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15191. Deindustrialization and the Postsocialist Mortality Crisis

Author:
Gabor Scheiring, Aytalina Azarova, Darja Irdam, Katarzyna Doniec, and Martin McKee
Publication Date:
04-2021
Content Type:
Working Paper
Institution:
Political Economy Research Institute (PERI), University of Massachusetts Amherst
Abstract:
An unprecedented mortality crisis struck Eastern Europe during the transition from socialism to capitalism. Working-class men without a college degree suffered the most. Some argue that economic dislocation caused stress and despair, leading to adverse health behavior and ill health (dislocation-despair approach). Others suggest that hazardous drinking inherited as part of a dysfunctional working-class culture and populist alcohol policy were the key determinants (supply-culture approach). We enter this debate by performing the first quantitative analysis of the association between economic dislocation in the form of industrial employment decline and mortality in postsocialist Eastern Europe. We rely on a novel multilevel dataset, fitting survival and panel models covering 52 towns and 42,800 people in 1989-1995 in Hungary and 514 medium-sized towns in the European part of Russia. The results show that deindustrialization was significantly associated with male mortality in both countries directly and indirectly mediated by adverse health behavior as a dysfunctional coping strategy. Both countries experienced severe deindustrialization, but social and economic policies seem to have offset Hungary’s more immense industrial employment loss. The policy implication is that social and economic policies addressing the underlying causes of stress and despair can improve health.
Topic:
Employment, Capitalism, Mortality, Alcohol, Socialism, and Deindustrialization
Political Geography:
Europe, Eastern Europe, and Hungary

15192. Predicting Chinese State-Owned Enterprise Policy Incidence

Author:
Sara Hsu
Publication Date:
06-2021
Content Type:
Working Paper
Institution:
Political Economy Research Institute (PERI), University of Massachusetts Amherst
Abstract:
In this exploratory research, we examine the effect of economic and noneconomic indicators on the creation of Chinese state-owned enterprise policies. Using a VAR model, we find indicators that explain state-owned enterprise policy creation variance, which means that we can explain, to some extent, the incidence of state-owned enterprise policies. This reduces economic policy uncertainty, thereby having the potential to increase economic activity and reduce costs.
Topic:
Political Economy, Economy, and State-Owned Enterprises
Political Geography:
China and Asia

15193. The Flimsy Foundations of Neoliberal Macroeconomics: David Gordon on Saving, Investment, and the Natural Rate of Unemployment

Author:
Robert Pollin
Publication Date:
06-2021
Content Type:
Working Paper
Institution:
Political Economy Research Institute (PERI), University of Massachusetts Amherst
Abstract:
David Gordon was, at once, a highly creative economist with an enormous range of interests, while also uncompromising in maintaining rigorous research standards. He was focused equally on hard-core academic research and pressing policy issues. He was also openly committed to the political left, with this commitment animating all his work. One distinctive feature of Gordon’s work was his keenness to dive into the most important topics engaging mainstream economists and to inject explicitly left political economy perspectives into these mainstream debates. This paper focuses on two important examples of Gordon’s contributions that examine front-and-center mainstream macroeconomics questions. The first is the relationship between aggregate saving and investment. The second is the development of the concept of the ‘natural rate of unemployment.’ The evolution of mainstream research on these two questions played a critical role in overturning what had been, over the first two post-World War II decades, a prevailing Keynesian/social democratic consensus, at both the levels of analytic economics as well as economic policy. As the paper reviews, Gordon challenges the analytic findings and policy implications of these perspectives at their core. Gordon’s own basic premises and results are straightforward. He argues that, in fact, investment decisions, not saving rates, are the main driver of economic activity in capitalist economies and that operating capitalist economies at something akin to genuine full employment—i.e. in the range of 2 – 3 percent official unemployment—is a realistic goal. As such, these papers by Gordon contribute significantly toward envisioning a post-neoliberal social structure of accumulation that is committed to the egalitarian principles that were central to Gordon’s life work.
Topic:
Political Economy, Neoliberalism, Investment, Macroeconomics, Unemployment, Saving, and David Gordon
Political Geography:
Global Focus

15194. Financialization and Militarization: An Empirical Investigation

Author:
Pelin Akcagun and Adem Elveren
Publication Date:
06-2021
Content Type:
Working Paper
Institution:
Political Economy Research Institute (PERI), University of Massachusetts Amherst
Abstract:
Based on Arrighi (1994), we empirically investigate whether financialization and militarization are mutually reinforcing phenomena in the U.S. during the post-WW II period. Military spending during the 1950s and 1960s in the U.S., along with other external stimuli, such as a rising sales effort and expansion in finance, insurance, and real estate, counteracted the stagnation of the monopolistic stage of capitalism. Monopoly capital was transformed into finance monopoly capital as the intensity of financial capital increased during the late 1970s in response to stagnation. Considering alternative financialization variables commonly used in the literature and the profit rate in the financial sector, and using several parametric and non-parametric methods, we found a significant relationship between financialization and militarization in the U.S. for 1949-2019. The findings show that the decline in the profit rates lead to a decline in military expenditure. The overall results suggest that the rise in financialization is parallel to the decline in the profit rates, leading to larger military expenditure in total, but with relatively smaller share in GDP.
Topic:
Political Economy, Military Spending, Financialisation, and Militarization
Political Geography:
United States of America

15195. Predicting Chinese Banking Policy Incidence

Author:
Sara Hsu
Publication Date:
07-2021
Content Type:
Working Paper
Institution:
Political Economy Research Institute (PERI), University of Massachusetts Amherst
Abstract:
In this exploratory research, we examine the effect of economic and noneconomic indicators on the creation of Chinese Banking and Insurance Regulatory Commission policies using a VAR model. We find that CBIRC policies are predicted by State Council construction policies and policies set by the State Administration of Foreign Exchange. This indicates that the CBIRC is inward-looking, observing what other regulators are doing rather than responding to changes in the real and financial economy. This may be a product of market distortions due to China’s unique blend of state-oriented and market-based institutions.
Topic:
Political Economy, Regulation, and Banking
Political Geography:
China and Asia

15196. Financialization, Deindustrialization, and Instability in Latin America

Author:
Esteban Perez-Caldentey and Matias Vernengo
Publication Date:
06-2021
Content Type:
Working Paper
Institution:
Political Economy Research Institute (PERI), University of Massachusetts Amherst
Abstract:
The paper analyzes the relation between premature deindustrialization in Latin America with what is termed premature financialization. Premature financialization is defined as a turn to finance, organized as an industrial concern, which is a vehicle for accumulation before the process of industrialization has reached maturity. This contrasts with developed countries where financialization occurs after an advanced stage of economic and social development is reached, and where the growth of the financial sector, beyond a certain threshold, can be detrimental to economic activity. The paper examines the consequences of premature financialization for investment, growth, and financial stability.
Topic:
Economic Growth, Investment, Financial Stability, Financialisation, Deindustrialization, and Instability
Political Geography:
Latin America

15197. Mapping Religion, Space, and Economic Outcomes in Indian Cities

Author:
Sripad Motiram and Vamsi Valuabharanam
Publication Date:
08-2021
Content Type:
Working Paper
Institution:
Political Economy Research Institute (PERI), University of Massachusetts Amherst
Abstract:
We deploy a socio-spatial approach and use a spatially representative survey that we conducted in Hyderabad and Mumbai to analyze the relation between city space and religion. After documenting the relative status of religious groups in urban India and different types of cities using secondary databases, we identify poor-ghettos and elite-enclaves in Hyderabad and Mumbai. In both cities, ghettos have a high proportion of Muslims, while enclaves are dominated by non-Muslim inhabitants. Ghettoization of Muslims is far more pronounced in Hyderabad than in Mumbai. A key finding on the relation between city space and religion is that compared to segregated neighborhoods, mixed (“grayer”) neighborhoods produce better economic outcomes like lower poverty. We argue that while Indian cities are becoming less integrated along religious lines over the last 3-4 decades, this process is far from complete, and needs to be reversed.
Topic:
Economics, Religion, Space, and Cities
Political Geography:
South Asia and India

15198. Stranded Fossil-Fuel Assets Translate into Major Losses for Investors in Advanced Economies

Author:
Gregor Semieniuk, Philip B. Holden, Jean-Francois Mercure, Pablo Salas, Hector Pollitt, Katharine Jobson, Pim Vercoulen, Unnada Chewpreecha, Neil Edwards, and Jorge E Viñuales
Publication Date:
10-2021
Content Type:
Working Paper
Institution:
Political Economy Research Institute (PERI), University of Massachusetts Amherst
Abstract:
The distribution of ownership of transition risk associated with stranded fossil-fuel assets remains poorly understood. We compute global stranded assets of US$1.4 trillion in the upstream oil and gas sector as expectations change to be consistent with stated climate policies. We trace the equity risk ownership from these 43,439 assets through a global equity network of 1.8 million companies to their ultimate owners. Most of the market risk falls on private investors, overwhelmingly in OECD countries, including substantial exposure through pension funds. Financial markets are exposed to a US$690 billion correction, comparable to the mispricing that triggered the 2007-08 crisis. The ownership distribution also shows the large stake OECD investors have in the continued operation of fossil-fuel facilities incompatible with climate change mitigation goals.
Topic:
Climate Change, Political Economy, Economy, Investment, and Fossil Fuels
Political Geography:
Global Focus

15199. International Migration Dynamics in the Context of OECD Countries

Author:
Sinem Dedeoglu Ozkan
Publication Date:
01-2021
Content Type:
Journal Article
Journal:
Novus Orbis: Journal of Politics & International Relations
Institution:
Department of International Relations, Karadeniz Technical University
Abstract:
Globalization, one of the important phenomena of today, has led to political, social and economic changes in both regional and national scale. These rapid changes seriously affect the phenomenon of migration, its target and the quality of life. Especially in EU and OECD countries, various policies have been implemented to prevent the increasing migration rate, fulfill the requirements of the global economy, and to eliminate the developmental differences between countries, regions and sub-regions. Thus, it is of great importance to investigate the causes of international migrant mobility that deeply affects the economic and social structure of nations. The present study aimed to determine the factors that affect international migration towards the OECD countries. A current data set consisting of 79 variables defining the social, economic, environmental structure was created and correlation and regression analysis methods were used to determine the factors that affected international migration in OECD countries. With this work; it has been observed that there are strong relationships between international migration and various economic and social development variables. Hence, it is envisaged to make a descriptive and statistically valid, reliable assessment, to make predictions, and to contribute to the scientific literature in the context of international migration policies.
Topic:
Environment, Globalization, International Cooperation, Migration, and Borders
Political Geography:
Global Focus

15200. Europeanisation in Non-European Union Countries and the Foreign and Security Policies of Associated States

Author:
Erol Kalkan
Publication Date:
01-2021
Content Type:
Journal Article
Journal:
Novus Orbis: Journal of Politics & International Relations
Institution:
Department of International Relations, Karadeniz Technical University
Abstract:
This study aims to explore the influence of the European Union (EU) and Common Security and Defence Policy (CSDP) on non-EU countries and the foreign and security policies of associated states. It argues that the scope of EU’s transformative impact is not limited to the EU members and their economy, rule of law and democracy. Although it is at a relatively few and new, the EU has an increasing impact on non-EU countries and the security, defence and foreign policies of EU members. The findings of study reveals that the influence of the EU on non-EU members and on the security, defence and foreign policies of EU members occurs in four ways: a) adaptation to the EU/CSDP norms and values through socialisation and experimental learning, b) adaptation to the EU/CSDP requirements, norms and values as an outcome of the EU calls and conditionality, c) adaptation to the EU/CSDP requirements, norms and values to achieve diplomatic and national goal at international level and d) adaptation to the EU/CSDP requirements, norms and values as an outcome of the effect of the EU on the domestic balance of power and the ‘domestic sources’ of external policy.
Topic:
Security, Defense Policy, Diplomacy, European Union, and Economic Cooperation
Political Geography:
Europe