Browsing by Subject "Global and Political Economy"

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  • Liukkonen, Jani (Helsingin yliopisto, 2021)
    This thesis aims at researching the recent history of the EMU and the monetary policy shift of the ECB in addition to its presidents roles in shaping the economy. This thesis will provide background information on the economic constitution of the EMU and how it has transformed over the course of Euro crisis and the years after. Additionally, the monetary policy actions of the ECB amongst Euro crisis and the COVID-19 pandemic will be studied. I argue that by transitioning to an expansionary monetary policy earlier than originally happened, some of the more severe economic impacts of the Euro crisis could have been prevented and it would not have led to a lost decade for the growth of the Eurozone. Additionally, I argue that the central bankers' implications for molding our future is enormous as it is clear that market actors react to their statements. My research questions are as follows: What problems or flaws have been identified within the EMU and how could they be improved? What are the presidents’ implications and effects on influencing the economy? Furthermore, how has the shift of the ECB monetary policy from hawks to doves happened over the years? This thesis utilizes critical discourse analysis in researching the materials, which comprise of the presidents annual hearings before the Plenary of the European Parliament, with the exclusion of the last nominated president as she has only been through one. In her case, quarterly Economic and Monetary Committee hearings will be utilized. The key findings suggest that the ECB presidents have viewed the EMU flawed and have emphasized the completion of the union as too much responsibility has been left for the ECB. The call for more fiscal capacity is repetitive for all three presidents. Furthermore, this research also suggests that the shift from hawks to doves happened because no other way was seen. Additionally, the roles of central bankers have been heightened during the recent history and it shows that they have a great influence on the economy based on the reactions by the market actors and the public.
  • Vuolle, Vesa (Helsingin yliopisto, 2020)
    Market reforms in the European Union (EU) are cramped between two connected, albeit divergent forces. First, policies are contested in the multilateral EU-sphere, and later refined and adjusted in heterogeneous national implementations. Neste, an industrial company, gained a monopolistic market position to a certain renewable diesel fuel in the aftermath of the EU’s Renewable Energy Directive 2 (RED II) implementation in Finland. This research aims to find out what led to this outcome. For the examination of these phenomena, this paper draws on the literature of market organization, policy implementation, and evolutionary economics, which offer us insights into market reforming in an era of marketization and climate change adaption. Also, in the course of the research text, the politically contentious nature of biofuels is unwrapped. This research aims at extending the understanding of unintended consequences of multiscalar sustainable regulations. This thesis applies an outcome explaining variant of a causal method called process tracing, which seeks to answer the question “what led to the outcome Y”. Through relevant causal process observations, this research is built into a context-specific and multifactor study. The data used here consists of secondary sources, including parliamentary reports, and the results of a stakeholder hearing that was organized around the directive implementation in Finland in 2018. Throughout the research, relevant counterfactual conditional questions are presented in light of the causal process. Asking these if-questions highlights the deliberative and political nature of the instalment of the RED II. The analysis shows that Finland’s commitment to the United Nations Paris Climate Agreement goals through the RED II is the likeliest cause for the resulting monopoly. However, we cannot fully exclude the 
Finnish parliament’s implicit motivation for monopoly-creation, but it is unlikely. The research also considers Neste’s successful entrepreneurial innovation activity as a contributing, although not an explaining factor. The study concludes that the outcome in question was an unintended, but not inevitable consequence of a sustainability directive implementation.
  • Mustakallio, Vili (Helsingin yliopisto, 2020)
    This study examines the climate responsibility, a sub-category of corporate social responsibility (CSR), of two oil companies, ExxonMobil and Shell. The study is a comparative case study of the climate responsibilities of two private oil companies, that makes use of academic literature and recent primary sources of the case companies, such as sustainability reports and statements. The study has a theoretical emphasis, and at first, it discusses the theoretical debates involving CSR. The separation of ownership and control in corporations that occurred in the early 20th century enriched the later discussion about the contradictions between capitalism and CSR, which was emerging slowly. From the 1970s, the practice of CSR became more familiar, and for instance, the orthodox liberal viewpoint became more positive about it: It was possible to combine profit-maximizing and CSR. Later, in the 21st century, governance studies gave a new perspective on interdisciplinary CSR studies. The study shows that climate responsibility might differ extensively between two same-sized oil companies. ExxonMobil’s climate responsibility has changed in the past twenty years: First, the company doubted whether climate change was true. Later, it admitted that it is a fact, and the company has committed to the Paris Climate Agreement. However, it commits to greenwashing regarding finding solutions. The company emphasizes its expertise and authority and is against government climate regulation. For ExxonMobil, the responsibility remains on the level of talk. It is not attempting to withdraw from oil. Shell’s climate responsibility, however, materializes in practice, too, even though the company has committed to greenwashing in the past. Shell has invested substantially in renewable energy sources and states that it aims to transform its business model to correspond with ambitious climate objectives. Further, contrary to ExxonMobil, Shell relies on a climate scenario, which follows an estimate that global warming from the pre-industrial era will not exceed 2°C. The study underlines that instrumental factors can explain the forms of corporate climate responsibility. However, the study does not exclude institutional, relational, nor philanthropic reasons for climate responsibility. This study discusses broad instrumentalism, which includes profit-maximizing and pursuit of corporate power. Profit-maximizing explains the form of climate responsibility that both companies practice. ExxonMobil’s climate responsibility speech is explained by maintaining a reputation and advertising matters, that is, short-term profits. However, its climate responsibility in practice remains modest, even irresponsible: The company is not withdrawing from oil nor investing in renewable energy sources. That is because, whereas the new oil resources are becoming harder and harder to exploit, ExxonMobil has relatively large oil resources compared with other oil companies. In turn, Shell’s climate responsibility is explained, especially by the long-term profits. Shell has relatively low oil reserves. Thus, it prepares for future regulation and positions as a progressive actor regarding energy transition to maximize profits in the 22nd century. Also, the case companies differ in the way they pursue corporate power. In the case of ExxonMobil, its climate responsibility speech is an attempt to pursuit corporate power against government regulation and to obtain autonomy. On the other hand, in climate issues, Shell highlights cooperation with the government and other stakeholders instead of self-regulation through its CSR. In the end, the thesis discusses the implications of the results to a broader question of global climate governance. When sustainability has become a growing business, and there are challenges in global climate governance, it is important to recognize the limits of climate responsibility, and more broadly, the limits of corporate social responsibility as a long-term solution. However, in the short term, the climate efforts of corporations are necessary to fill the regulatory gaps of global climate governance.
  • Marjomaa, Anni (Helsingin yliopisto, 2020)
    This thesis aims at developing plausible visions of future for the eurozone, based on a literature review and scenario methodology. The starting point of the analysis is the global financial crisis of 2008, which turned into a European balance-of-payment crisis in 2010. In the early 2020, COVID-19 pandemic ushered in a new crisis for the eurozone. The survival of the euro seems more uncertain than ever before. Thus, it is a timely effort to explore the various theories of the root causes for the troubles of the eurozone. The research question of the thesis is the following. Utilizing scenario methodology, what kind of plausible futures can be envisioned for the eurozone? Is there a viable future for the EMU or is it doomed to fail due to its alleged flaws? What are the conditions in which the eurozone can prosper and the euro to become a well-functioning common currency? The hypothesis is that the future of the eurozone is extremely uncertain without significant social and fiscal reforms. To tackle these questions, various theories and perspectives on the problems of the euro are reviewed. Despite the different views, there seems to be a consensus regarding the fact that the euro has failed in terms of the main objectives of the common currency, namely bringing prosperity and stability through economic integration and accelerating political integration. Quite the contrary, it has worsened the standards of living and created instability and deep political fragmentation across Europe. The thesis utilizes scenario methodology as it is particularly suitable method for examining uncertain contexts. The scenarios are based on a literature review, which is further analysed from the author’s perspective and developed into plausible scenarios for the future. It is argued that scenario methodology is a fruitful way to conceptualize uncertain future and potential shocks it may hold, while producing novel academic insights and interesting research. The scenario-building exercise demonstrates how the different theories and views on how the EMU should be governed and reformed may play out in practice. Each scenario reflects certain school of thought that entails specific elements of reform and governing principles for the EMU. The paper demonstrates that there are conditions in which the euro can survive and even prosper. On the other hand, there are conditions in which the euro is doomed to fail due to its design flaws and lack of social integration within the eurozone. The scenarios in which the EMU prospers include aspects of social integration and banking integration. Vice versa, the scenarios in which the EMU cannot survive are characterized by lack of social and banking integration. The key finding is that for the euro to survive, social integration in Europe must deepen. In other words, any meaningful reform in the eurozone structure requires increased solidarity within the union. There is a growing consensus between leading economists that the most important structural reform would be some level of debt mutualization and restructuring. The second conclusion is the importance of banking integration, which would enhance financial stability in the eurozone through common standards and harmonize the banking regulation between the member states. Banking integration also requires deepening solidarity in the EMU, so it cannot fully realize before social integration moves forward.
  • Tsokkinen, Riku (Helsingin yliopisto, 2019)
    This study employs an exploratory look into the immigration policy in the contemporary Japan, in the light of an ongoing demographic transition. As the native Japanese population ages, the government officials have turned their attention towards foreign labor to fill the labor deficits in several working sectors. The scrutiny in the study focuses on examining the immigration policy environment and the government operations in increasing the international labor mobility in Japan. The exploratory approach in the study reflects the aspirations of the study to act as a groundwork for further research of the topic by creating hypotheses of the matters examined. Through the use of an analytical framework and a rational logic model based on policy analysis, the study analyzes the Japanese governments immigration policy plan from 2015 and the implemented policies until second quarter of 2019. The examined material is comprised of official publications from the Japanese Ministry of Justice. The results of the study show a set of distinguishable tendencies of the immigration policy in the second decade of the 21st century; a clear preference for highly skilled foreign labor over less skilled one, reluctance of major reforms in opening the labor market for foreign labor, lack of centralized support for multicultural coexistence, preferential treatment for Japanese descendants, and the election of time-limited measures to tackle labor deficits. The study concludes, that even after the realization of the demographic change and the labor deficits by the Japanese officials, the opening of the labor market for the foreign labor remains constricted. Of the immigration policies, the trainee programs show major potential in attracting the low and medium skilled labor, the type of labor most required, and the further revision of the program could promote it to be a cornerstone for increasing the international labor mobility in Japan.
  • Bassett, Eli (Helsingin yliopisto, 2020)
    The platform economy has emerged in the past two decades to become a remarkably profitable and increasingly global industry. The explosive growth of platform firms can be attributed to the outsourcing of almost all aspects of business operations to minimize costs. This is coupled by their motivation to grow rapidly to capture disproportionately large market shares. Consequently, platform firms have become global behemoths, and the labor which sustains their growth has come to be known as “gig work”, in which self-employed contractors work whenever they please, without the traditional protections provided to formal employees. The goal of this dissertation is to explain these mechanisms in relation to their potential impacts on income inequality. This dissertation tests two hypotheses: the outsourcing hypothesis and market concentration hypothesis. Each hypothesis proposes a causal chain whereby outsourcing and market concentration in the platform economy lead to disproportionate economic power and greater economic insecurity, and consequently links these outcomes to a double movement in the U.S. income distribution. Methodologically, this research employs contrastive comparisons, whereby exemplary platforms are compared with their traditional competitors, namely Uber with the taxi industry, Amazon with Walmart, and DoorDash with Domino’s Pizza. From these contrastive comparisons, evidence is gathered to demonstrate key differences between platforms and their traditional competitors. Additionally, this research is contextualized in terms of historical and ideological trends, particularly the gradual re-emergence of income inequality and the development of neoliberal hegemony. The findings demonstrate that through unique combinations of the hypothesized mechanisms, platform businesses do proliferate greater economic insecurity, and generate disproportionate economic power between platform providers and platform managers and owners. However, evidence directly linking these outcomes to downward or upward pulls in the U.S. income distribution remains inconclusive. That said, substantial evidence was found for the rejection of the outsourcing hypothesis. Evidently, given the complexity of social systems, the findings from this research may be inherently difficult to generalize on a global or systemic level. As such, I conclude that further research is necessary to draw more decisive and generalizable conclusions regarding the interplay between income inequality and the platform economy.
  • Pagkratis, Niko (Helsingin yliopisto, 2020)
    The aim of the thesis is to explore whether John Rawls’ theoretical concept of property-owning democracy can potentially inform novel avenues in the current debate regarding economic inequality. This concept is used in the thesis to scrutinize the role of property ownership in liberal theory and advocate for a broader, and more equal, interpretation regarding the role of property. More specifically, the attempt is to show that in Rawls’ property-owning democracy there is a possibility for a more equal basis for ownership, which can also enhance broader economic equality. The methodology employed in the thesis is that of concept analysis, which is used to critically examine how some of Rawls’ theoretical concepts have been understood in the academic literature and whether there are more accurate interpretations regarding these concepts. Hence, the aim is to focus on Rawls’ theory’s economic component in the form of property-owning democracy. Furthermore, Rawls’ overall impact amongst mainstream economics is highlighted in order to disclose the narrow nature in which his theory is understood amongst most economists. This narrow interpretation of Rawls’ theory is exemplified by the focus on a single aspect of the theory, namely, the decision theory rule of maximin. However, closer scrutiny reveals that Rawls formulates a complex theoretical structure that aims to formulate macro principles instead of focusing on micro principles. One of the main findings of the thesis is that through Rawls’ property-owning democracy, one can see there to be more space in the liberal political tradition towards greater economic equality than traditionally supposed. This is manifested by the requirement in Rawls’ property-owning democracy for a significant degree of equality in the ownership of the means of production. The importance of equality in Rawls’ theory makes radical interpretations also possible. For instance, Rawls’s property-owning democracy is in accordance with John Stuart Mill’s idea of worker managed firms. Therefore, the ownership and organization of the means of production is potentially a concrete area of improvement where greater economic equality could be achieved. Another interesting finding is that mainstream economics, with utilitarian philosophy as its backbone, seems to have forgotten the question regarding the ownership of the means of production and assumes it to be naturally privately held. One explanation for this is that the paradigm change in economics, from classical political economy to neoclassical economics, also meant shifting focus from the question of ownership of production to other avenues. As a result, questions regarding utility maximization became the focus of attention. The thesis shows that questioning underlying assumptions regarding issues such as economic inequality are crucial in order to properly understand and analyze the issue further. Rawls’ input in this regard is that he emphasizes the normative context, namely, the need to have clear political and moral arguments regarding justice. Therefore, it is important to scrutinize and formulate clearly what are the underlying principles for a just society instead of assimilating principles at face value. In the context of concrete policy outcomes, assuming certain principles without scrutiny also informs policy outcomes that can be detrimental for greater economic equality.
  • Koskela, Riina (Helsingin yliopisto, 2021)
    The language we use when we talk about terrorism has an important role to play in the discursive construction of terrorism. Thus, how terrorism is perceived in the media, politics and official public discourses influences how we perceive terrorists to be. The constructive perspective of terrorism does not deny the existence of it: terrorism is real, but what it means depends on the interpretations. Counterterrorism also depends on these interpretations of terrorism. Therefore, it is argued that how states perceive ‘terrorism’ impacts their counterterrorism measures and policies. The overall aim of the study is to examine the interplay between terrorism and counterterrorism. The focus is on understanding how terrorism is perceived in the official public discourse of terrorism within the context of the UK’s counterterrorism strategy ‘CONTEST’ and contemporary terrorism since 9/11. Another layer of the argument concerns how the discursive practices constitute terrorist Other and thus, how the perceptions of terrorist Other constructed by the Self reproduce, reinforce and constitute behaviour, interests and identity of the Self. The aim is not to understand terrorist Other, but rather to analyse how Other is constructed by the Self and what effects this has on the Self. In this study, the UK occupies the role of Self, and contemporary terrorism, as perceived by the Self, represents the Other. The theoretical background of the study is on critical terrorism studies, constructivism by Alexander Wendt and securitisation theory. The research material consists of four different versions of the UK’s counterterrorism strategy CONTEST from the years 2006, 2009, 2011 and 2018. CONTEST provides comprehensive research material for this study because it sets the general agenda of counterterrorism aims, measures and policies in the UK. In the first part of the analysis, the study identifies five different perceptions of terrorist Other utilising critical discourse analysis by Norman Fairclough. The five perceptions of terrorist Other are active, different from the Self, radicalised, a non-state actor, and finally, an enemy. Based on these five perceptions of terrorist Other, the second part of the analysis then focuses on the interplay between terrorist Other and Self. The perceptions of terrorist Other are argued to reproduce, reinforce and constitute Self’s behaviour, interests and identity, and therefore influence on the counterterrorism practised by the UK. Analysing how terrorism is perceived through the construction of terrorist Other provides a broader understanding of the official public discourse of terrorism in the UK. In addition, the study argues that Self decides its actions by reflecting on the perceptions of terrorism it has created itself. Therefore, constructing terrorism as represented might partially explain counterterrorism measures and policies in the UK.
  • Saarnio, Tommi (Helsingin yliopisto, 2021)
    The importance of global regulation in the field of trade and investments is stronger than ever. Globalization has created a deep global integration, where capital is highly mobile, crises are more common and inequality is at unprecedented levels. Currently, the World Trade Organization (WTO) is trying to reform its operations and looking for a way forward during a period of an intense debate between the neoliberal ideology and feasible alternatives. This thesis investigates the creation and provisions of the International Trade Organization (ITO) and compares it to the WTO. It seeks to show how the ITO can provide fresh ideas and solutions to the contemporary challenges. This thesis utilizes comparative analysis to examine the investment regulation in the two organizations. More generally, this thesis is influenced by the critical realist approach to social sciences. The primary sources for the analysis are the Havana Charter, the Agreement on Trade-Related Investment Measures (TRIMs) and the General Agreement on Trade in Services (GATS). The comparative analysis indicates that there are major differences in the treatment of investments between the ITO and the WTO. First, the TRIMs and GATS Agreements tend to support the WTO’s main objective of liberalization, which stems directly from the neoclassical theory. In contrast, the Havana Charter appears to be a more heterodox from the perspective of economic theory. In addition, the findings suggest that the Havana Charter is more development-friendly, has more balanced regulation between investors and host countries, and regulates also private actors, such as multinational corporations. From the end of the 20th century until this day, liberalization has reigned in the trade and investment domain. It is argued that in the future, more emphasis should be put on a wide variety of issues to support sustainable and inclusive development. Furthermore, it is suggested that the ITO points towards global Keynesianism, which could serve as an adequate path towards a better governance of global trade and investments in the 21st century.
  • von Pfaler, Lauri (Helsingin yliopisto, 2020)
    This thesis investigates the history and consequences of the post-WWII naturalisation of capitalism. It draws centrally on social history of political thought, an approach to intellectual history developed by Ellen Meiksins Wood and Neal Wood, and situates the transformations that turned economic history into neoclassically-oriented historical economics ‒ the most fundamental example of naturalisation in the period under investigation ‒ in their wider socio-political context. The aim is to understand the politics of concept-formation and discipline reconstruction. The thesis presents the commercialisation model, the central naturalising account of the origins of capitalism. It equates capitalism with trade, markets, and towns, and explains its emergence circularly by capitalist phenomena and dynamics. Capitalism becomes universal, a naturalised and expected development that is only impeded by political or cultural fetters. In contrast, the thesis claims that capitalism is a historically specific arrangement of social relations, norms, and practices. The characteristics that are both specific and have been historically central to it are account for by a brief history of their unintended emergence as a result of class conflicts in the medieval English countryside. The thesis then considers the absence of capitalism as an analytical and historical concept in the specialised discipline of the economy. Thereafter, it presents the building blocks of historical economics: an abstract concept of the market as an information processor, reified notions of information and choice, and mathematics. All emanate from post-WWII economics, and the origins of the first three are traced to the twentieth-century struggle against collectivism and Marxism. Next, the thesis situates the construction of historical economics, a universalising and increasingly ahistoricist field, in the socio-historical context from 1950s onwards, emphasising important similarities with neoliberal thought and Friedrich Hayek. Two disciplinary developments are shown to be crucial. The first, cliometrics, is constituted by the direct use of neoclassical economics to study history. The second, new institutional economics (NIE) is a product of the 1970s. NIE claims to be more realistic and historical than neoclassical economics, but shares its naturalising impulses with the former. It is actually a more powerful tool of naturalisation because its framework allows the explanation of the social in terms of the economic. The transformations had profound implications for the understanding of capitalism. The theoretico-methodological framework ensures that historical economics projects aspects that are historically specific to capitalism onto non-capitalist historical contexts. Consequently, the latter is portrayed as qualitatively similar to the former in a way that re-embraces and refines the older commercialisation thesis: markets and private property are naturalised; relative price changes become the motor of history; and capitalism ‒ or a variant of its conceptual ‘place-holders’ ‒ is argued to only have alternatives that end in tragedy. Finally, the policy implications of naturalisation are assessed.
  • Pelkonen, Aleksi (Helsingin yliopisto, 2021)
    This thesis assesses the relative performance of different theories of money in the contemporary world economy. This thesis aims to qualify some of the claims of Modern Monetary Theory (hereafter MMT) by assessing how accurate the theory is as a description of money. Furthermore, it seeks to more precisely define ‘the state’ as a political entity in order to more fully qualify some of the constraints a state’s currency may face. Three theories of money are discussed: the commodity theory of money, the positioning theory of money, and the credit theory of money (the last of which is compatible with MMT). Three authors’ work are analyzed that each advocate for one of the three theories. These theories are assessed according to their relative concordance with historical evidence. It also assesses some of the consequences for economic analysis that emerge as a result of these different conceptions of money’s functions. A theory of the state postulated by Bob Jessop is adapted for identifying constraints on states’ currencies under the assumption that the credit theory of money (MMT) is accurate. The performative effects of the commodity theory of money and expectations of appropriate state behavior limit the fiscal policy space of states beyond that which is proposed by MMT. Further limiting the fiscal policy space of states is the global free-trade system, which imposes a structural need for some states to earn foreign currency reserves so that they can produce and procure essential economic goods. The thesis concludes by suggesting two paths forward to resolve these limitations. The first involves reframing public economic discussions by using MMT’s metaphors; the second suggests a return to discussions of managed global trade governance, for example John Maynard Keynes’ “Proposals for an International Clearing Union.”