Economic Self-interest Research Articles

Irreconcilable Tensions? The EU’s Development Policy in an Era of Global Illiberalism.

There have always been tensions within the EU’s external development policy between ethical and self-interested approaches and also between universalist and realpolitik policies. The EU’s structural economic power and global neoliberal dominance have allowed these tensions to be subsumed within its external policies. A range of factors has contributed to the rise of illiberalism globally, leading to heightened geoeconomic rivalry while complex changes in global development governance facilitate the use of aid as an instrument of political and economic self-interest. The EU has reacted to this by re-framing its political approach and policies in an effort to rebalance values and interests. A new realism entered EU discourse and there is evidence of this being applied in specific instruments and policies analysed here. Blended finance instruments are ‘dual use’ in that they can be used for more flexible development policies but also to support EU businesses more directly. The proposal to combine nearly all of the previous aid and cooperation instruments into one single legal instrument will also give the EU unprecedented flexibility to use aid funds for various political purposes. These changes are part of a more complex iterative process in the case of the EU than for other international actors. Interests and values are being reconfigured rather than jettisoned in a ‘realist turn’. However, they still represent a significant adjustment for the EU in terms of aid priorities and modalities.

Survey Experiments in International Political Economy: What We (Don't) Know About the Backlash Against Globalization

This article reviews the cumulation of evidence from survey experiments in the field of international political economy (IPE) and discusses their strengths and weaknesses in explaining the backlash against globalization. I first review the advancements made by the most commonly used survey experiment design in IPE, namely the Globalization-as-Treatment design, in which scholars randomly assign information about different features of globalization and solicit respondents’ attitudes toward protectionism. Then I discuss three issues with this design in addressing key puzzles in the emergence of globalization backlash: ( a) using a coarse informational treatment that stacks the deck against the economic self-interest hypothesis; ( b) overattributing globalization as a source of hardship; and ( c) neglecting heterogeneous room-to-maneuver beliefs across and within countries. The article suggests alternative designs and strategies to study these questions. Evidence from survey experiments suggests that much of the globalization backlash we witness today is deeply rooted in domestic politics.

German and European Ordo-liberalism and Constitutionalism in the Post-war Development of International Economic Law

This contribution discusses the regulatory approaches of German-speaking countries to the design of European and international economic law since World War II. The US initiatives for the 1944 Bretton Woods Agreements and the 1947 General Agreement on Tariffs and Trade were driven by neo-liberal, multilateral approaches prioritizing rules-based liberalization of market access barriers, deregulation, privatization and ‘financialization’ of markets as spontaneous information, coordination and sanctioning mechanisms enabling private economic actors to pursue their economic self-interests. By contrast, the post-war German and European ordo-liberalism and the ‘Virginia School’ of ‘law and economics’ perceived markets as legal constructs, which cannot maximize general consumer welfare without legal limitations of ‘market failures’, ‘governance failures’ and ‘constitutional failures’. The federalism and constitutional protection of common market freedoms inside Austria, Germany and Switzerland contributed to their promotion of ordo-liberal, constitutional approaches also in their external economic policies aimed at creating and progressively developing Europe’s micro-economic ‘common market constitution’ not only inside the European Union, but also in the broader ‘European Economic Area’, the European Free Trade Area and the EU’s common commercial policies. The worldwide WTO legal and dispute settlement system was influenced both by neo-liberal US initiatives as well as by ordoliberal European proposals (e.g. for the design of the WTO dispute settlement system). The current US assault on the WTO Appellate Body system is driven by neo-liberal interest group politics and hegemonic mercantilism by the US Trump administration.

Left-Right Ideology and the Debate over International Bailouts: The Case of Grexit

What explains the sharp divide in European public attitudes toward Grexit? We explore this question using original surveys from four of the largest European economies. We contend that differences in economic self-interest, and the often-mentioned chasm between supporters of mainstream and extremist parties, provide little insight into the public divide over Grexit. Instead, we show that the key factor is the split between the left and the right. We then develop and test a set of theoretical explanations for the prominence of this cleavage. We find that the left-right divide over Grexit is not driven by differences in attitudes on redistribution, levels of empathy, or general European Union support. Instead, left and right voters seem to have different expectations about how a default and exit of a currency-union member would affect the European economy. These expectations likely reflect differences in core beliefs about the consequences of a free-market approach.

The defence of cosmopolitan capitalism by Sir Charles Addis, 1914-1919: A microhistorical study of a classical liberal banker in wartime

This study focuses on the efforts of Sir Charles Addis to defend the pre-1914 system of cosmopolitan capitalism. Our central research question is to understand why this merchant banker fought in preserve cosmopolitan capitalism when so many of his peers acquiesced in and even championed its demise. Addis’s moral ideal was an international economic order in which the nationality of firms was irrelevant to the strategies of managers. The First World War dramatically increased the salience of firm nationality in international business. Addis, who was a committed classical liberal, fought against this trend to a degree that is hard to explain with reference to economic self-interest alone. The article, which is based on a range of sources including Addis’s diary, explores Addis’s connections to, and views of, ‘German’ bankers, his relations with the British government, and the political economy of the reparations imposed on Germany by the Versailles Peace settlement.

His Noble Dreams

The subtitle of Richard Drake’s new book on the historian Charles Beard certainly draws the eye. “The Return of the Master Historian of American Imperialism” expresses Drake’s wish to restore his subject’s reputation to where it was before Beard opposed U.S. participation in the Second World War and lambasted Franklin Delano Roosevelt as a great deceiver. So the book does not chronicle Beard’s actual return to prominence—its purpose, rather, is to help catalyze it. Beard’s steep ascent and vertiginous fall bears some similarity to Daedalus and Icarus as aeronautical innovators. “No American historian before Beard could match his sales record,” writes Drake, “his dozens of textbooks and monographs sold in the millions of copies” (1). His breakthrough work was An Economic Interpretation of the Constitution of the United States, published in 1913, which proposed that the Founding Fathers’ constitutional designs were driven principally by economic self-interest. The book was denounced by President Woodrow Wilson and the New York Times—in a front-page editorial—which predictably worked wonders for its sales. Charmingly, former president William Howard Taft wondered why Beard had to depress so many good people by telling the truth.

More than self-interest: Why different classes have different attitudes to income inequality.

The connection between social class and political preferences is among the most well established in the social sciences. This association is typically taken as prima facie evidence of economic self-interest: Classes hold different attitudes, values, and party preferences because they have different economic interests. However, this assumption has rarely been tested empirically. In this article, we use survey data from 18 West European countries to examine why classes differ on a central aspect of political preferences, namely their views on the desirability of income inequality. We find that only a moderate proportion of differences between employee classes in support for redistribution can be accounted for by contemporary differences in resources and risks; differences in economic interests to some degree account for the anti-redistributive preferences of the professional middle classes compared with the working class. However, the preferences of the self-employed have a different explanation; autonomy is a better explanation of the right-wing preferences of the self-employed compared with the working class.

The political economy of “White Identity Politics”: economic self-interest and perceptions of immigration

ABSTRACT This article challenges the prevailing contention that economic self-interest does not affect public attitudes toward immigration. Through an in-depth re-analysis of the data and findings of Ashley Jardina’s White Identity Politics (2019), it is argued, first, that a number of variables that are characterized as status-based or sociotropic can plausibly be interpreted as measuring economic self-interest. Second, and more importantly, it is argued that the variables that are often used to measure economic self-interest do not follow from the theoretical claims that are meant to inform their interpretation. Third, it is shown that limiting one’s analysis to white respondents – a trend which has become typical, especially since the 2016 US presidential election – severely limits one’s capacity to make convincing explanatory claims. I conclude by arguing that a more appropriate measure of economic self-interest is a measure of perceived job (in)security and a more nuanced measure of employment status.

Inequality Federalism and Economic Self-Interest in Subnational Progressive Tax Politics

In a national context of unabated inequality growth and recurrent tax cuts benefiting the wealthy, we have witnessed a notable rise in “inequality federalism,” characterized by subnational initiatives to redress economic inequality through progressive taxation and social spending. While leading research documents the tendency for Americans to fall prey to “unenlightened self-interest” when evaluating complex national tax policy, recent research suggests that the simplicity and clarity of emerging subnational redistributive initiatives facilitates the enactment of economic self-interest, particularly among lower income citizens. This short article builds on prior work by offering the most extensive analysis to date of the role of economic self-interest in public support for subnational progressive tax policies. Drawing upon opinion polls covering eight separate state ballot measures or legislative enactments, we find that in each instance the greatest level of support for the respective progressive tax policy is observed among lower income citizens.

Introduction: The room for manoeuvre for firms in the Third Reich

Since the mid-1990s, questions about the role of private enterprises played during the ‘Third Reich’, including why – and the extent to which – they supported armament, exploitation, and crimes by the Nazis through 1945, have formed a central focus of German economic and business historiography. Numerous case studies of the most important German enterprises (including Krupp, BASF, Flick, and Degussa) have demonstrated that, despite the increasing impact of political and ideological factors, private firms never stopped pursuing their economic self-interest. Even under the extreme ideological circumstances of the ‘Third Reich’, their strategic decisions remained underpinned by economic criteria. In the meantime, a broad consensus has emerged that the state control of firms took place more by virtue of changes in framework conditions affecting the business environment than through direct coercion. Actually, the regime was especially able to control the economy successfully in those cases where it operated with economic incentives and left companies room for manoeuvre, even if the latter became increasingly smaller towards the end of the war due to increasing state intervention and government control. This scope may explain the considerable differences in the behaviour of firms, especially with respect to their involvement in the Nazi crimes, although it was often economic self-interest more than moral shortcomings on the part of managers and entrepreneurs that led the firms to cooperate with the regime. Despite this consensus, however, the question of how much room for manoeuvre firms actually had remains highly contested. A good example of this is the controversy between Peter Hayes and Christoph Buchheim. Buchheim argued that firms enjoyed a high degree of autonomy during the National Socialist period, while Hayes stressed the significance of state intervention in the economy, which firms could not afford to ignore without suffering considerable economic disadvantages. This special issue takes this controversy as a starting point, addressing the still open question of how much freedom of action firms actually had. The basic assumption is that this question can only be reasonably answered on the basis of numerous empirical case studies. For this reason, a general overview on the current state of discussion is presented in the following introduction of the special issue.

Perceived relative social status and cognitive load influence acceptance of unfair offers in the Ultimatum Game.

Participants in the Ultimatum Game will often reject unfair resource allocations at personal cost, reflecting a trade-off between financial gain and maintenance of social standing. Although this rejection behavior is linked to executive control, the exact role of cognitive regulation in relation to status cues is unclear. We propose that the salience of status cues affects how cognitive regulation resolves the conflict between financial gain and social status considerations. Situations that tax executive control by limiting available cognitive resources should increase acceptance rates for unfair offers, particularly when the conflict between economic self-interest and social reputation is high. Here, participants rated their own subjective social status, and then either mentally counted (Load) or ignored (No Load) simultaneously-presented tones while playing two rounds of the Ultimatum Game with an online (sham) “Proposer” of either high or low social status. A logistic regression revealed an interaction of Proposer status with cognitive load. Compared to the No Load group, the Load group showed higher acceptance rates for unfair offers from the high-status Proposer. In contrast, cognitive load did not influence acceptance rates for unfair offers from the low-status Proposer. Additionally, Proposer status interacted with the relative social distance between participant and Proposer. Participants close in social distance to the high-status Proposer were more likely to accept the unfair offer than those farther in social distance, whereas the opposite pattern was observed for offers from the low-status Proposer. Although rejection of unfair offers in the Ultimatum Game has previously been conceptualized as an intuitive response, these results instead suggest it reflects a deliberative strategy, dependent on cognitive resources, to prioritize social standing over short-term financial gain. This study reveals the dynamic interplay of cognitive resources and status concerns within this paradigm, providing new insights into when and why people reject inequitable divisions of resources.

From closed world discourse to digital utopianism: the changing face of responsible computing at Computer Professionals for Social Responsibility (1981–1992)

Computer Professionals for Social Responsibility (CPSR) began in 1981 as a group of computer scientists concerned about nuclear destruction. Early CPSR members analysed military planning documents and levelled technical critiques at how computers were to be used in battle, highlighting the limits of computing technologies. Although early CPSR arguments were primarily technical, as responsible professionals their practices were based on a collective morality and a willingness to question their profession’s economic self-interest. As the Cold War thawed in 1989, CPSR met a series of challenges, including financial issues, leadership turnover, and a changing and expanding role for information technology. CPSR emerged from this crisis with a renewed focus on “civil liberties” that was largely underwritten by the Electronic Frontier Foundation. Although CPSR’s civil liberties advocacy sometimes retained its early arguments and practices by addressing the limitations of information technologies, they also adopted the emerging views of Silicon Valley’s “digital utopianism,” advocating for the growth of information technology. We describe this seemingly contradictory shift in responsibility along three axes: the use of standpoint epistemology for responsible computing, a transition from professional choice to lobbying, and a transition from substantivism to instrumentalism. In this paper, we characterize an important instance of collective responsibility for computing by tracing the evolution of CPSR’s first decade of practices, techniques, and arguments with an eye towards the challenges of responsible computing today.

Not Your Grandpa's Military History

Not Your Grandpa's Military History Serena Zabin (bio) Aaron Sullivan, The Disaffected: Britain's Occupation of Philadelphia During the American Revolution. Philadelphia: University of Pennsylvania Press, 2019. 304 pp. Notes, bibliography, and index. $39.95. Rachel B. Herrmann, No Useless Mouth: Waging War and Fighting Hunger in the American Revolution. Ithaca: Cornell University Press, 2019. 296 pp. Notes and index. $24.95. Military history is making a comeback in the study of the American Revolution. The former reserve of armchair generals and military officers manqués has become a hot (or at least warm) topic again, as scholars have recently turned their attention to armies, occupations, fighting, and encampments. Both of the books under review here grapple with the question of what it meant to experience the American Revolution in physical, even visceral, ways. Intellectual questions of liberty are beside the point; struggles for power were both personal and material. The decisions of generals and the movement of regiments only begin to define the meaning of warfare in these two studies. Following Michael McDonnell's call to take the Revolutionary War more seriously, both scholars treat it as an ugly and cruel conflict distinct from the concurrent political revolution.1 Yet the war that each book describes is so different in its places, peoples, chronologies, and scales that it is hard to believe that it is the same conflict. The juxtaposition of these books reveals more than the various elements of a complicated and wide-ranging eight-year war; it also helps to explain the implications of the ways that we tell the story of the American Revolution. Aaron Sullivan's The Disaffected studies the occupation of Philadelphia by British troops from 1777 to 1778. While those committed to the Continental Cause fled the city as British troops approached, thousands of others, perhaps three quarters of the total population, stayed in Philadelphia, waiting for the British troops with a combination of hope and fear that managed to displease both sides. General Washington and General Howe were equally dismayed at how little support they found among the Pennsylvanians; Washington had hoped that the seat of the Continental Congress would stand firm against the [End Page 507] British invasion. Philadelphians, however, allowed the Redcoats to take the city without firing a shot, yet declined to welcome them with open arms. Those who stayed in Philadelphia cautiously tried to keep from offending anyone. But why should they, or we, assume that conflict always divides people into two camps? The claim that "we assume all Americans must be classified as either "'Patriots'" or "'Loyalists'" (p. 7) has been untenable for at least half a century now.2 As a frame for Sullivan's book, it is a straw man. Many Quaker civilians of course resolutely tried to remain neutral. Wealthy urban women like Elizabeth Drinker (whom Sullivan characterizes as the individual best suited "to represent the story of the occupation," p. 6) watched her husband, who refused to commit to one side or the other, and many people like him marched out of the city. Still others, particularly the farmers outside Philadelphia's limits, found themselves and their produce ravaged by "foraging" troops. As Sung Bok Kim described 30 years ago, Westchester farmers in a similar situation tried to keep their heads down and simply hoped for survival.3 Sullivan describes the Whitalls, a family of Quaker farmers whose farm south of Philadelphia was repeatedly raided by British and Continental soldiers, as doing "what they could to avoid engagement with the politics and violence of the imperial contest" (p. 193). Indifference, even more than fear, seemed to define the Whitalls' politics. Why did some people refuse to take sides? Sullivan defines the disaffected as those whose "defining feature was less loyalty to than a lack of support or affection for either party in the dispute." (p. 7). But refusing to choose a side is itself a choice. Sullivan often suggests that economic self-interest drove decisions. The shifting fortunes of war "prompted disaffected Pennsylvanians to once again reevaluate which political and commercial choices offered the most peaceful and profitable future for themselves and their families" (p. 177). The real reason, however, that no...

How entrepreneurial orientation translates social identities into performance

Purpose Entrepreneurial orientation (EO) has been viewed almost exclusively through the lens of profit-driven firms. However, individuals engage in entrepreneurship not only for economic reasons but also to enrich a community or to advance society. Drawing on upper echelons theory, the purpose of this paper is to address this issue by proposing that founders’ social identities shape the strategic choices of their ventures. Design/methodology/approach Drawing on the data from 318 founders in the early stages of their entrepreneurial activity, the study applies partial least squares structural equation modeling to empirically test whether founders’ social identities influence their ventures’ EO. Findings The findings of the current research show that founders whose dominant purpose is the creation of value for others are more likely to launch ventures oriented toward innovation. On the other hand, ventures of founders driven by economic self-interest accept more risk, which leads to higher performance outcomes on the enterprise, community and societal levels. Originality/value The study enhances the EO discussion by adding social identity theory as a way to explain different levels of EO in firms and answers the call for more diversity in EO–performance measurement by applying specific outcomes on the enterprise, community and societal levels to investigate whether a firm’s EO leads to the desired outcomes.

Wording and Saliency Matter: The Impact of Incentive System and Organizational Value Statement on Employees' Performance

ABSTRACTThis study extends recent research on the interaction of formal and informal controls that may create divergence between economic self-interest and social norms consistent with organizational belongingness. We use a sequence of two experiments to explore the interactive effects of performance incentives and a contemporary value statement promoting organizational belongingness. Experiment 1 focuses on the moderating effect of a general value statement, showing that a value statement increases (decreases) productivity associated with fixed pay (piece-rate) incentives. Experiment 2 further extends the work on value statements by reinforcing the value statement to increase the statement's saliency with employees. The results of the second experiment confirm that enhancing the saliency of the value statement through active delivery increases its moderating effect on productivity. On an overall basis, the results support our theorized disordinal interaction between formal and informal controls. Most notably, a value statement enhances productivity when incentivizing employees using fixed pay.

Economic interdependence and economic sanctions: a case study of European Union sanctions on Russia

Economic sanctions impose costs on sender as well as target states, and those costs increase with the degree of interdependence between the states in question. We test the hypothesis that EU member states that are more economically interdependent with Russia would be the most opposed to the imposition of sanctions on Russia in response to its actions in Ukraine in 2013–2014. However, an analysis of the debate over the imposition of sanctions shows the opposite: a modest positive correlation between economic interdependence and support for the sanctions among EU member states. This finding further calls into question the fundamental linkage between economic self-interest and conflict avoidance among interdependent states.

Nonconformity and socialism: the case of J. G. Greenhough, 1880–1914

Abstract This article examines the life, thought and activism of the prominent Baptist minister John Gershom Greenhough. Existing scholarly and popular narratives generally focus on the key role played by Nonconformity in nurturing the labour movement in late Victorian and Edwardian Britain. Using Greenhough as a case study this article posits an alternative interpretation of this relationship, contending that the individualistic religious culture of Nonconformity was often deeply hostile to socialism. This hostility motivated Greenhough, and others like him, to abandon their historical allegiance to the Liberal party in the early twentieth century in favour of the Conservatives. More broadly, this article investigates the process of political and ideological conversion and challenges dominant historical readings that characterize anti-socialism as being synonymous with middle-class economic self-interest.

Is there a Strategy in China’s Health Official Development Assistance to African Countries?

La Chine fait désormais partie des dix plus grands donateurs bilatéraux pour l’aide publique au développement (APD) en santé en Afrique. Notre objectif est d’étudier les facteurs associés à l’aide à la santé chinoise en Afrique sur la période 2006-2013. L’APD en santé de la Chine est mesurée à partir de la base de données « AidData’s Global Chinese Official Finance Dataset, 2000-2014, Version 1.0 ». Au total, 345 projets d’aide à la santé ont été financés par la Chine en Afrique entre 2006 et 2013 pour un montant total de 764 millions de dollars. L’aide à la santé chinoise apparait réactive aux besoins économiques des pays africains et indépendante de la qualité de leur gouvernance politique. Bien que la Chine semble favoriser les pays ayant une faible capacité à financer des projets en santé, l’aide à la santé chinoise n’est pas corrélée aux mesures directes de besoin en santé des pays africains. Nous ne trouvons pas de preuve forte que l’aide à la santé chinoise soit liée aux dotations en ressources naturelles des pays bénéficiaires. En revanche, nos résultats indiquent l’existence d’une association entre les liens commerciaux avec la Chine et le volume d’aide à la santé reçu par les pays africains. Enfin, nos résultats confirment que la Chine utilise son APD comme un instrument de politique étrangère. Classification JEL: F35, I15

Disentangling the relationship between sociotropic and egotropic trade attitudes: A survey experiment in Japan

AbstractPublic support for protection is typically attributed to economic self-interest. Beyond pocketbook anxieties, a competing approach, however, contends that sociotropic attitudes dictate foreign policy preferences. Researchers, however, have faced difficulty in disentangling sociotropic attitudes from pocketbook concerns in observational studies. This article addresses this problem by utilizing a priming experiment to examine the relationship between socio and egotropic attitudes. In line with the predictions of the sociotropic framework, individuals are less certain about the egotropic effects of trade and sociotropic attitudes are found to influence egotropic perceptions by reducing uncertainty about the pocketbook effects of trade. In contrast, the study fails to find support for the hypothesis that individuals project egotropic concerns onto societal evaluations. The results of the study suggest that future research should pay careful consideration to the relationship between socio and egotropic attitudes when modeling and analyzing trade-policy preferences.

Self-interest versus sociotropic considerations: an information-based perspective to understanding individuals’ trade preferences

Economic self-interest has been central to explaining individual trade preferences. Depending on the theoretical trade model different variables influence individuals’ attitude towards globalization and existing research has come to different conclusions as to whether individuals’ preferences are dependent on skill level, income or the sector of employment. Other studies depart from economic self-interest by arguing that it is not self-interest that motivates individuals to form their preference, but country-level economic factors (sociotropic considerations) instead. We argue that one needs to approach trade preference formation from an information-based perspective and we test experimentally how people react if they are aware that they personally or nationally will gain or lose from trade and which of the two aspects are more important. By using survey experiments embedded in a representative national survey in the U.S. we are able to differentiate whether a person was triggered by ego- or sociotropic benefits/costs of free trade.