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41901. A Note on Credit Allocation, Income Distribution, and the Circuit of Capital (pdf)

Author:
Paulo dos Santos
Publication Date:
08-2013
Content Type:
Working Paper
Institution:
School of Oriental and African Studies - University of London
Abstract:
This note considers the relationship between credit allocation and the aggregate, class distribution of income in the Circuit of Capital. Production and consumption credit inject means of purchase in different locations in the monetary circuits of capitalist reproduction. On the basis of comparative-dynamic analysis of the properties of steady-state evolutions, the note shows that production credit increases the wage share in total income, while consumption credit increases profit shares. These findings hold in general for any evolution in which sectoral revenue- elasticities of outlays measure less than unity. The note also motivates a new endogenous approach to the aggregate distribution of income, and offers new analytical tools facilitating work based on demand-constrained models of the Circuit of Capital.
Topic:
Inequality, Income Inequality, Economic Theory, Credit, and Capital
Political Geography:
Global Focus

41902. Financing Water in Africa

Author:
Kate Bayliss
Publication Date:
08-2013
Content Type:
Working Paper
Institution:
School of Oriental and African Studies - University of London
Abstract:
Despite repeated policy initiatives from donors and governments, the human and economic cost of continued lack of access to safe water and sanitation in sub‐Saharan Africa remains high. This paper shows that a radical reorientation of policy is needed to achieve a significant increase in investment finance in order to raise access levels. Rather than continuing to pursue policies that have failed for the past two decades, such as bringing in the private sector and raising prices to cost recovery levels, attention needs to shift to wider aspects of domestic revenue mobilization to support public investment.
Topic:
Privatization, Water, Inequality, Investment, and Private Sector
Political Geography:
Africa

41903. A History of Polyvalent Structural Parameters: the Case of Instrument Variable Estimato

Author:
Duo Qin and Yanqun Zhang
Publication Date:
09-2013
Content Type:
Working Paper
Institution:
School of Oriental and African Studies - University of London
Abstract:
This paper investigates the rise and fall of the IV method in macro-econometric models and its subsequent revival in micro-econometric models. The key findings are: (i) the IV method implicitly breaks the contemporaneously circular causality postulated in a simultaneous- equation model (SEM) by redefining the conditional variable concerned as a suboptimal conditional expectation of it; (ii) the IV method falls out of favour in macro-econometrics mainly because of lack of empirical validations for such redefinitions; (iii) the IV method wins its popularity in micro-econometrics by its capacity to produce multiple suboptimal conditional expectations of the latent conditional variables of interest under the disguise of an SEM consistent estimator; nevertheless, (iv) such suboptimal conditional expectations give rise to the insurmountable difficulty of credibly interpreting the IV-based parameter estimates, especially in the case of prognosticated omitted variable bias. The findings highlight the methodological drawback of the estimator-centric strategy of textbook econometrics.
Topic:
Economic Theory, Macroeconomics, and Microeconomics
Political Geography:
Global Focus

41904. Modelling Scale Effect in Crosssection Data:The Case of Hedonic Price Regression

Author:
Duo Qin and Yimeng Liu
Publication Date:
09-2013
Content Type:
Working Paper
Institution:
School of Oriental and African Studies - University of London
Abstract:
An innovative and simple experiment with cross-section data ordering is carried out to exploit a basic and common feature between many economic variables – nonlinear scale dependence. The experiment is tried on hedonic price regression models using two data sets, one for automobiles and the other computers. The key findings are: (a) Hedonic price indices can be significantly biased if they are constructed using models which disregard possible nonlinear scale effects latent in random data samples; (b) Scale-based data ordering offers considerable potential to filter such scale-dependent information from cross-section samples; (c) The filtering can be easily carried out by systematic adoption of dynamic modelling methods.
Topic:
Science and Technology, Economic Theory, Models, and Price Regression
Political Geography:
Global Focus

41905. Price Non-Convergence in Commodities: A Case Study of the Wheat Conundrum

Author:
Sophie van Huellen
Publication Date:
10-2013
Content Type:
Working Paper
Institution:
School of Oriental and African Studies - University of London
Abstract:
The close relationship between commodity future and cash prices is critical for the effectiveness of risk management and the functioning of price discovery. However, in recent years, commodity futures prices, across the board, have appeared increasingly detached from prices on physical markets. This paper argues that while various factors, identified in previous literature, which introduced limits to arbitrage have facilitated non-convergence, the actual extent of non-convergence in these markets is caused by essential differences in the mechanisms of price formation on physical and derivative markets. With reference to the particular case of the CBOT wheat market, the paper shows that the size of the spread between futures and cash prices can be theoretically and empirically linked to the increasing inflow of financial investment into commodity futures markets.
Topic:
Agriculture, Markets, Commodities, and Financialisation
Political Geography:
Global Focus

41906. Capital Flows to Emerging Markets: An alternative Theoretical Framework

Author:
Bruno Bonizzi
Publication Date:
11-2013
Content Type:
Working Paper
Institution:
School of Oriental and African Studies - University of London
Abstract:
This paper represents a theoretical contribution to the analysis of international capital flows. It outlines an alternative theoretical framework based on Post-Keynesian monetary theory, and in particular on Hyman Minsky’s Wall Street paradigm and concept of Money-manager capitalism and Jan Toporowski’s theory of capital market inflation. The key aspects of such an approach are, firstly, that in a monetary analysis capital flows need to be understood as “flows of funds”, as opposed to the traditional understanding of capital flows based on “real” decision, such as saving and investment. A consequence of this is the need of focusing on gross rather than net capital flows. Secondly, when considering emerging markets, the asymmetric nature of the international monetary system must be stressed. Thirdly, it is important to understand the specific forms that capital flows take: in today’s world, pension funds and other institutional investors — alongside banks — are key players in the financial markets, and their role in shaping capital flows to emerging markets must be explicitly recognised. This paper synthesises these elements by understanding capital flows as the result of institutional investors portfolio choice. Along the lines of Minsky and Toporowski, portfolio choice by institutional investors need to be assessed in relation to their balance sheet structure, beside risk/return trade-offs and general state of risk aversion
Topic:
Emerging Markets, Capital Flows, Investment, and Economic Theory
Political Geography:
Global Focus

41907. After Qaddafi: Building Peace in Libya

Author:
Muzaffer Ercan Yilmaz
Publication Date:
12-2013
Content Type:
Journal Article
Journal:
Bilgi
Institution:
Sakarya University (SAU)
Abstract:
After the overthrown of Qaddafi, Libya has a historic opportunity to become a democratic country in the Western sense if peace building process is successfully completed in the country in the post-conflict period. This article aims to outline the basic steps of the peace building process, involving transitional justice, forming a representative government, strengthening security, making a new constitution, economic reconstruction, and national reconciliation, in that order. The study also emphasizes that since post-conflict situations usually require outside help due to institutional weaknesses, as well as limited human and financial resources, the assistance of the international community to Libya is crucial in the process of peace building.
Topic:
Civil War, Social Movement, Arab Spring, Peace, and State Building
Political Geography:
Africa and Libya

41908. Viral Voices: Revolutionary Song, Social Media, and Youth Culture in the Arab Spring

Author:
Victor A. Vicente
Publication Date:
12-2013
Content Type:
Journal Article
Journal:
Bilgi
Institution:
Sakarya University (SAU)
Abstract:
Focusing on three popular “anthems” of the Arab Revolutions (“Rais Lebled” by El Général, “#Jan25 Egypt” by Omar Offendum, and “Yalla Erhal Ya Bashar” by “Ibrahim Qashoush”) this article critically assesses the ways in which song has come to serve as a force for instigating socio-political and cultural change in the contemporary Arab World, particularly in Tunisia, Egypt, and Syria. The appeal and efficacy of these songs of the “Arab Spring,” as well as their characterization as “revolutionary,” are understood in aesthetic and technological terms. Hence, the article untangles a complex of interconnected, musically-related themes and issues at the core of the discourse on the recent uprisings; namely, those of self-expression and the power of the Arab youth “voice,” those of transitional dissemination via social media and information and communication technology, and those of documentation and representation through music, specifically through the genre of rap. Analysis of the songs and the themes surrounding them demonstrates substantive advancements in contemporary Arab musical, social, and political life, but also exposes serious shortcomings, naïve misconceptions, and willful exaggerations.
Topic:
Culture, Social Media, Arab Spring, Revolution, and Music
Political Geography:
Africa, Middle East, Syria, Tunisia, and Egypt

41909. The Role of the Military in the Constitution-making Process as a part of Democratic Transition: The Comparative Cases of Turkey and Egypt

Author:
Merve Ince
Publication Date:
12-2013
Content Type:
Journal Article
Journal:
Bilgi
Institution:
Sakarya University (SAU)
Abstract:
The role of the military in the politics in the developing or socalled “Third World” countries has always been fundamental in order to comprehend the historical process of democratization movements in these countries. To be able to fully grasp the politics, particularly democratic transitions, in the Middle East, it is indispensable to look at the role of the military within the transition process. However, because the democratic transition processes involves different practices, in my research paper, I will focus on the role of military within the constitution-making processes in order to narrow down my research. I have chosen the constitution-making process because, as argued by Özbudun, constitution-making, especially during democratic transitions, is an excellent opportunity to build political institutions that will enjoy broad support from society and its political elites. Both the constitution-making process and its outcome are crucial aspects of the transition to and consolidation of democracy. In this regard, in this study, I have chosen to study Egypt and Turkey comparatively in terms of their military involvement in the constitution making process. It should be noted that in both Turkey and Egypt, previous constitutions were made directly by the military or under military influence through various means, which I will evaluate in my research paper in detailed way. I have chosen these two countries due to two reasons. My initial inspiration is derived from that currently, these two significant countries of the region are in the constitution-making process. When we look at current situation of Turkey, it can be argued that Turkey is in constitution-making process, which is supposed to be totally civilian without the influence of the military. On the other hand, in terms of Egypt, it is argued that following to the Arab Spring, Egypt’s new constitution will be the roadmap to a second republic that most Egyptians hope will be free from the tyranny, corruption, and nepotism, which were the trademarks of Egypt’s political life. The second reason is that despite the fact that Egypt and Turkey differ from each other in terms of longevity of their democratic experiences, the militaries of two countries demonstrate some core similarities, which is noteworthy in terms of comparing the two. Considering all of these, the aim of this study is to see how the military can be a part of the political system, especially in the making of constitution, and to understand the current situation and changing position of the militaries in these countries.
Topic:
Military Affairs, Democracy, State Building, and Transition
Political Geography:
Africa, Europe, Turkey, Asia, and Egypt

41910. From Spring to Summer? Revolutionary Change in Tunisia, Egypt and Libya

Author:
Imad El-Anis and Ashraf Hamed
Publication Date:
12-2013
Content Type:
Journal Article
Journal:
Bilgi
Institution:
Sakarya University (SAU)
Abstract:
This article offers an analysis of the early stages of the revolutions that have been taking place in Tunisia, Egypt and Libya. Here we consider the early stages of the revolutions from winter 2010-11 up until the summer of 2012 and offers a comparative study of the experiences of the early stage of the revolutions in each case study. In particular this study considers the roles of six variables on the process of regime change and transition as follows: 1) duration of the uprising up to regime change; 2) the initial outcome of the revolution/uprising; 3) the number of deaths and casualties; 4) the postregime change status of key members of the former governing elite; 5) the existence and nature of post-regime change elections; and 6) levels of international involvement. This study finds that in all three case studies, considering these variables offers insight into the nature and effect of the early stages of the revolutions. Furthermore, in each case there are key similarities in some of these variables but significant differences in others which suggest that the processes of transition are not directly comparable with each other. This article also offers some thoughts on how the early stages of these revolutions could affect the direction and pace of change in each state.
Topic:
Regime Change, Democracy, Arab Spring, and Revolution
Political Geography:
Africa, Middle East, Libya, Egypt, and Tunisia