Suchergebnisse

This paper reports recent events in Iceland where the political agents of oligarchs didn't even bother to try to influence, let alone contest, a national referendum on a new constitution because, if they didn't like the result, they would simply find ways to nullify the outcome ex post. The paper reviews and explains the making of Iceland's crowd-sourced constitution bill from 2009 to 2014, and also offers an explanation as to why the bill failed to be passed by Parliament, addressing various criticisms leveled against the bill along the way. It needs to be emphasized that these criticisms, whether well founded or not (and they are not), are irrelevant because Parliament held a national referendum on 20 October 2012 in which the bill and its key individual provisions were accepted by an overwhelming majority of the voters. A democratic nation cannot under any circumstances permit the outcome of national elections, let alone a constitutional referendum, to be fixed ex post, but this is what the Icelandic Parliament is at present trying to do, flirting with a farewell to democracy.

In a major setback for the EU, only two of four Eastern Partnership countries actually initialed Association Agreements at the Vilnius Summit in November 2013. This paper asks what went wrong and what can be done about it. Using a gravity model to estimate the effects of deep and shallow free trade agreements for the Eastern Partnership states with Russia and the EU, the paper shows that the Eastern Partnership countries, including Ukraine, by far the largest in the group, gain significantly from free trade agreements with the EU, but gain little if anything from free trade agreements with Russia.

Natural resource discoveries, even when fairly modest in terms of the revenues they are expected to generate, can have significant macroeconomic effects and implications for the conduct of fiscal and monetary policy. In this respect, Uganda is no different from other oil-rich countries. In five main ways, all of which suggest the need for economic diversification as an efficient risk management strategy, the Dutch disease manifests itself through (i) An appreciation of the local currency in real terms, undermining the profitability of other export industries, and of local industries competing with imports by encouraging imports. (ii) The increased volatility of the real exchange rate induced by oscillating oil prices in world markets, which reduces investment and economic growth over time. (iii) Wage increases in the resource-intensive sector that spill over to the non-resource-based sector, further hampering employment and investment in the non-resource-based sector. (iv) Socially counterproductive rent seeking (and even plundering) in the absence of effective legal and institutional mechanisms that would ensure resource rents accrue to the rightful owners with minimal leakages, and are managed for the benefit of all. (v) Crowding out, by which natural capital (if not well managed) tends to undermine other types of capital essential to economic development, including human and social capital.

Most of the time, crises precede constitutions. Following a brief review of relevant historical background, this article aims to show why Iceland, after its financial collapse in 2008, is now at last on the road to adopting a new constitution to replace the provisional constitution from 1944. The aim is also to show how the constitutional bill of 2011 came into being with significant help from the general public. Further, the article outlines some of the key provisions of the bill as well as why and how it differs from the current constitution. The article concludes by offering a brief discussion of some potential obstacles to the adoption of the bill in parliament, the role of the public, and some lessons from, and for, other countries.

This paper deals with the implications of natural resources for the conduct of economic policies and the role and design of institutions in resource]rich countries. The paper briefly reviews the experience of a few resource]rich countries, highlighting the successes of those that have done well as well as some of the fiscal, monetary, and exchange rate policy issues that arise along the way. Special attention is given to Norway, the worldfs third largest oil exporter, and the role of good governance, including democracy. The paper then turns from anecdotal to econometric analysis by offering a quick glance at some of the empirical cross-country patterns that can be brought to bear on the relationship between natural resources, economic growth, and some of the main determinants of growth, including democracy.

We compare and contrast the economic growth performance of Croatia and Latvia since the collapse of communism in 1991 in an attempt to understand better the extent to which the growth differential between the two countries can be traced to increased efficiency in the use of capital and other resources (intensive growth) as opposed to sheer accumulation of capital (extensive growth). On the basis of a simple growth accounting model, we infer that advances in education at all levels, good governance, and institutional reforms have played a significant role in raising economic output and efficiency in both Croatia and Latvia. The EU perspective made a more significant contribution to growth in Latvia than in Croatia, even if Latvia's immediate post-accession boom proved unsustainable.

This essay reviews the relationship between natural-resource abundance and economic growth around the world, and presents some new results. The principal reasons why resource-based production can inhibit economic growth over long periods are traced to the Dutch disease, neglect of education, rent seeking, and economic policy failures. Across a large number of countries in the period from 1965 to 1998, the share of the primary sector in the labour force is shown to be inversely related to exports, domestic and foreign investment, and education, and directly related to external debt, import protection, corruption, and income inequality. The cross-sectional data show, moreover, that the share of the primary sector in the labour force is inversely related to per capita growth across countries. None of this lies in the nature of things, however. What seems to matter for economic growth is not the abundance of natural resources per se, but rather the quality of their management, and of economic management and institutions in general.