Prior to the 1986 Maxi Trials, relatively little was known about the Sicilian Cosa Nostra. Its omertà, or code of honor, had held strong. But the success of the trials was only possible through the testimony of pentiti, or turncoats, at the expense of the code of honor. What caused this breakdown? As the organization became increasingly globalized, the older bonds of trust and honor that originally defined the omertà became weaker, facilitating the conditions for defection. The effects of globalization are visible in five areas: profit-making opportunities, organizational structure, the code of honor, political ties, and the anti-mafia movement. The Cosa Nostra’s continued existence today has implications for perceptions of the Italian government's legitimacy.
This article explores the rising tensions between China and Japan centered on their competing claims over the Senkaku/Diaoyu Islands. The uninhabited islands have been under Japanese control since 1972, and the two nations had agreed to set the controversy aside for several decades in the interest of diplomatic harmony. However, China has begun to press its claim to the islands more forcefully in recent years as Chinese national power has grown. The dispute has emerged as the focal point in the broader Sino-Japanese strategic rivalry. China’s meteoric rise has fueled rising nationalism within China and led to more assertive Chinese behavior throughout East Asia. Tensions over the islands are likely to continue to grow, and the risk of an armed confrontation in the East China Sea is real. A conflict would be highly damaging to both nations’ economies, and both sides have an interest in avoiding such an outcome, but it remains unclear whether a peaceful resolution of the dispute can be achieved.
This paper focuses on the consequences of financial liberalisation and monetary integration on the two largest economies of Southern Europe, Italy and Spain. As part of the European project of financial liberalisation that was pushed forward with the 1992 agenda and the introduction of the single currency in 1999, these economies found themselves facing new challenges in economic policy-making. Given the dismal economic performance in recent years of the so-called Southern ‘periphery’ unveiled by the financial crisis in 2008, the aim of this case study is to understand why the benefits of liberalised financial systems and monetary union did not fully materialise. By showing how European financial and monetary integration provoked large-scale capital inflows, which led to distortions that were difficult for policymakers to control in Italy and Spain, the paper challenges the dominant narrative that the profligacy of Southern governments was simply to blame for the crisis.
This research sheds light on the U.S. government’s efforts to petition media professionals not to report on U.S. data surveillance and military engagements. After 9/11, warrant court based U.S. surveillance practices morphed into warrantless U.S. surveillance activities, and poor journalistic working standards led to a chilling effect in government-media relations during the Obama administration. This analysis illustrates the influence of media reports on the U.S. government in times of unclear U.S. policies. The findings of this paper underline the fact that journalistic non-compliance with governmental secrecy requests prevents our societies from becoming distopic democracies.
There is no definitive answer as to the impact on a country’s macroeconomic indicators of joining the Eurozone. There is little impact on a country’s trade dependence. Peripheral countries suffered in terms of unemployment, but weakly gained in terms of incomes. However, no doomsday image emerges. While this appears to limit the short-term economic upside of the currency union project, it brings into the forefront the Eurozone’s aforementioned political considerations: eliminating competitive devaluations, having a common European monetary voice and tightening economic and political bonds within Europe. If this appeals to a prospective Eurozone member, they should not hold back for economic fears.
Ecuador thought they would shock the world into action with their call for international funding to prevent the exploitation of oil reserves under their Yasuní-ITT National Park. The response was silence and inaction. Why? This paper examines Ecuador’s Yasuní-ITT Initiative that sought to share the costs of preserving the Amazon Rainforest and its apparent failure through the lenses of collective action theory and cost-value analyses. While the initiative was unsuccessful this time around, with some adjustments it could prove a useful model for future conservation efforts.
This paper examines why productivity, as measured by output per work hour, has not increased significantly during the current Digital Revolution, despite rapid and intense technological progress and the influx of new inventions. The failure of technological progress to bring immediate increases in productivity and standards of living is paradoxical from an economic view. This paper presents statistical data on productivity and gross domestic product (GDP) growth across a number of economies for the past 40 years. Following that, it reviews several economic and history of science and technology theories about the current lower than expected productivity, including its possible relations to the initial delay in productivity growth during the Industrial Revolution of the late eighteenth century and the Technological Revolution of the early twentieth century. It then presents several explanations for the delay in productivity growth that are specific to the Digital Revolution.
According to the UNHCR, 75,000 people attempted to cross the Mediterranean in the first six months of 2014 with 800 dying before reaching land. Yet people still insist on making the journey. On the other side of the Mediterranean is the European Union, which persecutes some who have survived the journey while providing sanctuary to others. It is high time for European Union member states to work together to find a durable and sustainable solution to the situation in the Mediterranean. This paper briefly discusses the main reasons migrants embark on such a perilous journey and suggests elements of a strategy to address this issue.
More than a decade since the vicious battle between Gucci and Bernard Arnault’s Louis Vuitton Moët Hennessy, this case remains an important case study in the failure of smart men to make measured choices. What led such wise men to fall prey to multiple mistakes and ultimately to the disintegration of negotiations? The work of the Harvard Negotiation Project and Robert Axelrod help elucidate the areas in which the characters involved could have acted differently. The consequences of the case highlighted the new interconnectedness of global financial and corporate markets. Today, luxury goods conglomerates cite this case as one of the most important in the history of fashion.
A consideration of NASA's asteroid observation mission highlights the possibility that for rare events observation is not unambiguously positive. Although measurement is beneficial in the long run, and is required for eventual risk management or mitigation, it may at first actually increase the expected value of the risk. In the case of the asteroid mission, observation created a substantial risk of false positives that greatly outweighed the initial potential risk reduction from early warning or asteroid diversion, such that the total risk increased. These dynamics are explored with a simple model that can be extrapolated to improve the risk calculation for any rare threat.
This paper portrays the Spanish transition to democracy in the context of selected systems and negotiation theoretical arguments. Transition leaders’ ability to think in systems and to conceive a framework for negotiations centered on shared interests and common goals was crucial for the success and durability of the process. However, the common view of the Spanish transition as a sheer “success story” falls short of recognizing the sacrifices that were made to achieve peaceful transformation of the political system. In fact, the transition compromise engendered severe problems that strain the Spanish State and the political process until the present day.
Ventures selling distributed electricity directly to impoverished consumers achieve affordability by minimizing up-front prices and collecting post-sale revenue. Through interviews with 30 practicing entrepreneurs operating at the base of the pyramid (BoP), we evaluate two pricing methods, micro-finance and pay-as-you-go, that accomplish this task. Each of these methods has implications for other aspects of the venture’s business model. With further research, these models might be adapted to other undeveloped sectors around the world that also lack infrastructure and competition.
Katy Frank was employed as a lead instructor for the Refugee Affairs Division at the U.S. Department of Homeland Security (DHS). She is a subject matter expert in U.S. refugee law, policy, and processing having designed and delivered curricula on topics such as refugee law, U.S. immigration law, interviewing skills and cross-cultural communication. The following is the text of a written interview with her conducted by the SAIS Europe Journal Staff.
This article explores the rationale behind the 315 billion euro spending program of the European Union called the ‘Juncker Plan,’ and expands upon the analytical framework of McNamara in her 1998 book, "The currency of ideas." Policy elites believed that, at the member state level, Keynesian counter-cyclical fiscal expansion was an ineffective policy tool. This led directly to the creation of new budget rules for European Union member states under the European Semester and the Macroeconomic Imbalance Procedure (MIP). The Juncker plan is the product of the constraining institutions created before the shift towards Keynesian demand management -- which makes an expansionary fiscal policy at the Union level the logical path out of the crisis.
In the fall of 2014, the United States Secret Service was the subject of much scrutiny in the wake of an embarrassing string of compromises to President Obama’s safety. This article seeks to determine if such criticism was warranted through an analysis of the flawed risk model that lead to the 1995 assassination of Israeli Prime Minister Yitzhak Rabin. Even though there was ample evidence portending this risk model’s impotence, it was not put to good use because of the Shin Bet’s (Israel’s equivalent of the Secret Service) focus on a priori experience with little consideration for a posteriori knowledge, most likely caused by Daniel Kahneman and Amos Tversky’s so called “conjunction fallacy.” Ultimately, I conclude that Rabin’s assassination was the result of a seriously flawed understanding of risk, one thankfully not shared with the contemporary Secret Service.
We are proud to introduce our readers to SAIS Europe’s new director with this interview. Michael Plummer, himself a 1982 SAIS graduate, has been the Eni Chair of International Economics at SAIS since 2008 and has taken on the role of SAIS Europe director as the Bologna campus marks its 60th anniversary this year. He is a distinguished economist, who has served as the head of the development division of the Organization for Economic Cooperation and Development (OECD) and editor-in-chief of the Journal of Asian Economics. Prior to SAIS, Plummer was an associate professor at Brandeis University, also serving as the Director of M.A. programs at the university’s Graduate School of International Economics and Finance, now known as the International Business School. (Interview transcript has been condensed and edited for publication)
The academic debate on whether world income inequality is rising or falling has reached a stalemate: parties are unable to agree on the analysis of these economic world trends. This commentary examines recent research that supports the opposing “convergence” and “divergence” camps to examine the origins of the debate, and to determine why consensus is so difficult to reach. While this analysis concludes that the main driver of disagreement is calculation methods and data, that conclusion poses a key question: Is studying world income inequality useful?