Will now FIFA finally ban North Korea from International Soccer, moving away from double standards?
By Kaufmann | July 31, 2010 | No Comments »
It is well known that a month ago Sepp Blatter, the president of the world’s soccer governing body, FIFA, was irritated, vociferous and quick to officially react when French politicians engaged on a debate about the performance of their national football squad at the South Africa World Cup. Imperiously, and consistent with the monopolistic power he and FIFA do have, he warned France of possible suspension from international competition if politicians meddle in soccer matters.
Likewise, Nigeria was also warned by him and FIFA, after the country’s president, Goodluck Jonathan, indicated that their national soccer team would be banned from international soccer games for two years, following their poor showing in South Africa and corruption allegations. Blatter and FIFA quickly sprung to action to counter such possible suspension by the Nigerian authorities (and FIFA ignored the corruption allegations). Blatter went public and confidently told a press conference that FIFA had already taken “all necessary steps”.
The Nigerian authorities quickly retracted their ban threat, since Blatter and FIFA had threatened a retaliatory ban threat of their own, which would have also left out from international competition their under-20 women squad as well as their football clubs competing in Africa…
Topics: Corruption, Public-Private Linkages, Regulation & Security, Rule of Law, Voice and Human Rights, capture | Read and Submit Comments
Wall Street Financial Reform: Less than meets the eye on Financial Institutions, More than meets the eye on Oil Companies
By Kaufmann | July 16, 2010 | 2 Comments »
The 2,500 page long Dodd-Frank Financial Regulatory Reform Bill has passed through the United States Senate. The bill will now be signed into law by President Barack Obama. It signals a halt to the deregulatory process that the U.S. financial system has experienced for almost fifteen years.
The bill promises to strengthen consumer protection. In principle, it raises bank capital requirements, requires more collateral and margin requirements, enables a regulator to act against a very large and risky bank, and more.
These are overdue reforms. Warts and all, and considering the political realities of legislative deals, having this bill is better than continuation of the regulatory vacuum. But it is not a comprehensive systemic solution. This watered down bill will not effectively reverse the massive financial deregulation that took place, nor will it fully assure that the financial system will be effectively supervised and regulated so to avoid another systemic crisis…
Topics: Corruption, G-20, Public Financial Management, Public-Private Linkages, Regulation & Security, Transparency, capture, financial crisis | 2 Comments
Blowing the Vuvuzela on FIFA: Governance Reforms for Development
By Kaufmann | July 9, 2010 | 1 Comment »
Sixty-two games have been played at the 2010 World Cup, which has been marvelously hosted by South Africa. Only two games remain; one tomorrow for third place, and then Sunday’s much awaited World Cup Final between Spain and the Netherlands. In a couple of days, we will have a brand new world soccer champion. But its international governing body, the Fédération Internationale de Football Association (FIFA), will still be stuck in the past. FIFA has monopoly control over international soccer, and as this tournament has shown, faces enormous challenges: subpar corporate governance, leadership and transparency. These challenges partly undermine the development objectives of member countries…
Topics: Aid Effectiveness, Corruption, G-20, Measurement Frontiers, Public Financial Management, Public-Private Linkages, Regulation & Security, Rule of Law, Transparency, capture | 1 Comment
Apology Letter to Maradona, or to the Soccer World?: Don’t cry for me Argentina
By Kaufmann | July 4, 2010 | 10 Comments »
The Letter, entitled ‘An Apology to Maradona, a Rolicking Genius’, was published just before yesterday’s World Cup game between Argentina and Germany. Excerpted, it reads:
“Dear Diego: It is high time that we critics say sorry, and thank you. We misjudged your appointment as coach. We believed that the 78-year-old president of Argentina’s soccer federation, had lost reason in asking you, a fading icon without a coaching badge, to lead it through this World Cup. Well, so much for [our] so-called expertise. You liberate the team, play to its strengths, attack, attack, attack… And you also liberate us. When your team rips apart the caution of opponents, we feel like children who all want to be attackers. [Your] enthusiasm reminds us that soccer is a simple game. Your team has superior attacking skills, so let it play to its nature… Genius, playing to your own rules.
You know, but probably do not care, that only two men have won the World Cup as a player and a coach. Mário Zagallo for Brazil… Franz Beckenbauer captained Germany to the title in 1974, and was its manager in 1990… [Like you], Beckenbauer had no background on the sideline.
[I]t’s time to say mea culpa, and mean it.” …
Topics: Measurement Frontiers, Rule of Law, Transparency | 10 Comments
Will June 27 become ‘Instant Replay in Soccer’ Day?
By Kaufmann | June 27, 2010 | 1 Comment »
This day, June 27th, is important for both Britain and Argentina. Over 200 years ago, on this day in 1806, the British captured Buenos Aires. Today, June 27th, 2010, fortunes were reversed. Two crucial soccer games took place in the knockout stage of the World Cup. In the first, Germany sent England home 4-1, while in the second game Argentina beat Mexico 3-1. But in themselves those important football results are not enough for June 27th to be imprinted in history. After all these results were not about World Cup finals; there are still a dozen of teams in contention in fact…
Topics: Measurement Frontiers, Regulation & Security, Transparency, capture | 1 Comment
Scrap FIFA World Soccer Ranking: Geography and Governance predict World Cup results
By Kaufmann | June 25, 2010 | 1 Comment »
In its own World Soccer Federation portal, FIFA.com, boasts: ’since 1993, the FIFA/Coca-Cola World Ranking has become a regular part of international sports and an important indicator to find where teams stand in world’s football’s pecking order…’
Well, not quite, as it turns out, if judging by the results from an analysis of the Group competition stage that has just concluded in the football World Cup currently taking place in beautiful South Africa.
A total of 32 teams qualified for the World Cup. They were divided into 8 groups of 4 countries each, competed against each other, playing 3 games each, for a maximum of 9 points. The top 2 teams in each group are now advancing to the next stage of 16. Eight games will take place over the next 4 days, starting on Saturday with Uruguay playing South Korea, and then later in the day Ghana plays against the US. And on Sunday Germany plays England in the earlier match, and so on until this coming Tuesday. The winner in each one of these 8 games advances to the Cup’s quarter finals, and so on…
Topics: Corruption, Measurement Frontiers, Rule of Law | 1 Comment
Back to the Future in the soccer World Cup: Chile wins 1-0 or 3-1?
By Kaufmann | June 16, 2010 | 4 Comments »
This day, June 16th, is the day when Chile won a very important soccer game. So important, that Chile earned 3rd place in the World Cup! How can that be, some may ask, when the current World Cup in South Africa is only in its very first stage?
I am thinking about the very same day in the World Cup exactly 48 years ago: on June 16th, 1962, Chile beat Yugoslavia and earned 3rd place in that World Cup hosted by Chile. I still have vivid memories as a kid from that historical encounter, including the Eladio Rojas goal in the very last play of the game. I was in attendance with my father and brother. Chile’s performance in that World Cup surprised pundits, since it did not have well known players. Their special team spirit (and being hosts) did help…
Topics: Measurement Frontiers, Regulation & Security | 4 Comments
Greece and Volcanoes, BP Oil and Hurricanes
By Kaufmann | May 29, 2010 | No Comments »
The earth’s wrath is ubiquitous these days, as vividly witnessed by the fiery eruptions of the Eyjafjallajokull, Turrialba and Arenal, Pacahua, and Tungurahua, the active volcanoes in Iceland, Costa Rica, Guatemala and Ecuador, respectively.
In ancient Greece, a volcano eruption was a sign of divine disapproval. It is unclear whether modern Greece has taken notice.
For better of worse, unlike Greece, there was no ancient BP. Oily conglomerates have only become more important than nations in recent times. It is thus hard to tell whether an extraordinarily active hurricane summer season (expected to be upon us imminently) can be interpreted as sign of disapproval from above.
Topics: Corruption, capture, financial crisis | Read and Submit Comments
Millennium Development Goals (MDGs) will not be met unless governance improves
By Kaufmann | May 14, 2010 | 6 Comments »
In 2000, the international community agreed on eight Millennium Development Goals (MDGs). Among others, countries pledged to halve extreme poverty, achieve universal education, halt the spread of HIV/AIDS and reduce child and maternal mortality rates by 2015. Ahead of the UN’s upcoming September 2010 Summit on the MDGs, countries and aid donors have begun reflecting on the progress made, and on pending challenges.
There is growing consensus that unless the pace of progress quickens, the world will be unable to achieve the majority of the Millennium Development Goals in five years. But the devil is in the details: does the pace of progress need to quicken everywhere, and similarly across all MDGs? And what does progress depend on?…
Topics: Aid Effectiveness, Corruption, G-20, Measurement Frontiers, Public Financial Management, Public-Private Linkages, Rule of Law, Transparency, Voice and Human Rights, financial crisis | 6 Comments
Does Grease Money Speed Up the Wheels of Commerce?
By Kaufmann | May 2, 2010 | 2 Comments »
Does bribery reduce bureaucratic red tape to an enterprise? That is a question that Shang-Jin Wei and I investigated in a research paper over a decade ago. The Economist writes about it in their current issue in an article called (following Moises Naim’s coining) ‘The Corruption Eruption’ , here, also citing the work of Wharton’s Philip Nichols, who points out that many Western firms do fine in emerging markets without paying bribes.
In our research article, entitled ‘Does Grease Money Speed Up the Wheels of Commerce’, based on surveys of thousands of multinational and domestic firms around the world, we found that the answer is No — if bureaucrats have control in determining the extent of regulatory burden and red tape delay so to extract bribes.
We found that on average firms that bribe waste more, not less, management time dealing with bureaucrats that firms that say No to bribery, and that firms that bribe also face a higher, not lower, cost of capital. Thus we rejected the dominance of the ‘efficient grease hypothesis’, suggesting that, on average, bribery was ’sand in the wheels of commerce’ instead …
Topics: Corruption, Measurement Frontiers, Public-Private Linkages, Regulation & Security, Rule of Law, Transparency | 2 Comments
Corruption and Fiscal Deficits in Rich Countries
By Kaufmann | April 20, 2010 | 4 Comments »
Some of my research tends to challenge orthodoxy, such as taking issue with the claim that the developing ‘world’ is the corrupt one (contrasting wealthy nations); that corruption is largely about blatant bribery, and that corruption and macro-economic stability should be viewed separately from each other by different types of ‘experts’.
Right now I am committing the heresy of focusing on the link between corruption and budget deficits in industrialized countries. After all, even if politically incorrect to admit it, there are a number of rich countries where corruption is widespread, in a variety of forms, illegal and ‘legal’, political and financial.
I explore the mechanisms by which corruption can affect the public finances of a nation, and then the extent to which corruption matters in explaining a rich country’s fiscal deficit. As it turns out, it matters aplenty.
The Wall Street Journal picked up on this work, and used it in their cover page article on Greece. A brief version of my research article is here at Brookings, and also reproduce in full in this entry here below as well…
Topics: Corruption, G-20, Measurement Frontiers, Public Financial Management, Public-Private Linkages, Transparency, capture, financial crisis | 4 Comments
Wall Street Reform and Beyond
By Kaufmann | April 16, 2010 | No Comments »
For years I have been arguing that regulatory and state capture is a major challenge in many countries, including in the US. I wrote papers, presented analysis and evidence, even argued the case to top executives at the World Economic Forum long ago.
All with limited success, other than getting some articles published in journals and a sprinkle of accolades from a few development specialists. The skepticism tended to be exponentially higher in rich industrialized countries than in developing and post-transition countries.
That started to change a bit at the outset of the financial crisis, yet the few of us who were writing about corruption and capture in Wall Street, and the perverse role played by money in politics, were vastly outnumbered by those providing technocratic explanations of the crisis — whether misunderstanding of risk, low interest rates, leverage ratios, or macro-economic imbalances. Few were asking probing questions as to the extent to which such technocratic factors were driven by politics, including various forms of capture. In the interim, more has been written about this, yet skepticism remains regarding non-technocratic explanations…
Topics: Corruption, G-20, Measurement Frontiers, Public Financial Management, Public-Private Linkages, Regulation & Security, Rule of Law, capture, financial crisis | Read and Submit Comments
Breaking the Cycle of Crime and Corruption (while questioning existence of the cycle)
By Kaufmann | April 14, 2010 | 1 Comment »
The World Policy Journal asked for the views of a few of us on “How Can Nations Break the Cycle of Crime and Corruption?” I answered, in a just-published short piece, though I disagreed with the main premise behind such question: Crime and Corruption need not be inextricably linked, or party to a vicious cycle.
In fact, crime and corruption do not always co-exist, share the same determinants, or respond to the same strategies and measures. A corrupt and authoritarian police state can control common crime, as in North Korea. Conversely, common crime can be a challenge to countries with satisfactory anti-corruption track records, like Chile.
Crime rates tend to be higher where there is high unemployment, high socio-economic inequality, and lax gun laws.
Corruption thrives where civil liberties, free press, transparency, and contestable politics are absent…
Topics: Corruption, Measurement Frontiers, Public-Private Linkages, Regulation & Security, Rule of Law, Transparency, capture, financial crisis | 1 Comment
California Learning Lessons from Chile’s Earthquake
By Kaufmann | April 3, 2010 | No Comments »
Dozens of researchers have flocked to Chile to study the design and construction lessons from Chile’s 8.8 mega-earthquake in February, for potential application in California (similarly earthquake-prone and regulation-codes). Buildings of similar vintage located next to each other fared totally differently. It is like a ‘living laboratory’ setting — a haven for researchers…
Read the rest of this entry »
Topics: Measurement Frontiers, Regulation & Security | Read and Submit Comments
Transparent Aid for Haiti’s Reconstruction: Capture Matters
By Kaufmann | March 30, 2010 | 2 Comments »
On Wednesday, March 31, international donors are convening at the United Nations to discuss Haiti’s long-term reconstruction plans and to make assistance pledges. The publicly disseminated Action Plan for Reconstruction and National Development of Haiti, produced by the government of Haiti with inputs from the U.N., European Commission, the World Bank, Inter-American Development Bank and civil society, has assessed Haiti’s reconstruction needs over the next three years at $11.5 billion.
The full Post-Disaster Needs Assessment (PDNA), produced by a collaborative effort involving 300 Haitian and international experts weeks ago, and on which the Haitian government’s Action Plan is based, has yet to be fully disclosed to the public, although it is expected to be presented at the donor conference…
Topics: Aid Effectiveness, Corruption, Public Financial Management, Public-Private Linkages, Regulation & Security, Rule of Law, Transparency, Voice and Human Rights, capture | 2 Comments
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