Stephan Haggard

Theories of International Regimes

Over the last decade, international regimes have become a major focus of empirical research and theoretical debate within international relations. This article provides a critical review of this literature. We survey contending definitions of regimes and suggest dimensions along which regimes vary over time or across cases; these dimensions might be used to operationalize “regime change.” We then examine four approaches to regime analysis: structural, game-theoretic, functional, and cognitive. We conclude that the major shortcoming of the regimes literature is its failure to incorporate domestic politics adequately. We suggest a research program that begins with the central insights of the interdependence literature which have been ignored in the effort to construct “systemic” theory.

Fiscal Decentralization: A Political Theory with Latin American Cases

Theories of fiscal federalism explain the efficiency and other economic gains from decentralization but do not explain its extent and nature in practice. The authors develop a political theory of decentralization that focuses on the lines of political accountability between politicians at different levels of government. The more accountable central-level politicians--presidents and legislators--are to subnational politicians, the greater the extent of decentralization and the more it will conform to the preferences of subnational politicians, for example, with respect to the degree of the centers discretion. The model is tested on five Latin American countries that, although formally decentralized, in fact exhibit wide differences in the distribution of spending and revenue responsibilities. The theory also helps explain a number of problems governments have encountered in decentralizing, including subnational debt crises and a mismatch between responsibilities and resources.

The political economy of financial internationalization in the developing world

In the last decade a growing number of developing countries have opened their financial systems by liberalizing capital flows and the rules governing the international operations of financial intermediaries. One explanation of this rush toward greater financial internationalization is that increasing interdependence generates domestic and foreign political pressures for capital account liberalization. While we find evidence for that hypothesis, we find that the proximate cause in developing countries more frequently is found in balance of payments crises. Politicians perceive that financial openness in the face of crisis can increase capital inflows by indicating to foreign investors that they will be able to liquidate their investments and by signaling government intentions to maintain fiscal and monetary discipline. The argument is explored through case studies of Chile, Indonesia, Mexico, and South Korea.

Institutions and growth in East Asia

Institutions have played a central role in political economy explanations of East Asia’s growth, from the developmental state to the micro-institutions of industrial policy. A review of these institutional explanations finds that few if any of the postulated institutional explanations involve either necessary or sufficient conditions for rapid growth. This finding suggests two conclusions. First, there are multiple institutional means for solving the various collective action, credibility, and informational problems that constitute barriers to growth. The search for a single institutional “taproot” of growth is likely to be a misguided exercise, and more attention should be given to understanding the varieties of capitalism in East Asia. Second, institutions are themselves endogenous to other political factors that appear more consequential for growth, including particularly the nature of the relationship between the state and the private sector.

Globalization, Democracy, and Effective Welfare Spending in the Developing World

The literature on the effects of globalization on social policy and welfare, and the parallel literature on the effects of democracy, operate in mutual isolation to a surprising degree. This article extends the debate on the welfare state in the developing world by examining the social policy reactions of democratic and authoritarian governments to globalization. Using unbalanced panel data on 57 developing nations, and considering social security and health and education spending, the authors examine whether democratic and authoritarian regimes exhibit similar or different social spending priorities in the context of increasing economic openness. The results show that social spending in “hard” authoritarian regimes is more sensitive to the pressures of globalization than in democratic or intermediate regimes.

The politics of adjustment: lessons from the IMF's Extended Fund Facility

The international debt crisis has forced painful economic adjustments on the developing world. In the short run it has forced governments to seek to correct payments imbalances through stabilization programs, usually undertaken with conditional assistance from the International Monetary Fund (IMF). The crisis has also revealed deeper weaknesses in many Third World economies, weaknesses demanding more basic reforms in the structure of incentives, prices, and investment.

The institutional foundations of hegemony: explaining the Reciprocal Trade Agreements Act of 1934

In 1930, Congress approved the highly restrictive Smoot–Hawley tariff, the textbook case of pressure group politics run amok. Four years later, Congress passed the Reciprocal Trade Agreements Act (RTAA), surrendering much of its tariff-making authority to a policy process in which internationalists had increasing influence. While the United States had used reciprocity to expand exports before, the stick of discriminatory treatment took precedence over the carrot of liberalizing concessions. With the transfer of tariff-making authority to the executive, the United States could make credible commitments and thus exploit its market power to liberalize international trade. Despite later modifications, the RTAA set the fundamental institutional framework for trade politics.

Inequality and Regime Change: Democratic Transitions and the Stability of Democratic Rule

Recent work by Carles Boix and Daron Acemoglu and James Robinson has focused on the role of inequality and distributive conflict in transitions to and from democratic rule. We assess these claims through causal process observation, using an original qualitative dataset on democratic transitions and reversions during the “third wave” from 1980 to 2000. We show that distributive conflict, a key causal mechanism in these theories, is present in just over half of all transition cases. Against theoretical expectations, a substantial number of these transitions occur in countries with high levels of inequality. Less than a third of all reversions are driven by distributive conflicts between elites and masses. We suggest a variety of alternative causal pathways to both transitions and reversions.

Institutions and Economic Policy: Theory and a Korean Case Study

Recent writing on the rapid growth of the East Asian newly industrializing countries—Korea, Taiwan, Hong Kong, and Singapore—has been dominated by an institutionalist perspective that focuses on the “strength” of the state vis-a-vis societal actors. A study of Koreas stabilization efforts in the 1980s underlines the importance of organizational factors in explaining policy outcomes, but also suggests important limits on institutionalist arguments. These include the absence of unique institutional solutions for political problems and the indeterminacy of institutional configuration with respect to the economic efficiency of policy. A focus on characteristics of the state alone can overlook the organizational resources of societal actors and the interest of politicians in building bases of support even in “strong” states.

The Challenges of Consolidation

As the recent wave of democratization crested in the 1980s, skeptics questioned the capacity of new democratic governments to manage the daunting political challenges of economic reform. It was thought that either reform would undermine democracy by placing undue strains on fragile polities, or democratic politics would undermine the coherence of policy, generating a downward economic spiral. Concerns about democratic breakdown and policy stalemate remain salient in many parts of the world, particularly the new republics of the former Soviet Union. By the 1990s, however, newly established democratic regimes in many developing countries had initiated deep and wide-ranging economic reforms. The early democratizers of Southern Europe are now firmly ensconced in the European Union, having undertaken important economic adjustments required for their admission. In Latin America, longstanding development strategies have been reversed by fundamental shifts in economic policy: deep fiscal and exchange-rate adjustments, reduction of trade barriers, and privatization of state-owned enterprises. The trade-oriented countries of East and Southeast Asia did not experience crises of the same magnitude, but in the Philippines, Korea, Taiwan, and Thailand, the trend toward political liberalization has also coincided with the initiation of a new round of economic policy changes. And, of course, most of the postcommunist democracies of Central Europe have inaugurated massive--and wrenching--market-oriented reforms. The changes in all these regions and countries have been