The New Political Economy of the Macroprudential Ideational Shift

From late 2008 onwards, in the space of six months, international financial regulatory networks centred around the Swiss city of Basel presided over a startlingly rapid ideational shift, the significance and importance of which remains to be deciphered. From being relatively unpopular and very much on the sidelines, the idea of macroprudential regulation (MPR) moved to the centre of the policy agenda and came to represent a new Basel consensus, as the principal interpretative frame, for financial technocrats and regulators seeking to diagnose and understand the financial crisis and to advance institutional blueprints for regulatory reform. This article sets out to explain how and why that ideational shift occurred. It identifies four scoping conditions of presence, position, promotion, and plausibility, that account for the successful rise to prominence of macroprudential ideas through an insiders' coup d'état. The final section of the article argues that this macroprudential shift is an example of a ‘gestalt flip’ or third order change in Peter Hall's terms, but it is not yet a paradigm shift, because the development of first order policy settings and second order policy instruments is still ongoing, giving the macroprudential ideational shift a highly contested and contingent character.

International mortality modelling- an economic perspective

A recent literature has developed on modelling mortality in multiple populations together. The purpose of this paper is to suggest a reason why mortality in different populations may be related based on an economic literature on technology and knowledge diffusion.

Forecasting Death Rates Using Exogenous Determinants

Mortality models used for forecasting are predominantly based on the statistical properties of time series and do not generally incorporate an understanding of the forces driving secular trends. This paper addresses three research questions: Can the factors found in stochastic mortality-forecasting models be associated with real-world trends in health-related variables? Does inclusion of health-related factors in models improve forecasts? Do resulting models give better forecasts than existing stochastic mortality models? We consider whether the space spanned by the latent factor structure in mortality data can be adequately described by developments in gross domestic product, health expenditure and lifestyle-related risk factors using statistical techniques developed in macroeconomics and finance. These covariates are then shown to improve forecasts when incorporated into a Bayesian hierarchical model. Results are comparable or better than benchmark stochastic mortality models.

Is Mortality Spatial or Social?

Mortality modelling for the purposes of demographic forecasting and actuarial pricing is generally done at an aggregate level using national data. Modelling at this level fails to capture the variation in mortality within country and potentially leads to a mis-specification of mortality forecasts for a subset of the population. This can have detrimental effects for pricing and reserving in the actuarial context. In this paper we consider mortality rates at a regional level and analyse the variation in those rates. We consider whether variation in mortality rates within a country can be explained using local economic and social variables. Using Northern Ireland data on mortality and measures of deprivation we identify the variables explaining mortality variation. We create a population polarisation variable and find that this variable is significant in explaining some of the variation in mortality rates. Further, we consider whether spatial and non-spatial models have a part to play in explaining mortality differentials.

Der deutsche Lebensstandard während des Ersten Weltkrieges in historischer Perspektive: Welche Rolle spielten Konsumentenpräferenzen?

After the outbreak of war in 1914 and the subsequent blockade implemented by British navy, the German economy faced serious food shortages leading to famine-like conditions, especially towards the end of the war. As a response to these shortages, the German authorities introduced and implemented socialist policies such as price ceilings and food rations. This study focuses on the inefficient use of high-quality foodstuffs by members of lower social strata by discussing consumer decisions during the First World War from a microeconomic perspective. The German rationing system provided small, but valuable – measured by black market prices – quantities of superior foodstuffs. Especially meat could have been traded on flourishing black markets for greater quantities of inferior staple foods such as bread and potatoes. In this paper I argue that a more efficient use of rations by the poor could have improved their nutritional situation.

Human height since 1820

Average height is an important indicator of people’s well-being. It is also a relatively undistorted and easy-to-measure indicator, which makes it particularly suitable for comparisons across time and space. Drawing upon an extensive body of research, the chapter describes the strengths and weaknesses of this indicator. It finds that during the 19th century, average height in Western Offshoots was much higher than elsewhere. Differences between Western Europe and the rest of the world (Eastern Europe, East Asia) were marginal, in spite of the much higher real incomes in the former region. This changed after about 1870, when people’s height began to increase in Western Europe, whereas this lagged behind elsewhere. Africans were relatively tall during much of the period studied, but experienced declining height in many countries after the 1960s. People in Southeast Asia stayed relatively short throughout the period.

Technological Learning in Developing Countries

Technological learning refers to the learning processes involved in improving the productive capabilities of an enterprise, sector or economy to enable it to produce higher quality goods or services with increasing levels of efficiency. Approaches to the study of technological learning include case studies of particular countries, sectors and firms; measures of export sophistication; and composite indicators of innovation and competitiveness. The present review draws on these approaches to provide an overview of the policies and practices that have been successful in different regions (East-Asia and Latin America) ; contexts (import substitution and liberalization) ; sectors (pulp and paper, IT services, electronics and passenger cars); and firms (Embrear and Lenovo). While it is clear that there is strong complementarity between domestic technological capability and the ability to absorb foreign technology, there is no simple policy recipe which is appropriate for all times, industries or places. Technological learning builds on and is shaped by what is already known. It requires time, space and resources all of which are influenced by the wider domestic and international context. The current international context is challenging but countries and firms have to find ways of moving forward despite the limited strategy space.

, Lexicographic Preferences in Discrete Choice Experiments: Consequences on Individual-Specific Willingness to Pay Estimates

In discrete choice experiments respondents are generally assumed to consider all of the attributes across each of the alternatives, and to choose their most preferred. However, results in this paper indicate that many respondents employ simplified lexicographic decision-making rules, whereby they have a ranking of the attributes, but their choice of an alternative is based solely on the level of their most important attribute(s). Not accounting for these simple decision-making heuristics introduces systemic errors and leads to biased point estimates, as they are a violation of the continuity axiom and a departure from the use of compensatory decision-making. In this paper the implications of lexicographic preferences are examined. In particular, using a mixed logit specification this paper investigates the sensitivity of individual-specific willingness to pay (WTP) estimates conditional on whether lexicographic decision-making rules are accounted for in the modelling of discrete choice responses. Empirical results are obtained from a discrete choice experiment that was carried out to address the value of a number of rural landscape attributes in Ireland

Regulating Digital Financial Services Agents in Developing Countries to Promote Financial Inclusion

Limited access to bank branches excludes over one billion people from accessing financial services in developing countries. Digital financial services offered by banks and mobile money providers through agents can solve this problem without the need for complex and costly physical banking infrastructures. Delivering digital financial services through agents requires a legal framework to regulate liability. This article analyses whether vicarious liability of the principal is a more efficient regulatory approach than personal liability of the agent. Agent liability in Kenya, Fiji, and Malawi is analysed to demonstrate that vicarious liability of the principal, coupled to an explicit agreement as to agent rewards and penalties, is the more efficient regulatory approach.

Size Matters: The Effect of the Size of Ethnic Groups on Development

The share of ethnic groups is one of the most important features of African politics. It affects civil wars, representation in government positions, distributive and allocative policies. In this paper we use the partition of ethnic groups as a natural experiment in order to estimate the effect of the share of these ethnic groups on development. We show that larger groups have an advantage in terms of development and that the partition in itself does not matter for development. This result is explained by the fact that the partition matters only when the resulting groups are relatively small, since their lack of political representation may weaken support for institutions, may bias policies and the provision of ethnic/regional public goods.

Crucial silences: When Accountability Met PFI and Finance Capital

During recent years, a wide spectrum of research has questioned whether public services/infrastructure procurement through private finance, as exemplified by the UK Private Finance Initiative (PFI), meets minimum standards of democratic accountability. While broadly agreeing with some of these arguments, this paper suggests that this debate is flawed on two grounds. Firstly, PFI is not about effective procurement, or even about a pragmatic choice of procurement mechanisms which can potentially compromise public involvement and input; rather it is about a process where the state creates new profit opportunities at a time when the international financial system is increasingly lacking in safe investment opportunities. Secondly, because of its primary function as investment opportunity, PFI, by its very nature, prioritises the risk-return criteria of private finance over the needs of the public sector client and its stakeholders. Using two case studies of recent PFI projects, the paper illustrates some of the mechanisms through which finance capital exercises control over the PFI procurement process. The paper concludes that recent proposals aimed at “reforming” or “democratising” PFI fail to recognise the objective constraints which this type of state-finance capital nexus imposes on political process.