Regulating Finance: Who Rules,Whose Rules?

This project has embedded in it an explanation of the structural and relational power transmission process stemming from “micro-actions” in global financial relations. This paper is about domestic policy adaptation in international and domestic finance and how it occurs. The fundamental contention of this paper is that the way to understand power in global finance is to provide an answer to the question: Who makes the rules in finance—state actors or nonstate actors? The answer to this question is problematic in the IPE literature because of both the enormous influence of finance in the councils of the industrial democracies and the information asymmetries that favor power in finance. Finance, it is argued, has the determining influence on the rules governing its industry. The dependent variable in this analysis is the policy output—the regulation and liberalization decisions of states. The behaviors of the state and of other policy actors in the policy process are the independent variables.     

How the City of London lost at Brexit: a historical perspective

The nature of the City of London as an offshore financial centre has long made London dependent on the British state providing protection from external political regulation, even as London’s foreign currency business separated its interests from British governments’ economic policy preoccupations. Since the 2008 crash and the onset of the eurozone crisis, London has faced threats to both its autonomy from external regulatory demands and to its offshore business interests at the same time as the long-standing external statecraft of British governments around EU membership has broken down. The Cameron governments’ efforts to protect the City within the European Union under political conditions that were transformed by the eurozone crisis exposed the limits of Britain’s position as a member of the European Union. When David Cameron then tried to resolve the problem of EU membership through a referendum he made it extremely difficult to defend the City’s broader commercial interests in the Single European Market because freedom of movement issues weighed significantly more in British domestic politics than financial services.     

The Irish Parliamentary Elections of 2007: New Gloss on an Old Engine

The issues of Kosovo independence and European Union membership have dominated Serbian domestic politics and foreign policy since the fall of Slobodan Milo?evi? in 2000. Despite the lack of formal EU conditionality on the Kosovo issue, Serbia’s insistence on its uncompromising ‘no recognition’ of Kosovo policy has been detrimental to its EU candidacy aspirations. This article examines Serbia’s Kosovo policies in the context of EU integration, in particular the divergence between Serbia’s stance towards Kosovo and its aspirations towards EU candidacy. Considering the negative effects that the Serbia–Kosovo relationship has had on regional cooperation and Serbia’s EU integration, this article considers why Serbia appears to have failed to ‘Europeanise’ its Kosovo policies, i.e. to normalise relations in a way that would be more favourable to accession. In doing so, it examines Serbia’s Kosovo policies since 2000, and the ways in which domestic actors have deliberately manipulated and complicated the question of Kosovo and Serbia’s EU membership.     

Domestic regulatory reform and transgovernmental networks: Brazil and China in the global competition regime

Developing countries increasingly participate in transgovernmental networks of global regulatory governance, but they do so in different ways. This article aims to provide an explanation for this variation for two of the major emerging powers in the world economy, Brazil and China, in their transition toward more active players in the global competition regime. Distinguishing between bilateral and multilateral transgovernmental networks and examining the domestic factors conditioning the transition of their national competition agencies from rule-takers to rule-promoters or rule-makers through these networks, the article makes theoretical contributions to the linkage between transgovernmentalism and the regulatory state. I argue that differing political needs and the incomplete process of regulatory state formation push domestic agencies to join transgovernmental networks, with a need for greater legitimacy steering the Brazilian regulators to multilateral networks and facilitating their transition from rule-takers to rule-promoters. The Chinese agencies' primary need for expertise rather than legitimacy, by contrast, led them to pursue technical assistance and cooperation via bilateral relationships. The Chinese approach has slowed its transition from rule-taker to rule-promoter where its norms and practices are aligned with the established powers. Such approach will further impede its transition into a global rule-maker in areas of competition law and policy where China's preferences diverge.     

Interlocal Service Cooperation in U.S. Cities: A Social Network Explanation

Local governments increasingly confront policy problems that span the boundaries of individual political jurisdictions. Institutional theories of local governance and intergovernmental relations emphasize the importance of networks for fostering service cooperation among local governments. Yet empirical research fails to examine systematically the effects of social networks on interlocal service cooperation. Do the individual networks of local government actors increase their jurisdiction's level of interlocal service delivery? Drawing data from the National Administrative Studies Project IV (NASP‐IV), multivariate analysis is applied to examine this question among 919 municipal managers and department heads across the United States. The findings indicate that interlocal service cooperation increases when jurisdictional actors network frequently through a regional association or council of government and when they are united by a common set of professional norms and disciplinary values. Manager participation in professional associations, however, does not increase interjurisdictional cooperation. The key conclusion for local government practitioners searching for ways to increase collaboration: networks that afford opportunities for more face‐to‐face interaction yield better results for effective service partnerships.     

Designing Regulation Across Organizations: Assessing the Functions and Dimensions of Governance

In recent years, regulation scholars and policymakers have increasingly turned their attention to the role of inter-governmental organizational design in effective governance. The existing literature on regulatory design has provided important insights into the advantages and disadvantages of alternative structural options. This article synthesizes and builds on that literature by describing a novel framework for characterizing, analyzing, and structuring authority across public institutions. Drawing on examples from a range of jurisdictions, it highlights the value of this framework in identifying the values tradeoffs that should drive policymakers' decisions to choose among competing structural alternatives. The framework is founded on two important points. First, inter-governmental allocations of authority can be structured along three different dimensions. Failing to appreciate the existence of, and differences among, these dimensions can prompt misassessments of the reasons for existing regulatory failures and selection of structural allocations that do not suit the problems intended to be addressed. Second, allocations of authority can, and in many cases should, vary for disparate governmental functions. Differential functional allocations of authority can minimize obstacles to needed structural reforms and tailor inter-governmental relations in ways that best promote chosen regulatory values, such as efficiency, effectiveness, and accountability, as well as how allocational choices may and perhaps should vary depending on the governmental function being performed. Finally, the article suggests how future regulation and governance scholarship can harness this emerging framework to help build a body of empirical evidence upon which policymakers can draw in future regulatory design endeavors.     

The rewards of cooperation: The effects of membership in European regulatory networks

Networks famously epitomize the shift from ‘government’ to ‘governance’ as governing structures for exercising control and coordination besides hierarchies and markets. Their distinctive features are their horizontality, the interdependence among member actors and an interactive decision‐making style. Networks are expected to increase the problem‐solving capacity of political systems in a context of growing social complexity, where political authority is increasingly fragmented across territorial and functional levels. However, very little attention has been given so far to another crucial implication of network governance – that is, the effects of networks on their members. To explore this important question, this article examines the effects of membership in European regulatory networks on two crucial attributes of member agencies, which are in charge of regulating finance, energy, telecommunications and competition: organisational growth and their regulatory powers. Panel analysis applied to data on 118 agencies during a ten‐year period and semi‐structured interviews provide mixed support regarding the expectation of organisational growth while strongly confirming the positive effect of networks on the increase of the regulatory powers attributed to member agencies.     

State Attorneys General, Entrepreneurship, and Consumer Protection in the New Federalism

Although many scholars have acknowledged the important roleof states in regulatory enforcement, few have studied the decisionsof the state attorneys general to pursue particular multi-statelitigation actions. State attorneys general act as politicalentrepreneurs because they aggressively seek out market failuresin society to justify stronger regulation. Their motivationto serve the public comes from the fact that they are electedin 43 states and the office is often used as a springboard intohigher political office. A probit model analyzing the decisionto join seven high-profile multi-state enforcement actions thatlook place between 1996 and 1998 reveals that state citizenideology and the institutional structure of the office havethe strongest effects on the decision to join a case.     

Competitors and Cooperators: A Micro‐Level Analysis of Regional Economic Development Collaboration Networks

Predispositions and orientation toward cooperation or competition with other jurisdictions can play a critical role in implementing regional collaboration. By examining collaboration at the micro level, this article investigates how individual factors, including perceptions of cooperation and competition, as well as institutional and environmental factors, are related to regional collaboration. In particular, the authors assert that competitive motivation may support the emergence of regional governance mechanisms. This article explores the relationships between competitive/cooperative motivations and interlocal collaboration networks based on a network survey conducted in the Orlando, Florida, metropolitan area. The authors apply a quadratic assignment procedure regression analysis to examine how dyadic conceptual ties of cooperation and competition, along with the effect of community characteristics, affect policy network structures for economic development. By comparing estimated coefficients with sampling distributions of coefficients from all of the permuted data sets, the regression results indicate the influences of perceived competition/cooperation on the network exchange.     

Veto players, electoral incentives and international commitments: The impact of domestic institutions on intergovernmental organization membership

Abstract.  The conventional literature on international cooperation in general, and intergovernmental organization membership in particular, depicts a regular, positive relationship between wealthy capitalist democracies and participation in international institutions. While empirical evidence supports this assertion, it says little about the mechanisms, and the accompanying variation among them, by which states enter into international institutions. This study distinguishes industrialized democracies along two dimensions: the nature of their constitutional structures and the organization of their electoral politics. Variations in these features produce variations in the institutional constraints and electoral incentives that matter in determining state participation in international organizations. Results of a pooled cross-sectional time series analysis of 23 democracies in 1981 and 1992 indicate that the structure of governing institutions and the nature of electoral systems account for much of the variation in intergovernmental organization membership. This study concludes that domestic institutions matter in determining international cooperation through international organizations – a novel insight overlooked by most international relations theories.     

Does Tolerance of Religion in the Public Space Depend on the Salience of the Manifestation of Religious Group Membership?

The question of the role of Islam in the public space has become a new pivotal point in political disputes about civil liberties in Western Europe. This debate challenges the scholarly literature on tolerance by highlighting that our understanding of the situational factors shaping tolerance judgments remains limited. This study therefore investigates how the salience of the signaling of religious group membership influences religious tolerance. Based on a unique question-wording experiment embedded in an approximately nationally representative survey, I demonstrate that conspicuous manifestations of religious outgroup membership spark stronger intolerance than subtle manifestations and that anxiety mediates the effect of conspicuous manifestations of religious outgroup membership. Finally, I demonstrate that the effect of the salience of religious outgroup membership is strongest among those who are highly opposed to secularism. I conclude by discussing how these findings constitute an important extension of the extant work on tolerance and feed back into the discussion regarding the role of religion in the public space.     

全球化与行政管理制度变迁

政府转型是国际政治和国内政治互动过程中的重要问题,而政府在面对国际制度挑战中处于核心角色,形成和国际制度相适应的协调制度是政府转型的主要特征.通过大量的实证材料和个案分析,在对国际制度、公共政策协调和发展型政府理论进行理论综述的基础上,阐述了国际制度下的政府转型现象.这种现象指的是在发展型政府国家,国际制度为国内政策制定引入了全球化因素,并促使国家内部建立与国际制度联系的对口协调部门或制度.这些都有利于国际制度进一步塑造国内决策环境.伴随着国际制度的发展,发展中国家决策过程日益专业化和多元化,政府转型成为全球化时代中的一个显著特点.主要采用文献分析和实证研究相结合的方法,在实证研究中采用文本分析和深度访谈的方法.发现,国际制度会通过议事日程和规则的变化、新的配套协调决策机构的建立等来影响部门利益的表达、部门与跨部门的知识(信息)的建构、以及各部门对最后决策形成的意见、建议、交换,并导致新的国内制度的产生.     

The challenge of accountability in complex regulatory networks: The case of the Deepwater Horizon oil spill

A puzzle that faces public administrators within regulatory governance networks is how to balance the need for democratic accountability while increasingly facing demands from elected officials to optimize oversight of industry by utilizing the expertise of the private sector in developing risk‐based standards for compliance. The shift from traditional command and control oversight to process oriented regulatory regimes has been most pronounced in highly complex industries, such as aviation and deepwater oil drilling, where the intricate and technical nature of operations necessitates risk‐based regulatory networks based largely on voluntary compliance with mutually agreed upon standards. The question addressed in this paper is how the shift to process oriented regimes affects the trade‐offs between democratic, market, and administrative accountability frames, and what factors determine the dominant accountability frame within the network. Using post‐incident document analysis, this paper provides a case study of regulatory oversight of the deepwater oil drilling industry prior to the explosion of the Deepwater Horizon rig in the Gulf of Mexico, to explore how the shift to a more networked risk‐based regulatory regime affects the trade‐offs and dominant accountability frames within the network. The results of this study indicate that a reliance on market‐based accountability mechanisms, along with the lack of a fully implemented process‐oriented regulatory regime, led to the largest oil spill in US history.     

The Politics of ‘Third Country Equivalence’ in Post-Crisis Financial Services Regulation in the European Union

After the global financial crisis, the European Union has adopted a new regulatory approach towards foreign countries by making use of equivalence rules in finance. Why? This paper argues that it is the EU’s attempt to restore financial stability in its territory and maintain the competitiveness of its financial industry. However, this ‘old’ dilemma between stability and competition in financial regulation is further complicated in a regional jurisdiction, such as the EU, because different regulatory paradigms play off in the dilemma.     

Can the hidden hand of the market be an effective and legitimate regulator? The case of animal welfare under a labeling for consumer choice policy approach

In Australia, labeling for consumer choice, rather than higher government regulation, has become an important strand of the policy approach to addressing food animal welfare. This paper illustrates the usefulness of “regulatory network analysis” to uncover the potentials and limitations of market‐based governance to address contentious yet significant issues like animal welfare. We analyzed the content of newspaper articles from major Australian newspapers and official policy documents between 1990 and 2014 to show how the regulatory network influenced the framing of the regulatory problem, and the capacity and legitimacy of different regulatory actors at three “flashpoints” of decisionmaking about layer hen welfare in egg production. We suggest that the government policy of offering consumers the choice to buy cage free in the market allowed large‐scale industry to continue the egg laying business as usual with incremental innovation and adjustment. These incremental improvements only apply to the 20 percent or so of hens producing “free‐range” eggs. We conclude with a discussion of when and how labeling for consumer choice might create markets and public discourses that make possible more effective and legitimate regulation of issues such as layer hen welfare.     

An empirical study of the consolidation of local public health services in Connecticut

This study contributes to the literature by empirically examining the decision of Connecticut communities to consolidate the delivery of public health services. As theory suggests, the prospect of scale economies is found empirically to increase the likelihood that a community consolidates public health services. In addition, differences across communities are found to inhibit the consolidation of public health services. Overall, the results imply that financial incentives may be necessary to encourage more regional districts because localities may underestimate the true minimum efficient scale for public health services and because heterogeneity among jurisdictions impedes regional cooperation.     

Protectionist policies as the regulation of international industry

The political feasibility of protectionist policies that regulate international industry derives from the absence of overt collusion among domestic import-competing producers. The regulation of international industry cannot be explicit since governments would thereby be perceived to be approving (or instigating) international collusion. Hence, voluntary export restraints have been popularly presented with a focus on the difficulties confronted by domestic import-competing producers and a de-emphasis on the mutual gains to domestic and foreign producers from monitoring by a foreign government of a restrictive export cartel arrangement. Similarly, trigger-price mechanisms have popularly been explained in terms of the need for anti-dumping measures to preserve fair competition. Likewise, the involuntary export tax derived in the first instance from an administratively validated (but, as demonstrated by Kalt's econometric analysis, contentious) complaint of unfair foreign competition. Voluntary export restraints, trigger-price mechanisms, and involuntary export taxes are however protectionist devices, the beneficiaries of which can transcend national jurisdictions, and which have in common the characteristic that the gains to domestic industry interests derive from the regulation of foreign competitors.A previous version of this paper was presented at a conference on Economics and Power organized by the FWS Institute of Zug and held at Interlaken, Switzerland in July 1988.     

COMPETITION AND PERFORMANCE IN THE AIRLINE INDUSTRY

The paper examines the airline industry ten years after the Airline Deregulation Act of 1978. A brief review of the historical background of regulation and the changes leading to the Airline Deregulation Act is presented. A number of studies are cited that conclude that airline perfor- mance has improved since the Civil Aeronautics Board days. The author agrees with these conclusions but goes on to suggest that it is time to begin comparing the airline industry today with the standards of performance associated with perfect competition instead of the previous regulatory period. A standard of competitive performance is suggested. The traditional p=mc=ac performance is complicated because mc and ac decline for any airline flight until the plane is full or has a 100% load factor. The author suggests p=acat load factors are not yet reaching loo%, it is suggested that some policy modifications might help improve performance further. An- titrust is examined and some other institutional policy changes are sug- gested.     

Industry effects of medical device regulation: the case of diagnostic imaging equipment.

In 1976 Congress passed legislation authorizing the regulation of all medical devices. Some observers predicted that this regulation would have adverse effects on the newly regulated industries. This paper examines the major features of the medical device regulatory program and investigates how the regulation has affected the diagnostic imaging equipment industry. The results indicate that medical device regulation has not materially affected competition or innovation within established product classes in this industry. This suggests that, by choosing methods of regulation that differentiate among levels of potential risk to consumers, the goal of consumer protection can be achieved with fewer undesirable effects on the regulated industry.