What is a service of general economic interest?

European Journal of Law and Economics - The definition of the concept a “service of general economic interest” (SGEI) known from Article 106(2) treaty of the functioning of the European...     

The devil lies in the definition: competing approaches to fossil fuel subsidies at the IMF and the OECD

Fossil fuel subsidy reform has in recent years been addressed by international economic organizations including the International Monetary Fund (IMF) and the Organisation for Economic Co-operation and Development (OECD). The two organizations have differed significantly in how they define fossil fuel subsidies. The IMF’s definition constitutes a radical break with previous definitions by including environmental externalities, while the OECD’s is more conventional. The article explores the factors that explain why these international economic organizations have approached fossil fuel subsidies so differently. The exact definition of fossil fuel subsidies is contested. Furthermore, fossil fuels subsidies can be framed in ways that emphasize, respectively, their macroeconomic, fiscal, environmental, and distributive consequences. The article finds that institutional interaction lifted OECD involvement in fossil fuel subsidies to a new level, whereas the impetus to address fossil fuel subsidies within the IMF came largely from the IMF staff. In both cases, the organization’s bureaucracy constituted the most important factor shaping how the organizations addressed such subsidies and hence the main reason why they differ in how they approach fossil fuel subsidies.     

Limiting costs or correcting market failures? Finance ministries and frame alignment in UN climate finance negotiations

Finance ministries are increasingly involved in UN climate finance negotiations, yet this development received very limited attention in the literature on climate finance or climate negotiations. It is not obvious from the literature on bureaucratic politics how these ministries will position themselves on climate finance: they may frame climate finance as expenditure to be limited or as an instrument for correcting the market failure of climate change. This paper investigates which frames have characterised the positions of finance ministries on key issues in the climate finance negotiations, and whether the use of a given frame corresponds to particular factors. Case studies of Denmark, India, Indonesia and the USA based on official documents and interviews show that the position of each finance ministry is generally consistent with one particular frame. The Indonesian and Danish finance ministries predominantly framed climate finance as a way of correcting a market failure. The Indian Ministry of Finance emphasised Common but Differentiated Responsibilities, which fits with the budget frame. The US Treasury’s position similarly fits with the budget frame while sharing elements of the market failure frame. Finance ministries that had the lead on climate finance were more likely follow the budget frame. The use of both frames cuts across the divide between industrialised and emerging economies. With the exception of the USA, left- and right-wing governments were equally likely to adopt either frame. These findings indicate that strengthening finance ministry forums built around the market failure frame can be a way of reducing norm fragmentation.