De Gaulle and Europe: Historical Revision and Social Science Theory. Program for the Study of Germany and Europe Working Paper Series 8.5

The thousands of books and articles on Charles de Gaulle's policy toward European integration, whether written by historians, social scientists, or commentators, universally accord primary explanatory importance to the General's distinctive geopolitical ideology. In explaining his motivations, only secondary significance, if any at all, is attached to commercial considerations. This paper seeks to reverse this historiographical consensus by examining the four major decisions toward European integration during de Gaulle's presidency: the decisions to remain in the Common Market in 1958, to propose the Foucher Plan in the early 1960s, to veto British accession to the EC, and to provoke the "empty chair" crisis in 1965-1966, resulting in the "Luxembourg Compromise." In each case, the overwhelming bulk of the primary evidence-speeches, memoirs, or government documents-suggests that de Gaulle's primary motivation was economic, not geopolitical or ideological. Like his predecessors and successors, de Gaulle sought to promote French industry and agriculture by establishing protected markets for their export products. This empirical finding has three broader implications: (1) For those interesred in the European Union, it suggests that regional integration has been driven primarily by economic, not geopolitical considerations--even in the "least likely" case. (2) For those interested in the role of ideas in foreign policy, it suggests that strong interest groups in a democracy limit the impact of a leader's geopolitical ideology--even where the executive has very broad institutional autonomy. De Gaulle was a democratic statesman first and an ideological visionary second. (3) For those who employ qualitative case-study methods, it suggests that even a broad, representative sample of secondary sources does not create a firm basis for causal inference. For political scientists, as for historians, there is in many cases no reliable alternative to primary-source research.

European antitrust control and standard setting. Bruegel Working Paper 2013/01, February 2012

Standards reduce production costs and increase products’ value to consumers. Standards however entail risks of anti-competitive abuse. After the adoption of a standard, the chosen technology normally lacks credible substitutes. The owner of the patented technology might thus have additional market power relative to locked-in licensees, and might exploit this power to charge higher access rates. In the economic literature this phenomenon is referred to as ‘hold-up’. To reduce the risk of hold-up, standard-setting organisations often require patent holders to disclose their standard-essential patents before the adoption of the standard and to commit to license on fair, reasonable and non-discriminatory (FRAND) terms. The European Commission normally investigates unfair pricing abuse in a standard-setting context if a patent holder who committed to FRAND ex-ante is suspected not to abide to it ex-post. However, this approach risks ignoring a number of potential abuses which are likely harmful for welfare. That can happen if, for example, ex-post a licensee is able to impose excessively low access rates (‘reverse hold-up’) or if a patent holder acquires additional market power thanks to the standard but its essential patents are not encumbered by FRAND commitments, for instance because the patent holder did not directly participate to the standard setting process and was therefore not required by the standard-setting organisations to commit to FRAND ex-ante. A consistent policy by the Commission capable of tackling all sources of harm should be enforced regardless of whether FRAND commitments are given. Antitrust enforcement should hinge on the identification of a distortion in the bargaining process around technology access prices, which is determined by the adoption of the standard and is not attributable to pro-competitive merits of any of the involved players.

Concording EU trade and production data over time. National Bank of Belgium Working Paper No. 239, December 2012

This paper provides concordance procedures for product-level trade and production data in the EU and examines the implications of changing product classifications on measured product adding and dropping at Belgian firms. Using the algorithms developed by Pierce and Schott (2012a, 2012b), the paper develops concordance procedures that allow researchers to trace changes in coding systems over time and to translate product-level production and trade data into a common classification that is consistent both within a single year and over time. Separate procedures are created for the eightdigit Combined Nomenclature system used to classify international trade activities at the product level within the European Union as well as for the eight-digit Prodcom categories used to classify products in European domestic production data. The paper further highlights important differences in coverage between the Prodcom and Combined Nomenclature classifications which need to be taken into account when generating combined domestic production and international trade data at the product level. The use of consistent product codes over time results in less product adding and dropping at continuing firms in the Belgian export and production data.

A Life Cycle Approach to Investor Protection. ECMI Working Paper No. 1/September 2014

The market for investment products, including both securities and investment funds, is fraught with difficulties for consumers in terms of the ease of comparing products, trust in suppliers and consumer satisfaction. A comprehensive approach to investor protection, developed around the lifecycle of a financial product, may offer the investor greater protection during an investment’s life span. This paper proposes a new approach to investor protection, building on a review of major market failures affecting the origination, distribution and sale of financial products and based on a review of the relevant scientific literature and country experiences. The application of a ‘know-your-product’ principle at origination, a narrower ‘default rule’ for best execution and an ex-ante distinction between advice and ‘information-only’ services are among the options discussed in this paper to enhance the investor protection framework over the lifecycle of a financial product.

Iceland’s contested European Policy: The Footprint of the Past - A Small and Insular Society. Jean Monnet Occasional Paper 01/2013

Introduction. Iceland’s domestic politics and foreign affairs are undergoing drastic changes. After an economic crash, violent protests on the streets of Reykjavik for the first time in Iceland’s history contributed to the defeat of the government. The party system has been altered. A turn has been taken towards Europe after the United States left the island, first by closing its military base in 2006 and then by its clear stance not to assist the country in its economic difficulties. The former close relations with the superpower are unlikely ever to be restored. The EU membership application is placing severe constraints on political parties which are split on the issue and has put in jeopardy the unity of the first left majority in the Icelandic parliament, the Althingi. Society is in a state of flux after an unprecedented economic downscaling and the collapse of almost its entire financial sector – which had boomed rapidly beginning in the mid-1990s. The credibility of politicians, the parliament and the media is in ruins. Iceland’s smallness and its location on the geographical map – one could also say the geopolitical map – has had a profound influence on its domestic and foreign affairs. Iceland is closely associated with the other Nordic states and has adopted many of their domestic characteristics, with important exceptions. On the other hand, the country has come under American influence – geographically, it straddles the Mid-Atlantic rift – and has limited its participation in the European project. Its geographical location in the middle of the North Atlantic has led to a notion that the country’s culture is unique and should be protected by all available means. Politicians continue to play the ‘nationalistic uniqueness’ card with considerable success even though the country has been swept by globalization. Rapid modernization (which only really began in the Second World War with British and American occupations) and sudden engagement with the outside world (which only extended to the general public in the last quarter of the twentieth century) are still slowly but steadily making their mark on the country’s foreign policy. The country’s political discourse and foreign policy still bear the hallmark of the past, i.e. of a small and insular society This paper will address the political developments in Iceland since the 2008 economic crash and place it in a historical context. The aim is to understand Iceland’s present foreign policy and, in particular, the highly contested decision by its government in 2009 to apply for membership of the European Union. The paper is divided into five sections in addition to this introduction and the concluding remarks. First, it starts by explaining the importance in Iceland of a political discourse based on the concept of independence which dates back to the historical narrative of the settlement period. This section will also examine Iceland’s close relations with the other Nordic states – despite important differences between it and the others. Second, the paper will analyse the importance of the party system, i.e. the dominance of the centre-right in Icelandic politics, and the changed nature of the system. Third, it examines how Iceland further distinguishes itself from the other Nordic states in many important features. Fourthly, the paper analyses the country’s three main foreign policy priorities in the post-war period, i.e. extensions of the Exclusive Economic Zone, firm defence arrangements with the US and membership of NATO, and the drive for better market access for marine products – including a partial engagement in the European project. Fifthly, the paper examines how the country’s smallness, in terms of its central administrative capacity, has affected its domestic and foreign policy-making. The concluding section summarizes the main findings concerning the political and historical obstacles that the Social Democratic Alliance faces in its hard-fought battle to change the country’s European Policy.

Why Schumpeter's Creative Destruction? Everything has changed, so it is the same: Towards "Mode 3". ACES Working Paper (Report) No. 5, 2007

Of what value is examining creative destruction and diffusion theories that Schumpeter introduced to the world? A variety of factors causes economic changes, but he argued that entrepreneurial innovation was central. Today, even those who create new products and processes hardly know who Schumpeter was, or what he did. It is difficult to believe that his contributions are not more popularly recognized today. Schumpeter's theories are as valuable and important within the contemporary environment as they were when he wrote about them over four score or seventy years ago.

Relaunching the European Retail Finance Market: Comments on the Commission's Green Paper. ECRI Commentary No. 20, 15 December 2015

The European Commission’s Green Paper on retail financial services, published on December 10th, provides valuable insights into the possible benefits of a single market, as well as the obstacles to its development and the possible remedies. While a greater diversity of products within countries could have a positive impact on both consumers and providers, it is also important to highlight that it could contribute to more effective macroeconomic policies at European level. The development of such a single market for Europe where consumers can confidently purchase more profitable financial products abroad necessitates the establishment of a European body along the lines of the US Consumer Financial Protection Bureau (CFPB), or at least the establishment of closer European supervisory cooperation and enforcement. A framework for the digitalisation of financial services should not only focus on mitigating specific types of risk, such as cyber insecurity, lack of privacy and financial exclusion, but it should also continue to maintain a “space of creation” for innovative financial firms.