money and politics on the international stage james raymond vreeland associate professor school of...
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Money and Politics on the International Stage
James Raymond VreelandAssociate Professor
School of Foreign ServiceGeorgetown University
Presentation for Parents’ WeekendOctober 16, 2010
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What do professors really do?
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Who is this guy?
WEGG
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The responsibilities of a professor
• Teaching
• Service
• Research
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My classes
• International Political Economy– Economics: distribution of scarce resources– Politics: the role of the state in such distribution– International: how the flows of such resources across
borders plays a role• Flows: goods & service (trade), money (capital mobility), people
(immigration), pollutants (the environment), violence (terrorism)
• International Organizations– The ways international institutions impact these flows
• The IMF– Specific financial flows
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Pedagogy
• Substance
• Analytical tools
• Teaching to fish
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Technology in the classroom
• Professor 2.0 – bring your laptops to class
• Syllabus: http://www9.georgetown.edu/faculty/jrv24/INAF_100-14.html
• Google: http://www.google.com/search?q=james+vreeland&rls=com.microsoft:en-us&ie=UTF-8&oe=UTF-8&startIndex=&startPage=1
• Google scholar: – http://scholar.google.com/scholar?q=james%20vreeland&rls=com.microsoft:en-us&oe=UTF-8&startIndex=&startPage=1&um=1&ie=UTF-8&sa=N&hl=en&tab=ws
• Wikipedia?
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Service
• (Meetings, committees)
• Advising students
• Service to the profession
– Conferences
– Reviewing research
– Giving talks…
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Research
• Informs what I teach
• Keeps me on the cutting edge
• Signals to the world Georgetown faculty strength– Signal attracts great students (peers)– Signals employers the university’s caliber
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A current research project…
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UNSC
IMF World Bank
IMF/WB project in Ghana
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The question:
• To gain leverage over one international institution can a country use its power in another international institution?
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Yes.
Why?
• The US and other powerful countries, who virtually control the IMF & World Bank, care about how the UNSC votes.
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• The goal of the major shareholders of the IMF:
– Get countries under a program – in case important votes come up.
• Godfather-esque: “Some day, and that day may never come, I'll call upon you to do a service for me. But uh, until that day, accept this justice as a gift on my daughter’s wedding day.”
• http://www.youtube.com/watch?v=8Bz9iXernY4&feature=fvw
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A quick example
• Tanzania: 1961-1974 no IMF, no UNSC
– 1975
• UNSC member
• First IMF arrangement – exceedingly weak conditionality (credit ceiling)
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IMF reply in the Washington Post (November 1, 2006):
• An IMF spokesman said “the [Tanzania] evidence is anecdotal and circumstantial.”
• To convince people, we need
– many more anecdotes
– statistical evidence (it’s not just luck)
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Figure 1: Participation in IMF programsby rotating membership on the UN Security Council
0.00
0.05
0.10
0.15
0.20
0.25
0.30
0.35
Non-members Members
mean=0.26 mean=0.33
std dev.=0.44 std dev.=0.47
(n=7129) (n=477)
UN Security Council Membership Status
% o
f ob
s. p
artic
ipat
ing
in I
MF
pro
gram
s
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Figure 3: Participation in IMF programsby UN Security Council Membership and Region
0.00
0.10
0.20
0.30
0.40
0.50
0.60
Non-member Member Non-member Member Non-member Member
n=1669 n=95 n=1254 n=100 n=1119 n=47
Africa LA & Carib. Asia & S. Pacific
UN Security Council Membership Status and Region
% o
f o
bs.
pa
rtic
ipa
ting
in I
MF
p
rog
ram
s
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Figure 1: Participation in IMF programs by non-permanent UN Security Council Membership over time
0%
10%
20%
30%
40%
50%
Non-members
Members Other years 4 yearsbefore
3 yearsbefore
2 yearsbefore
1 year before 1st yearmember
2nd yearmember
1 year after 2 years after
mean=0.28 mean=0.34 mean=0.28 mean=0.28 mean=0.31 mean=0.33 mean=0.32 mean=0.35 mean=0.34 mean=0.30 mean=0.28
st.dev.=0.45 st.dev.=0.48 st.dev.=0.45 st.dev.=0.45 st.dev.=0.46 st.dev.=0.47 st.dev.=0.47 st.dev.=0.48 st.dev.=0.48 st.dev.=0.46 st.dev.=0.45
(n=6684) (n=462) (n=5405) (n=178) (n=196) (n=215) (n=236) (n=236) (n=225) (n=234) (n=221)
UN Security Council Membership Status
% o
f ob
s. p
arti
cipa
ting
in I
MF
pro
gram
s
The horizontal line shows the average IMF participation rate across our entire sample. The dots reflect the results where only low and lower-middle income countries are included.
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Table 3: Controlling for Additional Predictors of IMF Participation
Pooled LogitCountry Fixed
EffectsRegional Fixed
EffectsYear Fixed
EffectsTemporal Splines
UNSC 0.59** 0.83** 0.56** 0.51** 0.64**
(Robust std error) (0.24) (0.29) (0.26) (0.22) (0.29)
Foreign Reserves -0.15** -0.005 -0.13** -0.13** -0.04
(Robust std error) (0.03) (0.07) (0.03) (0.03) (0.08)
Debt Service 0.02** 0.02 0.03** 0.03** 0.02**
(Robust std error) (0.01) (0.01) (0.01) (0.01) (0.01)
Investment -0.06** -0.08* -0.05** -0.04** -0.05
(Robust std error) (0.01) (0.05) (0.01) (0.01) (0.04)
Past Participation 2.47** 2.42** 2.45** 2.27** 2.00*
(Robust std error) (0.26) (0.45) (0.27) (0.34) (1.13)
Lagged Election -0.02 -0.06 -0.07 -0.11 -0.11
(Robust std error) (0.16) (0.18) (0.16) (0.17) (0.21)
Budget Surplus 0.01 0.06** 0.01 -0.003 0.06**
(Robust std error) (0.02) (0.03) (0.02) (0.02) (0.03)
Inflation -0.0002** -0.0003 -0.0002* -0.0003** -0.0001
(Robust std error) (0.0001) (0.0002) (0.0001) (0.0001) (0.0002)
Current Account -0.01 -0.001 0.01 0.01 -0.002
(Robust std error) (0.01) (0.02) (0.01) (0.01) (0.02)
BOP -3.89* 0.19 -2.89 -2.09 0.05
(Robust std error) (2.07) (3.17) (2.09) (2.07) (3.22)
GDP/capita (1995 PPP) -0.00003 -0.001** -0.0001* -0.0001** -0.001**
(Robust std error) (0.00003) (0.0002) (0.00004) (0.00004) (0.0002)
Growth -0.001 -0.003 -0.003 -0.002 -0.004
(Robust std error) (0.005) (0.02) (0.004) (0.004) (0.02)
Regime 0.04 0.32 0.18 0.18 0.26
(Robust std error) (0.19) (0.39) (0.20) (0.18) (0.41)
log(checks) 0.08 0.13 0.16 0.07 0.06
(Robust std error) (0.14) (0.25) (0.14) (0.10) (0.24)
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Average # of World Bank projects
0.0
0.5
1.0
1.5
2.0
2.5
avg=1.29
std=1.95
avg=2.13
std=2.93
avg=1.28 avg=1.30
std=1.96 std=1.93
avg=2.15 avg=2.10
std=2.96 std=2.92
avg=2.06 avg=2.19
std=2.75 std=3.11
n=176 n=181
Non-
n=5333 n=357
member Member
Total sample
avg=1.29
std=1.95
n=5333
Non-member
1st.yearmember
2nd yearmember
Over time
n=2638 n=183 n=2695 n=174
Non-member
Member Non-member
Member
During the cold war After the cold war
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Observation by Russian Student
• Bribes – no surprise– Trade money for votes
• But the US bribes…– with a loan – must be repaid!
• Impressive!
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Regional OrganizationsRegional Hegemons
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Allocation of ADB lending by UNSC membership over time
Daniel Yew Mao Lim, Class of 2011
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Going Multipolar?
• Political power & international institutions
• No one at the global level
• Politics go to regional level
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Georgetown global impact
• Places I have taught classes:
• Places I have held a research affiliation:
• Places I have presented my research:
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Conclusion
• Teaching
• Advising
• Research
– Informs our teaching
– Strengthens our global reputation
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Thank youWE ARE GLOBAL GEORGETOWN!