The introduction of professional regulation and labor market conditions

There has been increasing concern by policy makers about the impact of occupational regulation and the process by which it is introduced. This paper examines the introduction of mandatory licensure laws to replace public certification of registered nurses at the state level. Historical analysis supports the hypothesis in economic models that small groups with concentrated interests like occupations will dominate the introduction of laws and suggests examining changes in labor market conditions may be useful in predicting future demands for legislation. Estimates of an empirical model of the diffusion of licensure across states for nurses suggests this type of quality assurance regulation was introduced first where the quality of services was probably already relatively high and that policies reducing the impact of licensure on geographical mobility may reduce pressure for new laws. Patterns in the introduction of laws also have implications for evaluating their impact.     

Determinants of Pro‐Fracking Measure Adoption by New York Southern Tier Municipalities

New York municipalities passed more than 60 measures promoting high‐volume hydraulic fracturing (HVHF), 2008–12. These policies and resolutions signaled to state officials that municipalities desired HVHF's promised economic benefits and were anxious for an end to the state's HVHF moratorium. They also may be evidence of municipalities proactively preparing for a drilling boom. Why did some jurisdictions adopt these measures while others did not? While scholarship suggests that policy adoption is facilitated when jurisdictions and citizens possess more resources, capacity appears to have a negative or negligible impact on pro‐HVHF action. Such action appears more likely when local actors anticipate HVHF's potential gains but have not previously experienced substantial drilling, perceive that the industry could be viable locally, and can access relevant policy examples. Some lessons from conventional adoption scholarship may not apply when policies are symbolic, advocacy may be elite‐driven, and mimicry is an important diffusion mechanism.     

Interstate Banking: Current Status and Unfinished Agendas

In 1986, most of the centuries-old barriers against interstatebranch banking fell. By the end of the year, thirty-seven stateshad passed legislation authorizing some form of interstate branchbanking. Moreover, two federal judicial decisions had clearedthe way for interstate banking by restricting state regulatoryauthority over interstate branch banking when it is conductedeither through a shared-use automatic teller machine or by a"nonbank bank." These developments have dramatically changedthe nature of the business of banking, creating an entirelynew legislative agenda for states. High on the list of the itemsthat states must now consider are regulatory and tax parityamong competing financial institutions; multiple taxation offinancial institutions that do business in several states; taxavoidance by out-of-state banks; and out-dated jurisdictionalstandards.     

Transparency, Democratic Accountability, and the Economic Consequences of Monetary Institutions

Debates about the appropriate mix between autonomy and accountability of bureaucrats are relevant to numerous areas of government action. I examine whether there is evidence of a tradeoff between transparency, democratic accountability, and the gains from monetary delegation. I begin by presenting a simple theoretical model which suggests that central banks that are transparent, in the sense of publishing their macroeconomic forecasts, will find it easier to acquire a reputation. Despite making central banks more subject to outside scrutiny then, monetary transparency can lead to improved economic outcomes. I also consider arguments about the effect of accountability provisions involving parliamentary oversight and control over central bankers. The article then uses a new data set to examine these issues empirically, focusing on a natural experiment involving disinflation costs under different central banking institutions during the 1990s. Results suggest that countries with more transparent central banks face lower costs of disinflation while accountability provisions have no clear effect on disinflation costs. My results also concord with earlier findings that the effect of monetary institutions is conditional on other features of the political environment.     

Isolating the effect of compulsory voting laws on political sophistication: Leveraging intra-national variation in mandatory voting laws between the Austrian Provinces

Compulsory voting laws introduce a legal requirement to vote that substantially increases in voter turnout. Additionally, this study provides evidence that a legal requirement to vote also generates a more politically informed population. A comparative case study leverages intra-national variation in mandatory voting regulations across the Austrian Provinces over time. The analysis constructs novel measures intended to quantify recent and accumulated exposure to compulsory voting laws. The results suggest that exposure to mandatory voting laws caused Austrian citizens to increase their political interest and attention to political news, as well as their level of information about party platforms on whether or not to expand EU integration. As a whole, the study suggests that compulsory voting not only increases voter turnout; it also leads to an increase in political information.     

Pain Management and Work Capacity: Evidence From Workers’ Compensation and Marijuana Legalization

We study whether the work capacity of the older working population responds to improved pain management therapy access. We use the adoption of state recreational marijuana laws (RMLs) as a large policy shock to access to a non-pharmaceutical pain management option. We focus on workers’ compensation cash benefit receipt as a measure of work capacity, finding that receipt declines in response to RML adoption. Workers’ compensation cash benefits are awarded to workers who require time away from work to recover from an injury, which arguably captures a policy-relevant aspect of work capacity. We observe similar shifts in complementary proxies for work capacity, including work-limiting disability rates. After considering a range of alternative mechanisms, the evidence suggests that the primary driver of the reductions in workers’ compensation benefits is improvements in work capacity.     

Visibility and facticity in policy diffusion: going beyond the prevailing binarity

Quantitative-oriented diffusion studies, either focused on diffusion patterns or mechanisms, take for granted that policy adoptions are manifest and therefore directly observable in the legislation. A more nuanced perspective of policy adoption taking into account gradual differences between adoption and non-adoption is proposed with this paper, valid for diffusion among communities and states in federal settings and among countries on the global level. Besides the aspect of visibility, intentions are also important when measures are adopted. While some measures are transferred with a clear instrumental aim, others are rather transferred for symbolical reasons. Looking at specific processes, the paper proposes a concept that disentangles the current understanding of policy diffusion and provides empirical evidence that current diffusion research misconceives instances. The four different transfer types are illustrated with empirical evidence from sub-national energy policy-making in Switzerland. The systematic investigation of the cases allows to finding explanations for the different transfer types.     

Regulatory lags,liberalization, and vulnerability to banking crises

This article explores the effect of delays in updating prudential regulation on the likelihood of a country experiencing banking crises, and it disentangles the impact of different aspects of regulation on crisis onset. I argue that delays in revision to banks' prudential regulation allow banks to adopt risky behavior, which increases a country's vulnerability to systemic banking crises. This effect, however, is conditional on the level of liberalization of the financial market. At lower levels of liberalization, banks have stronger incentives to escape the constraints of regulation and to take advantage of regulatory lags. At high levels of liberalization, the effect of regulatory lags is curbed, possibly by market discipline. Statistical analyses on a sample of developed and developing countries from 1974–2005 support this argument and help rule out the competing learning hypothesis. These results suggest that the effects of institutions can vary with the passage of time.     

It Takes a Village: Peer Effects and Externalities in Technology Adoption

Do social networks matter for the adoption of new forms of political participation? We develop a formal model showing that the quality of communication that takes place in social networks is central to understanding whether a community will adopt forms of political participation where benefits are uncertain and where there are positive externalities associated with participation. Early adopters may exaggerate benefits, leading others to discount information about the technology's value. Thus, peer effects are likely to emerge only when informal institutions support truthful communication. We collect social network data for 16 Ugandan villages where an innovative mobile-based reporting platform was introduced. Consistent with our model, we find variation across villages in the extent of peer effects on technology adoption, as well as evidence supporting additional observable implications. Impediments to social diffusion may help explain the varied uptake of new and increasingly common political communication technologies around the world.     

The political economy of inflation: Bargaining structure or central bank independence?

The causes of inflation are commonly analyzed as the function of either the organization of wage bargaining or the independence of the central bank. Although these explanations are widely treated as competing, recent evidence suggests that there may be merit to both arguments. This paper presents a game-theoretic model of wage bargaining and monetary policy-making that shows why the two institutional causes are not only complementary, but elements of a more encompassing logic. The empirical superiority of this synthesizing model is demonstrated by reanalyzing data used in Al-Marhubi and Willett (1995) and by presenting new evidence.     

Erratum: The Political Economy of Inflation: Bargaining Structure or Central Bank Independence?

The causes of inflation are commonly analyzed as the function of either the organization of wage bargaining or the independence of the central bank. Although these explanations are widely treated as competing, recent evidence suggests that there may be merit to both arguments. This paper presents a game-theoretic model of wage bargaining and monetary policy-making that shows why the two institutional causes are not only complementary, but elements of a more encompassing logic. The empirical superiority of this synthesizing model is demonstrated by reanalyzing data used in Al-Marhubi and Willett (1995) and by presenting new evidence.     

A general equilibrium model of two group conflict with endogenous intra-group sharing rules

This paper explores the interactions among intra-group sharing rules, the competition between two groups over the common pool of output, and the allocation of resources between productive and appropriate activities. In the interior solution, the use of egalitarian method for the distribution of group income among members plays no distributional role but only affects the allocation of resources. It releases resources into the productive sector from the group that adopts the egalitarian rule by making the internal conflict among the members less intense. The sequential choice of intra-group sharing rules and resource allocations produce the adoption of fully egalitarian intra-group sharing rules in both groups. These rules minimize the amount of resources allocated to appropriate activities and maximize the welfare level of all individuals in the economy. This result suggests that inter-group competition with the use of egalitarian principle in the distribution of group income among group members, which is not available to the Hobbesian state of nature, is one of the cheaper social devices in restraining individuals from engaging in costly appropriative activities.     

Understanding America's Hesitant Steps Toward Financial Capitalism: Politics, the Depression, and the Separation of Commercial and Investment Banking

Few would disagree that the Glass-Steagall Act of 1933 is thecontinental divide in American financial and banking history. Bydisallowing banks from getting involved in the investment bankingindustry, this Act imposed an institutional change that shaped howfinancial institutions conduct their business, even today in itsdecline. Conventional wisdom has it that the Act was enacted tocorrect the ``deficient'' financial system that existed during theperiod. In this paper we investigate whether this assertion can beempirically verified by analyzing the Senate vote on a predecessorof this Act (which included the clause separating commercialbanking from investment banking activities). Using multinomiallogits, we examine what may have motivated senators to vote for itspassage. The econometric evidence indicates that the Senate votewas significantly influenced by important interest groups(including national banks as well as manufacturing sectorinterests), despite the large populist outcry for financial marketreforms at the onset of the Depression.     

Competing loyalties in electoral reform: An analysis of the U.S. electoral college

A central tenet in the electoral systems subfield is that parties, when in power and motivated by partisan interest, seek desired outcomes via the strategic adoption of electoral rules. Such a focus, however, omits a key point: electoral rules also distribute power among geographic units. If, within a party, the partisan and geographic interests of some members conflict, then the canonical relationship between partisanship and rule choice may be conditional. The U.S. electoral college provides an opportunity to test for such intra-party variation, because it advantages some states over others and thus makes salient geographic allegiances. Using an original dataset on one reform proposal—the National Popular Vote Interstate Compact (NPVIC)—I find evidence of competing loyalties. Although NPVIC advances furthest when Democrats control state lawmaking, a state's status as a swing—but not as an overrepresented—state weakens the relationship to the point where even Democrats are unlikely to aid NPVIC.     

Medicaid matters: children's health and Medicaid eligibility expansions.

In the late 1980s, a series of federal laws were enacted which expanded Medicaid eligibility to more of the nation's children. States had a great amount of discretion in how fast and how far these expansions were implemented. As a result, there was great variation among the states in defining who was eligible for the program. This variation provides a rare opportunity to disentangle the effect of Medicaid from a child's socioeconomic status. Using data from the National Health Interview Survey, we address whether the Medicaid expansions improved the health and functional status of children. Econometric models were developed using fixed-effects regressions, and were estimated separately for white, black, and Hispanic children. White children experienced statistically significant reductions in acute health conditions and functional limitations. Black and Hispanic children showed some evidence of improved health conditions and functional status, but this evidence is inconclusive in the study sample. This may be due to differences in their access to appropriate health services or to the smaller sample size of minorities in each geographic area. The findings are also relevant to the implementation of the Children' Health Insurance Program (CHIP), the latest federal effort to expand access to health care to poor and near poor children. In many states, CHIP is being implemented in whole or in part through further Medicaid expansions.     

The Adoption of Local Option Fuel Taxes: Evidence From Florida Counties

This study examines the time to adoption of local option fuel taxes (LOFTs) among Florida counties from 1972 to 2015. Florida county governments are authorized to levy up to 12 cents of LOFTs in the form of three separate instruments. Using a Cox proportional hazards model, this study finds that additional LOFT instruments in place affect time to adoption and that the factors associated with the adoption of LOFTs differ from those of local option sales taxes. Additionally, there is evidence that suggests the legal structure of LOFTs affects both the time to adoption and the relationship with other LOFTs.     

Intraparty Hostility: Social Identity,Subidentity, and the Hostile Media Effect in a Contested Primary

The hostile media effect (HME) has generally been tested in terms of in-groups and out-groups, with a “neutral” story in between. This ignores the nature of many social groups as comprising subgroups, often but not always sharing feelings of connectedness and purpose. In cases when bounded subgroups are at odds with one another, HME provides little guidance. A contested partisan primary provides such a case. This study takes identity centrality, candidate favorability, and perceived social network homogeneity as measures of partisanship and involvement, hypothesizing relationships between each and perceived bias against one’s candidate and party. Findings show that markers of candidate-focused social identity predict greater perceived bias against one’s candidate during the 2016 primary season, while party-focused identity fails to predict perceived bias against one’s party. This suggests that candidate support identity overrides plain partisanship during primaries, supporting concern that a heated primary might damage general election party unity. Subsequent postconvention findings suggest that the salience of candidate-focused identity fades, while homogeneity of one’s network regarding party support helps to make perceived hostility toward one’s party identity more salient. However, as campaigns become more candidate-centered, the contestation between nested candidate and party identities may grow fiercer.     

Why preferences and institutions change: A systematic process analysis of credit rating in Germany

This article argues that a within‐case analysis of the causes and patterns of the institutionalisation of rating in the German financial system offers fresh insights into change in the major socioeconomic institutions of advanced capitalism. Using the method of systematic process analysis, the article explores the expansion of credit rating in the German banking system from three perspectives: historical (power), sociological (diffusion) and behavioural institutionalism (prospect theory). It demonstrates that the proliferation of credit rating resulted from a change of preference on the part of large banks. With Germany as a least likely case for successfully implementing rating, the study's main lesson is that institutional analysis may benefit from incorporating behavioural institutionalism into the analysis of preference change because this cites economic motivations as causes of preference shifts and institutional changes.     

Adoption of the UN Global Compact in Spanish banking: a case study

The aim of this work is to analyse the process involving adoption of a corporate social responsibility initiative—the United Nations Global Compact—in a Spanish financial institution. Semi‐structured interviews were conducted for such purpose with managers, workers and customers from this organisation. From the analysis carried out, it can be ascertained that only professionals from the specific field of corporate social responsibility in the organisation being analysed have suitable knowledge about the initiative adopted, while the other professionals are practically unaware of it—even among professionals such as accountants who should clearly have suitable knowledge about the subject in order to draft sustainability reports. As a result, the research also provides evidence about the ceremonial adoption of the United Nations Global Compact, highlighting the internal friction existing within an organisation that until very recently stood out in the Spanish banking sector for the amount of externally obtained awards in recognition of its sustainability practices. Copyright © 2016 John Wiley & Sons, Ltd.     

The IMF's Rethink of Global Banks: Critical in Theory,Orthodox in Practice

The International Monetary Fund's (IMF) new financial interconnectedness agenda, developed in response to postcrisis calls from G20 to better understand systemic financial institutions, deploys a critical approach that stresses the spatial, political, and institutional dimensions of cross‐border financial networks. It portrays global banks as key nodes in those networks, “super‐spreaders” of systemic risk through complex business models that involve yield search, regulatory and tax arbitrage. Yet this critical view does not translate into its policy advice at country level. In regular surveillance of developing countries, the IMF remains committed to a benign view of transnational banking, even when confronted with growing cross‐border fragilities. During crises of cross‐border banking, the IMF tailors its conditionality to minimize domestic regulatory challenges to cross‐border banking models and to propose crisis measures that create new profit opportunities for transnational banks.