Content Type: Working Paper / Political Geography: Europe / Topic: Economics

101. A Relationship and a Practice: On the French Sociology of Credit

Author:: Laure Lacan and Jeanne Lazarus
Publication Date:: 02-2015
Content Type:: Working Paper
Institution:: Max Planck Sciences Po Center on Coping with Instability in Market Societies (MaxPo)
Abstract:: This paper aims to describe the social studies of credit developed in France over the past dozen years. We argue that this French sociology of credit, mostly centered on France, can be useful for researchers analyzing other countries, with other institutional particularities, because it proposes a specific method and a specific way to raise questions: credit is mostly understood as a result of social interactions embedded in organizational and legal structures. French researchers also deeply analyze the consequences of the organization of the credit market for inequalities, social stratification, and people’s life experiences. The first part of the paper focuses on works that have examined credit as a social test, looking at the institutional, technical, and social frameworks of money lending. Then, credit is understood as a sociological experiment: how is it integrated into household economies? How do people use forms of credit? Finally, the third part concentrates on credit failure, when a bank loan becomes a debt. This aspect is mostly framed in French sociology as “over-indebtedness,” which is an administrative and a social category. Throughout the paper, we address credit as both a relationship and a practice. This approach is heuristic, as we seek to demonstrate, because it enables us to show that credit is a social and political issue.
Topic:: Debt, Economics, Sociology, Inequality, and Credit
Political Geography:: Europe and France

102. Politics in the Interest of Capital: A Not-So-Organized Combat

Author:: Cornelia Woll
Publication Date:: 07-2015
Content Type:: Working Paper
Institution:: Max Planck Sciences Po Center on Coping with Instability in Market Societies (MaxPo)
Abstract:: The rise in inequality has been explained with reference to organized groups and the lobbying of the financial sector. This article argues that the image of politics as organized combat is contradicted by empirical evidence on lobbying in the United States, and does not travel well to Europe. The power of finance does not operate through organized political influence. Rather, politics in the interest of capital unfolds as a structural feature of advanced economies over time. Tellingly, at the height of the financial crisis, one of the most promising strategies of institutions seeking government support was not organizing for combat, but collective inaction. Our challenge, then, is to explain how the power of finance has built up and is playing out in creating inequality. A more structural, less agency-focused perspective highlights how the rise of finance has been supported by actors that few would accuse of being finance-friendly, such as the European center-left parties and consumers. Reconceptualizing the power of finance has important implications for political solutions to rising inequality.
Topic:: Economics, Politics, Inequality, Finance, and Capital
Political Geography:: Europe

103. After the Crash: A Perspective on Multilevel European Democracy

Author:: Fritz W. Scharpf
Publication Date:: 12-2014
Content Type:: Working Paper
Institution:: Max Planck Institute for the Study of Societies
Abstract:: At the end of the postwar period, the politically shaped configurations of normatively integrated European political economies differed greatly among “social-market” and “liberal market economies.” Such differences persist even though the characteristic achievements of social market economies have since eroded under the pressures of global capitalism and of European integration. Focusing on European integration from a social-market perspective, there is no question that it has widened the range of individual options. But it has also reduced the capacity of democratic politics to deal with the challenges of global capitalism, and it has contributed to rising social inequality and the erosion of public services and transfers. This paper will first summarize those asymmetries of European integration which have done the most to constrain democratic choices and to shift the balance between capital, labor, and the state by establishing an institutional priority of negative over positive integration and of monetary integration over political and social integration. It will then explain why efforts to democratize European politics will not be able to overcome these institutional asymmetries and why politically feasible reforms will not be able to remove the institutional constraints. The changes that would be required to restore democratic capacities to shape the political economy could only have a chance if present veto positions were to be fundamentally shaken. On the speculative assumption that the aftermath of a deep crisis might indeed create the window of opportunity for a political re-foundation of European integration, the concluding section will outline institutional ground rules that would facilitate democratic political action at both the European and national levels.
Topic:: Economics, Markets, Politics, Labor Issues, Democracy, and Capitalism
Political Geography:: Europe

104. No Exit from the Euro-rescuing Trap?

Author:: Fritz W. Scharpf
Publication Date:: 03-2014
Content Type:: Working Paper
Institution:: Max Planck Institute for the Study of Societies
Abstract:: This paper attempts a normative assessment of the input and output-oriented legitimacy of the present euro-rescuing regime on the basis of policy analyses examining the causes of present crises, the available policy options, and the impact of the policies actually chosen. Concluding that the regime lacks input-oriented legitimacy and that its claim to output-oriented legitimacy is ambivalent at best, the paper explores potential – majoritarian or unilateral – exits from the present institutional constellation that is characterized by the synthesis of a non-democratic expertocracy and an extremely asymmetric intergovernmental bargaining system.
Topic:: Economics, Politics, Financial Crisis, and Democracy
Political Geography:: Europe

105. Challenging Varieties of Capitalism's Account of Business Interests: The New Social Market Initiative and German Employers' Quest for Liberalization, 2000–2014

Author:: Daniel Kinderman
Publication Date:: 11-2014
Content Type:: Working Paper
Institution:: Max Planck Institute for the Study of Societies
Abstract:: Do employers in coordinated market economies (CME’s) actively defend the non-liberal, market-constraining institutions upon which their strategic coordination and competitive success depends? This paper revisits the debate over firms’ employer preferences with an in-depth examination of employers in Germany – a paradigmatic CME and crucial “test case” for Varieties of Capitalism. It is based on interviews with key officials and an in-depth examination of a large-scale campaign – the New Social Market Initiative or INMS – founded and funded by German metalworking employers to shape public opinion. The paper argues that German employers have a strong preference for liberalization: they have pushed hard for the liberalization of labor markets, the reduction of government expenditures, the expansion of market-oriented freedoms, and cuts to social protection, employment protection and benefit entitlements. I find no empirical support for the claim that the INSM is an attempt to appease discontented firms within employers’ associations. On the contrary: for many employers, the Agenda 2010 reforms did not go far enough. Following the discrediting of the Anglo-American model in the financial crisis, far-reaching concessions by employees, and the unexpected revitalization of the German economy, employers have moderated their demands – but liberalization remains their default preference. This paper also addresses the role of ideas and the conditions under which employer campaigns can influence policy.
Topic:: Economics, Markets, Labor Issues, and Capitalism
Political Geography:: Europe and Germany

106. Monetary Disunion: The Domestic Politics of Euroland

Author:: W. Streeck and L. Elsässer
Publication Date:: 10-2014
Content Type:: Working Paper
Institution:: Max Planck Institute for the Study of Societies
Abstract:: Regional disparities within the European Union have always been perceived as an impediment to monetary integration. This is why discussions on a joint currency, from their very beginning, were linked to compensatory payments in the form of regional policy payments. Structural assistance to poor regions and member states increased sharply at the end of the 1980s. Today, however, fiscal support has to be shared with the new member states in the East. Moreover, due to the financial crisis, the cheap credit that poor EMU member countries enjoyed as a result of interest rate convergence is no longer available. We predict that in the future, some sort of financial aid will have to be provided by rich member countries to poor ones, if only to prevent a further increase in economic disparities and related political instability. We also expect long-lasting distributional conflict between payer and recipient countries far beyond current rescue packages, together with disagreement on the extent of aid required and the political control to be conceded by receiving countries to giving countries. We illustrate the dimension of the distributional conflict by comparing income gaps and relative population size between the center and the periphery of Europe on the one hand and on the other, between rich and poor regions in two European nation-states characterized by large regional disparities, Germany and Italy. While income gaps and population structures are similar in the two countries to those between Northern Europe and the Mediterranean periphery, regional redistribution is much more extensive in the two nation-states. We conclude that this presages a difficult future for the domestic politics of Euroland.
Topic:: Economics, Politics, Financial Crisis, and European Union
Political Geography:: Europe

107. Europe Meets Asia: The Transnational Construction of Access and Voice from Below

Author:: Sabrina Zajak
Publication Date:: 02-2014
Content Type:: Working Paper
Institution:: Max Planck Institute for the Study of Societies
Abstract:: This paper contributes to the debate on the role of democratic participation in complex systems of governance. It takes a process-oriented constructivist approach asking how transnational activism over time contributes to the construction of access and voice from below and uses the Asia-Europe Meetings (ASEM) to analyze how interactions between civil society and global governance institutions shape concrete forms of participation. The paper shows that transnational activism triggers both discursive and institutional changes within the official ASEM process leading to an informal, fragmented, and fragile institutionalization of civil society participation. However, the paper reveals a division between civil society organizations with some, such as business representatives, having preferential access and voice in comparison to more contentious organizations. The paper explains this fragmented form of democratization as the result of three interrelated processes: the particular history and economic origins of the ASEM; international developments particularly in the ongoing economic crisis; and domestic developments within individual countries (in particular China) which have begun to favor controlled access for civil society participation.
Topic:: Civil Society, Democratization, Economics, History, Governance, and Developments
Political Geography:: Europe and Asia

108. Can Negotiating a Uniform Carbon Price Help to Internalize the Global Warming Externality?

Author:: Martin L. Weitzman
Publication Date:: 01-2014
Content Type:: Working Paper
Institution:: Belfer Center for Science and International Affairs, Harvard University
Abstract:: It is difficult to resolve the global warming free-rider externality problem by negotiating quantity targets. By contrast, negotiating a single binding minimum carbon price (the proceeds from which are domestically retained) counters self interest by incentivizing agents to internalize the externality. The model of this paper indicates an exact sense in which each agent's extra cost from a higher emissions price is counterbalanced by that agent's extra benefit from inducing all other agents to simultaneously lower their emissions. Some implications are discussed.
Topic:: Climate Change, Economics, Energy Policy, Industrial Policy, and International Cooperation
Political Geography:: Europe

109. The Urban Regeneration Experience of The United Kingdom: Lessons for Turkey

Author:: Fatih Eren
Publication Date:: 09-2014
Content Type:: Working Paper
Institution:: Centre for Strategic Research and Analysis (CESRAN)
Abstract:: The United Kingdom (UK) is the most experienced country regarding the theories, policies, strategies and practices of urban regenerations in the world. This study firstly outlines UK’s urban regeneration experience and then discusses how Turkey can benefit from this experience in the best way. The global financial crisis emerged in 2008 forced the UK to go a change in its national urban regeneration policy. Therefore, this paper has been divided into two parts as UK’s urban regeneration policy before and after 2010.
Topic:: Economics, International Cooperation, Financial Crisis, and Urban
Political Geography:: United Kingdom, Europe, Turkey, and Asia

110. Rethinking the Financial Design of the World Bank

Author:: Devesh Kapur and Arjun Raychaudhuri
Publication Date:: 01-2014
Content Type:: Working Paper
Institution:: Center for Global Development
Abstract:: Since their inception, through 2012, the institutions comprising the World Bank group have been involved in lending nearly a trillion dollars. In this paper, we focus on the IBRD, which is the core of the World Bank. The IBRD has the potential to continue to grow and be an important player in official financial flows, supporting critical long-term development projects with large social returns, in sectors ranging from infrastructure, social sectors, or environment.
Topic:: Development, Economics, Environment, Foreign Aid, Infrastructure, and World Bank
Political Geography:: Europe

111. Estimating Illicit Flows of Capital via Trade Mispricing: A Forensic Analysis of Data on Switzerland

Author:: Alex Cobham, Petr Janský, and Alex Prats
Publication Date:: 01-2014
Content Type:: Working Paper
Institution:: Center for Global Development
Abstract:: This paper assesses the role of Switzerland as the leading hub for global commodities trading, in terms of the patterns of prices received by original exporting countries and subsequently by Switzerland and other jurisdictions. We find support for the hypotheses that (i) the average prices for commodity exports from developing countries to Switzerland are lower than those to other jurisdictions; and that (ii) Switzerland declares higher (re-)export prices for those commodities than do other jurisdictions. This pattern implies a potential capital loss for commodity exporting developing countries and we provide a range of estimates of that loss - each of which suggests the scale is substantial (the most conservative is around $8 billion a year) and that the issue merits greater research and policy attention. An important first step would be a Swiss commitment to meet international norms of trade transparency.
Topic:: Economics, Industrial Policy, International Trade and Finance, Markets, and Developing World
Political Geography:: Europe and Switzerland

112. Reforming Finance: Macro and Micro Perspectives

Author:: Pierre Siklos
Publication Date:: 02-2014
Content Type:: Working Paper
Institution:: Centre for International Governance Innovation
Abstract:: Reforms of the financial system in the wake of the global financial crisis are incomplete. Beyond reforms, good judgment is essential in a crisis. Short-termism in finance cannot be completely controlled by regulation and supervision. Financial crises are inevitable but need not be as virulent at the global financial crisis. Central banks will have to rethink their policies and how they interact with other agencies partially responsible for maintaining financial system stability.
Topic:: Economics, Globalization, International Trade and Finance, Financial Crisis, Governance, and Reform
Political Geography:: Europe

113. Time to Reset the European Neighborhood Policy

Author:: Stefan Lehne
Publication Date:: 02-2014
Content Type:: Working Paper
Institution:: Carnegie Endowment for International Peace
Abstract:: Through its European Neighborhood Policy (ENP), the European Union (EU) aims to support the structural transformation of its Eastern and Southern neighbors, promoting democracy, the rule of law, and successful market economies. Ten years after the ENP's launch, it is clear that the policy is not working. Adjusting the ENP to the changing reality on the ground, sharpening its tools, and rebuilding its credibility should be a top priority for the EU's foreign policy leadership.
Topic:: Foreign Policy, Democratization, Economics, International Trade and Finance, and Markets
Political Geography:: Europe

114. Supporting The Internet as a Platform for International Trade

Author:: Joshua Meltzer
Publication Date:: 02-2014
Content Type:: Working Paper
Institution:: The Brookings Institution
Abstract:: This paper is about the potential of the Internet as a platform for international trade. A traditional understanding of the impact of the Internet on commerce is derived from the dot.com experience of the 1990s, where Internet companies such as Pets.com and Amazon sold goods online. Since then, the impact of the Internet on commerce has grown and changed. Certainly, the ability to sell goods online remains important. However, the key development is that the Internet is no longer only a digital storefront. Instead, the Internet as described in this working paper is a platform for businesses to sell to customers domestically and overseas, and is a business input that increases productivity and the ability of businesses to compete. Understanding the Internet as a platform for trade highlights its broad economic potential. It emphasizes how the commercial opportunities are no longer limited to Internet companies, but are now available for businesses in all sectors of the economy, from manufacturing to services. Moreover, the global nature of the Internet means that these opportunities are no longer limited to domestic markets, but are embraced wherever Internet access is available.
Topic:: Economics, International Trade and Finance, Markets, Science and Technology, and Communications
Political Geography:: Africa, United States, and Europe

115. Turkey's Energy Strategy and its Role in the EU's Southern Gas Corridor

Author:: Erkan Erdogdu
Publication Date:: 02-2014
Content Type:: Working Paper
Institution:: Istituto Affari Internazionali
Abstract:: The Southern Gas Corridor (SGC) is a European Commission initiative aimed at facilitating the diversification of the routes and sources of gas imported into Europe. This paper is devoted to the analysis of Turkey's role in this initiative. Following a summary of the current economic and energy situation in Turkey, the paper presents recent developments in the SGC and an analysis of Turkey's role in the EU's SGC vision. It concludes that although the newly-built infrastructure within the SGC framework will probably serve Azerbaijani and Turkish interests first in their future relations with the EU, rather than the other way round, as had been initially hoped by the EU, it still addresses the EU's basic strategic interests, namely, the diversification of gas supply routes and suppliers.
Topic:: Economics, International Trade and Finance, and Natural Resources
Political Geography:: Russia, United Kingdom, Europe, Turkey, Asia, and Netherlands

116. Framing Banking Union in the Euro Area: Some empirical evidence

Author:: Diego Valiante
Publication Date:: 02-2014
Content Type:: Working Paper
Institution:: Centre for European Policy Studies (CEPS)
Abstract:: Evidence shows that financial integration in the euro area is retrenching at a quicker pace than outside the union. Home bias persists: Governments compete on funding costs by supporting 'their' banks with massive state aids, which distorts the playing field and feeds the risk-aversion loop. This situation intensifies friction in credit markets, thus hampering the transmission of monetary policies and, potentially, economic growth. This paper discusses the theoretical foundations of a banking union in a common currency area and the legal and economic aspects of EU responses. As a result, two remedies are proposed to deal with moral hazard in a common currency area: a common (unlimited) financial backstop to a privately funded recapitalisation/resolution fund and a blanket prohibition on state aids.
Topic:: Economics, International Trade and Finance, and Monetary Policy
Political Geography:: Europe

117. Future of Skills in Europe: Convergence or polarisation?

Author:: Miroslav Beblavý and Marcela Veselkova
Publication Date:: 02-2014
Content Type:: Working Paper
Institution:: Centre for European Policy Studies (CEPS)
Abstract:: In this Working Paper, based on nearly 20 papers produced by the Centre for European Policy Studies, Slovak Governance Institute and the Conference Board Europe, we examine whether the current trends in the areas of education and skills are pushing the European Union, towards convergence or polarisation. We cover a wide range of questions related to this main issue. No easy answers, but several cross-cutting messages emerged from the research. We demonstrated that there is increasing complexity in what a 'low-skilled' person is and how well (or poorly) s/he fares in the labour market. There are undoubtedly powerful forces pushing for more polarisation, particularly in the labour market. Our research confirmed that early childhood education plays an important role, and it also appears to be increasingly uncontested as a policy prescription. However, the other frequently emphasised remedy to inequality - less selection in secondary education, particularly later division of children into separate tracks - is more problematic. Its effectiveness depends on the country in question and the target group, while education systems are extremely difficult to shift even on a long-term basis. A different, more-nuanced type of warning to policy-makers is delivered in our research on returns to higher education by field of study, which showed hidden rationality in how students choose their major.
Topic:: Economics, Education, and Labor Issues
Political Geography:: Europe

118. The EU's Use of 'Targeted' Sanctions: Evaluating effectiveness

Author:: Clara Portela
Publication Date:: 03-2014
Content Type:: Working Paper
Institution:: Centre for European Policy Studies (CEPS)
Abstract:: This study analyses the use by the European Union of the novel concept of 'targeted sanctions' in the framework of its Common Foreign and Security Policy. It examines two sets of sanctions regimes featuring different degrees of efficacy: in Myanmar and Zimbabwe, the EU wielded measures in support of human rights and democracy objectives in the absence of a United Nations mandate, while it supplemented UN sanctions to stop nuclear proliferation in Iran and North Korea. The study highlights a number of facilitators of, or hindrances to, the efficacy of sanctions, such as the degree of support by regional powers or the presence of UN legitimation. It concludes that the EU sanctions regimes could be optimised by using more robust measures, designing them on the basis of ex ante assessments, enabling faster upgrades, monitoring their impact and adjusting them regularly and improving outreach efforts.
Topic:: Foreign Policy, Diplomacy, Economics, Regional Cooperation, and Sanctions
Political Geography:: United States, Europe, United Nations, and Zimbabwe

119. The Potential Evolution of the European Energy System to 2020 and 2050

Author:: Arno Behrens, Jonas Teusch, and Caroline Coulie
Publication Date:: 03-2014
Content Type:: Working Paper
Institution:: Centre for European Policy Studies (CEPS)
Abstract:: This paper assesses the impact of decarbonisation of the energy sector on employment in Europe. Setting the stage for such an assessment, the paper provides an analysis of possible pathways to decarbonise Europe's energy system, taking into account EU greenhouse gas emissions reduction targets for 2020 and 2050. It pays particular attention to various low-carbon technologies that could be deployed in different regions of the EU. It concludes that efficiency and renewables play a major role in any decarbonisation scenario and that the power sector is the main enabler for the transition to a low-carbon economy in Europe, despite rising electricity demand. The extent of the decline in the share of fossil fuels will largely depend on the existence of carbon capture and storage (CCS), which remains a major source of uncertainty.
Topic:: Economics, Energy Policy, and Science and Technology
Political Geography:: Europe

120. The EMS Crisis of the 1990s: Parallels with the present crisis?

Author:: Daniel Gros
Publication Date:: 03-2014
Content Type:: Working Paper
Institution:: Centre for European Policy Studies (CEPS)
Abstract:: The EMS crisis of the 1990 s illustrated the importance of a lack of confidence in price or exchange rate stability, whereas the present crisis illustrates the importance of a lack of confidence in fiscal sustainability. Theoretically the difference between the two should be minor since, in terms of the real return to an investor, the loss of purchasing power can be the same when inflation is unexpectedly high, or when the nominal value of government debt is cut in a formal default. Experience has shown, however, that expropriation via a formal default is much more disruptive than via inflation.
Topic:: Economics, International Trade and Finance, Monetary Policy, and Financial Crisis
Political Geography:: Europe and Italy

121. Cyber Threat and Response

Author:: James Andrew Lewis
Publication Date:: 03-2014
Content Type:: Working Paper
Institution:: Center for Strategic and International Studies
Abstract:: Everyone knows that the Internet has changed how we interact, do business, and share information. The Internet can be an "innovation engine," but the same engine of innovation drives cyber threats to change faster than cyber defenses can react. Cyber threats are complex, dynamic, and network defenses have trouble keeping up with them.
Topic:: Defense Policy, Economics, Science and Technology, and International Security
Political Geography:: Europe

122. Caspian Gas, TANAP and TAP in Europe's Energy Security

Author:: Ariel Cohen
Publication Date:: 04-2014
Content Type:: Working Paper
Institution:: Istituto Affari Internazionali
Abstract:: Russia's occupation of the Crimea and possible incorporation of Eastern Ukrainian regions demonstrated Europe's vulnerability to Gazprom's energy power. Whatever the EU's reactions, diversification of energy supply to diminish Russia's market share is likely to be one of them. TAP is one step towards the strategic goal of diminishing Gazprom's huge presence in Europe. But in view of the proposed construction of the Russian South Stream, how could Central Europe, and especially Bulgaria, Romania, Austria and Lithuania, ensure energy diversification? What next for the Southern Corridor? Is Russia going to accept and tolerate infrastructure growth of the Caspian and other competitors south of its borders?
Topic:: Economics, Energy Policy, and Markets
Political Geography:: Russia, Europe, Lithuania, Bulgaria, Romania, and Austria

123. Shale gas in Europe: much ado about little?

Author:: Tania Zgajewski
Publication Date:: 04-2014
Content Type:: Working Paper
Institution:: EGMONT - The Royal Institute for International Relations
Abstract:: Shale gas is an unconventional form of gas because its extraction is more difficult or less economical than that of conventional natural gas. It has become an important item of energy policy during the last years since new processes have allowed its extraction. In the medium term, shale gas should foster a reinforcement of the gas part in the world's energy mix. In 2011, the IEA released an influential report entitled "Are we entering a golden age of gas?" This report suggests that shale gas could help substantially boost global gas use. It also warns at the same time that this success could bring into question the international goal of limiting the long-term increase in the global temperature to 2° C above pre-industrial levels.
Topic:: Economics, Energy Policy, Environment, and Human Rights
Political Geography:: Europe

124. Energy moves and power shifts: EU foreign policy and global energy security

Author:: Iana Dreyer and Gerald Stang
Publication Date:: 02-2014
Content Type:: Working Paper
Institution:: European Union Institute for Security Studies
Abstract:: Energy security has climbed the list of EU energy and foreign policy priorities in the last decade. This process was accelerated by the shock of the 2006 and 2009 disruptions in Russian gas supply through Ukraine, and by the new possibilities offered by the Lisbon Treaty. Efforts have been directed at interconnecting national gas and electricity markets, diversifying energy suppliers and promoting rules-based energy trade in the wider European neighbourhood. The EU's primary energy security goals are to reduce the strategic dependence of individual member states on single external suppliers and to ensure that energy markets are liquid, open and functioning according to stable market rules rather than power logics. Yet energy security also needs to be balanced against environmental and economic competitiveness concerns.
Topic:: Economics, Energy Policy, International Trade and Finance, and Border Control
Political Geography:: Russia, Europe, and Ukraine

125. A Window of Opportunity to Upgrade EU Foreign Policy

Author:: Stefan Lehne
Publication Date:: 05-2014
Content Type:: Working Paper
Institution:: Carnegie Endowment for International Peace
Abstract:: As the financial crisis recedes and the European Union (EU) regains a measure of internal stability, pressure in Europe\'s neighborhood is on the rise. The Ukraine crisis and turmoil in the Middle East and North Africa have elevated foreign policy to the top of the EU\'s agenda. Whether the EU can make its external action more effective will depend in large part on institutional decisions made in 2014—the selection of a new leadership team and the reorganization of the European Commission.
Topic:: Security, Foreign Policy, Economics, Human Rights, and Regional Cooperation
Political Geography:: Europe, Ukraine, Middle East, and North Africa

126. Exports and Capacity Constraints: A smooth transition regression model for six euro-area countries

Author:: Ansgar Belke, Anne Oeking, and Ralph Setzer
Publication Date:: 05-2014
Content Type:: Working Paper
Institution:: Centre for European Policy Studies (CEPS)
Abstract:: The significant gains in export market shares made in a number of vulnerable euro-area crisis countries have not been accompanied by an appropriate improvement in price competitiveness. This paper argues that, under certain conditions, firms consider export activity as a substitute for serving domestic demand. The strength of the link between domestic demand and exports is dependent on capacity constraints. Our econometric model for six euro-area countries suggests domestic demand pressure and capacity-constraint restrictions as additional variables of a properly specified export equation. As an innovation to the literature, we assess the empirical significance through the logistic and the exponential variant of the non-linear smooth transition regression model. We find that domestic demand developments are relevant for the short-run dynamics of exports in particular during more extreme stages of the business cycle. A strong substitutive relationship between domestic and foreign sales can most clearly be found for Spain, Portugal and Italy, providing evidence of the importance of sunk costs and hysteresis in international trade.
Topic:: Economics, Human Rights, International Trade and Finance, and Financial Crisis
Political Geography:: Europe

127. Disappearing government bond spreads in the eurozone — Back to normal?

Author:: Paul De Grauwe and Yuemei Ji
Publication Date:: 05-2014
Content Type:: Working Paper
Institution:: Centre for European Policy Studies (CEPS)
Abstract:: Since the announcement of the Outright Monetary Transactions (OMT) programme by Mario Draghi, President of the ECB, in 2012, the government bond spreads began a strong decline. This paper finds that most of this decline is due to the positive market sentiments that the OMT programme has triggered and is not related to underlying fundamentals, such as the debt-to-GDP ratios or the external debt position that have continued to increase in most countries. The authors even argue that the market's euphoria may have gone too far in taking into account the same market fundamentals. They conclude with some thoughts about the future governance of the OMT programme.
Topic:: Economics, International Trade and Finance, and Markets
Political Geography:: Europe

128. The EU regime on biofuels in transport: Still in search of sustainability

Author:: Tania Zgajewski
Publication Date:: 08-2014
Content Type:: Working Paper
Institution:: EGMONT - The Royal Institute for International Relations
Abstract:: Like other regions of the world, the EU is developing biofuels in the transport sector to reduce oil consumption and mitigate climate change. To promote them, it has adopted favourable legislation since the 2000s. In 2009 it even decided to oblige each Member State to ensure that by 2020 the share of energy coming from renewable sources reached at least 10% of their final consumption of energy in the transport sector. Biofuels are considered the main instrument to reach that percentage since the development of other alternatives (such as hydrogen and electricity) will take much longer than expected.
Topic:: Climate Change, Economics, Energy Policy, Environment, and Biofuels
Political Geography:: Europe

129. Industrial policy in the EU: A guide to an elusive concept

Author:: Xavier Vanden Bosch
Publication Date:: 09-2014
Content Type:: Working Paper
Institution:: EGMONT - The Royal Institute for International Relations
Abstract:: Despite renewed interest in an EU industrial policy, the concept remains particularly elusive because it has no universal definition. This paper relies on a broad and inclusive definition of industrial policy proposed by Warwick (in an OECD working paper) to provide a clearer picture of what the concept encompasses when applied to the EU. It therefore includes an original visual taxonomy of the EU policies that constitute industrial policy. It can serve as a guiding framework for reflecting on industrial policy in the EU.
Topic:: Economics, Industrial Policy, Political Economy, and Governance
Political Geography:: Europe

130. A Political Economy of Slum Spaces: Mathare Valley

Author:: Tiberius Barasa and Andvig Jens Chr
Publication Date:: 07-2014
Content Type:: Working Paper
Institution:: Norwegian Institute of International Affairs
Abstract:: The starting point of the paper is the spatial characteristics of slums when it seeks to explain why rulers tend to neglect the welfare of their dwellers: they don't have to. Their economies are fairly closed. While located close to the centers of power, their high population density implies that they cover small space and are easy to cordon off in case of danger. The ease of control from the outside allows rulers to spend less attention to the control of their complex inside. Particularly when a slum is based on shack architecture, the high degree of mutual monitoring among dwellers may cause sharp shifts in the control regime of crime. The emphasis on spatial configurations motivates the focus on one specific slum: Mathare Valley. Paths back to colonial rule are outlined. The paper is stylistically unkempt.
Topic:: Economics, Human Rights, Human Welfare, and Politics
Political Geography:: Europe and Eastern Europe

131. Versailles Redux? Eurozone Competitiveness in a Dynamic Balassa-Samuelson-Penn Framework

Author:: Arvind Subramanian and Kevin Stahler
Publication Date:: 11-2014
Content Type:: Working Paper
Institution:: Peterson Institute for International Economics
Abstract:: Prima facie, competitiveness adjustments in the eurozone, based on unit labor cost developments, appear sensible and in line with what the economic analyst might have predicted and the economic doctor might have ordered. But a broader and arguably better—Balassa-Samuelson-Penn (BSP)—framework for analyzing these adjustments paints a very different picture. Taking advantage of the newly released PPP-based estimates of the International Comparison Program (2011), we identify a causal BSP relationship. We apply this framework to computing more appropriate measures of real competitiveness changes in Europe and other advanced economies in the aftermath of the recent global crises. There has been a deterioration, not improvement, in competitiveness in the periphery countries between 2007 and 2013. Second, the pattern of adjustment within the eurozone has been dramatically perverse, with Germany having improved competitiveness by 9 percent and with Greece's having deteriorated by 9 percent. Third, real competitiveness changes are strongly correlated with nominal exchange rate changes, which suggests the importance of having a flexible (and preferably independent) currency for effecting external adjustments. Fourth, internal devaluation—defined as real competitiveness improvements in excess of nominal exchange rate changes—is possible but seems limited in scope and magnitude. Our results are robust to adjusting the BSP framework to take account of the special circumstances of countries experiencing unemployment. Even if we ignore the BSP effect, the broad pattern of limited and lopsided adjustment in the eurozone remains.
Topic:: Economics, Industrial Policy, International Trade and Finance, Monetary Policy, and Financial Crisis
Political Geography:: Europe

132. The Trans-Atlantic Trade and Investment Partnership:European Disintegration, Unemployment and Instability

Author:: Jeronim Capaldo
Publication Date:: 10-2014
Content Type:: Working Paper
Institution:: Global Development and Environment Institute at Tufts University
Abstract:: According to its proponents, the Trans-Atlantic Trade and Investment Partnership will stimulate growth in Europe and in the US. Projections endorsed by the European Commission point to positive, although negligible, gains in terms of GDP and personal incomes. In a paradox, these projections also show that any gains in Trans-Atlantic trade would happen at the expense of intra-EU trade reversing the process of European economic integration. Furthermore, recent literature has pointed out several problems in the most influential assessment of the TTIP's effects. Projections by different institutions have been shown to rely on the same Computable General Equilibrium model that has proven inadequate as a tool for trade policy analysis. In this paper we assess the effects of TTIP using the United Nations Global Policy Model, which incorporates more sensible assumptions on macroeconomic adjustment, employment dynamics, and global trade. We project that TTIP will lead to a contraction of GDP, personal incomes and employment. We also project an increase in financial instability and a continuing downward trend in the labor share of GDP. Evaluated with the United Nations model, TTIP appears to favor economic dis-integration, rather than integration, in Europe. At a minimum, this shows that official studies do not offer a solid basis for an informed decision on TTIP.
Topic:: Economics, Globalization, International Trade and Finance, and Labor Issues
Political Geography:: United States, Europe, and United Nations

133. The Role of International Trade in the Rise of the New Zealand Dairy Industry from Its Beginnings to the Fonterra Era

Author:: Bruce Muirhead
Publication Date:: 08-2014
Content Type:: Working Paper
Institution:: Centre for International Governance Innovation
Abstract:: Since its widespread settlement by Europeans in the 1840s, New Zealand (NZ) has been an agricultural economy. As has been pointed out “there [has been] no serious challenge to the fundamental precept that the country's economy rested on an agricultural foundation” (Macdonald and Thomson 1987, 231), and dairy has been a significant focus of that base. Dairy production was introduced to New Zealand with the clear intent to establish New Zealand as an adjunct to the economic needs of Britain (Hawke 1985). Indeed, the closeness of the relationship between “the Britain of the south” and the metropolitan centre is one of the fundamental characteristics of any environmental history of NZ agriculture (Pawson 2008). This would persist in a material sense for more than a century, until the United Kingdom joined the European Community (EC) in 1973.
Topic:: Economics and Food
Political Geography:: Britain, United Kingdom, Europe, and New Zealand

134. Is the European Model Relevant for ASEAN?

Author:: Eleonora Poli
Publication Date:: 11-2014
Content Type:: Working Paper
Institution:: Istituto Affari Internazionali
Abstract:: Before the 1997 economic crisis in Asia, the institutional evolution of the Association of Southeast Asian Nations (ASEAN) was very different from the European model. The economic downturn in the late 1990s and the global shift toward a neo-liberal economic era urged ASEAN countries to rethink their regional integration strategy and to mimic some of the institutional models in Europe. In light of this, this paper analyses the rationale behind the evolution of ASEAN since the late 1990, evaluating how and why the organization on a surface replicated aspects of the EU model without engaging in meaningful supranational institutionalization.
Topic:: Economics, Regional Cooperation, and Governance
Political Geography:: Europe and Asia

135. European Banking Union: An Immediate Tool for Euro Crisis Management and a Long-Term Project for the Single Market

Author:: Giulia Rosa Maria Cavallo
Publication Date:: 10-2014
Content Type:: Working Paper
Institution:: Istituto Affari Internazionali
Abstract:: After the adoption of a single monetary policy which commits the European Central Bank to maintaining the euro's purchasing power and price stability in the Eurozone, the European Union is facing a new, but equally fundamental challenge: the implementation in a relatively short time of the so-called "Banking Union". Its purpose is twofold: (1) breaking the link between banking and sovereign risk, with the ultimate goal of achieving full protection of EU savers in the event of a crisis; and (2) ensuring uniformity of credit conditions - which are still too fragmented - within the European banking market, to ensure greater EU integration of the financial system. Starting from the Communication in which the European Commission stressed the need for a banking union, this paper intends to explore the complex process towards its establishment by looking at the EU institutional mechanisms and the legal aspects. In particular, the analysis will be based on two building blocks: (1) the Single Supervisory Mechanism, with a single supervisor at the heart of the banking union; and (2) the Single Resolution Mechanism as a new integrated resolution framework and a resolution fund to address the failure of banking institutions. The paper then assesses the next steps for a fully fledged banking union, necessary in order for this new instrument to lay the foundations for a genuine Economic and Monetary Union, thereby fostering financial and economic stability in the euro area and in the EU as a whole.
Topic:: Economics, Markets, Monetary Policy, and Financial Crisis
Political Geography:: Europe

136. Completing Europe – From the North-South Corridor to Energy, Transportation, and Telecommunications Union

Author:: Atlantic Council and CEEP
Publication Date:: 11-2014
Content Type:: Working Paper
Institution:: Atlantic Council
Abstract:: One of the greatest successes of our new century has been the progress made in unifying Europe. The accession of Central Europe's countries to the European Union (EU) has contributed to the end of division that wrought confrontations and conflicts. Yet this task is far from finished. Europe's economic woes, as well as new security challenges along the Union's eastern border add to the urgency of completing and consolidating the European integration project as part of our transatlantic vision of a Europe whole, free, and at peace.
Topic:: Economics, Energy Policy, Science and Technology, and Infrastructure
Political Geography:: Europe and Central Europe

137. Coordination of Social Security Schemes. The Case of SADC

Author:: Ockert Dupper
Publication Date:: 05-2014
Content Type:: Working Paper
Institution:: The Kolleg-Forschergruppe (KFG)
Abstract:: This paper will explore whether and to what extent the (legal) rules of coordination that originated and developed in the EU can be transposed to SADC – a region characterized by high levels of migration, weakly developed social security systems and the absence of suitable portability arrangements. The principle of coordination of social security is primarily aimed at eliminating restrictions that national social security schemes place upon the rights of migrant workers to such social security. One of the fundamental principles of social security coordination is that of portability, which is the ability to preserve, maintain, and transfer vested social security rights or rights in the process of being vested, independent of nationality and country of residence. The best practice around the world to ensure portability of social security entitlements consists of multilateral and bilateral social security agreements. These agreements originated and developed in the EU, and EU coordination arrangements arguably still represent the most sophisticated and developed system of its kind, and one that is worth emulating. In this paper, it is argued that any future attempts at coordinating social security schemes in SADC should start with employment injury schemes, which is the only social security scheme common to all SADC member states. The paper considers some of the issues that should be taken into account in designing social security agreements in SADC along the lines of the EU model.
Topic:: Economics, Human Rights, Human Welfare, Migration, and Regional Cooperation
Political Geography:: Europe

138. Locked In or Left Out? Transatlantic Trade Beyond Brussels and Washington

Author:: Sinan Ülgen
Publication Date:: 06-2014
Content Type:: Working Paper
Institution:: Carnegie Endowment for International Peace
Abstract:: Many countries are interested in the Transatlantic Trade and Investment Partnership (TTIP) that Brussels and Washington are negotiating. But the United States and the European Union (EU) began talks without devising a way to involve their main trade partners. This approach, understandable given the complexity of the negotiations, could produce a bilateral agreement that is difficult to multilateralize. To influence the negotiations, third countries interested in eventually joining TTIP should pursue an agenda centered on the accession mechanism, the elimination of nontariff barriers, and dispute settlement.
Topic:: Economics, Human Rights, and International Trade and Finance
Political Geography:: United States and Europe

139. Companions in Competitiveness: How France and the United States Can Help Each Other Succeed in the Twenty-first Century

Author:: Nicholas Dungan
Publication Date:: 01-2014
Content Type:: Working Paper
Institution:: Atlantic Council
Abstract:: Competitiveness encompasses all the factors that will serve to make a society, an economy, and a country successful in the globalized world of the twenty-first century. France and the United States rank among the most competitive countries overall, but both have seen their position decline in recent years in key attributes of competitiveness.
Topic:: Economics, International Cooperation, and Bilateral Relations
Political Geography:: United States, Europe, and France

140. Trade policy issues in the Wider Europe – that led to war and not yet to peace

Author:: Michael Emerson
Publication Date:: 07-2014
Content Type:: Working Paper
Institution:: Centre for European Policy Studies (CEPS)
Abstract:: This paper looks at the trade policy landscape of the EU and the wider Europe, with a focus on issues arising from the signature on 27 June 2014 of Deep and Comprehensive Free Trade Agreements (DCFTAs) between the EU and three East European countries (Georgia, Moldova and Ukraine), and actual or prospective issues relating to the customs union of Belarus, Russia and Kazakhstan (BRK), and the Eurasian Economic Union whose founding treaty was signed on 29 May 2014.The huge expansion of intercontinental free trade area negotiations currently underway, in which the EU is an active participant alongside much of the Americas and Asia, stands in contrast with Russia's choice to restrict itself to the Eurasian Economic Union, which is only a marginal extension of its own economy. Alone among the major economies in the world, Russia does not seek to integrate economically with any major economic bloc, which should be a matter of serious concern for Moscow. Within the wider Europe, the EU's DCFTAs with Ukraine, Moldova and Georgia are a major new development, but Russia now threatens trade sanctions against Ukraine in particular, the economic case for which seems unfounded and whose unilateral application would also impair the customs union.The Belarus-Russia-Kazakhstan customs union itself poses several issues of compatibility with the rules of the WTO, which in turn are viewed by the EU as an impediment to discussing possible free trade scenarios with the customs union, although currently there are far more fundamental political impediments to any consideration of such ideas. Nonetheless, this paper looks at various long-term scenarios, if only as a reminder that there could be much better alternatives to the present context of conflict around Ukraine.
Topic:: Economics, International Trade and Finance, and Treaties and Agreements
Political Geography:: Russia, Europe, Ukraine, Kazakhstan, and Asia

141. ECB Policy and Eurozone Fragility: Was De Grauwe Right?

Author:: Ana-Maria Fuertes, Elena Kalotychou, and Orkun Saka
Publication Date:: 06-2014
Content Type:: Working Paper
Institution:: Centre for European Policy Studies (CEPS)
Abstract:: Paul De Grauwe ' s fragility hypothesis states that member countries of a monetary union such as the eurozone are highly vulnerable to a self – fulfilling mechanism by which the efforts of investors to avoid losses from default can end up triggering the very default they fear. The authors test this hypothesis by applying an eclectic methodology to a time window around Mario Draghi ' s " whatever it takes " (to keep the eurozone on firm footing) pledge on 26 July 2012 . This pledge was soon followed by the announcement of the Outright Monetary Transactions (OMT) program me (the prospective and conditional purchase by the European Central Bank of sovereign bonds of eurozone countries having difficulty issuing debt) . The principal components of eurozone credit default swap spreads validate this choice of time frame . An event study reveals significant pre – announcement contagion emanating from Spain to Italy, Belgium, France and Austria. Furthermore, time – series regression confirms frequent clusters of large shocks affecting the credit default swap spreads of the four eurozone countries but solely during the pre – announcement period. The findings of this report support the fragility hypothesis for the eurozone and endorse the Outright Monetary Transactions programme.
Topic:: Economics, Foreign Exchange, International Trade and Finance, and Financial Crisis
Political Geography:: Europe, France, Belgium, and Italy

142. Trade Hallucination: Risks of Trade Facilitation and Suggestions for Implementation

Author:: Jeronim Capaldo
Publication Date:: 06-2014
Content Type:: Working Paper
Institution:: Global Development and Environment Institute at Tufts University
Abstract:: Official estimates tend to overstate the benefits of trade facilitation and ignore its costs. When all underlying assumptions are brought to light, expecting large gains appears unreasonable. At the same time, estimated employment benefits may easily turn into net losses.
Topic:: Economics, International Trade and Finance, and Labor Issues
Political Geography:: Europe

143. Labor Market Slack in the United Kingdom

Author:: David G. Blanchflower and David N. F. Bell
Publication Date:: 07-2014
Content Type:: Working Paper
Institution:: Peterson Institute for International Economics
Abstract:: This paper examines the amount of slack in the UK labor market and finds the downward adjustments made by the Monetary Policy Committee (MPC) to both unemployment and underemployment invalid. Without evidence to support its assessment of the output gap, the MPC reduces the level of unemployment based on its claim that long-term unemployment does not affect wages. The authors produce evidence to the contrary and present arguments on why the MPC's halving of the level of underemployment in the United Kingdom is inappropriate. Bell and Blanchflower set out arguments on why they believe the level of slack is greater than the MPC calibrates. Consistent with that is the fact that real wages in the United Kingdom continue to fall.
Topic:: Economics, Markets, and Labor Issues
Political Geography:: United Kingdom and Europe

144. The Scottish Doughnut: A safe and just operating space for Scotland

Author:: Katherine Trebeck and Malcolm Sayers
Publication Date:: 07-2014
Content Type:: Working Paper
Institution:: Oxfam Publishing
Abstract:: We live on a fragile planet which is under increased human stress, to the extent that we are transgressing several of the planetary boundaries as mapped out by the Stockholm Resilience Centre (SRC). We share this planet with over seven billion fellow human beings, too many of whom face extraordinary challenges in building a life free of poverty, indignity, powerlessness and fear. While a small number of people are using the most resources, simultaneously too many are unable to lead lives in which they can flourish and live with dignity.
Topic:: Economics, Environment, and Human Welfare
Political Geography:: United Kingdom and Europe

145. Trade policy issues in the Wider Europe – that led to war and not yet to peace

Author:: Michael Emerson
Publication Date:: 07-2014
Content Type:: Working Paper
Institution:: Centre for European Policy Studies (CEPS)
Abstract:: This paper looks at the trade policy landscape of the EU and the wider Europe, with a focus on issues arising from the signature on 27 June 2014 of Deep and Comprehensive Free Trade Agreements (DCFTAs) between the EU and three East European countries (Georgia, Moldova and Ukraine), and actual or prospective issues relating to the customs union of Belarus, Russia and Kazakhstan (BRK), and the Eurasian Economic Union whose founding treaty was signed on 29 May 2014. While the contrived collision between these projects has tragically induced Russia to break all the established international security norms by waging war against Ukraine, the present paper deals essentially with trade policy issues. The huge expansion of intercontinental free trade area negotiations currently underway, in which the EU is an active participant alongside much of the Americas and Asia, stands in contrast with Russia's choice to restrict itself to the Eurasian Economic Union, which is only a marginal extension of its own economy. Alone among the major economies in the world, Russia does not seek to integrate economically with any major economic bloc, which should be a matter of serious concern for Moscow. Within the wider Europe, the EU's DCFTAs with Ukraine, Moldova and Georgia are a major new development, but Russia now threatens trade sanctions against Ukraine in particular, the economic case for which seems unfounded and whose unilateral application would also impair the customs union. The Belarus-Russia-Kazakhstan customs union itself poses several issues of compatibility with the rules of the WTO, which in turn are viewed by the EU as an impediment to discussing possible free trade scenarios with the customs union, although currently there are far more fundamental political impediments to any consideration of such ideas. Nonetheless this paper looks at various long-term scenarios, if only as a reminder that there could be much better alternatives to the present context of conflict around Ukraine.
Topic:: Economics and International Trade and Finance
Political Geography:: Russia, America, Europe, Ukraine, Kazakhstan, Asia, and Georgia

146. The China-EU BIT: The emerging "Global BIT 2.0"?

Author:: Wenhua Shan and Lu Wang
Publication Date:: 08-2014
Content Type:: Working Paper
Institution:: Columbia Center on Sustainable Investment
Abstract:: Since China and the European Union (EU) announced their decision to negotiate a bilateral investment treaty (BIT) at the 14th China-EU Summit in February 2012, the two sides have engaged in two rounds of negotiations. If successful, it will be the first standalone EU BIT, a BIT between the world's largest developed economy and the world's largest developing economy, and will occupy a unique place in the history of BIT negotiations.
Topic:: Economics, International Trade and Finance, Bilateral Relations, and Foreign Direct Investment
Political Geography:: China, Europe, and Asia

147. Trade policy issues in the Wider Europe - that led to war and not yet to peace

Author:: Michael Emerson
Publication Date:: 07-2014
Content Type:: Working Paper
Institution:: Centre for European Policy Studies (CEPS)
Abstract:: This paper looks at the trade policy landscape of the EU and the wider Europe, with a focus on issues arising from the signature on 27 June 2014 of Deep and Comprehensive Free Trade Agreements (DCFTAs) between the EU and three East European countries (Georgia, Moldova and Ukraine), and actual or prospective issues relating to the customs union of Belarus, Russia and Kazakhstan (BRK), and the Eurasian Economic Union whose founding treaty was signed on 29 May 2014. While the contrived collision between these projects has tragically induced Russia to break all the established international security norms by waging war against Ukraine , the present paper deals essentially with trade policy issues . The huge expansion of intercontinental free trade area negotiation s currently underway, in which the EU is an active participant alongside much of the Americas and Asia, stands in contrast with Russia's choice to restrict itself to the Eurasian Economic Union, which is only a marginal extension of its own economy. Alone among the major economies in the world, Russia does not seek to integrate economically with any major economic bloc, which should be a matter of serious concern for Moscow. Within the wider Europe, the EU's DCFTAs with Ukraine, Moldova and Georgia are a major new development, but Russia now threatens trade sanctions against Ukraine in particular, the economic case for which seems unfounded and whose unilateral application would also impair the customs union. The Belarus-Russia-Kazakhstan customs union itself poses several issues of compatibility with the rules of the WTO, which in turn are viewed by the EU as an impediment to discussing possible free trade scenarios with the customs union, although currently there are far more fundamental political impediments to any consideration of such ideas. Nonetheless this paper looks at various long-term scenarios, if only as a reminder that there could be much better alternatives to the present context of conflict around Ukraine.
Topic:: International Relations, Diplomacy, Economics, and International Trade and Finance
Political Geography:: Russia, Europe, Ukraine, and Kazakhstan

148. Transatlantic Economic Agreements: Parsing CETA and TTIP

Author:: Patricia M. Goff
Publication Date:: 07-2014
Content Type:: Working Paper
Institution:: Centre for International Governance Innovation
Abstract:: In October 2013, Prime Minister Stephen Harper announced that the Government of Canada had reached a "political agreement" with the European Union on the Comprehensive Economic and Trade Agreement (CETA). The timing of Mr. Harper's statement was not coincidental. Evidence suggests that talks between Canada and the European Union are actually continuing several months after his announcement, if only on technical elements. Nonetheless, it seems the Government of Canada wanted to signal that a successful end to Canada-EU talks was in sight, just as talks between the United States and the European Union were getting under way towards the Trans-Atlantic Trade and Investment Partnership (TTIP). The Canadian government did not want to risk a redirection of European energies away from the Canadian negotiation toward their American counterparts.
Topic:: Economics and International Trade and Finance
Political Geography:: Europe and Canada

149. What Drove the Mid-2000s' Explosiveness in Alternative Energy Stock Prices? Evidence from US, European and Global Indices

Author:: Pierre Siklos, Martin T. Bohl, and Philipp Kaufmann
Publication Date:: 07-2014
Content Type:: Working Paper
Institution:: Centre for International Governance Innovation
Abstract:: Soaring prices in European alternative energy stocks and their subsequent tumble have attracted attention from both investors and academics. This paper extends recent research to an international setting and analyzes whether the explosive price behaviour of the mid-2000s was driven by rising crude oil prices and an overall bullish market sentiment. Inflation-adjusted US alternative energy stock prices do not exhibit signs of explosiveness. By contrast, we find strong evidence of explosive price behaviour for European and global sector indices, even after controlling for a set of explanatory variables. Interestingly, while the sector indices plunged with the outbreak of the global financial crisis, idiosyncratic components continued to rise and did not start to decline until after world equity markets had already begun to recover in 2009. This finding suggests a substantial revaluation of alternative energy stock prices in light of intensifying sector competition and shrinking sales margins, and casts some doubts on the existence of a speculative bubble. Nevertheless, this paper observes temporary episodes of explosiveness between 2005 and 2007 followed by rapid collapses, indicating the presence of some irrational exuberance among investors.
Topic:: Economics, Energy Policy, Oil, and Natural Resources
Political Geography:: United States and Europe

150. Energy efficiency: the ever neglected priority of the European energy strategy

Author:: Tania Zgajewski
Publication Date:: 05-2014
Content Type:: Working Paper
Institution:: EGMONT - The Royal Institute for International Relations
Abstract:: Energy saving has been a stated policy objective of the EU since the 1970s. Presently, the 2020 target is a 20% reduction of EU energy consumption in comparison with current projections for 2020. This is one of the headline targets of the European Energy Strategy 2020 but efforts to achieve it remain slow and insufficient. The aim of this paper is to understand why this is happening.
Topic:: Economics, Energy Policy, Regional Cooperation, and Reform
Political Geography:: Japan and Europe

151. International in Life, National in Death? Banking Nationalism on the Road to Banking Union

Author:: Martin Rhodes and Rachel A. Epstein
Publication Date:: 12-2014
Content Type:: Working Paper
Institution:: The Kolleg-Forschergruppe (KFG)
Abstract:: European states have a long history of banking sector nationalism. Control over credit allocation is believed to contribute to economic development and competitiveness goals, insulation from external economic shocks, and control over monetary policy. This paper explains the potentially dramatic loss in domestic control over banks created by the European Banking Union (EBU). First, we argue that ongoing liberalization in the global and European economies has made banking sector protectionism both more costly and conflictual. Second, we contend that because many of the biggest banks have internationalized their operations, they now prefer centralized European regulation and supervision. Third, supporting a modified neofunctionalist argument, we find that behind the sometimes frenetic intergovernmental bargaining in 2012-14, it is primarily the European Commission and the European Central Bank that have pushed Banking Union ahead. Supranational institutions have argued, with some success, that they have unique capacity to solve collective action and prisoners' dilemma problems. Contrary to accepted wisdom, Germany has not set or limited the Banking Union agenda to a great extent, in part because of its own internal divisions. Moreover, the Commission and the ECB have managed at critical junctures to isolate Germany to secure the country's assent to controversial measures.
Topic:: Economics, Government, and Monetary Policy
Political Geography:: Europe and Germany

152. Economic Policy Coordination in the Economic and Monetary Union: From Maastricht via the SGP to the Fiscal Pact

Author:: Jørgen Mortensen
Publication Date:: 08-2013
Content Type:: Working Paper
Institution:: Centre for European Policy Studies (CEPS)
Abstract:: This paper first takes a step backwards with an attempt to situate the recent adoption of the Treaty on Stability, Coordination and Governance in the Economic and Monetary Union in the context of discussions on the Stability and Growth Pact (SGP) and the 'Maastricht criteria', as fixed in the Maastricht Treaty for membership in the Economic and Monetary Union (EMU) in a longer perspective of the sharing of competences for macroeconomic policy-making within the EU. It then presents the main features of the new so-called 'Fiscal Compact' and its relationship to the SGP and draws some conclusions as regards the importance and relevance of this new step in the process of economic policy coordination. It concludes that the Treaty on Stability, Coordination and Governance in the Economic and Monetary Union does not seem to offer a definitive solution to the problem of finding the appropriate budgetary-monetary policy mix in EMU, which was already well identified in the Delors report in 1989 and regularly emphasised ever since and is now seriously aggravated due to the crisis in the eurozone. Furthermore, implementation of this Treaty may under certain circumstances contribute to an increase in the uncertainties as regards the distribution of the competences between the European Parliament and national parliaments and between the former and the Commission and the Council.
Topic:: Economics, Markets, Regional Cooperation, Treaties and Agreements, and Monetary Policy
Political Geography:: Europe

153. When do adults learn? A cohort analysis of adult education in Europe

Author:: Anna-Elisabeth Thum, Miroslav Beblavý, and Galina Potjagailo
Publication Date:: 05-2013
Content Type:: Working Paper
Institution:: Centre for European Policy Studies (CEPS)
Abstract:: Adult learning is seen as a key factor for enhancing employment, innovation and growth, and it should concern all age cohorts. The aim of this paper is to understand the points in the life cycle at which adult learning takes place and whether it leads to reaching a medium or high level of educational attainment. To this end we perform a synthetic panel analysis of adult learning for cohorts aged 25 to 64 in 27 European countries using the European Labour Force Survey. We find, as previous results suggest, that a rise in educational attainment as well as participation in education and training happens mostly at the age range of 25-29. However, investment across the life cycle by cohorts older than 25 still occurs: in most countries in our sample, participation in education and training as well as educational attainment increases observably across all cohorts. We also find that the decline with age slows down or is even reversed for older cohorts, for both participation in education and educational attainment. Finally, we can identify a Nordic model in which adult learning is achieved through participation in education and training, a Central European model in which adult learning occurs in the form of increasing educational attainment and a liberal model in which both approaches to adult learning are observable.
Topic:: Economics, Education, Markets, and Labor Issues
Political Geography:: Europe

154. The Greek Debt Restructuring: An Autopsy

Author:: Jeromin Zettelmeyer, Christoph Trebesch, and Mitu Gulati
Publication Date:: 08-2013
Content Type:: Working Paper
Institution:: Peterson Institute for International Economics
Abstract:: The Greek debt restructuring of 2012 stands out in the history of sovereign defaults. It achieved very large debt relief— over 50 percent of 2012 GDP—with minimal financial disruption, using a combination of new legal techniques, exceptionally large cash incentives, and official sector pressure on key creditors. But it did so at a cost. The timing and design of the restructuring left money on the table from the perspective of Greece, created a large risk for European taxpayers, and set precedents—particularly in its very generous treatment of holdout creditors—that are likely to make future debt restructurings in Europe more difficult.
Topic:: Debt, Economics, Monetary Policy, and Financial Crisis
Political Geography:: Europe and Greece

155. How to Measure Underemployment?

Author:: David G. Blanchflower and David N. F. Bell
Publication Date:: 08-2013
Content Type:: Working Paper
Institution:: Peterson Institute for International Economics
Abstract:: One of the factors that may inhibit reductions in unemployment as the economy recovers is the extent to which existing workers would like to work more hours and employers may prefer to let them work longer hours before making new hires. This phenomenon suggests that the unemployment rate does not capture the full extent of excess capacity in the labor market. But how should it be measured? In this paper we argue that the United States does not have the necessary statistical tools to calibrate this form of underemployment. We describe an index that captures the joint effects of unemployment and underemployment and provides a more complete picture of labor market excess capacity. We show how this index can be implemented using British data and describe its evolution over the Great Recession. Comparisons of our index with unemployment rates suggest that unemployment rates understate differences in labor market excess capacity by age group and overstate differences by gender. We also show that being unable to work the hours that one desires has a negative effect on well-being. Finally, we recommend that the Current Population Survey conducted by the US Bureau of Labor Statistics might be extended to enable the construction of an equivalent US index.
Topic:: Economics, International Trade and Finance, Markets, and Labor Issues
Political Geography:: United States and Europe

156. Avrupa'da Seçmen Davranışı: Bölgesel Farklılıkların Önemi

Author:: Nazlı Çağın Bilgili
Publication Date:: 03-2013
Content Type:: Working Paper
Institution:: Global Political Trends Center (GPoT)
Abstract:: Elections are central elements of democratic systems as they provide the public with the opportunity – with some restrictions established by legal arrangements such as quotas – to make their voices heard. In other words, it is through election results that we learn a great deal about the social and political circumstances in a country. This paper follows the electoral trends in European countries since the beginning of the 1990s as far as the data makes it possible. In order to create a comprehensive analysis, turnout rates, voter preferences and other major determinants shaping preferences – whether influential economic or identity factors – are considered. Europe is defined, in this research, as all of the EU member states, making a highly complicated and heterogeneous collection. As the trends in these different countries can be expected to diverge, a regional comparison between Western, Northern, Southern and Eastern Europe is provided so that the similar and different electoral trends in these regions are presented clearly.
Topic:: Democratization, Economics, Political Economy, and Regional Cooperation
Political Geography:: Europe

157. Güney Avrupa'da Ekonomik Kriz ve Toplumsal Hareketler

Author:: Burak Cop
Publication Date:: 02-2013
Content Type:: Working Paper
Institution:: Global Political Trends Center (GPoT)
Abstract:: The southern European countries are those who have been affected the most by the EU sovereign debt crisis. However, compared with Greece and Spain, Italy and Portugal are in relatively better positions in terms of their debt/GDP rate and unemployment figures. There has been a strong popular reaction against the austerity measures in Greece, a country where leftist parties and trade unions have been traditionally strong. Due to the miserable conditions of the economy, the Greek government has been prevented from taking the publics demands into account. It is important to note that the political situation in Greece is very unstable leading to the potential relaxing of the austerity measures. There is no such instability in Spain and Portugal, making the probability of the relaxation of austerity measures unlikely, especially in Spain. Italy has the same potential for political instability as does Greece, and given that it is a country with relatively better conditions, in comparison with the others, some relaxation of the austerity measures may be expected if the centre-left coalition comes to power.
Topic:: Debt, Economics, Global Recession, Financial Crisis, Governance, and Reform
Political Geography:: Europe, Greece, and Spain

158. SOSYAL DEMOKRASİ KÜRESEL ÇEVRE İÇİN BİR SİYASAL ALTERNATİF OLABİLİR Mİ?

Author:: Yunus Emre and Çağla Gül Çağla Gül
Publication Date:: 01-2013
Content Type:: Working Paper
Institution:: Global Political Trends Center (GPoT)
Abstract:: Social democracy was born as a reaction to the social problems created by capitalist modernization in the nineteenth century. It had a central role in the making of the modern European societies. During the twentieth century, it had immense organizational successes and election victories transforming political relationships in those societies. In the 1970s, orientation towards social democracy increased within many of the countries in the global periphery. Today, social democracy prevails as an influential and successful political and social power system in these periphery countries. This paper seeks to answer whether social democracy should continue to be a model for other countries in the periphery.
Topic:: Democratization, Economics, Political Economy, and Governance
Political Geography:: Europe

159. Assessing the Single Supervisory Mechanism: Passing the point of no return for Europe's Banking Union

Author:: Stijn Verhelst
Publication Date:: 06-2013
Content Type:: Working Paper
Institution:: EGMONT - The Royal Institute for International Relations
Abstract:: Europe's financial and sovereign debt crises have become increasingly interconnected. In order to break the negative feedback loop between the two, the EU has decided to create a common supervisory framework for the banking sector: the Single Supervisory Mechanism (SSM). The SSM will involve a supervisory system including both the national supervisors and the European Central Bank (ECB). By endowing the ECB with supervisory authority over a major part of the European banking sector, the SSM's creation will result in a shake-up of the way in which the European financial sector is being supervised. Under the right circumstances, this could be a major step forward in addressing Europe's interconnected crises.
Topic:: Debt, Economics, Regional Cooperation, Monetary Policy, and Financial Crisis
Political Geography:: Europe

160. Money for Structural Reforms in the Eurozone:making sense of contractual Arrangements

Author:: Xavier Vanden Bosch
Publication Date:: 05-2013
Content Type:: Working Paper
Institution:: EGMONT - The Royal Institute for International Relations
Abstract:: Both the Commission's proposal for a 'Competitiveness and Convergence Instrument' and the 'contractual arrangement' presented by President Van Rompuy share a common concept: associating EU money with national structural reforms under a binding arrangement.
Topic:: Economics, Markets, Regional Cooperation, Labor Issues, Monetary Policy, and Reform
Political Geography:: Europe

161. Templates for Trade: Change, Persistence and Path Dependence in U. S. and EU Preferential Trade Agreements

Author:: Ali Arbia
Publication Date:: 09-2013
Content Type:: Working Paper
Institution:: The Kolleg-Forschergruppe (KFG)
Abstract:: Over the last two decades, Preferential Trade Agreements (PTAs) proliferated through the international trading system. PTAs created a web of rules paralleling and extending the system of the World Trade Organization (WTO). PTAs are an increasingly dominant feature of the international trading system, adding to a steadily increasing complexity. Their content is rarely studied systematically across agreements, and the mechanisms leading to their genesis are little understood. It is typically assumed that actors like the European Union (EU) and the United States (U. S.) work off a template when negotiating PTAs. Some argue that this allows them, amongst others, to impose a regulatory regime. This working paper attempts to put this claim to the test. Using diffusion theory as framework, it analyzes PTAs signed by the EU, the U. S. and their regional trading partners. Understanding the use of templates will help negotiating parties to assess the margin of maneuver when negotiating PTAs with the EU and the U. S. as well as the rigidity of their mandate. The analysis is conducted on a regional and a domestic level using aggregated data on PTA content and a qualitative assessment of selected PTA provisions (anti-corruption, environment and cultural cooperation). The study finds that the flexibility of these mandates is considerable and that templates, if used at all, can change substantially over time.
Topic:: Economics, International Trade and Finance, Treaties and Agreements, and Governance
Political Geography:: United States and Europe

162. The EU Beyond the Crisis: The Unavoidable Challenge of Legitimacy

Author:: Richard Youngs
Publication Date:: 10-2013
Content Type:: Working Paper
Institution:: Carnegie Endowment for International Peace
Abstract:: The euro crisis has mobilized the masses and unleashed vitally important debates about changing the model of European integration, both economically and politically. Yet, as European governments deepen economic cooperation and the crisis appears to have calmed, European Union (EU) member states feel increasingly confident that fundamental political changes are not necessary. This is a dangerously short-sighted calculation. To build a truly democratic EU, citizens need to have a greater voice in decision making.
Topic:: Debt, Economics, Markets, Regional Cooperation, Monetary Policy, Financial Crisis, and Reform
Political Geography:: Europe

163. Empirical Investigation of Declining Childbirth: Psychosocial and Economic Conditions in Japan

Author:: Tetsuji Yamada, Chia-Ching Chen, Chie Hanaoka, and Seiritsu Ogura
Publication Date:: 08-2013
Content Type:: Working Paper
Institution:: Walter H. Shorenstein Asia-Pacific Research Center
Abstract:: Background: For the past two decades, more and more women in certain European countries, Japan, and the United States are giving birth to their first child at a considerably later age than ever before. It remains unclear as to what extent this age-related general fertility decline is affected by changing social and cultural norms. Method: The Global Centers of Excellence Survey was conducted by Osaka University in Japan (n=5313) in 2009. Multivariate regression analyses were conducted to examine the impact of psychosocial norms, cultural differences, and economic conditions on the perception of childbearing. Results: The findings suggest that a subjective measure of happiness has a significant influence on childbearing. A society with income inequalities between classes discourages childbearing. It is observed that women's higher labor force participation generates a negative impact on motherchild relations which causes discouragement of childbearing. A higher female labor force participation stemmed from a transition of a traditional society into a modern and marketoriented society discourages childbearing. Conclusions/implications: A woman's decision to delay childbearing is based on her perception of psychosocial norms with surrounding economic environment and her own value of opportunity in the market oriented society. Childbearing also imposes psycho-economic burdens on the working population under mix of a traditional, patriarchal society, and a modern market oriented framework. Childbearing incentives could be a strategic policy to encourage positive attitudes of childbearing in general and proper welfare policy, labor law(s), employment conditions, and social security system for a working mother with a child or children.
Topic:: Economics, Gender Issues, Health, Poverty, Social Stratification, and Labor Issues
Political Geography:: United States, Japan, Europe, Israel, and Asia

164. How EU sanctions work: a new narrative

Author:: Francesco Giumelli
Publication Date:: 05-2013
Content Type:: Working Paper
Institution:: European Union Institute for Security Studies
Abstract:: The European Union has devoted growing attention to sanctions since the entry into force of the Maastricht Treaty.1 In total, the Council has imposed Common Foreign and Security Policy (CFSP) sanctions targeting countries, economic sectors, groups, individuals and entities on 27 different occasions. The novelty in the area of sanctions is that targets are not only states, as in the recent cases of Iran and Syria, but they are also individuals and non-state entities, e.g. anti-terrorist lists, President Robert Mugabe and his associates, and several companies connected with the military junta in Burma/Myanmar. Additionally, the contexts in which sanctions are utilised can be diverse, ranging from the protection of human rights to crisis management and non-proliferation. Despite the fact that the effectiveness of sanctions has been much debated, the EU has developed a sanctioning policy and intensified its adoption of sanctions. Sanctions were traditionally seen as a way to impose economic penalties as a means of extracting political concessions from targets, but EU sanctions do not always impose a cost nor do they always seek to induce behavioural change. To this extent, a new narrative may be needed.
Topic:: Foreign Policy, Economics, Human Rights, International Cooperation, International Law, and Sanctions
Political Geography:: Europe, Burma, and Myanmar

165. The Eastern Partnership—It Is High Time to Start a Real "Partnership"

Author:: Paweł Dariusz Wiśniewski
Publication Date:: 11-2013
Content Type:: Working Paper
Institution:: Carnegie Endowment for International Peace
Abstract:: The European Union's (EU's) Eastern Partnership, which aims to deepen cooperation between the EU and its Eastern European neighbors, must be modernized. Partner states and the EU have to acknowledge their own failures instead of playing a “blame game” and work together to make the partnership a success. If the Eastern Partnership initiative fails, both sides—along with Russia, whose role is key—will be responsible.
Topic:: Economics, Regional Cooperation, and Treaties and Agreements
Political Geography:: Europe

166. The Management and Use of Natural Resources and their Potential for Economic and Social Development in the Mediterranean

Author:: Vanessa Ushie
Publication Date:: 10-2013
Content Type:: Working Paper
Institution:: Istituto Affari Internazionali
Abstract:: In the framework of the IAI-OCP Policy Center project this paper offers a conceptual framework to examine natural resource management in Turkey, Morocco and Italy and its implications for social and economic development. It recognizes the multiplicity of actors involved in natural resource management at the local, national and global level. It then proceeds by 1) advancing a definition of natural resources to be used in the context of this project; 2) highlighting relevant emerging issues in the empirical debates on natural resource management within economics and politics; 3) developing a series of indicators aimed at assessing the dimensions of the management and use of natural resources. In general, this conceptual framework adopts a flexible and plural approach that reflects the multidisciplinary nature of natural resource management, and recognizes the importance of country-specific factors in the relationship between natural resource management and socio-economic development.
Topic:: Development, Economics, Natural Resources, and Sociology
Political Geography:: Europe, Turkey, North Africa, Italy, and Morocco

167. Extending Working Life in Finland

Author:: Anna-Elisabeth Thum and Marten von Werder
Publication Date:: 11-2013
Content Type:: Working Paper
Institution:: Centre for European Policy Studies (CEPS)
Abstract:: This report reviews national and private initiatives to allow the elderly to continue their participation in the Finnish labour market and provides an analysis of the labour market and living conditions of seniors. We are interested in how those over 50 can be engaged in various forms of employment and lifelong learning. We find strong evidence that Finland generally provides good institutional conditions for active ageing. The quick and early ageing process was tackled by the fundamental pension reform that already prolonged retirement substantially and will probably facilitate later retirement as the attitudes concerning retirement change. On the other hand, Finland still seems to lack behind the other Nordic welfare states, has considerable problems in providing the same health conditions to low educated people in physically demanding occupations and could - with respect to family pension in particular - invest further effort in reforming the pension system. While many of the reforms Finland has conducted seem to be favourable and transferable to other European countries that still face the steepest phases of ageing in their societies, a reluctance towards changing attitudes that we observe in Finland, shows that organizing active ageing is a long-term project.
Topic:: Demographics, Economics, Health, and Labor Issues
Political Geography:: Europe and Finland

168. Extending Working Life in Belgium

Author:: Anna-Elisabeth Thum, Nicolas Contreras, and Elisa Martellucci
Publication Date:: 11-2013
Content Type:: Working Paper
Institution:: Centre for European Policy Studies (CEPS)
Abstract:: This report aims at understanding how persons aged 50 years and older are and can be integrated into the working society in Belgium. We are interested in how people in this age group can be induced to engage in various forms of employment and lifelong learning. Based on secondary literature, descriptive databases as well as interviews with experts and focus groups, we find that the discussion on active ageing in Belgium is well advanced with numerous contributions by academics, stakeholders, social partners, the public administration and interest groups. The wish to retire at 60 is widely shared but at the same time the majority of Belgium's elderly are able and would be willing to work under specific conditions. Therefore, we recommend that Belgium should invest in more flexible systems including a revision of the tax scheme, such as the part-time retirement system proposed by the insurance company Delta Lloyd. An equally relevant recommendation would be to ensure that public employment agencies, employers and agencies that provide training encourage all workers to work and learn regardless of their age.
Topic:: Demographics, Economics, International Trade and Finance, and Labor Issues
Political Geography:: Europe and Belgium

169. Proposal for a Stabilisation Fund for the EMU

Author:: Bernard Delbecque
Publication Date:: 10-2013
Content Type:: Working Paper
Institution:: Centre for European Policy Studies (CEPS)
Abstract:: This paper argues that it should be possible to complement Europe's Economic and Monetary Union with an insurance-type shock absorption mechanism to increase the resilience of member countries to economic shocks and reduce output volatility. Such a mechanism would neither require the establishment of a central authority, nor would it lead to permanent transfers between countries. For this mechanism to become a reality, however, it would be necessary to overcome certain technical problems linked to the difficulty of anticipating correctly the position of an economy in the business cycle.
Topic:: Economics, Markets, and Monetary Policy
Political Geography:: Europe

170. Tax, Infrastructure, Anti-Corruption, Energy and the G20

Author:: Stephen Grenville, Mike Callaghan, Hugh Jorgensen, Marty Harris, Daniela Strube, Maria Monica Wihardja, and Philip Anderson
Publication Date:: 10-2013
Content Type:: Working Paper
Institution:: Lowy Institute for International Policy
Abstract:: This issue of the Monitor deals with four topics: long-term financing for investment, combating tax evasion and avoidance, fighting corruption and global energy governance. Consistent with the approach taken in previous issues of the Monitor, the question explored within each topic is 'how can the G20 add value?'
Topic:: Climate Change, Corruption, Economics, Energy Policy, International Cooperation, International Trade and Finance, and Infrastructure
Political Geography:: Europe

171. Financial regulation and the G20

Author:: Hugh Jorgensen, Mike Callaghan, Stephen Pickford, Richard Gray, Steven Bardy, Graham Hodges, and Ross Buckley
Publication Date:: 07-2013
Content Type:: Working Paper
Institution:: Lowy Institute for International Policy
Abstract:: This issue of the Monitor canvases the role of the G20 in strengthening financial regulation. It contains articles by Hugh Jorgensen (Lowy Institute), Stephen Pickford (Chatham House), Richard Gray (Westpac), myself, Steven Bardy (Australian Securities and Investment Commission), Ross Buckley (University of New South Wales) and Graham Hodges (ANZ). It also includes a summary of the discussion at a regional 'Think 20' seminar recently held at the Lowy Institute.
Topic:: Economics, International Organization, International Trade and Finance, Financial Crisis, and Reform
Political Geography:: United States and Europe

172. Trade and the G20

Author:: John Ravenhill, Mark P Thirlwell, Mike Callaghan, Peter W. Gallagher, and Brett Williams
Publication Date:: 06-2013
Content Type:: Working Paper
Institution:: Lowy Institute for International Policy
Abstract:: This issue of the G20 Monitor is devoted to the topic of international trade and the role of the G20. Over the coming months, the Monitor will be covering in detail a number of issues that are, or could be, on the G20 agenda. For example, over the next few months there will be an issue on 'Financial regulation and the G20' and another on 'Development and the G20'. The question we are asking on each issue is 'where can the G20 add value?'
Topic:: Economics, International Trade and Finance, Treaties and Agreements, and Infrastructure
Political Geography:: United States, China, and Europe

173. Politics and Economics in Putin's Russia

Author:: Stephen J. Blank
Publication Date:: 12-2013
Content Type:: Working Paper
Institution:: The Strategic Studies Institute of the U.S. Army War College
Abstract:: The United States Army War College educates and develops leaders for service at the strategic level while advancing knowledge in the global application of Landpower.
Topic:: Security, Political Violence, and Economics
Political Geography:: Russia, United States, Europe, and Asia

174. Eurocriticism: The Eurozone Crisis and Anti-Establishment Groups in Southern Europe

Author:: Nathalie Tocci, Thanos Dokos, Eleonora Poli, Chiara Rosselli, and Eduard Soler i Lech
Publication Date:: 12-2013
Content Type:: Working Paper
Institution:: Istituto Affari Internazionali
Abstract:: The Eurozone crisis and the ensuing public disaffection towards what many view as deficient EU institutions and policies have resulted in a surge of euroscepticism across member states. Although euroscepticism is not a new phenomenon, the rise of mass anti- establishment movements notably in southern Europe is. Despite their different political and structural features, Five Star Movement in Italy, Syriza in Greece and several social movements sprung from the Indignados in Spain have recently become key actors in their national political arena by opposing, inter alia, EU-imposed austerity. Yet these movements are not anti-EU in toto; while they criticize what they view as the EU's lack of democracy and rigid economic policies, they are not opposed to the EU integration project as such. While a fine line distinguishes Euro-scepticism from Euro-criticism, provided such distinction is made, the critique of these movements could be galvanized into a constructive force for a more integrated EU political space.
Topic:: Debt, Economics, International Trade and Finance, Financial Crisis, and Reform
Political Geography:: Europe

175. Regional Blocs, Transnational Actors and Interest Mediation: The Cases of Mexico and Turkey

Author:: Isik Özel
Publication Date:: 11-2013
Content Type:: Working Paper
Institution:: The Kolleg-Forschergruppe (KFG)
Abstract:: This working paper explores the processes in which accession to different regional blocs has affected the ways the state interacts with societal actors, along with the interest representation and mediation models in both member and accession countries. Focusing on Turkey and Mexico, two upper-middle-income countries situated on the fringes of major powers and integrated into the regional blocs led by those, the paper examines the differential impact of the European Union (EU) and the North American Free Trade Agreement (NAFTA) on the organization and mediation of business interests; the ways in which these interests are incorporated into policy-making; and the processes of social dialogue. Taking into consideration the fundamental differences between these two regionalisms, it looks into both direct and indirect mechanisms with respect to the influence of regional-level actors on domestic actors and institutions. Maintaining that the impact of regional blocs cannot be easily isolated from that of international, transnational actors and processes, the paper scrutinizes the respective roles of international actors and transnational networks which, at times, have become more influential than the regional blocs in bringing about major institutional changes at the domestic level. Thus, it sheds light on processes of comparative regionalization and their varying influences on distinct polities, which is usually combined and even furthered or, rather, obstructed by the influences of transnational, international and global forces, along with domestic actors and institutions.
Topic:: Economics and International Trade and Finance
Political Geography:: Europe, India, and Mexico

176. The Hyperglobalization of Trade and Its Future

Author:: Arvind Subramanian and Martin Kessler
Publication Date:: 07-2013
Content Type:: Working Paper
Institution:: Peterson Institute for International Economics
Abstract:: This paper describes seven salient features of trade integration in the 21st century: Trade integration has been more rapid than ever (hyperglobalization); it is dematerialized, with the growing importance of services trade; it is democratic, because openness has been embraced widely; it is criss-crossing because similar goods and investment flows now go from South to North as well as the reverse; it has witnessed the emergence of a mega-trader (China), the first since Imperial Britain; it has involved the proliferation of regional and preferential trade agreements and is on the cusp of mega-regionalism as the world's largest traders pursue such agreements with each other; and it is impeded by the continued existence of high barriers to trade in services. Going forward, the trading system will have to tackle three fundamental challenges: In developed countries, the domestic support for globalization needs to be sustained in the face of economic weakness and the reduced ability to maintain social insurance mechanisms. Second, China has become the world's largest trader and a major beneficiary of the current rules of the game. It will be called upon to shoulder more of the responsibilities of maintaining an open system. The third challenge will be to prevent the rise of mega-regionalism from leading to discrimination and becoming a source of trade conflicts. We suggest a way forward—including new areas of cooperation such as taxes—to maintain the open multilateral trading system and ensure that it benefits all countries.
Topic:: Economics, Emerging Markets, Globalization, and International Trade and Finance
Political Geography:: Europe, Asia, and North America

177. Asian and European Financial Crises Compared

Author:: Edwin M. Truman
Publication Date:: 10-2013
Content Type:: Working Paper
Institution:: Peterson Institute for International Economics
Abstract:: The European and Asian financial crises are the two most recent major regional crises. This paper compares their origins and evolution. The origins of the two sets of crises were different in some respects, but broadly similar. The two sets of crises also shared similarities in their evolution, but here the differences were more significant. The European crisis countries received more external financial support, despite the fact that they involved more solvency issues while the Asian crises involved more liquidity issues. On balance, the reform programs in the European crises were less demanding and rigorous than in the Asian crises. Partly as a consequence, the negative impacts on the global economy have been larger. I draw three lessons from this analysis: First, history will repeat itself; there will be other external financial crises. Second, other countries have a stake in appropriate crisis management. Third, the IMF and other countries were mistaken in treating the European crises as individual country crises rather than as a crisis for the euro area as a whole that demanded policy conditionality on all members of the euro area.
Topic:: Economics, International Trade and Finance, International Monetary Fund, and Financial Crisis
Political Geography:: Europe and Asia

178. Education in Member State Submissions under the EU Framework for National Roma Integration Strategies

Author:: Eben Friedman
Publication Date:: 12-2013
Content Type:: Working Paper
Institution:: European Centre for Minority Issues
Abstract:: The European Union's (EU) strategy for recovery from the economic crisis that began at the end of the first decade of the 2000s is organized around three priorities: smart growth, sustainable growth, and inclusive growth (European Commission 2010: 9). While the three types of growth are presented as mutually reinforcing, explicit attention to minorities in general and to Roma in particular comes only under the heading of inclusive growth, defined as "empowering people through high levels of employment, investing in skills, fighting poverty and modernising labour markets, training and social protection systems so as to help people anticipate and manage change, and build a cohesive society" (European Commission 2010: 17). As part of the "European Platform against Poverty" planned in the area of inclusive growth, the European Commission (EC) calls on Member States "[t]o define and implement measures addressing the specific circumstances of groups at particular risk (such as one-parentamilies, elderly women, minorities, Roma, people with a disability and the homeless" as a means of "rais[ing] awareness and recognis[ing] the fundamental rights of people experiencing poverty and social exclusion, enabling them to live in dignity and take an active part in society" (European Commission 2010: 19).
Topic:: Economics, Education, Human Rights, Governance, and Minorities
Political Geography:: Europe

179. The EEA and Norway Grants: Source of Norwegian influence or soft power?

Author:: Rieker Pernille and Tom O. Johnsen
Publication Date:: 02-2013
Content Type:: Working Paper
Institution:: Norwegian Institute of International Affairs
Abstract:: For nearly 20 years, Norway has contributed financially to less wealthy EU countries. From €120 million (1994–1998) these contributions have reached nearly €1.8 billion for the period 2009–2014. What exactly does Norway get in return? Should the Grants simply be understood as an act of solidarity? Or do the financial contributions serve as a source of soft power providing increased influence in the EU? The objective of this article is not to assess whether the Grants have helped to reduce economic and social disparities, nor to explain why the Grants emerged. We focus on how and to what extent Norway has had and can have political advantage from these contributions, in relations with the EU and the beneficiary states. This article serves as a case-study examining the relation between a policy (the Grants) and soft power.
Topic:: Economics, Political Economy, Regional Cooperation, Power Politics, and Foreign Aid
Political Geography:: Europe

180. Inward FDI in Ireland and its policy context, 2012

Author:: Louis Brennan and Rakhi Verma
Publication Date:: 03-2013
Content Type:: Working Paper
Institution:: Columbia Center on Sustainable Investment
Abstract:: Despite the global financial and economic crises and a sharp downturn in the domestic economy between 2008 and 2009, Ireland managed to attract large inflows of foreign direct investment (FDI) in 2010. Inward FDI (IFDI) flows in 2010 were at a similar level to those in 2009, the second highest in Ireland's FDI history. However in 2011, there was a decline in such flows. While Ireland's economy has been greatly affected by the global crisis, Irish government initiatives have further fostered the country's attractiveness as an investment location for the world's firms. All indications are that Ireland's IFDI performance will continue to surpass that of most countries into the near future.
Topic:: Economics, International Trade and Finance, Markets, and Foreign Direct Investment
Political Geography:: Europe and Ireland

181. Inward FDI in Germany and its policy context, 2012

Author:: Thomas Jost
Publication Date:: 04-2013
Content Type:: Working Paper
Institution:: Columbia Center on Sustainable Investment
Abstract:: In 2011 and the first half of 2012, inward FDI (IFDI) flows to Germany continued to be relatively strong. Germany attracte market-seeking MNEs, as its economy showed remarkable economic growth despite the ongoing problems in many other countries of the Eurozone. In the second half of 2012, IFDI flows turned sharply negative, declining for the year as a whole to only US$ 7 billion, compared with US$ 49 billion in 2011. This decline reflects the difficult financial situation of many companies, including banks in the Eurozone, and could also dampen inflows in 2013. In the longer-term, Germany could profit again from rising FDI as its economy has successfully implemented reforms over the past decade, and the German Government has continued to keep its investment policy regime open.
Topic:: Economics, International Trade and Finance, Markets, and Foreign Direct Investment
Political Geography:: United States, Europe, and Germany

182. The United States, Russia, and Europe: Trilateral Security Dialogue in the Absence of Strategic Partnership

Author:: Isabelle Francois
Publication Date:: 09-2013
Content Type:: Working Paper
Institution:: Atlantic Council
Abstract:: The past twenty years have been marked by a series of setbacks and disappointments in the US-European-Russian dialogue, despite regular attempts to develop a strategic partnership. In this cyclical relationship, 2012 was a low point in Western relations with Russia, from the calculated absence of President Vladimir Putin at the NATO summit in Chicago to the Russian ban on American adoptions of Russian orphans, and the US reaction to the Sergei Magnitsky case. The year 2013 could have been the beginning of an upswing in the trilateral dialogue. In April, US Secretary of State John Kerry and Russian Foreign Minister Sergey Lavrov met on the margins of the G8 foreign ministers' gathering in London. At the same time, US National Security Advisor Tom Donilon called on Putin in Moscow, where he hand-delivered a letter from President Barack Obama detailing potential areas of cooperation. A series of meetings between Russian and American officials throughout the summer saw a new diplomatic push to reframe the US–Russia relationship in the run-up to the Group of Eight meeting in June and the G20 meeting in September 2013. However, the Edward Snowden affair and Obama's subsequent decision to cancel the planned September meeting with Putin in light of insufficient progress on bilateral issues point to a pause in the relationship.
Topic:: International Relations and Economics
Political Geography:: Russia, United States, America, and Europe

183. The Europe We Would Like to Inherit: Toward a Visionary New Pragmatism

Author:: Dustin Dehez, Muddassar Ahmed, Nafeez Mosaddeq Ahmed, Spela Kranjc, and Ivo Sobral
Publication Date:: 07-2013
Content Type:: Working Paper
Institution:: Atlantic Council
Abstract:: Europe urgently needs to move forward on a number of crucial reforms simultaneously. To face the challenges of the recession, we need better economic integration. The crisis of the Euro zone is not only a debt crisis. What Europe is facing is a multitude of different crises, of which the debt crises in Greece, Cyprus, Spain, and Italy are only a small part. All European countries have accumulated huge debts, their social security models are facing an inevitable demographic challenge of enormous proportions. The conventional crisis management response—austerity—has failed to create a foundation for future economic stability. To survive, Europe needs to rethink the very foundations of its economic policies for a population that is older and a Europe more fractured. Europe needs to open itself up to immigration, foster regulation and integration of financial markets, overhaul social security structures set up decades ago, galvanize productive investment in new post-carbon industries that will create jobs and spur technological innovation, and invest in a security sector that is capable of projecting stability.
Topic:: Foreign Policy, Development, Economics, Politics, and Reform
Political Geography:: Europe, Greece, Spain, Italy, and Cyprus

184. Shadow Banking and Systemic Risk in Europe and China

Author:: Sara Hsu, Jianjun Li, and Yanzhi Qin
Publication Date:: 02-2013
Content Type:: Working Paper
Institution:: City Political Economy Research Centre (CITYPERC), University of London
Abstract:: We compare the European and Chinese shadow banking systems. While the European shadow banking system is better developed than the Chinese shadow banking system, herd behavior and other factors in European markets create systemic risk, which contributed in part to the financial crisis. Dispersion of risk across the "under-developed" shadow banking system in China has led to some cases of localized, concentrated risk, but not to systemic risk. We discuss proposed European shadow banking regulation and its implications for systemic risk, and discuss what lessons China might glean from such policies. We also discuss what lessons China's diverse and systemically uncoordinated shadow banking sector might provide for Europe.
Topic:: Economics, Regulation, Risk, and Shadow Banking
Political Geography:: China, Europe, and Asia

185. Do places of worship affect housing prices? Evidence from Germany

Author:: Sebastian Brandt, Wolfgang Maennig, and Felix J. Richter
Publication Date:: 10-2013
Content Type:: Working Paper
Institution:: Chair for Economic Policy, University of Hamburg
Abstract:: Using hedonic pricing models, this paper analyzes the impact of places of worship on the prices of adjacent condominiums in Hamburg, Germany. This is the first study on this subject to have been conducted outside the United States. It is also the first work to examine the externalities of places of worship of all five world religions. Furthermore, it is the first study that analyzes the effect of bell ringing on the adjacent residential property prices. Controlling for spatial dependence and by using potentiality variables positive externalities of places of worship within a radius of 1,000m were identified. Compared to properties beyond this threshold, price premiums of 4.8% were detected for condominiums at distances of 100m to 200m to the next place of worship. The results also show that the positive externalities near mosques do not differ from those of places of worship of other religions and that the positive effect of churches continues to be felt even after they have been deconsecrated. The influence of church bell ringing on the prices of surrounding residential properties, however, could not be substantiated.
Topic:: Economics, Religion, Property, and Price
Political Geography:: Europe and Germany

186. Urban Renewal after the Berlin Wall

Author:: Gabriel Ahlfeldt, Wolfgang Maennig, and Felix J. Richter
Publication Date:: 11-2013
Content Type:: Working Paper
Institution:: Chair for Economic Policy, University of Hamburg
Abstract:: Urban renewal areas are popular but empirically understudied spatial planning instruments designed to prevent urban decline and induce renewal. We use a quasi-experimental research design to study the effects of 22 renewal areas implemented in Berlin, Germany, to increase housing and living quality in the aftermath of the city’s division during the Cold War period. Our results suggest that the policy has helped reduce (increase) the number of buildings in poor (good) condition by 25% (10%). Property prices increased at an annual rate of 0.4-1.7% according to our preferred estimates. Evidence is weak at best, however, for positive housing externalities. More generally, our findings indicate that the efficiency of program evaluations for place based -policies using quasi-experimental methods increases with the number of targeted areas and areas that provide the counterfactual.
Topic:: Economics, Urban, Property, Revitalization, and Redevelopment
Political Geography:: Europe and Germany

187. Moral Categories in the Financial Crisis

Author:: Marion Fourcade, Philippe Steiner, Wolfgang Streeck, and Cornelia Woll
Publication Date:: 06-2013
Content Type:: Working Paper
Institution:: Max Planck Sciences Po Center on Coping with Instability in Market Societies (MaxPo)
Abstract:: Karl Marx observed long ago that all economic struggles invite moral struggles, or masquerade as such. The reverse may be true as well: deep moral-political conflicts may be waged through the manipulation of economic resources. Using the recent financial and Eurozone crises as empirical backgrounds, the four papers gathered here propose four different perspectives on the play of moral judgments in the economy, and call for broader and more systematic scholarly engagement with this issue. Focusing on executive compensation, bank bailouts, and the sovereign debt crisis, the symposium builds on a roundtable discussion held at the opening of the Max Planck Sciences Po Center on Coping with Instability in Market Societies (MaxPo) in Paris on November 29, 2012.
Topic:: Economics, Financial Crisis, Banking, and Sovereign Debt
Political Geography:: Europe

188. Transnational Civil Society and the Consumer-friendly Turn in Financial Regulation

Author:: Lisa Kastner
Publication Date:: 08-2013
Content Type:: Working Paper
Institution:: Max Planck Sciences Po Center on Coping with Instability in Market Societies (MaxPo)
Abstract:: The literature on financial regulation has typically emphasized the role of the powerful financial industry in shaping regulatory outcomes. However, capture theories cannot explain the prominence of financial consumer protection in post-crisis reform agendas. By contrast, this paper argues that, despite their collective action disadvantage, a polymorphous network of civil society organizations was able to gain momentum after the financial crisis and to influence the financial reform process. In this policy window, where decision-makers were looking out for an alternative source of expertise, a transnationally connected civil society network successfully raised the issue of consumer protection on reform agendas in tandem with public entrepreneurs and on the back of a popular backlash against big finance. This argument will be explored through a comparative study of the impact of transnational pressures on policy-makers in Europe and the US in the immediate aftermath of the crisis. In the conclusion, the paper discusses the substance of the financial reforms that have been undertaken.
Topic:: Civil Society, Economics, Regulation, and Finance
Political Geography:: Europe and United States of America

189. Financial Reform after the Crisis: An Early Assessment

Author:: Nicolas Véron
Publication Date:: 01-2012
Content Type:: Working Paper
Institution:: Peterson Institute for International Economics
Abstract:: This paper aims to take stock of global efforts towards financial reform since the start of the financial crisis in 2007–08, and to provide a synthetic (if simplified) picture of their status as of January 2012. Underlying dynamics are described and analyzed both at the global level (particularly G-20, IMF, and FSB) and in individual jurisdictions, as well as the impact the crisis has had on these regions. The possible next steps of financial reform are then reviewed, including: the ongoing crisis management in Europe, the new emphasis on macroprudential approaches, the challenges posed by globally integrated financial firms, the implementation of harmonized global standards, and the links between financial systems and growth.
Topic:: Economics, International Trade and Finance, Markets, Global Recession, and Financial Crisis
Political Geography:: Europe

190. The political economy of the fisheries sector in Uganda: ruling elites, implementation costs and industry interests

Author:: Fred Muhumuza, Anne Mette Kjær, Mesharch Katusiimeh, and Tom Mwebaze
Publication Date:: 02-2012
Content Type:: Working Paper
Institution:: Danish Institute for International Studies (DIIS)
Abstract:: This paper sets out to explain policies, implementation arrangements and results (PIRs) in Uganda's fisheries sector. Industry actors wanted to be able to keep up with European standards in order to survive in the chilled and frozen fillet export industry. They put pressure on ruling elites to support the establishment of effective hygiene and testing procedures. This helped the fishing industry succeed to an extent that helped create interests in the status quo. Fishermen, their dependents, and the fish processors all wanted to maintain a high level of fish catches. It was politically costly for ruling elites to enforce fisheries management because strict enforcement was unpopular with fishermen, as well as with many fishermen and security agents who benefitted from illegal fishing. Therefore, the success was not maintained: a pocket of efficiency was established with regard to hygiene and testing, but not with regard to enforcing fisheries management. Overfishing and the near collapse of the fishing sector were the results.
Topic:: Development, Economics, Government, Industrial Policy, International Trade and Finance, Poverty, and Social Stratification
Political Geography:: Uganda, Africa, and Europe

191. Global Governance Audit

Author:: Hakan Altinay
Publication Date:: 02-2012
Content Type:: Working Paper
Institution:: The Brookings Institution
Abstract:: We frequently treat the changing constellation that has come to be referred to as global governance as a lackluster fait accompli. Nobody has masterminded it. Nobody is really in charge. Almost everybody has reasons to be unhappy about what they view as its current suboptimal state. As such, global governance is not an easy phenomenon to assess or audit. The benchmarks and scales to be used are not obvious. Yet an audit attempt is nevertheless necessary, if for no other reason than to start to form a deliberated assessment, to develop some benchmarks, and to refine our questions for the future.
Topic:: Economics, Globalization, and Governance
Political Geography:: China and Europe

192. Regulatory Quality in the European Commission and the UK: Old questions and new findings

Author:: Andrea Renda, Oliver Fritsch, Claudio M. Radaelli, and Lorna Schrefler
Publication Date:: 01-2012
Content Type:: Working Paper
Institution:: Centre for European Policy Studies (CEPS)
Abstract:: This paper examines the quality of impact assessments in the European Commission and the United Kingdom for the period 2005-2010. We coded 477 impact assessments for the UK and 251 for the European Commission, using a detailed scorecard - adjusted to reduce the bias evidenced by previous usages of this instrument.
Topic:: Economics, Regional Cooperation, and Governance
Political Geography:: United Kingdom and Europe

193. Mispricing of Sovereign Risk and Multiple Equilibria in the Eurozone

Author:: Paul De Grauwe and Yuemei Ji
Publication Date:: 01-2012
Content Type:: Working Paper
Institution:: Centre for European Policy Studies (CEPS)
Abstract:: This paper finds evidence that a significant part of the surge in the spreads of the PIGS countries (Portugal, Ireland, Greece and Spain) in the eurozone during 2010-11 was disconnected from underlying increases in the debt-to-GDP ratios, and was the result of negative market sentiments that became very strong since the end of 2010.
Topic:: Economics, Monetary Policy, and Financial Crisis
Political Geography:: Europe, Greece, Spain, Portugal, and Ireland

194. Eschewing Choice: Ukraine's Strategy on Russia and the EU

Author:: Elena Gnedina and Evghenia Sleptsova
Publication Date:: 01-2012
Content Type:: Working Paper
Institution:: Centre for European Policy Studies (CEPS)
Abstract:: Ukraine has long been castigated for its noncommittal attitude to cooperation with the EU, this being part of its 'multi-vector' foreign policy. Such a policy was widely attributed to the failings of domestic elites, which delay reform for fear of losing rents and power. This CEPS Working Document suggests, however, that the recent setback in EU-Ukraine relations highlights more complex reasons behind this. First, it asserts that a pro-European vector is not a self-evident choice for Ukraine, which is economically interdependent with both Russia and the EU. Second, it finds that the economic crisis has made the EU less attractive in the short term. In good times business was looking to Europe for opportunities to develop. But in times of crisis, it is looking to Russia for cheap resources to survive. Despite these unfavourable short-term trends, the authors conclude that an association agreement with the EU stands out as the only alternative that promises to put the shaky Ukrainian economy back on track towards long-term sustainable economic growth.
Topic:: Economics, International Trade and Finance, and Markets
Political Geography:: Russia, Europe, and Ukraine

195. The Underachiever: Ukraine's Economy Since 1991

Author:: Pekka Sutela
Publication Date:: 03-2012
Content Type:: Working Paper
Institution:: Carnegie Endowment for International Peace
Abstract:: When Ukraine became independent in 1991, there were expectations that it would in the near future become a wealthy free market democracy and a full member of the European and Euro-Atlantic communities. The largest country geographically wholly European, and the fifth-biggest European nation by size of population, it was hoped, would become a member of the European Union (EU), the North Atlantic Treaty Organization (NATO), and the Organization for Economic Cooperation and Development (OECD).
Topic:: Corruption, Economics, Emerging Markets, International Trade and Finance, and Governance
Political Geography:: Europe, Ukraine, and Atlantic Ocean

196. Credit at Times of Stress: Latin American Lessons from the Global Financial Crisis

Author:: Liliana Rojas-Suarez and Carlos Montoro
Publication Date:: 02-2012
Content Type:: Working Paper
Institution:: Center for Global Development
Abstract:: The financial systems in emerging market economies during the 2008–09 global financial crisis performed much better than in previous crisis episodes, albeit with significant differences across regions. For example, real credit growth in Asia and Latin America was less affected than in Central and Eastern Europe. This paper identifies the factors at both the country and the bank levels that contributed to the behavior of real credit growth in Latin America during the global financial crisis. The resilience of real credit during the crisis was highly related to policies, measures and reforms implemented in the pre-crisis period. In particular, we find that the best explanatory variables were those that gauged the economy's capacity to withstand an external financial shock. Key were balance sheet measures such as the economy's overall currency mismatches and external debt ratios (measuring either total debt or short-term debt). The quality of pre-crisis credit growth mattered as much as its rate of expansion. Credit expansions that preserved healthy balance sheet measures (the “quality” dimension) proved to be more sustainable. Variables signalling the capacity to set countercyclical monetary and fiscal policies during the crisis were also important determinants. Moreover, financial soundness characteristics of Latin American banks, such as capitalization, liquidity and bank efficiency, also played a role in explaining the dynamics of real credit during the crisis. We also found that foreign banks and banks which had expanded credit growth more before the crisis were also those that cut credit most. The methodology used in this paper includes the construction of indicators of resilience of real credit growth to adverse external shocks in a large number of emerging markets, not just in Latin America. As additional data become available, these indicators could be part of a set of analytical tools to assess how emerging market economies are preparing themselves to cope with the adverse effects of global financial turbulence on real credit growth.
Topic:: Debt, Economics, Emerging Markets, Globalization, and Financial Crisis
Political Geography:: Europe, Asia, and Latin America

197. Europeanization in Turkey. Stretching a Concept to its Limits?

Author:: Tanja A. Börzel and Digdem Soyaltin
Publication Date:: 02-2012
Content Type:: Working Paper
Institution:: The Kolleg-Forschergruppe (KFG)
Abstract:: Research on Europeanization and domestic change has moved south-eastwards and was provided with another real-world experiment when it has meet with Turkey. This paper explores to what extent Europeanization approaches travel to Turkey, which does have a membership perspective that looks, however, ever less credible. The first part outlines the main findings of research on 'External Europeanization' focusing on factors that have limited or at least qualified the domestic impact of the EU in the Central and Eastern European (CEE) and Western Balkan (WB) accession countries. The paper, then, discusses to what extent Europeanization approaches need further qualification when applied to Turkey, which squares on democracy with the Western Balkans (with the exception of Croatia), but whose statehood is less limited. We argue that existing Europeanization approaches, largely, account for the overall moderate degree of Europeanization in Turkey. Yet, selective and differential domestic changes are mostly related to the extent to which EU conditionality helps domestic actors gain or hold political power and push their own political agenda. The paper concludes by summarizing the major implications Turkey's accession to the EU has for Europeanization approaches and discussing why Turkey is not a case sui generis.
Topic:: Democratization, Economics, and Politics
Political Geography:: Europe, Turkey, and Balkans

198. Country Forecast: Global outlook

Publication Date:: 04-2012
Content Type:: Working Paper
Institution:: Economist Intelligence Unit
Abstract:: Three years after the global economy reached its lowest point in three-quarters of a century, the recovery remains incomplete and the outlook uncertain. On March 9th 2009, the capitalisation of Morgan Stanley\'s global stockmarket index fell to US$26trn, nearly 60% below its 2007 peak. Today, the value of the world\'s stockmarkets has yet to return to the pre-crisis level—nor has the confidence of most consumers and businesses. The excesses of the last ten years—the personal debt accumulated early in the last decade and the public debt added during the recession—have saddled many countries with weak economic foundations and little or no resilience to shocks. This has left the US economy, in particular, struggling for a third straight year to lock in faster growth. It has left debt-ravaged Europe in recession and China manoeuvring unsteadily to deflate a bubble. On the brighter side, the global economy will grow again this year and the imbalances that built up over the past decade will continue to unwind. But global growth will be slower this year than last, and a host of risks—from elevated oil prices to war in the Middle East, to the collapse of Europe\'s single currency—will weigh on confidence and reduce spending and investment.
Topic:: Economics, Globalization, Markets, Global Recession, and Financial Crisis
Political Geography:: United States, China, Europe, and Middle East

199. The Quest for Political Reform in Azerbaijan: What Role for the Transatlantic Community?

Author:: Anar Valiyev
Publication Date:: 02-2012
Content Type:: Working Paper
Institution:: Istituto Affari Internazionali
Abstract:: As Azerbaijan celebrates its 20th anniversary of independence, democratic development remains a key challenge facing the country. Despite the fact that Azerbaijan successfully coped with immediate problems such as poverty reduction and economic and political stability, the need to reform the public administration and decentralize governance has become particularly urgent. The main problems, however, remain the same: low public trust in institutions, the absence of a democratic political culture and the lack of bridging social capital. In this regard, the assistance of the Transatlantic Community is necessary. The European Union and the United States should pursue a developmental approach to democracy promotion in Azerbaijan, which has higher chances to succeed than a more explicitly political approach, considering the weak institutional capacity in the country.
Topic:: Democratization, Development, Economics, Poverty, and Governance
Political Geography:: United States, Europe, and Azerbaijan

200. Welfare State Growth and the Current Crisis in Portugal: Social Spending and its Challenges

Author:: Miguel Glatzer
Publication Date:: 03-2012
Content Type:: Working Paper
Institution:: Institute of European Studies (IES), UC Berkeley
Abstract:: This paper focuses on the deep transformation of the Portuguese state under democracy and charts the development of very substantial welfare state. It examines the very substantial investments in social protection, social transfers, education and health and finds remarkable results in some areas but only partial success in others. The paper also looks at changes in employment and the growth of the state as a provider of jobs. The paper then turns to an analysis of the current crisis, examining both long-term factors and current dynamics as Portugal turns from initial stimulus to austerity to structural reform.
Topic:: Economics, Health, Poverty, and Governance
Political Geography:: Europe

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COLUMBIA UNIVERSITY PRESS