We investigate whether leading indicators can help explain the cross-country incidence of the 2008–2009 financial crisis. Rather than looking for indicators with specific relevance to the recent crisis, the selection of variables is driven by an extensive review of more than eighty papers from the previous literature on early warning indicators. Our motivation is to address suspicions that indicators found to be useful predictors in one round of crises are typically not useful to predict the next round. The review suggests that central bank reserves and past movements in the real exchange rate were the two leading indicators that had proven the most useful in explaining crisis incidence across different countries and episodes in the past. For the 2008–2009 crisis, we use six different variables to measure crisis incidence: drops in GDP and industrial production, currency depreciation, stock market performance, reserve losses, and participation in an IMF program. We find that the level of reserves in 2007 appears as a consistent and statistically significant leading indicator of who got hit by the 2008–2009 crisis, in line with the conclusions of the pre-2008 literature. In addition to reserves, recent real appreciation is a statistically significant predictor of devaluation and of a measure of exchange market pressure during the current crisis. We define the period of the global financial shock as running from late 2008 to early 2009, which probably explains why we find stronger results than earlier papers such as Obstfeld et al. (2009, 2010) and Rose and Spiegel (2009a,b, 2010, 2011) which use annual data.
Download PDFThis article studies the effect of domestic observers deployed to reduce irregularities in voter registration in a new democracy, and in particular, the response of political parties’ agents to these observers. Because political parties operate over large areas and party agents may relocate away from observed registration centers, observers may displace rather than deter irregularities. We design and implement a large-scale two-level randomized field experiment in Ghana in 2008 taking into account these spillovers and find evidence for substantial irregularities: the registration increase is smaller in constituencies with observers; within these constituencies with observers, the increase is about one-sixth smaller on average in electoral areas with observers than in those without; but some of the deterred registrations appear to be displaced to nearby electoral areas. The finding of positive spillovers has implications for the measurement of electoral irregularities or analysis of data collected by observers.
The 1930s American Dust Bowl was an environmental catastrophe that greatly eroded sections of the Plains. The Dust Bowl is estimated to have immediately, substantially, and persistently reduced agricultural land values and revenues in more-eroded counties relative to less-eroded counties. During the Depression and through at least the 1950s, there was limited relative adjustment of farmland away from activities that became relatively less productive in more-eroded areas. Agricultural adjustments recovered less than 25 percent of the initial difference in agricultural costs for more-eroded counties. The economy adjusted predominantly through large relative population declines in more-eroded counties, both during the 1930s and through the 1950s.
Human societies fashion themselves through rites of memory, gilding and illuminating some pages of the past while consigning others to forgetfulness. Official memories reinforce dominant cultural narratives, asserting continuities where skeptics might see breaks or ruptures, contradictions or untruths; indeed, revolutions, scientific or otherwise, can be thought of as violent breaks with comfortable connections between past and present. To see the power of such story-telling, consider for example the myth of the durability of the US Constitution, a myth that proclaims the unchanging identity of that founding document through a secession, a civil war, and numerous democratizing amendments that totally transformed the look of the nation’s voting polity. To this day, that myth legitimates styles of constitutional analysis that challenge, under the rubric of strict constructionism, attempts to treat the Constitution as a source of living and evolving principles. Or, at the opposite pole of the Earth, take Australia’s ritualistic annual observance of Anzac Day. That remarkable celebration connects the forging of the nation’s identity to Gallipoli: to a dawn landing on faraway shores almost a century ago, in a war of others’ making, to a failed military enterprise that ended in an inglorious evacuation, following a bloody, months-long stalemate.
The United States is in the throes of the most serious recession in post-war history. Despite improving employment numbers, the official unemployment rate still exceeded 8% in March 2012. Amidst this malaise, the health care sector is one of the few areas of steady growth. It may seem natural to think that if the health care sector is one of the bright spots in the economy,public policies should aim to foster continued growth in health care employment. Indeed, hospitals and other health care organizations point to the size of their payrolls as evidence that they play an important role in economic recovery, a role that must not be endangered by reforms that seek to reduce spending on health care. Politicians on both sides of the aisle are quick to emphasize the “job-creating” or “job-killing” aspects of reforms. But this focus on health care jobs is misguided. The goal of improving health and economic well-being does not go hand in hand with rising employment in health care. It is tempting to think that rising health care employment is a boon, but if the same outcomes can be achieved with lower employment and fewer resources, that leaves extra money to devote to other important public and private priorities such as education, infrastructure, food, shelter, and retirement savings.
We revisit Lipset’s law, which posits a positive and significant relationship between income and democracy. Using dynamic and heterogeneous panel data estimation techniques, we find a significant and negative relationship between income and democracy: higher/lower incomes per capita hinder/trigger democratization. We thus challenge the recent empirical literature that found no such significant relationship. We attribute this result to the nature of the tax base, and exploit additional sources of heterogeneity. Decomposing overall income per capita into its resource and non-resource components, we find that the coefficient on the latter is positive and significant while that on the former is significant but negative.
After briefly reviewing the new institutionalism, this article uses the history of political reform in Africa to test its key tenet: that power, if properly organized, is a productive resource. It does so by exploring the relationship between changes in political institutions and changes in economic performance, both at the macro- and the micro-level. The evidence indicates that political reform (Granger) causes increases in GDP per capita in the African subset of global data. And, at the micro-level, it demonstrates that changes in national political institutions in Africa strongly relate to changes in total factor productivity in agriculture.
This essay outlines the evolution of my personal thinking about phenomenology and subjectivity. In previous work, I drew heavily on cultural phenomenology for studying illness, subjective experience, and medical knowledge across cultures. Here I describe why I have become increasingly dissatisfied with this framework for understanding subjectivity and the subject and suggest alternatives I consider important for psychological anthropology. I focus in particular on questions of how to investigate that which is largely unspeakable and unspoken in everyday speech but at times erupts into awareness as complex specters haunting the present. I provide a case from my ongoing research in Java of a young man who suffered an acute psychosis, drawing implications for a theory of subjectivity and methods for psychological anthropology. I point briefly to the relation of madness and memories of political violence as sites for investigating subjectivity, suggesting the importance of a “hauntology” for psychological anthropology. Finally, I address questions about whether a method that addresses hidden aspects of psychological experience requires a stance in which ethnographers “know better than” those with whom they are interacting.
Africa is largely agrarian and the performance of agriculture shapes the performance of its economies. It has long been argued that economic development in Africa is strongly conditioned by politics. Recent changes in Africa’s political systems enables us to test this argument and, by extension, broader claims about the impact of political institutions on economic development. Building on a recent analysis of total factor productivity growth in African agriculture, we find that the introduction of competitive presidential elections in the last decades of the 20th Century appears to have altered political incentives, resulting in policy reforms that have enhanced the performance of farmers.
One of the most dramatic changes in the fiscal federalism landscape during the postwar period has been the rapid growth in state budgets, which almost tripled as a share of GDP and doubled as a share of government spending between 1952 and 2006. We argue that the greater role of states cannot be easily explained by changes in Tiebout forces of fiscal competition, such as mobility and voting patterns, and are not accounted for by demographic or income trends. Rather, we demonstrate that much of the growth in state budgets has been driven by changes in intergovernmental interactions. Restricted federal grants to states have increased, and federal policy and legal constraints have also mandated or heavily incentivized state own-source spending, particularly in the areas of education, health and public welfare. These outside pressures moderate the forces of fiscal competition and must be taken into account when assessing the implications of observed revenue and spending patterns.
There is growing concern over the rising share of the US economy devoted to health care spending. Fueled in part by demographic transitions, unchecked increases in entitlement spending will necessitate some combination of substantial tax increases, elimination of other public spending, or unsustainable public debt. This massive increase in health spending might be warranted if each dollar devoted to the health care sector yielded real health benefits, but this does not seem to be the case. Although we have seen remarkable gains in life expectancy and functioning over the past several decades, there is substantial variation in the health benefits associated with different types of spending. Some treatments, such as aspirin, beta blockers, and flu shots, produce a large health benefit per dollar spent. Other more expensive treatments, such as stents for cardiovascular disease, are high value for some patients but poor value for others. Finally, a large and expanding set of treatments, such as proton-beam therapy or robotic surgery, contributes to rapid increases in spending despite questionable health benefits. Moving resources toward more productive uses requires encouraging providers to deliver and patients to consume high-value care, a daunting task in the current political landscape. But widespread inefficiency also offers hope: Given the current distribution of resources in the US health care system, there is tremendous potential to improve the productivity of health care spending and the fiscal health of the United States.
On 25 March 2012, Macky Sall of the Alliance for the Republic (APR) won the second round of Senegal’s presidential election with 65.8 percent of the vote, handily defeating incumbent president Abdoulaye Wade of the Senegalese Democratic Party (PDS), who had won the most votes in the first round. In contrast to a tumultuous campaign season, election day itself was relatively peaceful. Wade graciously accepted defeat, phoning Sall to congratulate him several hours after the polls closed. French president Nicolas Sarkozy called this gesture “proof of [Wade’s] attachment to democracy.” This appraisal is too generous, however. The peaceful turnover followed months of protests and violent repression, as well as a rumored intervention by military officials to force Wade to accept defeat after the second-round voting. Debates about the constitutionality of Wade’s candidacy, as well as an earlier change that he had proposed in the election law, helped to generate this turmoil, which included at least ten deaths, dozens of arrests, and many injuries.
This special issue offers a first systematic qualitative cross-national exploration of how diverse minority groups respond to stigmatization in a wide variety of contexts. This research is the culmination of a coordinated study of stigmatized groups in Brazil, Israel, and the USA, as well as of connected research projects conducted in Canada, France, South Africa, and Sweden. The issue sheds light on the range of destigmatization strategies ordinary people adopt in the course of their daily life. Articles analyze the cultural frames they mobilize to make sense of their experiences and to determine how to respond; how they negotiate and transform social and symbolic boundaries; and how responses are enabled and constrained by institutions, national ideologies, cultural repertoires, and contexts. The similarities and differences across sites provide points of departure for further systematic research, which is particularly needed in light of the challenges for liberal democracy raised by multiculturalism.
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Empirical testing of competing theories lies at the heart of social science research. We demonstrate that a well-known class of statistical models, called finite mixture models, provides an effective way of rival theory testing. In the proposed framework, each observation is assumed to be generated either from a statistical model implied by one of the competing theories or more generally from a weighted combination of multiple statistical models under consideration. Researchers can then estimate the probability that a specific observation is consistent with each rival theory. By modeling this probability with covariates, one can also explore the conditions under which a particular theory applies.We discuss a principled way to identify a list of observations that are statistically significantly consistent with each theory and propose measures of the overall performance of each competing theory. We illustrate the relative advantages of our method over existing methods through empirical and simulation studies.
