The politics of bank ownership and currency policies in Central and Eastern Europe

This paper argues that state-owned, private domestic, and foreign banks have different preferences for exchange rate policies. More specifically, I posit that governments will be less willing and able to maintain fixed exchange rate arrangements in closed banking systems dominated by government-owned banks than in globalized banking systems with a large presence of foreign banks. The article’s principal claim rests on the notion that ownership structure of the banking system empowers different types of banks, affects their interests, and shapes the responsiveness of government politicians to bank demands. The bank ownership types further influence the stability of the domestic monetary system and financial regulation that are of paramount importance in the determination of exchange rate regimes. An empirical investigation of data on exchange rate regimes for 25 Central and Eastern European countries provides strong support for the theory. The results are robust to alternative estimation techniques, instrumental variable analysis, and the inclusion of several economic and political variables.     

Empirical Modeling of Policy Diffusion in Federal States: The Dyadic Approach

Policy diffusion is a common phenomenon in federal states: indeed, one of the normative justifications of decentralized policy making is that it permits the development and spread of best practices. Following Berry and Berry (1990), event‐history analysis has been the method of choice for the quantitative investigation of policy diffusion, but Volden (2006) has recently introduced a dyadic variant of this method in which units of analysis are not states but, instead, pairs of states. This article discusses the dyadic approach with a particular focus on the diffusion of policies in Switzerland. The goal is not to introduce a new method, but rather to provide a practical overview for researchers interested in using it. The article shows how the method has migrated from the international relations literature to the policy‐diffusion literature, describes the typical structure of a dyadic dataset in a diffusion context, and discusses several modeling issues. The usefulness of the dyadic approach is illustrated empirically with the example of health‐insurance subsidy policies in Swiss cantons.     

Some Talk,No Action (Yet): Interdependence,Domestic Interests and Hierarchical EU Governance in Climate Policy

This article analyses why Switzerland has so far remained outside the European Union's emissions trading system (EU ETS), the centerpiece of the EU's efforts to combat climate change. In doing so, it contributes three insights to the literature on the EU's external governance. First, it shows that interdependence is of limited explanatory power in predicting EU–Swiss interactions. Secondly, it identifies domestic interests in the non‐member state, Switzerland, as the key factor in explaining the EU's external governance structures concerning emissions trading. Thirdly, it highlights the EU's limited flexibility in dealing with third countries in areas where its internal governance mode is hierarchical. The article presents a hypothesis about the future development of emissions trading in Switzerland and discusses implications for both the external governance literature and the development of global carbon markets.     

Circumventing Sovereignty: Extraterritorial Sanctions Leveraging the Technologies of the Financial System

US extraterritorial sanctions are implemented with comprehensive global reach, despite allies and adversaries opposing and rejecting them as violations of international law. I argue that this staggering reach rests on more than just the central position of the US in the global financial system, as existing accounts indicate; it builds fundamentally on the financial system’s operational autonomy. Enabled by technologies such as the ‘risk‐based approach’ and automated screening procedures, this globalized network of private actors observes its regulatory environment through its own logic. It translates sanctions into risks susceptible to mitigation beyond the political system’s territorial borders, as the cases of Switzerland and the European Union show. These jurisdictions took futile measures to defend against foreign encroachment of their authority. Unless the financial system’s increased autonomy from the state system is recognized conceptually, analyses of international sanctions will remain deficient and attempts to counter their extraterritorial reach ineffective.     

Issue Competence and its Influence on Voting Behavior in the Swiss 2015 Elections

The Liberal Radical party and – even more so – the Swiss People's party are the two winners of the Swiss 2015 election. In this contribution, we evaluate whether and to what extent issue ownership voting may help to account for the electoral success of these two parties. To that end, we distinguish the two dimensions – the associative and the competence dimension – of the concept and we rely on data from the on‐line, four‐wave panel survey carried out in the context of the Swiss election studies. Our results highlight the stability of issue ownership perceptions during the course of the campaign on the aggregate level, but they also show the substantial importance of issue ownership voting, on the individual level. More specifically, in line with earlier studies we find that competence issue ownership has a direct impact on the vote choice, whereas the impact of associative issue ownership is far more limited. For both parties under study, being seen as the most competent party on two important issues (migration and the economy) significantly contributes to the explanation of the vote choice.     

金融风暴与欧盟的应对行动协调——内在动因与主要举措述析

2008年9月始自美国的金融风暴强烈冲击了欧洲,银行系统与实体经济均遭重创。面对这场重大危机,尽管欧盟成员国最初曾试图各自应对,但在内外因素、特别是经济一体化深层结构性效应的推动下,终于决计谋求共同应对,走向了行动协调,并先后在金融市场和实体经济两大领域采取了一系列重要举措。前者主要涉及四点(1)各国的直接救市措施,旨在维护市场公平竞争秩序;(2)加强金融监管;(3)欧元区与非欧元区成员国合作;(4)强化内部协调,推动国际金融体系改革。后者则是制定了《欧洲经济复苏计划》,试图在《稳定和增长公约》框架内启动和协调各国的财政手段,迅速刺激需求和提升市场信心,以尽快推动经济复苏和就业,避免深度衰退的出现;同时,欧盟又强调以"里斯本战略"为依据,通过各种手段的协调并用,促进"结构性改革"和"聪敏型投资",推动技术创新和知识型经济发展,以提升欧洲的长远竞争力,最终促进增长和就业。欧盟在此次危机中的协调取向及各项应对举措,不但对其逐步走出当前困境,而且对日后一体化的发展进程,都将具有重要意义并产生深远影响。     

Switzerland – Really Europe's Heart of Darkness?

Immigration is a prominent and contested global topic of contemporary politics. Several recent popular votes targeting migration such as the minaret initiative, the automatic deportation initiative, and most recently the vote on “mass immigration”, evoke however the impression that Switzerland sets particularly harsh standards in migration policy. Based on historical evidence on Swiss migration policy making and comparative analyses on current cantonal integration policy outputs, I argue that ‐ while far from being a new phenomenon ‐ immigrant scepticism has become a more relevant factor of Swiss migration policy making than ever. Yet, immigration and immigrant scepticism do not only challenge direct democratic Switzerland, but all destination countries of immigration.     

Major Changes Without Regime Shifts:Switzerland and Japan in Comparative Perspective

The literature on regime shift suggests that Japan, and perhaps also Switzerland, have experienced a shift in their political systems. In this contribution, it is argued that both political systems underwent considerable change. However, this change did not represent regime shift in terms of a break with the past. Compared to other established democracies in the OECD country group, the changes to various aspects of the political systems have been similar in magnitude and type in both countries. Among OECD members, similar new elements have been layered on to stable cores of pre‐existing institutions, actor constellations and policies differing vastly in international comparison. Therewith, most countries moved in comparable directions without significantly changing their relative position within the group of established democracies     

The Impact of Municipality Mergers on Political Participation

The citizen assembly of the Swiss canton Glarus in 2006 decided to radically reduce the historical number of communes from 25 to three. Studies show that the financial and economic consequences are surprisingly small. This paper analyzes the effects on citizens' vote participation as an indicator of their political involvement. Using the difference-in-difference and the synthetic control methods, we empirically show that vote participation dropped significantly, also compared to neighboring cantons and the rest of Switzerland.     

Blurring the line between licit and illicit: transnational corruption networks in Central Asia and beyond

The anti-corruption norm in both scholarship and the policy world has too narrowly focused on the domestic and institutional context of bribe-taking and public corruption. Instead, we argue that corruption in the contemporary global economy requires a multiple set of connected transactions, processes, and relationships that take place within informal transnational networks that blur the line between illegal and legal activities. These networks include multinational companies, elites in host countries, offshore financial vehicles and conduits, middlemen and brokers, and destination financial institutions. We examine how these actors operate in Central Asia, a region that is widely identified as corrupt, yet is rarely understood as embedded in the types of global processes, offshore connections and transnational links specified in our analysis. Examples of offshore centers in tax planning from Central Asia, and partial results from a field experiment based on impersonating high corruption risks from four Central Asian states, provide evidence for how the various actors in transnational financial networks structure their dealings. We then present two brief illustrative cases of how these transnational networks have operated in energy explorations services in Kazakhstan and telecommunications contracts in Uzbekistan. Our findings have theoretical, practical, and normative implications for scholars and practitioners of Central Asian international political economy and other ‘high risk' regions.     

Steuerwettbewerb und direkte Demokratie in den Schweizer Kantonen

The issue of the impact of tax competition between the cantons has been quite present in the public discussion, especially in relation with the reform of the Swiss system of financial equalization. The connection between the degree of direct democratic rights and the intensity of tax competition ana‐lysed by Feld (1997) seems to be particularly interesting for political science. Differently to the approach of Feld (1997) this research note examines it with regard to the tax policies in the cantons. In addition, a less criticized way to measure the institutions of direct democracy is used and the research period is extended. The analysis shows that there is a trade‐off between the exit‐ and the voice‐option. In other words: those cantons that have well developed direct democratic institutions, are less affected by the pressure of tax competition. As a consequence of the perceived influence, their citizens do less probably move to an other canton as a reaction to a heavy tax burden.     

It's not Economic Interventionism,Stupid! Reassessing the Political Economy of Radical Right‐wing Populist Parties

This paper engages in a comparative analysis of the economic positions of radical right‐wing populist parties in Western Europe. Following Ennser‐Jedenastik ( 2016 ), we argue that those parties’ political economy is best captured in terms of the nativist, populist and authoritarian features of their core ideology, each of which produces a specific set of economic policies independent from the issue of government intervention in the economy. On basis of an analysis of the election manifestos of seven radical right‐wing populist parties in Western Europe in the period 2005‐2015, we argue that those parties share similarities in their economic nativism, authoritarianism and populism, whilst their positions on the traditional role of the state in the economy are more diverse. The findings indicate also a unified ‘nativist’ response to the global financial crisis both in terms of welfare chauvinism and economic protectionism. We discuss the role of internal and external factors in explaining the economic profile of radical right‐wing populist parties.     

What explains the Differences in the Tax Burden Between Swiss Cantons?

In the present article, we empirically analyse a series of competing hypothesis that try to account for the considerable disparity in the tax burden between Swiss cantons. Three hypotheses focus on differences in spending levels: The first explains differences in the tax burden with differences in citizens' demand for government services. The second emphasizes the differences in efficiency between cantonal administrations, whereas the third insists on the more or less easy access to cantonal instruments of direct democracy. However, when confronted to the data, none of these three expenditure‐based hypotheses are confirmed by our cross‐sectional estimations. On the contrary, our regressions lend support to the hypotheses which highlights the differences in tax revenues between cantons. These results suggest that it is not differences in government spending which account for the disparity in cantonal tax levels, but differences in the cantonal endowment with resources. This indicates that some financial equalization on the cantonal level might strengthen the equity of Switzerland's tax system.     

Norfolk Island and Its Tax Haven

The first Pacific Islands offshore financial centre was born in 1966 on Norfolk Island. This paper analyses the historical trajectory of Norfolk Island's tax haven in terms of its dialectical tensions with the Australian federal government — tensions between self-determination and subordination which emerge from Norfolk's anomalous status as a self-governing external territory of Australia. Promoters of Norfolk Island's tax haven have seen its potential to become a major global offshore financial centre blocked by the Australian federal government. Yet, at major critical junctures (in 1976, 1991 and 2000) the Australian federal campaigns that threatened Norfolk's residential tax haven disintegrated in the face of concerted local opposition, although the danger has never entirely disappeared. The island's political economy and external relations are likely to remain inextricably bound to its tax haven.     

Swiss Air Traffic Policy: Noise between Berne and Berlin

This article looks at the negotiations between Switzerland and Germany on air traffic regulation with the help of negotiation analysis tools. A number of factors pre‐eminent in the literature on negotiation processes and outcomes are presented and critically assessed. In particular arguments of “power”, which are often insufficiently explored in analysing interstate cooperation, are brought back into the picture. The article argues that structural power best explains the negotiation results while domestic politics and information asymmetries both account for non‐ratification of the treaty. Institutionalist arguments on the constraining effects of international norms and institutions as well as explanations focusing on negotiation skills are of minor importance. Moreover, the nature of the Swiss intra‐governmental setting at the federal level did not encourage the Swiss negotiators to exploit all means during the different stages of the bargaining process. The article concludes by illuminating a number of policy observations in the broader context of Swiss foreign relations and indicating avenues for further research.     

L'effet des rapports financiers sur la dynamique fédérale: la qualité médiative du fédéralisme suisse

The article examines the horizontal and vertical fiscal relations as explanatory factors of the interaction dynamics between levels of government in Switzerland. It presents the intergovernmental financial relations in Switzerland, comparing them to those in other federal countries and outlining the current reforms of the equalization system and the distribution of tasks. The author analyzes the effect the fiscal relations have on the intergovernmental interaction dynamics and discusses the potential implications of the current reforms for Swiss federalism. She demonstrates that the interaction dynamics that result from the financial relations are characterized by compensation, multilevel coordination and more rarely by unilateralism. The transformation of the financial relations that result from the current reforms, in particular the weakening of existing coordination structures, may lead to increased unilateralism and thus reduce the mediative capacity of Swiss federalism. Yet, the reform process also shows how durable the complex coordination structures are, which should be eliminated by the reforms.     

Challenges to Intergovernmental Relations in Switzerland and Japan

In comparing Switzerland and Japan with respect to intergovernmental relations, differences are more obvious than similarities. Switzerland is a strongly federalist country. In contrast, Japan was clearly centralist in the past, and despite continuing decentralization reforms, it is usually still considered to be so today. The influence of the lower levels of government on the national legislative process remains comparatively low in Japan. Its centralized political structure seems to fit Japan's homogeneous culture, while on the other hand Swiss federalism has proven to be apt for the integration of minorities and for respect of cultural diversity. In spite of obvious basic differences, intergovernmental relations in these two countries face similar challenges: the concentration of human and economic resources in urban areas, the weakening of sub‐national parliaments, and financial strain.     

Collegiate Executives and Direct Democracy in Switzerland and Uruguay: Similar Institutions,Opposite Political Goals,Distinct Results

Uruguay, defining itself as the “Switzerland of Latin America”, took the Swiss model (collegial executives and direct democracy) as an example when building its own political institutions. Despite the similarities of these institutions, the results were quite different due to the different context. The comparison between the institutions in these two isolated countries highlights the ways in which the same institutions may produce different results and evolve in distinctive ways. This is important to recognize as foreign models and experiences continue to inspire policies. Contrary to common arguments presented in the literature, even in such a “most likely case”, institutions cannot simply be copied. Institutional effects are context‐dependent and we need to pay attention to this interaction. This article provides new evidence showing that universalist institutional arguments can be misleading.     

From Armed Neutrality to External Dependence: Swiss Security in the 21st Century

Abstract: Historically, Swiss identity was founded on beliefs in federalism, direct democracy and armed neutrality. Given continued popular support for autonomous self‐defense in an era of transnational threats, it is worth examining whether a small economically interdependent state, such as Switzerland, is single‐handedly capable of providing for its own security. To preview our conclusions, every facet of Switzerland’s security, whether against military threats, terrorism or natural disasters, today benefits from substantial international inputs. At base, Switzerland’s increasing security dependence has been driven by the following dynamics: 1) the general development of institutionalized international cooperation; 2) the evolving nature of the threats Switzerland faces; and 3) political efforts to “securitize” issues not hitherto considered as security problems. Because Swiss security dependence owes more to broad structural factors than deliberate choices, policymakers would be better off embracing this reality by proactively using international organizations to address transnational challenges.     

金融安全视角下的欧盟数字资产监管策略

数字资产创新为欧盟金融业发展带来希望,也给其金融安全带来挑战。从最初的虚拟货币(加密货币)到虚拟资产(加密资产),再到全球稳定币;欧盟面临的金融安全风险也从洗钱/恐怖主义融资对区域安全的危害,演变到对金融体系稳定运行的不利影响,再到对货币主权、支付主权构成的挑战。欧盟在数字资产监管过程中充分权衡创新收益与安全风险,在金融体系安全维度循序渐进地加强监管措施,在金融主权安全维度加紧建立数字稳定币监管法规并推动自身数字货币解决方案,在与金融手段相关的其他安全维度果断立法打击利用数字资产开展的恐怖主义融资活动。