The administrative state and fiscal policy: A comparative analysis of political issues in China and the United States

This article examines the budgetary politics in China and the United States. It illustrates the inherent political nature of fiscal policies produced by different political and economic systems. Although both countries are concerned with the distributive effects of reform, the study indicates that the central government of China confronts issues related to the distribution of power between the center and the provinces during economic transformation. In contrast, the debate in the United States is produced by the distribution of costs and benefits brought about by federal fiscal policy. The context of the debate is influenced, in part, by the administrative state.     

The Politics of Electoral Reform Abolition: The Informed Process of Israel's Return to Its Previous Electoral System

This article examines the process that led to the repeal of Israeli electoral reform (1992–2001) and compares it with that of reform adoption (1987–92). The most significant difference between the two processes is in the kinds of information that were available in them. In the politics of reform adoption, information was susceptible to manipulation and its supply was a crucial part of the struggle itself. In the politics of reform abolition, the real consequences of reform were constantly unfolding. This substantial difference resulted in other differences – not in type but in extent. First, while both were ongoing processes in which coalitions of supporters and opponents had to be built and then rebuilt several times, the cohesion of the camps throughout the struggle for reform abolition was higher than in the struggle for reform adoption. Second, while office-seeking successfully served as a basis for understanding the behavior of most parliamentary actors, the actual perceptions of its exact contextual meaning was dependent upon different available information. The two processes also had two common characteristics: power was diffused in both arenas of the politics of reform and in both instances the selection of the right timing proved to be necessary for successfully promoting the initiatives against veto players who were interested in preserving the status quo.     

Austerity versus Stimulus? Understanding Fiscal Policy Change at the International Monetary Fund Since the Great Recession

Since 2008, the International Monetary Fund (IMF) has become more open to the use of discretionary fiscal stimulus packages to deal with recessions, while changing its doctrine on the timing and content of fiscal consolidation. The article traces this evolution of the Fund's doctrine to staff politics, more diverse thinking in mainstream economics, and a careful framing of the message through the use of mainstream macroeconomic models. To map the changing contours of institutional views on fiscal policy through 2008–2013, the article undertakes a detailed content analysis of official publications from the Fiscal Affairs Department and the Research Department. The connection between these shifts and significant personnel shake‐ups is demonstrated through an extensive biographical analysis of the authors of all IMF studies cited in the official reports of the two departments. The findings contribute to the emerging debate on the sources of intellectual and policy change in international economic organizations.     

Testing Structuralist and Interpretative Explanations of Policy Change: The Case of Italy's Budget Reform

This article compares the relative explanatory power of structuralist and interpretative approaches to the study of policy change. By assessing the fit of these approaches against the actual reform of the formulation, approval, and implementation stages of Italy's budget process in the 1990s, the article shows that structural factors (such as fiscal pressures and changes in the electoral rules) played a key role in the reform of the formulation stage but not in that of the approval and implementation stages, where the content of reform followed the managerialist paradigm endorsed by the Italian reform community. Italy in the 1990s was under considerable pressure to achieve fiscal retrenchment, and the managerialist paradigm advocated measures that were largely antithetical to those that can be deduced from the changes in institutional context. Thus, the Italian case provides an excellent opportunity to assess the relative causal impact of ideas and structure on reform.     

From capacity to sovereignty: Legislative politics and differentiated integration in the European Union

The literature suggests that legislative politics among European Union Member States is characterised by economic exchanges, and constrained by the social norms of a European community of legislators. Both views draw a clear line between the legislative process and the conflicts over sovereignty that have left their mark on treaty making and European public opinion since the 1990s. This article suggests revisiting this view, based on an analysis of why Member States have opted out of legislation from the 1970s to today. It argues that differentiation, while once a response to capacity problems of relatively poor countries, has recently become driven by sovereignty concerns of the Union's wealthy and nationally oriented Members that oppose the EU's intrusion into core state powers. The article presents evidence for the impact on legislative outcomes of factors so far thought not to matter. The results indicate greater European‐level legislative responsiveness towards national sovereignty demands than previously recognised. They underline that the nature of European politics has been changing with the EU's push into core state powers.     

Partisanship in the setting and coordination of fiscal and monetary policies

Abstract. The principal concerns of this paper are with the roles partisan politics have played in the making of fiscal and monetary policies within OECD countries as well as the extent to which these policies have complemented each other. It is argued that parties of the left pursue fiscal policies that are distinctly different from those pursued by the right. The critical difference is in the way these parties use fiscal policy as a corrective mechanism for dealing with macroeconomic problems: leftist parties adopt counter–cyclical fiscal policies while rightwing parties adhere to pro–cyclical fiscal stances. The paper also examines two arguments regarding monetary policy and how partisan politics affect this policy area. The first and most conventional argument sees the formal independence of the central bank from government as a means of negating partisan influences on monetary policy; the second advances the proposition that, regardless of central bank independence, monetary authorities are not politically neutral but instead share views similar to those of parties on the right–hand side of the political spectrum. Empirical analysis, using a pooled cross–section time–series design with data from 14 countries between 1961 and 1994, produces evidence in favor of the argument concerning the role of partisanship in fiscal policy; it also shows little support for the view that central bank independence inhibits partisan influences while at the same time provides support for the thesis that central banks are politically non–neutral. Thus, coordination between fiscal and monetary policies is far less likely to occur when left–wing parties are in power.     

Partisanship in the setting and coordination of fiscal and monetary policies

The principal concerns of this paper are with the roles partisan politics have played in the making of fiscal and monetary policies within OECD countries as well as the extent to which these policies have complemented each other. It is argued that parties of the left pursue fiscal policies that are distinctly different from those pursued by the right. The critical difference is in the way these parties use fiscal policy as a corrective mechanism for dealing with macroeconomic problems: leftist parties adopt counter–cyclical fiscal policies while rightwing parties adhere to pro–cyclical fiscal stances. The paper also examines two arguments regarding monetary policy and how partisan politics affect this policy area. The first and most conventional argument sees the formal independence of the central bank from government as a means of negating partisan influences on monetary policy; the second advances the proposition that, regardless of central bank independence, monetary authorities are not politically neutral but instead share views similar to those of parties on the right–hand side of the political spectrum. Empirical analysis, using a pooled cross–section time–series design with data from 14 countries between 1961 and 1994, produces evidence in favor of the argument concerning the role of partisanship in fiscal policy; it also shows little support for the view that central bank independence inhibits partisan influences while at the same time provides support for the thesis that central banks are politically non–neutral. Thus, coordination between fiscal and monetary policies is far less likely to occur when left–wing parties are in power.     

Accounting for coalition‐building in the European Union: Budget negotiations and the south

Which parameters affect coalition building in budgetary negotiations? In this article, three distinct levels of analysis are identified to account for coalition building patterns, associated with domestic politics, domestic socioeconomic structures and EU politics. At the level of domestic politics, ideology points to cross‐governmental affinity of a partisan nature; at the level of socioeconomic structures, similarity of policy interests, generated by cross‐national socioeconomic convergence with EU policy standards, informs coalition formation patterns; at the EU politics level, the intergovernmental power balance influences the political aspirations of each Member State in the integration process and coalition‐building decisions. Two sets of parameters affect the evolution of EU coalition patterns, corresponding to the integration impact on the EU (new cleavages) and on the Member States (the impact of Europeanisation). This analytical framework is used to examine the southern coalition (Spain, Greece, Portugal) in the four multi‐annual financial frameworks (1988, 1992, 1999 and 2005).     

The politics of financial services regulation and supervision reform in the European Union

Abstract.  The regulation and supervision of financial services in the European Union (EU) has undergone major reform between 1999 and 2004. This policy evolution is theoretically interesting, raising the question of which conceptual approaches better explain it, and it is also empirically relevant because it is an area of intense EU activity. This article provides a theoretically informed and empirically grounded explanation of the policy reform by evaluating the analytical leverage of three integration theories, mainly by relying on two methods – process tracing and congruence procedure – employing a variety of primary and secondary sources. It is argued that sequencing different theoretical approaches – interdependence , supranational governance and liberal intergovernmentalism – explains the various stages of the policy-making process – namely, background-setting, agenda-setting and decision making, as well as the main features of the outcome.     

Thailand: The Politics of Reform of the Secretariat of the Prime Minister

This article discusses the politics of administrative reform. Though politicians and bureaucrats may agree on a reform blueprint, both tend to view administrative reform as means towards achieving different ends. To demonstrate the 'political tool' function of administrative reform, I will review the reform experience of the Thai Office of the Secretariat of the Prime Minister (OSPM) during the Chuan government (1992–95). Despite several proposals to reform the OSPM, at the end of its tenure the Chuan government had made only minor changes to the OSPM. This article argues that while failing to achieve significant reform, the process does demonstrate the politician-bureaucrat relationship.
The article is divided into two parts. The first outlines the conceptual framework which captures the politics of reform. The second presents four case studies representing efforts to introduce reform to the OSPM during the period of the Chuan government.
During the Chuan government, the author served as the Head of the Secretariat of the Administrative Reform Commission (ARC), ad hoc office in the OSPM established by the Prime Minister, charged with reviewing proposals to reform the OSPM. The author was also appointed to committees which were assigned to advise the PM about ways to reform the OSPM.     

The influence of federalism on fiscal policy making

Abstract. This article attempts to refine the statement that federal states face difficulties in fiscal policy making because of the territorial division of powers by comparing two federal countries, Canada and Germany. These two countries differ in terms of their type of federalism: Canada displaying a power-separation system and Germany corresponding to a power-sharing type. According to the authors, the territorial factor influences fiscal policy making through the distribution of taxing and spending powers as well as through patterns of intergovernmental relations. The use of fiscal policy instruments and the likely effects on conflict and cooperation in those two countries is discussed with empirical evidence. The authors come to the conclusion that federalism is indeed a constraint on fiscal policy making, but that the two types of power division face different obstacles and deal differently with fiscal problems. In the power-separation system of Canada, the federal government has encompassing competencies to use fiscal policy instruments unilaterally and without restraint, but faces a lack of concerted action with the provinces which reduces its scope of action in fiscal policy making. In the power-sharing system in Germany, concerted action facilitates macroeconomic stabilisation strategies but the compulsory negotiation system distorts the use of fiscal policy instruments by distributive bargaining.     

国际贸易谈判的政治经济分析:一个初步的框架(6)

加入WTO将给中国的改革开放进程带来深远的影响,也将会对中国的经济管理体制改革和政府管理体制改革带来巨大的挑战。对国际政治经济学有关贸易与国内政治的研究、国际贸易理论关于贸易政策之形成的研究、国际关系理论和博弈论关于国际谈判的研究进行了评述,并从国际政治经济学的角度提出分析国际贸易谈判的一个初步的分析框架。通过强调国内政治、策略行为和国际规则的重要性,并从公民政策偏好的形成、利益集团集体行动、两国贸易谈判之间的双层博弈、国际规则的制约因素等多方面讨论了如何分析贸易谈判。     

What makes fiscal consolidations last? A survival analysis of budget cuts in Europe (1960–2004)

This article examines the political and economic determinants of the relative duration of fiscal consolidations in Europe. The study focuses on the fifteen Member States that formed the EU between 1960 and 2004, and applies survival analysis techniques to their fiscal data. We find evidence that the probability of ending a period of fiscal consolidation depends on the debt level, the magnitude of the adjustment, the relative contribution of spending cuts, and the degree of cabinet fragmentation. Most importantly we also find that under a stricter definition of fiscal consolidation, political variables, such as coalition size and election year, gain importance with respect to economic variables as predictors of the probability of ending an episode of fiscal consolidation. This relative importance of political variables weakened in the run-up to EMU, probably because countries had to consolidate irrespective of their political constraints.     

From selective integration into selective implementation: The link between differentiated integration and conformity with EU laws

In recent years, the topic of differentiated integration in the European Union has become increasingly discussed in both political science research and politics in general. Whereas differentiated integration is viewed as necessary for deeper cooperation, recent findings suggest that it increases the gulf between participants and non‐participants, making it difficult for non‐participating countries to join in later negotiations. However, there is a lack of theoretical and empirical work regarding the relationship between different levels of participation in the EU and national policy outcomes. This article addresses this question by comparing the policy outcomes in fully participating, selectively participating (opting‐in) and non‐participating (opting‐out) EU Member States relative to EU legislation. The findings show that selective participation (opting‐in) increases state conformity with EU laws relative to no integration at all (opting‐out), but it does not completely bridge the gap between fully integrated Member States and non‐participants. The results suggest that countries with flexible arrangements are generally less likely to implement EU laws than full participants, even when they choose to legally commit to the EU requirements. This finding raises some further questions about the rationale behind selective participation and its consequences for policy conformity, if its application expands to other policy areas and more Member States in the future.     

Fiscal Decentralization as Development Policy

Fiscal Decentralization is a popular economic development strategy among transition and developing countries. This article reviews the advantages of fiscal decentralization in a theoretical context, but critiques the relevance of the standard theory of federalism as it applies to emerging economies. It is argued that the macroeconomic benefits of fiscal centralization, the absence of good instruments of local government finance, and the centralist politics that characterize most low income countries have been strong enough to hold back increased emphasis on local government finance.     

Rethinking corporatism and consensus: the dilemmas of German social-protection reform

This article explores the competing influences of institutional legacies and political negotiation in recent German social-protection reform. Long a paragon of consensus and gradual political change, the German political economy has adjusted poorly to the pressures of fiscal austerity and structural unemployment, creating pressures for an increasingly salient role for the federal government. The article provides a detailed analysis of recent German social-policy and labour-market reforms, arguing that existing literature is poorly equipped to account for this emerging policy-making paradigm. It also suggests that, while the German case illustrates the importance of institutional factors in shaping reform trajectories in advanced industrial democracies, careful attention must also be paid to élites' capacity for negotiating policy outcomes within these parameters.     

Macroeconomic performance,political trust and the Great Recession: A multilevel analysis of the effects of within‐country fluctuations in macroeconomic performance on political trust in 15 EU countries, 1999–2011

Recent cross‐national comparative studies have found no effect of countries’ macroeconomic performances on trust in national political institutions, once political explanations (most notably corruption) are taken into account. Although political trust is not determined by the comparison of national economic performance to other countries, it is argued in this article that it is affected by comparisons to their own past performance. In a multilevel, fixed effects analysis of Eurobarometer data (21 waves in 15 European Union Member States between 1999 and 2011) the extent to which within‐country variations in economic performance affect political trust longitudinally is tested. Three major conclusions are reached. First, within‐country, longitudinal changes in performance (growth, deficits, unemployment and inflation) affect political trust. Second, the impact of macroeconomic performance is stronger among the lower educated. Third, even in times of economic duress, budgetary deficits tend to undermine political trust.     

An experimental analysis of voting in the Stability and Growth Pact in the European Monetary Union

The Stability and Growth Pact (SGP) in the European Monetary Union shall deter countries from running excessive deficits by the threat of punishment, executed conditional on the outcome of a multistage voting procedure. We examine voting behaviour in an experiment which closely resembles the SGP’s design and find that the SGP enables larger countries to block punishment more often than smaller countries. In addition, we study an institutional modification of the SGP by excluding countries with excessive deficits from voting on other ‘fiscal sinners’. Our findings clearly suggest that this innovation would give the SGP sharper teeth than it actually has in reality.     

Multilevel Governance and Shared Sovereignty: European Union, Member States, and the FCTC

The Westphalian idea of sovereignty in international relations has undergone recent transformation. "Shared sovereignty" through multilevel governance describes the responsibility of the European Union (EU) and its Member States in tobacco control policy. We examine how this has occurred on the EU level through directives and recommendations, accession rules for new members, tobacco control campaigns, and financial support for antitobacco nongovernmental organizations. In particular, the negotiation and ratification of the Framework Convention on Tobacco Control (FCTC) and the participation in the FCTC Conference of the Parties illustrates shared sovereignty. The EU Commission was the lead negotiator for Member States on issues over which it had jurisdiction, while individual Member States, through the EU presidency, could negotiate on issues on which authority was divided or remained with them. Shared sovereignty through multilevel governance has become the norm in the tobacco control policy area for EU members, including having one international organization negotiate within the context of another.     

The Politics of Fiscal Austerity: Implications for the United States

As austerity becomes the new normal for advanced nations, questions are raised about whether nations can make the hard choices necessary to bring about a sustainable fiscal future. The political defeat experienced by so many European governments undertaking fiscal consolidations points to the vulnerabilities that leaders will face. This article shows that how some Organization of Economic Cooperation and Development (OECD) nations have survived the daunting politics of fiscal consolidation by timing actions for periods of economic recovery and political honeymoons following elections and by pursuing deficit reduction strategies that emphasize broad sweeping changes yielding high potential for dramatic economic gains over the longer term. Unlike many European nations today, the seemingly endless appetite for US treasuries by worldwide markets give the United States the luxury of choosing to begin deficit reduction only when the economy strengthens. However, the absence of market pressure also reduces the sense of urgency, consigning national leaders to create internal crises such as the 2012 “fiscal cliff” to force their own hand. While the polarized politics characterizing our party system does not bode well for concerted fiscal action, divided government carries the potential for spreading political risks and promoting more sustainable fiscal outcomes, as it has in our recent history and in other nations as well.