Capital Market Actors in a Varieties of Financial Capitalism // Constraining the executive in resource abundant countries
Capital Market Actors in a Varieties of Financial Capitalism
Abstract / After establishing the banking union, the EU is on its way to implement a capital markets union for the Eurozone. Despite questions about the sustainability of further economic integration, it puts the spotlight on financial institutions and their investment patterns in the Eurozone. While Comparative Political Economy (CPE) is now focusing on the (non-)convergence of national banking systems and the political impact of these different national banking systems during the negotiations for the Banking Union, other financial actors receive only very limited attention (for an exception see Socio-Economic Review, forthcoming 2016). The small amount that has been written in CPE about non-bank financial institutions divides them across a patient-impatient capital dimension (the two extreme cases are Hedge Funds as highly impatient and Family funds as highly patient), yet lack to convincingly conceptualise these actors within national systems. Thus, my project wants to ask the question whether financial institutions differ in their investment patterns towards different types of firms. I will keep the patient-impatient capital dimension which the recent CPE literature borrows from the Varieties of Capitalism approach, but I will increase the scope by dividing firms into large/ international corporations, SMEs and firms that fit the normative ideal of the German Mittelstand.
Discussant / Prof. László Bruszt
Constraining the executive in resource abundant countries
Antonio Smith Bravo
Abstract / The natural resource curse has been widely discussed by scholars of both economics and political science. The impact of institutional quality has been crucial in determining the development paths of resource-dependent countries. Resource abundance in electoral democracies has been associated with lower demands for accountability, which usually results in discretionary expenditures that incentivize political patronage, rent-seeking, and corruption. In order to promote political accountability, liberal democracies have strengthened checks and balances that activate political constraints on the executive. However, the resource curse studies have not addressed how natural resource revenues affect the different types of political constraints on the executive. The purpose of this research is to tease out the impact of natural resource revenues on different types of political constraints on the executive, such as legislative and judicial constraints and the autonomy of subnational units. I hypothesize that resource revenues have a negative impact on the different types of political constraints on the executive. Methodologically, I will look into this issue by analyzing a global panel data set that explains different checks and balances using fixed effects modeling. I will also qualitatively discuss 3 case studies from Latin American oil-dependent electoral democracies -Colombia, Ecuador and Venezuela - in order to reveal the potential mechanisms through which resource booms could affect checks and balances. By closely examining the relationship between natural resource dependency and checks and balances, this research will shed additional light on the topic of democracies dependent on natural resources.
Discussant / Alfredo Hernandez