the effect of imf lending on the probability of sovereign debt crises abstract this paper explores empirically how the adoption of imf programs affects sovereign risk over the medium term we find that imf programs significantly increase the probability of subsequent sovereign defaults by approximately 1 5 2 percentage points these results cannot be attributed to endogeneity bias as they are supported by specifications that explain sovereign defaults and program participation simultaneously furthermore imf programs turn out to be especially detrimental to fiscal solvency when the fund distributes its resources to countries whose economic fundamentals are already weak our evidence is therefore consistent with the hypothesis that debtor moral hazard is most likely to occur in these circumstances other explanations that point to the effects of debt dilution and the possibility of imf triggered debt runs however are also possible

the logic of institutional preferences german electoral law as a social choice outcome institutions determine the results of social decision processes yet institutions are themselves endogenous products of earlier social choices this paper explores the hypothesis that participants in the choice of institutions seek alternatives that favor their desired policies the choice of institutions can be analyzed in terms of bargaining between individuals or parties where preferences derive from preferences over policy and bargaining is structured by existing institutions this approach is used to study the choice of an electoral system in germany after world war ii the hypothesis that parties choose electoral institutions to maximize their future policy influence explains both the adoption of proportional representation in 1949 and the switch to a two vote ballot in 1953

external liabilities and crises abstract we examine the determinants of external crises focusing on the role of foreign liabilities and their composition using a variety of statistical tools and comprehensive data spanning 1970 2011 we find that the ratio of net foreign liabilities to gdp is a significant crisis predictor this is primarily due to the net position in debt instruments the effect of net equity liabilities is weaker and net fdi liabilities seem if anything an offset factor we also find that i breaking down net external debt into its gross asset and liability counterparts does not add significant explanatory power to crisis prediction ii the current account is a powerful predictor iii foreign exchange reserves reduce the likelihood of crisis more than other foreign asset holdings and iv a parsimonious probit containing those and a handful of other variables has good predictive performance in and out of sample the latter result stems largely from our focus on external crises sensu stricto

electorally unstable by supply or demand an examination of the causes of electoral volatility in advanced industrial democracies the stability of voters partisan choices from election to election is a key feature of democratic politics but why it varies across advanced industrial democracies and elections is not well understood this study makes several key contributions to explaining electoral volatility firstly it is argued and demonstrated that strategic voting plays an independent role in inducing vote switching secondly the analysis shows that demand side factors such as socio economic cleavages and organizations do not predict voter stability whereas supply side factors such as the party system government performance and strategic incentives do thirdly earlier contradictory findings with respect to the role of the electoral system are clarified as its effects are shown to be indirect rather than direct and finally the importance of the temporal dimension to stability is demonstrated as the time since the previous election is found to have a positive effect on volatility the results are based on a comprehensive statistical analysis of 336 elections in 21 countries between 1950 2005 where the significance as well as the robustness of individual variables across different model specifications inform the conclusions

crises and exchange rate regimes time to break down the bipolar view we revisit the link between crises and exchange rate regimes err using a panel of 90 developed and developing countries over the period 1980 2009 we find that corner err are not more prone to crises compared to intermediate err this finding holds for different types of crises banking currency and debt and is robust to a wide set of alternative specifications consequently we clearly break down the traditional bipolar view countries that aim at preventing crisis episodes should focus less on the choice of the err and instead implement sound structural macroeconomic policies

evaluation of the environmental impact of weekly food consumption in different socio economic households in australia using environmentally extended input output analysis this paper uses input output analysis to model the environmental impacts of the weekly food consumption of australia s households sorted by income quintile in 2003 we found that weekly food consumption of the relatively better off households caused greater environmental burden than that of the less well off household meat and bakery products flour cereals were the categories that contributed the largest share of environmental impacts in an average household s food consumption footprint 58 water 26 energy 29 co2 and 31 wasted materials per dollar spent fruit and vegetables generated 0 0874 m3 of water 0 0055 gj of energy 0 37 kg of co2 and 0 0114 kg of wasted materials this was lower than the per dollar impacts of bakery products 0 8482 0 0067 0 63 0 0204 meat 0 3471 0 0070 0 65 0 0203 dairy 0 0995 0 0114 0 98 0 0192 and edible fats 0 2373 0 0080 0 70 0 0165 eating out and fast food consumption also had a low per dollar impact 0 1317 0 0046 0 38 0 0141 we surmise that substituting fruit and vegetables at the expense of animal products processed foods and fats would decrease environmental impacts change at low income levels should be focused upon meat bakery and dairy consumption while higher incomes should be focused upon the consequences of eating food outside the home

sovereign debt relief and its aftermath this paper studies sovereign debt relief in a long term perspective we quantify the relief achieved through default and restructuring in two distinct samples 1920 1939 focusing on the defaults on official government to government debt in advanced economies after world war i and 1978 2010 focusing on emerging market debt crises with private external creditors debt relief was substantial in both eras averaging 21 of gdp in the 1930s and 16 of gdp in recent decades we then analyze the aftermath of debt relief and conduct a difference in differences analysis around the synchronous war debt defaults of 1934 and the baker and brady initiatives of the 1980s 1990s the economic landscape of debtor countries improves signicantly after debt relief operations but only if these involve debt write offs softer forms of debt relief such as maturity extensions and interest rate reductions are not generally followed by higher economic growth or improved credit ratings jel e6 f3 n0 and h6

the dynamics of sovereign default risk and political turnover abstract this paper develops a stochastic dynamic politico economic model of sovereign debt to analyze the interaction of sovereign default risk and political turnover two parties differ in their preferred size of unproductive public spending which is financed by taxes and external debt electoral outcomes are characterized by the economic benefits from the incumbent s policies and stochastic idiosyncratic ideological aspects quantitative findings suggest that endogenous political turnover increases the discrepancies between the optimal borrowing and default policies of the two parties prior to a debt crisis the incumbent government accumulates external debt to foster the probability of remaining in power the dynamic interaction of electoral outcomes external debt and sovereign default supports arguments for imposing institutional constraints on incumbent governments

environmental impacts of changes to healthier diets in europe food consumption causes together with mobility shelter and the use of electrical products most life cycle impacts of consumption meat and dairy are among the highest contributors to environmental impacts from food consumption a healthier diet might have less environmental impacts using the e3iot environmentally extended input output database developed in an eu study on environmental impacts of products eipro this paper estimates the difference in impacts between the european status quo and three simulated diet baskets i e a pattern according to universal dietary recommendations the same pattern with reduced meat consumption and a mediterranean pattern with reduced meat consumption production technologies protein and energy intake were kept constant though this implies just moderate dietary shifts impact reductions of up to 8 were possible in reduced meat scenarios the slightly changed food costs do not lead to significant first order rebound effects second order rebounds were estimated by applying the capri partial equilibrium model this analysis showed that european meat production sector will most likely respond by higher exports to compensate for losses on the domestic meat market higher impact reductions probably would need more drastic diet changes 2011 elsevier b v

presidentialism and the effect of electoral law in postcommunist systems regime type matters efforts to test duverger s law in the new democracies of postcommunist europe have had mixed results research argues that mixed systems have an effect on the number of effective parties that is distinct from that of single mandate district and proportional representation systems less attention has been given to the effect of other institutions on the party system particularly strong presidents analyzing election results in postcommunist europe the authors find support for duverger s law after controlling for the strength of the executive they argue that strong presidents substantially reduce the incentive for parties to seize control of the legislative agenda hence the restraint that electoral systems exercise on the proliferation of parties and independent candidates is weakened the authors find that a further consequence of strong presidents is that the incentive for majority control of committees and the legislative agenda is weakened

how central banks prepare for financial crises an empirical analysis of the effects of crises and globalisation on international reserves central banks international reserve holdings have increased significantly in the recent past while traditional models fail to explain this accumulation of reserves the more recent literature argues that reserves are used as a lifejacket against currency crises however research so far has neglected the question whether and how central banks change their precautionary reserve holdings after the country was affected by a currency crisis this paper tests the hypothesis that central banks revise their reserve policy in the aftermath of currency crises a dynamic panel data model is estimated for developing and industrial countries covering the period from 1975 to 2003 the evidence suggests that currency crises induce a permanent increase of reserves this effect is particularly strong for recent currency crises since the asian financial crisis

does strengthening collective action clauses cacs help does improving creditor coordination by strengthening cacs lead to efficiency gains in the functioning of sovereign bond markets we address this question in a model featuring both debtor moral hazard and creditor coordination under incomplete information conditional on default we characterize the interim efficient cac threshold and show that strengthening cacs away from unanimity results in interim welfare gains however once the impact of strengthening cacs on debtor s incentives is taken into account we demonstrate the robust possibility of a conflict between ex ante and interim efficiency we calibrate our model to quantify such a welfare trade off and discuss the policy implications of our results

institutions and investors the politics of the economic crisis in southeast asia the most dramatic development in the international political economy during the 1990s the asian economic crisis deserves our attention given that asia s rapid economic rise spawned so many debates in the literature it is peculiar that a radical interruption to asia s economic development has not engendered more theoretical argument among political scientists economists have engaged in furious and productive debate but have been unable to deal with the political dimensions of the crisis in this article i make a strong claim about the importance of politics in explaining one of the big puzzles in the overall saga why the investment reversal was greater in some countries than in others i argue that a tight focus on political institutions yields a remarkable degree of analytic purchase in explaining why some countries coped better than others during the crisis specie cally i stress the distribution of veto authority highlighting the way this shaped the overall character of the policy environment and in turn affected investors i identify two policy syndromes rigidity and volatility that are at opposite ends of a continuum and are severely suboptimal for investors particularly during times of crisis i show that these two syndromes can be directly linked to the institutional framework of government the wider the dispersal of veto authority the greater the risk of policy rigidity conversely the tighter the concentration of veto authority the greater the risk of policy volatility these two policy syndromes bear directly on the differing responses of governments to the crisis much of the best literature on the asian crisis has come from economists and falls into one of three theoretical clusters variants of e rst generation currency crisis models that emphasize imbalances in macroeconomic fundamentals variants of

sovereign debt in emerging market countries not all of them are serial defaulters avoiding to assign emerging market countries a typical behaviour this article considers the heterogeneity across them and through time to predict their sovereign default episodes moreover it f

an early warning system for predicting systemic banking crises in the eurozone a logit regression approach abstract eurosystem macroprudential policies require shared action between national authorities and the european central bank ecb this has created the need for a common basis for macroprudential analysis and as result the macroprudential database mpdb was created by the ecb and the european systemic risk board esrb in 2015 in order to support the central bank s functions and esrb s needs this paper examines a multivariate binary logit early warning model ewm for systemic banking crises with the aim to evaluate the predictive validity of the risk indicators included in the mpdb as well as further variables not employed in previous relevant studies the main finding is that most of the risk indicators employed from mpdb are important for forecasting from 4 to 1 years before the onset of a systemic banking crisis specific banking variables that capture industry concentration assets funding and liquidity are more important on average than macroeconomic variables important financial stress indicators such as clifs and sovciss and economic expectations are also significant the model is robust to various specifications and has a better performance when post crisis observations are not included

parchment equilibria and institutions institutions are rules that constrain political behavior although there is consensus that being written down is neither necessary nor sufficient for an institution to be effective much research on comparative institutions focuses on formal parchment institutions this article argues that parchment can contribute to the generation of shared mutual expectations among political actors which are essential to the effectiveness of institutions next the article distinguishes between research that emphasizes the role of institutions in aggregating preferences into political decisions and research that relies on coordination models to identify conditions favoring certain equilibrium outcomes when multiple equilibria are possible the article notes the increasing prominence of such coordination models in research on comparative institutions and concludes with some reflections about the prospects for this trend to foster connections between institutional analysis and the field of comparative politics more bro

the electoral sweet spot low magnitude proportional electoral systems can electoral rules be designed to achieve political ideals such as accurate representation of voter preferences and accountable governments the academic literature commonly divides electoral systems into two types majoritarian and proportional and implies a straightforward trade off by which having more of an ideal that a majoritarian system provides means giving up an equal measure of what proportional representation pr delivers we posit that these trade offs are better characterized as nonlinear and that one can gain most of the advantages attributed to pr while sacrificing less of those attributed to majoritarian elections by maintaining district magnitudes in the low to moderate range we test this intuition against data from 609 elections in 81 countries between 1945 and 2006 electoral systems that use low magnitude multimember districts produce disproportionality indices almost on par with those of pure pr systems while limiting party system fragmentation and producing simpler government coalitions

rules of thumb for sovereign debt crises abstract this paper investigates the economic and political conditions that are associated to the occurrence of a sovereign debt crisis we use a new statistical approach classification and regression tree that allows us to derive a collection of rules of thumb that help identify the typical characteristics of defaulters we find that not all crises are equal they differ depending on whether the government faces insolvency illiquidity or various macroeconomic risks we also characterize the set of fundamentals that can be associated with a relatively risk free zone this classification is important for discussing appropriate policy options to prevent crises and improve response time and prediction

differentiating mixed member electoral systems mixed member majoritarian and mixed member proportional systems and government expenditures the increasing use of mixed member electoral systems has led to an explosion of research attempting to specify their effects yet there has been no work on the economic policy effects of such systems even though this has been a significant subject of debate for scholars analyzing other electoral systems an analysis of mixed member system policy effects is problematic given the wide variation in institutional rules among different systems this article attempts to determine whether the institutional differences between mixed member majoritarian mmm and mixed member proportional mmp systems lead to differences in policy outputs the political economy literature finds that government expenditures are positively correlated with electoral system proportionality our statistical analysis of government expenditures in 17 mixed member systems between 1990 and 2000 shows that mmp systems which are more proportional than mmm systems are correlated with higher levels of government spending thus the mmm mmp

going it alone strategic entry under mixed electoral rules recent studies on strategic voting and entry in elections that combine plurality or majority and proportional representation pr have found candidate placement in single member district smd races to improve a party s pr performance the primary implication of the existence of contamination effects is that parties have an incentive to nominate candidates in as many single member districts as possible pre electoral coordination in the majoritarian component of mixed electoral systems however is far from uncommon in this article we identify a number of institutional incentives that induce political parties to form pre electoral alliances in spite of contamination effects by identifying institutions that favor and hamper coordination we seek to advance the understanding of pr smd interactions and to assess their implications for the design classification and empirical analysis of mixed electoral rules our statistical tests evaluate strategic entry in a diverse sample of countries

gains from trade and the sovereign bond market abstract increasing international flows of goods services and financial assets have been shown to increase a country s welfare through various channels this paper studies how a country s access to a bond market affects its welfare gains from international trade we do so by incorporating a sovereign bond market into a simple armington 1969 s trade model while standard trade models suggest surprisingly small gains from trade our model implies that introducing channels through a sovereign bond market greatly magnifies the gains from trade key mechanisms in the model are confirmed by data and the results are found to be robust to a variety of considerations

integrating climate change and health into food policy an analysis of how climate change can affect food prices and population health abstract the inter related nature of food health and climate change requires a better understanding of the linkages and a greater alignment of policy across these issues to be able to adequately meet the pressing social and health challenges arising from climate change food price is one way through which climate change may affect health the aim of this study of the global and australian food systems is to provide a whole of system analysis of food price vulnerabilities highlighting the key pressure points across the food system through which climate change could potentially have the greatest impact on consumer food prices and the implications for population health we outline areas where there are particular vulnerabilities for food systems and food prices arising from climate change particularly global commodity prices agricultural productivity short term supply shocks and less direct factors such as input costs and government policies we use australia as a high income country case study to consider these issues in more detail the complex and dynamic nature of pricing mechanisms makes it difficult to predict precisely how prices will be impacted should prices rise disproportionately among healthy foodstuffs compared to less healthy foods there may be adverse health outcomes if less expensive and less healthy foods are substituted higher prices will also have equity implications with lower socio economic groups most impacted given these households currently spend proportionately more of their weekly income on food the ultimate objective of this research is to identify the pathways through the food system via which climate change may affect food prices and ultimately population health thereby providing evidence for food policy which takes into account environmental and health considerations

the institutional environment for infrastructure investment the empirical evidence that links political institutions to economic outcomes has grown dramatically in recent years however virtually all of this analysis is undertaken using data from the past three decades this paper extends this empirical framework by performing a two century long historical analysis of the determinants of infrastructure investment in a panel of over 100 countries the results demonstrate that political environments that limit the feasibility of policy change are an important determinant of investment in infrastructure copyright 2002 oxford university press

sovereign debt restructurings preemptive or post default sovereign debt restructurings can be implemented preemptively prior to a payment default we code a comprehensive new dataset and nd that preemptive restructurings i are frequent 38 of all deals 1978 2010 ii have lower haircuts iii are quicker to negotiate and iv see lower output losses to rationalize these stylized facts we build a quantitative sovereign debt model that incorporates preemptive and post default renegotiations the model improves the t with the data and explains the sovereign s optimal choice preemptive restructurings occur when default risk is high ex ante while defaults occur after unexpected bad shocks empirical evidence supports these predictions jel f34 f41 h63

public debt and growth heterogeneity and non linearity we study the long run relationship between public debt and growth in a large panel of countries our analysis builds on theoretical arguments and data considerations in modelling the debt growth relationship as heterogeneous across countries we investigate the debt growth nexus adopting linear and non linear specifications employing novel methods and diagnostics from the time series literature adapted for use in the panel we find some support for a negative relationship between public debt and long run growth across countries but no evidence for a similar let alone common debt threshold within countries

electoral systems and the number of parties in postcommunist states scholars studying electoral systems have consistently found that single member plurality elections tend to constrain the number of parties operating in a polity to a much greater extent than multimember proportional representation systems this article tests this hypothesis in the postcommunist context by examining the effects of proportional representation and single member district elections on the number of parties in five postcommunist states it is shown that some postcommunist states most notably poland and hungary have followed the standard pattern of party consolidation over time in reaction to incentives of electoral systems while others most notably russia and ukraine have not the author argues that the different effects of electoral systems can be attributed to different levels of party institutionalization found in postcommunist states these findings have policy implications under conditions of extreme party underdevelopment the electoral system that promotes the use of party labels proportional representation may be more effective than the plurality system in constraining the number of parties provided a legal threshold is used this runs counter to the conventional wisdom that plurality elections offer the greatest constraint on the number of parties