inspiration coalition and substitution external influences on postcommunist transformations there has been a recent explosion of interest in the external influences on the political and economic transformations of postcommunist states this article consolidates several analytical advances in this literature and distills three main functions of external actors namely to lengthen the time horizons of postcommunist politicians to expand the circle of interested reformers and to deter opponents of reform the article argues that a focus on external influences is a growth area for good conceptual work only if it addresses the union of foreign and domestic influences rather than treating them as stylized alternative explanations the central point is that outside actors should be considered as striving to influence the choices of existing domestic actors with whom they can be seen to form a kind of informal coalition at bottom outsiders do best through a combination of strategies strengthening domestic actors already committed to their approach winning over new domestic actors to their priorities and preventing the unconvinced from obstructing reforms

incentive equivalence with fixed migration costs abstract if migration between communities is costless and if policy makers in each community anticipate the migration response to policy changes then the interests of the two communities are perfectly aligned decentralization is efficient this incentive equivalence is well known however the first order approach used in virtually all the literature may obscure the fact that no convexity assumptions need be made about technology or tastes this fact underscores the relevance of incentive equivalence even when there are scale economies in the public sector here the consequences of positive migration costs for this incentive equivalence are considered in contrast with much of the literature migration costs are assumed the same for everyone this formulation differs from the more common attachment to home assumption of heterogeneous migration costs conditional on the direction of migration interests of different communities are still perfectly aligned but natives of different communities may prefer different directions of migration weakening incentive equivalence if local policy makers have the power to induce large changes in migration flows however incentive equivalence fails only if economies of scale in population are important so that communities may be under populated

transboundary pollution and household mobility are they equivalent abstract recent research has shown that perfect household mobility can serve as a disciplinary mechanism inducing national policy makers to internalize interregional externalities caused by transboundary pollution this paper develops a differential game to illustrate that the result is not necessarily robust when migration costs and explicit dynamics are introduced the paper shows that if governments constantly reoptimize imperfect household mobility leads to a tragedy of the commons and individual countries overemit even when pollution is purely local moreover these dynamic externalities get worse as the degree of household mobility increases and there is a qualitative difference between almost perfect and perfect mobilty that is a discontinuity at zero migration costs

redistribution within and across the regions of a federation the authors reconsider the literature on redistribution within a federation with mobile agents they conclude that redistribution is a function best assigned to the national government local governments with diverse preferences for redistribution distort individual migration decisions the authors also examine the fiscal externality literature which has made an efficiency argument for interregional transfers they show that if local governments have the same preferences for redistribution the nash equilibrium is efficient if preferences are diverse the authors show that nationally imposed interregional transfers do not address the source of the inefficiency nevertheless interregional transfers are shown to be a part of decentralized behavior

optimality free mobility and the regional authority in a federation abstract this paper examines the efficiency properties of a federation characterized by strategically competing regions and freely mobile homogeneous individuals analyses of this economy have concluded that achieving a pareto optimal will require intervention by a national authority this paper makes one basic point the nash equilibrium of regional authority behavior is pareto optimal the implication is that there is no role for a national authority in either providing interregional transfers or correcting for decentralized provision of public goods the nash equilibrium involves samuelson public goods provision and regions purchasing preferred population distributions with optimal interregional transfers

correlated pollutants interregional redistribution and labor attachment in a federation we examine the efficiency of federal policies in a federation characterized by decentralized leadership imperfect labor mobility and transboundary pollution selfish regional governments regulate correlated pollutant emissions by choosing pollution tax and abatement levels in anticipation of the center s redistributive policy the center s objective function obeys a proportional equity principle which implies that its choice of interregional transfer satisfies the equalization of weighted regional welfare levels regional and central governments make their choices subject to migration incentives we show that the subgame perfect equilibrium for the sequential game played by regional and central governments yields socially optimal policies

decentralized and efficient control of transboundary pollution in federal systems abstract decentralized control of transboundary pollution in federal systems can be efficient when population crowding is socially costly in this paper an upstream region abates pollution or makes an interregional income transfer to the downstream region with the sole intent of deterring immigration because either instrument abatement expenditure or interregional income transfer alone implements an efficient population distribution between the regions interregional income transfers are unnecessary for efficiency without explicit income transfers each region provides the efficient portion of the aggregate level of pollution abatement in the nash equilibrium

natural gas vs oil in u s transportation will prices confer an advantage to natural gas abstract the u s energy information administration eia projects that u s natural gas prices will provide a substantial cost advantage over petroleum products as a transportation fuel during the next 30 years although u s natural gas prices closely tracked those of world oil prices from the mid 1990s to early 2009 u s natural gas prices have been much lower relative to those for oil since early 2009 the break owes to technological change that substantially increased the supply of u s shale gas resources although recent weakness in world oil prices has restored at least some temporary comparability between u s natural gas prices and those for petroleum products eia projects u s natural gas prices will rise more slowly as world oil prices recover relatively weaker gains in u s natural gas prices would support the substitution of natural gas for other fuels such as petroleum products in transportation whether such substitution is driven by business or policy decisions will u s natural gas prices be sustainably lower relative to those for petroleum products so as to support the increased use of natural gas in the transportation sector an interpretative review of current market developments and recent research finds the answer is yes

have oil and gas prices got separated abstract this paper applies vector error correction models that show that oil and natural gas prices decoupled around 2009 before 2009 us and uk gas prices had a long term equilibrium with crude prices to which gas prices always reverted after exogenous shocks both us and uk gas prices adjusted to the crude oil price individually and departure from the equilibrium gas price on one continent resulted in a similar departure on the other after an exogenous shock the adjustment between us and uk gas prices took approximately 20 weeks on average and the convergence was mediated mainly by crude oil with a necessary condition that arbitrage across the atlantic was possible after 2009 however the uk gas price has remained integrated with oil price but the us gas price decoupled from crude oil price and the european gas price as the atlantic arbitrage has halted the oversupply from shale gas production has not been mitigated by north american export as there has been no liquefying and export capacity

pure public goods and income redistribution in a federation with decentralized leadership and imperfect labor mobility abstract we examine the non cooperative provision of a pure public good by regional governments in a federation similar to the european union where regional governments are stackelberg leaders and the central government is a stackelberg follower a federation with decentralized leadership the center makes interregional income transfers after it observes the contributions to the pure public good imperfectly mobile workers react to regional and central governments policies by establishing residence in their most preferred region despite the degree of labor mobility we show that the pure public good and interregional transfers are generally allocated efficiently in a federation with decentralized leadership

lng is linking regional natural gas markets evidence from the gravity model abstract evidence exists that global natural gas markets have become more integrated over time one possible explanation for this increased level of integration is that increased liquefied natural gas trade has increased the opportunity for price arbitrage by decreasing transport costs if this explanation is true then the natural gas market should become relatively more integrated because countries separated by large distances would be more willing to trade with each other we employ a gravity model to test whether trade in liquefied natural gas has helped to de regionalize the total natural gas market using trade in the compressed natural gas market as a comparison benchmark the results indicate that liquefied natural gas is indeed a global commodity whereas the compressed natural gas markets are more regional importantly we find that trade in liquefied natural gas has de regionalized the total natural gas market

the great divide literacy nationalism and the communist collapse as communist regimes collapsed in the years 1989 91 communist parties and leaders exited power in roughly half the cases the causes and the impact of this variation have generated considerable controversy the authors show that the combined timing and content of the introduction of mass literacy was responsible for generating the national standards and comparisons that either sustained the legitimacy of communist party rule or led to its rapid and complete demise during the collapse of communist regimes mass literacy explains more of the patterns of the communist exit than do structural modernization or communist legacy accounts and it provides a clear and sustained causal chain

the imitation innovation trade off does borrowing dull the edge of husbandry this article examines the proposition that there is a trade off between imitation and innovation when state elites try to borrow institutional designs from other polities after synthesizing theoretical propositions both for and against a trade off the article develops evidence from case studies of two periods in which such institutional borrowing was widely practiced the post world war ii american occupation of germany and german reunification after 1989 it concludes that imitation sparked innovation in both periods although for two very different reasons the article emphasizes the relation of the research findings to theories of institutional creation and change

interregional spillovers in the presence of perfect and imperfect household mobility abstract when households are immobile across regions the decentralized provision of public goods that generate interregional benefit spillovers is inefficiently low we analyze this problem in an environment of interregional household migration and obtain the following results if households are perfectly mobile across regions then the decentralized provision of public goods generating spillovers is socially efficient there is no need for central government intervention if households are attached to particular regions for cultural or nationalistic reasons however at least one of two regions undersupplies the public good central government intervention can enhance efficiency

explaining political and economic change in post communist eastern europe old legacies new institutions hegemonic norms and international pressures this article presents a framework for the analysis of regime change in post communist eastern europe it examines two competing approaches the legacies of the past and the imperatives of liberalization as alternative causal factors shaping the trajectories of regime change the article argues that the debate between these two approaches has important implications for comparative research methodology and design to the extent that past legacies dominate the path of post communist regime change comparisons with other regions emerging from an authoritarian past will yield less insight the authors claim however that the immediate context of norms institutions and international pressures shapes the particular way that legacies influence outcomes thus they conclude that cross regional research is likely to be fruitful and should be pursued

democracy and the washington consensus abstract this paper argues that there is a substantial body of economic advice roughly summarized in the washington consensus that deserves to be endorsed across the political spectrum such endorsement would still leave a series of major economic issues most notably the tradeoff between efficiency and equity to be determined by the outcome of the political process it is argued that the left interpreted as those who give relatively more weight to equity will advance its cause by embracing the mainstream economics summarized by the consensus

explaining the dominance of legacy unions in new democracies comparative insights from indonesia the continued dominance of legacy unions state backed unions inherited from the previous nondemocratic regime has received little scholarly scrutiny through an analysis of indonesia this article presents a focused theoretical framework for analyzing the staying power of legacy unions and the strategies they pursue to maintain their dominance the author argues that the capacity of legacy unions to survive is a product of inherited advantages membership institutional and legal and the transition context economic conditions union competition and partisan links legacy unions adopt three strategies for survival carrots sticks and reform and pursue a strategy of reform only when they retain meager inherited advantages and face an unfavorable transition context the article also offers suggestions for additional research to further develop the theoretical framework

industrial natural gas consumption in the united states an empirical model for evaluating future trends abstract this study develops a statistical model of industrial us natural gas consumption based upon historical data for the 1958 2003 period the model specifically addresses interfuel substitution possibilities and changes in the industrial economic base using a relatively simple approach the framework can be simulated repeatedly with little effort over a range of different conditions it may also provide a valuable input into larger modeling exercises where an organization wants to determine long run natural gas prices based upon supply and demand conditions projections based upon this demand framework indicate that industrial natural gas consumption may grow more slowly over the next 20 yr than being projected by the u s energy information administration eia this conclusion is based upon the assumption that natural gas prices will follow oil prices as they have done over recent decades if natural gas prices should lag well below oil prices as envisioned by the latest eia outlook industrial natural gas consumption should rapidly expand well beyond the levels being projected by eia

opec and world oil security abstract on the margin the effectiveness of policy to enhance the stability of world oil market oil conditions greatly depends on which countries supply what economists would call the marginal barrels that is the barrels whose production responds to changes in demand if the countries dominating the production of the marginal barrels are relatively unstable policies to reduce world oil consumption or boost oil production from stable suppliers will provide the additional benefit of reducing the contribution of unstable producers to the world oil market if the countries dominating the marginal barrel are relatively stable however policies to reduce world oil consumption or boost oil production from stable suppliers will be less effective in promoting oil market stability typically we think of the highest cost producers as supplying the marginal barrel of oil but our assessment finds it quite likely that opec dominates production of the marginal barrel of world oil moreover opec members have been among the more unstable producers on a historical basis hence reducing world oil consumption and promoting oil production in stable non opec countries will enhance world oil security policies to promote stability in opec countries also would enhance world oil security

green lobbies and transboundary pollution in large open economies abstract we employ a common agency model of policy making to examine how green lobbies affect the determination of trade and environmental policies in two large countries that are linked by trade flows and transboundary pollution we show that the impact of green lobbying on environmental policy outcomes depends crucially on the prevailing trade regime cooperative or non cooperative on whether environmental agencies act in a unilateral or coordinated manner and on the size of the emission leakages and transboundary spillovers under free trade a unilateral increase in pollution taxes reduces domestic emissions at the cost of increased foreign emissions in this case if the emission leakages and the associated transboundary spillovers are large enough green lobbying can create a bias towards lower pollution taxes

transboundary environmental problems with mobile but heterogeneous populations most of the literature on transboundaryenvironmental problems treats population ineach country or region as constant ignoringpopulation mobility we showed previously thatif there is perfect population mobility betweenregions and populations are homogeneous asocially efficient outcome can be supported asa nash equilibrium of the game of uncoordinatedpolicy setting even without any internationalenvironmental agreement in the present paperwe introduce heterogeneous population and showthat when people differ a non cooperativeoutcome is generally inefficient we alsodemonstrate that for a particular set ofobjective functions for the regionalgovernments there is an equilibrium of thegame of uncoordinated policy setting that isefficient finally we give an example wherethe decentralized outcome is efficient whenthere is no population mobility butinefficient when there is population mobility

gas versus oil prices the impact of shale gas abstract what significance will developments in shale gas production have for european gas prices some commentators paint a gloomy picture of the future gas markets but most forecasts for the oil market are positive consequently a view appears to prevail that price trends will differ sharply between oil and gas markets this article looks at developments in us shale gas production and discusses their impact on the movement of european gas prices the relationship between oil and gas prices over time is also analysed

local pollution in federal systems it is widely accepted that decentralized control of local pollution is inefficient if the central and the local authorities are imperfectly informed this paper shows how the central authority can introduce a flexible grant in aid system that induces the local authority to use a weighted combination of local and central information when the local authority suffers from confirmatory bias if the central authority is highly uncertain about the environmental effects of a specific pollutant the tax subsidy scheme can be designed to allow local information to play an essential role in the environmental policy if the central authority is certain that a pollutant must not exceed a specific limit the tax subsidy scheme can be designed to allow local information little influence on the environmental policy

an efficient mechanism to control correlated externalities redistributive transfers and the coexistence of regional and global pollution permit markets abstract we examine joint tradable permit markets as a self enforcing mechanism to control correlated externality problems by correlated we mean multiple pollutants that are jointly produced by a single source but which simultaneously cause differentiated regional and global externalities e g smog and global warming by self enforcing we mean a mechanism that accounts for the endogeneity that exists between competing jurisdictions in the setting of environmental policy within a federation of regions we find that joint domestic and international permit markets are pareto efficient for a wide class of preferences