Institute for Business in the Global Context

Where the World of Business Meets the World

Month: February 2016 (page 1 of 2)

Fletcher Faculty Features: Prof. Michael Klein

As part of an ongoing series, we will be featuring the recent work of a number of our esteemed business faculty here at The Fletcher School. The series continues with Michael Klein, the William L. Clayton Professor of International Economic Affairs at The Fletcher School.
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Michael Klein worked with a group of 4 others to construct a new dataset on capital controls.  The paper the group wrote, “Capital Control Measures: A New Dataset,” will be published in the IMF Economic Review and presents an updated and extended dataset of capital control restrictions on both inflows and outflows of 10 categories of assets for 100 countries over the period 1995 to 2013. It discusses in detail the construction of the dataset and characterizes the data with respect to the prevalence and correlation of controls across asset categories and between controls on inflows and controls on outflows, the aggregation of the separate categories into broader indicators, and the comparison of this dataset with other indicators of capital controls.

The latest version of the dataset can be downloaded in both Stata and Excel formats

Prof. Klein also worked with Carlos Arteta (the World Bank) and Jay Shambaugh (Council of Economic Advisors) on research that was published in the World Bank’s Global Economic Prospects titled, “Exchange Rate Regimes and Capital Controls.” The essay explores the empirical linkages between a country’s choice of currency regimes and of capital flow measures.

In a policy memo for The Atlantic Council, who is now partnering with Fletcher, Prof. Klein and Pavel Vidal wrote about the need for financial development in Cuba as it reforms its economy.  They identify five  main challenges facing Cuba, and outline recommendations for both the Cuban and US governments. The memo is completed and will be published soon.

Additionally, a paper written with Jay Shambaugh on monetary policy, exchange rate policy, and capital controls was published in American Economic Journal: Macroeconomics in October 2015. The paper, “Rounding the Corners of the Policy Trilemma: Sources of Monetary Policy Autonomy,”  considers whether partial capital controls and limited exchange rate flexibility allow for full monetary policy autonomy.

10 Questions: What’s the Best Route to an innovative – Through City Hall or the Slum?

Delhi_India_Slum_January_2011Does urban innovation get its start from governmental institutions and mandates, or through social movements and mass advocacy? Whereas city hall may plan for the greatest number of possible futures, local community structures are often the backbone of a household’s decision-making. The road to innovation is paved in action, and neither city hall nor the communities it serves can afford to sit back and wait. Fletcher research has focused on this question through our Financial Inclusion research group within the Institute for Business in the Global Context.

Learn more:


As part of our “10 Questions” Series, we delve into hard questions of international business not easily answered by a single book, class, discipline, or school of thought. They herald a future where the world and the world of business are ever more interconnected, where decisions can’t be made in a bubble, where real expertise demands deep ‘contextual intelligence.’ This series reflects that contextual intelligence we cultivate in our students in the MIB program.

Fletcher Faculty Features: Prof. Joel Trachtman

As part of an ongoing series, we will be featuring the recent work of a number of our esteemed business faculty here at The Fletcher School. The series continues with Joel Trachtman, Professor of International Law at The Fletcher School.
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Joel Trachtman gave a speech on a panel of the ICTSD (International Center for Trade and Sustainable Development) in late January 2016. The speech asked the question,
“How does WTO law restrict national labeling regimes for environmental protection, specifically US dolphin safe tuna labeling standards.” You can watch the full panel discussion online as well as view Prof. Trachtman’s slides.

Professor Trachtman also wrote a pair of working papers in 2015-16, one for the RFF (Resources of the Future) and the other for the European University Institute:

  • “WTO Law Constraints on on Border Tax Adjustment and Tax Credit Mechanisms to Reduce the Competitive Effects of Carbon Taxes.” – If the US imposes carbon taxes, how will WTO law shape the way that the US applies these carbon taxes to imported and exported goods?  Read the paper online
  • “Export Restrictions and the Limits of Textual Interpretation. ” – How did the US use WTO law to persuade China to liberalize exports of rare earth minerals? Read the paper online

In addition, Prof. Trachtman penned a chapter for “The Obsolescence of Customary International Law,”  which features in Curtis Bradley’s (ed.), Custom’s Future (Cambridge University Press, 2016).  The chapter asks, does traditional customary international law work to address major international business, economic, and security problems?

Fletcher Faculty Features: Prof. Jeswald Salacuse

As part of an ongoing series, we will be featuring the recent work of a number of our esteemed business faculty here at The Fletcher School. The series continues with Jeswald W. Salacuse, the Henry J. Braker Professor of Law at The Fletcher School.
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Professor Salacuse at the 2015 GDN Conference

Jeswald W. Salacuse, Henry J. Braker Professor of Law, gave the keynote speech, “The Hidden Persuader – The Role of the Advisor in Negotiations and Group Decision Making,” at the 15th annual Group Decision and Negotiation Conference in Warsaw, Poland, June 23-26, 2015. A revised version of his talk, drawing on his research at the European Union Council of Ministers, is scheduled to appear as an article in the May issue of Group Decision and Negotiation. In his speech, Salacuse explored the roles and methods of advisors involved in negotiations, drawing on his prior research to identify three models of the relationship between the advisor and the negotiator.

Read the abstract of Prof. Salacuse’s speech

Also in June, Oxford University Press published the second edition of his book The Law of Investment Treaties. The first edition, issued in 2010, has been widely cited, including by the U.S. Supreme Court in the 2014 case of BG Group plc v. Argentina, in which both the majority opinion written by Justice Stephen Breyer and the dissent by Chief Justice John G. Roberts referred to the work in support of their respective positions.

Salacuse, an experienced international arbitrator, was recently appointed President of a tribunal hearing claims of German investors against Spain under the Energy Charter Treaty.

Fletcher Faculty Features: Prof. Laurent Jacque

As part of an ongoing series, we will be featuring the recent work of a number of our esteemed business faculty here at The Fletcher School. To kickoff the series, we begin with Laurent Jacque, Professor of International Finance & Banking, and the Academic Director of the Master of International Business program.
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In 2015, Laurent Jacque published the 2nd edition of his 2010 book, “Global Derivative Debacles: From Theory to Malpractice: 2nd Edition,” a look at the derivatives debacles in the last 50 years. Jacque tells the stories of “institutions which played in the derivative market and lost big. For some of these unfortunate organizations it was daring but flawed financial engineering which brought them havoc. For others it was unbridled speculation perpetrated by rogue traders whose unchecked fraud brought their house down.”

Read an interview with Prof. Jacque from the release of the original 2010 edition

What is new in the second edition? A new chapter on JP Morgan-Chase’s London Whale, an in-depth discussion of credit-default swaps, and an update of the revamped regulatory framework with Basel 2.5 and Basel III against the backdrop of the Euro crisis, along with a revised and expanded discussion of the AIG debacle.

Learn more about Prof. Jacque’s latest work

Lessons from Facebook’s Fumble in India

The factors that define the “context[ual intelligence]” are different across the developing world, but, more significantly, they are different from the environments in which digital innovations are developed – whether it is in Silicon Valley or in Boston or in tech enclaves in India and China. In these high-tech pockets, context is almost invisible: institutions function, data is the coin of the realm and a digital application’s “killer” value proposition rules the day. In this way, tech companies operate from a distance; they are not usually embedded within the local environments.

Read the full op-ed from Dean Chakravorti in Harvard Business Review

First-year MIB Ammar Karimjee Invited to Sit on UN Panel

Ammar Karimjee

First-Year MIB Candidate, Ammar Karimjee

First-year MIB student Ammar Karimjee was invited to sit on a UN panel on the issue of FGM/C in support of International Day of Zero Tolerance for FGM. He writes:

“As many of you may know already, Female Genital Mutilation (FGM — sometimes also called cutting or circumcision) is a very harmful practice performed on women around the world. It’s not something that simply occurs in rural villages and backwards societies. It happens in numerous countries and regions, including right here in the United States. It not only has zero medical benefits, but conversely causes major physical detriment to the women who are forced to go through it.

“Many of you may not know that I in fact come from a community which to this day practices FGM on women. Ever since finding out a few years ago, I have worked behind the scenes on this issue. But I am willing to be silent about this no longer. Today, to a room of 40-50 officials and activists alike, I spoke about how vital it is for males to become engaged in this issue and about the challenges that come from engaging with it. It’s not simply a women’s issue; this is a human rights issue. Men must start seeing it as such.

“Please spread the word so that people can understand how big a problem this is. I hope you’ll all join me in putting your foot down and saying it’s finally time to ‪#‎endFGM‬ everywhere and in all forms.”

You can learn more about Ammar and the issue at: https://www.youtube.com/watch?v=WmfflgHKCfU&feature=youtu.be

We are extremely proud of Ammar’s efforts to raise awareness on such a critical issue.

Middle-East Investors Unlikely to Play White Knight Again for European Bank
by John Letzing and Simon Clark

In addition, there is a political risk for sovereign-wealth funds seen propping up big banks with large investments, according to Patrick Schena, an adjunct professor at the Fletcher School of Law and Diplomacy at Tufts University.

“There is a very fine line between being an investor of last resort and being involved in a rescue or bailout,” Mr. Schena said.

Read the full article with quotes from Prof. Schena in the Wall Street Journal

10 Questions: The U.S., China, or Estonia: Who Leads the Digital Planet?

MIB Ads - Small thingBefore becoming consumers of digital marketplaces, the current three billion Internet users started with surfing and emailing. But the next billion will be different. They will start not as mere users, but rather as e-consumers – and this has profound implications for the future of global commerce and digital marketplaces.  Who are the next billion e-consumers?  So, who are the standouts of the future?

Which countries will race to the front, and which will be left behind? Hint: It’s not the usual suspects.

Learn more:


As part of our “10 Questions” Series, we delve into hard questions of international business not easily answered by a single book, class, discipline, or school of thought. They herald a future where the world and the world of business are ever more interconnected, where decisions can’t be made in a bubble, where real expertise demands deep ‘contextual intelligence.’ This series reflects that contextual intelligence we cultivate in our students in the MIB program.

Financial Inclusion and Immigration in Europe – Disrupting Identity Norms

by Brenda Santoro and Ahmed Dermish
with the support of Kim Wilson, CEME Senior Fellow

In uncertain times do developed economies have the resiliency in their financial inclusion processes to withstand rapid change without risking systemic stability and consumer protection?

Modern, nationally integrated systems, high-capacity supervision, and flexible policymaking are helping Germany turn the refugee crisis into an economic opportunity.

The German Federal Financial Supervisory Authority, commonly known as BAFIN, this fall relaxed requirements for opening a bank account. The new rules allow accounts to be opened with a stamped document from an appropriate German authority, such as BAFIN, along with a picture and personal information. Transitional rules are in effect until the approval of the law, expected this year. A directive in the European Union, which will begin in September 2016, will require similar access to bank accounts across the EU.

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