How should large and small countries be represented in a currency union?

We present a simple model of optimal representation in a federal central bank that balances two opposing forces: the wish to insulate common monetary policy from changing preferences at the national level, and the attempt to avoid an overly active or passive reaction to idiosyncratic national economic shocks. A perfect match between economic size and voting rights is rarely optimal, and neither is the “one country, one vote principle”. There are indications that the pattern of over- and under-representation of member countries in the ECB Council might be extreme.     

Fair Trial Rights and the European Community's Fight Against Fraud

The article surveys action taken by the European Community to combat fraud affecting its financial interests, focusing on the development of investigative authority granted to OLAF, the European‘Office Pour La Lutte Anti Fraude’ and its impact on the procedural rights of the alleged defrauder. It shows that the involvement of OLAF can be crucial for a national fraud investigation and subsequent criminal prosecution and that it meets the criteria set out by the Strasbourg organs for the applicability of Article 6 ECH. The article explores whether the legal sources governing the activities of OLAF or national—or rather, Community—law guarantee sufficient protection for the alleged defrauder and thus pay respect to principles arising from the rule of law in law enforcement. It is shown that general principles of Community law, which were mostly established in antitrust law, may provide a certain protection for the suspect, but may not protect him in all regards. It is thus argued that, in the long run, it will be necessary to provide special fair‐trial rights which offer protection to alleged defrauders from those infringements arising out of the specific features of a Community investigation.     

How Can Weak Insurgent Groups Grow? Insights From Nepal

How can insurgent groups that are militarily far weaker than the state survive and grow? Influential accounts drawing on Kalyvas' “control-collaboration” model argue that limited state reach can make this possible by allowing rebel groups to carve out pockets of control where they can elicit collaboration. I suggest that this account is inadequate. Even states with limited reach are likely to transfer sufficient forces to rebel-affected areas to establish at least partial control. Weak rebels therefore often face the challenge of building capacity without local control to begin with. I identify two broad factors that can make this feasible: first, strong pre-existing rebel networks, which facilitate collaboration through solidarity, norms of reciprocity, and social incentives; and second, counterinsurgency policies and practices that fail to exploit the opportunities that control offers for incentivizing collaboration and shaping political preferences. These arguments are grounded in a fieldwork-based case study of insurgency processes in a hamlet of Rolpa, Nepal.     

Cultivated ties and strategic communication: do international environmental secretariats tailor information to increase their bureaucratic reputation?

International Environmental Agreements: Politics, Law and Economics - The past few years have witnessed a growing interest among scholars and policy-makers in the interplay of international...     

The Benevolent Prince in Veit Ludwig von Seckendorff’s <Emphasis Type="Italic">Teutscher Fürsten Stat</Emphasis> with Special Consideration of the Prince’s Revenues,Regalia and Taxes

The applicability of Transaction Cost Economics (TCE) to the public sphere is examined with the use of institutional legal theory. First, Oliver E. Williamson's 1985 general theory of private governance structures is analyzed. Following on this, his 1999 attempt at extending the theory to capture governance structures in the public sphere as well, is analyzed with the use of the insights gained from the first stage. Finally, on the basis of the whole two-stage analysis, an attempt is made at solving some fundamental problems concerning the applicability of TCE to public governance. JEL Classification: B52, D73, H11, K0, L22, L33     

Optimal central bank design: Benchmarks for the ECB

The paper discusses key elements of optimal central bank design and applies its findings to the Eurosystem. A particular focus is on the size of monetary policy committees, the degree of centralization, and the representation of relative economic size in the voting rights of regional (or sectoral) interests. Broad benchmarks for the optimal design of monetary policy committees are derived, combining relevant theoretical arguments with available empirical evidence. A new indicator compares the mismatch of relative regional economic size and voting rights in the monetary policy committees of the US Fed, the pre-1999 German Bundesbank, and the ECB over time. Based on these benchmarks, there seems to be room to improve the organization of the ECB Governing Board and current plans for reform.      

Fighting fiscal corruption: lessons from the Tanzania Revenue Authority

Over the last decade, several African countries have undertaken comprehensive reforms of their tax administrations to increase revenue and curb corruption. This article examines recent experiences in the fight against corruption in the Tanzania Revenue Authority (TRA). Two lessons of broader relevance are highlighted. Firstly, even with relatively high wages and good working conditions, corruption may continue to thrive. In a situation where there is high demand for corrupt services, it is unrealistic to provide tax officers with pay rates that can compensate for the amount gained through bribery. Without extensive and effective monitoring, wage increases may produce not only a highly paid, but also a highly corrupt tax administration. Secondly, hiring and firing procedures may lead to more corruption. Corrupt tax officers often operate in networks, which also include external actors. These corruption networks seem to have been strengthened because many of those fired were recruited to the private sector as ‘tax experts’. This partly explains why the positive process experienced in the initial phase of the new revenue authority was later reversed. Copyright © 2003 John Wiley & Sons, Ltd.     

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