom: an assessment of Saudi Arabia's experiment in desert agriculture'

Author:
Elie Elhadj
Publication Date:
05-2004
Content Type:
Working Paper
Institution:
School of Oriental and African Studies - University of London
Abstract:
Severe arid conditions constrained agricultural production and population size in the Arabian Peninsula over the millennia (except around oases and in parts of Yemen). An abrupt change in Saudi Arabia started in the 1980s to make the desert bloom. This study examines whether or not the Saudi experiment in desert irrigation has been worthwhile in terms of cost and benefit. It concludes that the project was a waste of money and water on a grand scale.
Topic:
International Relations, Development, Environment, and International Political Economy
Political Geography:
Yemen, Saudi Arabia, and Sinai Peninsula

3107. The household water crisis in Syria's Greater Damascus Region'

Author:
Elie Elhadj
Publication Date:
05-2004
Content Type:
Working Paper
Institution:
School of Oriental and African Studies - University of London
Abstract:
Damascus residents talk in recent years of long periods of daily water shut-offs for most months especially between June and the following January. “ In 2001 … stringent water rationing was in force in Damascus… the authorities … shut off the capital's piped water supply for 20 hours each day (compared with 16 hours previously) from July of that year. Europa Publications (2002: p.979).”
Topic:
International Relations, Development, Environment, and Human Welfare
Political Geography:
Europe and Syria

3108. Compensating Differentials and the Queue For Public Sector Jobs: Evidence from Egyptian Household Survey Data'

Author:
Mona Said
Publication Date:
03-2004
Content Type:
Working Paper
Institution:
School of Oriental and African Studies - University of London
Abstract:
This Paper considers the determinants of male and female pay in the public and private sectors by estimating a joint model of sector allocation and wage determination using cross-sectional data from the Egyptian 1987 and 1997 labour force surveys. The results points to the profound impact of the graduate public sector employment guarantee on labour market segmentation in Egypt. In particular, the level of educational attainment became the most important factor in sorting workers between sectors. Comparison of the 1987 and 1997 results highlight that the strong impact of the public sector employment guarantee on the labour market in the 1980s was weakened in the 1990s for males but remains important for females. Moreover, risk-averse individuals (proxied by those who have greater financial responsibility in their households) have a greater probability of choosing public sector than private sector employment. These results are consistent with the effective operation of the guarantee for more highly educated workers and with time based queuing for guaranteed positions. A model of compensating wage differentials is then defined and estimated, in order to quantify the value of arguably the three most important non-pecuniary aspects of public sector employment: job security, fringe benefits (especially comprehensive retirement pensions) and lower effort and shorter hours which allow workers to supplement income through obtaining a second job. Estimates of the publicprivate differentials, correcting for differences in characteristics and selectivity, indicate a public sector disadvantage for males and a small advantage for females in 1987. Relative public sector wages improved for both males and females in 1997, and when adjustments for non-wage benefits are included, public sector premia are observed in all segments of the public sector for both males and females. It also emerged that the single most important adjustment factor leading to the change in the differential is the value of job stability, which drives up the differential in favour of the public sector, particularly in manufacturing. The results highlight the importance of job security as the major factor determining the persistence of queues for public sector jobs in Egypt.
Topic:
International Relations, Development, Economics, and International Political Economy
Political Geography:
Egypt

3109. Assessing the Role of Foreign Direct Investment in China's Economic Development: Macro Indicators and Insights from Sectoral-Regional Analyses'

Author:
Dic Lo
Publication Date:
01-2004
Content Type:
Working Paper
Institution:
School of Oriental and African Studies - University of London
Abstract:
The objective of this paper is to assess the role of FDI in China's economic development with reference to the broader literature on FDI and late development. Three main findings come out from the analyses in the paper. First, it is found that FDI tends to promote the improvement in allocative efficiency, while having a negative impact on productive efficiency. Second, insofar as FDI does promote overall productivity growth, this tends to be a matter of cumulative causation rather than one of single-direction causation. Third, in the context of a comparative analysis of two distinctive regional models, it is found that the economic impact of FDI tends to be more favourable in the inward-looking, capital-deepening pattern of development (the 'Shanghai model') than that in the export-oriented, labour-intensive pattern (the 'Guangdong model'). Further analyses, however, suggest that the 'Shanghai model' has its intrinsic problems of sustainability. The scope for applying it to China as a whole is thus judged to be limited.
Topic:
International Relations, Development, and International Political Economy
Political Geography:
China and Shanghai

3110. Global Best Practices: Judicial Councils: Lessons Learned from Europe and Latin America

Author:
Sandra Elena and Violaine Autheman
Publication Date:
04-2004
Content Type:
Working Paper
Institution:
Academy of Political Science
Abstract:
International and regional human rights treaties recognize the right to a fair trial by an independent tribunal in the determination of rights and obligations in civil, commercial and administrative matters and in the determination of criminal charges. The right to a fair trial and its core components, including the “reasonable time” requirement and the principle of judicial independence, is now universally accepted. Building upon the declarations of principle of legally binding conventions, international and regional expert guidelines and principles have aimed at fleshing out the specific elements of judicial independence. In addition, international and regional human rights courts and commissions have interpreted the provisions of human rights treaties and shed some light on the minimum standards and components of the right to a fair trial and judicial independence.
Topic:
International Relations, Human Rights, and International Law
Political Geography:
Europe and Latin America

3111. Global Best Practices: Constitutional Courts, Judicial Independance and the Rule of Law

Author:
Sandra Elena and Procop Buruiana
Publication Date:
04-2004
Content Type:
Working Paper
Institution:
Academy of Political Science
Abstract:
This paper is a cursory survey of the global landscape of Constitutional Courts and Tribunals with constitutional review powers from the perspective of international, regional and national principles on judicial independence and accountability, integrity and democratic development. In many transition and developing countries, academics, legal practitioners, human rights groups and others believe that this relatively new democratic institution has played a positive role in promoting a Rule of Law culture. Clearly, this is a potentially strong democratic institution that needs more attention and support from donors, civil society and national government.
Topic:
International Relations, Civil Society, International Law, and Regional Cooperation

3112. Global Best Practices: Income and Asset Disclosure Requirement for Judges: Lessons Learned from Eastern Europe and Latin America

Author:
Keith Henderson, Sandra Elena, and Procop Buruiana
Publication Date:
04-2004
Content Type:
Working Paper
Institution:
Academy of Political Science
Abstract:
In recent years, countries around the world have signed on to various governmental and non- governmental international and regional instruments designed to fight corruption at all levels of the State. Income and asset disclosure laws and policies have emerged as important mechanisms to promote probity and accountability in the fight against corruption. While these requirements were first imposed on the executive branch, they now are accepted as applying to members of the legislative and judicial branches as well. Income and asset disclosure, if properly designed and effectively applied, can also be an invaluable tool to strengthen judicial accountability, judicial independence and public trust in the judiciary and the Rule of Law. This paper provides a comparative overview of financial transparency for judges by testing the legal framework and practice in six Eastern European and Latin American countries against a set of core international best practices that have recently emerged.
Topic:
International Relations and Regional Cooperation
Political Geography:
Eastern Europe, South America, and Latin America

3113. Regional Best Practices: Enforcement of Court Judgements: Lessons Learned from Latin America

Author:
Keith Henderson, Sandra Elena, Violaine Autheman, and Angana Shah
Publication Date:
04-2004
Content Type:
Working Paper
Institution:
Academy of Political Science
Abstract:
Only recently has a general global consensus emerged among development specialists that the successful, fair and effective enforcement of court judgments, both those against private parties in commercial transactions as well as those against State agencies or officials, is of critical importance to developing a Rule of Law culture and judicial independence. There is also a growing body of international jurisprudence that requires countries, under their international and regional human rights treaty obligations, as well as their own constitution, to enforce court judgments fairly and effectively and to support the independence of the judiciary. Likewise, court decisions in various countries are also beginning to articulate and enforce these closely related legal rights.
Topic:
International Relations, International Law, and Regional Cooperation
Political Geography:
South America and Latin America

3114. Political Finance Regulation in Guatemala: A Comparative Survey

Author:
Kevin Casas-Zamora
Publication Date:
01-2004
Content Type:
Working Paper
Institution:
Academy of Political Science
Abstract:
As in most Latin American countries, the funding of political activities has only recently become a matter of serious concern in Guatemala. Long known for its chronic political instability, the country has limited experience in the observance of basic democratic practices such as regular and reasonably free and fair elections. Even today, the regulation of political finance remains under the shadow of other pressing and as yet unresolved political issues such as the extraordinary weakness of parties, the consistently high abstention rates and the practical disenfranchisement of the indigenous majority.
Topic:
International Relations, International Trade and Finance, and Political Economy
Political Geography:
South America, Latin America, and Guatemala

3115. Ensuring Equal Rights in the Elections Process

Author:
Marcin Walecki
Publication Date:
01-2004
Content Type:
Working Paper
Institution:
Academy of Political Science
Abstract:
The collapse of the Soviet Union marked a fourth wave of regime change – to democracy and autocracy. The only certain outcome of this transition is the abandonment of Communism, and not, as expected, the ultimate establishment of the liberal democracy. Most of the post-Communist states are still hybrids, mixed polities or consolidated autocracies - only some can be classified as consolidated democracies.
Topic:
International Relations, Communism, and Democratization
Political Geography:
Russia

3116. Making States Work: From State Failure to State-Building

Author:
Michael Ignatieff, Ramesh Thakur, and Simon Chesterman
Publication Date:
07-2004
Content Type:
Working Paper
Institution:
International Peace Institute
Abstract:
It is frequently assumed that the collapse of state structures, whether through defeat by an external power or as a result of internal chaos, leads to a vacuum of political power. This is rarely the case. The mechanisms through which political power are exercised may be less formalized or consistent, but basic questions of how best to ensure the physical and economic security of oneself and one's dependants do not simply disappear when the institutions of the state break down. Non-state actors in such situations may exercise varying degrees of political power over local populations, at times providing basic social services from education to medical care. Even where non-state actors exist as parasites on local populations, political life goes on.
Topic:
International Relations, Development, Economics, and Peace Studies

3117. Peacebuilding as the Link between Security and Development: Is the Window of Opportunity Closing?

Author:
Necla Tschirgi
Publication Date:
01-2004
Content Type:
Working Paper
Institution:
International Peace Institute
Abstract:
Since the end of the Cold War, it has become commonplace to assert that peace and development are intimately linked and that the United Nations (UN) and other international actors need to address the twin imperatives for security and development through integrated policies and programs. Shedding its early definition as “post-conflict reconstruction,” the term “peacebuilding” has broadened its scope in the 1990s to encompass the overlapping agendas for peace and development in support of conflict prevention, conflict management and post-conflict reconstruction.
Topic:
International Relations, Security, Peace Studies, and United Nations

3118. (Re)Writing the "National Security State"

Author:
David Grondin
Publication Date:
12-2004
Content Type:
Working Paper
Institution:
The Raoul Dandurand Chair of Strategic and Diplomatic Studies, Université du Québec à Montréal
Abstract:
Hans Morgenthau once said that “the intellectual lives in a world that is both separate from and potentially intertwined with that of the politician. The two worlds are separate because they are oriented towards different ultimate values… truth threatens power, and power threatens truth” (Morgenthau, quoted in Hill and Beshoff, 1994: xi). For Christopher Hill and Pamela Beshoff, this means that, as international relations practitioners and theorists, “Like it or not, we are 'intellectuals in politics' and 'the study of international relations is not an innocent profession'”
Topic:
International Relations, Development, Diplomacy, and National Security

3119. Abusing History: A Critical Analysis of Mainstream International Relations Theory Misconduct

Author:
Anne Marie D'Aoust
Publication Date:
12-2004
Content Type:
Working Paper
Institution:
The Raoul Dandurand Chair of Strategic and Diplomatic Studies, Université du Québec à Montréal
Abstract:
In Political Science, the discipline of IR has been widely regarded as an “American Science” ever since Stanley Hoffman published his renowned essay in 1977. This “American Science” is mainly dominated by a single theoretical approach – that of Neorealism – which relies primarily on the concept of historical recurrence to ground its arguments. Other “new” theoretical approaches which challenge this parochialism, namely feminism, constructivism and Critical Theory, remain outside the “official boundaries” of the field. These boundaries are largely set by the Neorealist agenda and its variations, which rarely diverge from an unquestioned central rationalist-empiricist theme. Thus, with respect to its methodological and epistemological stance, Neorealist theory implicitly views History as a vast field of objective data and primary sources ready to reveal their truth to the social scientist. To test and/or prove the validity of Neorealist theory in the field of International Relations, one must refer to historical data and confront theory with “straight facts”. What I propose to do here is to analyze the ways in which the Neorealist approach to International Relations makes use of history, and subsequently to consider some crucial epistomological and theoretical debates in the field of History that are ignored by Neorealists like Waltz.
Topic:
International Relations, Development, Government, and Politics
Political Geography:
America

3120. Are We Headed for a "Cyber-9/11?": The American Failure in Cyberstrategy

Author:
Benoit Gagnon
Publication Date:
12-2004
Content Type:
Working Paper
Institution:
The Raoul Dandurand Chair of Strategic and Diplomatic Studies, Université du Québec à Montréal
Abstract:
In the wake of September 11, the U.S. Superpower once again became a target. This time, the attack was carried out by means of the Internet. How effective is American cyberstrategy? Examining the hacking scene in the last couple of years, it is clear that it is not an adequate response to present – and future – cyberthreats. Therefore, it is fair to say that the United States has a national security problem rather than a cybersecurity problem and to conclude that as things stand at present the American government is steering the United States toward a cyber-9/11.
Topic:
International Relations, Science and Technology, and Terrorism
Political Geography:
United States and America

3121. International Diversification at Home and Abroad

Author:
Fang Cai and Francis E. Warnock
Publication Date:
12-2004
Content Type:
Working Paper
Institution:
Board of Governors of the Federal Reserve System
Abstract:
We analyze foreigners' and domestic institutional investors' positions in U.S. equities. Controlling for many factors, we uncover a common preference for large firms and firms that are diversified internationally. The domestic preference for internationally diversified firms implies that investors might obtain substantial international diversification by investing at home. Using an international factor model, we show that exposure to foreign equity markets is indeed greater for domestic firms that are more diversified internationally, suggesting that at least some of the home-grown foreign exposure translates into international diversification benefits. After accounting for home-grown foreign exposure, the share of 'foreign' equities in investors' portfolios nearly doubles, reducing (but not eliminating) the observed home bias.
Topic:
International Relations, Development, Economics, and International Trade and Finance
Political Geography:
United States

3122. The Performance of International Portfolios

Author:
Francis E. Warnock, Charles P. Thomas, and Jon Wongswan
Publication Date:
08-2004
Content Type:
Working Paper
Institution:
Board of Governors of the Federal Reserve System
Abstract:
This paper evaluates the performance of U.S. investors' portfolios in the equities of over 40 countries over a 25-year period. We find that these portfolios achieved a significantly higher Sharpe ratio than foreign benchmarks, especially since 1990. We uncover three potential reasons for this success. First, U.S. investors abstained from momentum trading and instead sold past winners. Second, conditional performance tests provide no evidence that the superior (unconditional) performance owed to private information, suggesting that the successful exploitation of publicly available information played a role. Third, the documented preference for cross-listed and well-governed foreign firms appears to have served U.S. investors well. We conclude with a short discussion of the implications of our findings for the home bias literature.
Topic:
International Relations, Economics, and International Trade and Finance
Political Geography:
United States

3123. The Proliferation Security Initiative

Publication Date:
06-2004
Content Type:
Working Paper
Institution:
Board of Governors of the Federal Reserve System
Abstract:
The Proliferation Security Initiative (PSI) is a global initiative aimed at stopping shipments of weapons of mass destruction (WMD), their delivery systems, and related materials worldwide, announced by President Bush, May 31, 2003. It stems from the National Strategy to Combat Weapons of Mass Destruction issued in December 2002. That strategy recognizes the need for more robust tools to defeat the proliferation of WMD around the world, and specifically identifies interdiction as an area where greater focus will be placed.
Topic:
Conflict Prevention, International Relations, Arms Control and Proliferation, and Weapons of Mass Destruction

3124. Ramsey Monetary Policy and International Relative Prices

Author:
Ester Faia and Tommaso Monacelli
Publication Date:
04-2004
Content Type:
Working Paper
Institution:
Board of Governors of the Federal Reserve System
Abstract:
We analyze welfare maximizing monetary policy in a dynamic two-country model with price stickiness and imperfect competition. In this context, a typical terms of trade externality affects policy interaction between independent monetary authorities. Unlike the existing literature, we remain consistent to a public finance approach by an explicit consideration of all the distortions that are relevant to the Ramsey planner. This strategy entails two main advantages. First, it allows an accurate characterization of optimal policy in an economy that evolves around a steady-state which is not necessarily efficient. Second, it allows to describe a full range of alternative dynamic equilibria when price setters in both countries are completely forward looking and households' preferences are not restricted. In this context, we study optimal policy both in the long-run and along a dynamic path, and we compare optimal commitment policy under Nash competition and under cooperation. By deriving a second order accurate solution to the policy functions, we also characterize the welfare gains from international policy cooperation.
Topic:
International Relations, Economics, and International Trade and Finance
Political Geography:
United States

3125. Indeterminacy with Inflation-Forecast-Based Rules in a Two-Bloc Model

Author:
Nicoletta Batini, Paul Levine, and Joseph Pearlman
Publication Date:
04-2004
Content Type:
Working Paper
Institution:
Board of Governors of the Federal Reserve System
Abstract:
We examine the performance of forward-looking inflation-forecast-based rules in open economies. In a New Keynesian two-bloc model, a methodology first employed by Batini and Pearlman (2002) is used to obtain analytically the feedback parameters/horizon pairs associated with unique and stable equi-libria. Three key findings emerge: first, indeterminacy occurs for any value of the feedback parameter on inflation if the forecast horizon lies too far into the future. Second, the problem of indeterminacy is intrinsically more serious in the open economy. Third, the problem is compounded further in the open economy when central banks respond to expected consumer, rather than pro-ducer price inflation.
Topic:
International Relations, Economics, and International Trade and Finance
Political Geography:
United States

3126. Sand in the Wheels of the Labor Market: The Effect of Firing Costs on Employment

Author:
Andrea De Michelis
Publication Date:
04-2004
Content Type:
Working Paper
Institution:
Board of Governors of the Federal Reserve System
Abstract:
This paper examines the effects of firing costs in a dynamic general equilibrium model where firms face stochastic demand. It derives analytically two simple closed-form equations, one for the supply of labor, the other for its demand. These equations determine the comparative static effects of changes in firing costs on the labor market. When negative shocks are more likely to occur than positive shocks, and when the frequency of these shocks is high, firing costs have a substantial negative impact on aggregate employment. In addition, product market integration, as it has occurred in the formation of the European Union, induces firms to be more wary of future possible downturns and therefore intensifies the negative consequences of firing costs.
Topic:
International Relations, Economics, and International Trade and Finance

3127. Price-level Determinacy, Lower Bounds on the Nominal Interest Rate, and Liquidity Traps

Author:
Dale W. Henderson and Ragna Alstadheim
Publication Date:
04-2004
Content Type:
Working Paper
Institution:
Board of Governors of the Federal Reserve System
Abstract:
We consider monetary-policy rules with inflation-rate targets and interest-rate or money-growth instruments using a flexible-price, perfect-foresight model. There is always a locally-unique target equilibrium. There may also be below-target equilibria (BTE) with inflation always below target and constant, asymptotically approaching or eventually reaching a below-target value, or oscillating. Liquidity traps are neither necessary nor sufficient for BTE which can arise if monetary policy keeps the interest rate above a lower bound. We construct monetary rules that preclude BTE when fiscal policy does not. Plausible fiscal policies preclude BTE for any monetary policy; those policies exclude surpluses and, possibly, balanced budgets.
Topic:
International Relations, Economics, and International Trade and Finance
Political Geography:
United States

3128. Report of the Defense Science Board Task Force on Future Strategic Strike Forces

Publication Date:
02-2004
Content Type:
Working Paper
Institution:
Board of Governors of the Federal Reserve System
Abstract:
The Defense Science Board Summer Study Task Force on Future Strategic Strike Forces looks to the 30-year future with the objective of providing the President with a broad range of strike options to Protect the United States and our forces abroad, Assure friends and allies of our future commitment, and Deal with future adversaries on terms favorable to the United States. The Task Force identified currently planned systems that will still be relevant and recommended new systems for development.
Topic:
International Relations and Defense Policy
Political Geography:
United States

3129. Cash Flows and Discount Rates, Industry and Country Effects, and Co-Movement in Stock Returns

Author:
John Ammer and Jon Wongswan
Publication Date:
09-2004
Content Type:
Working Paper
Institution:
Board of Governors of the Federal Reserve System
Abstract:
This paper examines the relative importance of global, country-specific, and industry-specific factors in both the cash flow and discount rate components of equity returns between 1995 and 2003. Our framework draws upon previously separate literatures on country versus industry effects and (forward-looking) cash flow versus discount rate components of equity return innovations. We apply the Campbell (1991) decomposition for industry-by-country, all-country, global industry, and world market index returns so we can produce a richer characterization of same-industry and same-country effects in stock returns. Unlike previous equity return decomposition papers, we exploit information in equity analysts' earnings forecasts when projecting future variables from our reduced-form equation systems. Our findings confirm previous research that finds patterns of correlation that suggest a richer underlying structure than just a single common global factor. Furthermore, our results suggest that global, within-country, and same-industry effects are all important for both of the two key components of stock returns: news about future dividends and news about future discount rates. In particular, within-industry covariation in news about future discount rates appears to be just as important as within-country covariation in news about future discount rates. We also find that the idiosyncratic component of cash flow news is more important than the global component, while the reverse is true for news about future discount rates. Our results are broadly consistent with co-movement in future discount rates arising from perceptions of common elements of risk, rather than national market segmentation.
Topic:
International Relations, Economics, Industrial Policy, and International Trade and Finance

3130. US-Mexico Border Control in a Changing Economic and Security Context

Author:
Peter Andreas
Publication Date:
12-2004
Content Type:
Working Paper
Institution:
The Wilson Center
Abstract:
Although far from Washington and Mexico City, it is perhaps only a slight exaggeration to say that U.S.-Mexico relations begin and end at their shared 1,933-mile-long border. Indeed, the degree of harmony or conflict in the relationship increasingly depends on how the border and border control matters are politically managed. The border is both one of the busiest and one of the most heavily policed territorial lines in the world, where many of the most critical and sensitive issues in the bilateral relationship, such as trade, migration, and drug trafficking, come together. In fact, much of U.S. policy toward Mexico has been driven by the twin objectives of facilitating authorized border crossings and deterring unauthorized crossings. Balancing these tasks has always been politically and bureaucratically frustrating and cumbersome, but both the challenge and the stakes have grown substantially as counterterrorism has been added to and redefined the border control agenda since September 11, 2001.
Topic:
International Relations, Security, and Economics
Political Geography:
United States, Washington, and Mexico

3131. Moving Toward Dialogue: Challenges in Canada - U.S. Energy Trade

Author:
Paul Ziff and Daniel Yergin
Publication Date:
09-2004
Content Type:
Working Paper
Institution:
The Wilson Center
Abstract:
Moving Toward Dialogue: Challenges in Canada-U.S. Energy Trade is the second publication in our new One Issue,Two Voices series. Using expertise from both sides of the Canada–U.S. border, this series is our contribution to dialogue on policy issues relevant to the bilateral relationship. We look at energy in this paper, specifically the issue of infrastructure and cooperation in the delivery of energy resources across the 49th parallel. Our authors, Daniel Yergin and Michael Zenker of Cambridge Energy Research Associates (Cambridge and Washington) and Paul Ziff of Ziff Energy Group (Calgary) are wellknown experts on energy issues who have agreed to share their opinions on this important aspect of the energy trade.
Topic:
International Relations, Energy Policy, and Treaties and Agreements
Political Geography:
North America

3132. Decision Time: Water Diversion Policy in the Great Lakes Basin

Author:
Ralph Pentland and Jim Olson
Publication Date:
09-2004
Content Type:
Working Paper
Institution:
The Wilson Center
Abstract:
Decision Time:Water Diversion Policy in the Great Lakes is the first publication in our One Issue,Two Voices series. Using expertise from both sides of the Canada–U.S. border, this series is our contribution to dialogue on policy issues relevant to the bilateral relationship. In this first paper, the issue is “water,” specifically the developing policy on diversions from the Great Lakes. Our two authors are leading experts on the Great Lakes, who have willingly entered the debate to share their informed opinions.
Topic:
International Relations, Regional Cooperation, and Treaties and Agreements
Political Geography:
North America

3133. Collision Avoidance: U.S.-Russian Bilateral Relations and Former Soviet States

Author:
Eugene B. Rumer
Publication Date:
04-2004
Content Type:
Working Paper
Abstract:
The year 2003 was a difficult one in U.S.- Russian relations, and 2004 promises to be even more challenging. Disagreements between Washington and Moscow over Iraq were the most visible in a series of events that also included American concerns about Chechnya, the authoritarian tilt in Russian domestic politics, Russia's fading media freedom, selective prosecution of independent-minded businessmen, and meddling in the internal affairs of its neighbors. Together, these events add up to a trend that spells trouble for the ambitious U.S.-Russian strategic framework inaugurated by President George W. Bush and President Vladimir Putin in 2002. Yet rarely if ever has the need for greater cooperation between the two countries been more urgent than it will be in 2004 and the years to come.
Topic:
International Relations and Security
Political Geography:
Russia, United States, Washington, Soviet Union, and Moscow

3134. China Brief, Energy Concerns and China's Unresolved Territorial Disputes

Author:
Matthew Oresman, Drew Thompson, John C.k. Daly, and Harvey Stockwin
Publication Date:
12-2004
Content Type:
Policy Brief
Institution:
The Jamestown Foundation
Abstract:
While much of the world is fixated on China's booming economic growth and its ravenous appetite for energy, untidy diplomatic loose ends in the form of territorial disputes with neighbors have many of the countries bordering the Asian giant nervous. Though Beijing's claims over Taiwan remain the focus of world attention, China is embroiled in unresolved territorial maritime and land issues with no less than thirteen of its neighbors. Given that China's military capability is growing apace with its economy, the potential for military conflict over the disputed regions is similarly on the rise. While China up to now has attempted to address these issues diplomatically, the fact that many of the unresolved border disputes involve potential energy reserves might prompt China to use military force to resolve issues of strategic economic interest.
Topic:
International Relations, Government, and Political Economy
Political Geography:
China, Israel, Taiwan, Beijing, and Asia

3135. China Brief, Beijing's North Korean Gambit

Author:
Willy Lam, Lionel Martin, John Tkacik, and Toby Lincoln
Publication Date:
10-2004
Content Type:
Policy Brief
Institution:
The Jamestown Foundation
Abstract:
Beijing is flashing the North Korean (DPRK) card at a time when the Chinese Communist Party (CCP) leadership feels increasingly threatened by an anti-China “containment policy” that Washington is supposedly spearheading with the help of Japan, Taiwan and other Asian countries and regions.
Topic:
International Relations, Government, and Political Economy
Political Geography:
Japan, China, Washington, Israel, Taiwan, Beijing, Asia, and North Korea

3136. China Brief, China's Quest for Energy Security

Author:
Wenran Jiang, Willy Lam, Dennis J. Blasko, and Eric Teo
Publication Date:
10-2004
Content Type:
Policy Brief
Institution:
The Jamestown Foundation
Abstract:
The year is 2008. The setting is the vast West Pacific region. To break the US-Japan- Taiwan military containment of China, the combined air, navy and armed forces of the Chinese Liberation Army (PLA), equipped with newly established carrier battle groups, have destroyed all U.S. military bases in the region, taken control of all strategic sea routes from the Strait of Malacca to the Persian Gulf, and imposed an oil embargo to choke the U.S., Japan, Taiwan and their allies.
Topic:
International Relations, Government, and Political Economy
Political Geography:
Japan, China, Israel, and Taiwan

3137. China Brief, Hu Jintao's Move to Consolidate Power

Author:
Eugene Kogan, Willy Lam, Drew Thompson, Dennis J. Blasko, and Zhu Feng
Publication Date:
09-2004
Content Type:
Policy Brief
Institution:
The Jamestown Foundation
Abstract:
President and Central Military Commission (CMC) Chairman Hu Jintao has moved swiftly to tighten his grip over the People's Liberation Army (PLA). The emphasis that the new commander-in-chief has put on flexing the nation's fast-growing military muscle has fed speculation that he will be taking a more hard-line stance on relations with the U.S. and with Taiwan. However, it is unlikely that the predominant Hu-Wen Faction – a reference to the leadership team under Hu and Premier Wen Jiabao – will unveil too many major initiatives until it has consolidated its control over the Chinese Communist Party (CCP), the government and the army.
Topic:
International Relations, Government, and Political Economy
Political Geography:
United States, China, Israel, and Taiwan

3138. China Brief, Hong Kong's LegCo Elections: Overcoming the System

Author:
Christine Loh, Willy Lam, Eric Teo, and Zhenzhen Chen
Publication Date:
09-2004
Content Type:
Policy Brief
Institution:
The Jamestown Foundation
Abstract:
The 1.784 million voters that participated in Hong Kong's 2004 Legislative Council Election gave a clear signal that they want democracy sooner rather than later. Whereas until now Hong Kongers have only been able to select the opposition, the recent elections indicated the people's desire to elect their city government. However, herein lies the uniqueness of Hong Kong's political system. Despite the city's many achievements in education standards, economic vibrancy, and social stability, its seven million people have yet to be allowed to freely choose their municipal political leaders.
Topic:
International Relations, Government, and Political Economy
Political Geography:
China and Israel

3139. China Brief, China and Japan: The Separation of Economics and Politics

Author:
Christine Loh, Eugene Kogan, Willy Lam, Drew Thompson, and Zhu Feng
Publication Date:
09-2004
Content Type:
Policy Brief
Institution:
The Jamestown Foundation
Abstract:
The soon-to-be-announced appointment of former Vice-Foreign Minister Wang Yi as Chinese Ambassador to Japan is emblematic of efforts by the Hu Jintao-Wen Jiabao leadership to improve Sino-Japanese relationship. In the past year, bilateral ties have deteriorated due to a host of issues ranging from “the question of history” – and compensation for World War II-related damages – to altercations over rights to oil and gas under the East China Sea. Protests by nationalistic Chinese groupings outside the Japanese Embassy in Beijing, banned until about two years ago, have become almost routine. Ugly scenes at a recent soccer match between the two national teams in the Chinese capital demonstrated the hostility with which many Chinese regard their nextdoor neighbor. And in Japan, the “China threat” theory is fast gaining ground owing to the perception that an economically and militarily strong China is throwing its weight around and threatening Japanese interests everywhere.
Topic:
International Relations, Government, and Political Economy
Political Geography:
Japan, China, and Israel

3140. China Brief, New Challenges in the Election Season

Author:
Stephen Green, Willy Lam, Eric Teo, and Alexandr Nemets
Publication Date:
08-2004
Content Type:
Policy Brief
Institution:
The Jamestown Foundation
Abstract:
Although the Chinese leadership faces no electoral contenders, Beijing will soon have to deal with two uncertain but crucial elections in the next four months, the consequences of which could have serious implications for China's internal political cohesiveness as well as regional stability. In September, Hong Kongers will elect their Legislative Council (Legco), of which 30 seats are set aside for election through universal suffrage and the other 30 through “functional representation.” And in December, Taiwanese go to the polls to choose their next Legislative Yuan (Taiwan's legislature), nine months after they had renewed the mandate of President Chen Shui-Bian for a second term in March.
Topic:
International Relations, Government, and Political Economy
Political Geography:
China, Israel, and Taiwan

3141. China Brief,Beijing's Reaction to East Asia's Changing Alliance

Author:
Christine Loh, Willy Lam, Eric Teo, and Steven Sun
Publication Date:
07-2004
Content Type:
Policy Brief
Institution:
The Jamestown Foundation
Abstract:
If China had sufficient economic and military prowess, there seems little doubt the Chinese Communist Party (CCP) leadership would “go teach the U.S. a lesson” for the wrongs it had allegedly inflicted upon on the country. Previous CCP administrations had used similar clauses of indignation – and the assertion of a moral high ground based on self-defense and the preservation of sovereign rights – when they went to war with nations including India, Russia and Vietnam. And while the Chinese party and military leadership may for the time being be deterred by America's superpower status from trying out something rash, tension between China on the one hand, and the U.S. and many Asian countries on the other, is expected to rise in the foreseeable future.
Topic:
International Relations, Government, and Political Economy
Political Geography:
Russia, China, America, Asia, and Vietnam

3142. China Brief, No More 'Soft Sell' for Hong Kong

Author:
Willy Lam, Zhu Feng, Kevin Scott, Marat Yermukanov, and Andrew Thompson
Publication Date:
07-2004
Content Type:
Policy Brief
Institution:
The Jamestown Foundation
Abstract:
Beijing has acted quickly to dash the hopes that the half-a-million-people rally in Hong Kong last week will change the leadership's hard-line stance toward universal-suffrage elections in the special administrative region (SAR). While the Chinese Communist Party (CCP) has continued with its public-relations, united-front offensive to win hearts and minds in the territory, it is expected to step up its divide-and-run tactics in order to isolate and marginalize pro-democracy politicians and intellectuals who dare challenge Beijing's suzerainty.
Topic:
International Relations, Government, and Political Economy
Political Geography:
China, Israel, Beijing, and Hong Kong

3143. China Brief, A Prisoner's Dilemma: The EU's China Arms Embargo

Author:
Willy Lam, Richard A. Bitzinger, Alexandr Nemets, and Enzio Von Pfeil
Publication Date:
06-2004
Content Type:
Policy Brief
Institution:
The Jamestown Foundation
Abstract:
In April, the European Union (EU) dodged a bullet by refusing to take up the issue of overturning its 15-year-old ban on selling arms to China. Supporters of lifting the embargo, led by France and Germany, are unlikely to abandon their quest, however, and the issue will likely come up again for review, perhaps as early as this summer. If it lifts the ban, the EU risks further damaging a transatlantic alliance already strained over Iraq and other issues, with very little likelihood that its defense industry would see much, if any, benefit.
Topic:
International Relations, Government, and Political Economy
Political Geography:
China, Europe, and Israel

3144. China Brief, A Warming Friendship: Part II of a Two Part Series on China, Taiwan, and Latin America

Author:
Willy Lam, Drew Thompson, Cynthia Watson, and James P. Jr. Muldoon
Publication Date:
06-2004
Content Type:
Policy Brief
Institution:
The Jamestown Foundation
Abstract:
The recent spate of articles on China's growing energy and natural resource consumption is a key explanation for Beijing's growing interest in South America. While the continent remains at least fourth on China's list of priorities, the vast array of resources available, coupled with a growing population eager to increase its consumption of goods, makes this part of the world ever more enticing. The People's Republic of China (PRC) seeks to put a modest investment in diplomatic, military, cultural, and trade relations for a possible long-term gain of significant proportion.
Topic:
International Relations, Government, and Political Economy
Political Geography:
China, Israel, Beijing, and South America

3145. China Brief, Balancing U.S. Interests in the Strait

Author:
Ronald N. Montaperto, Willy Lam, Cynthia Watson, and Jean-Pierre Cabestan
Publication Date:
05-2004
Content Type:
Policy Brief
Institution:
The Jamestown Foundation
Abstract:
In the view of many observers, the normalization of Sino-American relations signaled the end of a strategic relationship with the Republic of China (Taiwan) that had endured with but one brief interruption for forty years. The rapid growth of economic ties between the U.S. and mainland China in the 1980s seemed to confirm this assessment. Although political connections through the Taiwan Relations Act (TRA) remain strong, the major benefit to the United States of its unofficial relationship to the island lies in the economic realm.
Topic:
International Relations, Government, and Political Economy
Political Geography:
United States, China, Israel, and Taiwan

3146. China Brief, The Dragon's Drive for Caspian Oil

Author:
Ahmad Lutfi, John C. K. Daly, Stephen Bank, and Sergei Troush
Publication Date:
05-2004
Content Type:
Policy Brief
Institution:
The Jamestown Foundation
Abstract:
China's insatiable energy thirst is causing it to undertake a global search for energy supplies to sustain its booming economy. Beijing has injected itself into the complex Caspian chess match to ensure itself as large a share as possible of resources being developed there. This complex political and economic maneuvering forces China to deal with the Caspian's five riparian states - Russia, Azerbaijan, Iran, Kazakhstan and Turkmenistan.
Topic:
International Relations, Government, and Political Economy
Political Geography:
Russia, China, Iran, Israel, Kazakhstan, Beijing, Azerbaijan, and Turkmenistan

3147. China Brief, Kim Jong-Il's Visit to Beijing: What Does it Mean for the West?

Author:
Mohan Malik, Matthew Oresman, Willy Lam, and Paul H.B Godwin
Publication Date:
04-2004
Content Type:
Policy Brief
Institution:
The Jamestown Foundation
Abstract:
The unusually effusive reception that the Chinese leadership accorded Dear Leader Kim Jong-Il last week has buttressed speculation that Beijing and Pyongyang probably reached some form of a deal even prior to the long awaited visit. According to diplomatic sources in Beijing, Kim agreed during discussions with his Chinese hosts to take a “more serious and proactive stance” toward the ongoing six-nation talks on dismantling his country's weapons of mass destruction (WMD). Moreover, the sources said the reclusive leader pledged that unless there was further “provocation” from the United States, Pyongyang would not engage in tension raising gimmicks such as testing bombs or missiles. And, at least for the time being, a freeze would be put on the development of new WMD.
Topic:
International Relations, Government, and Political Economy
Political Geography:
United States, China, Israel, Beijing, and Pyongyang

3148. China Brief,China's Reaction to America's Iraq Imbroglio

Author:
You Ji, Igor Rotar, Willy Lam, and Eric Teo
Publication Date:
04-2004
Content Type:
Policy Brief
Institution:
The Jamestown Foundation
Abstract:
The Chinese Communist Party (CCP) leadership has been at pains not to appear to be gloating over the American quagmire in Iraq. Yet in terms of geopolitical calculus, there is little doubt Beijing sees America's worsening problems in Iraq as beneficial to China's global standing, diplomatically and militarily. Capitalizing on fissures in the international community over Iraq and America's war on terror, China has strengthened ties with key members of the European Union and the United Nations in an effort to counterbalance U.S. hegemony. Meanwhile, Chinese experts' scrutiny of the exploits as well as challenges of American and Allied Forces in Iraq will have a big impact on the People's Liberation Army's (PLA) ambitious modernization drive.
Topic:
International Relations, Government, and Political Economy
Political Geography:
China, Iraq, America, Europe, Israel, and Beijing

3149. China Brief, Chen shui-bian after the election: lame duck or phoenix?

Author:
Bernard D. Cole, Willy Lam, Arnold Zeitlin, and Harvey Stockwin
Publication Date:
04-2004
Content Type:
Policy Brief
Institution:
The Jamestown Foundation
Abstract:
Beijing's unusually cautious response to Taiwan's disputed presidential polls shows that the Chinese Communist Party (CCP) leadership has yet to come to a consensus on how to deal with four more years of administration under 'splittis' President Chen Shui-bian. This, despite the fact that with the country's fastgrowing economic, military and diplomatic clout, Beijing would seem to enjoy unquestioned superiority over the increasingly divided island of Taiwan.
Topic:
International Relations, Government, and Political Economy
Political Geography:
China, Israel, Taiwan, and Beijing

3150. China Brief,Cross-Strait Relations In Taiwan's Presi - Dential Elections

Author:
Willy Lam, Jonathan Mirsky, Enzio von Pfeil, and Ashok Kapur
Publication Date:
03-2004
Content Type:
Policy Brief
Institution:
The Jamestown Foundation
Abstract:
No military action for the Taiwan Strait--not even psychological warfare oriented missile drills such as those undertaken in late 1995 and early 1996--is being planned by the People's Liberation Army (PLA) for the coming year or so. And this will be true whether President Chen Shui-bian or his challenger, Kuomintang (KMT) Chairman Lien Chan, wins in the hotly contested polls on March 20. However, the Chinese Communist Party (CCP) leadership is readying hardball solutions to the reunification problem for the medium-term.
Topic:
International Relations, Government, and Political Economy
Political Geography:
China, Israel, and Taiwan