Different paths to the modern state in Europe: the interaction between domestic political economy and interstate competition

Theoretical work on state formation and capacity has focused mostly on early modern Europe and on the experience of western European states during this period. While a number of European states monopolized domestic tax collection and achieved gains in state capacity during the early modern era, for others revenues stagnated or even declined, and these variations motivated alternative hypotheses for determinants of fiscal and state capacity. In this study we test the basic hypotheses in the existing literature making use of the large date set we have compiled for all of the leading states across the continent. We find strong empirical support for two prevailing threads in the literature, arguing respectively that interstate wars and changes in economic structure towards an urbanized economy had positive fiscal impact. Regarding the main point of contention in the theoretical literature, whether it was representative or authoritarian political regimes that facilitated the gains in fiscal capacity, we do not find conclusive evidence that one performed better than the other. Instead, the empirical evidence we have gathered lends supports to the hypothesis that when under pressure of war, the fiscal performance of representative regimes was better in the more urbanized-commercial economies and the fiscal performance of authoritarian regimes was better in rural-agrarian economie

Investment, Opportunity, and Risk: Do US Sanctions Deter or Encourage Global Investment?

Complementing the effectiveness of US sanctions debate, the US government often prods US investors to disinvest from targeted countries, hoping to pressure sanctioned countries to back US foreign policy goals or face economic costs for their actions. Missing from the effectiveness of sanctions debate is the impact US sanctions have on third-party foreign direct investment (FDI). Using panel data for 171 countries from 1969 to 2000, we present the first empirical study on the effect of sanctions on global FDI. We find strong evidence that when US firms disinvest during US sanctions, global FDI significantly increases, providing the target country with a reliable source of capital replacement. The results suggest the limited effectiveness of sanctions for restricting capital flows to targeted countries and that US firms may ultimately bear the highest costs from US-imposed sanctions

Political Cleavages and Economic Sanctions: The Economic and Political Winners and Losers of Sanctions

We develop and test a theory, based on the Stolper–Samuelson Theorem, of the effectiveness of sanctions. We treat sanctions as exogenously imposed changes in a country's exposure to international markets. In a country with an open-trade regime, owners and intensive users of the abundant factor of production hold economic and political power. In a country closed to trade, however, economic and political power rests with owners and intensive users of scarce factors. Thus, if real rates of return to the abundant factor decline during sanctions against a trade-open country, or real rates of return to the scarce factor decline during sanctions against a trade-closed country, we expect these economically and politically powerful segments of the targeted country to push hard for policy changes that would bring about an end to sanctions. Statistical analysis of sanctions episodes initiated between 1971 and 2000 provides support for the paper's expectations

Territory, River, and Maritime Claims in the Western Hemisphere: Regime Type, Rivalry, and MIDs from 1901 to 2000

Issues remain at the core of armed conflict. Territory, in particular, appears to increase substantially the probability of inter-state violence and is concluded by many to be one of the most critical correlates of war onset. While scholars have called for an issue-based approach to the study of international relations for some time, recent data collection efforts allow the emergence and management of contentious issues over time to be studied more directly. Our argument and evidence suggest that territory is not necessarily contentious by itself, but is contentious in dyadic contexts characterized by rivalry. Using data from the Issue Correlates of War project, which codes specific government assertions of ownership to territory, river, and maritime locations, we find strategic rivalry, coupled with territorial claims, produces some of the most conflict-prone dyads. Further, jointly democratic domestic institutions do not appear to reduce the hazard of violent conflict over territorial issues within the context of rivalry, although they substantially reduce the hazard of violent conflict among states outside the context of rivalry