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211. Some Thoughts on International Monetary Policy Coordination

Author:
Charles I. Plosser
Publication Date:
06-2018
Content Type:
Journal Article
Journal:
The Cato Journal
Institution:
The Cato Institute
Abstract:
It is a pleasure to be back here at Cato and to be invited to speak once again at this annual conference. This is one of the premier ongoing monetary policy conferences, and the participants, both at the podium and in the audience, attest to its prominence. This is a session on international monetary arrangements, and there has already been an interesting discussion. I find myself in substantial agreement with the comments of John Taylor, so I do not wish to repeat his points. What I will try to do is put the rules-based approach to international monetary policy coordination in a context that I hope will help us understand some of the past failures so we might avoid them in the future. In many ways, I will simply be reminding us of some principles we all have known for some time, yet which we seem to forget all too frequently.
Topic:
International Cooperation, Monetary Policy, and Banks
Political Geography:
Global Focus

212. The Case for a New International Monetary System

Author:
Judy Shelton
Publication Date:
06-2018
Content Type:
Journal Article
Journal:
The Cato Journal
Institution:
The Cato Institute
Abstract:
How often do we hear references to the notion that we live in a rules-based global trading system? Addressing the World Economic Forum at Davos in January 2017, British Prime Minister Theresa May praised liberalism, free trade, and globalization as “the forces that underpin the rules-based international system that is key to our global prosperity and security” (Martin 2017). Chinese President Xi Jinping likewise extolled the virtues of a rules-based economic order at Davos, winning widespread praise for defending free trade and globalization (Fidler, Chen, and Wei 2017). But could someone please explain: What exactly are those rules? Because if we are going to invoke the sentimentality of Bretton Woods by suggesting that the world has remained true to its precepts, we are ignoring geopolitical reality. Moreover, we are denying the warped economic consequences of global trade conducted in the absence of orderly currency arrangements. We have not had a rules-based international monetary system since President Nixon ended the Bretton Woods agreement in August 1971. Today there are compelling reasons—political, economic, and strategic—for President Trump to initiate the establishment of a new international monetary system.
Topic:
Economics, International Cooperation, and Monetary Policy
Political Geography:
Global Focus

213. Toward a Rules‐​Based International Monetary System

Author:
John B. Taylor
Publication Date:
06-2018
Content Type:
Journal Article
Journal:
The Cato Journal
Institution:
The Cato Institute
Abstract:
Over the past few years I have been making the case for moving toward a more rules-based international monetary system (e.g., Taylor 2013, 2014, 2015, 2016a, 2016b, 2017). In fact, I made the case over 30 years ago in Taylor (1985), and the ideas go back over 30 years before that to Milton Friedman (1953). However, the case for such a system is now much stronger because the monetary system drifted away from a rules-based approach in the past dozen years and, as Paul Volcker (2014) reminds us, the absence of a rulesbased monetary system “has not been a great success.” To bring recent experience to bear on the case, we must recognize that central banks have been using two separate monetary policy instruments in recent years: the policy interest rate and the size of the balance sheet, in which reserve balances play a key role. Any international monetary modeling framework used to assess or to make recommendations about international monetary policy must include both instruments in each country, the policy for changing the instruments, and the effect of these changes on exchange rates. Using such a framework, I show that both policy instruments have deviated from rules-based policy in recent years. I then draw the policy implications for the international monetary system and suggest a way forward to implement the policy.
Topic:
International Cooperation, International Trade and Finance, Monetary Policy, and Central Bank
Political Geography:
Global Focus

214. Financialization, Trade, and Investment Agreements: Through the Looking Glass or Through the Realities of Income Distribution and Government Policy?

Author:
Alex Izurieta, Pierre Kohler, and Juan Pizarro
Publication Date:
09-2018
Content Type:
Working Paper
Institution:
Global Development and Environment Institute at Tufts University
Abstract:
This paper assesses the effects of trade and investment agreements on income distribution and government policy. The critical process underpinning these effects is the rise of ‘financialization’. Global patterns of greater financialization and of worsening functional income distribution as well as tighter fiscal stances are identified in the data. Tests are conducted by combining financial statistics with databases of bilateral investment agreements and free trade agreements, as well as data generated by the UN Global Policy Model that encompasses several fiscal policy instruments. The empirical validation of these relationships brings to the fore the policy-oriented debate about the purported benefits of modern-era ‘comprehensive’ trade and investment agreements such as TTIP, TTP and CETA. The authors corroborate the findings of their respective earlier studies of these agreements and reiterate their call for caution. To preserve policy space and to avert increases of inequality, policy-makers should resist pressures to get their economies locked in such agreements and should look instead for sustainable forms of international policy coordination.
Topic:
International Cooperation, United Nations, Investment, and Trade
Political Geography:
Global Focus

215. The UN Security Council: From a 20th Century Relic to Effective Security Governance

Author:
Jakkie Cilliers
Publication Date:
02-2018
Content Type:
Working Paper
Institution:
Institute for Development and Peace
Abstract:
The United Nations Security Council lies at the heart of the global security architecture. It was established in 1945 to maintain international peace and security, but reform has been stuck for decades. Beyond a nuclear conflagration and the enduring challenge of interstate conflict, future global security challenges include the impact of climate change, the threat of pandemics, dirty bombs, nuclear terrorism and cybercrime. These risks are exacerbated by the rise of new nationalism in the West with countries such as the USA turning away from multilateralism, eschewing collaboration and accelerating change away from a global system hitherto dominated by the West. At a time of great power transitions, mul- tipolarity without sufficient multilateralism is a dan- gerous trend. Without comprehensive change that includes the end of permanent seats and the veto, the Council is fading into irrelevance. Such reform is possible, but requires a very different approach compared to efforts to find a compromise between different negotiating blocks in New York. Instead, detailed proposals should be agreed upon amongst like-minded states outside of the intergovernmental negotiating process and tabled in the General Assembly as a non-negotiable amendment to the Charter of the United Nations (UN). Even then only the threat from key countries to withdraw coopera- tion from the UN is likely to change things.
Topic:
Security, International Cooperation, United Nations, Multilateralism, and UN Security Council
Political Geography:
Global Focus

216. Increasing International Cooperation in Cybersecurity and Adapting Cyber Norms

Author:
Elena Chernenko, Oleg Demidov, and Fyodor Lukyanov
Publication Date:
02-2018
Content Type:
Working Paper
Institution:
Council on Foreign Relations
Abstract:
nformation and communications technology (ICT) presents one of the most critical modern challenges to global security. Threat assessments predict that the next major international crisis could be due to a state or terrorist group weaponizing ICTs to devastate critical infrastructure or military logistics networks. The proliferation of asymmetric warfare (i.e., conflicts between nations or groups that have disparate military capabilities) has increased states’ use of ICTs, which necessitates the development of an international code of cyber conduct. There is an urgent need for cooperation among states to mitigate threats such as cybercrime, cyberattacks on critical infrastructure, electronic espionage, bulk data interception, and offensive operations intended to project power by the application of force in and through cyberspace. Emerging cyber threats could precipitate massive economic and societal damage, and international efforts need to be recalibrated to account for this new reality. A common misperception is that the principal cybersecurity threats demanding urgent international collaboration are massive, state sponsored attacks that target critical infrastructure such as power plants or electrical grids, causing massive devastation and human casualties. In fact, cyber threats are more diverse and complex, often targeting private enterprises and endangering the technical integrity of the digital world. The near-total digitalization of business models makes the global economy more vulnerable to cyberattacks, not only from states but also from criminal organizations and other nonstate actors.
Topic:
Security, International Cooperation, Infrastructure, and Cybersecurity
Political Geography:
Global Focus

217. Clearing the Path: Withdrawal of Consent and Termination as Next Steps for Reforming International Investment Law

Author:
Lise Johnson, Lisa Sachs, Brooke Güven, and Jesse Coleman
Publication Date:
04-2018
Content Type:
Working Paper
Institution:
Columbia Center on Sustainable Investment
Abstract:
This is a crucial moment in international investment policymaking. Two factors have converged, calling for a new direction. First, it has become increasingly difficult to justify investor-state dispute settlement (ISDS); even governments that had been among its strongest proponents are now changing course and have raised a range of fundamental, systemic and inter-related issues relating to ISDS. Second, policy makers and other stakeholders have a greater awareness of the need to design appropriate policies to maximize the contributions cross-border investment can make to sustainable development. Influenced by these factors, various reform efforts related to investment policy are underway at the national, regional, and international levels. These discussions about reform are likely to be slow, and outcomes uncertain. In the meantime, governments and their stakeholders remain tied to an outdated system that is widely acknowledged to be ill-suited for modern investment policy objectives, with increasingly concerning consequences. This policy paper explores two near-term options that governments engaged in reform discussions can pursue, alongside longer-term work on substantive and procedural reform. These options are: (1) a joint instrument on withdrawal of consent to arbitrate; and/or (2) a joint instrument on termination. The paper examines how both options could be implemented, and makes the case for putting a pause on ISDS to ensure that investment treaties and their dispute settlement mechanisms achieve their desired ends, produce legitimate decisions, and do not undermine international economic cooperation and sustainable development more broadly.
Topic:
International Cooperation, Regional Cooperation, Governance, Reform, Policy Implementation, and Investment
Political Geography:
Global Focus

218. Soft vs Hard Governance for Labour and Environmental Commitments in Trade Agreements: Comparing the US and EU Approaches

Author:
Vandana Gyanchandani
Publication Date:
08-2018
Content Type:
Working Paper
Institution:
Centre for Trade and Economic Integration, The Graduate Institute (IHEID)
Abstract:
Three methodologies are used to enforce labour and environmental commitments in the US and EU trade agreements: cooperative, sanctions and composite. In-depth analysis of the scope of commitments, level of protection, institutional framework as well as types of informal and formal dispute processes elucidates the pros and cons of such methodologies. Sanctions approach weakens cooperation by misjudging the complexity of domestic policy adjustments through transnational governance. Cooperative mechanism within the NAAEC's composite design emerges as the best approach: Submission on Enforcement Matters (SEM). As it provides for an independent secretariat supported by civil society group and factual records as a sunshine remedy to review citizen submissions. However, the process is constrained by political clout, lack of managerial capacity and legal dilemmas around informal lawmaking (IN-LAW) procedures.
Topic:
Economics, Environment, International Cooperation, International Trade and Finance, Labor Issues, Sustainable Development Goals, and Global Political Economy
Political Geography:
United States, Europe, Global Focus, and European Union

219. Social Audit in 20 Steps

Author:
Transparency International
Publication Date:
10-2018
Content Type:
Working Paper
Institution:
Transparency International
Abstract:
Social audit is a powerful social accountability tool. It has led to the conviction of public officials for violating the right to information law in Guatemala, a 50 per cent reduction in the costs of public construction works in Peru, and cancelling an illegal education fee in Ghana. Social audit scrutinises public officials’ decisions and/or actions, looking for administrative or financial irregularities. It seeks to uncover discrepancies by comparing public documents, processes or services with how they should be. It can take many names and forms, ranging from social audits in Guatemala and anti-corruption brigades in Peru, to social auditing clubs in Ghana. This report extracts lessons from the social audits implemented by Acción Ciudadana in Guatemala, Proética in Peru and Ghana Integrity Initiative in Ghana. The report examines the social audit outcome reports and other records shared by the three Transparency International chapters, and includes an extensive review of the wider literature on social audits. Based on these experiences, the report outlines 20 key steps to implement an effective social audit.
Topic:
International Cooperation and International Affairs
Political Geography:
Global Focus

220. European Gateway: Inside the Murky World of Golden Visas

Author:
Transparency International
Publication Date:
10-2018
Content Type:
Special Report
Institution:
Transparency International
Abstract:
Just like a luxury good, European Union (EU) citizenship and residency rights can be bought. There are many buyers, and there is no shortage of suppliers, which explains why investment migration is a growing, multibillion-euro industry. The rules of the game in this diverse market are shaped, on the one hand, by government officials who have effectively demonstrated their preference for quick gains over longer-term impacts, and, on the other hand, by profit-driven private sector players. However, the selling of passports and permits is not without risks. The response from the EU has been limited thus far, and Member States have been making use of their wide discretionary powers when it comes to issues of citizenship and residency.
Topic:
International Cooperation and International Affairs
Political Geography:
Global Focus