the spread of municipal reform temporal spatial and social dynamics the adoption of commission and managerial administrative structures and their subsequent abandonment by the 267 largest american cities during the period 1900 1942 is studied using event history methods full period equations show no significant direct effect of percentage catholic culture clash or population size hierarchical diffussion and only a modest impact of city age modernization a strong effect from average annual manufacturing wages is found but in a direction contrary to that posited by the class conflict hypothesis the variable affecting transition rates most strongly appears to be regional adoption percentages an indicator of neighborhood diffusion these findings suggest revisions of the conventional image of the municipal reform experience

buy local pollute less what drives households to join a community supported farm this paper examines which factors determine the participation of households in long term contracting with local farmers are households motivated by reducing the environmental impacts of their food consumption a discrete choice model of community supported agriculture csa participation is applied to a sample of 264 french households the findings suggest that difficult to measure attributes notably environmental considerations play a major role in explaining csa participation

the economics of the covid 19 pandemic an assessment the covid 19 pandemic has created both a medical crisis and an economic crisis as others have noted we face challenges just as big as those in the spanish flu pandemic and the great depression all at once the tasks facing policy makers are extraordinary many new kinds of intervention are urgently required this issue of the oxford review of economic policy has two objectives the first is to explore these new interventions evaluating their use suggesting how they might be improved and proposing alternatives the second is to show that the challenges facing us are global and will require international cooperation if they are to be dealt with effectively this short introductory essay positions the papers in the issue within an overall conceptual framework with the aim of telling an overarching story about the pandemic

bureaucracy infrastructure and economic growth evidence from u s cities during the progressive era recent work in the sociology of economic development has emphasized the establishment of a professional bureaucracy in place of political appointees as an important component of the institutional environment in which private enterprise can flourish i hypothesize that establishment of such a bureaucracy will lengthen the period that public decision makers are willing to wait to realize the benefits of expenditures leading to allocation of a greater proportion of government resources to long gestation period projects such as infrastructure this hypothesis can be tested using data generated by a natural experiment in the early part of this century when a wave of municipal reform transformed the governments of many u s cities controlling for city and time effects adoption of civil service is found to increase the share of total municipal expenditure allocated to road and sewer investment other estimates imply that this increased share raises the growth rate of city manufacturing employment by one half percent per year this abstract was borrowed from another version of this item

mass privatization state capacity and economic growth in post communist countries why did the transition from socialism to capitalism result in improved growth in some countries and significant economic decline in others scholars have advanced three main arguments 1 successful countries rapidly implemented neoliberal policies 2 failures were not due to poli cies but to poor institutional environments and 3 policies were counterproductive because they damaged the state we present a state centered theory and empirically demonstrate for the first time one of several possible mechanisms linking neoliberal policies to poor economic performance mass privatization programs where implemented created a massive fiscal shock for post communist governments thereby undermining the development of private sector gover nance institutions and severely exacerbating the transformational recession we performed cross national panel regressions for a sample of 25 post communist countries between 1990 and 2000 and found that mass privatization programs negatively affected economic growth state capacity and property rights protection we further tested these findings with firm level data from a rep resentative survey of managers in 3 550 companies operating in 24 post communist countries within countries that implemented mass privatized programs newly privatized firms were sub stantially less likely to engage in industrial restructuring but considerably more likely to use bar ter and accumulate tax arrears than their state owned counterparts

global economic integration in developing countries the role of corruption and human capital investment globalization is multifaceted and involves the interaction among businesses services governments and societies beyond national borders as a result the flow of foreign direct investment fdi international trade in goods and services and the economic interdependence of the nations of the world have been increasing at the same time much attention has been paid to the effect of corruption prevalent within many cultures and societies and its impact on the economies especially developing economies this paper examines the relationship between human capital investment the level of national corruption and the global economic integration gei of a nation in developing countries based on the data collected from over 60 countries and building on the fdi and human capital theories it was found that human capital investment and corruption are related to gei it was also found that the level of corruption moderates the relationship between human capital investment and gei of developing economies the findings of the study can help to deepen our understanding of gei and have practical implications for developing countries in terms developing human capital which plays a critical role in today s knowledge based economy

macroeconomic policy in a two party system as a repeated game this paper considers the interaction of two parties with different objectives concerning inflation and unemployment and rational and forward looking wage setters if discretionary policies are followed an economic cycle related to the political cycle results in equilibrium this cycle is significantly different from the traditional political business cycle reputational mechanisms due to the repeated interaction of the two parties and the public or commitments to a common policy rule can improve upon the discretionary outcome by reducing or eliminating the magnitude of the economic fluctuations

information technology and transnational integration theory and evidence on the evolution of the modern multinational enterprise reflecting amplified hazards in cross border exchange and imperfections in markets for intangibles internalization has been central in multinational enterprise mne theory this centrality notwithstanding the fact is that internalization coheres with lower powered incentives and carries an implicit drawback namely higher realized production costs with the emergence and deployment of information and communication technology ict modern mnes are reshaping their transnational governance to address this cost the modern mne uses ict to mitigate transaction costs and evolves more to arm s length exchange to incentivize lower production costs a testable prediction is that mnes in industries more susceptible to and employing more ict will exhibit a reduced propensity for transnational integration we examine this hypothesis using available data from 1982 to 1997 for us mnes across all manufacturing sectors regression results and robustness tests are strongly congruent with the prediction this study a first to explore empirically the role of ict in the evolution of transnational exchange suggests that mne theory until now founded primarily on transaction cost economics and a cross border control theory of value capture is more likely to keep pace with developments in mne practice by opening up to incentive theories of exchange governance and a cross border coordination theory of value creation

bureaucracy and growth a cross national analysis of the effects of weberian state structures on economic growth the role of bureaucratic authority structures in facilitating economic growth has been a sociological concern since max weber s classic contributions almost 100 years ago using a recent and original data set we examine the characteristics of core state economic agencies and the growth records of a sample of 35 developing countries for the 1970 1990 period our weberianness scale offers a simple measure of the degree to which these agencies employ meritocratic recruitment and offer predictable rewarding long term careers we find that these weberian characteristics significantly enhance prospects for economic growth even when we control for initial levels of gdp per capita and human capital our results imply that weberianness should be included as a factor in general models of economic growth they also suggest the need for more attention by policymakers to building better bureaucracies and more research by social scientists on variations in how state bureaucracies are organized

separation of powers and political accountability political constitutions are incomplete contracts and therefore leave room for abuse of power in democracies elections are the primary mechanism for disciplining public officials but they are not sufficient separation of powers between executive and legislative bodies also helps to prevent the abuse of power but only with appropriate checks and balances checks and balances work by creating a conflict of interest between the executive and the legislature yet requiring both bodies to agree on public policy in this way the two bodies discipline each other to the voters advantage under appropriate checks and balances separation of powers also helps the voters elicit information

agglomeration adjustment and state policies in the location of foreign direct investment in the united states abstract using u s state level data we show that agglomeration externalities influence the level of foreign invested capital in a location our empirical model allows the separation of agglomeration effects from the rate of capital stock adjustment two forces that previous research has conflated we estimate an agglomeration elasticity of investment of 0 11 to 0 15 with respect to same source country investment lower than previous estimates we also investigate the influence of state policies and find that although general investment incentives do not affect the location of fdi targeted policies such as unitary taxation and state foreign offices influence investment

social trust in subnational regions and foreign subsidiary performance evidence from foreign investments in china recent research suggests that subnational regions can explain the variation in foreign subsidiary performance however most studies either treat subnational regions as a whole or focus on formal institutions at the subnational level this study examines how general social trust an important dimension of informal institutions at the subnational level affects foreign subsidiary performance in a sample of 17 886 foreign investments in china in 2012 we find that the level of social trust in subnational regions has a positive effect on the performance of foreign subsidiaries reducing the liability of outsidership faced by foreign subsidiaries our results also show that this positive effect is contingent on local embeddedness of the foreign subsidiaries our findings highlight the importance of incorporating informal institutions at the subnational level in examining strategies and strategy outcomes

show me the money interjurisdiction political competition and fiscal extraction in china we argue that interjurisdiction competition in authoritarian regimes engenders a specific logic for taxation promotion seeking local officials are incentivized to signal loyalty and competence to their principals through tangible fiscal revenues the greater the number of officials accountable to the same principal the more intense political competition is resulting in higher taxation however too many officials accountable to the same principal leads to lower taxation due to shirking by uncompetitive officials and the fear of political instability using a panel dataset of all chinese county level jurisdictions from 1999 2006 we find strong evidence for an inverse u shaped relationship between the number of county level jurisdictions within a prefecture our proxy for the intensity of political competition and fiscal revenues in most provinces but not so in politically unstable ethnic minority regions the results are robust to various alternative specifications including models that account for heterogeneous county characteristics and spatial interdependence

what s to know puzzles in the literature on the value of statistical life notwithstanding the general acceptance of the value of statistical life vsl estimates for policy assessment purposes several important unresolved issues remain first the results from revealed preference studies are systematically higher than those from stated preference studies potentially limiting the usefulness of stated preference studies in generalizing the vsl estimates to different populations and kinds of risks second extrapolating the results of meta analyses to project the vsl for different population groups requires that such generalization be reflective of the underlying economic content of what average vsl estimates reflect third government agencies within and across countries place differing emphasis on types of vsl studies as well as differing reliance on individual studies versus meta analyses usually there is no justification provided for the chosen approach

do land revenue windfalls create a political resource curse evidence from china abstract by analyzing a panel on the political turnovers of 4390 county leaders in china during 1999 2008 we find that the revenue windfalls accrued to these officials from land sales have undermined the effectiveness of the promotion system for government officials instead of rewarding efforts made to boost gdp growth promotion is positively correlated with signaling efforts and with corruption the robust positive relationship between land revenue windfalls and political turnover or specifically promotion suggests that those who are politically connected to their superiors and those beyond the prime age for promotion are the primary beneficiaries the case for corruption is substantiated by the evidence inferred from anti corruption crackdowns which reveals that the additional effect of land revenue on political turnover and size of bureaucracy a proxy for corruption decreases significantly in crackdowns but that land revenue has no effect on city construction expenditure a proxy for signaling

crisis and competition in expert organizational decision making credit rating agencies and their response to turbulence in emerging economies firms often delegate elements of strategic decisions to outside experts who promise objective assessments which are especially valuable in unstable environments however experts themselves may be prone to skewed decision making as the stability of their own industry environment changes and as their positioning within the industry shifts we examine this possibility in the context of expert credit rating agencies agencies and their risk ratings of emerging market sovereign borrowers ratings published from 1987 to 1998 a period that includes both industry stability 1987 1996 and industry turbulence set off by financial crises in several emerging market countries 1997 1998 after controlling for macroeconomic and related objective risk factors linked to the sovereigns themselves we find several points 1 agency ratings during crisis induced industry turbulence are negatively skewed indicating undue pessimism among these experts in line with decision making perspectives predicting negative reaction by experts in an effort to retain legitimacy with salient stakeholders in this case investors and public regulators 2 this negative shift is greater for incumbent firms and regionally focused firms possibly because of the loss of previous informational advantages and 3 this negative shift during crisis induced turbulence is greater as industry rivalry among these experts increases in particular market segments possibly indicating the development of competitive bandwagons among experts together our results suggest that objective assessments by expert organizations are vulnerable to substantial distortion from the confluent effects of industry instability and expert positioning within the industry particularly positioning affecting rivalry among experts ironically experts may be most likely to mislead clients in unstable industry environments when experts command greater attention and should show greater fidelity to disinterested objectivity

community currencies and sustainable development a systematic review community or complementary currency systems have spread all around the world most often they have been promoted as tools to foster sustainable development albeit they differ in terms of specific objectives while many case studies have tried to assess the actual impact of these systems there has been no global analysis summarizing their global impact this paper aims to fill the gap by exploring whether complementary currencies contribute to the three pillars of sustainable development we use the systematic review methodology on an original dataset gathering most academic publications on the topic in english french and spanish our main findings suggest that community currencies mostly contribute to social sustainability and that their economic benefits are somewhat limited due to their small scale and the lack of awareness on their scope moreover very few studies explicitly identify environmental outcomes finally this review reveals some limits regarding current methods for impact assessment in this field therefore it encourages more standardization to provide greater accuracy and strengthen the legitimacy of community currencies in order to foster their continued development

credible enticements can host governments tailor multinational firms organizations to suit national objectives abstract this article discusses the impact of host government policy inconsistency on multinational corporations relationships with local suppliers that benefit from public funding empirical findings suggest that such relationships suffer from transactions cost disadvantages due to concerns that unexpected losses of funding may cause the suppliers to demand new contracts the findings reflect statistical tests on a structural equation latent variable model using data from a survey of 111 affiliates of mncs operating in 36 countries

do economic effects justify the use of fiscal incentives the community of location this presumption serves as the basis for the granting of lucrative economic development incentives to footloose businesses this article examines whether large mobile firms generate significant net benefits for the region of location panel data and nonrandom estimation techniques are applied to a primary database of large firms that made location decisions in the 1980s to explore the impact of location on regional economic performance the empirical analysis explores different treatment regions both effects within the county and the metropolitan statistical area msa of location and different control regions the results show that large firms fail to produce significant net benefits for their host communities calling into question the high stakes bidding war over jobs and investment

does electoral accountability affect economic policy choices evidence from gubernatorial term limits this paper analyzes the behavior of u s governors from 1950 to 1986 to investigate a reputation building model of political behavior we argue that differences in the behavior of governors who face a binding term limit and those who are able to run again provides a source of variation in discount rates that can be used to test a political agency model we find evidence that taxes spending and other policy instruments respond to a binding term limit if a democrat is in office the result is a fiscal cycle in term limit states which lowers state income when the term limit binds

the impact of corruption on entry strategy evidence from telecommunication projects in emerging economies with globalization and the growth in emerging economies multinational enterprises mnes now frequently confront challenges associated with corrupt governments already a growing body of research has demonstrated that corruption significantly reduces a countrys aggregate inflows of foreign direct investment through its effects on firm performance we move the analysis of corruption from aggregate financial flows toward managerial theory and practice by examining how firms adjust their strategy for entering foreign markets in corrupt environments and how different types of corruption affect firms choices building on institutional theory we predict that mnes will respond to pervasive and arbitrary corruption in a host country by selecting particular types of equity and nonequity modes of entry using data on 220 telecommunications development projects in 64 emerging economies we find that firms adapt to the pressures of corruption via short term contracting and entry into joint ventures we also find that the arbitrariness surrounding corrupt transactions has a significant impact on firms decisions in addition to the overall level of corruption in contrast to extant research we show that mnes use nonequity entry modes or partnering as an adaptive strategy to participate in markets despite the presence of corruption

bureaucratic discretion or congressional control regulatory policymaking by the federal trade commission this paper extends stigler and peltzman s approach to regulation by incorporating a legislature the model yields comparative statics results and hence testable implications the paper then tests between two opposing approaches about regulatory agency behavior the first assumes agencies operate independently of the legislature and hence exercise discretion the second assumes that congress controls agency decisions the recent behavior of the federal trade commission provides the empirical setting substantial evidence is found for the specific predictions of the model including the hypothesis of systematic congressional influence over ftc decisions

optimal incentive contracts in the presence of career concerns theory and evidence this paper studies optimal incentive contracts when workers have career concerns concerns about the effects of current performance on future compensation we show that the optimal compensation contract optimizes total incentives the combination of the implicit incentives from career concerns and the explicit incentives from the compensation contract thus the explicit incentives from the optimal compensation contract should be strongest for workers close to retirement because career concerns are weakest for these workers we find empirical support for this prediction in the relation between chief executive compensation and stock market performance

equilibrium political budget cycles political business cycle theories generally rely on nominal rigidities and voter myopia this paper offers an equilibrium theory that preserves some basic insights from earlier models though with significant refinements the political budget cycle emphasized here is in fiscal policy rather than output and inflation it arises via a multidimensional signal process one can consider the welfare implications of proposals to mitigate the cycle and the effects of altering the electoral structure copyright 1990 by american economic association

pro market institutions and global strategy the pendulum of pro market reforms and reversals we review the literature analyzing the impact of pro market institutions on firms global strategy we propose that the ideological tension between whether the government or the market should drive economic development results in a pendulum of pro market reforms and reversals that drive changes in firm strategy and performance much progress has been made in the analyses of pro market reforms and their impact on firms international strategies and performance however there is a need to further learn about four areas 1 the concept of pro market institutions in particular the variety of institutional dimensions the measures and the influence of informal institutions on firm strategies 2 the drivers of changes in pro market institutions especially firms influences and the co evolution of firm strategies and institutional changes 3 the implications of changes in pro market reforms for the interactions among integration diversification and internationalization strategies the causality chains connecting institutions and strategies and the reconfiguration of activities globally and 4 the non traditional moderators that alter the impact of pro market institutional dynamics on firms strategies such as country level political systems industry level competitor reactions and individual level managerial capabilities and perceptions

evaluating the impact of investment incentives the case of italy s law 488 1992 abstract italy s law 488 1992 allows firms willing to invest in lagging areas to receive a public subsidy by comparing subsidized firms with firms with rejected applications this paper evaluates whether the program made investments possible that otherwise would not have been made we find evidence that financed firms brought forward investment projects originally planned for the post intervention period to take advantage of the incentives we also find some support that subsidized firms may have taken some of the investment opportunities that unsubsidized firms would have exploited in the absence of incentives

political party tenure and mne location choices we develop a theoretical framework to explain how political party tenure affects mne entries into an economy we leverage insights from the upper echelon and public administration literatures to argue that there is a curvilinear relationship between political party tenure and mne entries moreover we argue that political parties with an excessive tenure are less responsive to mnes and more corrupt therefore we further explain the mediating effects of government bureaucratic responsiveness and government corruption on that relationship we test our theory using a sample of manufacturing mnes entering into mexican cities the results support our theory

state ownership effect on firms fdi ownership decisions under institutional pressure a study of chinese outward investing firms this study investigates the effect of state ownership on chinese firms foreign direct investment fdi ownership decisions it adopts a political perspective to extend the application of institutional theory in international business research specifically it examines firms heterogeneous responses to external institutional processes during foreign market entry while taking into consideration the political affiliation of firms with the external institutions we argue that state ownership creates the political affiliation of a firm with its home country government which increases the firm s resource dependence on home country institutions while at the same time influencing its image as perceived by host country institutional constituents such resource dependence and political perception increase firms tendency to conform to rather than resist isomorphic institutional pressures we tested our hypotheses using primary data for 132 fdi entries made by chinese firms during 2000 2006 and we found that the effects of home regulatory host regulatory and host normative pressures on a firm to choose a joint ownership structure were stronger when the share of equity held by state entities in the firm was high

policy uncertainty and the sequence of entry by japanese firms 1980 1998 we extend the stages model of internationalization to incorporate a sophisticated consideration of temporal and cross national variation in the uncertainty of the policy environment using a sample of 6465 international expansions of 665 japanese manufacturing firms in 49 countries we develop arguments from internationalization and bargaining power perspectives to show how japanese firms manage policy uncertainty in host country environments through the within country sequencing of investments although a distribution to manufacturing entry sequence tends to prevail in countries with low levels of policy uncertainty as uncertainty in the policy environment increases initial entry by distribution is increasingly likely to be eschewed in favor of an initial entry by a joint venture manufacturing plant we suggest that this change in investment sequence occurs as firms shift from an emphasis on developing knowledge about local markets and consumers in low hazards markets to an international expansion strategy in uncertain policy environments that places knowledge development of the policy environment at the forefront of a firm s strategy

testing the bargaining hypothesis in the manufacturing sector in developing countries the bargaining power model of hc mnc host country multinational corporation interaction conceives of economic nationalism in terms of rational self interest and assumes both inherent conflict and convergent objectives in extractive industries there is strong evidence that outcomes are a function of relative bargaining power and that as power shifts to developing hcs over time the bargain obsolesces a cross national study of the bargaining model using data from 563 subsidiaries of u s manufacturing firms in forty nine developing countries indicates that while the bargaining framework is an accurate model of mnc host country relationships manufacturing is not characterized by the inherent structurally based and secular obsolescence that is found in the natural resource industries shifts in bargaining power to hcs may take place when technology is mature and global integration limited in industries characterized by changing technologies and the spread of global integration the bargain will obsolesce very slowly and the relative power of mncs may even increase over time

effects of term limits on fiscal performance evidence from democratic nations political reputation models feature forward looking rational voters who re elect incumbents based on their estimate of an incumbent s ability level fiscal policy is one of the ways an incumbent establishes a reputation and thereby signals this ability level to voters the reputation building framework implies that term limits should affect fiscal performance a term limited incumbent places less value on reputation building than an incumbent eligible for re election does we examine differences in fiscal performance in democratic countries under alternative executive term limit regimes our results generally agree with the prior findings of besley and case 1995a who analyzed gubernatorial term limits in the american states we provide new evidence that the fiscal effects of term limits differ under a two term rule versus a single term rule

timing is everything elections and trade liberalization in the postcommunist world in the wake of the soviet bloc s collapse various postcommunist countries rushed to gain greater access to foreign markets many of them have made substantial progress in liberalizing commerce but the movement toward free trade has been by no means universal one prominent view is that the establishment of democratic institutions has stimulated economic reform in thepostcommunist world the authors conduct one of the first studies on this topic and find that democracies are indeed more likely to liberalize trade than nondemocracies they also find that the electoral calendar has a potent influence on the timing of commercial reform in postcommunist democracies controlling for a range of factors politicians are most likely to reduce trade barriers immediately after voters go to the polls trade liberalization is much less likely to occur at other points in a democracy s electoral calendar and elections have no effect on commercial reform in nondemocracies

political business cycles democratization and economic reform the case of africa abstract this paper presents cross country evidence that political business cycles are alive and well in the nascent democracies of the developing world africa provides fertile ground for the study of political business cycles this paper uncovers systematic electorally timed interventions in five monetary and four fiscal policy variables in a panel of african countries these findings are consistent with the predictions of rational opportunistic political business cycle theory if africa s increasingly frequent elections are associated with reversals of fiscal and monetary policy reform there is a potential conflict between political and economic reform

measuring the value of a statistical life problems and prospects tradeoffs between monetary wealth and fatal safety risks are summarized in the value of a statistical life vsl a measure that is widely used for the evaluation of public policies in medicine the environment and transportation safety this paper demonstrates the widespread use of this concept and summarizes the major issues both theoretical and empirical that must be confronted in order to provide a credible estimate of a vsl the paper concludes with an application of these issues to a particular study of speed limits and highway safety

growing green money mapping community currencies for sustainable development abstract parallel sustainable monetary systems are being developed by civil society groups and non governmental organisations ngos informed by ecological economics perspectives on development value economic scale and growth and responding to the unsustainability of current global financial systems these parallel systems of exchange or community currencies are designed to promote sustainable development by localising economic development building social capital and substituting for material consumption valuing work which is marginalised in conventional labour markets and challenging the growth based monetary system however this international movement towards community based ecological economic practices is under researched this paper presents new empirical evidence from the first international study of the scope and character of community currencies it identifies the diversity scale geography and development trajectory of these initiatives discusses the implications of these findings for efforts to achieve sustainable development and identifies future research needs to help harness the sustainability potential of these initiatives

what is the meaning of statistical life benefit cost analysis in the time of covid 19 efforts to support public policy decisions need to be conducted carefully and thoughtfully recent efforts to estimate the social benefits of reductions in mortality risks associated with covid 19 interventions are likely understated there are large uncertainties over how much larger the social benefits could be this raises questions about how helpful conventional approaches to valuing mortality and morbidity risks for benefit cost analyses can be in contexts such as the current crisis

political aspects of mne theory political behavior by mnes has usually been ignored downplayed or passively treated in dominant economic models of the multinational enterprise in order to remedy this lacuna dunning s eclectic paradigm is expanded to integrate political dimensions in the analysis of ownership internalization and location advantages

microeconomic degrowth the case of community supported agriculture in this paper we attempt to build a new microeconomic approach that could be considered as a basis of the degrowth macroeconomic view as degrowth is a critique of the dominant macroeconomic model of the endless search for economic growth its microeconomic foundations can be built by searching a relevant grass root economic initiative to theorise our approach is based upon the case study research of a self harvesting community supported agriculture in belgium the mainstream microeconomic model is based on the well known homo economicus assumption of individual self interest and competitive behaviour by contrast our model is based on a holistic approach of producers and consumers based upon trust cooperation and ecologically responsible behaviours this contribution participates to the flourishing literature on degrowth in ecological economics we begin by reviewing the debate on degrowth and economic behaviour we discuss the case study and its accounting expression that departs from the capitalist profit seeking model we conclude by explaining the limits and challenges of our model that implements degrowth on a small scale and in a capitalist environment

economic policy economic performance and elections this paper explores the role of reelection pressures in determining economic policy by assuming that voters are uncertai n as to the efficacy of different policies a reelection process is derived that depends on both a politician s past policies and the level of economic activity during his time in office it is shown th at the less uncertain are voters as to which policy is best the more likely is a politician to manipulate policy for reelection purposes manipulation entails implementing the policy that is more likely to be well received rather than the one that maximizes income copyright 1993 by american economic association

how much does subnational region matter to foreign subsidiary performance evidence from fortune global 500 corporations investment in china what explains the heterogeneity of foreign subsidiary performance previous studies have emphasized the importance of industry corporate parent and home country effects on the variation of foreign subsidiary performance building on recent international business and economic geography research this study examines the extent to which subnational region effects can also explain such performance variation we empirically decompose the variance of the performance of fortune global 500 corporations subsidiaries in china during 1998 2006 results show that not only are subnational region effects statistically significant in explaining the variation of subsidiary performance but their interactions with industry corporate parent and home country effects are also significant and economically important we further show that subnational region effects tend to be stronger in the period prior to china s wto accession and in the country s less developed subnational regions our findings highlight the importance of considering both the direct and indirect roles of subnational region in shaping firms strategy and performance in international business research

spanning the institutional abyss the intergovernmental network and the governance of foreign direct investment global economic transactions such as foreign direct investment fdi must extend over an institutional abyss between the jurisdiction and therefore protection of the states involved intergovernmental organizations igos represent an important attempt to span this abyss the authors use a network approach to demonstrate that the connections between two countries through joint membership in the same igos are associated with a large positive influence on the fdi that flows between them moreover they show that this effect occurs not only in the case of connections through economic igos but also through those with social and cultural mandates this demonstrates that relational governance is important and feasible in the global context even for the most risky transactions the authors also examine the interdependence between the igo network and the domestic institutions of states social and cultural igo connections do more and economic igo connections less to increase fdi when the target country is mo

social enterprises and non market capitals a path to degrowth the aim of this paper is to look at alternatives to the classic for profit shareholding enterprise and to suggest how such alternatives might be supported within the current economic system another aim is to link the social enterprise and degrowth discourses we first re define the economy as including non monetised sectors the core economy and the economy of nature and discuss the liminal zone of not for profit and not only for profit organisations we then look at social enterprise definitions from a degrowth perspective and explain why the dimensions of scale place environment and provisioning patterns need more space in the social enterprise discourse after that we define non market capitals as capitals taken out of the market and placed under local member democratic control and explain their importance in a degrowth economy we give examples of non market capitals and suggest a model involving mutual support between primary and secondary social enterprises finally we suggest areas where more research is needed in this emerging field of inquiry

how do mncs vote in developing country elections research on multinational corporations mncs and host government political risk in developing countries has largely ignored local electoral politics economic policies and the mnc investment ince

the governance features of social enterprise and social network activities of collective food buying groups abstract collective food buying groups such as community supported agriculture or self organised citizen groups for delivery of food baskets have emerged throughout the world as an important niche innovation for promoting more sustainable agri food systems these initiatives seek to bring about societal change they do so however not through protest or interest based lobbying but by organising a protected space for learning and experimentation with lifestyle changes for sustainable food consumption and production practices in particular they aim to promote social learning on a broad set of sustainability values beyond a focus on fresh and healthy food only which characterizes many of the individual consumer oriented local food chain initiatives this paper analyses the governance features of such local food buying groups by comparing 104 groups in five cities in belgium we find that the social networking activities of these groups as compared to the social enterprise activities have led to establish specific governance mechanisms whereas the main focus of the social enterprise activities is the organisation of the food provisioning logistics the focus of the social network activities is the sharing of resources with other sustainable food initiatives dissemination of information and broader discussion on sustainability issues

polluting thy neighbor unintended consequences of china s pollution reduction mandates this paper studies how the pollution reduction mandates imposed by china s central government in 2001 triggered unanticipated responses from its provinces we apply the difference in differences in differences ddd method to a unique dataset on industry level activities in counties along 24 major rivers in china from 1998 through 2008 we find that the most downstream county of a province has up to 20 percent more water polluting activities than otherwise identical counties since 2001 moreover we find that the enforcement of pollution fee collection is more lenient in the most downstream county of a province and that private firms contribute more to the downstream effect than state owned enterprises and foreign firms these findings are consistent with the hypothesis that the provincial governments respond to the pollution reduction mandates by shifting their enforcement efforts away from the most downstream county

running out of steam a political incentive perspective of fdi inflows in china drawing on the sociological literature of state bureaucracy we develop a political incentive perspective on fdi inflows we argue that political term as a core feature of career advancement in state bureaucracy influences the incentives of newly appointed government officials and in turn their efforts toward achieving the state s goal of attracting fdi due to the mandatory retirement age which limits the career advancement officials in their first terms perceive that they have better chances of promotion and hence have stronger incentives to work toward advancement than those continuing to serve in the current position for the following term we test this argument by examining chinese city government leaders and fdi inflows in their cities from 2003 to 2010 using a difference in differences design the results show that first term leaders who are newly appointed after political turnover attract more fdi inflows than continuing leaders the difference is smaller when the new leaders are close to retirement but greater if they are appointed to cities with low prior gdp performance this study offers a new perspective on intra country fdi variations and extends the literature on the role of political institutions by investigating the political incentives of government officials

the state led transition to liberal capitalism neoliberal organizational world systems and social structural explanations of poland s economic success neoliberals argue that rapid liberalization and privatization can transform postcommunist economies into western style capitalist systems organizational sociologists argue that these policies produce a unique variety of capitalism while world systems theorists argue that they lead to underdevelopment this article advances a social structural alternative in a crucial case poland s relative economic success resulted from prolonged state ownership and an interventionist state employing various industrial policy tools that facilitated efficiency enhancing market oriented restructuring before ushering in beneficial foreign direct investment the resulting capitalist system closely resembles the typical pattern found in most late industrializers

the global economy as instituted process the case of central and eastern europe i argue that economic globalization indicated by the tremendous rise in world foreign direct investment fdi in recent decades is not driven simply by investor considerations of economic risk and return but is significantly shaped by the construction of demand for foreign capital by receiving states states signal this demand through the levels of formal and substantive legitimacy they grant to fdi they institutionalize globalization in formal rule as a normatively desirable development strategy states substantiate this commitment by providing domestic and foreign actors with ideational and organizational resources to facilitate fdi to illustrate this argument i use the case of central and eastern europe which was largely closed to global capital before the collapse of communism analyses of quantitative and qualitative data show that substantive legitimacy granted to fdi by host states more than formal regulations determined the size of foreign capital flows into postsocialist countries in the

competing for global capital or local voters the politics of business location incentives the competition for global capital has led to interjurisdictional competition between countries states and cities as to who can offer the most attractive incentives to firms in this study we examine the domestic politics of this competition by focusing on incentive use in the united states from 1999 to 2012 we define incentives as the targeted tax deductions or exemptions that are used to lure businesses into a locality drawing on data from municipal incentive programs we examine how electoral competition shapes the use and oversight of targeted incentives we find evidence that cities with elected mayors provide larger incentives than non elected city managers by taking advantage of exogeneity in the assignment of city government institutions and a database of over 2000 investment incentives from 2010 to 2012 we also find that elected mayors enjoy more lax oversight of incentive projects than their appointed counterparts our results have important implications for the study of interjurisdictional competition and the role of electoral institutions in shaping economic policy

governance infrastructure and us foreign direct investment this paper examines the statistical importance of governance infrastructure as a determinant of us foreign direct investment fdi in broad terms governance infrastructure represents attributes of legislation regulation and legal systems that condition freedom of transacting security of property rights and transparency of government and legal processes our econometric analysis uses a two stage estimation procedure in the first stage the probability that a country is an fdi recipient is estimated the results indicate that countries that fail to achieve a minimum threshold of effective governance are unlikely to receive any us fdi countries that receive no us fdi are typically countries that do not promote free and transparent markets that have ineffective governments and that often have legal systems that are not rooted in english common law in the second stage the analysis is restricted to those countries that did receive fdi flows the estimated equations focus on the determinants of the amount of fdi received given that a country is a recipient of us fdi governance infrastructure including the nature of the legal system is an important determinant of the amount received

politicians and banks political influences on government owned banks in emerging markets abstract government ownership of banks is very common in countries other than the united states this paper provides cross country bank level empirical evidence about political influences on these banks it shows that government owned banks increase their lending in election years relative to private banks this effect is robust to controlling for country specific macroeconomic and institutional factors as well as bank specific factors the increase in lending is about 11 of a government owned bank s total loan portfolio or about 0 5 of the median country s gdp per election per government owned bank

the demise of expropriation as an instrument of ldc policy 1980 1992 this paper reports data collected on expropriation activity by developing countries from 1980 1992 extending previous work by kobrin 1984 kobrin s assumption that expropriation activity would continue to decrease over time and his reasons for this assumption are supported the paper introduces recent phenomena which further indicate that expropriation is unlikely to resurface in the near future as a source of multinational corporation developing country contention many developing countries now protect foreign direct investors from expropriation the broad scale movement in developing countries to privatize state owned enterprises also indicates that governments will not be eager to replace private sector activity with state ownership

immigrant remittances and the venture investment environment of developing countries despite the increasing importance of financial and social remittances to developing countries their impact on home country venture investing environments has been largely overlooked i develop a framework grounded in transaction costs economics and social knowledge theories to investigate relationships between remittances and home country 1 capital availability 2 new business creation and 3 economic internationalization my framework also accounts for individual and collective immigrant attributes that may moderate the impact of remittances on these alternative indicators of the venture investment environment analyses of immigrant remittances to 61 developing countries from 2002 2007 indicate that they increase general and more narrowly defined venture capital availability as well as broader openness to international trade remittances also increase new business start up rates when the developing country s public sector is sufficiently small positive venture funding effects of remittances are magnified when coming from immigrants living in highly concentrated communities but are diminished when coming from highly educated immigrants overall results suggest that developing country immigrants of varying backgrounds play an important role in venture funding founding and integration with the world economy