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21. The evolution of the EU law against criminal finance: the "hardening" of FATF standards within the EU

Author:
Leonardo Borlinia and Francesco Montanaro
Publication Date:
03-2018
Content Type:
Working Paper
Institution:
Centre for Trade and Economic Integration, The Graduate Institute (IHEID)
Abstract:
This article examines the recent evolution of the EU anti-money-laundering (AML) and counter-terrorist financing (CTF) legislative framework, focusing on the relationship between the main international standards in the field and the newest EU legislation. It suggests that international soft law norms—in particular, the Financial Action Task Force (FATF) Recommendations—have had a decisive influence on the latest development of legislation at the EU level and within its member states. It further argues that mainly the preventive component of the AML/CTF legislation will be strengthened by the EU instruments adopted in mid-2015. However, this Article concludes that the adoption of global soft standards has posed significant challenges to the EU legislative framework. The arguments are developed in four parts. The Article first highlights the main regulatory prescriptions that stem from the study of the phenomenology and the economics of AML/CTF regulation and underpin the current international regulatory paradigm. Second, it explores the evolution of the main international instruments in the field with a special focus on the role played by the FATF Recommendations. It also illustrates the relation between these instruments and the adoption of the new EU AML/CTF legislation from two different, but complementary, angles: (1) noting that the current international AML/CTF framework has a multidisciplinary approach, the Article focuses on the framework's repressive component and assessing the limits of the EU criminal approach against money laundering and terrorist financing; and (2) examining the recent EU preventive legislation and addressing the main challenges posed to the EU legislative framework when attempting to accommodate global standards, especially regarding tensions with fundamental freedoms and human rights protected within the EU.
Topic:
Corruption, Crime, Economics, International Trade and Finance, Law, Finance, and Global Political Economy
Political Geography:
Global Focus

22. Could Trump Deliver Iran an Oil Windfall?

Author:
Richard Nephew
Publication Date:
07-2018
Content Type:
Commentary and Analysis
Institution:
Center on Global Energy Policy
Abstract:
The president’s recent statement that OPEC should reduce their prices may merely be an attempt to assign blame for rising gasoline prices in the midst of the US driving season or an even more cynical attempt to rally his political base in opposition to globalism. Or, it may have something to do with the president’s own decision to create a crisis with Iran. While attention is duly paid to how much Americans have to pay at the pump, a more subtle and complicated story will soon play out with respect to Iran and the reapplication of US sanctions ordered by Trump on May 8, 2018. In fact, unless oil prices are contained, the primary result of the president’s action may be to ensure that Iran profits from the oil market risks that sanctions have created.
Topic:
Energy Policy, Geopolitics, and Global Political Economy
Political Geography:
America, Iran, and Global Focus

23. The Crisis of Global Politics: Perspectives from Continental Philosophy

Author:
Josefin Graef, Scott Hamilton, Benjamin Martill, Elke Schwarz, and Uta Staiger
Publication Date:
08-2018
Content Type:
Special Report
Institution:
LSE IDEAS
Abstract:
Can the work of the great European philosophers help solve Europe's problems today? This report explores what we can learn from Heidegger, Arendt, and Anders about how to tackle populism, climate change, and technological change
Topic:
Political Theory and Global Political Economy
Political Geography:
Global Focus

24. Coming to Terms with China at the World Bank and in Development Finance

Author:
Scott Morris
Publication Date:
12-2018
Content Type:
Research Paper
Institution:
Center for Global Development
Abstract:
First, we should recognize that much of the value of the IFIs for the United States derives from their multilateral character. It greatly oversimplifies things to suggest they are strictly a US tool, available to do our bidding no matter what the issue. The reality is that when we want to get something done in these multilateral institutions, we need to work with other countries. In turn, these institutions are most effective when they have the buy-in of the largest number of their member countries. And when the United States is seeking something from them that doesn’t have broad-based support, it can be a tough road.
Topic:
Global Political Economy
Political Geography:
Global Focus

25. Striking a Balance: Straight Talk on the Global Economy

Author:
Michelle Nicholasen
Publication Date:
02-2018
Content Type:
Working Paper
Institution:
Weatherhead Center for International Affairs, Harvard University
Abstract:
or more than two decades, economist Dani Rodrik has warned about the dangers of what he has called “hyperglobalization.” He has long argued that national economies and domestic policies should have priority amidst a rising tide of unfettered globalization and open markets. Today we have some evidence that he was right. Our race toward “one world economy” has produced consequences in the form of global social inequality and populist or extremist political movements, for example. Rodrik envisions a way to keep bringing down trade barriers while maintaining the integrity of the nation-state. His latest book, Straight Talk on Trade, is a synthesis of his monthly columns for Project Syndicate, and functions as a roadmap of Rodrik’s prolific analyses. The Weatherhead Center spoke to him about his long view on world economies.
Topic:
Globalization, Science and Technology, and Global Political Economy
Political Geography:
Global Focus

26. Cost of Aging

Author:
Ronald Lee and Andrew Mason
Publication Date:
03-2017
Content Type:
Commentary and Analysis
Institution:
East-West Center
Abstract:
In advanced economies around the world, population growth is slowing down and populations are growing older. Economic growth is also slowing, at least in part because of the slow growth of the labor force and of populations as a whole—despite immigration. Many empirical studies have found that gross domestic product (GDP) growth slows roughly one to one with declines in labor-force and population growth—a disquieting prospect for the United States and for advanced economies in Asia and Europe. If there are fewer workers to support a growing elderly population and worker productivity remains the same, either consumption must be reduced or labor supply increased—for example, through later retirement. By 2050, the projected slowdown in growth of the labor supply could lead to a drop in consumption of 25 percent in China, 9 percent in the United States, and 13 percent in other high-income countries. The situation could be improved, however, by a rise in labor-force productivity. In fact, standard growth models predict that slower population growth will lead to rising output and wages per worker. The underlying question is whether this higher output per worker will be sufficient to offset the rise in the number of dependents per worker as the population ages. To help answer this question, this article looks more closely at how economic activity varies by age, drawing on national transfer accounts, which measure how people at various ages produce, consume, and save resources. This analysis shows that GDP and national income growth will most certainly slow down as populations age, but the effect on individuals—as measured by per capita income and consumption—may be quite different.
Topic:
International Relations and Global Political Economy
Political Geography:
Global Focus

27. The Labor Market Effects of Refugee Waves: Reconciling Conflicting Results

Author:
Michael Clemens and Jennifer Hunt
Publication Date:
05-2017
Content Type:
Working Paper
Institution:
Center for Global Development
Abstract:
An influential strand of research has tested for the effects of immigration on natives’ wages and employment using exogenous refugee supply shocks as natural experiments. Several studies have reached conflicting conclusions about the effects of noted refugee waves such as the Mariel Boatlift in Miami and post-Soviet refugees to Israel. We show that conflicting findings on the effects of the Mariel Boatlift can be explained by a sudden change in the race composition of the Current Population Survey extracts in 1980, specific to Miami but unrelated to the Boatlift. We also show that conflicting findings on the labor market effects of other important refugee waves can be produced by spurious correlation between the instrument and the endogenous variable introduced by applying a common divisor to both. As a whole, the evidence from refugee waves reinforces the existing consensus that the impact of immigration on average native-born workers is small, and fails to substantiate claims of large detrimental impacts on workers with less than high school.
Topic:
Refugee Issues, Financial Markets, and Global Political Economy
Political Geography:
Global Focus

28. Gender Matters in Economic Empowerment Interventions: A Research Review

Author:
Mayra Buvinic and Megan O'Donnell
Publication Date:
05-2017
Content Type:
Working Paper
Institution:
Center for Global Development
Abstract:
A review of the recent evaluation evidence on financial services and training interventions questions their gender neutrality and suggests that some design features in these interventions can yield more positive economic outcomes for women than for men. These include features in savings and ‘Graduation’ programs that increase women’s economic self-reliance and self-control, and the practice of repeated micro borrowing that increases financial risk-taking and choice. ‘Smart’ design also includes high quality business management and jobs skills training, and stipends and other incentives in these training programs that address women’s additional time burdens and childcare demands. Peer support may also help to increase financial risk taking and confidence in business decisions, and may augment an otherwise negligible impact of financial literacy training. These features help women overcome gender-related constraints. However, when social norms are too restrictive, and women are prevented from doing any paid work, no design will be smart enough. Subjective economic empowerment appears to be an important intermediate outcome for women that should be promoted and more reliably and accurately measured. More research is also needed on de-biasing service provision, which can be gender biased; lastly, whenever possible, results should be sex-disaggregated and reported for individuals as well as households.
Topic:
Gender Issues, International Trade and Finance, and Global Political Economy
Political Geography:
Global Focus

29. Expanding Global Liquidity Insurance: Myths and Realities of the IMF’s Precautionary Credit Lines

Author:
Nancy Birdsall, Liliana Rojas-Suarez, and Anna Diofasi
Publication Date:
02-2017
Content Type:
Working Paper
Institution:
Center for Global Development
Abstract:
Despite increasing volatility in the global economy, the uptake of the IMF’s two precautionary credit lines, the Flexible Credit Line (FCL) and the Precautionary and Liquidity Line (PLL), has remained limited—currently to just four countries. The two new lending instruments were created in the wake of the global financial crisis of 2008 to enable IMF member states to respond quickly and effectively to temporary balance of payment needs resulting from external shocks. Both credit lines offer immediate access to considerable sums—over 10 times a country’s IMF quota in some cases with no (FCL) or very limited (PLL) conditionality. This paper addresses four misconceptions (or ‘myths’) that have likely played a role in the limited utilization of the two precautionary credit lines: 1) too stringent qualification criteria that limit country eligibility; 2) insufficient IMF resources; 3) high costs of precautionary borrowing; and 4) the economic stigma associated with IMF assistance. We show, in fact, that the pool of eligible member states is likely to be seven to eight times larger than the number of current users; that with the 2016 quota reform IMF resources are more than adequate to support a larger precautionary portfolio; that the two IMF credit lines are among the least costly and most advantageous instruments for liquidity support countries have; and that there is no evidence of negative market developments for countries now participating in the precautionary lines.
Topic:
International Trade and Finance and Global Political Economy
Political Geography:
Global Focus

30. Fiscal Policy, Income Redistribution and Poverty Reduction in Low and Middle Income Countries

Author:
Nora Lustig
Publication Date:
01-2017
Content Type:
Working Paper
Institution:
Center for Global Development
Abstract:
Current policy discussion focuses primarily on the power of fiscal policy to reduce inequality. Yet, comparable fiscal incidence analysis for 28 low and middle income countries reveals that, although fiscal systems are always equalizing, that is not always true for poverty. In Ethiopia, Tanzania, Ghana, Nicaragua, and Guatemala the extreme poverty headcount ratio is higher after taxes and transfers (excluding in-kind transfers) than before. In addition, to varying degrees, in all countries a portion of the poor are net payers into the fiscal system and are thus impoverished by the fiscal system. Consumption taxes are the main culprits of fiscally-induced impoverishment. Net direct taxes are always equalizing and indirect taxes net of subsidies are equalizing in nineteen countries of the 28. While spending on pre-school and primary school is pro-poor (i.e., the per capita transfer declines with income) in almost all countries, pro-poor secondary school spending is less prevalent, and tertiary education spending tends to be progressive only in relative terms (i.e., equalizing but not pro-poor). Health spending is always equalizing but not always pro-poor. More unequal countries devote more resources to redistributive spending and appear to redistribute more. The latter, however, is not a robust result across specifications.
Topic:
International Trade and Finance and Global Political Economy
Political Geography:
Global Focus