Comment on Tollison’s contributions to economic history and the history of economic thought

Abstract Robert Tollison has furthered our understanding of mercantilism and other pivotal episodes in economic history considerably and also has applied the methods of positive economics to study the development of economic thought more generally. This article traces Tollison’s intellectual interest in those topics to his liberal arts education as an undergraduate at Wofford College and supplies commentary on Ekelund and Hébert’s valuable survey of his contributions to those areas of the literature.     

It’s all ‘bad’ news! Voters’ perception of macroeconomic policy competence

The purpose of the present paper is to consider how voters form perceptions about macroeconomic policy competence by focusing on the role of recent macroeconomic news: Do their perceived views of good news matter as much as bad news when they form beliefs about the incumbent government’s competence in managing the macroeconomy, in particular, with regard to their ability to control inflation and unemployment? We find that ‘bad’ news about unemployment persists when households are forming their perceived competence, whereas “good” news does not. That is, voters tend to display pessimistic bias when forming perceptions about the incumbent government’s competence.     

The socio‐economic structure of European democracies

The article presents the findings of a factor analysis concerning socio‐economic structure and socio‐economic development in sixteen European democracies. The socio‐economic structure of these nations consists of three dimensions: level of affluence, level of industrialisation and degree of urbanisation. A prominent feature in the change of the contemporary social structure of Western Europe is the weakening of the relationship between affluence and industrialisation. Statements about the implications for political life of socio‐economic structure and socio‐economic development entering into theories about modernisation and social mobilisation may be clarified and tested only if socio‐economic concepts are made operational in terms of a set of indicators, the interaction between which can be stated by means of factor analysis and used in the construction of indices.     

Do differences in presidential economic advisers matter?

Using data on members on the Council of Economic Advisors as well as US Treasury secretaries and OMB directors from 1952 through 2005, I investigate the effect of economic advisors’ educational and employment backgrounds on the time series performance of several policy variables. Ivy League advisors appear to raise non-defense government spending, although the size of the impact differs by president. While voter preferences appear to matter for a wider variety of policy variables (changes in federal regulation and marginal tax rates), the share of Ivy League advisors is at least as important as voter preferences in explaining non-defense spending.     

Drivers of political parties’ voting behaviour in European economic governance: the ultimate decline of the economic cleavage?

The article examines the factors that determined the attitude of parliamentary parties towards eurozone anti-crisis measures. Using a statistical logit model, it demonstrates that, while all governing parties supported such measures, opposition parties were divided. The support of the former is explicable in terms of international obligations. The positions of opposition parties reflected their attitude towards European integration: Eurosceptic parties tended to oppose anti-crisis measures. Furthermore, whereas negative votes were less likely in countries marked by higher levels of popular trust in government and satisfaction with the problem-solving capacity of the EU, the likelihood of no votes increased as a function of the level of trust in national parliaments. The policy preferences of opposition parties, measured on the economic left–right scale, did not provide significant explanatory potential; nor did an additional test measuring the impact of extreme left?right positions.     

Dilatory or anticipatory? Voting on the Journal in the House of Representatives

In this paper, I examine a simple procedure in the United States House of Representatives, approving the Journal, and its implications for legislative business. In this paper, I examine the hypothesis that such votes are more than simply pro forma motions or dilatory tactics by the minority party. Considering the 102nd–107th Congresses, I show that votes on the Journal’s approval are just as frequently requested by the majority party as by members of the minority party. Furthermore, I find that votes recorded on days on which a vote was also recorded on the House Journal were more likely to be close and more likely to be party-line votes than those recorded on other days.     

Is newspaper coverage of economic events politically biased?

This paper develops an econometric technique to test for political bias in news reports that controls for the underlying character of the news reported. Because of the changing availability of the number of newspapers in Nexis/Lexis, two sets of time are examined: from January 1991 to May 2004 and from January 1985 to May 2004. Our results suggest that American newspapers tend to give more positive coverage to the same economic news when Democrats are in the White House than when Republicans are; a similar though smaller effect is found for Democratic control of Congress. Our results reject the claim that “reader diversity is a powerful force toward accuracy.” When all types of news are pooled into a single analysis, our results are significant. However, the results vary greatly depending upon which types of economic data are being reported. When newspapers are examined individually the only support that Republicans appear to obtain is from the president’s home state newspapers during his term. This is true for the Houston Chronicle under both Bushes and the Los Angeles Times during the Reagan administration. Contrary to rational expectations, media coverage affects people’s perceptions of the economy.     

Does government ideology influence deregulation of product markets? Empirical evidence from OECD countries

This paper examines how government ideology has influenced deregulation of product markets in OECD countries. I analyze a dataset of non-manufacturing regulation indicators covering energy, transport and communication industries in 21 OECD countries over the 1980–2003 period and employ two different indices of government ideology. The results suggest that government ideology has had a strong influence on the deregulation process: market-oriented governments promoted the deregulation of the energy, transport and communication industries. This finding identifies remarkable differences between leftist and rightwing governments concerning the role of government in the economy and basic elements of political order.     

Does social capital increase public support for economic globalisation?

The dominant explanation of public attitudes vis‐à‐vis economic globalisation focuses on re‐distributional implications, with an emphasis on factor endowments and government‐sponsored safety nets (the compensation hypothesis). The empirical implication of these theoretical arguments is that in advanced economies, on which this article focuses, individuals endowed with less human and financial capital will be more likely to experience income losses. Hence they will oppose economic openness unless they are compensated by the government. It is argued here that including social capital in the analysis can fill two gaps in explanations relying on factor endowments and the compensation hypothesis. First, generalised trust – one key aspect of social capital – constitutes a personal endowment alongside human and financial capital. Second, structural social capital – another key aspect of social capital – can be regarded as a nongovernmental social safety net that can compensate for endowment‐related disadvantages of individuals. Both aspects of social capital are expected to contribute, for distinct reasons, to more positive views on economic openness. The empirical testing relies on survey data for two countries: Switzerland and the United States. For both countries, the results indicate that generalised trust has a strong, positive effect on public opinion of economic globalisation, whereas structural social capital has no effect.     

What are the current preoccupations of economic voting research?

The papers in this volume remind us of the enormous amount of research that has been conducted to date on the economic voting thesis. The sheer volume of findings reported in this theme issue alone is impressive and richly diverse. But what are the core preoccupations that presently fuel this line of investigation? The contributors to this volume include several of the major players in the field. This provides a convenient opportunity to take a snapshot of where the current priorities lie. In all, we see at least two main trajectories, both of which appear to be well on their way to delivering a variety of informative insights.     

Strategic entry deterrence and terrorism: Theory and experimental evidence

Using a two stage rent-seeking framework, we present a simple model of strategic entry/terrorism deterrence and test the model using laboratory experiments. Our contest success function highlights the potential for strategic spillovers. The theory illustrates that, relative to a cooperative outcome, negative externalities lead to over-spending on deterrence and positive externalities lead to under-spending on deterrence. Our experimental results are broadly consistent; subjects in the negative externality treatment had higher expenditures. In contrast to theoretical predictions, participation decisions, while primarily driven by the probability of winning a contest, were influenced by a subject’s ability to participate in multiple contests.     

Eminent domain power and afterwards: Leviathan’s post-taking opportunism

This paper investigates post-taking procedures, a research area not yet fully explored. It discusses the economic implications underlying the landowner’s ‘repurchase right (RR)’ which can be invoked upon the occurrence of a so-called ‘change in use after taking.’ RR is compared with the government’s discretion regarding such changes. The lack of post-taking accountability tends to create power ripe for abuse, and RR appears to be an effective device for constraining Leviathan’s opportunism. Finally, a parsimonious estimation supports that, under the overriding-RR regime, there exists the systematic post-taking opportunism whereby ‘original public projects are changed into inappropriate projects.’     

Sino‐French relations: Historical alliance vs. economic reality

Abstract

In an increasingly integrated international economy, nation-states are, of themselves, no longer the prime containers or coordinators of political–economic activity. The extra-territoriality of states and the blurring of the boundaries between states and firms, for example, have been captured in analytical concepts such as ‘triangular diplomacy’ the ‘web of global interdependencies’ and ‘cosmopolitan democracy’. Such trends have become visible in what have been termed mega-urban regions or zones of economic integration or of graduated sovereignty. Moreover, such zones are held to illustrate non-traditional or cooperative inter-state relations. This paper utilizes Stopford and Strange's (1991) Stopford, J. and Strange, S. 1991. Rival States, Rival Firms: Competition for World Market Shares, Cambridge: Cambridge University Press. [Crossref] , [Google Scholar] notion of ‘triangular diplomacy’ to interpret the development of one such zone – the Indonesia–Malaysia–Singapore growth triangle (IMS-GT). The paper argues that whilst embodying elements of cooperative inter-state relations the development of the IMS-GT also highlights the persistence of the ‘traditional’ concerns of inter-state relations. It also uses the notion of triangular diplomacy to draw attention to different models of social order sought by multinational enterprises (MNEs).     

Does economic inequality undermine political equality? Testing two common assumptions

In recent years, scholars have expressed concern that democratic political systems are more responsive to rich citizens than to poor citizens under conditions of economic inequality. However, it is unclear whether economic inequality leads to unequal influence on government. Moreover, despite claims that proportional representation reduces inequalities in representation, there is no evidence that it does. I test these two prominent claims by connecting two types of citizens’ preferences to the composition of government in non-presidential systems using the Comparative Study of Electoral Systems (CSES) dataset. I find that rich citizens gain better representation in government than the poor more often than the reverse. However, I find no evidence of an association between economic inequality and inequalities in representation or that proportional representation influences income gaps in representation.     

A note on ‘Labour value and socialist economic calculation’

Cockshott and Cottrell have reopened a debate which has been engaged with vigour in the past, but, as they rightly point out, needs to be reassessed in the light of current technology. They describe their ideas as being ‘work in progress’, and this note attempts to retain this spirit. While differing on technical matters, it emphasises the need for such a reassessment and discusses some further possibilities.

A number of different issues are addressed in their paper: these include the use of labour values as a tool in economic planning and the computational feasibility of such a process. Formal definitions are given using a computer orientated notation.¹ This note separates the issue of the impact of increasing computing power on the feasibility and desirability of computing a central plan from the issue of using Marxian labour values as a method of calculation.

Much of what Cockshott and Cottrell say is related to a wide body of literature in mainstream economics, but whose mathematical nature has given it a restricted circulation.² For instance the problem of decomposing the input-output matrix, and the problems of designing a system which clearly sets up the information which would pass from central planners to decentralised decision makers. Cockshott and Cottrell also deal at length with the specific point of using market price/labour value (cost) as an indicator in deciding which lines of production to expand or contract. This fits into a tradition which offers a number of possibilities for deciding which criteria to use.     

Intelligence,crises and security: Lessons from history?

The scholarly study of intelligence has grown steadily into what is now a distinct sub-field of history and political science. Recent events – notably jihadist attacks on the US, Spain and the UK and the war on Iraq and its aftermath – have generated debate and controversy about the use and representation of intelligence. A plethora of official inquiries have fuelled debates into the ‘intelligence failures’ involved. This essay explores how lessons might be learned from the history of intelligence for contemporary debates and controversies. An overview of the issues includes discussion of how different approaches are apparent between American and British perspectives. Challenges and opportunities for applying lessons from the past are explored and a case is made for greater engagement between academia and officialdom.     

The fraying of the socio‐economic fabric of Hong Kong

Abstract

Since the 1980s, Hong Kong has undergone momentous socio‐economic changes, which in turn have greatly affected public attitudes toward society and the economy. Interpersonal trust and the sense of community have weakened. Hong Kong as a society is increasingly seen as unfair in the sense that it is not perceived as a land of opportunities for the hardworking. The capitalist rules of the game are increasingly considered by the people to be unacceptable. Public demands for more governmental intervention in the economy, particularly in the area of income redistribution, are increasingly raised. Nascent feelings of class antagonism are palpable as economic inequalities are getting worse. As social conflicts of various kinds proliferate, public anxieties about Hong Kong's fraying socio‐economic fabric have come to the fore. People expect the government and the legal institutions to strengthen social order. At the same time, however, public trust of all social, economic and social authorities is declining. Accordingly, as social discontent and anxieties accumulate, the socio‐economic system of Hong Kong will face serious challenge in the years ahead.