Intra-Group Competition and Inter-Group Conflict: An Application to Northern Ireland

This paper reviews four economic theories of leadership selection in conflictual settings. The first of these by Cukierman and Tomassi (1998) labeled the ‘information rationale’, argues that hawks may actually be necessary to initiate peace agreements. The second labeled the ‘bargaining rationale’ borrowing from Hamlin and Jennings (2007) agrees with the conventional wisdom that doves are more likely to secure peace, but post-conflict there are good reasons for hawks to be rationally selected. The third found in Jennings and Roelfsema (2008) is labeled the social psychological rationale. This captures the idea of a competition over which group can form the strongest identity, so can apply to group choices which do not impinge upon bargaining power. As in the bargaining rationale, dove selection can be predicted during conflict, but hawk selection post-conflict. Finally, the expressive rationale is discussed which predicts that regardless of the underlying structure of the game (informational, bargaining, psychological) the large group nature of decision-making by making individual decision makers non-decisive in determining the outcome of elections may cause them to make choices based primarily on emotions which may be invariant with the mode of group interaction, be it conflictual or peaceful. Finally, the paper analyses the extent to which the theories can throw light on Northern Ireland electoral history over the last 25 years.

An Archival Case Study: Revisiting The Life and Political Economy of Lauchlin Currie

This paper forms part of a wider project to show the significance of archival material on distinguished economists, in this case Lauchlin Currie (1902-93), who studied and taught at Harvard before entering government service at the US Treasury and Federal Reserve Board as the intellectual leader of Roosevelt’s New Deal, 1934-39, as FDR’s White House economic adviser in peace and war, 1939-45, and as a post-war development economist. It discusses the uses made of the written and oral material available when the author was writing his intellectual biography of Currie (Duke University Press 1990) while Currie was still alive, and the significance of the material that has come to light after Currie’s death.

A Soft Edge Target Zone Model: Theory And Application To Hong Kong

Hong Kong’s currency is pegged to the US dollar in a currency board arrangement. In autumn 2003, the Hong Kong dollar appreciated from close to 7.80 per US dollar to 7.70, as investors feared that the currency board would be abandoned. In the wake of this appreciation, the monetary authorities revamped the one-sided currency board mechanism into a symmetric two-sided system with a narrow exchange rate band. This paper reviews the characteristics of the new currency board arrangement and embeds a theoretical soft edge target zone model typifying many intermediate regimes, to explain the notable achievement of speculative peace and credibility since May 2005.

Rationalising ‘Irrational’ Support for Political Violence

This paper provides a rationale for group support for political violence when violence does not provide a material benefi t. A theory of fairness is adopted to demonstrate that although group violence may not be the equilibrium of a material game it may be a fairness equilibrium in a game containing psychological payoffs. For this to happen the material stakes must be perceived as low and psychological payoffs are expressive. Although the material stakes are actually high, members of each group may choose expressively to support the use of violence because the probability of being decisive is low. The paper also considers the possibility of peace emerging as a fairness equilibrium. This can only happen if each group perceives the other as making some sacrifi ce in choosing peace.