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561. Firm Profits and Government Activity: An Empirical Investigation

Author:
Petar Jolakoski, Branimir Jovanovic, Joana Madjoska, Viktor Stojkoski, and Dragan Tevdovski
Publication Date:
02-2021
Content Type:
Working Paper
Institution:
The Vienna Institute for International Economic Studies (WIIW)
Abstract:
If firm profits rise to a level far above than what would have been earned in a competitive economy, this might give the firms market power, which might in turn influence the activity of the government. In this paper, we perform a detailed empirical study on the potential effects of firm profits and markups on government size and effectiveness. Using data on 30 European countries for a period of 17 years and an instrumental variables approach, we find that there exists a robust relationship between firm gains and the activity of the state, in the sense that higher firm profits reduce government size and effectiveness. Even in a group of developed countries, such as the European countries, firm power may affect state activity.
Topic:
Development, Economics, Government, International Political Economy, and Profit
Political Geography:
Europe and Global Focus

562. China Strengthens Its Economic Security

Author:
Takahiro Tsuchiya
Publication Date:
05-2021
Content Type:
Research Paper
Institution:
Japan Institute Of International Affairs (JIIA)
Abstract:
"Economic security" has been gathering attention in recent years. The main reasons for this are (1) neo-globalization, (2) the achievement of objectives by major powers using the "economic statecraft"1 approach, and (3) the development of "game-changing" and other emerging technologies. In particular, there has been a heightened sense of international concern about China's attempts to coerce, demand obedience, or persuade other countries by acquiring/securing technologies (resorting to economic espionage if necessary) and human resources and by leveraging its economic power.
Topic:
Development, Science and Technology, Xi Jinping, and Economic Security
Political Geography:
China and Asia

563. How difficult is China’s business environment for European and American companies?

Author:
Uri Dadush and Pauline Weil
Publication Date:
05-2021
Content Type:
Policy Brief
Institution:
Bruegel
Abstract:
Despite tensions over China’s discriminatory business practices, China’s trade continues to thrive, and the country has taken over from the United States as the first destination for foreign investment. American and European businesses continue to be engaged in China’s large and growing market, even amid a trade war between China and the United States. Drawing on surveys of companies and international comparisons, we show that – contrary to the prevailing narrative – China’s business practices have improved significantly in recent years. China’s business environment is today generally more favourable than that in other large countries at similar levels of development and, in some though certainly not all aspects, is in line with the Organisation for Economic Co-operation and Development average. Differences over geopolitics and human rights must be addressed, but it is clear that trade and investment agreements conditioned on accelerated reforms in China would yield substantial dividends. The benefits of such deals would accrue not only to foreign investors in China and exporters to China, but also to consumers and importers in the European Union and, especially, in the US, where punitive tariffs on China remain in effect. Critical aspects in the negotiations would include better access for American and European investors to China’s market for services and improved enforcement of rules and regulations in China. As in many middle-income countries, uneven enforcement of the law (rather than the law itself) remains a critical problem in China.
Topic:
Development, Bilateral Relations, European Union, Business, and Investment
Political Geography:
China, Europe, Asia, North America, and United States of America

564. Technology Development of Digital Currency

Author:
Neha Narula
Publication Date:
06-2021
Content Type:
Journal Article
Journal:
The Cato Journal
Institution:
The Cato Institute
Abstract:
We often spend a lot of time talking about the regulatory aspects of what a digital currency might look like, or the economic aspects. But if we take a look at the largest companies, the most influential on our ways of life, they’re tech companies. Technology is incredibly important and influences what we can do with policy and what kinds of functionality we can even enable. So, what I hope to tell you today is a little bit about how I’m seeing the technology development of digital currency.
Topic:
Development, Science and Technology, Monetary Policy, and Digital Currency
Political Geography:
Global Focus

565. The Remittance Effect: A Lifeline for Developing Economies Through The Pandemic and into Recovery

Author:
Oxford Economics
Publication Date:
01-2021
Content Type:
Commentary and Analysis
Institution:
Oxford Economics
Abstract:
The rising value of remittance flows into developing countries in recent years is often not widely appreciated. At a macro level, remittances support growth and are less volatile than other private capital flows, tending to be relatively stable through the business cycle. At a micro level, remittances benefit recipient households in developing countries by providing an additional source of income and lower incidences of extreme poverty. Remittances act as a form of 'social insurance', supporting households' capabilities to resist economic shocks. Remittances help recipient households to increase spending on essential goods and services, invest in healthcare and education, as well as allowing them to build their assets, both liquid (cash) and fixed (property), enhancing access to financial services and investment opportunities. Understanding the role and importance of remittances is particularly important at the current juncture, with the global economy experiencing a uniquely sharp and synchronized shock as a result of COVID-19. This report examines the available evidence on remittance flows and their potential economic effects. The report explores and shows how remittance flows remain a crucial lifeline in supporting developing economies through the current pandemic crisis and into the recovery. Although remittances slowed during the pandemic, they remained more resilient than other private capital flows, making them even more important as a source of foreign inflows for receiving countries. While the World Bank estimates that remittance flows to developing countries (low-and-middle income economies) contracted by 7.0% in 2020, this decline is likely to have been far less severe than the downturn in private investor capital. Looking forward, the World Bank predicts that remittance flows to developing countries will contract by a further 7.5% in 2021. But the outlook remains subject to a high degree of uncertainty with both upside and downside risks. A wider set of dynamics – including central bank data outturns for 2020, economic outlooks for the world economy in 2021, survey data and remittance consumer market fundamentals – suggest that while there are downside risks, there is also potential that 2020 and 2021 will not turn out as weak as predicted by the World Bank and for a period of strong remittance growth in the medium-term as sender economies recover and demand from developing economies remains high.
Topic:
Development, Recovery, Economic Development, Pandemic, and COVID-19
Political Geography:
Global Focus

566. Examining the Potential of Conditional Cash Transfer for Stemming Cape Flats Gang Violence: A Directional Policy Research Project

Author:
Joseph Olusegun Adebayo and Blessing Makwambeni
Publication Date:
01-2021
Content Type:
Journal Article
Journal:
African Journal on Conflict Resolution
Institution:
The African Centre for the Constructive Resolution of Disputes (ACCORD)
Abstract:
Many low and middle-income countries have either implemented or considered conditional or unconditional cash transfers to poor households as a means of alleviating poverty. Evidence from pilot schemes in many developed and developing economies, including those in Africa, suggests that cash transfers do not only alleviate poverty; they also promote social cohesion and reduce the propensity for violent responses. For example, studies have shown a direct impact of cash transfers on Intimate Partner Violence (IPV). In some studies, the rate of IPV (including emotional violence) was significantly reduced when one of the partners was a beneficiary of cash transfer. However, there are limited studies on the potential of Conditional Cash Transfers (CCTs) for stemming gang violence. Our study contributes to filling this gap. We examine here the possibilities of conditional cash transfers for stemming intractable gang-related violence in the Cape Flats.
Topic:
Development, Violence, Gangs, and Cash
Political Geography:
Africa and South Africa

567. Establishing the empirical basis for tracing the development outcomes of agricultural investments

Author:
Helle Munk Ravnborg, Bernard Bashaasha, Rikke Broegaard, Michael Byaruhanga, Evelyne Lazaro, Festo Maro, Khamaldin Mutabazi, Teddy Nakanwagi, and David Tumusiime
Publication Date:
04-2021
Content Type:
Working Paper
Institution:
Danish Institute for International Studies (DIIS)
Abstract:
This DIIS Working Paper describes the design of a questionnaire survey developed and implemented in order to trace the development outcomes of foreign agricultural investments in six research locations in Tanzania and Uganda. The questionnaire survey was conducted as part of the Agricultural Investors as Development Actors (henceforward AIDA) research programme which, in particular, focuses on development outcomes in terms of employment, migration, food security and wider dynamic economic effects, such as access to technology, infrastructure and markets; land markets and perceived security of land tenure; and water access and security of tenure. The working paper which serves as a methodological reference document describes the approach which was employed for drawing six independent samples of 400 respondents each, as well as the approach developed for computing a foreign agricultural investment exposure index and for computing a locally informed household poverty index.
Topic:
Agriculture, Climate Change, Development, Economics, Emerging Markets, Environment, Poverty, Water, Food, Governance, Inequality, Investment, and Land Rights
Political Geography:
Sub-Saharan Africa and Africa

568. To Beat China On Tech In Emerging Markets, Learn From It: Competing with China on 5G and future technologies

Author:
Luke Patey
Publication Date:
05-2021
Content Type:
Policy Brief
Institution:
Danish Institute for International Studies (DIIS)
Abstract:
Recommendations: The US, South Korea, Japan, and the EU can pool resources to level the playing field with China and offer new finance options for developing countries seeking to upgrade their communications and technology infrastructure. The US should look to the India and Vietnam model and help other nations develop domestic capacities that lower dependencies on Huawei and other foreign tech providers over time. Open RAN is no silver bullet to compete with China. Its potential will only be fully realized in the mid and long run, after high integration costs, security gaps, and other problems are worked out.
Topic:
Security, Foreign Policy, Development, Politics, Science and Technology, Power Politics, Economy, and Cyberspace
Political Geography:
Japan, China, Asia, North America, and United States of America

569. Eliminating child marriage in Ethiopia

Author:
Fana Gebresenbet
Publication Date:
06-2021
Content Type:
Working Paper
Institution:
Danish Institute for International Studies (DIIS)
Abstract:
How can we explain the large gap between national legal and policy commitments to reduce and eliminate gender-based violence (GBV) and the reality and practice of GBV in Ethiopia? Hitherto explanations mainly centre on the conflict between and social and official norms, and the stubbornness of the former. In this new DIIS Working Paper, Fana Gebresenbet tries to go beyond this dichotomy to examine what happens in the ‘in-between spaces’. While the stubbornness of social norms only brings home to us the slow pace of change, it does not tell us what guides the emerging practices that contribute towards change. Instead, ‘practical norms’ are used here as an analytical tool to examine what happens as we move along the continuum from social to official norms. This helps us capture why routinised, coordinated and socially acceptable new practices occur before the major social norms change. This work is part of GLOW (Global Norms and Violence Against Women in Ethiopia), a research programme financed by the Danish Ministry of Foreign Affairs and coordinated by DIIS.
Topic:
Development, Diplomacy, International Organization, Poverty, Children, Women, and Inequality
Political Geography:
Africa and Ethiopia

570. Risks of technology use in humanitarian settings: Avoiding harm, delivering impact

Author:
Adam Moe Fejerskov, Maria-Louise Clausen, and Sarah Seddig
Publication Date:
08-2021
Content Type:
Policy Brief
Institution:
Danish Institute for International Studies (DIIS)
Abstract:
The use of emerging technology in humanitarian settings carries significant risks. The complexity of these risks entails a need to understand and imagine risks beyond those commonly associated with a particular technology, field, or implementing organization. Recommendations: Apply an extensive interpretation of what risks may look like, where, when, for whom, and how they might occur. The indiscernible nature of risks related to technology use means identifying or imagining these moves beyond existing organizational experiences. Recognize that technology-related risks can emerge across the data chain and are not only relevant for engineering or operational staff.
Topic:
Security, Democratization, Development, Migration, Poverty, Science and Technology, Capitalism, Inequality, Conflict, Borders, Violence, and Peace
Political Geography:
Global Focus