Focal points and fiscal discipline. ACES Cases No. 2013.2

Many studies suggest that balanced budget rules can restrain sovereign debt and lower sovereign borrowing costs, even if those rules are never enforced in court. Typically, this is explained as a result of a legal deterrence logic, in which the threat of judicial enforcement deters sovereigns from violating the rules. By contrast, we argue that balanced budget rules work by coordinating decentralized punishment of sovereigns by bond markets, rather than by posing a credible threat of judicial enforcement. Therefore, the clarity of the focal point provided by the rule, rather than the strength of its judicial enforcement mechanisms, determines its effectiveness. We develop a formal model that captures the logic of our argument, and we assess this model using data on US states. We then consider implications of our argument for the impact of the balanced budget rules recently imposed on eurozone states in the Fiscal Compact Treaty.

Debating the European debt crisis: Government leadership, party ideology and supranational integration as focal points of parliamentary debates in Austria, Germany and the United Kingdom. ACES Cases No. 2012.3

Parliamentary debates about the resolution of the EU debt crisis seem to provide a good example for the frequently assumed “politicizationˮ of European governance. Against this background, the paper argues that in order to make sense of this assumption, a clearer differentiation of three thematic focal points of controversies – with regard to the assessment of government leadership, concerning the debate between competing party ideologies within the left/right dimension, and with regard to the assessment of supranational integration – is needed. Applying this threefold distinction, the paper uses a theory of differential Europeanization to explain differences in the thematic structure of debates in the Austrian Nationalrat, the British House of Commons, and the German Bundestag. Empirically, the paper is based on data gained from the computer-based coding of plenary debates about the resolution of the European debt crisis between 2010 and 2011.

(Table1) Sedimentation rates and age-control points form ODP Hole 152-919A

Planktic d18O and d13C records and point count records of biogenic, volcanic, and nonvolcanic terrigenous [ice-rafted debris (IRD)] sediment components from Hole 919A in the Irminger basin, northern North Atlantic provide a comprehensive dataset from which a paleoceanographic reconstruction for the last 630 kyr has been developed. The paleoceanographic evolution of the Irminger basin during this time contains both long-term patterns and significant developmental steps. One long-term pattern observed is the persistent deposition of hematite-stained ice-rafted debris. This record suggests that the modern and late Pleistocene discharges of icebergs from northern redbed regions to the Irminger Sea lie in the low end of the range observed over the last 630 kyr. In addition, Arctic front fluctuations appear to have been the main controlling factor on the long-term accumulation patterns of IRD and planktic biogenic groups. The Hole 919A sediment record also contains a long-term association between felsic volcanic ash abundances and light d18O excursions in both interglacial and glacial stages, which suggests a causal link between deglaciations and explosive Icelandic eruptions. A significant developmental step in the paleoceanographic reconstruction based on benthic evidence was for diminished supply of Denmark Strait Overflow Water (DSOW) beginning at ~380 ka, possibly initiated by the influx of meltwater from broad-scale iceberg discharges along the east Greenland coast. There is also planktic evidence of a two-step cooling of sea surface conditions in the Irminger basin, first at ~338-309 ka and later at ~211-190 ka, after which both glacials and interglacials were colder as the Arctic front migrated southeast of Site 919. In addition to offering these findings, this reconstruction provides a longer-term geologic context for the interpretation of more recent paleoceanographic events and patterns of deposition from this region.