Foreign influence and welfare

How do foreign interests influence policy? How are trade policies and the viability of trade agreements affected? What are the welfare implications of such foreign influence? In this paper we develop a model of foreign influence and apply it to the study of optimal tariffs. In a two-country voting model of electoral competition, we allow the incumbent party in each country to take costly actions that probabilistically affect the electoral outcome in the other country. We show that policies end up maximizing a weighted sum of domestic and foreign welfare. Using this formulation we show that foreign influence increases aggregate world welfare when there are no other means of alleviating the externalities that arise from cross-border effects of policies. In contrast, when countries can engage in international agreements, foreign influence can prove harmful as powerful countries may refuse to offer concessions. We also show that power imbalances are particularly detrimental to cooperation when they are positively correlated with economic size.     

The end of financial services liberalisation as we know it

At the intersection of trade policy and finance a new field of international economic policy has emerged, which has so far received little academic attention. Since the early 1990s, financial services have become an object of modern trade policy for the first time. How are the contours of the new trade policy for the financial services defined? Which research issues are posed by this new field?     

Free trade as ideology: fair trade as goal problems of an ideological approach in U.S. trade policy

Increased protectionist practices among the major industrialized countries present serious challenges to a free trade doctrine. Contradictions between theory and practice make the defense of a pure trade system increasingly untenable. Yet U.S. trade policy continues to be driven by an ideological commitment to such a system. Changing international economic and political conditions suggest that a new “fair trade” paradigm may be in the making. However, replacement of a “free” trade regime by a “fair” one will depend on how well the weaknesses of a free trade ideology can be overcome. These weaknesses are discussed and some suggestions are offered for clarifying policy thinking about free trade under contemporary conditions.     

Strong economic upturn in Germany

A strong economic upturn has developed in Germany. But are there disparities between eastern and western Germany? What developments have there been in foreign trade and monetary policy? Are stimuli from fiscal policy to be expected? How good are the prospects for the year ahead?     

Exports From a Remote Developed Region: Analysed by an Inverse Hyperbolic Sine Transformation of the Gravity Model

Picture a small open economy, alone in the middle of the Atlantic Ocean and highly dependent on trade with NAFTA and the EU. How important are these trading blocs to the country’s exports? How significant is the country’s isolation and small size, and how do these affect the export sectors? Typically, the export volume is significantly impacted by the economic size of the exporting country, but in this case it is not. This suggests that the exports from small remote economies are driven by different factors than exports from large economies. The data are analysed using a unique transformation of the gravity model by an inverse hyperbolic sine function, allowing for accountancy of scattered exports.     

The Trade Policy Jungle: A Survival Guide for Academic Economists

The rules of the trade policy arena differ from those in academia. How can an economic researcher survive, let alone thrive, in what may appear to be a trade policy jungle? The purpose of this paper is not just to offer guidance in this respect but also to think through the factors that determine the supply and demand for timely, relevant, policy‐relevant insights into commercial policy matters. Understanding the latter provides much of the rationale for the former. Advice follows analysis, as it should do. Economic researchers have certain advantages that they can make immediate use of in the jungle and some baggage that they would do well to shed.     

Purchase power: An examination of consumption as voting

Abstract

There has been a reported increase in political activity through the marketplace in the form of ‘consumer votes’. The use of marketplace votes by consumers to address their concerns about societal issues is a phenomenon that has growing relevance for firms, since they are often affected by such consumer citizenship. Therefore, this paper aims to enhance our conceptual understanding of the consumer voting phenomenon. It explores marketplace power relations and the constraints and enabling mechanisms they may pose to consumers seeking change through consumer voting. Consumer voting practices, consumer sovereignty discourses, and power tensions in marketplace encounters are examined in relation to Foucault's notions of power, technologies of the self, and governmentality. Foucault provides a critical lens to illuminate the potential for consumer resistance, an approach that so far has been somewhat neglected by the extant marketing and consumer research literature.     

Preference Intensities and Majority Decisions Based on Difference of Support Between Alternatives

Simple majority is one of the most used decision rules in practice. However, under this decision rule, an alternative can defeat another one with very poor support. For this reason, other decision rules have been considered in the literature, such as qualified and special majorities as well as other majorities based on difference of votes. In this paper we generalize the latter mentioned voting systems by considering individual intensities of preference, and we provide some axiomatic characterizations.     

Policymakers' horizon and trade reforms: The protectionist effect of elections

This paper shows that electoral incentives deter politicians from supporting trade liberalization. We focus on all major trade liberalization bills introduced since the early 1970s in the U.S. Congress, in which House and Senate members serve respectively two- and six-year terms and one third of senators face elections every two years. We show that senators are more likely to support trade liberalization than House representatives. However, this result does not hold for the last generation of senators, who face elections at the same time as House members, suggesting that inter-cameral differences are driven by term length. Considering senators alone, we find that the last generation is less likely to support trade liberalization than the previous two. This result is pervasive and holds both when comparing the behavior of different senators voting on the same bill and that of individual senators voting on different bills. The protectionist effect of election proximity disappears for senators who are retiring or hold safe seats.     

The Third Vote Experiment: Enhancing Policy Representation of a Student Parliament

Since voters are often swayed more by the personal image of politicians than by party manifestos, they may cast votes that are in opposition to their policy preferences. This results in the election of representatives who do not correspond exactly to the voters’ own views. An alternative voting procedure to avoid this type of election failure is prompted by the approach implemented in internet voting advice applications, like the German Wahl-O-Mat, which asks the user a number of questions on topical policy issues; the computer program, drawing on all the parties’ answers, finds for the user the best-matching party, the second-best-matching party, etc. Under the proposed alternative election method, the voters cast no direct votes. Rather, they are asked about their preferences on the policy issues as declared in the party manifestos (Introduce nationwide minimum wage? Yes/No; Introduce a speed limit on the motorways? Yes/No, etc.), which reveals the balance of public opinion on each issue. These embedded referenda measure the degree to which the parties’ policies match the preferences of the electorate. The parliament seats are then distributed among the parties in proportion to their indices of popularity (the average percentage of the population represented on all the issues) and universality (frequency in representing a majority). This paper reports on an experimental application of this method during the election of the Karlsruhe Institute of Technology Student Parliament on July 4–8, 2016. The experiment shows that the alternative election method can increase the representativeness of the Student Parliament. We also discuss some traits and bottlenecks of the method that should be taken into account when preparing elections.     

An Election Method to Improve Policy Representation of a Parliament

Since voters are often swayed more by the charisma, personal image and communication skills of the individual candidates standing for election than by the parties’ political manifestos, they may cast votes that are actually in opposition to their policy preferences. Such a type of behavior, known as ‘irrational voting’, results in the election of representatives who do not correspond exactly to the voters’ own views. The example of the 2013 German Bundestag shows that the method used to elect it results in inadequate policy representation. The analysis of these elections (see, Tangian, 2016) led to an alternative method which is discussed in this paper. In the alternative method the voters’ policy preferences are taken into account explicitly by means of embedded referenda, testing the matching of the candidates’ policy profiles with that of the electorate. Then the parties are indexed, not with respect to the percentage of votes received but with respect to their representativeness indices of popularity (the average percentage of the population represented) and universality (frequency in representing a majority), as introduced in the previous paper mentioned. The method is then hypothetically applied to redistribute the Bundestag seats among the party factions, producing a considerable gain in the representativeness of the Bundestag. Finally, we discuss mixed election procedures combining the elements of traditional voting schemes with the proposed method.     

农产品不公平贸易政府行为的市场动力及耦合机制研究

由于一些国家经常采取各种手段,实施不公平竞争,导致了农产品贸易摩擦的频繁发生:一方面,任何农业贸易政策都是政治市场均衡的结果。发达国家的政府为获得农业利益集团的政治支持,倾向于采取贸易保护政策。另一方面,农业目标必须与其他行业目标保持平衡,同时,农业贸易政策目标也是多元化的,存在各目标彼此协调的问题。在不确定性环境中,农业政策的形成具有连续性和惯性。     

中美贸易收支与人民币汇率关系

本文基于1994~2005年的年度数据,通过协整分析和Granger因果检验发现,人民币汇率升值对中美贸易收支从长期看有一定影响,但不是中美贸易收支失衡的主要原因,美国经济发展状况以及国内政策才是导致中美贸易收支顺差的主要原因。在当前经济形势下,中美贸易顺差依然是我国经济发展的重要引擎之一。所以,我们一方面要警惕美国经济下滑导致我国的出口下降,另一方面可以利用人民币当前小幅上涨的契机,调整我国经济结构,加快产业升级的步伐。     

China and Globalisation

Since the initiation of economic reforms in 1978 China has become one of the world’s fastest growing economies and has emerged as a global economic and trade power. What are the implications for the world economy, in particular for the distribution of income and wealth? How will China contribute to shaping not only the globalised world economy but also the institutions and policies of global governance?The authors wish to thank the participants of the international seminar in Shanghai on 18-20 March 2005 for their valuable contributions, which have been incorporated into this paper.     

Welche Abstimmungsmuster liegen dem Brexit-Referendum zugrunde?

The Brexit referendum of 23 June 2016 is a key moment in British post war political history. This article describes the voting outcome and analyses the underlying explanatory factors. The vote was only weakly related to EU trade and economic policy. Instead, concerns about immigration seemed more important, in particular in areas that are characterised by low levels of immigration. Dissatisfaction with general economic circumstances and poor public service provision also played an important role.     

Economic Roots of Political Conflict: The Case of Sri Lanka

The escalation of political conflicts in many developing countries and their impact on economic development have been topical issues in recent development literature. The overwhelming emphasis on ‘ethnic conflicts’ in the literature has, however, precluded analysts from looking at political conflicts beyond their ethnic dimension, in the wider context of the development process. In particular, because of the preoccupation with ethnic roots as the prime source of these conflicts, reverse causation, running from economic policy to political conflict, has been virtually ignored in the debate. The purpose of this paper is to fill this gap through an in‐depth case study of the ‘twin political conflict’ in Sri Lanka – the Tamil separatist war in the North and the Sinhala youth uprising in the South – with emphasis on its economic roots. The findings suggest that fundamental contradictions in the national development policy in the restrictive trade regime of Sri Lanka were at the heart of the country's twin political conflict.     

Regional bloc formation and world trade

The grouping together of neighbouring countries to form free trade areas or economic and monetary unions currently constitutes a phenomenon occurring in all regions around the world. How far has the bloc-building process progressed? How will the development of world trade be affected by this process during the 1990s? How can companies respond to the developments in the global marketplace?     

Russia’s foreign trade and the economic reforms

The Russian Federation now faces a totally new beginning as regards the shaping of its foreign trade relations. The demands made upon its external economic policy by the changes in the political and economic systems on the one hand and the collapse of the formerly unified economic zone of the Soviet Union on the other are so great that, in many respects, consistent answers have yet to be found. To what extent has the Russian government so far succeeded in developing a new foreign trade regime?     

论反垄断法与贸易政策的互动关系

反垄断法与贸易政策是国际市场活动中被广泛运用的两个有效工具。如何发挥这两个工具的积极作用,实现国际市场的自由、公平竞争,提高全球消费者福利,是国际社会迫切需要解决的议题之一。通过对贸易政策和反垄断法在维护市场公平竞争秩序方面的各自实现途径的讨论,证明了他们是一种互动和互补关系。在全球化经济环境下,国际性贸易政策虽然得到了不断的完善。但是,国际反垄断法的发展却面临着重大的困难。因此,为真正实现国际贸易的公平自由竞争秩序,制订和完善国内反垄断法并推动反垄断法的国际化,具有相当的紧迫性。     

Persistent voting decisions in shareholder meetings

This study examined the determinants of voting decisions in shareholder meetings, with a special focus on voting persistence. The data captured votes on managerial proposals in shareholder meetings held by U.S. banks between 2003 and 2013. The dynamic panel data were analyzed using robust two‐step system generalized method of moments estimation (GMM) with orthogonal deviations. The lagged voting decision was a significant factor in explaining subsequent voting decisions. This finding provides evidence of voting persistence. Although persistence is a prominent topic in behavioral economics, studies have tended to focus on buying, consumption, and investment decisions. Persistence in voting decisions at the corporate level has been underexplored, so this article contributes to the behavioral economics literature.