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Chapter

19. Policy-Making in a Time of Crisis  

Trends and Challenges

Mark A. Pollack, Helen Wallace, and Alasdair R. Young

This chapter examines trends and challenges in European Union policy-making during times of crisis. It first considers the main trends in EU policy-making that emerge from policy case studies, including experimentation with new modes of policy-making, often in conjunction with more established modes, leading to hybridization; renegotiation of the role of the member states (and their domestic institutions) in the EU policy process; and erosion of traditional boundaries between internal and external policies. The chapter proceeds by discussing the issue of national governance as well as the interaction between European and global governance. Finally, it explores how the EU has responded to the challenges of coping with enlargement from fifteen to twenty-eight member states, digesting the reforms adopted following the implementation of the Treaty of Lisbon, and responding to the economic dislocation associated with the global financial crisis.

Chapter

Leslie Elliott Armijo

This chapter examines Brazil’s emergence as a global power, with a particular focus on how the country has striven to play a bigger role on the international scene. It first provides a brief historical background on Brazil before discussing contemporary Brazilian foreign policy — especially its leaders’ vision of the country as a consequential global player in an increasingly multipolar world. This is seen through the active campaigning for continental integration in which Brazil has played an important role by means of several initiatives. The chapter explores Brazilian foreign policy initiatives in four global issue arenas: trade, climate, financial governance, and nuclear proliferation. It concludes with the suggestion that in terms of material power resources and influence, Brazil was not a global power in the twentieth century, even as it notes the country’s aspiration to become a major international player in the early twenty-first century.

Chapter

Dermot Hodson and Uwe Puetter

This chapter discusses the European Union’s (EU) response to the euro crisis that emerged in late 2009, two years after the global financial crisis struck. It identifies the challenges this crisis has posed to the existing institutional set-up of economic and monetary union (EMU) and shows that it had a lasting impact on discussions over the EU’s future well beyond its most dramatic moments. A timeline of the euro crisis is provided and the main changes to the institutional framework of European economic governance at the time of writing are reviewed. The chapter considers whether the crisis was caused by a deficit of centralized decision-making and whether it has served, in turn, as a catalyst for deeper economic and political integration in the euro area and the Union more generally. The consequences of the crisis for the EU’s legitimacy are also explored from competing theoretical perspectives.

Chapter

Dermot Hodson and Uwe Puetter

This chapter discusses the European Union’s (EU) response to the euro crisis that emerged in late 2009, two years after the global financial crisis struck. It identifies the challenges this crisis has posed to the existing institutional set-up of economic and monetary union (EMU) and shows that it had a lasting impact on dicussions over the EU’s future well beyond its most dramatic moments. A timeline of the euro crisis is provided and the main changes to the institutional framework of European economic governance at the time of writing are reviewed. The chapter considers whether the crisis was caused by a deficit of centralized decision-making and whether it has served, in turn, as a catalyst for deeper economic and political integration in the euro area and the Union more generally. The consequences of the crisis for the EU’s legitimacy are also explored from competing theoretical perspectives.

Chapter

This chapter studies the globalization of finance. The world economy today reflects a systemic experiment involving, on the one hand, the unleashing of cross-border capital movements and, on the other, the dispersion of the political authority necessary to oversee and, when necessary, stabilize the markets through which vast amounts of capital now flow. Resulting tensions become most obvious during financial crises, when those flows suddenly stop or reverse their direction. In the late twentieth century, most such crises began in emerging-market or developing countries and had limited systemic consequences. In 2008, however, the global experiment capital market openness, now far along in its evolution, almost failed catastrophically when policy mistakes in the United States combined with large national payments' imbalances and a broad economic downturn to spawn a worldwide emergency. Shortly thereafter, Europeans at the core of the system narrowly escaped a similar disaster at the regional level. The chapter then explores key implications for contemporary global governance. It calls particular attention to the increasingly difficult and variegated politics of systemic risk assessment, emergency management, and future crisis prevention as the experiment continues.

Chapter

This chapter introduces several debates surrounding the effectiveness of global environmental governance. These debates are closely linked to the choice of policy instruments states make within international regimes. These public policy instruments include regulations, administrative standards, scientific indicators, financial targets, and accounting practices, among others. Whereas international institutions frame the general norms, principles, and rules for tackling environmental problems, instruments provide the toolbox of policy mechanisms that actors in global environmental politics use to implement those norms, principles, and rules. In some cases, the choice of instruments is made at the international level and applied in exactly the same way by a group of states. In other cases, the choice of policy instruments is left to the discretion of states, who can then choose among different alternatives to fulfil their international commitments. The chapter then explains the modalities, diffusion, and political effects of these policy instruments. Although the concept of policy instruments may appear technical and neutral, it shows how instruments can actually shape, modify, and even undermine global environmental politics.

Chapter

This chapter examines the position of the European Union in the global political economy (GPE). It also considers key dimensions of change and development as well as the EU's impact on the operation of the contemporary GPE. To this end, the chapter discusses central ideas in international political economy and relates these to the growth of the EU. Furthermore, it analyses the EU's role in the GPE in three areas: European integration, the EU's engagement in the GPE, and the EU's claims to be a major economic power. It concludes with an assessment of global economic governance, focusing in particular on the EU's role in the financial, economic, and sovereign debt crises.