Political Economy Approach Research Articles

The political economy of earnings management in municipally owned enterprises

PurposeDespite the growing body of empirical literature on earnings management in municipal bodies and enterprises on the municipal level, the theoretical foundations often remain limited. This article contributes to filling this research gap by discussing the agency relationships between entities, managers, politicians and the electorate based on the framework of political economy or, more specifically, economic theory of political action. It derives theoretical explanations for earnings management in municipally owned enterprises based on political-economic approaches and provides conceptual guidelines for further theoretical and empirical research in this field.Design/methodology/approachThe article discusses three specific theoretical approaches of political economy (political budget cycles/election cycles, interest fragmentation and partisan ideology) and applies them to the governance structures of municipally owned enterprises. For each of the perspectives, predictions about the use of earnings management and its possible motivations are derived.FindingsThe study shows that political budget cycles/election cycles, interest fragmentation and partisan ideology in municipal decision-making bodies can serve as possible explanations as to which extent managers of municipally owned enterprises present manipulated financial statements. All three approaches can help to explain the prevalence of earnings management but lead to different results regarding the methods and aims of earnings management.Originality/valueAs a significant portion of the current literature on earnings management in municipally owned enterprises lacks a theoretical foundation, our article aims to fill this caveat. To do so, we introduce three new conceptual perspectives that explain the prevalence of earnings management in such enterprises and the political-economic environments that are more likely to produce manipulated financial statements.

Political-Economic Comparison of The World Bank and The New Development Bank

Although stated as one of the influential actors in international relations and discussed in many previous studies, MDB had yet to be comprehensively depicted. Through this research, the author intended to fill this gap by comparing the World Bank as a traditional MDB and the New Development Bank as a Neo MDB within the international economic order. By comparing the political and economic anatomy such as ownership structure, distribution of voting power in decision-making, establishment objectives, types of financing services, operational coverage, sources of funding, private sector options, and service customization and examining them using an organizational political-economy approach, the author found both MDBs had significant differences in carrying out their functions as cross-border financial institutions.

Locked In: Reindustrialisation and the Production of Multiple Marginalities in an Old Mining Town of Hungary

AbstractThis paper aims to unfold how peripheral reindustrialisation in Central and Eastern Europe (CEE) produced multiple marginalities in local spaces. Relying on a cultural political economic (CPE) approach, we analyse how the imaginary of reindustrialisation encompassed the discourses on development and the strategies and practices of powerful agents of economic restructuring in an old mining town of Hungary, which entailed new dimensions and depths of poverty. By discussing the changing labour, housing, and environmental conditions of the local poor, we relate structural changes to the changing conditions of social reproduction and local history, and highlight how the new economic trajectory produced marginalised spaces within a dynamic region. In this way, we also extend CPE‐guided research more to the realms of social reproduction and ethnic social relations to get a more fine‐grained understanding of inequalities rooted in peripheral industrialisation and scrutinise prevailing narratives of economic development in CEE.

The role of municipal ownership for urban net-zero path creation

Particularly within recent years, the rising number of city actors worldwide declaring climate emergencies and pledging commitments to carbon neutrality has sparked a spatial turn in broader sustainable transition thinking, noting the importance of the local level for governing sustainable transitions. Using a Geographical Political Economy approach, this paper critically engages with path creation theory and sustainable transitions literature to explore the potential of urban net-zero carbon transitions in a multi-scalar governance framework. The main argument is that municipal ownership across sectors has a fundamental role in sustainable transitions at the city level. This paper makes a distinct conceptual contribution to sustainable transitions literature by drawing on path creation theory to illustrate how municipal ownership is a central tenet of path creation by bringing together local actors and enabling political capacity and agency to control and strategize integrated sustainable urban pathways. Using the transport and energy sectors in Nottingham in the UK, it applies the Path Creation Framework in an urban setting to illustrate that municipal ownership stimulates a positive path creation through three main arguments. First, municipal ownership enables a positive embeddedness and historical legacy in the provision of sustainable urban energy and transport services; second, it facilitates the establishment of skills and expertise that positively reinforces urban political capacity for the pursuit of urban sustainability; and third, it stimulates the creation of innovative urban projects for sustainable and equitable pathways.

Imperial Past, Neoliberal Present, Dependent Future: A Political-Economic Approach to Urban Development of Bursa

Urban spaces, as the material representatives of past capital accumulation strategies, survive or get replaced on the basis of actors' strategies and partnerships. Periodization allows conceptualising these decisions and subsequent spatial change with respect to evolving local and national settings. The study focuses on expanding such approaches to Türkiye's experience beyond the two primate cities Istanbul and Ankara by the example of a secondary city, Bursa. The study uses maps, plans, official documents and newspapers corresponding to the periods and literature to form the connections between the actors' decisions and the spatial changes. The results highlight that while the previous periods' urban fabric and heritage is being replaced during the neoliberal era in parallel with the national experience, the problems faced as a secondary centre in close proximity to a primate city reduces local agency much more severely, leaving the urban space more vulnerable to exogenous influences.

The Potential Rise of Populism among the Indonesian Muslim Middle Class. Post Covid-19 Pandemic

The economic and political insecurity faced by Indonesia's Muslim middle class may create opportunities for the rise of populism in Indonesia. This study aims to examine the potential for populism supported by Indonesia's Muslim middle class in the aftermath of the Covid-19 pandemic. The critical political economy approach, specifically the class-based approach, has been used in this study. This article uses qualitative research methodology and draws on literary sources. The findings suggest the likely emergence of populist politics in Indonesia, triggered by the economic instability caused by the Covid-19 pandemic, which severely affected the Muslim middle class. This has been exacerbated by long-standing socio-economic insecurity caused by unfavorable labor policies. Furthermore, the emergence of Indonesian populist politics is reinforced by the political polarization of the last decade. The mobilization of the vulnerable Muslim middle class by a charismatic leader could fuel the potential rise of populist politics in Indonesia

Public Service Media in Northern Ireland: Prominence and Vulnerability in a Small Media System

Public Service Media remains at the centre of the public sphere in Northern Ireland. Public Service Media organisations such as the BBC broadcast in a society that remains politically and culturally divided. This has been the case for decades, even if the worst of the violence in Northern Ireland has now dissipated. The Northern Ireland media system includes local media provision, along with provision from the rest of the United Kingdom and the Republic of Ireland. This article identifies Northern Ireland’s media system as sharing characteristics with what Puppis (2009) defines as a small media system, under slightly different conditions. This article takes a Critical Political Economy approach to Public Service Media organisations operating in Northern Ireland, in order to argue that while there is prominence in the place of PSM in the media system, there is also vulnerability inherent.

Placing African Cities in Chinese Lives: A Comparative Study of Migrant Geographies

Based on ethnographic research on Chinese migrants in Nigeria, Botswana, and Namibia from 2011 to 2015, this article has three lines of argumentation and contribution. First, it proposes a framing of migrant geographies from a humanistic comparative perspective in order to complement the political economy approaches in geographies of migration. Second, lying in the intersection of urban studies and migration studies, it illustrates the different positionalities of cities in three aspects of migrant geographies – migrant space, network, and belonging – echoing the multiscalar analysis of city-making in migration processes. Third, specifically in the context of Chinese migrant geographies, three African cities, Lagos, Gaborone, and Windhoek, are placed in three migrants’ geographic worlds, not always according to their positions in multiscalar power structures, but partly through migrant experiences in which top-down power horizontally works.

The Political Economy of Contemporary Insecurity in Nigeria: Theoretical Issues and Explanations

This paper examined the nature of contemporary insecurity in Nigeria. The paper adopts a qualitative methodology, and the data were gathered using documentary sources. It anchors on political economy approach using game theoretic modeling as theoretical framework. The paper argued that Nigerian state is currently facing internal security threats from separatist demands and ethnic militias to terrorism, cattle rustling, kidnapping for ransom, armed banditry, and armed robbery among others. It further stressed that Nigeria's frighteningly high level of insecurity makes its citizens live in constant fear. That Nigeria's socio-economic development has been badly impacted by this insecurity, which also has an influence on the credibility of Nigeria's international image. In order to address Nigeria's worries about insecurity, this paper concluded with policy recommendations, primarily for the National Assembly that corrupt practices must be addressed in order to restore peace in Nigeria. Also, to facilitate effective governance, which is necessary for upholding peace and stability in the country, the National Assembly must use the power of the legislative power derived from the constitution to improve responsiveness, transparency and accountability.

Diversifying News Sources as Multicultural News Production: Critical Political Economy Approach to Sourcing Practices in Ethiopian Mainstream TV Channels

This study examines the diversity of news sourcing in Ethiopian TV channels, utilizing Critical Political Economy approach. It analyses 1167 news stories from 2019 to 2021 and interviews with 25 journalists. The study reveals disparity in the representation of peripheral communities, despite the utilization of various news sources. This indicates that diversifying news sources alone does not guarantee equal representation of diverse voices. Economic limitations, editorial decisions, and language barriers confine news gathering to specific geographic regions. Journalists’ limited autonomy and newsroom culture contribute to prioritizing government affairs thereby limiting diversity of voices. The study suggests collaborative efforts among news editors, managers, and political authorities, and policy framework for multicultural news production, to achieve content and voice diversity. It emphasizes the need to combine normative principles with real-world practices and the impact of resource constraints on media reception and viewer choices in future research.

Corruption, unemployment, and clientelism: A Political Economy approach

We present a theoretical general equilibrium model that incorporates capital allocation dynamics between licit and illicit activities, endogenous unemployment, idiosyncratic moral costs, and the influence of corrupt political power. Our inquiry focuses on the endogeneity of corruption, highlighting its reciprocal relationship with political power, which is mediated through clientelist practices. Using data from Sub-Saharan African countries, our model reveals multiple equilibria, establishing a negative correlation between output and corruption and a positive correlation between corruption and unemployment. In addition, our analysis suggests that implementing appropriate tax rates to fund unemployment benefits can effectively alleviate corruption by transforming unemployed individuals’ perception of subsidies; this shift in perspective diminishes their susceptibility to corrupt practices, underscoring the significance of policy interventions targeting unemployment reduction to weaken clientelist mechanisms and reduce corruption. This study enriches our comprehension of the nuanced impact of corruption on economic outcomes and offers valuable insights for formulating effective anti-corruption policies.

Financialization and labor discipline in contemporary capitalism

PurposeDrawing upon a political economy approach, this article aims to analyze the transformations in the labor market within the context of contemporary capitalism, focusing on the phenomenon of financialization.Design/methodology/approachFinancialization is defined as a distinct wealth pattern marked by a growing proportion of financial assets in capitalist wealth. Within financial markets, corporate performance is continuously assessed, in a process that disciplines management to achieve expected financial results, with consequences throughout corporate management.FindingsWe find that this phenomenon has implications for labor management, resulting in the intensification of labor processes and the adoption of insecure forms of employment, leading to the fractalization of work. These two mechanisms, added to the indebtedness of workers, constitute three elements for disciplining labor in contemporary capitalism.Originality/valueWe argue that these forms of discipline constitute a subsumption of labor to finance, resulting in an increase in labor exploitation. This formulation of the relationship between financialization and changes in the realm of labor also contributes to understanding the unrealizing potential of social free time in contemporary capitalism.

EUROPEAN UNION-UKRAINE AGRICULTURAL TRADE DURING THE RUSSO-UKRAINIAN WAR: A POLITICAL ECONOMY PERSPECTIVE

The article analyzes the consequences of the Russian armed invasion of Ukraine, initiated in February 2022, for the EU’s trade policy towards this country and for the changes in mutual foreign trade in agri-food goods due to its temporary, exceptional liberalization, with particular emphasis on the imports of these products into the EU. The study uses the political economy approach (including interest group theory) to explain the premises of the EU’s specific trade policy towards Ukraine and the crisis in mutual trade relations between Ukraine and its neighboring countries, caused by the excessive inflow of Ukrainian grain into their territories. Large agri-food corporations are identified as potential interest groups monopolizing economic power, influencing the use of agricultural land, the export of agricultural products, and Ukraine’s domestic and foreign policy. The measures of temporary liberalization of trade in agricultural products applied by the EU to Ukraine in response to the war situation resulted in a significant increase in their imports into the EU, while in the case of Poland its share in the volume of EU imports of sensitive products (wheat, maize, rapeseed and sunflower) in the 14 months since the beginning of the war was several to over a dozen times higher than in the 11 months preceding Russia’s invasion of Ukraine.

How Political Dynasties Concentrate Advantage within Cities: Evidence from Crime and City Services in Chicago

Abstract Classic models of urban inequality acknowledge the importance of politics for resource distribution and service provision. Yet, contemporary studies of spatial inequality rarely measure politics directly. In this paper, we introduce political dynasties as a way of integrating political economy approaches with ecological theory to better understand the political construction of urban spatial inequality. To do so, we examine the case of political dynasties within the Chicago city council. We show that, from 2011 to 2018, blocks in dynastic wards saw fewer homicides, assaults, robberies, and thefts relative to those in non-dynastic wards. We then leverage the 2015 ward redistricting to provide evidence that dynastic effects play some role in producing these outcomes: blocks annexed into dynastic wards experienced a decline in assaults and robberies and an increase in pothole coverings. While dynastic politicians improve outcomes for blocks they annex, they also withdraw power from those they displace; and displaced blocks had relatively higher levels of crime than annexed blocks in 2015. Taken together, our findings provide evidence that dynastic politicians are contributing to spatial inequalities within Chicago.

The Omnibus Law on Job Creation and its potential implications for rural youth and future farming in Indonesia

Indonesian rural youth face challenges accessing farmland and sustaining an agricultural livelihood while their labour is not necessarily absorbed by other sectors. In that context, the Omnibus Law on Job Creation (Law 11/2020) promises to liberalise trade and investment across multiple sectors, including agriculture and food security. Combining legal research and political economy approaches to youth and agrarian challenges, we identify amendments to legislation that reduce safeguards for the environment, workers' and farmers' rights and their livelihoods. If fully implemented, the legislative amendments could further narrow youth's options both for secure formal work and futures in farming by accelerating the expansion of infrastructure, industrial plantations and extractive industries that utilise low‐wage labour and huge areas of land. This exposes inconsistencies in the government's approach to increase future food security by promoting intensification of agriculture and attracting youth to farming, while enabling agro‐ and resource extraction that absorbs land yet offers limited and precarious employment prospects.

Platforms, people and politics: The challenges for public service media in Ireland

This article assesses the viability of RTÉ, Ireland’s main public service media (PSM) organization, as an institution and media organization against the backdrop of the largest challenges affecting PSM today. It questions the extent (1) the presence of global platforms, (2) shifting media use and (3) (continued) government support have affected the programming, structure and legitimacy of the Irish public broadcaster. The analytical framework that serves as the basis for our analysis combines a media policy and political economy approach with cultural-sociological analysis. Using expert interviews and document analysis, we show that many of the challenges of RTÉ are generalizable in a European context and a wider international context. We argue that while the government may not be directly undermining RTÉ, its funding position may become so eroded that it would no longer be able to deliver what one of our interviewees describes as a ‘BBC-sized mission in a small jurisdiction’.

Protecting gains: Extractivism, social movements, and the politics of policy implementation

Scholarship on social movements around conflicts over extractive development has advanced in identifying when movements are likely to impact policy adoption. Yet, in Latin America policies are rarely implemented – a reality that commonly leads conflicts to reignite. This introduction sheds light over this often overlooked issue. We focus on the politics of policy implementation – when and how social movements around extractive development have higher chances to favorably impact policy enforcement. To this end, we switch the attention from the strategies of social movements and their outcomes over policy implementation at the local level, to their cumulative impact on national-level policy. We argue for a comparative political economy approach that enables us to identify the systemic, intermediate, and short-term factors that impact the effect of movements on conflicts over policy implementation. Building on this approach, we propose three potential implementation outcomes – positive, status quo and rollback – depending on the degree to which they align with a movement's position. We conclude highlighting the contributions of the articles in this issue to the politics of policy implementation and providing some insights for social movements’ course of action to protect their gains.

Exploring the Relationship between National Security Risks and Economic Factors: A Nepalese Perspective

Macroeconomic variables have a significant impact on national security. This article examines the intricate association between macroeconomic variables and national security, emphasizing the bottomless effects of economic factors on individual vulnerability to national security risks. The evolution of conventional and unconventional power, encompassing both hard and soft power, has taken on a hybrid form central to national security considerations. In today’s globalized world, economic variables have become pivotal in shaping national security threats. Employing the Critical Political Economic Approach (CPE), the study focuses on Nepal as a case study to analyze the interplay between economic determinants and national security risks. The findings indicate that the expansion of trade, financial services, FDI, migration, and remittances both positively and negatively influences national security concerns, whereas growth in poverty and inequality, foreign aid and loans, crises, corruption, critical ICT infrastructures, and cyber risks heighten threats to Nepal's security. The study suggests that fostering strong economic conditions and positive trends can mitigate the likelihood of national security incidents.

Negotiating the public: re-municipalization, water politics and social reproduction

ABSTRACT In the context of the global wave of privatization of local public services, re-municipalization has emerged as a viable policy alternative, broadly understood as the return to public management. The paper examines its transformative potential by analysing what ‘public’ means in practice with a particular focus on governance and decision-making. To do so, the paper investigates the re-municipalization of urban water services in Naples (Italy) and Paris (France) by utilizing qualitative methods. Through a critical political economy approach, informed by social reproduction theory and political ecology, I argue that re-municipalization should be seen as a process that different social forces continuously try to shape. The findings not only contribute to the specific literature on water services, but also to that on re-municipalization, within the debate about public versus private provision. More broadly, the research enhances the understanding of water through the lenses of critical political economy.

Spatial political economy: The ideology of Nature, State–space and the oil commodity frontier

In this article, a spatial political economy approach is used to examine the development of global capitalism through an analysis of the expansionary movement of commodity frontiers. It surveys the early history of oil exploitation in Chile and offers a close analysis of Patagonia’s constitution of its oil commodity frontier as Cheap Energy. It is argued that focusing on the internal relation of space and Nature can enhance our understanding of capitalism as an emergent and dynamic totality grounded in particular places where value is extracted. The article sheds new light on the spatialities of Import Substitution Industrialisation in Latin America using the case of Chile and its development agency, Corfo, and reveals how the capitalist ideology of Nature was wrought as a state project. The political economy of scale in this context is examined by analysing the central role of state and class relations in the environment-making process of capital accumulation. The article advances a new understanding of State–space within uneven and combined capitalist development. The spatial political economy lens allows for a fresh understanding of past history, which may help us understand the current ‘green’ energy transition by means of the production of space and Nature.