Financial Crisis and Sovereign Debt: The European Union between Risks and Opportunities
A key element for understanding the possible developments of the sovereign debt crisis relates to several rounds of non-standard interventions, ranging from the first Security Market Programme to the enhanced Long Term Refinancing Operations, launched by the European Central Bank from May 2010 to March 2012 as a reaction to the exceptional circumstances prevailing in financial markets. In the meantime, the other European institutions prepared and approved a number of legislative changes, intended to enhance the common economic governance and budgetary surveillance. This paper looks at the implications of the “non-standard measures” for the institutional role of the Central Bank in the context of the European Treaty, and examines the new legal acts as instruments to correct and prevent imbalances. The lessons from the Greek case point to more general elements of weakness in the Union, which can only be addressed by an integrated set of significant changes in the EU architecture. Specific attention should be paid to the role played by the rating agencies, and to the opportunity to foresee appropriate supervision by public authorities over them: taking into account that the current regulation seems far from satisfactory, and reforms in line with those enacted in the US would greatly help. The need for solid and sustainable fiscal policies remains key, together with appropriate budgetary and macroeconomic surveillance. The main characteristics to be designed for structured interventions are then described and discussed, with specific regard to the necessary surveillance of the degree of achievement of agreed policies and outcomes, aimed at addressing issues of moral hazard. The Six Pack and the Fiscal Compact Treaty may be seen as important steps in the right direction, but not as definitive solutions. In this context, non-standard interventions – including the ECB measures as well as use of EFSF/ESM fund – cannot go beyond a short-term solution, only temporarily addressing the malfunctioning of securities markets. Their ability to restore an appropriate monetary policy transmission mechanism is linked to successful implementation of other reforms herewith analysed. At a more general level, a change is required toward the observance of rules inspired by social responsibility, properly linked to merit and rigour. All this might result to the approval of new instruments of enhanced integration, not feasible in previous years; or lead, in the opposite case, to critical consequences for the continuity of the Union in its current form.
SUSTAINABLE GOVERNANCE AND REGULATION OF BANKS AND PUBLIC COMPANIES: A STUDY OF THE CONCEPT “ACTING IN CONCERT”
How to cite this paper: Sacco Ginevri, A. (2017). Sustainable governance and regulation of banks and public companies: A study of the concept “acting in concert”. Corporate Governance and Sustainability Review,
Strategy and Manipulation in Medieval Elections
There are many goals in developing electoral protocols, including a desire for a system which is transparent, in that it is clear what the rule or procedure to follow is; nonmanipulable, in that it is not in a person’s best interest to misrepresent their preferences; honest, in the sense that it elects the ‘right’ candidate; and not open to strategizing, i.e., bribery or collusion. However, these desiderata are in tension with each other: Often, transparent electoral procedures are the least strategy resistant, and many honest procedures encourage manipulation. Thus a balance between these different goals must be sought. In modern times, since the seminal result on vote manipulation, the Gibbard-Satterthwaite Theorem [5, 6], much attention has been devoted to developing voting rules where manipulation is never in the best interest of the voters [4] or which are computationally too complex for the average bounded agent to be able to manipulate [1]. This focus on computational aspects of electoral methods is one of the hallmarks of modern studies on voting. But pursuit of these goals is not restricted to modern times: Those participating in elections in the Middle Ages also sought transparency, non-manipulability, honesty, and strategyproofness in so far as these properties can be consistently expressed in a single procedure. However, given the lack of computational sophistication in the Middle Ages, alternate approaches were needed in order to promote honesty, discourage strategizing, etc. These approaches can be classified as either external (constraints introduced outside of the electoral procedure, such as incentives for coming to consensus quickly) or internal (constraints introduced within the electoral procedure, such as voting rules which cannot be manipulated without adverse effects, or which are too difficult for the average bounded agent to manipulate). Surveying examples of both approaches in the context of medieval ecclesiastical and secular elections provides an interesting comparison to modern electoral procedures. Elections in the Middle Ages were used for the same reasons that they are today: To select suitable candidate(s) for a particular office, duty, or obligation. However, it is important to note that the term electio was used in the Middle Ages in a broader sense than our modern ‘election’. Its primary sense was ‘selection’ or ‘choice’, and only secondarily ‘election’ in the modern sense. Thus, many records which purportedly discuss elections are not discussing elections of the type which interests us. We can identify four categories of medieval electoral processes: (1) Election by an external authority having no direct interest in the election; (2) Indirect election, where electors name other electors who then select or elect the officials; (3) Election by lot; and (4) Election by ballot. Elections of the first and third types are generally computationally uninteresting; the first type corresponds to dictatorial voting rules, and the third type collapses to probability theory. In general, interesting voting methods are found only in the fourth type, election by ballot, though they can also occur in indirect election.