The ‘real’ explanation of the PPP puzzle

This article shows that global financial markets cannot, by themselves, achieve net transfers of financial capital and real interest rate equalization across countries and that the integration of both global financial markets and global goods markets is needed to achieve net transfers of capital and real interest rate equalization across countries. Thus, frictions (barriers to mobility) in one or both of these markets can impede the net transfer of capital between countries, produce the Feldstein and Horioka (1980) finding of high-saving-investment correlations and prevent real interest rates from being equalized across countries. Moreover, frictions in global goods markets can explain why real exchange rates deviate from purchasing power parity (PPP) for extended periods of time and can therefore also explain the PPP puzzle. Consequently, we are able to resolve two of Obstfeld and Rogoff’s (2000) ‘6 major puzzles in macroeconomics’ with essentially the same explanation.     

The impact of health insurance on households’ financial choices: Evidence from Vietnam

This paper investigates the impact of health insurance on families' financial service choices in Vietnam using TVSEP data from three waves in 2013, 2016, and 2017. The endogeneity is handled via a recursive multivariate probit model. The findings indicate that while health insurance has no effect on private health insurance, it has a positive effect on savings and investments and a negative effect on credit choice. The multivariate probit model's results are robust to both the instrumental variable two-stage least squares model and the bivariate probit model. In addition, correlations between error components in financial service choice equations indicate a possible pattern of household financial usage. The results suggest that health insurance improves households' financial well-being. The implication of the findings is that when developing social security policies aimed at achieving universal health insurance, the influence of health insurance on household finances should not be underestimated.     

The ‘Twin Peaks’ model of post-crisis banking supervision

This article examines the effectiveness of the ‘Twin Peaks’ supervision model, in which consumer protection and prudential regulation are carried out by two separate regulatory agencies. We use a dataset from 143 countries for the period of 2004–2011 to find that the Twin Peaks model is associated with a higher quality of banking supervision in terms of the efficiency and stability of financial institutions.     

The Making of New ‘Space’: Cases of Transatlantic Astropolitics

This article investigates geopolitical interactions between Europe and the United States (US) in large-scale outer space application programmes, which I term transatlantic astropolitics. Europe and the US have transcended tangible geographical constraints on terrestrial territories and extended geopolitics to outer space with advanced technologies, thereby making outer space a new ‘space’ for transatlantic interaction. Transatlantic astropolitics reveals an instrumental rationality that both sides pursue interests with respective cost-effective calculation rather than shared norms, common culture, or collective identities. This phenomenon indicates an inconsistency between the discourse of transatlantic security community and practices of European and US individual geopolitical interest satisfaction. This article provides a coupling between theories of international relations (IR) and political geography in outer space issue area, and thereby identifies the role geopolitical thoughts play in transatlantic astropolitics. This article concludes with the validity of neo-classical astropolitics in explaining outer space activities, and cost-efficient calculation as the cause of strategic variation in transatlantic astropolitics.     

The political economy of decarbonisation: from green energy ‘race’ to green ‘division of labour’

This paper aims to provide an addendum to the rapidly growing concept of a global ‘green energy race’ between major states. It argues that although this framing has been useful in underscoring important dynamics in the process of decarbonisation, its narrow focus on installed capacity obscures a much broader and more complex process at play. In particular, it overlooks the critical role played by states aggressively investing in R&D and export manufacturing in the renewable energy sector. The paper thus supplements the concept of a green ‘energy race’ with that of a green ‘global division of labour’, which sees the process of decarbonisation not exclusively as an effort by individual states to install renewables domestically, but rather as a collective and interdependent process by dozens of states, all striving in different ways to promote capital accumulation on their soil. The paper provides an overview of data covering innovation, manufacturing and deployment in the clean energy sector, and offers a theoretical analysis of the trends observed.     

The ‘Value’ of Europe: The Political Economy of Culture in the European Community

During the 1970s and 1980s the “cultural sector” became one of the primary motors for wealth creation in the European Community. At the European and national scales, a group of actors helped transform Europe's vast array of practices and services (tourism, heritage, books, audio-visual products, etc.) into “cultural industries” and pushed the EC to develop a common cultural policy to support these industries. Documenting these changes at the European scale, I argue that the perceived impact of cultural policy for particular national economic competitiveness was also significant. Italian MEPs and members of Italy's national government were especially important, as they fought to protect the country's historical heritage and promote tourism. France pushed the strongest and I show how that country's efforts were primarily intended to protect its audio-visual and publishing industries from the EC internal market's liberalisation policies, which were vocally supported by Britain because they would have served that county's national economic interests.     

Richard Kahn's fellowship dissertation: The fate of ‘The Economics of the Short Period’

Abstract

In 1930, Richard Kahn became a fellow of King's College, Cambridge, on the basis of his book-length dissertation ‘The Economics of the Short Period.’ It was finally published in the 1980s. Why did he not publish his thesis in the 1930s, when it would have made a substantial impact? We present two arguments. In 1932/33, Joan Robinson published many of Kahn's main ideas, rendering subsequent publication by him derivative. And by the mid-1930s, Kahn discovered that parts of his dissertation left untouched by Robinson were no longer new or distinctive because of rapid progress in research on imperfect and monopolistic competition.     

A Critique of ‘Neoliberal Autonomy’: The Rhetoric of Ownership Society

The rhetoric of the Ownership Society defined by the Cato Institute has been integral to framing the motivation behind the Social Security reform introduced by George W. Bush. This motivational frame involves a fierce advocacy of what we will call ‘neoliberal autonomy’ in a Hayekian and Friedmanite sense. For Hayek and Friedman, the social adequacy component of Social Security is problematized in the name of self-reliance and individual choice, which rejects any authoritative standards as morally indefensible. Nevertheless, the rhetoric of the Ownership Society, though it glorifies the neoliberal notion of autonomy, does not explicitly question the moral basis of Social Security. Rather, by defining the terms of debate, it frames the meaning of Social Security along neoliberal lines in an attempt to make a supposedly detached economic case for private retirement accounts. In this ‘pro-privatization’ framework, the social adequacy component of the Social Security system fades away as individual equity, or actuarial fairness, comes to the fore as the chief theme. We suggest a ‘pro-social’ rhetoric that recognizes the pursuit of social standards as providing the element of autonomy.     

The ‘real’ explanation of the Feldstein–Horioka puzzle

This article shows that global capital markets cannot, by themselves, achieve net transfers of financial capital between countries and that both the integration of global financial markets and the integration of global goods markets are needed to achieve net transfers of capital between countries. Frictions (barriers to mobility) in one or both of these markets can impede net transfers of capital between countries, produce the Feldstein and Horioka (1980) results and prevent real interest rates from being equalized across countries. Moreover, there is empirical evidence that barriers to the mobility of goods and services are an important obstacle to international capital mobility.     

The Demise of ‘International Relations’: America's Western Palimpsest

By the end of the nineteenth century, the map of the U.S. no longer revealed the historic encounter of nationhoods between Euro- and Native Americans. The changes in the map articulated the process though which what had been foreign policy on the continent had been displaced by various version of racial politics. Two films are the book ends of this analysis, whose middle section treats the way classis westerns, particularly those directed by John Ford, supply insights into the Euro American geo- and biopolitical “ethnogenesis,” their ethnically privileged and territorially pervasive presence on the North American continent. I begin with Sean Penn's The Pledge (2001) and conclude with Wim Wenders's Paris, Texas (1984). While it is unlikely that the “international relations” that characterized the American continent will be restored, these two films (and other genres of popular culture) remind us of the politics of America's cartographic history.     

‘My Own Utopia’. The economics of Bentham's Panopticon

The paper analyses Bentham's theory of the economic management of the Panopticon prison he projected in 1786 and which was approved by the British Parliament in 1794, but never constructed. Its focus is on the economic arguments employed to justify the principles of management, most of which amount to the modern economic notions of market policies and principal-agent relationships. Bentham's way of conceiving these notions can be summarized in the problem of the junction of interest and duty. This paper shows that many modern notions concerning the economics of organizations and public economics are clearly foreshadowed, and sometimes even explicitly formulated, in Bentham's writings on prison management. Bentham was conscious of the important economic dimension of the Panopticon scheme and was persuaded, albeit illusorily, that an accurate economic theory of its management could favour its approval. Well before Charles Babbage's On the Economy of Machinery and Manufactures (), he went into a detailed theoretical analysis of the requirements and dilemmas of a complex economic organization oriented towards the joint fulfilment of the goals of a variety of stakeholders: taxpayers, the government, contract managers, keepers, taskmasters, subcontractors and prisoners. He also recognized that some institutional limits must be opposed to profit-oriented management in order to preserve the life, health and mental equilibrium of subordinates.     

A Critique of ‘Neoliberal Autonomy’: The Rhetoric of Ownership Society

The rhetoric of the Ownership Society defined by the Cato Institute has been integral to framing the motivation behind the Social Security reform introduced by George W. Bush. This motivational frame involves a fierce advocacy of what we will call ‘neoliberal autonomy’ in a Hayekian and Friedmanite sense. For Hayek and Friedman, the social adequacy component of Social Security is problematized in the name of self-reliance and individual choice, which rejects any authoritative standards as morally indefensible. Nevertheless, the rhetoric of the Ownership Society, though it glorifies the neoliberal notion of autonomy, does not explicitly question the moral basis of Social Security. Rather, by defining the terms of debate, it frames the meaning of Social Security along neoliberal lines in an attempt to make a supposedly detached economic case for private retirement accounts. In this ‘pro-privatization’ framework, the social adequacy component of the Social Security system fades away as individual equity, or actuarial fairness, comes to the fore as the chief theme. We suggest a ‘pro-social’ rhetoric that recognizes the pursuit of social standards as providing the element of autonomy.

The ‘West’ against the ‘Rest’: Geopolitics after the end of the cold war

With the end of the Cold War, it seemed that we had reached the ‘end of geopolitics’. Since the mid‐1990s, however, the term ‘geopolitics’ has experienced a revival, and even regional groupings which have so far abstained from any kind of power politics, such as the European Union, have started to claim geopolitical interests for themselves. But it is not clear what constitutes this kind of power politics in the 1990s and what drives ‘the West’ to pursue geopolitics, directed against what Huntington has labelled so plainly and provocatively the ‘Rest’. The article addresses this question by analysing Western capital's need for access to markets in the South and the EU's and US’ growing dependence on oil imports. The article will argue that a Western geostrategy based on Huntington's civilisational model would be counterproductive in the long run, manoeuvring the Western states into a situation where these geopolitical goals would have to be enforced by military means instead of being pursued through a strategy of political and economic support.     

Geopolitica: The ‘Geographical and Imperial Consciousness’ of Fascist Italy

Very few contributions have been published in English on the Italian geopolitical tradition of the interwar years. This is rather surprising, given the fact that, after Geopolitik, Italian geopolitics was one of the largest and most significant in Europe. This article aims to fill this void, by offering a detailed and critical investigation into this intellectual production. Although the article traces the origins of Italian geopolitics back to the 1920s, its main focus is on Geopolitica (1939–1942), the journal which, more than any others, embodied the attempts to give Italy its own geopolitics. Despite its ambitious proposal to become the ‘imperial-geographical consciousness’ of the Fascist regime, Geopolitica remained largely confined within the circle of academic geography and ultimately also failed to influence the development of Italian geographical tradition.