Search

17121. What Made the Financial Crisis Systemic?

Author:
Patric H. Hendershott and Kevin Villani
Publication Date:
03-2012
Content Type:
Working Paper
Institution:
The Cato Institute
Abstract:
The current narrative regarding the 2008 systemic financial system collapse is that numerous seemingly unrelated events occurred in unregulated or underregulated markets, requiring widespread bailouts of actors across the financial spectrum, from mortgage borrowers to investors in money market funds. The Financial Crisis Inquiry Commission, created by the U.S. Congress to investigate the causes of the crisis, promotes this politically convenient narrative, and the 2010 Dodd-Frank Act operationalizes it by completing the progressive extension of federal protection and regulation of banking and finance that began in the 1930s so that it now covers virtually all financial activities, including hedge funds and proprietary trading. The Dodd-Frank Act further charges the newly created Financial Stability Oversight Council, made up of politicians, bureaucrats, and university professors, with preventing a subsequent systemic crisis.
Topic:
Economics, Government, Markets, Global Recession, and Financial Crisis
Political Geography:
United States

17122. The Image of Crisis-Ridden Europe and the Division Between Creditor and Debtor Countries: The Case of Italy

Author:
Michele Comelli
Publication Date:
06-2012
Content Type:
Working Paper
Institution:
Istituto Affari Internazionali
Abstract:
The eurozone's debt crisis has exposed structural economic and political rifts within the European Union. Specifically, it has created a new cleavage between creditor and debtor countries, the former being mainly located in Central-Northern Europe and the latter in Southern Europe, each with its own understanding of the causes of and remedies to the crisis. This paper explores how a debtor country - Italy - has changed its political discourse on the EU as a result of the crisis, focusing on political elites, civil society and public opinion. It argues that while the discourse of political elites and of civil society clearly mirrors this cleavage, public opinion does not necessarily follow this pattern, being mainly concerned with the country's domestic ills.
Topic:
Civil Society, Debt, and Financial Crisis
Political Geography:
Europe and Italy

17123. Israel and the Palestinians After the Arab Spring: No Time for Peace

Author:
Andrea Dessì
Publication Date:
05-2012
Content Type:
Working Paper
Institution:
Istituto Affari Internazionali
Abstract:
While spared from internal turmoil, Israel and the Palestinian Territories have nonetheless been affected by the region's political transformation brought about by the Arab Spring. Reflecting what can be described as Israel's “bunker” mentality, the Israeli government has characterized the Arab revolutionary wave as a security challenge, notably given its concern about the rise of Islamist forces. Prime Minister Netanyahu has capitalized on this sense of insecurity to justify his government's lack of significant action when it comes to the peace process. On the Palestinian side, both Hamas and Fatah have lost long-standing regional backers in Egypt and Syria and have had to contend with their increasingly shaky popular legitimacy. This has spurred renewed efforts for reconciliation, which however have so far produced no significant results. Against this backdrop, the chances for a resumption of serious Israeli-Palestinian peace talks appear increasingly dim. An effort by the international community is needed to break the current deadlock and establish an atmosphere more conducive for talks. In this context, the EU carries special responsibility as the only external actor that still enjoys some credibility as a balanced mediator between the sides.
Topic:
Conflict Resolution, Political Violence, Treaties and Agreements, and Territorial Disputes
Political Geography:
Middle East, Israel, Palestine, Arabia, Syria, and Egypt

17124. The Somali Crisis: Failed State and International Interventions

Author:
Rossella Marangio
Publication Date:
05-2012
Content Type:
Working Paper
Institution:
Istituto Affari Internazionali
Abstract:
The long-lasting Somali conflict is profoundly linked to the country's historical development and its socio-cultural specificities. The political milieu and the struggle for power in Somalia reflect the cleavage between tradition and modernity. This rift has led to a legitimacy vacuum, which has made it difficult for the warring parties to find enough common ground for a compromise. Furthermore, external influences, at both regional and international levels, have contributed to the fragmentation of the political arena, due notably to the emphasis on the use of force as the principal tool for acquiring or maintaining power. In this unfolding crisis, regional pressures and rivalries, international interventions, economic and strategic interests as well as piracy, corruption and Islamic extremism all play an interlocking role. In view of this, a new approach to the crisis is badly needed. The EU, in particular, should promote a new strategy based on three components: enhancement of social cohesion through local cooperation programmes, state-building and development.
Topic:
Conflict Resolution, Political Violence, Islam, and Fragile/Failed State
Political Geography:
Africa, Europe, and Somalia

17125. The 2012 Armenian Parliamentary Elections: Implications for Armenian Foreign Policy

Author:
Marilisa Lorusso
Publication Date:
05-2012
Content Type:
Working Paper
Institution:
Istituto Affari Internazionali
Abstract:
Armenian parliamentary elections were held on 6 May 2012. Five parties and a coalition won seats in Parliament. Three of them are opposition parties, two in the previous legislature were allies of the presidency party, the Republican Party. The latter comfortably won the elections. With 45% votes through the proportional system and 29 seats through the majoritarian one, the Republican Party has the absolute majority of seats, 69 out of 131. So the two main issues in Armenian foreign policy - the protracted conflict with Azerbaijan over Nagorno-Karabakh and relations with Turkey - will be addressed in continuity with the policy expressed so far by President Serzh Sargsyan, unless the regional counterparts change their strategies. With the party he chairs being confirmed as the leading political force of the country, Sargsyan will run for his second term in the upcoming presidential elections.
Topic:
Democratization, Development, and Politics
Political Geography:
Turkey and Caucasus

17126. The trade-off between Innovation and Defence Industrial Policy

Author:
Fulvio Castellacci, Martin Blom, and Arne Martin Fevolden
Publication Date:
05-2012
Content Type:
Working Paper
Institution:
Norwegian Institute of International Affairs
Abstract:
The paper investigates the trade-off between innovation and defence industrial policy. It presents an agent-based simulation model calibrated for the Norwegian defence industry that compares different policy scenarios and examines the effects of a pending EU market liberalization process. The paper points to two main results. (1) It finds that a pure scenario where national authorities focus on, and provide support exclusively for, either a) international competitiveness or b) national defence and security objectives, is more Pareto efficient than a corresponding mixed strategy where policy makers simultaneously pursue both international competitiveness and defence and security objectives. (2) Under the conditions of the new EU liberalization regime, it finds that a stronger and more visible trade-off will emerge between international competitiveness and national defence and security objectives. Policy makers will have to choose which to prioritise, and set a clear agenda focusing on one of the two objectives.international competitiveness or b) national defence and security objectives, is more Pareto efficient than a corresponding mixed strategy where policy makers simultaneously pursue both international competitiveness and defence and security objectives. (2) Under the conditions of the new EU liberalization regime, it finds that a stronger and more visible trade-off will emerge between international competitiveness and national defence and security objectives. Policy makers will have to choose which to prioritise, and set a clear agenda focusing on one of the two objectives.
Topic:
Security, Defense Policy, International Trade and Finance, and Markets
Political Geography:
Europe

17127. International Patenting

Author:
Per Botolf Maurseth and Roger Svensson
Publication Date:
04-2012
Content Type:
Working Paper
Institution:
Norwegian Institute of International Affairs
Abstract:
International patenting is increasing in importance. Patents protection is sought in the inventors' homeland but increasingly also in other countries. Globalization, high growth rates in high-tech industries, growing emerging markets and harmonization of patent institutions across countries have stimulated increased international patenting. We use a simple model of international patenting developed by Eaton and Kortum(1996) where the decision to patent in a country depends on country characteristics and the quality of the patented invention. With access to a unique database on Swedish firms' patents and patent behavior we are able to estimate some of these relations and test their validity. Our results indicate that the propensity to apply for international patent protection increases with indicators of the value of the invention and indictors of technological rivalry and market size in the markets where patent applications are submitted.
Topic:
Globalization, International Law, International Trade and Finance, Markets, and Intellectual Property/Copyright

17128. Innovation, Absorptive Capacity and Complexity along Development Stages

Author:
Fulvio Castellacci and Jose Miguel Natera
Publication Date:
04-2012
Content Type:
Working Paper
Institution:
Norwegian Institute of International Affairs
Abstract:
The paper presents an empirical analysis of the time series properties of Schumpeterian multiple equilibria models. It considers a panel of 116 countries over the period 1980-2008, and makes use of panel cointegration analysis and Granger causality tests to identify the set of dynamic relationships linking together innovation, absorptive capacity and economic growth in different country clubs. The results provide general support for this class of models and show that absorptive capacity and innovation progressively become more important engines of growth as the development process unfolds over time. Relatedly, the complexity of the economic system (measured by the number of significant Granger causal relationships driving economic growth) increases as we move from the less-developed, to the middle-income and then to the advanced country clubs.
Topic:
Development, Economics, International Cooperation, and Political Economy

17129. The War on Terror from Bush to Obama: On Power and Path Dependency

Author:
Hilde Eliassen Restad
Publication Date:
04-2012
Content Type:
Working Paper
Institution:
Norwegian Institute of International Affairs
Abstract:
James Madison famously stated in 1793: “War is in fact the true nurse of executive aggrandizement.” By this, Madison meant that, when confronted with a grave threat to national security, the instinct of a state is to concentrate power at the very top. This can lead – and has led – to abuse of power. For instance, President Franklin D. Roosevelt's signing of Executive Order 9066 on February 19, 1942 resulted in the forcible internment of Japanese Americans (two thirds of whom were U.S. citizens), an episode widely seen as regrettable later, after history had removed Americans from the anxiety of war. But by no means do we have to look as far back as to World War II. We can note Cold War incidents such as the Iran-Contra scandal (1985–87), when the Reagan administration took it upon itself to bypass Congress – and specific laws – in order to support the controversial Nicaraguan Contras with money acquired by selling arms to Iran.
Topic:
Foreign Policy, Defense Policy, Government, Terrorism, and Counterinsurgency
Political Geography:
United States and Iran

17130. The ABC of the Arms Trade Treaty: Why it's important–“ How will it work?

Publication Date:
06-2012
Content Type:
Policy Brief
Institution:
Oxfam Publishing
Abstract:
The Arms Trade Treaty is a potential ground-breaking humanitarian treaty that would regulate the international trade in conventional weapons. The Treaty will be negotiated at a United Nations conference in New York Between July 2-27. There is currently no effective international legislation on the global arms trade. While there are treaties on nuclear, chemical and biological weapons there is nothing on the weapons that kill people every day. Patchy, diverse and often completely absent, national regulations are inadequate with the increasingly globalized nature of the arms trade. Arms companies, operating from an increasing number of locations, now source components from across the world. Their products are often assembled in countries with lax controls on where they end up, hence the need for truly global rules which reflect the nature of the trade.
Topic:
Arms Control and Proliferation, Globalization, Markets, Nuclear Weapons, United Nations, and Weapons of Mass Destruction
Political Geography:
New York