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2691. Moral Hazard in an Economic Union: Politics, Economics, and Fiscal Gimmickry in Europe

Author:
James Alt, David Dreyer Lassen, and Joachim Wehner
Publication Date:
07-2012
Content Type:
Working Paper
Institution:
Weatherhead Center for International Affairs, Harvard University
Abstract:
This paper examines empirically how transparency of the budget process affects fiscal rules and incentives for fiscal gimmickry or creative accounting in the European Union. Using stock-flow adjustment data for EU countries from 1990-2007, we show that pressure from a deficit limit rule as in the Stability and Growth Pact creates incentives for fiscal gimmicks, as does political pressure from the electoral cycle and economic pressure from negative shocks in the business cycle. However, we show that where institutional transparency is higher, these incentives are damped and largely disappear. We infer that fiscal rules do not work well when institutional transparency is low.
Topic:
Economics, International Trade and Finance, Monetary Policy, and Financial Crisis
Political Geography:
Europe

2692. The Imperial Peace in Colonial Africa and Africa's Underdevelopment

Author:
Robert H. Bates
Publication Date:
12-2012
Content Type:
Book
Institution:
Weatherhead Center for International Affairs, Harvard University
Abstract:
When praised at all, imperialism is most often commended for the peace it bestowed. By demobilizing armies, deposing marauding princes and subduing war-like states, European powers fashioned a half-century of political order. The question nonetheless arises: Should they be lauded for that? In this chapter, I view Africa's history through the lens of comparative history and argue that the imperial peace may have retarded Africa's development.
Topic:
Development, Economics, Imperialism, Post Colonialism, and Natural Resources
Political Geography:
Africa and Europe

2693. Commission v. Gazprom: The antitrust clash of the decade?

Author:
Alan Riley
Publication Date:
10-2012
Content Type:
Policy Brief
Institution:
Centre for European Policy Studies
Abstract:
It may well be that the Gazprom antitrust case launched by DG Competition on September 4th will turn out to be the landmark antitrust case of this decade, as Microsoft was of the last decade. The argument of this paper is that, for a host of political and economic reasons, this case is likely to be hard fought by both sides to a final prohibition decision and then onwards into the EU courts. In the process, the European gas market and the powers of DG Competition in the energy field are likely to be transformed.
Topic:
Economics, Markets, Natural Resources, and Law
Political Geography:
Europe

2694. Towards a Stronger Africa-EU Cooperation on Peace and Security: The Role of African Regional Organizations and Civil Society

Author:
Nicoletta Pirozzi, Valérie Vicky Miranda, and Kai Schäfer
Publication Date:
10-2012
Content Type:
Working Paper
Institution:
Istituto Affari Internazionali
Abstract:
The Joint Africa-European Union Strategy, adopted at the Lisbon Summit in December 2007, was intended to overcome an unequal partnership between the African and European continents by establishing a framework of cooperation based on shared values and common objectives. However, in the first implementation phase it became clear that these conditions were far from being fully realized. In particular, the Partnership on Peace and Security has shown a tendency to institutionalize dialogue and crystallize practices of cooperation along the well-established Brussels-Addis Ababa axis, while efforts to engage with other crucial actors remain to some extent limited. This paper focuses on the sub-optimal involvement of two crucial stakeholders, namely African regional organizations and civil society actors. It presents the main findings and policy recommendations of a study concluded by IAI in September 2012, with the support of the Foundation for European Progressive Studies (FEPS) and the European Parliament.
Topic:
Civil Society and Bilateral Relations
Political Geography:
Africa and Europe

2695. Defence Spending in Europe in Light of the Economic Crisis

Author:
Alessandro Marrone
Publication Date:
10-2012
Content Type:
Working Paper
Institution:
Istituto Affari Internazionali
Abstract:
The economic crisis has impacted deeply on defence spending in Europe. It has led to uncoordinated cuts to defence budgets at national level, but has also revived interest in bilateral and multilateral cooperation. Both the EU and NATO have made an effort to involve European countries in cooperative projects, under the banner s of “Pooling and Sharing” and “Smart Defence” respectively, with limited results. At the same time, the European Commission has adopted two directives regarding defence spending, and the European Defence Agency has been strengthened. While defence spending remains predominantly a national prerogative, European countries will soon face the choice of pooling certain capabilities at international level or losing them because of insufficient spending. In this light, Italy is rationalizing its defence budget, while preserving its commitments to international cooperation.
Topic:
Defense Policy, NATO, Economics, and Financial Crisis
Political Geography:
Europe

2696. The Consolidation of the Anglo-Saxon/European Consensus on Price Stability. From International Coordination to a Rule-Based Monetary Regime

Author:
Arie Krampf
Publication Date:
10-2012
Content Type:
Working Paper
Institution:
The Kolleg-Forschergruppe (KFG)
Abstract:
During the 1990s, a consensus consolidated among policy makers and economists worldwide regarding the desirability of very low inflation targeting. So far, this process has been explained on the basis of a domestic- functional thesis, according to which commitment to very low inflation provides local economic gains with no costs. In this paper, I present an alternative explanation, according to which the global norm of very low inflation targeting was consolidated as a political solution to the problem of exchange rate misalignment and volatility. I argue that policy makers in Germany and the US believed that convergence of monetary policies and inflation rates, in addition to liberalization of financial markets, will stabilize exchange rates without the need for direct coordination. The paper employs the theory of liberal intergovernmentalism as a benchmark to explain the choice of the European and the G-5/7 countries to establish a low-inflation rule-based international monetary regime. The paper concludes that the regime of very low inflation targeting was consolidated as a politically viable solution to a political problem rather than as an economic best practice. Furthermore, it concludes that the norm of very low inflation targeting was a “corer solution” that neglected the problem of exchange rate stability.
Topic:
Economics, Markets, Political Economy, Monetary Policy, and Financial Crisis
Political Geography:
United States and Europe

2697. Not Another GMO. Explaining Europe's Approach to Nanotechnologies

Author:
Nico Jaspers
Publication Date:
09-2012
Content Type:
Working Paper
Institution:
The Kolleg-Forschergruppe (KFG)
Abstract:
Despite early warnings about “knowledge-enabled mass destruction” and the ongoing battle over agricultural biotechnology, the development of nanotechnology in Europe has been remarkably quiet over the past decade: non-governmental organization (NGO) campaigns against “nano” were all but inexistent and the wider public appears largely uninterested in nanotechnology. Why has Europe's experience with nanotechnologies been so fundamentally different from that with genetically modified organisms (GMOs)? This article argues that differences in the technologies as such cannot fully explain this divergence. Instead, a convergence of interests across key groups of stakeholders, the institutional evolution of the European Union (EU) and the experience from the GMO case enabled and facilitated a highly anticipatory and proactive approach to nanotechnology risk governance. This approach, marked by early capacity building, stake - holder involvement and gradual regulation succeeded in avoiding public polarization and in promoting a responsible development of nanotechnologies.
Topic:
Development, Science and Technology, and Biosecurity
Political Geography:
Europe

2698. Grounding the European Public Sphere. Looking Beyond the Mass Media to Digitally Mediated Issue Publics

Author:
Lance Bennett
Publication Date:
08-2012
Content Type:
Working Paper
Institution:
The Kolleg-Forschergruppe (KFG)
Abstract:
The gold standard for discussing public spheres has long been established around mass media, with the prestige print press given a privileged place. Yet when it comes to a European public sphere, the mass media are also problematic, or at least incomplete, in several ways: relatively few EU-wide issues are replicated in the national media of EU countries, the discourses on those issues are dominated primarily by elites (with relatively few civil society voices included in the news), and public attention is seldom paid to EU issues beyond a select few (money, agriculture, political integration, scandals), creating a distant 'gallery public.' At the same time, many important political issues such as trade and economic justice, development policy, environment and climate change policy, human rights, and military interventions, among others, are being addressed more actively by networks of civil society actors both within and across EU national borders. These networks utilize the Internet and various interactive digital media to publicize their issues, engage active publics, and contest competing policy perspectives not only within specific issue networks, but across solidarity networks involving other policy issues, and with political targets at national and EU levels. This dimension of the EU public sphere has received relatively little attention from observers, and when it has been explored, it is often dismissed as less inclusive, and therefore less significant than the somewhat reified mass media model. This analysis compares networked, digitally mediated public issue spheres with the mass mediated model, points out ways in which the two types of public sphere are complementary, and also shows how networked issue spheres may be the sites of greater citizen and civil society engagement in keeping with more classical models of public spheres.
Topic:
Civil Society, Science and Technology, and Mass Media
Political Geography:
Europe

2699. The Holy Trinity of Democracy, Economic Development, and Security. EU Democratization Efforts Beyond its Borders - The Case of Tunisia

Author:
Assem Dandashly
Publication Date:
07-2012
Content Type:
Working Paper
Institution:
The Kolleg-Forschergruppe (KFG)
Abstract:
The EU has been engaged in democracy promotion, human rights, and civil liberties in the Mediterranean countries for over two decades with results ranging from very limited success to total failure. The revolutions in the Arab world – that have caught the EU and Western countries by surprise – provide a window of opportunity for real democratic reforms in the region. The successful democratization in Tunisia will send positive messages to the neighboring countries. Why should the EU be more involved in supporting Tunisia's democratic transition? And what can the EU do to support Tunisia's efforts to build and reform its institutions and to move towards a consolidated democracy with a functioning market economy? Answering these research questions requires understanding the major failures of the EU in the Mediterranean region – the Union of the Mediterranean is on hold and conditionality (at least political conditionality) is problematic and questionable. Prior to the Dignity Revolution, security and stability were moving in the opposite direction to democracy –leading the EU to focus more on the former. Now, consolidating democracy, economic development, stability, and security on the EU's Southern borders are moving in the same direction. This paper argues that, first, supporting democracy is a necessary condition for guaranteeing stable and secure southern borders and, secondly, economic growth is a necessary condition for consolidating democracy and political reforms in Tunisia.
Topic:
Civil Society, Democratization, Development, and Foreign Aid
Political Geography:
Europe, Arabia, North Africa, and Tunisia

2700. Tolerance as a European Norm or an Ottoman Practice? An Analysis of Turkish Public Debates on the (Re)Opening of an Armenian Church in the Context of Turkey's EU Candidacy and Neo-Ottoman Revival

Author:
Bilgin Ayata
Publication Date:
07-2012
Content Type:
Working Paper
Institution:
The Kolleg-Forschergruppe (KFG)
Abstract:
Turkey has undergone significant legal and institutional reforms regarding minority rights and cultural rights in the past decade as part of a reform process to meet political criteria for EU membership. However, it has not been studied so far if this increasing institutional compliance has also led to transformations at a normative level in the public discourse in Turkey. To explore this question, this paper presents the results of a qualitative media analysis that I conducted on the restoration and reopening of an Armenian church in 2007 – a milestone for the Republic as churches were destroyed or doomed to vanish for nearly a century since the Armenian Genocide in 1915. The restoration of the Sourp Khatch/Akhtamar Church became a showcase for Turkey's self-promotion as a 'tolerant nation'. However, the church was notably made accessible to the public as a museum that initially lacked the cross on its dome and was conceived to only host a religious service once a year. This opening of a church-museum is a symbolic instance in Turkey's ongoing transformation process in which tolerance and plurality have become prominent keywords in politics and public debate. Yet, as the findings suggest, they do not so as a reflection of European norms, but rather stand for a rediscovery and reinterpretation of Turkey's Ottoman past practices as a multi-religious empire. I show, however, that this reinterpretation occurs on the shaky grounds of a blindfolded view of the past, in particular the denial of the Armenian Genocide, and on the denial that minorities are still endangered in present day Turkey. I conclude that, without an acknowledgement of the Armenian Genocide, Turkey's nostalgic embracement of the Ottoman past and representation of norms such as tolerance as the 'true' Turkish/Islamic norms do not stand for a norm internalization or a norm adaption process, but instead, for a disconnection between norm and practice.
Topic:
Civil War, Democratization, Ethnic Conflict, and Insurgency
Political Geography:
Europe, Turkey, and Asia