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2741. The Janus Faces of Money, Property, and Governance: Fiscal Finance, Empire, and Race

Author:
Jamee K. Moudud
Publication Date:
09-2020
Content Type:
Working Paper
Institution:
Political Economy Research Institute (PERI), University of Massachusetts Amherst
Abstract:
This paper contributes to the literature on racial capitalism by deploying a key insight of the Law and Political Economy tradition, which is that politics acting through the law plays a constitutive role in the monetary hardwiring of economies and their property rights. By focusing on two key elements of fiscal finance, central banking and taxation, the paper shows that while the pressures of democratic self-governance created one type of hardwiring in Britain and its white dominions racialized politics created a different type in the colonies of color. In short, the particular monetary hardwiring of the colonies of color effectively “kicked away the ladder” needed for their successful socio-economic development, occluding the very different policies pursued in Britain and the dominions. This left the colonies of color in a vulnerable state at independence, providing much weaker foundations for their subsequent economic development. Given the key role played by gold in the anchoring of banknote emissions by the Bank of England (BoE) Britain’s global politics of gold and silver was central to its domestic economic development. And the BoE, a private joint-stock corporation, was deeply enmeshed in the government’s domestic and colonial governance policies. As with the BoE taxation systems domestically and internationally exemplified the same principle: private property was always embedded in the public sphere following different modes of governance in different historic and geographic contexts. Simply put, politics acting through the law was actively creating markets in different ways rather than protecting pre-existing and privately-created ones.
Topic:
Political Economy, Race, Governance, Capitalism, Empire, Money, and Property
Political Geography:
Global Focus

2742. Low-Carbon Transition Risks for Finance

Author:
Gregor Semieniuk, Emanuele Campiglio, and Neil Edwards
Publication Date:
10-2020
Content Type:
Working Paper
Institution:
Political Economy Research Institute (PERI), University of Massachusetts Amherst
Abstract:
The transition to a low‐carbon economy will entail a large‐scale structural change. Some industries will have to expand their relative economic weight, while other industries, especially those directly linked to fossil fuel production and consumption, will have to decline. Such a systemic shift may have major repercussions on the stability of financial systems, via abrupt asset revaluations, defaults on debt, and the creation of bubbles in rising industries. Studies on previous industrial transitions have shed light on the financial transition risks originating from rapidly rising “sunrise” industries. In contrast, a similar conceptual understanding of risks from declining “sunset” industries is currently lacking. We substantiate this claim with a critical review of the conceptual and historical literature, which also shows that most literature either examines structural change in the real economy, or risks to financial stability, but rarely both together. We contribute to filling this research gap by developing a consistent theoretical framework of the drivers, transmission channels, and impacts of the phase‐out of carbon‐intensive industries on the financial system and on the feedback from the financial system into the rest of the economy. We also review the state of play of policy aiming to protect the financial system from transition risks and spell out research implications.
Topic:
Climate Change, Finance, Economy, Risk, Fossil Fuels, Carbon Emissions, and Financial Systems
Political Geography:
Global Focus

2743. Should Economists Deceive? Prosocial Lying, Paternalism, and the ‘Ben Bernanke Problem’

Author:
George DeMartino
Publication Date:
11-2020
Content Type:
Working Paper
Institution:
Political Economy Research Institute (PERI), University of Massachusetts Amherst
Abstract:
A widely held principle in professional ethics, across the professions, is the duty to speak truthfully when engaging in professional activity. Expert truth-telling has come to be recognized as vital to the Kantian respect that is due to clients and others who must act based on professional advice; and to the imperative to sustain trust. It is therefore notable that economics does not generally require truth telling among its members. Against truth telling, in cases where what an economist says can impact social welfare, the profession tends toward “prosocial lying”—lying that is thought to be in society’s best interests. The case of central banker statements is paradigmatic. Would economists have preferred that Ben Bernanke tell the truth about the threats to the US and world economy in the early days of the crisis of 2008, when doing so might have destabilized financial markets further? But prosocial lying comes at a cost to the profession, and to society. Not least, prosocial lying reflects a paternalistic ethos that has by now been challenged in other professions; and the prevalence of prosocial lying may undermine trust—both among economists, and between economists and those economists purport to serve.
Topic:
Political Economy, Economy, and Paternalism
Political Geography:
Global Focus

2744. Inequality in Energy Consumption: Statistical Equilibrium or a Question of Accounting Conventions?

Author:
Gregor Semieniuk and Isabella Weber
Publication Date:
04-2020
Content Type:
Working Paper
Institution:
Political Economy Research Institute (PERI), University of Massachusetts Amherst
Abstract:
Mitigating climate change requires information about the inequality in energy consumption. Recent contributions (Banerjee and Yakovenko, 2010; Lawrence et al., 2013; Yakovenko, 2010, 2013) have studied energy inequality through the lens of maximum entropy. They claim a weighted international distribution of total primary energy demand should approach a Boltzmann-Gibbs maximum entropy equilibrium distribution in the form of an exponential distribution, implying convergence to a Gini coefficient of 0.5 from above. The present paper challenges the validity of this claim and critically discusses the applicability of statistical equilibrium reasoning to economics from the viewpoint of social accounting. It is shown that the exponential distribution is only a robust candidate for a statistical equilibrium of energy inequality when employing one particular accounting convention for energy flows, the substitution method. But this method has become problematic with a higher renewable share in the international energy mix, and no other accounting method supports the claim of a convergence to a 0.5 Gini. We conclude that the findings based on maximum entropy reasoning are sensitive to accounting conventions and critically discuss the epistemological implications of this sensitivity for the use of maximum entropy approaches in social sciences.
Topic:
Climate Change, Energy Policy, Inequality, Maximum Entropy, and Social Accounting
Political Geography:
Global Focus

2745. Path Dependence and Stagnation in a Classical Growth Model

Author:
Thomas R. Michl and Daniele Tavini
Publication Date:
04-2020
Content Type:
Working Paper
Institution:
Political Economy Research Institute (PERI), University of Massachusetts Amherst
Abstract:
This paper embeds a technical progress function in a classical growth model and studies the effects of permanent changes in parameters and temporary shocks such as pandemics. Technical change is driven by dynamic economies of scale and responds to distributional forces: the wage share regulates labor-saving technical change and employment regulates its capital using bias. The model features path dependence in the employment-population rate and the output-capital ratio. Population growth and distribution can respond to the employment rate. Interpreted through the model, secular stagnation under neoliberal capitalism has been driven by a combination of diminished investment.
Topic:
Political Economy, Economic Growth, COVID-19, Wage Growth, Path Dependency, Kaldor-Verdoorn Law, and Hysteresis
Political Geography:
Global Focus

2746. Political Economy of the Environment: A Look Back and Ahead

Author:
James K. Boyce
Publication Date:
06-2020
Content Type:
Working Paper
Institution:
Political Economy Research Institute (PERI), University of Massachusetts Amherst
Abstract:
The political economy of the environment aims to deepen our understanding of the interplay among the economy, the environment, and human well-being. In contrast to neoclassical environmental economics, it pays attention not only to the net magnitude of costs and benefits but also to their distribution. In the realm of positive analysis – descriptions of how the world works – this means exploring the multiple ways in which the distribution of wealth and power affects environmental outcomes. In the realm of normative analysis – prescriptions for how the world should work – political economists advocate a range of criteria including not only cost effectiveness but also safety, sustainability, and environmental justice.
Topic:
Environment, Political Economy, Sustainability, and Well-Being
Political Geography:
Global Focus

2747. Policy Papers by Women of Color: Diverse Voices on Chemical, Biological, Radiological & Nuclear Security, and Global Health Security Policy

Author:
Wardah Amir, Sara Z. Kutchesfahani, Jennyfer Ambe, Rahwa Osman, Seema Gahlaut, Nomsa Ndongwe, Togzhan Kassenova, Kimberly Ma, Jasmine Owens, Celeste Rogers, Sylvia Mishra, Liza Arias, Sumaya Malas, Jessica J. Lee, Jessica Gott, April Arnold, and Takiva Pierce
Publication Date:
10-2020
Content Type:
Policy Brief
Institution:
Women of Color Advancing Peace, Security and Conflict Transformation (WCAPS)
Abstract:
This edition features articles from member sin two of the WCAPS working groups: Chemical, Biological, Radiological & Nuclear Security; and Global Health Security. A critical goal of WCAPS is to cultivate a new generation of women of color in the areas of peace and security, foreign policy, and national security.
Topic:
Security, Nuclear Weapons, Treaties and Agreements, Infrastructure, Disarmament, Nonproliferation, Biological Weapons, Chemical Weapons, COVID-19, and Global Health
Political Geography:
China, North Korea, Global Focus, and United States of America

2748. Meet the Moment: A Call for Progressive Philanthropic Response to the Anti-Gender Movement

Author:
Teddy Wilson, Jenna Capeci, and Gitta Zomorodi
Publication Date:
11-2020
Content Type:
Special Report
Institution:
Global Philanthropy Project (GPP)
Abstract:
In early 2020, Global Philanthropy Project worked with our member organizations and philanthropic partners to develop two related pieces of private research: 1) a report mapping the funding of the global “anti-gender ideology” or “anti-gender” movement, and 2) a report mapping the progressive philanthropic response. We offer the following public document in order to share key learning and to offer additional analysis gained in the comparison of the two reports. Additionally, we share insights based on comparing global and regional LGBTI funding data as documented in the 2017-2018 Global Resources Report: Government and Philanthropic Support for Lesbian, Gay, Bisexual, Transgender, and Intersex Communities. These findings offer a clear call to action: progressive movements and their philanthropic partners are being outspent by hundreds of millions of dollars each year, and the institutions providing that opposition funding have developed sophisticated and coordinated systems to learn, co-fund, and expand their influence. The philanthropic community is called to recognize the scale of the fight and to be both rigorous and creative in our response. Let us seize this remarkable opportunity to work together and engage our collective learning, spending power, and institutional knowledge to help transform the conditions of our communities. Together we can leverage the collective power that this generational crisis demands.
Topic:
LGBT+, Progressivism, Philanthropy, Funding, Transgender, and Gender Minorities
Political Geography:
Africa, Russia, Europe, Asia, South America, Global Focus, and United States of America

2749. COVID-19 Future Trends: Impacts on Children and the Search for Opportunities

Author:
Sol Pradelli
Publication Date:
10-2020
Content Type:
Special Report
Institution:
Elevate Children Funders Group
Abstract:
This short thought-piece was commissioned by ECFG in September 2020 to help members navigate the uncertainty around how COVID would impact children in the longer-term. The paper includes a desk review of the impacts of previous pandemics and economic crises on children; an overview of likely impacts for children of the COVID crisis, including projections by age cohort; four potential scenarios and related planning questions; recommendations for funding, advocacy, and research; and a bibliography of key resources and reports.
Topic:
Children, Advocacy, COVID-19, Funding, and Economic Crisis
Political Geography:
Global Focus

2750. Who Owes? Class Struggle, Inequality and the Political Economy of Leverage as Power in the 21st Century

Author:
Stefano Sgambati
Publication Date:
08-2020
Content Type:
Working Paper
Institution:
City Political Economy Research Centre (CITYPERC), University of London
Abstract:
The prevalent consensus in critical social sciences is that finance articulates the world economy as a global hierarchy of creditor-debtor relations that reproduce and further aggravate existing income and wealth inequalities. Class struggle is conformingly understood as a conflict between elite creditors, members of the global top 1 percent of wealth holders, and mass debtors burdened by growing costs of servicing public and private debts. The article offers an alternative understanding of how debt, inequality and class relate to one another. At its basis is the recognition that over the past four decades finance has empowered upper class borrowers, including the top 1 percent, as it has magnified their capacity to generate capital gains and capture greater wealth and income shares via levered-up investments and other forms of ‘positioning’ in financial and property markets. The article thus provides a political economy of leverage as power and shows how contemporary global finance has not given shape to a distributional conflict between creditors and debtors as two distinct classes, but has set debtors against debtors, and namely the greater borrowers versus the lesser ones.
Topic:
Debt, Political Economy, Inequality, Finance, Class, Power, and Leverage
Political Geography:
Global Focus