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91. Tax Effort and Tax Potential of State Governments in Mexico: A Representative Tax System

Author:
Horacio Sobarzo
Publication Date:
10-2004
Content Type:
Working Paper
Institution:
Kellogg Institute for International Studies
Abstract:
Over the last two decades, Mexico has modified its intergovernmental fiscal structure from a very centralized system to a distorted scenario where state governments have gained substantial expenditure functions and most of the taxation responsibilities have remained in the federal government. It is argued that to move towards a more fiscally responsible scenario, some decentralization on the taxation side is needed. In this context, by constructing a representative tax system (RTS), this paper evaluates tax effort and tax potential in Mexico. The results are a useful input for policy decision making, not only in the event of future tax decentralization attempts but also in designing a new transfer scheme. The results are also the first RTS constructed for the Mexican case, and show that regional data in Mexico is gradually improving. Also, while the results shed some light as to which taxes could potentially be decentralized, the article warns about the fact that regional disparities in the country may well be a limitation on the extent to which taxes can be decentralized.
Topic:
Government and Political Economy
Political Geography:
North America and Mexico

92. A Sequential Theory of Decentralization and its Effects on the Intergovernmental Balance of Power: Latin American Cases in Comparative Perspective

Author:
Tulia G. Falleti
Publication Date:
07-2004
Content Type:
Working Paper
Institution:
Kellogg Institute for International Studies
Abstract:
Both advocates and critics of decentralization assume that decentralization invariably increases the power of subnational governments. However, a closer examination of the consequences of decentralization across countries reveals that the magnitude of such change can range from substantial to insignificant. To explain this variation, I propose a sequential theory of decentralization that has three main characteristics: a) it defines decentralization as a process; b) it takes into account the territorial interests of bargaining actors; and c) it incorporates policy feedback effects in the analysis of bargaining situations. I argue that the sequencing of different types of decentralization (fiscal, administrative, and political) is a key determinant of the evolution of intergovernmental balance of power. I measure this evolution in the four largest Latin American countries and apply the theory to the two extreme cases: Colombia and Argentina. I show that, contrary to commonly held opinion, decentralization in Argentina did not increase the power of governors and mayors relative to the president. In contrast, in Colombia, a different sequence of decentralization reforms led to higher degrees of autonomy of the governors and mayors relative to the president.
Topic:
Government and Politics
Political Geography:
Argentina, Colombia, and Latin America

93. Myths of the Enemy: Castro, Cuba and Herbert L. Matthews of The New York Times

Author:
Anthony DePalma
Publication Date:
07-2004
Content Type:
Working Paper
Institution:
Kellogg Institute for International Studies
Abstract:
Fidel Castro was given up for dead, and his would-be revolution written off, in the months after his disastrous invasion of the Cuban coast in late 1956. Then a New York Times editorial writer named Herbert L. Matthews published one of the great scoops of the 20th century, reporting that not only was Castro alive, but that he was backed by a large and powerful army that was waging a successful guerrilla war against dictator Fulgencio Batista. Matthews, clearly taken by the young rebel's charms, and sympathetic to his cause, presented a skewed picture. He called Castro a defender of the Cuban constitution, a lover of democracy, and a friend of the American people: the truth as he saw it.
Topic:
International Relations
Political Geography:
New York, Cuba, Latin America, and Caribbean

94. Does Lootable Wealth Breed Disorder? A Political Economy of Extraction Framework

Author:
Richard Snyder
Publication Date:
07-2004
Content Type:
Working Paper
Institution:
Kellogg Institute for International Studies
Abstract:
This article proposes a political economy of extraction framework that accounts for political order and state collapse as alternative outcomes in the face of lootable wealth. Different types of institutions of extraction can be built around lootable resources—with divergent effects on political stability. If rulers are able to forge institutions of extraction that give them control over the revenues generated by lootable resources, then these resources can contribute to the maintenance of political order by providing the income with which to govern. In contrast, the breakdown or absence of such institutions increases the risk of civil war by making it easier for rebels to get income. The framework is used to explain two puzzling cases that experienced sharply contrasting political trajectories in the face of lootable resources: Sierra Leone and Burma. A focus on institutions of extraction provides a stronger understanding of the wide range of political possibilities—from chaos, through dictatorship, to democracy—in resource-rich countries.
Topic:
Economics, International Trade and Finance, and Political Economy
Political Geography:
Burma and Sierra Leone

95. On the Role of Distance for Outward Foreign Direct Investment

Author:
Peter Egger
Publication Date:
06-2004
Content Type:
Working Paper
Institution:
Kellogg Institute for International Studies
Abstract:
This paper focuses on the estimation of three distance-related effects on outward foreign direct investment (FDI). (i) Distance harms vertical multinationals, since they engage in trade. (ii) It makes non-trading multinationals better off than exporters. (iii) This positive effect on horizontal FDI is expected to rise with bilateral country size due to the home market effect. The use of panel data and related econometric methods is highly recommended to avoid parameter bias from endogenous, unobserved, time-invariant effects. A unified estimation approach to assess all three hypotheses then has to rely on instrumental variable techniques for generalized leastsquares methods. In the empirical analysis of 1989–1999 bilateral US outward FDI stocks at the industry level, it is shown that testing and accounting for autocorrelation is extremely important for parameter inference. In sum, the paper lends strong support to the theory of horizontally organized multinationals as outlined in Markusen and Venables (2000).
Topic:
Economics and International Trade and Finance
Political Geography:
United States

96. The Violence of "Religion": Examining a Prevalent Myth

Author:
William T. Cavanaugh
Publication Date:
03-2004
Content Type:
Working Paper
Institution:
Kellogg Institute for International Studies
Abstract:
This essay examines arguments that religion is prone to violence and finds them incoherent. They are incoherent because they can find no way consistently to differentiate the religious from the secular. After exposing the arbitrariness of the arguments, the essay goes on to examine why such arguments are so common. The hypothesis put forward is that such arguments are so prevalent because, while they delegitimate certain kinds of violence, they legitimate other kinds of violence, namely, violence done in the name of secular, Western states and ideals. Such arguments sanction a putative dichotomy between non-Western, especially Muslim, forms of culture on the one hand, which—having not yet learned to privatize matters of faith—are absolutist, divisive, irrational, and Western culture on the other, which is supposedly modest in its claims to truth, unitive, and rational. In short, their violence is fanatical and uncontrolled; our violence is controlled, reasonable, and often regrettably necessary to contain their violence.
Topic:
Religion

97. Unemployment, Macroeconomic Policy and Labor Market Flexibility: Argentina and Mexico in the 1990s

Author:
Roberto Frenkel and Jaime Ros
Publication Date:
02-2004
Content Type:
Working Paper
Institution:
Kellogg Institute for International Studies
Abstract:
This paper compares the divergent unemployment experiences in Argentina and Mexico in the 1990s, examining in detail the remarkable contrasts in the adjustment of the labor market in these two countries that occur despite equally striking similarities in the evolution of a number of macroeconomic variables and external economic shocks. The paper focuses on the role of macroeconomic policies and the type of industrial restructuring in these developments and considers to what extent the divergent unemployment experiences can be explained by differences in the institutional characteristics of the labor market.
Topic:
Economics and Industrial Policy
Political Geography:
Argentina, South America, North America, and Mexico

98. Political Disaffection and Democratization: History in New Democracies

Author:
Mariano Torcal
Publication Date:
10-2003
Content Type:
Working Paper
Institution:
Kellogg Institute for International Studies
Abstract:
This paper focuses on the analysis of political disaffection. After discussing and defining this notion, the article shows that disaffection affects more widely, though not exclusively, third-wave democracies. The close link between levels of disaffection and the history of democratization in each country explains its higher incidence among new democracies. For this very reason, political disaffection could also run high among more established democracies. However, regardless of its incidence in each particular country, political disaffection reveals a distinctive nature in new democracies because of the absence of a democratic past in many of these cases. Thus, disaffection constitutes a key element to explain the lower propensity of citizens of new democracies to participate in every dimension of political activity.
Topic:
International Relations, Government, International Political Economy, and Politics
Political Geography:
Europe

99. Informal Institutions and Comparative Politics: A Research Agenda

Author:
Gretchen Helmke and Steven Levitsky
Publication Date:
09-2003
Content Type:
Working Paper
Institution:
Kellogg Institute for International Studies
Abstract:
During the 1990s, comparative research on political institutions focused primarily on formal rules. Yet recent studies suggest that an exclusive focus on formal rules is often insufficient, and that informal institutions, ranging from bureaucratic and legislative norms to clientelism and patrimonialism, often have a profound—and systematic—effect on political outcomes. Neglecting these informal institutions thus risks missing many of the “real” incentives and constraints that underlie political behavior. This article seeks to move informal institutions from the margins to the mainstream of comparative politics research. It develops an initial framework for studying informal institutions and, importantly, integrating them into comparative institutional analysis. In the conceptual realm, the article attempts to clarify what is meant by “informal institution” and then develops a typology of four patterns of formal-informal institutional interaction: complementary, accommodating, competing, and substitutive. In the theoretical realm, the article examines two issues that have been largely unexplored in the literature on informal institutions: the question of why and how informal institutions emerge, and the sources of informal institutions stability and change. A final section explores some of the practical challenges inherent in research on informal institutions, including issues of identification, measurement, and comparison.
Topic:
International Relations, Government, International Political Economy, and Politics

100. La Posguerra Colombiana: Divagaciones Sobre la Venganza, La Justicia y la Reconciliación

Author:
Iván Orozco
Publication Date:
05-2003
Content Type:
Working Paper
Institution:
Kellogg Institute for International Studies
Abstract:
This essay explores the relationships between vengeance, justice and reconciliation in contexts of war and transitions towards democracy, with a special emphasis and interest on the Colombian situation. It aims at easing, at least partly, the tensions facing peace makers and human rights activists who deal with the issue of “impunity” for atrocious crimes perpetrated by the state and other political organizations. It does so by distinguishing between vertical and horizontal processes of victimization and by distributing functions between peace makers and human rights activists in accord with this distinction. Based upon the premise that transitional Justice always entails a compromise between punishment, truth and reconciliation, the paper argues for a certain priority of punishment in contexts of vertical victimization and for a partial precedence of reconciliation in contexts of horizontal victimization. The notion of “gray areas” where the distinction between victims and perpetrators, best represented by certain kinds of “collaborators” and, “avengers” collapses, lies at the heart of the logics of forgiveness and reconciliation. After characterizing the Colombian conflict as a case of horizontal victimization—i.e., symmetric barbarism—the paper proposes a model of transitional justice for Colombia built on the primacy of truth and forgiveness for the inhabitants of gray zones and punishment for the engineers and managers of barbarism.
Topic:
Democratization and Government
Political Geography:
Colombia and South America