Research Library

Kornai, Janos. 2000. Hidden in an Envelope: Gratitude Payments to Medical Doctors in Hungary.Abstract
What is the economic significance of "grey market" payments to physicians in Hungary? Let us look at the question first from the angle of theconsumer of medical provisions, the "buyer" in this unusual market transaction.
Kornai, Janos. 2000. What the Change of System from Socialism to Capitalism Does and Does Not Mean (in Journal of Economic Perspectives: v.14, no. I.Abstract
Two systems can be said to have dominated the 20th century: the capitalist system and the socialist system. This paper discusses the complexities of this seemingly simple statement.
Kim, Wi Saeng. 2000. Does FDI Increase Firm Value in Emerging Markets?.Abstract
The study finds that positive and statistically significant abnormal returns occur around the announcement date of foreign direct investments. The finding suggests that security prices in the Korean stock market do reflect firm-specific information, and that FDI by Korean MNCs are, on average, value increasing investment decisions. The finding is consistent with the studies of Doukas and Travlos (1988) and Fatemi (1984) which found similar results for U.S. MNCs. Interestingly, however, the speed of price adjustment is not instantaneous as has been observed in event studies of the U.S. market. The price adjustment to firm–specific information is slower, and the magnitude of abnormal returns is greater, for the firms that are subject to investor herding behavior.
Kim, Wi Saeng. "Does FDI Increase Firm Value in Emerging Markets?" Working Paper 00–03, Weatherhead Center for International Affairs, Harvard University, 2000.Download PDF
Kapur, Devesh. 2000. Processes of Change in International Organizations.Abstract
Although international institutions are a ubiquitous feature of international life, little is know about their trajectories of change. This paper attempts to address this lacuna by examining processes of change in international institutions, in particular the subset of international institutions known as inter–governmental organizations. The purpose of this paper is not to develop a general theory of change in international institutions but rather to develop limited generalizations about causal mechanisms and their consequences. It first examines the rationale and purposes of international organizations – before we can ask how and why particular types of organizations change, we need to understand why they exist in the first place. It then examines the trajectories of change in international organizations by posing three, interrelated, questions. One, what factors drive (or hinder) change in international institutions and organizations and what are the principal instruments and mechanisms that leverage change? Two, what factors explain variations in the pace and direction of change? And three, what are the consequences of change both for the institutions themselves and for their members? Finally the paper outlines a research agenda to develop a broad theoretical framework for understanding causal mechanisms of change in international organizations.
Kapur, Devesh. "Processes of Change in International Organizations." Working Paper 00–02, Weatherhead Center for International Affairs, Harvard University, 2000.Download PDF
Giersch, Carsten. 2000. Multilateral Conflict Regulation (MCR): The Case of Kosovo.Abstract
This paper analyzes the problems of multilateral conflict regulation in violent ethnic conflicts using the war in Kosovo as a case study. The NATO intervention in the Kosovo conflict culminated in the air campaign "Operation Allied Force" against Yugoslavia (Serbia and Monte–negro) from March 24 through June 10, 1999.
Giersch, Carsten. "Multilateral Conflict Regulation (MCR): The Case of Kosovo." Working Paper 00–04, Weatherhead Center for International Affairs, Harvard University, 2000.Download PDF
Eisold, Diane E. 2000. NATO Enlargement: Poland's Response.Abstract
I will examine relevant aspects of the activities of Poland both leading up to and since its accession into the NATO Alliance. As Poland is generally credited with being the catalyst that precipitated the dissolution of the Soviet Union, its activities are particularly germane. Not only was it the most aggressive in its pursuit of unfettered sovereignty, it represents other important factors that illustrate challenges and opportunities for any alliance.
Dzung, Vu Dang. 2000. A New Balance of Power in Asia-Pacific Implications for ASEAN's Posture.Abstract
The purpose of this paper is to look into and understand a variety of factors, particularly the relationship between the United States and China, and how it affects the rallying of forces and the shaping of a new balance of power in the Asia–Pacific. Based on this, an attempt is made here to arrive at a critical evaluation of ASEAN?s current posture, the problems that may arise, and the policy options taken by ASEAN that can contribute to the strengthening of its role and position.
Cooper, Richard N. 2000. China into the World Economic System.Abstract
China in 1978 embarked on a major economic transformation, seeking to alter the stance of the previous 30 years and engage economically with the rest of the world in several dimensions—trade, foreign direct investment by private firms, external borrowing by government from both private and public sources, education. Each of these represented a major change in policy. The transformation in the intervening 22 years has been dramatic and palpable, as can be seen in the sky–lines of the major cities.Published in Journal of East Asian Studies 1, no. 1 (February 2001).
Clase, Nicola. 2000. US Logic of Ambiguity toward European Security and Defence.Abstract
The purpose of this paper is to develop a greater understanding for US perceptions of Common European Security and Defence policy (CESDP) by looking at major factors, interests, threats, and opportunities that seem to influence thevarying degrees of US support. The first chapter of this paper gives a short historical overview of European security and defence issues and examines the current process of developing CESDP. The second chapter focuses on US strategic interests in Europe and the compatibility of American and European interests. The third chapter presents both opportunities and threats that European security and defence reforms could pose to the transatlantic security partnership. The final chapter looks at possible outcomes of CESDP and discusses ways to ensure a lasting transatlantic partnership on security and defence.
Abdelal, Rawi E. 2000. National Strategy and National Money: Politics and the End of the Ruble Zone, 1991-1994 (Harvard Business School Working Paper 0.
Kelman, Herbert C. 2000. The Role of the Scholar-Practitioner in International Conflict Resolution, International Studies Perspectives. Publisher's VersionAbstract
Can unofficial, academically based, third–party approaches contribute to the prevention and resolution of international and intercommunal conflicts? The article focuses on one such approach, interactive problem solving, which the author has applied primarily in the Israeli–Palestinian conflict. After describing the central took of the approach, the problem–solving workshop, the article goes on to address the role of interactive problem solving and related approaches to the larger process of conflict resolution. In this context, it discusses the relationship of the microprocess of problem–solving workshops to macroprocess on international conflict resolution; the relationship between official and unofficial diplomacy; the relationship between practice and scholarship in conflict resolution; the role of the university in the process; and the possibilities for institutionalizing this model of conflict resolution.
LaPorta, Rafael, Florencio Lopez-de-Silanes, Andrei Shleifer, and Robert W Vishny. 2000. Agency Problems and Dividend Policies Around the World.Abstract
This paper outlines and tests two agency models of dividends. According to the "outcome" model, dividends are the result of effective pressure by minority shareholders to force corporate insiders to disgorge cash. According to the "substitute" model, insiders interested in issuing equity in the future choose to pay dividends to establish a reputation for decent treatment of minority shareholders. The first model predicts that stronger minority shareholder rights should be associated with higher dividend payouts; the second model predicts the opposite. Tests on a cross–section of 4,000 companies from 33 countries with different levels of minority shareholder rights support the outcome agency model of dividends.
Kremer, Michael. 2000. Income-distribution Dynamics with Endogenous Fertility.Abstract
Developing countries with highly unequal income distributions, such as Brazil or South Africa, face an uphill battle in reducing inequality. Educated workers in these countries have a much lower birthrate than uneducated workers. Assuming children of educated workers are more likely to become educated, this tends to increase the proportion of unskilled workers, reducing their wages, and thus their opportunity cost of having children, creating a vicious cycle. A model incorporating this effect generates multiple steady–state levels of inequality, suggesting that in some circumstances, temporarily increasing access to educational opportunities could permanently reduce inequality. Empirical evidence suggests that the fertility differential between the educated and uneducated is greater in less equal countries, consistent with the model.
Iversen, Torben. 2000. The Non-Neutrality of Monetary Policy with Large Price or Wage Setters.Abstract
Monetary rules matter for the equilibrium rate of employment when the number of price–wage setters is small. If the central bank is non–accommodating, sufficiently large unions, bargaining independently, have an incentive to moderate sectoral money wages, and thereby expected real wages. The result is an increase in the real money supply, and hence higher demand and employment. This does not hold, however, with accommodating monetary policy since unions? wage decisions cannot then affect the real money supply. A similar argument holds for large monopolistically–competitive price setters. Rational expectations, complete information, central bank pre–commitment and absence of nominal rigidities are assumed.
Ekiert, Grzegorz. 2000. Civil Society From Abroad: the Role of Foreign Assistance in the Democratization of Poland.Abstract
The paper examines the role of civil society in democratization processes, drawing on East European, mostly Polish, experiences. It begins with a brief overview of the major types of definitions of civil society. Its bulk is devoted to a detailed analysis of the origins and functions of various sectors of civil society during the three phases of democratization: (a) state"socialism's disintegration; (b) transfer of power; and (c)consolidation of democracy. For each phase and each sector of civil society the impact of international linkages and foreign (external) resources is assessed. The essay closes with a set of generalizations on the relationships between various types of civil society on the one hand and the forms of the domestic"international interaction, on the other.
Ekiert, Grzegorz. "Civil Society From Abroad: the Role of Foreign Assistance in the Democratization of Poland." Working Paper 00–01, Weatherhead Center for International Affairs, Harvard University, February 2000.Download PDF
Simmons, Beth A. 2000. International Law and State Behavior: Commitment and Compliance in International Monetary Affairs, American Political Science Review. Publisher's VersionAbstract
Why do sovereign governments make international legal commitments, and what effect does international law have on state behavior? Very little empirical research tries to answer these questions in a systematic way. This article examines patterns of commitment to and compliance with international monetary law. I consider the signal governments try to send by committing themselves through international legal commitments, and I argue that reputational concerns explain patterns of compliance. One of the most important findings is that governments commit to and comply with legal obligations if other countries in their region do so. Competitive market forces, rather than overt policy pressure from the International Monetary Fund, are the most likely "enforcement" mechanism. Legal commitment has an extremely positive effect on governments that have recently removed restrictive policies, which indicates a desire to reestablish a reputation for compliance.
Simmons, Beth A. 2000. International Efforts Against Money Laundering.Abstract
The explosion of international financial activity over the last decade has been a central fact of international economic life. Balance of payments statistics indicate that cross–border transactions in bonds and equities for the G–7 states rose from less than 10 percent of gross domestic product in 1980 to over 140 percent in 1995. International bond markets have reached staggering proportions: by the end of 1995, some US$ 2.803 trillion of international debt securities were outstanding worldwide. Capital flows to developing countries and countries in transition grew from US$ 7 billion in 1990 to over US$ 211 billion in 1995. Foreign lending in the form of international syndicated credit facilities has surged since the 1980s, to over US$ 320 billion at the end of 1995. Foreign exchange transactions – which represent the world's largest market – reached an estimated average daily turnover of nearly US$ 1.2 trillion in 1995 compared to US$ 590 billion daily turnover in 1989... Money laundering cannot be handled effectively on a unilateral or bilateral basis. Significantly different rules across jurisdictions invite "forum shopping," the shifting of business to countries with weaker controls. When the United States passed the Bank Secrecy Act of 1970, tightening reporting requirements for cash transactions over US$ 10,000, illicit money moved to Europe... To yield significant benefits, near–global cooperation is a virtual necessity...
Leaning, Jennifer. 2000. Human Security: A Framework for Assessment in Conflict and Transition.Abstract
Human security is a concept that dates back to the Enlightenment. Various strains of meaning, spanning a focus on individual rights and a preoccupation with territorial integrity of states, have accompanied its use in many settings. In the last 25 years, the term has increasingly been applied to political, social, and economic inputs required to create security for individuals and communities. Most recently there has been growing interest in assessing the usefulness of this concept in the design of policies to provide relief and stabilization in areas emerging from war and conflict. In that transitional context this paper argues for a new definition of human security based on identifying those factors that protect and promote human well being through time. This argument builds on the capabilities analysis of Sen and Dreze, incorporates the vulnerability model described by Webb, and employs the psychosocial needs framework of Amoo. Noting that the provision of basic material supports is essential but not sufficient, the definition of human security advanced here insists on the additional importance, for individuals and communities, of fulfilling three basic psychosocial dimensions: a sense of home and safety; constructive family and social supports; and acceptance of the past and a positive grasp of the future. These three psychosocial dimensions (referred to in shorthand as home, community, and time) are evaluated in a number of settings, primarily in Africa. Suggestions are provided, based upon this concept, for humanitarian efforts in refugee and immediate post–conflict settings. The paper further argues that ways of measuring human security along these three dimensions are more easily approached through the use of negative indices, or threats to human security. The negative indices proposed here are social dislocation (for home), dynamic inequality (for community relationships), and high discount rate (for positive sense of the future). It is noted that further methodological effort is needed to refine the metrics to be used in these indices. Whether this concept and its proposed indices could prove useful in identifying trends in human security (or threats to human security) in the immediate post (or pre) conflict setting will require further empirical work, through retrospective case studies and prospective observation and analysis.
Austen-Smith, David. 2000. Redistributing Income under Proportional Representation, in .Abstract
Although majoritarian decision rules are the norm in legislatures, relatively few democracies use simple majority rule at the electoral stage, adopting instead some form of multiparty proportional representation. Moreover, aggregate data suggest that average income tax rates are higher, and distributions of posttax income flatter, in countries with proportional representation than in those with majority rule. While there are other differences between these countries, this paper explores how variations in the political system per se influence equilibrium redistributive tax rates and income distributions. A three–party proportional representation model is developed in which taxes are determined through legislative bargaining among successful electoral parties, and the economic decision for individuals is occupational choice. Political–economic equilibria for this model and for a two–party,winner–take–all, majoritarian system are derived and compared.
From the Journal of Political Economy 108, (December 2000): 1235-1269.Download PDF
Alesina, Alberto. 2000. Who Trusts Others?.Abstract
Both individual experiences and community characteristics influence how much people trust each other. Using individual–level data drawn from US localities we find that the strongest factors associated with low trust are: i) a recent history of traumatic experiences; ii) belonging to a group that historically felt discriminated against, such as minorities (blacks in particular)and, to a lesser extent, women; iii) being economically unsuccessful in terms of income and education; iv) living in a racially mixed community and/or in one with a high degree of income disparity. Religious beliefs and ethnic origins do not significantly affect trust. The role of racial cleavages leading to low trust is confirmed when we explicitly account for individual preferences on inter–racial relationships: within the same community, individuals who express stronger feelings against racial integration trust relatively less the more racially heterogeneous the community is.