Geoeconomics

Just over three decades ago, a new era appeared to have dawned in Europe: The Cold War had wound down, the Soviet Union’s empire had broken apart, and democratic capitalism stood poised to sweep aside ossified communist systems. This article uses geographic markers in the most recent wave of the Integrated Values Survey to show that, within Russia, the drop in a region’s electoral support for Boris Yeltsin between the presidential elections of 1991 and 1996 strongly predicts its degree of illiberalism in 2017. On balance, where faith in the politician who launched marketization and democratization declined most dramatically is where we continue to observe the greatest skepticism for his liberal project. The pattern laid down in the early 1990s persists.

Sub-Saharan Africa ranks as one of the world’s poorest regions. The causes of this are exceptionally complex, with political instability, lack of security, low levels of education, poor access to infrastructure and lack of integration into global trade networks as the leading explanations, among others. In recent decades, economists and agricultural development experts have been looking for ways to increase agricultural productivity in Sub-Saharan Africa through improved seeds, fertilisers and more modern farming technologies. This article looks at the measures in question, what has been done so far, and how scientists assess the effectiveness of these measures on agricultural productivity and poverty reduction. Finally, we present concrete recommendations.

The US Inflation Reduction Act (IRA) promotes renewable energy and contributes to climate protection, but also offers generous tax credits and subsidies to incentivize production in the United States. While the planned generosity of the program has sparked an intense debate about potential negative spillover effects on the global economy, little is known about the quantity of potential adverse effects. In the new EconPol Policy Report the authors conduct a large-scale international survey among leading economic experts worldwide to quantify the effect of the US Inflation reduction act on the global economy. On a global scale, experts are little concerned about negative effects of the IRA on their domestic economy, estimating both the impact on national output and the risk of business outflows to be low. However, we uncover large heterogeneity in the potential impact of the IRA across countries and regions. In Europe, particularly in France and Germany, economic experts are highly concerned about the IRA and expect a significant effect of the IRA on the domestic economy. In terms of economic policy reactions, roughly 41% of the respondents support economic countermeasures.

In the light of geopolitical conflicts and instability, sanctions play an important role in the international economic policy debate - especially against countries such as Russia, Iran and China. Economic sanctions are often intended to achieve foreign and security policy goals: fighting terrorism, protecting democracy and human rights, or resolving conflicts. In this issue of EconPol Forum, our authors examine, using the evidence-based studies, the extent to which various sanctions have achieved their goals. How do they affect economic growth, trade, and prosperity? In addition, we want to understand their impact on sectoral development of agriculture, energy and mining, as well as on human rights, military spending or life expectancy. In this context, international trade, financial transactions, technology transfer and other economic activities, among others, are systematically studied. And researchers look at different types of sanctions, such as unilateral, multilateral, and extraterritorial.

War is raging close to NATO's Eastern border. Russia has attacked Ukraine and threatens those states that in the past had been part of Moscow's sphere of influence. Many of them are now member states of NATO. As a collective defense alliance, this poses a threat to all NATO members. Since the ability to defend against an aggressor does not come for free, defense spending will be on the agenda at the NATO Summit in Vilnius in July 2023. NATO Secretary General Jens Stoltenberg has already expressed his expectation that all member states no longer see the 2% target as a mere ambition, but as the floor for their future defense spending. This paper presents first results for the expected defense spending of the 30 NATO members and the candidate country Sweden in 2023.