Regulating State Aid: Inter-jurisdictional competition, public choice, and corporate governance

Depending on the regulatory regime they are subject to, governments may or may not be allowed to hand out state aid to private firms. The economic justification for state aid can address several issues present in the competition for capital and the competition for transfers from the state. First, there are principal-agent problems involved at several stages. Self-interested politicians might enter state aid deals that are the result of extensive rent-seeking activities of organized interest groups. Thus the institutional design of political systems will have an effect on the propensity of a jurisdiction to award state aid. Secondly, fierce competition for firm locations can lead to over-spending. This effect is stronger if the politicians do not take into account the entirety of the costs created by their participation in the firm location race. Thirdly, state aid deals can be incomplete and not in the interest of the citizens. This applies if there are no sanctions if firms do not meet their obligations from receiving aid, such as creating a certain number of jobs or not relocating again for a certain amount of time. The separation of ownership and control in modern corporations leads to principal-agent problems on the side of the aid recipient as well. Managers might receive personal benefits from subsidies, the use of which is sometimes less monitored than private finance. This can eventually be to the detriment of the shareholders. Overall, it can be concluded that state aid control should also serve the purpose of regulating the contracting between governments and firms. An extended mandate for supervision by the European Commission could include requirements to disincentive the misuse of state aid. The Commission should also focus on the corporate governance regime in place in the jurisdiction that awards the aid as well as in the recipient firm.

Myanmar higher education in transition: the interplay between state authority, student politics and international actors.

The Myanmar “period of transition” (2011-2021) has often been described as a puzzle. Various scholars have begun to engage with the Myanmar context in an effort to grasp the essence of the transition it underwent during President Thein Sein’s USPD and Aung San Suu Kyi’s NLD governments. My work focuses on a specific policy sector, higher education, with a view to contributing to this scholarly debate regarding what was actually happening inside this complex country “transition”, especially in terms of collective participation in the process of political and social change. Reviewing existing scholarly literature on the politics of higher education, my study employs a triangle of analysis in which higher education reform is framed as the interplay of action on the part of “state authority”, “student politics” and “international actors”. What does this interplay lens reveal if we consider Myanmar’s “period of transition”? I argue that it shows the ambiguity and contradiction of tangible pushes for progressive social change that coexisted with authoritarian currents and the reinforcement of the societal position of dominant elites. At the policy level, ultimately, a convergence of interests between international actors and state authority served as the force driving the new higher education reform towards a neo-liberal model of governance and autonomy. This work unpacks the higher education reform process thanks to qualitative data gathered through extensive participant observation, in-depth interviewing and critical discourse analysis, shedding light on the rich narratives of those involved in the politics of higher education in Myanmar.