Summary:

This project examines how individuals respond to financial crises. It includes studies on the effect of foreign currency lending on individual political opinions in Eastern Europe, survey-research in Greece, and individual-level studies on public opinion during the 2008-10 Latvian financial and economic crisis. In a collaborative effort with colleagues from the University of York, Oxford University and IE University, we have run several surveys of public opinion on crisis management and the euro in Greece (July 2015, September 2015, December 2015, and February 2017).

Contributors:

• Stefanie Walter

Sources of Funding:

• Universität Zürich (position pursuing an academic career)

Collaborating Institutions:

• Elias Dinas, University of Oxford
• Nikitas Konstantinidis, LSE
• Ignacio Jurado, University of York

Contacts:

Internal:

Stefanie Walter

Transversal Research Priorities:

• Internationale Kooperation

Summary:

In the fall of 2008, banks around the world were at the brink of failure, and governments, in an attempt to save them, took over huge amounts of risks, jeopardizing their own solvency. Many scholars see bailouts, particularly the one in the United States, as the product of crony capitalism: Politicians grant bailouts as side-payments at the cost of the general public. In this thesis, I argue that this view misunderstands bailouts. It overlooks that voters, too, benefit from banking bailouts. In effect, the interests of voters and banks overlap because both prefer avoiding the crisis to deteriorate. Voters benefit from government interventions because they mitigate the impact on the economy and reduce the losses to investments. The latter is especially important for voters in countries with financialized pension systems because financial turmoil threatens voters’ retirement savings. Thus, this dissertation advances the debate on bailouts by arguing that the current contributions neglect politicians’ electoral incentive to bail out banks and exaggerate the importance of banks’ privileged access to policymaking and their lobbying power. This dissertation also contributes to the debates on business power and the power balance between the legislature and the executive. I argue that recent scholars of business power have mistakenly understood instrumental power to come from deliberate actions and structural power from automatic mechanisms. But structural power does not have to function automatically; business can invoke its structural power intentionally and strategically. And banks’ strategic use of structural power explains why British banks could thwart the government’s preferred crisis intervention, but American banks could not, and why the British government ended up with large losses, while the American government got its money back.

Sources of Funding:

• Universität Zürich (position pursuing an academic career)

Contacts:

External:

Dr. Raphael Reinke (UZH)

Summary:

This project tries to answer the question when and how interest groups are successful in influencing policy outputs. As an area of application the special interest policies for the iron and steel sector are anaylized in industrialized and industrializing countries. It is demonstrated that either full interest group competition or coordination is helpful in preventing special interest policies for the iron and steel sector, whereas mixed competitive and coordinated systems are rather prone to show these policies. The resulty rely on an fsQCA and two case studies.

Contributors:

• Stefanie Walter

Sources of Funding:

• Universität Zürich (position pursuing an academic career)

Summary:

Why are some policymakers able to adjust their policies in response to deteriorating economic conditions, while other policymakers delay adjustment as long as possible, a policy path that typically ends with an economic crisis? This project examines this question by focusing on the area of exchange-rate policy, where delayed devaluations frequently end with a currency crisis. The project extends my research on exchange-rate politics and analyses how exchange-rate level preferences interact with institutions to shape monetary and exchange-rate policy outcomes. I am particularly interested in explaining time-inconsistencies in exchange-rate policymaking. The project examines how distributional and electoral concerns can create strong incentives for policymakers to delay adjustment as long as possible. I argue that these incentives are particularly strong when voters are very vulnerable to both exchange and interest rate adjustments. Major currency crashes are particularly likely when voters are highly exposed to exchange rate changes but even more vulnerable to internal adjustment policies, and when electoral incentives prevent timely reform. This project was generously funded by the Fritz-Thyssen Foundation.

Contributors:

• Stefanie Walter

Sources of Funding:

• Foundation

Contacts:

Internal:

Stefanie Walter