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52. Transcending History’s Heavy Hand The Future in Economic Action
- Author:
- Jens Beckert and Timur Ergen
- Publication Date:
- 03-2020
- Content Type:
- Working Paper
- Institution:
- Max Planck Institute for the Study of Societies
- Abstract:
- This paper discusses sociological analyses of the formation and role of expectations in the economy. Recognition of the social constitution of expectations advances the understand- ing of economic action under conditions of uncertainty and helps to explain core features of modern capitalist societies. The range of applications of the analytical perspective is il- lustrated by closer examination of three core spheres of capitalist societies: consumption, investment, and innovation. To provide an idea of core challenges of the approach, three major research questions for the sociological analysis of expectations are presented.
- Topic:
- Economics, Markets, Sociology, Capitalism, and Innovation
- Political Geography:
- Global Focus
53. World Oil Security on a Precipice
- Author:
- Charles F. Doran
- Publication Date:
- 03-2020
- Content Type:
- Journal Article
- Journal:
- Brown Journal of World Affairs
- Institution:
- Brown Journal of World Affairs
- Abstract:
- By attacking a major Saudi oil facility at Abqaiq on 13 September 2019, Iran established a new norm regarding oil security. Now, no oil field, pipeline, refinery, supertanker, or port facility is free from internecine warfare between oil-producing (OPEC) governments. Ironically, in attempting to defend a coun- try from supply interruption, the United States risks worsening the magnitude and scope of that supply interruption rather than preventing its occurrence. In the era of highly accurate drones and missiles, the old oil field motto “all oil comes from a single barrel” has taken on a newly negative connotation. World oil stability rests on a precipice. Both exporters and importers suffer from supply interruption, although perhaps not equally, universally, or simultaneously. Supply interruption may benefit those who have oil to sell through resultant oil price increases if their own exports have not been interrupted. The same cannot be said for buyers who, unless they are energy speculators on the futures market, ardently want to prevent supply interruption and the virtually certain subsequent (though sometimes not lasting) increase in price.
- Topic:
- Security, Markets, Oil, and Energy
- Political Geography:
- Global Focus and Gulf Nations
54. Transcending History’s Heavy Hand: The Future in Economic Action
- Author:
- Jens Beckert and Timur Ergen
- Publication Date:
- 03-2020
- Content Type:
- Working Paper
- Institution:
- Max Planck Sciences Po Center on Coping with Instability in Market Societies (MaxPo)
- Abstract:
- This paper discusses sociological analyses of the formation and role of expectations in the economy. Recognition of the social constitution of expectations advances the understanding of economic action under conditions of uncertainty and helps to explain core features of modern capitalist societies. The range of applications of the analytical perspective is illustrated by closer examination of three core spheres of capitalist societies: consumption, investment, and innovation. To provide an idea of core challenges of the approach, three major research questions for the sociological analysis of expectations are presented.
- Topic:
- Markets, Innovation, Social Change, Economic Sociology, Expectations, and Firms
- Political Geography:
- Global Focus
55. Making Basel III Work for Emerging Markets and Developing Economies
- Author:
- Thorsten Beck and Liliana Rojas-Suarez
- Publication Date:
- 04-2019
- Content Type:
- Working Paper
- Institution:
- Center for Global Development (CGD)
- Abstract:
- A sound financial regulatory framework is critical for minimizing the risk imposed by financial system fragility. In the world’s emerging markets and developing economies (EMDEs), such regulation is also essential to support economic development and poverty reduction. Meanwhile, it is increasingly recognized that global financial stability is a global public good: recent decades have seen the development of new international financial regulatory standards, to serve as benchmarks for gauging regulation across countries, facilitate cooperation among financial supervisors from different countries, and create a level playing field for financial institutions wherever they operate. For the worldwide banking industry, the international regulatory standards promulgated by the Basel Committee on Banking Supervision (BCBS) stand out for their wide-ranging scope and detail. Even though the latest Basel recommendations, adopted in late 2017 and known as Basel III, are, like their predecessors, calibrated primarily for advanced countries, many EMDEs are in the process of adopting and adapting them, and many others are considering it. They do so because they see it as in their long-term interest, but at the same time the new standards pose for them new risks and challenges. This report assesses the implications of Basel III for EMDEs and provides recommendations for both international and local policymakers to make Basel III work for these economies.
- Topic:
- Development, Economics, Emerging Markets, and Markets
- Political Geography:
- Global Focus
56. Exchange Rate Flexibility, Financial Market Openness and Economic Growth
- Author:
- Il Houng Lee, Eunjung Kang, and Kyunghun Kim
- Publication Date:
- 04-2019
- Content Type:
- Working Paper
- Institution:
- Korea Institute for International Economic Policy (KIEP)
- Abstract:
- With global recovery not in sight, along with calls for stronger structural reform, international policy coordination is again under spotlight. Correcting global imbalance would contribute towards closing the demand gap. Emerging economies in particular should allow greater exchange rate flexibility and not intervene in the foreign exchange market to reflect fundamentals. Yet, the impact of greater exchange rate flexibility is unclear as they also struggle to keep their growth momentum alive and hedge against greater exposure to potential capital reversal than ever before. With the loss of monetary policy independence, emerging markets (EMs) are running out of policy options. Against this background, unless international policy coordination is fundamentally recast, a comprehensive review of all emerging market economies’ policy options are in order, including both macro policy instruments, micro measures, and global safety net aimed at attaining the best possible solution to escaping global recession.
- Topic:
- Markets, Finance, Economic Growth, and Exchange Rate Policy
- Political Geography:
- Global Focus
57. Do Patents Lead to Market Concentration and Excess Profits?
- Author:
- Padmashree Gehl Sampath and Walter Park
- Publication Date:
- 04-2019
- Content Type:
- Working Paper
- Institution:
- Global Development and Environment Institute at Tufts University
- Abstract:
- Market concentration in technology intensive industries has been a subject of interest to both scholars and policy analysts. This paper provides a first empirical assessment on how the patenting system contributes to market concentration and the generation of economic rents in three key sectors – pharmaceuticals, chemicals and ICTs. Using data for US multinationals and their foreign affiliates on the one hand, and locally registered private and public companies in Brazil, India and China, we conclude that the concentration of patent ownership is found significantly to relate to market concentration in the USA. In developing countries such as Brazil, India, and China, a strengthening of patent rights has contributed to greater returns for affiliates of U.S. companies but has not stimulated their R&D intensity. The affiliates of U.S. multinationals have enjoyed greater profitability relative to their local competitors in Brazil, India, and China. The paper draws implications for the setting of intellectual property policy and offers suggestions on the role of competition policy in curbing market concentration and related effects on inequality and access.
- Topic:
- Markets, Inequality, and Patents
- Political Geography:
- Global Focus
58. Lessons Learned and Evolving Practices of the TIBER Framework for Resilience Testing in the Netherlands
- Author:
- Petra Hielkema and Raymond Kleijmeer
- Publication Date:
- 10-2019
- Content Type:
- Working Paper
- Institution:
- Carnegie Endowment for International Peace
- Abstract:
- Financial institutions face an evolving threat landscape with a wide range of hostile actors targeting them. Regulators and consumers reasonably expect the institutions to make themselves more secure. The question then emerges as to whether financial institutions are complying with the different standards, rules, and regulations regarding their security. International standard-setting bodies have recognized the need to raise the bar higher for the resilience of financial institutions. The publication of the Committee on Payments and Market Infrastructures-International Organization of Securities Commissions (CPMI-IOSCO) guidance on cyber resilience in June 2016 has been pivotal in emphasizing the need to have an integrated approach for financial market infrastructures, with the institution’s board being ultimately responsible and accountable for cyber resilience.1 Increasingly, authorities and financial institutions alike recognize that, in addition to assessing the overall resilience posture of a financial institution against sophisticated attacks, it will be important to actually test this posture. The CPMI-IOSCO guidance includes a chapter dedicated to testing, containing several examples of activities to that end. Recently, frameworks for testing the resilience posture of institutions in practice have been developed internationally.
- Topic:
- Markets, Science and Technology, Finance, and Resilience
- Political Geography:
- Europe, Netherlands, and Global Focus
59. Smart Development Banks
- Author:
- Eduardo Fernández-Arias, Ricardo Hausmann, and Ugo Panizza
- Publication Date:
- 04-2019
- Content Type:
- Working Paper
- Institution:
- The John F. Kennedy School of Government at Harvard University
- Abstract:
- The conventional paradigm about development banks is that these institutions exist to target well-identified market failures. However, market failures are not directly observable and can only be ascertained with a suitable learning process. Hence, the question is how do the policymakers know what activities should be promoted, how do they learn about the obstacles to the creation of new activities? Rather than assuming that the government has arrived at the right list of market failures and uses development banks to close some well-identified market gaps, we suggest that development banks can be in charge of identifying these market failures through their loan-screening and lending activities to guide their operations and provide critical inputs for the design of productive development policies. In fact, they can also identify government failures that stand in the way of development and call for needed public inputs. This intelligence role of development banks is similar to the role that modern theories of financial intermediation assign to banks as institutions with a comparative advantage in producing and processing information. However, while private banks focus on information on private returns, development banks would potentially produce and organize information about social returns.
- Topic:
- Development, Industrial Policy, Markets, and Banks
- Political Geography:
- Global Focus and Global Markets
60. Should We Worry About Corporate Leverage?
- Author:
- Şebnem Kalemli-Özcan
- Publication Date:
- 10-2019
- Content Type:
- Policy Brief
- Institution:
- Economics for Inclusive Prosperity (EfIP)
- Abstract:
- There has been a large increase in corporate leverage in many countries since the early 2000s. Figure 1 plots corporate debt to GDP since 2002 for different groups of countries. With the exception of the U.S., both advanced economies and emerging markets have corporate debt exceeding GDP since 2005. U.S. corporate debt is also on an increasing trend. The fastest growth in corporate debt has been observed in emerging markets. A closer look will reveal that China and other fast growing emerging countries in Asia drive most of the increase in corporate debt for the emerging markets.
- Topic:
- Debt, Economics, Markets, Regulation, Multinational Corporations, and Economic Policy
- Political Geography:
- United States and Global Focus