the international monetary fund and developing countries a review of the evidence and policy options as its systemic role evaporated with the collapse of the bretton woods system so the international monetary fund imf became drawn into a much more specific role in the context of the balance of payments bop problems that developing countries were encountering at its inception the imf had been seen as having no specific role in developing countries but now it became exclusively these countries that formed its clientele while during the 1970s the imf had continued to make a few relatively large loans to a limited number of industrial countries italy and the united kingdom beyond the mid 1970s industrial countries ceased to draw any resources from it

occupation and the political economy of trade job routineness offshorability and protectionist sentiment the recent backlash against globalization in many advanced economies raises questions about the source of this protectionist sentiment traditional accounts generally attribute the welfare consequences of trade to skill level or industry characteristics or instead emphasize the nonmaterial determinants of support for openness consequently we know little about how a major labor market characteristic occupation shapes both the distributional consequences of and preferences toward trade openness we propose and test a new theory of trade policy preferences based on occupation characteristics drawing from the tasks literature in economics we argue that occupation characteristics are a key determinant of how trade affects workers and thus individuals trade preferences our theory suggests that in advanced economies individuals in routine task intensive occupations will be negatively affected by trade and thus more protectionist this relationship will increase in the degree to which occupation job tasks can be provided from a distance i e offshorable we find support for our theory using data from the 2003 and 2013 international social survey programme in high income democracies our results suggest that the occupational characteristics of routineness and offshorability are important determinants of trade preferences offering additional understanding of the sources of protectionist sentiment even after controlling for labor market characteristics suggested by conventional wisdom

domestic responses to capital market internationalization under the gold standard 1870 1914 the internationalization of capital markets that occurred during the era of the classical gold standard 1870 1914 was part of a broader set of trends that threatened to drain local markets from capital and channel that capital to the national financial center and from there toward other national financial centers still internationalization was neither inevitable uniform nor irreversible but was a political choice informed by redistributional considerations between rival domestic interests and decided by politically dominant coalitions the domestic institutional structure in each country determined the composition of the politically dominant coalition decentralized structures allowed potential losers to curb public policies favorable to capital market internationalization whereas centralized structures allowed expected winners to promote such policies as a result economies with centralized states ended up being the most dependent on the international capital market whereas economies with decentralized states took a less active part in the globalization of finance

divided government and u s trade policy much ado about nothing scholars assert that divided government impedes the liberalization of u s trade policy they claim that presidents favor freer trade and will use the negotiating authority congress delegates to them to reach agreements lowering trade barriers since presidents gain more support from their congressional co partisans less liberalization ensues under divided government this theory rests on the premise that party is unrelated to congressional trade policy preferences beyond legislators tendencies to support their presidential co partisans yet before 1970 congressional democrats were relatively free trading regardless of the president s party affiliation since then the same has been true of republicans divided government facilitates the trade policies of presidents from the protectionist party since they win more support from their opposition in this area divided government does impede the efforts of presidents from the free trading party to liberalize i conclude that divided government has no consistent effect on trade policy outcomes

green price indices abstract this paper suggests two theoretically consistent and empirically tractable ways that a cost of living index can be expanded to include the environment and other public goods in addition it presents an empirical illustration of such an index for los angeles california incorporating air quality and other spatially varying public goods using a hedonic model the results indicate that the required information can be recovered and that including public goods can make a substantial difference in the index

positive feedback the impact of trade liberalization on industry demands for protection contrary to widely accepted theories of interest group demand for protection industries that experience high and rising import competition after a reduction in trade barriers often become less rather than more protectionist in the long term to unravel this paradox i propose and test a theory that explains variation in domestic producer groups demand for protection over time this model of industry behavior suggests that trade liberalization has a positive feedback effect on the policy preferences and political strategies of domestic industries compelling them to adjust to more competitive market conditions and thereby reducing their future demand for protection

wage bargaining central bank independence and the real effects of money the effects of financial capital mobility on monetary policy autonomy are relatively well understood but the importance of particular monetary regimes in distinct national institutional settings is not this article is a theoretical and empirical exploration of the effects of monetary policy regimes on unemployment in different national wage bargaining settings based on a rational expectations two stage game of the interaction between the wage behavior of labor unions and the monetary policies of governments i argue that monetary policies have real employment effects in all but the most decentralized bargaining systems specifically in intermediately centralized bargaining systems a credible government commitment to a nonaccommodating monetary policy rule will deter militant wage behavior with salutary effects on unemployment in highly centralized systems by contrast restrictive monetary policies will clash with unions pursuit of wage distributive goals and produce inferior employment performance only in highly fragmented bargaining systems is money neutral in the sense that employment performance is unaffected by monetary regimes the model has clear consequences for the optimal design of central banks and collective bargaining arrangements and suggests new ways to study institutional change hereunder the causal effect of increasingly globalized capital markets the argument is supported by pooled time series data for fifteen oecd countries over a twenty one year period

impact of oil prices economic diversification policies and energy conservation programs on the electricity and water demands in kuwait abstract this paper describes the influences of oil revenue and government s policies toward economic developments and energy efficiency on the electricity and water demands a kuwait specific electricity and water demand model was developed based on historic data of oil income gross domestic product gdp population and electric load and water demand over the past twelve years 1998 2010 moreover the model took into account the future mega projects annual new connected loads and expected application of energy conservation programs it was run under six circumstances representing the combinations of three oil income scenarios and two government action policies toward economic diversification and energy conservation the first government policy is the status quo with respect to economic diversification and applying energy conservation programs the second policy scenario is the proactive strategy of raising the production of the non oil sector revenue and enforcing legislations toward energy demand side management and conservation in the upcoming 20 years the average rates of change of the electric load and water demand increase are 0 13 gw and 3 0 migd respectively per us dollar oil price increase moreover through proactive policy the rates of average load and water demand decrease are 0 13 gw and 2 9 migd per year respectively

real sources of european currency policy sectoral interests and european monetary integration in the thirty years before economic and monetary union was achieved european currency policies varied widely among countries and over time in this article i argue that the sectoral impact of regional exchange rate arrangements in particular their expected real effects on european trade and investment exerted a powerful influence on the course of european monetary integration the principal benefit of fixing european exchange rates was facilitation of cross border trade and investment within the european union eu the principal cost of fixed rates was the loss of national governments ability to use currency policy to improve their producers competitive position empirical results indeed indicate that a stronger and more stable currency was associated with greater importance of manufactured exports to the eu s hard currency core while depreciations were associated with an increase in the net import competition faced by the country s producers this suggests a powerful impact of real factors related to trade and investment and of private interests concerned about these factors in determining national currency policies

indices of household welfare and the value of leisure time i introduction a true leisure inclusive welfare index indicates the compensatory change in wage rates goods consumption or nonlabor income required to enable the household to attain some reference period utility given an exogenous change in wage rates and prices although these indices are theoretical constructs for the measurement of individual or household welfare changes empirical analyses of these indices have relied upon aggregate time series data these data provide information on national average changes in wage rates goods consumption and hours worked but do not capture changes in hours worked at the household level due to increased labor market participation while the entry of many new part time workers into the labor market may decrease the national average of hours worked per week there may be a decrease in leisure for many households in addition the aggregate time series approach ignores differences across households in demographic attributes and the occupations and industries in which household members are employed to address these issues two large cross sections of household data the 1972 and 1980 bls consumer expenditure surveys u s bureau of labor statistics 1978 were used to calculate three types of leisure inclusive welfare indices the real wage index goods consumption and nonlabor income indices for each of six household demographic groups households comprising a husband and wife with zero or more dependent non working children were considered as the basic decisionmaking units in this household approach two real wage indices could be constructed that of the husband and that of the wife since the labor services of the two individuals may be valued differently the remainder of the paper is organized as follows in section ii the leisure inclusive welfare indices are developed theoretically the fixed weight bounds on the true indices and the limitations of these indices in the context of a more general but as yet undeveloped intertemporal behavior framework is discussed in section iii the data and empirical results are discussed and analyzed a summary and conclusions follow in section iv along with suggestions for future research

measuring the cost of shelter for homeowners theoretical and empirical considerations recent economic developments have aroused substantial interest in the treatment in the consumer price index cpi of the cost of shelter for homeowners from december 1977 when the latest version of the cpi was introduced until december 1980 the all items cpi increased at an average annual rate of 11 6 while the homeownership component increased at an average annual rate of 16 2 relative to all of the other goods and services in the cpi the homeownership component has increased by 17 5 over the same time period if the relative price of homeownership had remained constant the growth rate of the cpi would have been reduced to 10 1 the question which has been raised is whether the rapid relative increase in the homeownership component which has had such an important impact on the cpi truly reflects changes in the cost of shelter this question is not only important but difficult encompassing many subsidiary questions and auxiliary issues the purposes of this paper are threefold 1 to outline briefly a conceptual framework for the cpi which leads to a straightforward specification of what the shelter component of the cpi should measure 2 to evaluate the theoretical properties of alternative procedures designed to approximate this measurement objective and 3 present empirical evidence on the operational difficulties involved in pursuing a new approach to shelter cost measurement two main conclusions are reached first on both theoretical and empirical grounds a rental equivalence approach to measuring shelter costs for owner occupants is preferred second an estimated rental equivalence measure has grown more slowly over at least the past six years than the official cpi homeownership component given the way in which the cpi is used to escalate both private and public expenditures these results demonstrate that the choice of measurement technique has important distributional implications

veto players and the choice of monetary institutions i argue that two types of veto players matter in the choice of monetary institutions party veto players and subnational governments which are strong in federal systems but weak in unitary systems a crucial issue is whether voters can readily identify the manipulation of the economy with party players a second issue concerns the national party veto player s ability to control either fiscal or monetary policy in one party unitary governments identification and control are clear parties where such governments are common prefer flexible exchange rates and dependent central banks in multiparty coalition governments in unitary systems identification is traditionally difficult and the ability to target benefits to specific constituencies under fiscal policy makes fiscal policy autonomy more attractive for coalition governments such governments prefer central banks that are politically independent but that finance government debt under federalism parties that constitute the central government have less control over fiscal policy and they prefer flexible exchange rates subnational governments do not support a dependent central bank that gives more power to the central government

iceland on the rocks the mass political economy of sovereign debt resettlement we undertake an individual level analysis of mass political behavior toward sovereign debt resettlement by leveraging the unique circumstances of a 2011 referendum on debt repayment in iceland this allows us to engage broader questions about mass international political economy against the recent thrust of a growing literature we find evidence of material economic pocketbook effects self interest on voting behavior operating alongside symbolic sociotropic and partisan political logics contrary to expectations these self interest effects are not conditional on voter sophistication we conclude that conventional sampling frames may be inappropriate for understanding contemporary democratic contestation over international economic policy

bad loans to good friends money politics and the developmental state in south korea why has the literature on asian development not addressed the issue of money politics in south korea how can we reconcile the view of an efficient developmental state in south korea before 1997 with reports of massive corruption and inefficiency in that same country in 1998 and 1999 politics is central to the answer in this study i make two arguments first money politics was extensive in south korea both during and after the high growth era second political not economic considerations dominated policymaking this study explains both past and present and compares the patterns of money politics in the early post independence era with those that arose after the democratic transition in 1987 while during the park era a balance of power between businessmen and politicians kept corruption from spinning out of control the transition to democracy altered the basic business state relationship allowing business to exert greater influence over policy decisions the political hypothesis advanced in this study suggests a new direction for our research about the developmental state

great powers hierarchy and endogenous regimes rethinking the domestic causes of peace this paper blends recent research on hierarchy and democratization to examine the theoretical and empirical costs of treating regime type exogenously in the literature most identified with studying its impact on international politics it argues that the apparent peace among democratic states that emerges in the aftermath of world war i is not caused by domestic institutional attributes normally associated with democracy instead this peace is an artifact of historically specific great power settlements these settlements shape subsequent aggregate patterns of military conflict by altering the organizational configuration of the system in three critical ways by creating new states by altering hierarchical orders and by influencing regime type in states these claims are defended with a series of tests that show first how the statistical relationship between democracy and peace has exhibited substantial variation across great power orders second that this statistical relationship breaks down with theoretically motivated research design changes and third that great powers foster peace and similar regime types within their hierarchical orders in short the relationship between democracy and peace is spurious the international political order is still built and managed by great powers

perspective from gaussian to paretian thinking causes and implications of power laws in organizations although normal distributions and related current quantitative methods are still relevant for some organizational research the growing ubiquity of power laws signifies that pareto rank frequency distributions fractals and underlying scale free theories are increasingly pervasive and valid characterizations of organizational dynamics when they apply researchers ignoring power law effects risk drawing false conclusions and promulgating useless advice to practitioners this is because what is important to most managers are the extremes they face not the averages we show that power laws are pervasive in the organizational world and present 15 scale free theories that apply to organizations next we discuss research implications embedded in pareto rank frequency distributions and draw statistical and methodological implications

inequity aversion and the international distribution of trade protection one important puzzle in international political economy is why lower earning and less skilled intensive industries tend to receive relatively high levels of trade protection this pattern of protection holds across countries with vastly different economic and political characteristics and is not well accounted for in existing political economy models we propose and model one possible explanation that individual inequity aversion leads to systematic differences in support for trade protection across industries we conduct original survey experiments in china and the united states and provide strong evidence that individual policy opinions about sector specific trade protection depend on the earnings of workers in the sector we also present structural estimates that advantageous and disadvantageous inequality influence support for trade protection in the two countries o ne important puzzle in international political economy is why lower earning and less skilled intensive industries tend to receive relatively high levels of trade protection because this pattern of protection holds even in low income countries for which lower earning and less skilled intensive industries are likely to be comparative advantage sectors it is arguably at odds with the common empirical finding that declining comparative disadvantage industries are more likely to receive protection moreover it is at odds with most theoretical political economy models which tend to either predict consistent with most empirical work that losing sectors from international trade receive more protection or that expanding sectors that gain from greater trade should enjoy more government support existing accounts are generally good at explaining support for winners or for losers they are not however good at

the politics of speculative attacks in industrial democracies recent models of speculative currency crises contend that market expectations of policy behavior can trigger a speculative attack we argue that political processes and partisan objectives inform expectations about the government s commitment to the exchange rate first market actors anticipate periods when the partisan identity of a government may change through an election or a cabinet collapse second party labels provide information to currency traders about the policy objectives of a potential government consequently we contend that the probability of a speculative attack will be higher when markets expect the cabinet to end and when the cabinet dissolution is likely to produce a leftward shift in policy a discrete timesurvival model is used to estimate the probability that a cabinet will dissolve in any given month for sixteen parliamentary democracies from 1970 to 1995 the predicted values are then used as a proxy for market expectations in a model of speculative currency crises

selection and influence interest groups and congressional voting on trade policy studies of the effects of interest groups on congressional roll call voting typically view party and ideology as competing factors and rely on a factoral model of interests or a sectoral model including only interest groups with a direct stake in the vote we depart from that strategy in several ways we define interest groups at the level of standard industrial classification two digit codes and observe the universe of interests for 1979 90 we use measures of geographically and nongeographically based economic interests to estimate the representative s party and ideology we also consider the factor endowments of individuals within a district to examine their impact on floor votes we then investigate the influence of these interests on members party affiliation and ideology as well as a pool of five floor votes on foreign trade using instrumental variables for party and ideology economic interests account for a substantial portion of the variance in all cases and models that also include other explanatory variables are highly accurate in estimating floor votes

mixed signals central bank independence coordinated wage bargaining and european monetary union plans for the european monetary union emu are based on the conventional postulate that increasing the independence of the central bank can reduce inflation without any real economic effects however the theoretical and empirical bases for this claim rest on models of the economy that make unrealistic information assumptions and omit institutional variables other than the central bank when signaling problems between the central bank and other actors in the political economy are considered we find that the character of wage bargaining conditions the impact of central bank independence by rendering the signals between the bank and the bargainers more or less effective greater central bank independence can reduce inflation without major employment effects where bargaining is coordinated but it can bring higher levels of unemployment where bargaining is less coordinated thus currency unions like the emu may require higher levels of unemployment to control inflation than their proponents envisage they will have costs as well as benefits and these will be unevenly distributed among and within the member nations depending on the changes they induce in the status of the bank and of wage coordination

emissions reduction and economic implications of renewable energy market penetration of power generation for residential consumption in the mena region this paper examines the implications of renewable energy re deployment in power generation for residential consumption in the middle east and north africa mena region under various re penetration targets a comparative assessment revealed a great heterogeneity among countries with turkey dominating as the highest emitter at the sub regional level the middle east sub region contributes more than double the ghg emissions estimated for the gulf and north africa sub regions with all sub regions achieving reductions in the range of 6 38 depending on the re target penetration and promising up to 54 savings on investment excluding positive externalities associated with the offset of greenhouse gas ghg emissions savings

chasing phantoms the political economy of ustr trade barriers though usually considered welfare reducing are globally ubiquitous in light of the enormous clash between what is and what ought to be researchers have begun addressing the question of why countries so consistently pursue such apparently counterproductive policies

the reductionist gamble open economy politics in the global economy international political economy ipe should transition to third wave scholarship because open economy politics oep which dominates current american ipe scholarship can generate inaccurate knowledge oep can produce inaccurate knowledge because it studies domestic politics in isolation from international or macro processes this methodological reductionism is often inappropriate for the phenomena ipe studies because governments inhabit a complex social system as a result the political choices that oep strives to explain are typically a product of the interplay between domestic politics and macro processes when oep omits causally significant macro processes from empirical models the models yield biased inferences about the domestic political relationships under investigation although scholars tolerated such errors when the gains from oep were large these errors are less tolerable now that oep has matured consequently the field should transition toward research that is nonreductionist problem driven and pluralistic

the solow productivity paradox what do computers do to productivity 1 you don t see computers everywhere in a meaningful economic sense computers and information processing equipment are a relatively small share of gdp and of the capital stock 2 you only thinkyou see computers everywhere government hedonic price indexes for computers fall too fast according to this position and therefore measured real computer output growth is also too fast 3 you may not see computers everywhere but in the industrial sectors where you most see them output is poorly measured examples are finance and insurance which are heavy users of information technology and where even the concept of output is poorly specified 4 whether or not you see computers everywhere some of what they do is not counted in economic statistics examples are consumption on the job convenience better user interface and so forth 5 you don t see computers in the productivity statistics yet but wait a bit and you will this is the analogy with the diffusion of electricity the idea that the productivity implications of a new technology are only visible witlh a long lag 6 you see computers everywhere but in the productivity statistics because computers are not as productive as you think here there are many anecdotes such as failed computer system design projects but there are also assertions from computer science that computer and software design has taken a wrong turn 7 there is no paradox some economists are counting innovations and new products on an arithmetic scale when they should count on a logarithmic scale

the partisan paradox and the u s tariff 1877 1934 whereas historical accounts of u s tariff policy from 1877 to 1934 emphasize the pivotal role of parties previous quantitative studies have failed to identify significant partisan effects a formal model of policymaking in which strong parties aggregate voters preferences provides empirical equations to test for partisan effects subsequent time series analysis shows that even after controlling for interest group demands partisan control of government did significantly affect the tariff moreover during the period under study the two political parties enacted tariff policies that benefited different sets of producer groups at the expense of others thus political institutions did play a significant role in shaping the interests that influence u s foreign economic policy

democratic institutions and exchange rate commitments since the collapse of the bretton woods system countries have been able to choose from a variety of exchange rate arrangements we argue that politicians incentives condition the choice of an exchange rate arrangement these incentives reflect the configuration of domestic political institutions particularly electoral and legislative institutions in systems where the cost of electoral defeat is high and electoral timing is exogenous politicians will be less willing to forgo their discretion over monetary policy with a fixed exchange rate in systems where the costs of electoral defeat are low and electoral timing is endogenous politicians are more likely to adopt a fixed exchange rate regime consequently differences in domestic political systems can help account for variations in the choice of exchange rate arrangements we test this argument using constrained multinomial logit and binomial logit on a sample of twenty democracies over the period 1974 95 domestic political institutions have a significant effect on exchange rate regime choice even after controlling for systemic macroeconomic and other political variables

an econometric analysis of choice of mortgage design in the united kingdom the research seks to better understand the choice of mortgage design by households in the united kingdom family expenditures survey data is used to test the various hypotheses on the determinants of the choice between an endowment and a repayment mortgage a bivariate probit model with sample selection is estimated to detect any likely selectivity bias arising out of tenure choice the theoretical modelling reflects the behaviour of liquidity constrained households comparing comparative periodic mortgage costs and households concerned with the oppurtunity cost of equity in a property actual choices appear to reflect the impact of nominal interest rates income and cash flow considerations there is little direct evidence that the choice of mortgage repayment vehicle is motivated by portfolio design there is some tentative evidence of supply side pressure on endowment mortgage take up

remodeling the competition for capital how domestic politics erases the race to the bottom this paper proposes and tests a new formal model of the competition for capital using the analogy of a tournament as a substitute for the race to the bottom model our key insight is that political costs that accompany legislating have both direct and indirect effects on the likelihood and scale of reforms while countries with higher political costs are less likely themselves to enact reforms the presence of these costs also reduces competing countries incentives to reform regardless of their own political costs domestic politics therefore mitigates the pressures for downward convergence of tax policy despite increased capital mobility we examine the capital tax policies in oecd countries during the period from 1980 to 1997 and find that states are sensitive to tax reforms in competitor countries although their responses to reforms are mediated by their own domestic costs to reform we define two potential sources of political costs of reform transaction costs due to the presence of multiple veto players in the legislative process and constituency costs due to ideological opposition to policy changes that benefit capital our evidence reveals that a reduction in these costs either domestically or abroad increases the likelihood that a country enacts tax reforms hat are the policy consequences of the elimination of various barriers to international capital and labor mobility robert frost in mending wall instructed that good fences make good neighbors scholars have increasingly expressed this sentiment s converse i e the pessimistic viewpoint that as the mobility of factors of production increases international competition assumes a beggar thy neighbor character when fences separate countries and make it difficult for factors of production to move from country to country governments can operate essentially as monopolistic suppliers of services governments can extract a price from the owners of productive resources in the form of taxes or can place regulatory restrictions on production without fear that factors of production will emigrate when the fences fall and governments must compete with each other for the same resources a state s or country s ability to tax or regulate diminishes in the extreme countries lose sovereignty over domestic policymaking e g andrews 1994 and lee and mckenzie 1989 the model that most scholars employ implicitly or explicitly to understand international or interstate competition is known commonly by its central prediction the race to the bottom e g oates 1972

are energy conservation policies effective without harming economic growth in the gulf cooperation council countries abstract this study explores the fossil fuels electricity consumption growth of the gross domestic product gdp relationship in the six gulf cooperation council gcc countries for the period 1980 2012 the aim of this study is to examine whether energy conservation policies are appropriate for these countries to reduce their high levels of electricity consumption the autoregressive distributed lag ardl and the toda yamamoto dolado lutkepohl tydl methodologies were employed to investigate this relationship the ardl results revealed that fossil fuels electricity consumption has a long run positive effect on gdp growth in the gcc countries however the tydl granger causality revealed different causality relationships among the countries a bi directional causality was found between fossil fuels electricity consumption and gdp growth in bahrain and the united arab emirates uae while one way causality from fossil fuels electricity consumption to gdp growth was found in oman and qatar on the other hand no causality was concluded between the variables in kuwait and saudi arabia from the results it is clear that energy conservation is not an ideal policy for the bahrain uae oman and qatar because it will have a negative consequence on their output however this policy can be implemented in kuwait and saudi arabia since it will not harm their output

societal preferences partisan agents and monetary policy outcomes if different producer groups have divergent interests concerning macroeconomic policies how do societal preferences translate into state policy outcomes i develop and test a party as agent framework for understanding the importance of societal preferences with regard to monetary policy under capital mobility following the principal agent model political parties function as agents for different societal principals rightist parties tend to represent internationally oriented business groups with preferences for monetary convergence while leftist parties do the same for domestically oriented groups preferring monetary autonomy under capital mobility i present statistical evidence showing that oecd leftist governments have been associated with more monetary autonomy and currency variability than their rightist counterparts even after controlling for basic economic indicators such as inflation the statistical evidence also shows that societal group size tends not to explain either autonomous monetary policy choices or exchangerate stability thus even large and wealthy societal groups may be unable to obtain their preferred policy outcome when their respective partisan agents do not hold government power

the reaction of private interests to the 1934 reciprocal trade agreements act in recent research on the 1934 reciprocal trade agreements act rtaa there has been no examination of the reaction of private actors to the rtaa did producer groups and investors in 1934 believe the democratic rtaa was the solution to republican protectionism as institutional analyses of the rtaa claim or did they realize the rtaa was no magic bullet against a return of protectionism as skeptics argue archival data suggests that many producer groups believed the rtaa would result in durable liberalization but that fewer understood the likely effects of its specific features an event study of investor reaction to the rtaa reveals that export dependent firms experienced a significant positive stock return increase on news of the rtaa while heavily tariff protected firms experienced a significant stock decline albeit several months later

the causes of welfare state expansion deindustrialization or globalization an influential line of argument holds that globalization causes economic uncertainty and spurs popular demands for compensatory welfare state spending this article argues that the relationship between globalization and welfare state expansion is spurious and that the engine of welfare state expansion since the 1960s has been deindustrialization based on cross sectional time series data for fifteen oecd countries the authors show that there is no relationship between globalization and the level of labor market risks in terms of employment and wages whereas the uncertainty and dislocations caused by deindustrialization have spurred electoral demands for welfare state compensation and risk sharing yet while differential rates of deindustri alization explain differences in the overall size of the welfare state its particular character in terms of the share of direct government provision and the equality of transfer payments is shaped by government partisanship the argument has implications for the study and the future of the welfare state that are very different from those suggested in the globalization literature

funding self sustaining development the role of aid fdi and government in economic success this article challenges a long held development policy assumption that aid and foreign direct investment fdi serve as substitutes or complements in accelerating the development of the world s poorer countries we show both theoretically and empirically that aid and fdi affect development differently aid contributes powerfully to both economic growth and human development and the higher the level of human capital in a country the more aid contributes by contrast fdi at best has no effect on economic growth and actually slows the rate of human development in less developed countries we find no evidence that the degree of democratic responsiveness in government conditions the effectiveness of either aid or fdi although we do find that democracy independently increases human development in all but the most developed countries our results demonstrate that fdi and aid are not and cannot be substitutes in the development of the world s poorer countries nor even can they be thought of as complements certainly not at mid to low levels of development in the end poor countries need democracy and aid not fdi we are extremely grateful to susan rose ackerman gustav ranis frances rosenbluth kenneth scheve and participants at the leitner political economy seminar at yale university in december 2003 for very helpful comments we also received valuable suggestions from two anonymous reviewers stephen kosack would like to thank the national science foundation for the support of a graduate research fellowship

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

economic interests and regional trading arrangements the case of nafta this article examines lobbying in the united states on the north american free trade agreement nafta i argue that economies of scale and production sharing across borders create incentives for firms to seek regional trade liberalization statistical analysis demonstrates that sectors with these characteristics were more likely to lobby for free trade in north america these sectors were also exposed to free trade more rapidly under the tariff phasing schedule in the nafta treaty however corporate restructuring to rescale production for the regional market and to increase offshore assembly presented adjustment costs for u s workers which created divisions between labor unions and their employers i conclude that regional arrangements are an attractive mechanism to liberalize trade for firms in need of larger than national markets to take advantage of economies of scale or to develop production sharing networks

the political economy of imf lending in africa why has imf lending achieved such poor results in africa is it because the fund imposes the wrong conditions or because it fails to enforce them analysis of monthly data on 53 african countries from 1990 to 2000 shows that the imf s loans for reform contract lacks credibility because donor countries intervene to prevent rigorous enforcement countries that have influence with developed country patrons as measured by u s foreign aid membership in postcolonial international institutions and voting profiles in the un are subject to less rigorous enforcement shorter program suspensions they have more frequent program suspensions because they violate their conditions more often the imf will have to become more independent in order to become an effective champion of reform

economic insecurity and social policy expansion evidence from interwar europe what is the impact of economic insecurity on the development of institutions of social insurance existing studies have examined this question by exploring the impact of various measures of economic volatility on aggregate government expenditures or revenues these aggregate data are however an imperfect proxy of the character of institutions of social protection to overcome the limitations of earlier studies this article explores the conditions under which economic insecurity leads to the extension of the level of social insurance coverage i argue that economic insecurity sharpens a sectoral cleavage between coalitions in high risk and low risk sectors workers and some employers in high risk sectors will favor the introduction of social insurance institutions characterized by broad levels of coverage and a high redistribution of costs across occupations in contrast a cross class alliance in low risk sectors will oppose proposals aiming at the introduction of redistributive social policies fearing that these policies will turn them into subsidizers of high risk industries a redistributive social insurance policy will be introduced only if the high risk coalition is larger the article tests both the micro and macro level implications of this theory by examining the development of unemployment insurance policies in interwar europe i gratefully acknowledge comments from carles boix peter gourevitch and two anonymous referees many thanks to stefano bartolini john fitzgerald and michael tomz for sharing data with me

foreign aid and statehood in africa has foreign aid destroyed state institutions in africa african states depend on development assistance to conduct basic government operations yet few of these states are well governed or effective at providing public goods the two trends mounting foreign aid and static or diminishing state performance raise an obvious question is aid dependency contributing to misrule and state failure in africa many critics argue the two phenomena are related i find they are not my analysis fails to show a negative association between aid receipts and two measures of democracy and economic freedom instead the evidence is consistent with a small positive relationship between aid and these indicators of state performance since the international community seems bent on reducing foreign aid an important issue is how african states can maintain and improve their performance with less foreign assistance

distinguished lecture on economics in government data quality and public policy the public policy use of statistical data has increased markedly over the last half century today this country uses statistical series to redistribute income and to fine tune the economy we mandate use of statistical series in a number of our country s laws and we use data to evaluate policy alternatives competing interpretations of statistics on income inflation and unemployment figure prominently in our election campaigns we use statistics to evaluate risk in legislative policy on toxicity and the environment and we use statistics in our governmental efforts to contain the cost of health care under these circumstances the federal government s data system must produce data that are of high enough quality for the demands that are placed upon them but how can we maintain a data system of high quality in an increasingly complex society while at the same time cutting back on government expenditures 1 the quality of a statistical indicator is sometimes elusive and often difficult to define effective measurement requires an underlying conceptual framework and careful identification of the phenomenon to be estimated in the statistical series consider for a moment the task of quality management in a government statistical agency like the u s bureau of labor statistics bls our task is to measure economic and social phenomena which frequently change as does society s view of the 1 for example the appropriations for the bureau of labor statistics have been reduced by nearly 14 5 million over the last 3 years due to deficit reduction legislation these reductions taken proportionately in all bls programs were 9 743 million in fiscal year 1988 2 839 million in fiscal year 1989 and 1 827 million in fiscal year 1990

the international labor organization and the welfare state institutional effects on national welfare spending 1960 80 national welfare programs are importantly affected by models of welfare activity institutionalized at the global level this article examines the impact of the welfare regime advocated by and within the international labor organization ilo countries that have recently ratified ilo conventions related to welfare show increased growth in spending net of national characteristics subanalyses show that the effects of ilo ratification are strong in the industrialized capitalist democracies particularly where prior welfare spending is low and the working class has a weakly institutionalized role in policymaking ilo ratification seems disconnected from spending in the less developed countries legislative case studies point to similar patterns these findings suggest that international norms contribute to policy where they offer compelling models that powerful actors can use to legitimate policy innovation

reversal of fortunes democratic institutions and foreign direct investment inflows to developing countries does increased democracy promote or jeopardize foreign direct investment fdi inflows to less developed countries we argue that democratic institutions have conflicting effects on fdi inflows on the one hand democratic institutions hinder fdi inflows by limiting the oligopolistic or monopolistic behaviors of multinational enterprises facilitating indigenous businesses pursuit of protection from foreign capital and constraining host governments ability to offer generous financial and fiscal incentives to foreign investors on the other hand democratic institutions promote fdi inflows because they tend to ensure more credible property rights protection reducing risks and transaction costs for foreign investors hence the net effect of democracy on fdi inflows is contingent on the relative strength of these two competing forces our argument reconciles conflicting theoretical expectations in the existing literature empirical analyses of fifty three developing countries from 1982 to 1995 substantiate our claims we find that both property rights protection and democracy related property rights protection encourage fdi inflows after controlling for their positive effect through property rights protection democratic institutions reduce fdi inflows these results are robust against alternative model specifications statistical estimators and variable measurements

origins of the federal reserve system international incentives and the domestic free rider problem from the civil war to 1914 the united states had one of the worst e nancial systems in the world the dominant institutional feature of the system was the absence of a central bank and its most salient performance characteristics were the recurrence of banking panics and severe seasonal interest rate e uctuations these e nancial problems were economically costly panics were accompanied by sharp declines in the money supply reduced economic activity and increased unemployment and business failures in 1913 congress created the federal reserve system to safeguard the nation from panics and smooth out interest rate seasonals in more general terms the federal reserve was established to provide the national public good of e nancial system stability in this study i explain how american society overcame the collective action problems that normally constrain the production of public goods to inadequate levels in other words the article is about the political effort that produced an infrastructural cornerstone of the modern u s economy in the face of incentives that should have left few people with sufficient motivation to pay for the improvement i bring to bear a joint products selective incentives argument to explain the voluntary collective action behind the federal reserveact 1 the lobbying effort was aboutsolving thepanic problem tobe sure but becausethisexpected benee t approximated a societywide public good it did not on its own motivate collective action instead the united states faced a second problem of e nancial organization before 1914 and it was this problem that created a private inducement to lobby for the federal reserve the structure of the domestic e nancial machinery contributed not only to instability at home but also to the near complete absence of the u s dollar in global e nancial affairs indeed the united states was the only major trading country whose currency did not function as an international currency before 1914 the new this article is a revision of a paper delivered at the 1996annual convention of the southern economic association washington d c 23 25 november i thank michael bordo marc busch william r clark benjamin j cohen barry eichengreen jeffry frieden william keech stephen krasner charles lipson jameslivingston louispauly georgeselgin bethsimmons richardtimberlake danielverdier eugene n white and two anonymous reviewers for very helpful comments 1 see olson 1965 and sandler 1992

economic interests party and ideology in early cold war era u s foreign policy although it is widely acknowledged that economic interests influence the politics of trade policy most research on international relations treats security issues differently do conflicting economic interests shape political debate over foreign policy even when security issues are highly salient to answer this question i test a range of hypotheses about conflicting interests in the economic stakes of u s foreign policy during the early cold war era i present evidence that economic interests in their home states were closely related to senators voting patterns on foreign policy issues these patterns hold across economic and security issues i also find that political parties play an important mediating role making senators more or less receptive to various economic interests

the globalization of liberalization policy diffusion in the international political economy one of the most important developments over the past three decades has been the spread of liberal economic ideas and policies throughout the world these policies have affected the lives of millions of people yet our most sophisticated political economy models do not adequately capture influences on these policy choices evidence suggests that the adoption of liberal economic practices is highly clustered both temporally and spatially we hypothesize that this clustering might be due to processes of policy diffusion we think of diffusion as resulting from one of two broad sets of forces one in which mounting adoptions of a policy alter the benefits of adopting for others and another in which adoptions provide policy relevant information about the benefits of adopting we develop arguments within these broad classes of mechanisms construct appropriate measures of the relevant concepts and test their effects on liberalization and restriction of the current account the capital account and the exchange rate regime our findings suggest that domestic models of foreign economic policy making are insufficient the evidence shows that policy transitions are influenced by international economic competition as well as the policies of a country s sociocultural peers we interpret the latter influence as a form of channeled learning reflecting governments search for appropriate models for economic policy

room to move international financial markets and national welfare states a central research question in international political economy concerns the influence of financial markets on government policy outcomes to what extent does international capital mobility limit government policy choices i evaluate the relationship between international financial markets and government policy outcomes with a focus on the government bond market in developed democracies evidence includes interviews with financial market participants and a cross sectional time series analysis of the determinants of interest rates this evaluation suggests that governments of developed democracies face strong but narrowly defined financial market pressures financial market participants are concerned with a few macroeconomic policy indicators including inflation rates and government deficit gdp ratios but not with micropolicy indicators such as the distribution of government spending across functional categories in these areas governments retain policymaking autonomy i conclude by exploring the role of financial market influences within domestic politics and offering suggestions for further research

institutions in international relations understanding the effects of the gatt and the wto on world trade the general agreement on tariffs and trade gatt and the world trade organization wto have been touted as premier examples of international institutions but few studies have offered empirical proof this article comprehensively evaluates the effects of the gatt wto and other trade agreements since world war ii our analysis is organized around two factors institutional standing and institutional embeddedness we show that many countries had rights and obligations or institutional standing in the gatt wto even though they were not formal members of the agreement we also expand the analysis to include a range of other commercial agreements that were embedded with the gatt wto using data on dyadic trade since 1946 we demonstrate that the gatt wto substantially increased trade for countries with institutional standing and that other embedded agreements had similarly positive effects moreover our evidence suggests that international trade agreements have complemented rather than undercut each other an earlier version of this article was presented at the 99th annual meeting of the american political science association philadelphia august 28 31 2003 we thank tim buthe joanne gowa miles kahler andrew rose arthur stein richard steinberg and seminar participants at stanford university the university of chicago pipes the university of california los angeles the university of california san diego and the university of virginia for many helpful comments we especially thank claire adida ashley conner moonhawk kim erin krampetz james morrison mike nardis natan sachs rachel rubinfeld and jessica weeks for excellent research assistance we are grateful for financial support from the national science foundation career grant ses 0548285 to tomz the stanford center for international development and the vice provost for undergraduate education at stanford

partisan and electoral motivations and the choice of monetary institutions under fully mobile capital central bank independence and pegged exchange rates have each been viewed as solutions to the inflationary bias resulting from the time inconsistency of discretionary monetary policy while it is obvious that a benevolent social planner would opt for such an institutional solution it is less obvious that a real world incumbent facing short term partisan or electoral pressures would do so in this article i model the choice of monetary institutions from the standpoint of a survival maximizing incumbent it turns out that a wide range of survival maximizing incumbents do best by forfeiting control over monetary policy while political pressures do not in general discourage monetary commitments they can influence the choice between fixed exchange rates and central bank independence i highlight the importance of viewing fiscal policy and monetary policy as substitutes and identify the conditions under which survival maximizing incumbents will view fixed exchange rates and central bank independence as substitutes in so doing i provide a framework for integrating other contributions to this volume

rulers of the game central bank independence during the interwar years central bank independence is associated with restrictive monetary choices that can be deflationary within fixed exchange rate regimes because central banks act to counteract domestic inflation they put a premium on domestic price stability at the expense of international monetary stability evidence from fifteen countries between 1925 and 1938 shows that the more independent central banks took more deflationary policies than were necessary for external adjustment central banks in general were more restrictive under left wing governments than they were under more conservative regimes and often were more restrictive than required for external equilibration this suggests that policies of independent central banks designed to enhance domestic price stability may force deflationary pressures onto other states in the system and potentially destabilize a fixed exchange rate regime

choice of mortgage instrument liquidity constraints and the demand for housing debt in the uk the research uses microdata to estimate reduced form mortgage demand equations based on truncated regressions dissagregated by choice of mortgage instrument the choice is between a standard annuity mortgage and a balloon type mortgage the endowment the estimates are used to indicate the differential impact of credit market rationing and financial liberalization on households the results indicate significant variations in mortgage demand by choice of mortgage instrument econometric testing demonstrates that the choice between an endowment and a repayment mortgage can be used as an exogenous indicator of liquidity and portfolio positions and different user costs of owner occupation

should the cost of living index provide the conceptual framework for a consumer price index in some countries the cost of living col index serves as the conceptual framework for the cpi but it has been rejected in others this paper reviews issues that have arisen in the statistical agency debate and in the economics literature on the col index including rhetorical matters which have influenced the debate i contend that col theoiy is useful as a decision making framework in estimating components of the cpi and that col index theory provides appropriate guidance for measuring consumer inflation contrary to the view that has been adopted for the european hicp and expressed by an advisory committee for the rpi in several countries the united states netherlands sweden the theory of the cost of living col index provides the conceptual framework for the country s consumer price index cpi see united states department of labor 1997 balk 1994 and dalen 1999 others reject the cost of living index framework an example is the australian bureau of statistics 1997 rejection of the col index is also explicit in an rpi advisory committee recommendation in the united kingdom in still other countries canada being an example official documents for the cpi are ambiguous about the role of the col index statistics canada 1995 the international guideline for consumer price indexes the ilo manual turvey 1989 does not even mention the col index the question has taken on heightened interest recently part of the stimulus comes from the european union s relatively new harmonised indexes of consumer prices hicp for the hicps eurostat has rejected the col

checks and balances private information and the credibility of monetary commitments the authors develop and test several new hypotheses about the anti inflationary effect of central bank independence and exchange rate pegs in the context of different institutions and different degrees of citizen information about government policies theory provides strong reason to believe that while central bank independence will prove more effective as a commitment mechanism in countries where multiple players in government have veto power checks and balances the number of veto players will have no effect on the credibility of exchange rate pegs conversely the authors argue that central bank independence does not solve the problems of commitment that arise when citizens are imperfectly informed about the contribution of government policy to inflation exchange rate pegs however mitigate these problems the authors present extensive evidence from cross country tests using newly developed data that provide strong support for their propositions

public inflation aversion and the political economy of macroeconomic policymaking do the macroeconomic priorities of citizens differ across countries if so what accounts for this variation and what are its consequences for explanations of the choice of monetary institutions macroeconomic policy and international monetary cooperation this article uses survey data from twenty advanced economies to examine individual preferences about macroeconomic priorities the analysis establishes three key findings first the results suggest that economic context defined by inflation and unemployment performance has a substantial impact on the public s economic objectives in a way that is broadly consistent with the specification of utility loss functions in the theoretical political economy literature second the results suggest that there is significant cross country variation in inflation aversion controlling for economic context third some of this variation is accounted for by national level factors affecting the aggregate costs of inflation and unemployment these results have significant implications for optimal monetary policymaking the explanation of variation in economic outcomes and for accounts of the choice of institutional frameworks for policymaking i thank the bank of england the center for basic research in the social sciences and the institution for social and policy studies for research support and jim alt andrew bailey bill bernhard lawrence broz john freeman jeff frieden jim granato shigeo hirano david lake jeff lax simon price rose razaghian ron rogowski david stasavage gabriel sterne mike tomz jim vreeland the editor and two anonymous reviewers for helpful comments all views expressed are those of the author and do not represent those of the bank of england

government spending and public support for trade in the oecd an empirical test of the embedded liberalism thesis according to the embedded liberalism thesis governments committed to free trade provide insurance and other transfers to compensate those who lose economically from expanded trade the goal of this spending is to maintain public support for trade liberalization we provide a micro level test of the critical assumption behind the embedded liberalism thesis that government programs designed to protect individuals harmed by imports reduce opposition to free trade our micro results have important implications for the macro relationship between trade and government spending which we also test we find empirical support for the embedded liberalism thesis in both our micro and macro level analyses earlier versions of this article were presented at the midwest political science association s 2002 meeting and at the university of illinois during summer 2003 we thank the respective panel and seminar participants for their feedback in addition we want to acknowledge valuable comments from william bernhard rebecca blank kerwin charles alan deardorff john dinardo john freeman brian gaines jim granato nathan jensen william keech layna mosley robert pahre ken scheve marina whitman two anonymous reviewers and lisa martin they of course are not responsible for any errors

political parties and monetary commitments we argue that political parties will choose monetary institutions in order to help them win elections and retain office increased levels of economic openness in the industrial democracies have complicated the pursuit of office by altering the policy preferences of constituents and decreasing the ability of cabinet ministers to deliver promised economic outcomes we contend that monetary commitments can help political parties manage diverse constituent interests restore policy effectiveness and ultimately maintain their position in office therefore we expect that fixed exchange rates and central bank independence can improve cabinet durability especially under conditions of economic openness in the first section we discuss how fixed exchange rates and central bank independence can insulate cabinets from the political shocks of increased economic openness to determine the political value of these commitments we then test the effect of exchange rate commitments and central bank independence on cabinet durability in the second section in the third section we use the results of our statistical models to generate expected cabinet durability for the countries in our sample under alternative institutional configurations by comparing the expected durabilities we show that most monetary reforms have helped or at least not hurt expected cabinet durability

the origins of central banking solutions to the free rider problem certain domestic institutions are sources of international power by way of their abilities to encourage investment and to mobilize social resources in wartime for example states with democratic institutions almost always win the wars they e ght a regularity known as the democratic advantage 1 this result is intriguing since it rests on intuition about the effects of military competition on domestic institutions rivalry among states may put pressure on sovereigns to provide the political foundations for secure markets in order to enlarge future military capabilities in this article i address the role of war in inducing domestic institutions that allowed governments to credibly commit to promises to pay their debts a probable source of democracies edge in war rather than investigate the entire range of protections affected by democratic institutions a life s endeavor as the work of douglass north attests i focus on a single e nancial element of the reforms the innovation of central banking britain s superior e nancial economic and military performance after 1689 rested in large part on the establishment of the bank of england 2 the central bank provided a commitment technology that improved the government s ability to borrow a need impelled by intense military competition 3 my motivation derives from puzzles concerning the origins and the diffusion of credibility enhancing institutions like central banks institutions resolve collective action problems but institutions themselves are public goods meaning that their origins are subject to the same dilemmas they are meant to resolve 4 what then explains the incentives of self interested and free riding individuals to contribute to

a bayesian approach to assessing the robustness of hedonic property value studies hedonic price models are widely employed to estimate implicit prices for bundled attributes residential property value studies dominate these applications using a representative cross sectional property value data set we employ bayesian methods to translate a range of priors in covariate selection typical of hedonic property value studies into a range of posterior estimates we also formulate priors regarding measurement error in individual covariates and compute the ranges of resulting posterior means finally we empirically demonstrate that a greater and more systematic use of prior information drawn from one s own data and from other studies can break the collinearity deadlock in this data

integrating sustainable energy strategy with the second development plan of kuwait abstract the vision set for the second development plan 2015 2020 dp15 20 is to transform kuwait into a financial and commercial center by 2035 the dp15 20 addresses various sectors in the country including the energy sector which is tackled by presenting the overall goals of the oil and electricity sectors in terms of their respective capacities and performances the plan does not explicitly tackle energy sustainability development this work has proposed a potential sustainable energy strategy scenario and discusses the integration of the strategy within the dp15 20 the strategy is based on supply diversification to meet 15 of the demand from renewable sources by 2030 electricity energy consumption reduction of 12 in the building sector and co2 emission reduction of 33 by 2035

international and domestic constraints on political business cycles in oecd economies the effect of increased capital mobility on the national control of macroeconomic policy continues to be a topic of debate empirical contributions to this debate share the assumption that domestic macroeconomic policy is driven by either partisan or countercyclical motivations and that the effects of international financial flows have roughly similar effects in all countries this article reevaluates the integration hypothesis in a framework in which manipulations of the macroeconomy derive from opportunistic motivations the article emphasizes the ways in which prior institutional choices effect the way these motivations are translated into actions evidence from individual country and pooled time series tests suggests that opportunistic cycles are less likely to occur when 1 a government maintains a fixed exchange rate in the presence of highly mobile capital or 2 when the central bank enjoys above average independence

a new world order explaining the international diffusion of the gold standard 1870 1913 abstract the gold standard gradually became an international monetary regime after 1870 similarly some nations in the european union are waiting to adopt the euro while others have joined immediately what explains the timing of exchange rate regime adoption to find out the international diffusion of the gold standard is analyzed duration analysis shows that network externalities operating through trade channels the desire to decrease borrowing costs on international capital markets and the level of development matter some evidence shows that the level of exchange rate volatility or inflationist agricultural interests did not matter for the timing of adoption

the impact of rental properties on the value of single family residences abstract this study examines the effects that single family rental properties in a residential neighborhood have on the value of single family residences in that area the analysis blends real estate valuation concepts with evidence found in the housing maintenance literature and urban succession theory to develop testable hypotheses regarding the property specific proximity related and neighborhood wide impacts of rental properties on property values the data used to test the hypotheses include the tenure status of 23 119 single family residences and 1 162 single family sales regression results support all three hypotheses although numerous studies on the value impacts of other externalities have been published this is the first study to examine the separation of property rights the results of this study provide additional insights into housing maintenance and also have implications for neighborhood zoning regulations

capital mobility and the origins of stock markets i illustrate the accepted though hardly researched idea that political institutions play a role in locking in factor specificity across sectors space and borders i use the emergence of modern capital markets in the nineteenth century a process that threatened to redeploy financial resources away from land and traditional sectors to heavy industry as a test case to ascertain the degree of domestic financial capital mobility in nine advanced industrialized countries the main finding is that cross national variations in financial capital mobility holding constant the level of economic development reflect the degree of state centralization

who supports global economic engagement the sources of preferences in american foreign economic policy in this article we bring together opposing international relations theories to better understand u s foreign policy in particular foreign trade and aid using votes in the u s house of representatives from 1979 2004 we explore different theoretical predictions about preferences for foreign economic policy we assess the impact of domestic factors namely political economy and ideological preferences versus foreign policy pressures our three main results highlight the differential effect of these factors in the two issue areas first aid preferences are as affected by domestic political economy factors as are trade preferences second trade preferences but not economic aid ones are shaped by the president s foreign policy concerns for economic aid domestic political economy factors matter more than foreign policy ones third aid preferences are shaped more by ideological factors than are trade ones but ideology plays a different substantive role in each different constituencies support aid and trade this finding has implications for foreign policy substitutability the internationalist coalition in u s foreign policy statist theories of foreign policy and the connection between public opinion and legislative voting

mobile capital domestic institutions and electorally induced monetary and fiscal policy the literature on global integration and national policy autonomy often ignores a central result from open economy macroeconomics capital mobility constrains monetary policy when the exchange rate is fixed and fiscal policy when the exchange rate is flexible similarly examinations of the electoral determinants of monetary and fiscal policy typically ignore international pressures altogether we develop a formal model to analyze the interaction between fiscal and monetary policymakers under various exchange rate regimes and the degrees of central bank independence we test the model using data from oecd countries we find evidence that preelectoral monetary expansions occur only when the exchange rate is flexible and central bank independence is low preelectoral fiscal expansions occur when the exchange rate is fixed we then explore the implications of our model for arguments that emphasize the partisan sources of macroeconomic policy and for the conduct of fiscal policy after economic and monetary union in europe

asset specificity and the political behavior of firms lobbying for subsidies in norway previous research into endogenous trade policy has described extensively the political incentives of firms with specific assets but no studies have shown directly that firms behave as predicted we adopt insights from transaction costs economics to develop measures of asset specificity and to investigate how variation in these measures affects the political behavior of firms in particular we examine the lobbying choices of norwegian firms in the 1980s given available subsidy funds from norway s oil boom and some government decisions in the 1970s firms with more specific assets faced potentially greater losses from adjusting to new activities in the face of competitive pressures and thus had greater incentives to lobby for subsidies to protect themselves joint contacting of parliament and government on behalf of firm interests by representatives of both management and labor should be particularly likely where firms had specific assets data analysis shows that asset specificity as indicated by r d intensity and job immobility predicts joint contacting independently of plausible alternative explanatory variables like firm size and export orientation

housing depreciation and aging bias in the consumer price index i use hedonic regression methods to estimate average rental housing physical depreciation for areas of the united states i estimate downward quality bias of the u s consumer price index cpi caused by rental housing physical depreciation and i develop methods to correct the cpi for such aging bias my physical depreciation estimates imply that recent percentage changes in the u s cpi shelter cost indexes are downward biased by 3 to 4 annually such bias is nonnegligible because recent annual changes in the cpi shelter cost indexes have ranged between 3 5 and 6 8 for various regions my results also imply that rent controlled housing has depreciated faster than other rental housing

the magic bullet the rtaa institutional reform and trade liberalization the reciprocal trade agreements act rtaa of 1934 has long been heralded as a simple institutional reform with revolutionary consequences namely by changing the trade policymaking process in the united states the rtaa is held responsible for the dramatic liberalization in u s policy beginning in the 1930s and 1940s this article takes issue with this conventional wisdom i argue that the standard accounts which emphasize the importance of delegation for overcoming logrolling in congress or for facilitating reciprocity in international trade negotiations fail to provide an adequate explanation for just how the institutional innovation was achieved and sustained in the face of protectionist opposition i suggest instead that trade liberalization was driven by exogenous changes in party constituencies and societal preferences that had crucial effects on congressional votes to extend the rtaa authority and liberalize trade after 1945 the preservation of the rtaa program was symptomatic rather than causal as a consequence it may well be abandoned in the future the evolution of u s trade policy has been and will continue to be powerfully shaped by changes in the preferences of societal groups and in the positions taken by parties on the trade issue

globalization and the decline of the welfare state in less developed countries why have trends in government welfare spending in developing countries diverged from those in developed countries i address this question by investigating the effects of capital and trade flows on government welfare spending in fifty three developing countries using an original measure of labor power in developing countries i test the links between international markets labor s political strength and the welfare state i argue that labor s collective action problems caused by large populations of low skilled and surplus workers offset labor s potential political gains from globalization i show that when the proportion of low skilled workers in a nation is high globalization will lead to a decline in welfare spending most significantly the results suggest that in nations where labor market institutions are not yet well developed government social welfare spending is constrained by international market forces

why are some people and countries more protectionist than others we analyze two cross country data sets that contain information on attitudes toward trade as well as a broad range of socio demographic and other indicators we nd that pro trade preferences are signi cantly and robustly correlated with an individual s level of human capital in the manner predicted by the factor endowments model preferences over trade are also correlated with the trade exposure of the sector in which an individual is employed individuals in non traded sectors tend to be the most pro trade while individuals in sectors with a revealed comparative disadvantage are the most protectionist third an individual s relative economic status has a very strong positive association withpro trade attitudes finally non economic determinants in the form of values identities and attachments play an important role in explaining the variation in preferences over trade high degrees of neighborhood attachment and nationalism patriotism are associated withprotectionist tendencies c

exploring the relationship between urbanization energy consumption and co2 emission in mena countries abstract this study explored the relationship between urbanization energy consumption and co2 emission in the mena countries the panel model was utilized taking the period 1980 2009 into consideration pedroni cointegration test results showed that urbanization energy consumption and co2 emission were cointegrated the dynamic ols results also showed that there was a long run bi directional positive relationship between urbanization energy consumption and co2 emission however the significance of the long run relationship between urbanization energy consumption and co2 emission varied across the countries based on their level of income and development moreover long and short run bi directional causal relationships were found between the variables based on the granger causality test results from the results of this study it is important for the urban planners and policy makers in the mena countries to slow the rapid increase in urbanization the level of energy consumption and co2 emission in the mena countries increased more than double thus slowing down the urbanization level can help reduce the level of pollution and energy consumption in addition the increased energy efficiency implementation of energy savings projects energy conservation and energy infrastructure outsourcing reduce the level of pollution produced by urban areas

globalization taxation and burden shifting in latin america most researchers interested in the relationship between global markets and public policy focus on advanced industrial democracies in contrast we examine competing hypotheses as to globalization s effect on governments by expanding the scope of the discussion to include developing nations more specifically we investigate the relationship between international market integration and the evolving burden of taxation on capital as well as the subsequent response of markets to shifts in tax policy in latin america since the late 1970s consistent with our theoretical expectations we find that global market forces are more constraining vis a vis tax policy in latin america than in the world s wealthiest nations despite these market based pressures however national politics continue to influence tax policy in latin america in a manner consistent with findings on advanced industrial democracies as such developing nations continue to have some room to manipulate policy though within the context of a more strictly neoliberal context than their counterparts in advanced industrial democracies

class versus industry cleavages inter industry factor mobility and the politics of trade domestic political conflict has been a constant companion to international trade but the nature of that conflict has varied greatly in western democracies over the last two centuries political battles over trade policy appear to have sometimes divided societies along broad class lines and at other times split them into narrow industry based coalitions i argue that this diversity stems from historical and cross national variation in inter industry factor mobility class coalitions are more likely where factor mobility is high whereas narrow industry based coalitions are more likely where mobility is low evidence from six western economies for the last two centuries indicates that levels of factor mobility have varied historically and cross nationally in accord with industrialization and regulation this variation corresponds broadly with observable differences in the formation of trade policy coalitions

international systems and domestic politics linking complex interactions with empirical models in international relations following older debates in international relations literature concerning the relative importance of domestic versus systemic factors newer debates emphasize interdependence among states and the complex interactions between systemic and domestic factors as globalization and democratization advance theories and empirical models of international politics have become more complicated we present a systematic theoretical categorization of relationships between domestic and systemic variables we use this categorization so that scholars can match their theory to the appropriate empirical model and assess the degree to which systemic factors affect their arguments we also present two advances at the frontier of these empirical models in one we combine hierarchical models of moderating relationships with spatial models of interdependence among units within a system in the other we provide a model for analyzing spatial interdependence that varies over time this enables us to examine how the level of interdependence among units has evolved we illustrate our categorization and new models by revisiting the recent international political economy ipe debate over the relationship between trade policy and regime type in developing countries

energy consumption economic growth and co2 emissions in middle east and north african countries this article extends the recent findings of liu 2005 ang 2007 apergis et al 2009 and payne 2010 by implementing recent bootstrap panel unit root tests and cointegration techniques to investigate the relationship between carbon dioxide emissions energy consumption and real gdp for 12 middle east and north african countries mena over the period 1981 2005 our results show that in the long run energy consumption has a positive significant impact on co2 emissions more interestingly we show that real gdp exhibits a quadratic relationship with co2 emissions for the region as a whole however although the estimated long run coefficients of income and its square satisfy the ekc hypothesis in most studied countries the turning points are very low in some cases and very high in other cases hence providing poor evidence in support of the ekc hypothesis co2 emission reductions per capita have been achieved in the mena region even while the region exhibited economic growth over the period 1981 2005 the econometric relationships derived in this paper suggest that future reductions in co2 emissions per capita might be achieved at the same time as gdp per capita in the mena region continues to grow

housing price functions and ownership capitalization rates abstract in this paper we examine the problem of consistently estimating capitalization rates and hedonic housing prices we specify a hedonic pricing model for housing that combines owner occupied and rental unit samples in a manner yielding hedonic prices not subject to selection bias and capitalization rates which vary with the age and family income of the residents we use the 1982 annual housing survey ahs for metropolitan philadelphia to obtain parameter estimates for this model our findings indicate that selectivity bias is present in price functions utilizing only owner occupied or rental unit samples our results further indicate that the mean annual capitalization rate for owner occupied units is approximately 10 however the capitalization rate is non monotonically related to both age of the head and family income