Pub Date : 2022-10-02DOI: 10.1080/08911916.2022.2129467
Kari Polanyi Levitt, M. Seccareccia
Abstract The purpose of this article is first to discuss how the so-called fictitious labor market has been analyzed historically, by studying the classical, Marxian, and Lewis dual sectors and then by pointing to the current distinction between formal and informal sectors with the consequences of the phenomenon of informality on measured unemployment. We consider the recent 21st Century experience during the Great Financial Crisis and the current COVID-19 crisis, which, we believe, opens the door to how Karl Polanyi’s vision can offer alternative policy perspectives. This is of crucial significance for those of us who wish to prevent a return to neoliberal policies during the future post-pandemic period, particularly in the emerging and developing countries, where the highest incidence of employment informality prevails.
{"title":"The Polanyi Moment, Decommodification of Labor and the Struggle for Full Employment: How the COVID-19 Crisis has Opened the Debate Over the Nature of the Fictitious Labor Market in Both the Industrialized and Developing World","authors":"Kari Polanyi Levitt, M. Seccareccia","doi":"10.1080/08911916.2022.2129467","DOIUrl":"https://doi.org/10.1080/08911916.2022.2129467","url":null,"abstract":"Abstract The purpose of this article is first to discuss how the so-called fictitious labor market has been analyzed historically, by studying the classical, Marxian, and Lewis dual sectors and then by pointing to the current distinction between formal and informal sectors with the consequences of the phenomenon of informality on measured unemployment. We consider the recent 21st Century experience during the Great Financial Crisis and the current COVID-19 crisis, which, we believe, opens the door to how Karl Polanyi’s vision can offer alternative policy perspectives. This is of crucial significance for those of us who wish to prevent a return to neoliberal policies during the future post-pandemic period, particularly in the emerging and developing countries, where the highest incidence of employment informality prevails.","PeriodicalId":44784,"journal":{"name":"INTERNATIONAL JOURNAL OF POLITICAL ECONOMY","volume":"51 1","pages":"292 - 306"},"PeriodicalIF":1.2,"publicationDate":"2022-10-02","publicationTypes":"Journal Article","fieldsOfStudy":null,"isOpenAccess":false,"openAccessPdf":"","citationCount":null,"resultStr":null,"platform":"Semanticscholar","paperid":"44921243","PeriodicalName":null,"FirstCategoryId":null,"ListUrlMain":null,"RegionNum":0,"RegionCategory":"","ArticlePicture":[],"TitleCN":null,"AbstractTextCN":null,"PMCID":"","EPubDate":null,"PubModel":null,"JCR":null,"JCRName":null,"Score":null,"Total":0}
Pub Date : 2022-10-02DOI: 10.1080/08911916.2022.2137354
Wesley C. Marshall, M. Seccareccia
Abstract In this introductory piece, the authors reminisce on the role played by the late Eugenia Correa in both Mexico and internationally in developing a counter-hegemonic economic thought that matured in her writings and that was sown in the thinking of a whole generation of students over the last three decades.
{"title":"Global Financial Markets, Central Bank Policy, and the Struggle for Full Employment: Celebrating Eugenia Correa’s Achievements in Political Economy – an Introductory Note","authors":"Wesley C. Marshall, M. Seccareccia","doi":"10.1080/08911916.2022.2137354","DOIUrl":"https://doi.org/10.1080/08911916.2022.2137354","url":null,"abstract":"Abstract In this introductory piece, the authors reminisce on the role played by the late Eugenia Correa in both Mexico and internationally in developing a counter-hegemonic economic thought that matured in her writings and that was sown in the thinking of a whole generation of students over the last three decades.","PeriodicalId":44784,"journal":{"name":"INTERNATIONAL JOURNAL OF POLITICAL ECONOMY","volume":"51 1","pages":"289 - 291"},"PeriodicalIF":1.2,"publicationDate":"2022-10-02","publicationTypes":"Journal Article","fieldsOfStudy":null,"isOpenAccess":false,"openAccessPdf":"","citationCount":null,"resultStr":null,"platform":"Semanticscholar","paperid":"46493234","PeriodicalName":null,"FirstCategoryId":null,"ListUrlMain":null,"RegionNum":0,"RegionCategory":"","ArticlePicture":[],"TitleCN":null,"AbstractTextCN":null,"PMCID":"","EPubDate":null,"PubModel":null,"JCR":null,"JCRName":null,"Score":null,"Total":0}
Pub Date : 2022-10-02DOI: 10.1080/08911916.2022.2139703
J. Galbraith
Abstract The multipolar financial world is here. The architects are not Russia or China, but the hapless strategic leadership of the United States, informed by mainstream economics. The United States can survive it—whereas Europe may not—but only with major political and economic changes at home. These include definancialization and demilitarization, but first and foremost, a willingness to realize that the world has changed and that global hegemony based on neoliberal principles has failed.
{"title":"The Dollar System in a Multi-Polar World","authors":"J. Galbraith","doi":"10.1080/08911916.2022.2139703","DOIUrl":"https://doi.org/10.1080/08911916.2022.2139703","url":null,"abstract":"Abstract The multipolar financial world is here. The architects are not Russia or China, but the hapless strategic leadership of the United States, informed by mainstream economics. The United States can survive it—whereas Europe may not—but only with major political and economic changes at home. These include definancialization and demilitarization, but first and foremost, a willingness to realize that the world has changed and that global hegemony based on neoliberal principles has failed.","PeriodicalId":44784,"journal":{"name":"INTERNATIONAL JOURNAL OF POLITICAL ECONOMY","volume":"51 1","pages":"321 - 330"},"PeriodicalIF":1.2,"publicationDate":"2022-10-02","publicationTypes":"Journal Article","fieldsOfStudy":null,"isOpenAccess":false,"openAccessPdf":"","citationCount":null,"resultStr":null,"platform":"Semanticscholar","paperid":"48045189","PeriodicalName":null,"FirstCategoryId":null,"ListUrlMain":null,"RegionNum":0,"RegionCategory":"","ArticlePicture":[],"TitleCN":null,"AbstractTextCN":null,"PMCID":"","EPubDate":null,"PubModel":null,"JCR":null,"JCRName":null,"Score":null,"Total":0}
Pub Date : 2022-10-02DOI: 10.1080/08911916.2022.2137352
Wesley C. Marshall, Louis-Philippe Rochon
Abstract This article asks a simple question that does not have a simple answer: whose interests do independent central banks serve? Employing a Polanyian lens, we explore the many facets of independent central banks, including their history, their institutional nature and functions, and the academic debate surrounding them, in order to reach several conclusions that can hopefully continue to expand the debate regarding the issue.
{"title":"Understanding Central Bank Independence","authors":"Wesley C. Marshall, Louis-Philippe Rochon","doi":"10.1080/08911916.2022.2137352","DOIUrl":"https://doi.org/10.1080/08911916.2022.2137352","url":null,"abstract":"Abstract This article asks a simple question that does not have a simple answer: whose interests do independent central banks serve? Employing a Polanyian lens, we explore the many facets of independent central banks, including their history, their institutional nature and functions, and the academic debate surrounding them, in order to reach several conclusions that can hopefully continue to expand the debate regarding the issue.","PeriodicalId":44784,"journal":{"name":"INTERNATIONAL JOURNAL OF POLITICAL ECONOMY","volume":"51 1","pages":"346 - 373"},"PeriodicalIF":1.2,"publicationDate":"2022-10-02","publicationTypes":"Journal Article","fieldsOfStudy":null,"isOpenAccess":false,"openAccessPdf":"","citationCount":null,"resultStr":null,"platform":"Semanticscholar","paperid":"46089804","PeriodicalName":null,"FirstCategoryId":null,"ListUrlMain":null,"RegionNum":0,"RegionCategory":"","ArticlePicture":[],"TitleCN":null,"AbstractTextCN":null,"PMCID":"","EPubDate":null,"PubModel":null,"JCR":null,"JCRName":null,"Score":null,"Total":0}
Pub Date : 2022-07-03DOI: 10.1080/08911916.2022.2146388
C. Medeiros, Esther Majerowicz
Abstract In the last 40 years, “developmentalism with Chinese characteristics” has creatively combined the main dimensions that in the postwar era spurred the industrialization process in East Asia, where the State, through planning and control mechanisms, governed the markets, leading economic growth, and the process of structural change. The main characteristic that distinguishes the Chinese experience is the structure of its political power formed by a party-state that has great political autonomy and strong penetration in economic power. This power structure helped China to persevere its state-led national development strategy at a time when most national economies adhered to global neoliberalism, giving up such coordination in favor of an accumulation regime led by private corporations.
{"title":"Developmentalism With Chinese Characteristics","authors":"C. Medeiros, Esther Majerowicz","doi":"10.1080/08911916.2022.2146388","DOIUrl":"https://doi.org/10.1080/08911916.2022.2146388","url":null,"abstract":"Abstract In the last 40 years, “developmentalism with Chinese characteristics” has creatively combined the main dimensions that in the postwar era spurred the industrialization process in East Asia, where the State, through planning and control mechanisms, governed the markets, leading economic growth, and the process of structural change. The main characteristic that distinguishes the Chinese experience is the structure of its political power formed by a party-state that has great political autonomy and strong penetration in economic power. This power structure helped China to persevere its state-led national development strategy at a time when most national economies adhered to global neoliberalism, giving up such coordination in favor of an accumulation regime led by private corporations.","PeriodicalId":44784,"journal":{"name":"INTERNATIONAL JOURNAL OF POLITICAL ECONOMY","volume":"51 1","pages":"208 - 228"},"PeriodicalIF":1.2,"publicationDate":"2022-07-03","publicationTypes":"Journal Article","fieldsOfStudy":null,"isOpenAccess":false,"openAccessPdf":"","citationCount":null,"resultStr":null,"platform":"Semanticscholar","paperid":"45273370","PeriodicalName":null,"FirstCategoryId":null,"ListUrlMain":null,"RegionNum":0,"RegionCategory":"","ArticlePicture":[],"TitleCN":null,"AbstractTextCN":null,"PMCID":"","EPubDate":null,"PubModel":null,"JCR":null,"JCRName":null,"Score":null,"Total":0}
Pub Date : 2022-07-03DOI: 10.1080/08911916.2022.2158641
M. Seccareccia
{"title":"Lance Taylor in Memoriam: Editor’s Note","authors":"M. Seccareccia","doi":"10.1080/08911916.2022.2158641","DOIUrl":"https://doi.org/10.1080/08911916.2022.2158641","url":null,"abstract":"","PeriodicalId":44784,"journal":{"name":"INTERNATIONAL JOURNAL OF POLITICAL ECONOMY","volume":"51 1","pages":"171 - 171"},"PeriodicalIF":1.2,"publicationDate":"2022-07-03","publicationTypes":"Journal Article","fieldsOfStudy":null,"isOpenAccess":false,"openAccessPdf":"","citationCount":null,"resultStr":null,"platform":"Semanticscholar","paperid":"48176798","PeriodicalName":null,"FirstCategoryId":null,"ListUrlMain":null,"RegionNum":0,"RegionCategory":"","ArticlePicture":[],"TitleCN":null,"AbstractTextCN":null,"PMCID":"","EPubDate":null,"PubModel":null,"JCR":null,"JCRName":null,"Score":null,"Total":0}
Pub Date : 2022-07-03DOI: 10.1080/08911916.2022.2146387
D. Tropeano
Abstract Though macro-prudential policy is usually aimed at mitigating financial instability, in the European Union it mainly consisted of a discretionary use of old policy tools, such as micro prudential measures, which might have worsened an ongoing financial crisis. Two episodes will be examined: the 2011 special recapitalization of banks and the 2014 Asset Quality Review and stress tests. The metric for the EBA 2011 recapitalization was the ratio of capital to risk-weighted assets. In this exercise, unlike Basel II and III prescriptions, all government bonds had to be accounted for at their current valuation. This feature has not yet been included in any piece of EU legislation and was therefore highly discretionary. Given the falling prices of some European countries’ government bonds, peripheral countries’ banks were in need of more capital. Therefore, they may have reduced credit, especially to SME, or worsened credit conditions. The 2014 stress tests examined the solvency of banks with the same metric and parameters taken from a macroeconomic scenario that was a remake of the 2007–2008 financial crisis. This contrasted with the macroeconomic reality of the time in which a restrictive fiscal policy was affecting firms’ cash flows and hitting, in particular, peripheral countries.
{"title":"The Interplay of Macro-Prudential Regulation and Microeconomic Financial Regulation in the European Union in 2011–2014","authors":"D. Tropeano","doi":"10.1080/08911916.2022.2146387","DOIUrl":"https://doi.org/10.1080/08911916.2022.2146387","url":null,"abstract":"Abstract Though macro-prudential policy is usually aimed at mitigating financial instability, in the European Union it mainly consisted of a discretionary use of old policy tools, such as micro prudential measures, which might have worsened an ongoing financial crisis. Two episodes will be examined: the 2011 special recapitalization of banks and the 2014 Asset Quality Review and stress tests. The metric for the EBA 2011 recapitalization was the ratio of capital to risk-weighted assets. In this exercise, unlike Basel II and III prescriptions, all government bonds had to be accounted for at their current valuation. This feature has not yet been included in any piece of EU legislation and was therefore highly discretionary. Given the falling prices of some European countries’ government bonds, peripheral countries’ banks were in need of more capital. Therefore, they may have reduced credit, especially to SME, or worsened credit conditions. The 2014 stress tests examined the solvency of banks with the same metric and parameters taken from a macroeconomic scenario that was a remake of the 2007–2008 financial crisis. This contrasted with the macroeconomic reality of the time in which a restrictive fiscal policy was affecting firms’ cash flows and hitting, in particular, peripheral countries.","PeriodicalId":44784,"journal":{"name":"INTERNATIONAL JOURNAL OF POLITICAL ECONOMY","volume":"51 1","pages":"229 - 245"},"PeriodicalIF":1.2,"publicationDate":"2022-07-03","publicationTypes":"Journal Article","fieldsOfStudy":null,"isOpenAccess":false,"openAccessPdf":"","citationCount":null,"resultStr":null,"platform":"Semanticscholar","paperid":"42265142","PeriodicalName":null,"FirstCategoryId":null,"ListUrlMain":null,"RegionNum":0,"RegionCategory":"","ArticlePicture":[],"TitleCN":null,"AbstractTextCN":null,"PMCID":"","EPubDate":null,"PubModel":null,"JCR":null,"JCRName":null,"Score":null,"Total":0}
Pub Date : 2022-07-03DOI: 10.1080/08911916.2022.2145042
Devika Dutt, K. Gallagher
Abstract This article examines the extent to which the latest wave of trade and investment treaties has impacted the fiscal stability of the world’s nations. We construct two new measures of trade liberalization based on the importance of a country in the global network of trade and investment treaties, namely the number of trade treaty links and the hub connectedness of a country. This analysis is important since many analyses of the welfare impacts of trade liberalization typically do not consider the impact on the fiscal balances of governments or assume that any loss of tariff revenue would be made up by the imposition of indirect taxes, like a Value Added Tax. Using a cross-country regression analysis, we confirm that trade liberalization has, on average, reduced the amount of tariff revenue collected. Furthermore, trade liberalization is not correlated with an automatic compensation for lost tariff revenue through other taxation measures. We find, in some cases, that trade and investment treaties are correlated with a reduction in total fiscal revenues and an increase in government debt. These results suggest that policymakers need to take the fiscal impacts of trade and investment liberalization into account when making decisions about trade and investment policy.
{"title":"The Fiscal Impacts of Trade and Investment Treaties","authors":"Devika Dutt, K. Gallagher","doi":"10.1080/08911916.2022.2145042","DOIUrl":"https://doi.org/10.1080/08911916.2022.2145042","url":null,"abstract":"Abstract This article examines the extent to which the latest wave of trade and investment treaties has impacted the fiscal stability of the world’s nations. We construct two new measures of trade liberalization based on the importance of a country in the global network of trade and investment treaties, namely the number of trade treaty links and the hub connectedness of a country. This analysis is important since many analyses of the welfare impacts of trade liberalization typically do not consider the impact on the fiscal balances of governments or assume that any loss of tariff revenue would be made up by the imposition of indirect taxes, like a Value Added Tax. Using a cross-country regression analysis, we confirm that trade liberalization has, on average, reduced the amount of tariff revenue collected. Furthermore, trade liberalization is not correlated with an automatic compensation for lost tariff revenue through other taxation measures. We find, in some cases, that trade and investment treaties are correlated with a reduction in total fiscal revenues and an increase in government debt. These results suggest that policymakers need to take the fiscal impacts of trade and investment liberalization into account when making decisions about trade and investment policy.","PeriodicalId":44784,"journal":{"name":"INTERNATIONAL JOURNAL OF POLITICAL ECONOMY","volume":"51 1","pages":"176 - 207"},"PeriodicalIF":1.2,"publicationDate":"2022-07-03","publicationTypes":"Journal Article","fieldsOfStudy":null,"isOpenAccess":false,"openAccessPdf":"","citationCount":null,"resultStr":null,"platform":"Semanticscholar","paperid":"43687669","PeriodicalName":null,"FirstCategoryId":null,"ListUrlMain":null,"RegionNum":0,"RegionCategory":"","ArticlePicture":[],"TitleCN":null,"AbstractTextCN":null,"PMCID":"","EPubDate":null,"PubModel":null,"JCR":null,"JCRName":null,"Score":null,"Total":0}
Pub Date : 2022-07-03DOI: 10.1080/08911916.2022.2145676
Nina Eichacker
Abstract In the aftermath of the Global Financial Crisis (GFC), European governments intervened to support domestic financial systems; several years later, peripheral European economies were at greater risk of having domestic financial crises transform into fiscal crises. While mainstream economic thinking predicts financial markets will punish risky bank behavior with higher interest rates and punitive resolution measures, in fact, banks in core European economies, which engaged in riskier activity in the subprime mortgage market, faced preferential treatment in the aftermath of the GFC. This article argues that financialization, the increased structural economic power of financial institutions, increased the structural power of core members of the Eurozone to direct supranational policies after the GFC. It supports these claims with financial data from balance sheets for a sample of EU economies, as well as institutional analysis of the financial aspects of European integration, and the financial, monetary, and fiscal responses that followed the onset of the GFC. While banks in the Eurozone core were more likely to have engaged in risky behavior, they were more likely to receive liquidity assistance from monetary authorities like the Federal Reserve due to their activity in the US. As Eurozone governments consider how to respond to crises, such as the Covid-19 pandemic going forward, policies that more equitably support governments rescuing domestic financial actors should be considered in tandem with broader financial regulations of structurally important economic institutions.
{"title":"Financialization, Structural Power, and the Global Financial Crisis for Europe’s Core and Periphery","authors":"Nina Eichacker","doi":"10.1080/08911916.2022.2145676","DOIUrl":"https://doi.org/10.1080/08911916.2022.2145676","url":null,"abstract":"Abstract In the aftermath of the Global Financial Crisis (GFC), European governments intervened to support domestic financial systems; several years later, peripheral European economies were at greater risk of having domestic financial crises transform into fiscal crises. While mainstream economic thinking predicts financial markets will punish risky bank behavior with higher interest rates and punitive resolution measures, in fact, banks in core European economies, which engaged in riskier activity in the subprime mortgage market, faced preferential treatment in the aftermath of the GFC. This article argues that financialization, the increased structural economic power of financial institutions, increased the structural power of core members of the Eurozone to direct supranational policies after the GFC. It supports these claims with financial data from balance sheets for a sample of EU economies, as well as institutional analysis of the financial aspects of European integration, and the financial, monetary, and fiscal responses that followed the onset of the GFC. While banks in the Eurozone core were more likely to have engaged in risky behavior, they were more likely to receive liquidity assistance from monetary authorities like the Federal Reserve due to their activity in the US. As Eurozone governments consider how to respond to crises, such as the Covid-19 pandemic going forward, policies that more equitably support governments rescuing domestic financial actors should be considered in tandem with broader financial regulations of structurally important economic institutions.","PeriodicalId":44784,"journal":{"name":"INTERNATIONAL JOURNAL OF POLITICAL ECONOMY","volume":"51 1","pages":"246 - 264"},"PeriodicalIF":1.2,"publicationDate":"2022-07-03","publicationTypes":"Journal Article","fieldsOfStudy":null,"isOpenAccess":false,"openAccessPdf":"","citationCount":null,"resultStr":null,"platform":"Semanticscholar","paperid":"44908054","PeriodicalName":null,"FirstCategoryId":null,"ListUrlMain":null,"RegionNum":0,"RegionCategory":"","ArticlePicture":[],"TitleCN":null,"AbstractTextCN":null,"PMCID":"","EPubDate":null,"PubModel":null,"JCR":null,"JCRName":null,"Score":null,"Total":0}
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