Limited Access Order Research Articles

Central Bank Digital Currencies and International Crises: Toward an Authoritarian International Monetary Order?

Central bank digital currencies (CBDCs) may be viewed as an adaptive response to a perceived threat from stablecoins, but international crises matter. Covid-19 induced a top-down digital transformation of the economy, a more state-led economy with contact-free payments, while Russia’s subsequent war in Ukraine and the Western sanctions against Russia have further increased the incentive to use blockchain technology and CBDCs as political enterprises to neutralize the effects of sanctions, and thereby as weapons in economic warfare. This article considers Covid-19 as a turning point, amplified by Russia’s war in Ukraine, and applies fiscal sociology to analyze the use of blockchain, cryptocurrencies, and CBDCs as policy tools to establish economic and political hegemony, where CBDCs may contribute to the emergence of an authoritarian international monetary order. A fragmented order, involving conflict between an autocratic society bloc and an open society bloc, would be feasible, but such a conflict may make open societies more authoritarian. In open societies, cryptocurrencies and stablecoins belong to the market square, while CBDCs belong to the public square, but CBDCs may blur the boundaries of those squares, submitting the market square to the public square. Payment systems may become public–private partnerships controlled by central banks, turning the squares into fortresses and transforming them from open access orders to limited access orders.

Theories of governance and development: How does India’s experience fit?

ABSTRACT This article examines the apparent paradox of India’s combination of durable democracy and electoral accountability with a capable bureaucracy, coinciding with a deficient development trajectory. It outlines the nature of the conceptual problem, where India is an outlier in global patterns. Then it compares different conceptual approaches to drawing connections from governance institutions to development outcomes. Next, it reviews some of the contributions to understanding India’s political economy in recent decades. Finally, it draws lessons from India’s experience for the appropriateness of different theories of governance and development. One conclusion is that the paradox recedes when attention is paid to the subnational level, where India’s states encompass considerable variation in initial societal and economic conditions and in development outcomes, and a sufficiently rich theoretical framework, that of limited access orders, is used to situate and encompass the different subnational experiences.

Failures in Ukrainian Arms Procurement 2014–2023

This article discusses critical failures in Ukrainian defense production and procurement in the period 2014 to 2023. The main puzzle is why Ukraine did so little to satisfy the needs of the country’s armed forces in essential segments of military capabilities when there seems to have been no disagreement on their necessity. Furthermore, both technological and financial resources appear to have been present. The main argument is that Ukraine’s status as a limited access order (LAO) is an important part of the explanation. The empirical evidence in support of this conclusion comes from process-tracing production and procurement in the three areas of ammunition, unmanned aerial vehicles, and armored vehicles. The initial condition of an LAO is linked to the outcome of production and procurement failure through a detailed investigation of the actors and processes that took place within each of the mentioned segments. It is primarily a theory-guided single-outcome study, but the findings may serve as inspiration for more generic studies of the effects of LAOs on national security.

PROPERTY RIGHTS GUARANTEES AS PREREQUISITES FOR ECONOMIC COMPETITION: AN EMPIRICAL STUDY

Economic competition by definition implies a choice between competing alternatives. But can economic agents always protect their rights to make this choice? In order to protect property rights, they should have a guarantor who imposes sanctions on the violator. However, the guarantor must be able to use violence, since the imposition of sanctions is often not voluntary. This paper shows that the uneven distribution of violence in society, which is not monopolized by one decision-making center and/or applied outside the rule of law, hinders economic competition. In such a situation, i.e. in a limited access social order, part of property rights remains unprotected, which prevents the entrepreneur from performing his/her function. The reason for this effect is the desire of the elite to maintain the status quo in distribution of rents: they try to avoid changes caused by the market process that may lead to a violation of existing political balance. In this study, the stated theses are confirmed on microdata of the BEEPS industrial enterprises survey by the European Bank for Reconstruction and Development - we test the hypotheses using stochastic frontier analysis (SFA) and discrete choice models. Empirical analysis allows us to argue that in the limited access order, the obstacle to participation in economic competition is a weak property rights protection - it forces firms to compete for limited resources not by satisfying the needs of consumers, but by following the interests of the property rights guarantor. The results of the study can be useful in developing competition policy measures and explaining the phenomenon of «regulatory bias» in antitrust policy of developing countries.

Peacebuilding, Patronage-Building, and Post-Conflict NGO Corruption: Barriers to Democratization in Anbar, Iraq

Promoting civil society has been a standard component of post-conflict democratic peacebuilding. In post-2003 Iraq, however, the international coalition's introduction of the muhasasa system (apportionment) inhibited local nongovernmental organizations' ability to hold the government to account and made many NGOs into vehicles of state capture. Substantiated by an interview-based study of Anbar Governorate following the 2017 defeat of the Islamic State organization (ISIS), we argue that modeling Iraq as a "limited access order" — in which ruling elites manage society and the economy — largely explains the muhasasa's effects on local NGOs and the widespread perception that the sector is mired in corruption.

Institutions and development in a fragile limited access order of late-medieval Lithuania

Abstract Applying the framework of North et al. (2009, Violence and Social Orders: A Conceptual Framework for Interpreting Recorded Human History. Cambridge: Cambridge University Press), this paper analyses institutional and economic development in a new setting – the Grand Duchy of Lithuania between 1245 and 1386. Although remaining a fragile limited access order, Lithuania achieved positive institutional change. Its elite became more stable by restricting ruling privileges to the grand duke's family and integrating rival dukes through administrative positions and hereditary property rights. This arrangement encouraged land accumulation and productive activity over extraction, while the elite started providing better security to traders and craftsmen seeking to finance its war against the Teutonic Order. Synthesised material evidence reflects development at the extensive margin. However, health data shows no increase in average living standards, potentially due to population growth and inequality. Both sets of findings are consistent with the conceptual framework, as it expects fragile limited access orders to be underdeveloped from a static perspective, but improve following institutional development.

Security assistance, securitization, security systems, and insecurity in the Mediterranean mashriq and maghreb

ABSTRACT The Middle East and North Africa, of which the southern and eastern Mediterranean sub-region constitutes the bulk of the population and territory, is the world’s most securitized region. It is also the leading recipient of security assistance but provides the least security of any global region. A related paradox is that this region, the states of which are the world’s least democratic, receives the bulk of its security assistance from democracies. This article draws upon the causes and consequences of these two paradoxes to investigate relationships between securitization, security systems, and insecurity in the Mediterranean and broader MENA region. These paradoxes are products of historical legacies and limited access orders that characterize the region’s political economies. They are key drivers of ‘Faustian Bargains’ between providers and recipients of security assistance and the costs of those relationships. The article concludes with a review of proposals to improve the balance of costs and benefits of SA, recommending a dual strategy of seeking to reform recipients’ civil–military relations while changing military roles and responsibilities of both partners in security assistance relationships.

Enlisting oil and gas companies for Russia’s Arctic development. Implementation in a rent-based political economy

ABSTRACT Oil and gas extraction remains a cornerstone in Russia’s development plans for the Arctic Zone, even as there are considerable constraints on new projects. But what does it take to implement hydrocarbon-based regional development in a rent-based political economy? This paper employs a case study of interaction between state and business actors over hydrocarbon-based cargo traffic for the Northern Sea Route to show how Russia’s elites respond to constraints on Arctic development. It is argued that aims of development and of national interest protection enable the state to enlist companies when implementing high-level priorities. This happens when state actors mobilise major companies, using their privileges in the limited access order context as incentives. This route to implementation of regional developmental aims reinforces Russia’s current oil and gas-based development model as a future model for the Arctic Zone.

Changing status of Indian democracy :

A democracy is widely accepted to be a system that efficiently manifests public opinion of the electorate while also maintaining a checks and balance on power through free elections. However, India continues to show an increasing incidence of rent-seeking and criminal politics, even while the exercise of democracy remains intact. This paper employs North, Wallis and Weingast's conceptualisation of social organisation as access orders in a society to show that Indian democracy has a system of political representation with an inefficient system of political access. The analysis further contributes to the literature by conceptualising the means of access in societies and argues that India is a society of limited access orders. Using this framework, the paper argues that the limited access in Indian democracy occurs as a result of manipulation of the means of access by a small politico-economic elite, using a system of privileged and personal inter-elite relationships that results in a growing convergence of rent-seeking practices in Indian politics.

The Leadership of Duarte Coelho in the Colonial Pernambuco: Building a Limited Access Order in the Tropics

The Leadership of Duarte Coelho in the Colonial Pernambuco: Building a Limited Access Order in the Tropics

Dollbaum , Jan Matti Lallouet , Morvan Noble , Ben Navalny: Putin's Nemesis, Russia's Future? (review)

SEER, 99, 4, OCTOBER 2021 794 allow for more secure property rights and for a reduction in the economic stakes associated with the transition of power. This difference in thinking also affects any assessment of the fragility of the overall system. Åslund argues that Russia’s crony capitalism is doomed: ‘it is too petrified and brittle to stand the challenges of our time’ (p. 251), but viewing it from a more systemic point of view, as an example of a limited access order (in the framework of North, Wallis and Weingast’s Violence and Social Orders, Cambridge, 2009), leads to a more tempered assessment about its longevity. King’s College London Gulnaz Sharafutdinova Dollbaum, Jan Matti; Lallouet, Morvan and Noble, Ben. Navalny: Putin’s Nemesis, Russia’s Future? Hurst & Company, London, 2021. xii + 252 pp. Notes. Index. £20.00. Alexei Navalny’s oppositional but seemingly vain struggle against the authoritarian Putin regime has dominated recent years’ news coverage of Russia. As the dramatic events connected to Navalny’s poisoning, trial and imprisonment in 2020–21 unfolded together with his release of the YouTube video, ‘A Palace for Putin’, and massive demonstrations all over the country to his support, the international public started to ask for reliable information about Navalny. Who is this man? Is he a pragmatic politician, a fearless and staunch advocate of civil disobedience, or a PR-hungry and relentless fighter against windmills? Or, is he all or none of the above? In order to try to answer these questions the authors of this important monograph, Jan Matti Dollbaum, Morvan Lallouet and Ben Noble, fruitfully analyse the basic roles (or dimensions of his activity, as they prefer to call them) that together make up the public persona of the contradictory and partly enigmatic character of Navalny. In separate chapters they thus take on Navalny as an anti-corruption activist, as a politician and as a protester. Based on the developments from early 2021 on, they also add rudimentary sketches of a fourth role, namely Navalny as a prisoner. They present their arguments in an easily accessible journalistic style, devoid of academic jargon. Even so, the book is very well researched and solidly referenced. Academic readers will be reassured to find that the authors have used triangulated and diversified sources, on a spectrum from online critical and journalistic sources in Russian and English to a rich array of the scholarly literature relevant for the field. Their easy style of presentation is commendable in many ways, as it will undoubtedly help the authors reach a wider audience, not just an academic one, but readers of the latter category may still regret the fact that the authors did not choose to present a traditional list of references. REVIEWS 795 The authors succeed well in analysing the contradictions that are so characteristic of Navalny. One of them is the way in which he advocates the standards of liberal democracy in Russia while being rather authoritarian in his own leadership style. The authors stress that Navalny has been very keen to listen in on popular public sentiments. For example, he has combined a liberal approach to economics with views on social welfare reminiscent of Scandinavian social democracy. In his tuning in on popular sentiments, he oftenemergesasanopportunist,whichperhapsexplainshisearly,controversial flirt with nationalism and anti-migrant sentiments, which, albeit later partly reneged on by him, has come to darken his reputation among liberals at home and abroad. Likewise, he has criticized the way that the annexation of Crimea took place in stark violation of international law, but has stated that now that it has become a fact, it should stay in the Russian Federation. This ambiguous stance should certainly be seen in the context of the domestic popularity of the annexation. In general, this book is a study of Navalny’s public roles, not a biography. It is therefore not an attempt to understand what has formed him into the individual that he is, and what may have brought him to taking on these roles. In the plot of the book, Navalny essentially emerges out of a tabula rasa in the early 2000s, as the authors dispense with his background, youth and upbringing in two...

Dysfunctional orders: Russia’s rubbish protests and Putin’s limited access order

ABSTRACT How do regimes based on limited access orders respond to socially driven discontent? What are the drivers of contentious politics in a state where the authorities assert control over society? This article analyses patterns of protest, repertories, and organization of the “rubbish protests” (musornye protesty) – a phrase coined by the Internet news outlet Zona Media during the Moscow region protests of 2018–2019. The article draws on social movement theories to explain mobilization, framing, and regime repression, and engages with the model of limited access orders to flesh out the specifics of interaction between social protest forces and the Putin regime. Finally, the case is used to tentatively classify the Russian regime as a “dysfunctional” order – where grievance communication and petitioning to the head of state evolves from being an opportunity to being curtailed by bureaucratic red tape and political repression.

A tale of two councils: the changing roles of the security and state councils during the transformation period of modern Russian politics

ABSTRACT There is general agreement that both the Security Council and State Council are significant institutions in Putin’s Russia, but less clarity as to what this means, beyond that each provides opportunities for consultation with specific segments of the elite. Even this modest consensus was confounded in 2020, when both councils seemed to offer potential post-presidential roles for Putin himself, and underwent significant changes. This article describes the legal and administrative evolutions of both bodies, assesses their roles, and considers them from the perspective of a limited access order. It tackles the problem of institutions in undemocratic systems and the thin line between the decorative elements of the political system, and the bodies in which real administrative power is vested. We argue that they have a significant informal role as sites for the negotiation of power and resources and remain potential actors in the ongoing power transformation of the Russian political system.

Composition of the ruling elite, incentives for productive usage of rents, and prospects for Russia’s limited access order

ABSTRACT Vladimir Putin’s personal popularity creates the base for sociopolitical stability of regime. However, in the long term, the aspirations of Russia’s elite for national sovereignty will come to naught without anew economic development model. Applying the “limited access orders” framework of North, Wallis, and Weingast, this essay analyzes the interactions among three key groups in the ruling elite# the top federal bureaucracy, politically connected big business (oligarchs), and heads of security forces (siloviki). It considers the evolution of rent sources in Russia during the last 25 years and the incentives of elite groups. Itargues that under dominance of siloviki after 2012, the ruling coalition could not negotiate anew agreement on rent distribution, nor could it broaden access to economic opportunities and political activity for new social groups. Russia’s ruling elite missed the opportunity to avoid adeep shock that will likely destroy the existing “limited access order”.

Civil society and external actors: how linkages with the EU and Russia interact with socio-political orders in Belarus and Ukraine

ABSTRACT What is the importance of linkages between civil society and external actors? In this article we map the landscape of civil society organisations in Belarus and Ukraine linked to the EU or Russia. Compiling an extensive dataset of organisations, we identify which domains they belong to. We find that linkages with Russia prevail in the culture domain and are based on shared past and exclusive identities. By contrast, linkages with the EU operate in domains related to a democratic future and include diverse groups. These linkages interact dynamically with limited access orders: where they can contribute to opening, they are often restricted.

Opening in times of crisis? Examining NATO and the EU's support to security sector reform in post-Maidan Ukraine

ABSTRACT Security sector reform has remained largely disconnected from the broader debate on societal transition in the literature thus far. We conceptualise how external support to security sector reform could potentially facilitate socio-political order opening in a limited access order. Based on two dimensions, we examine the case of NATO and EU's support to Ukraine's security sector reform between 2014 and 2019. NATO's support to the military and the EU's support to the police and state security service (SBU) appear unlikely to cause opening of the social order, while NATO's support to the military-industrial complex is more likely to cause opening.

Think Tanks in a Limited Access Order: The Case of Ukraine

This article belongs to the special cluster, “Think Tanks in Central and Eastern Europe”, guest-edited by Katarzyna Jezierska and Serena Giusti. Think tanks outside liberal democracies have distinctive features that go beyond the features of the original concept that emerged within the US context. Departing from this empirical observation, we investigate the sources of the organizational power of think tanks in Ukraine as a case of a limited access order (LAO), a social order where privileged individuals maintain discretionary access to societal resources, functions, and institutions. To accomplish this goal, we apply Thomas Medvetz’s analytical concept of a “boundary organization,” which allows us to highlight the hybridity and flexibility of think tanks and thus understand their methods of gaining political access in an LAO. The analysis of interviews with senior representatives of nongovernmental think tanks in Ukraine in 2016–2017 demonstrates that Ukrainian think tanks are resourceful and find indirect ways of influencing politics. These organizations publish their reports in the media and deliver assessments of Ukraine’s international commitments to the country’s donors, thereby indirectly influencing the policy process in the country. Ukrainian think tanks also comply with the expectations of a boundary organization, accumulating and converting economic, academic, and media capital into political capital, using advocacy and networking as conversion tools. One important difference between the expectations of Medvetz’s framework and our findings is that political capital seems to be the goal of think tank activity, while the three other types are used merely instrumentally.

Friendly bureaucrats, formal rules and firms' investment decisions: evidence from a survey experiment in Russia

PurposeThe purpose of this paper is to investigate the links between investment activity and personal contacts for small- and medium-sized firms with public officials at the subnational level in Russia.Design/methodology/approachA list-experiment design, using a survey of 21,000 Russian firms in 2017, was used to evaluate the importance of personal connections with officials for conducting business.FindingsA total of 27% of firms without investment and 37% with investment considered personal connections with officials an important factor for doing business. The importance of such contacts was lower in regions with a better investment climate. However, a higher proportion of firms were likely to invest in the regions where higher importance was placed on political connections. Therefore, in Russia in the mid-2010s, investment from politically connected firms did not crowd out investment from other firms.Research limitations/implicationsAlthough the available data did not allow causality to be defined, the research shows that political connections are important for investors in emerging markets and that the importance of political connections diminishes with improvement in the business climate.Originality/valueThis paper provides a quantitative estimate of the relationship between political connections and firm investment in Russia, an example of large emerging economy. This relationship is moderated by institutional quality at the subnational level. The results provide empirical support for the theory of limited access orders elaborated by North et al. (2009), and stress the importance of rents and their productive utilization for the development of emerging economies.

Multinational enterprises, political institutions, and violence: a case study from Mozambique

AbstractBased on the concept of limited and open access orders (LAO/OAO), this paper explains what appears to be a paradox: how was it possible that a former civil war country, Mozambique, which had been extremely successful in attracting foreign direct investment (FDI) and which the International Monetary Fund praised as a great Sub-Sahara African success story in 2007, only a few years later found itself on the brink of a new civil war? We argue that the destabilization of the country was the result of a toxic mix of domestic politics and a massive inflow of FDI. FDI provided rents to an increasingly dominant state party, FRELIMO, which could be appropriated one-sidedly. It then used these rents to oppress RENAMO, its previous civil war enemy and currently its main opposition party, to monopolize power. This strategy seemed to be successful until RENAMO, faced with the risk of being politically marginalized (and of losing its rents accordingly), returned to armed conflict in 2013. By analyzing the links between the macro-level of national politics and the micro-level of an enterprise and by embedding the interplay between polity and economy into an international context, the paper also makes a theoretical contribution to the LAO/OAO concept.

Trade liberalisation and opening in post-soviet limited access orders

ABSTRACT How does trade liberalisation shape post-Soviet Limited Access Orders (LAOs) where dominant elites restrict access to political and economic resources for the sake of private gains? By drawing on the case of trade liberalisation between the EU and Ukraine, this paper argues that in post-Soviet LAOs the effect of trade liberalisation largely depends on the quality of the pre-existing alliance between political and economic elites in exporting sectors. The findings imply that external trading partners wishing to promote economic and political opening must not ignore the ownership structure of key exporting sectors and the involvement of these key owners in rent-seeking practices. Otherwise, trade liberalisation helps to ensure the durability of LAOs.