The Impact of Foreign Direct Investment (FDI) Inflows on Economic Growth in Barbados: An Engle-Granger Approach

The purpose of this article is to look at the impact of foreign direct investment (FDI) inflows on economic growth in Barbados in the long and short run from 1979 to 2008 with the use of the Engle-Granger two-step procedure. The study shows that in the long run, a 1 percent increase in FDI inflows will expand economic growth by 0.10 percent while in the short run, the relationship between FDI and economic growth will be positive but almost flat. These results imply that any policy by Government aimed at boosting economic growth using FDI inflows will have to be considered for the long run since Government could not rely on FDI inflows in the short run.     

Open Government Information: Challenges Faced by Public Human Resource Management in China

The implementation in China of the Regulations of the People's Republic of China on Open Government Information, on May 1, 2008, is considered a potential turning point, a shift from traditional public administration characterized by an entrenched culture of secrecy toward more transparent and accountable administration practices. This article shows, however, that due to a variety of institutional constraints, the implementation of the Regulations is still lacking. Although the success of an open government information (OGI) regime in China ultimately relies on thorough political and administrative reforms, this article presents the argument that short of drastic political system change, the implementation of the Regulations could be improved by adopting innovations at the management level. This article suggests that the Chinese government adopt new human resource management strategies in leadership, training, and performance management that are compatible with OGI in order to significantly improve the implementation of the Regulations. An incremental approach to improving OGI implementation in China will finally pave the way for future political reform.     

The Determinants of Local Government's Financial Transparency

This paper contributes to the scarce literature on government transparency by analysing the impact of political and socio-economic factors on municipal financial transparency. Our sample covers the 100 largest Spanish municipalities in 2008. Compulsory publicity and transparency are key to public management (rule-of-law theory). Our data show that Spanish municipalities are providing financial information beyond the legal requirements, thus exceeding the compulsory disclosures required by the rule-of-law theory. The more taxes and more transfers per capita, the more financial information is disclosed and, accordingly, the higher the transparency is. Therefore the municipalities are not taking advantage of fiscal illusion or principal–agent effects, since they are not concealing higher levels of taxes and transfers from citizens. Furthermore, left-wing parties are more transparent than right-wing ones. Finally, the population also has a positive effect on the achievement of financial transparency.     

Fiscal Capacity Equalisation in Tanzania

Fiscal equalisation aims at enabling decentralised governments to supply similar services at similar tax rates. In order to equalise fiscal disparities, differences in both fiscal capacities and in fiscal needs have to be measured. This paper focuses on the measurement of fiscal capacity in a developing country. The current intergovernmental transfer system in Tanzania does not take differences in fiscal capacity into account. As a result, local governments in rich areas are able to generate considerably more revenue per capita than those in poor areas. Public services in poor areas are hard to finance. We propose a way of measuring fiscal capacities of local governments in Tanzania using poverty data. We use this measure to derive an equalisation grant that would support local governments that have a low fiscal capacity.     

The Flypaper Effect: Do Political Institutions Affect Danish Local Governments’ Response to Intergovernmental Grants?

Abstract

Despite a large number of empirical studies on the flypaper effect, it remains disputed whether the effect exists and to what extent it is asymmetrical. The flypaper effect suggests that intergovernmental grants tend to result in higher increases in public expenditures than a similar increase in citizens’ private income would have led to. An asymmetrical effect exists when the fiscal response differs depending on whether grants are increased or decreased. By considering political institutions that moderate the effect of intergovernmental grants, this article offers a theoretical explanation that accounts for the mixed empirical evidence. The local response to intergovernmental grants is tested using a reform of the Danish intergovernmental grant scheme in 2007. In line with the expectation, the article finds a strong asymmetrical effect, but more surprisingly, this effect is found both when subnational budget institutions are centralised and when they are fragmented.     

Political Fragmentation and Fiscal Status: Evidence from Municipalities in Israel

Abstract

This article analyses the link between fiscal balance and political fragmentation. While a large body of literature states that political fragmentation leads to fiscal deficits, others suggest that political fragmentation is associated with political competition, which tends to improve fiscal balance. These hypotheses are tested using budgetary and political data of municipalities in Israel for the years 1998–2006. The results suggest that both hypotheses may be correct, depending on voting behaviour. In Arab municipalities, where residents vote according to clan affiliation, low levels of political fragmentation are associated with large debts. On the contrary, in Jewish municipalities, low levels of political fragmentation are associated with small debts, since in these cases, coalition formation requires less spending and is easier to sustain.     

By‐laws of I.A.I.

The launch of the Eastern Partnership (EaP) marks the most significant change to the European Neighbourhood Policy (ENP) since it was launched in 2004. In the wake of the Georgia war in August 2008 and yet another gas crisis in January 2009, the EU clearly needs a more constructive policy towards Eastern Europe. But both the ENP and EaP are based on a contradiction. They offer only the remotest possibility of eventual accession to the EU, but are still based on “accession-light” assumptions, applying the conditionality model of the 1990s to weak states that are a long way from meeting the Copenhagen criteria. The priority in the eastern neighbourhood is not building potential members states but strengthening sovereignty, in the face of an increasingly assertive Russian neighbourhood policy. The game is playing the west off against Russia for geopolitical reward.     

Striking a pose: Transparency and position taking in the Council of the European Union

In recent years, transparency (or the lack thereof) has become a central concern of the European Union and its attempts to increase the democratic legitimacy of the legislative decision‐making process. The claim regularly made is that increasing transparency increases the potential for holding decision makers to account. This study investigates the manner in which transparency in the decision‐making process affects the policy positions taken by negotiators at the outset of negotiations. The findings presented suggest that increasing transparency tends to lead to polarisation of negotiations, with negotiators taking more extreme positions when they know that their positions can be observed by outside parties. The implication of this result is that advocates of transparency should be aware that there is an inherent trade‐off between increasing transparency, on the one hand, and increasing the incentives to grandstand during negotiations, on the other.     

The debate on a regional arms register in Southeast Asia

Abstract

ASEAN member states are no longer opposed in principle to military information sharing and the ASEAN Regional Forum (ARF) is now actively considering ideas for new confidence‐building measures in this area. The first specific transparency measure supported by ARF was the UN Register of Conventional Arms, whose success in the region has been a result, at least in part, of its flexibility. Because of the limited scope of the UN Register, debate has continued on the possibility of a regional Register. As this debate has proceeded, however, it has become apparent that the creation of such a Register will require a number of complex and difficult issues to be resolved. What additional data should such a Register include? Who should be responsible for operating such a Register? Which countries should be included? Because of these difficulties, the prospects of a regional Register being established in the near future are rather slender. But, as they become more comfortable with the concept of transparency, there is still considerable scope for ARF members to do more to adopt regional ‘best practice’ in their replies to the main UN Register. The Register formula of framework plus flexibility could also be used as a model for the development of parallel transparency arrangements in areas other than arms transfers. The experience of the Register debate suggest that the development of concrete confidence‐building measures in the ARF region is likely to be a gradual process. Progress is possible, but is unlikely to transform levels of national openness on military affairs overnight. The main obstacles to increased transparency may prove to be domestic and political rather than international and military: demonstrating once again the way in which the confidence‐building agenda is linked to broader debates about the necessary political foundations of a secure regional order.     

Model for Management of Public Funds Transfers in SICONV

This article consolidates the efforts of the Information Systems Research Group for the construction of a reference model for the management of agreements celebrated based on the Brazilian federal government＇s voluntary funds transfers. It presents the Reference Model for covenants＇ processes, which is the product of the third phase of this research project. This model will be used as reference in the fourth phase of this project, when it will be applied to a sample of covenants. Experience gained in this step will allow the consolidation of the Reference Model. An important contribution of this work is to facilitate the understanding of proposals, so processes analyzed can be improved and redesigned. Processes information, from organization to details of each activity, can then be disseminated to all interested parties. Results here presented are not final. They will serve as input to the next stage of the project, which is the Assessment of the Reference Model by selected Stadual and municipal governments. Each entity will contribute with its own perspective to improving the idealized model.