Leslie Elliott Armijo

Statement on Research – November 2019

Leslie Elliott Armijo

            My research investigates the international relations (IR) of the global South and the comparative politics (CP) of national development in large middle-income countries, also known as emerging powers, especially those that are democracies, however flawed. I study the influence of ideas, values, structures, and interests on outcomes in the realms of power and money—and of course also the reverse. Main themes in three research tracks are outlined below, and each is followed by a selection of briefly annotated works listed in reverse chronological order. Current and prospective projects focus on the politics and political economy of patient capital in emerging economies, cybercurrencies, regional financial cooperation, and methods for international public policy analysis. An overarching theme throughout my writing is the interaction of political democracy and institutions supportive of economic growth. My CV contains the complete list of publications.

            I have spent over a year doing field research in India on these topics and cumulatively two years in Brazil and Argentina, with briefer research/teaching/small workshop trips to Hungary, China, South Africa, Indonesia, and Germany. This experience in and with the global South is magnified by the number of projects I have initiated with scholars from around the world (please see letters and CV).

Research Cluster #1: International Relations of the Global South      

            Contemporary international relations are evolving from the post-Cold War unipolar moment to an eventual multipolar (or bipolar/multipolar) future. Greater equality in global politics is morally attractive, but also implies increased volatility and uncertainty during the transition from one systemic structure to another. If liberals and progressives in the global North avert their gaze from international power issues, then a future with China and the United States as rival great powers could resemble the darker aspects of the Cold War. Preservation and expansion of the mostly rule-governed post-Second-World-War liberal internationalism by clear-eyed, intentional power-sharing of the incumbent G7 Western major powers with rising states, and within existing global governance institutions, is the option most conducive to world peace and prosperity, most especially for poor people in developing countries. Major power trade war, for example, would plant virtual, perhaps even actual, landmines on the road to achieving the United Nations’ Sustainable Development Goals.

            My work analyzes the ways in which rising powers, such as the BRICS (Brazil, Russia, India, China, and South Africa) grouping, increasingly have asserted themselves as significant players in international relations and global economic governance. Several publications theorize and track emerging powers’ exercise of “financial statecraft,” defined as the intentional use by senior national leaders of levers of influence based on financial capabilities (including creditor power, currency power, or votes and leadership roles in multilateral financial institutions) that the state can manipulate for larger foreign policy ends. At present, the incumbent Northern (Western) powers who largely run existing global economic governance institutions have an option to expand participation. The alternative is that rising states, often with authoritarian domestic political regimes, create counter-institutions within which they exercise preponderant influence. For example, China clearly views its annual Belt and Road Initiative meetings as opportunities for political as well as economic leadership. My newest project in this track turns to the conditions for regional cooperation within the global South, investigated across five critical policy sectors in South America.

Representative related publications

• 2020 (work in progress). “Orchestrating Governance in the Global South: Can South America Provide Public Goods?” Anchor paper for planned special issue on “Regional Policy Governance in the Global South: The South American Case.”

Articulates/evaluates regional integration theory previously elaborated mostly with reference to the EU, but here applied to South America/Latin America. I co-lead a small, interdisciplinary group of scholars from throughout the region in a joint research endeavor theorizing the conditions for effective regional and cross-border governance in South America in five distinct international policy sectors: infectious diseases, climate change, financial regulation, migration/refugees, and transportation infrastructure.

• 2019. “The Monetary and Financial Powers of States: Theory, Dataset, and Observations on the Trajectory of American Dominance” (with D.C. Tirone and H-k. Chey). New Political Economy. DOI: 10.1080/13563467.2019.1574293, online availability from February.

Theorizes financial characteristics of countries that national leaders might attempt to deploy for foreign policy gains: creditor power, network power, currency power, and financial governance capabilities. Introduces a dataset offering indicators of each dimension, and comments on inter-country shifts since 1995.

• 2018. The BRICS and Collective Financial Statecraft. (with C.A. Roberts and S.N. Katada). New York: Oxford University Press.

Investigates, and theorizes, the 21^st century origins and behavior of the BRIC (later BRICS) group, and their joint efforts, notwithstanding diverse preferences, to employ financial statecraft to secure greater freedom of action for themselves in global financial markets and institutions. Coauthored by three area specialists, two from IPE and the third a security studies expert, the book draws on interviews and original archival research in the five member countries. A Chinese edition is in process.

• 2014. “Absolute or Relative Gains? How Status Quo and Emerging Powers Conceptualize Global Finance” (with J. Echeverri-Gent). In T. Oatley and Wm. Winecoft, eds. Handbook of International Monetary Relations. Cheltenham: Edward Elgar, pp. 144-165.

Policymakers in emerging market and developing countries (EMDCs), write the authors, are unlikely to be convinced by neoclassical economic arguments advanced by IFI and other experts that abstract from global power politics, as these countries’ structural vulnerabilities in the interstate system oblige them to attend to relative as well as absolute gains from international economic integration.

• 2014. The Financial Statecraft of Emerging Powers: Shield and Sword in Asia and Latin America (ed. with Saori N. Katada). New York: Palgrave Macmillan.

Theorizes financial statecraft (FS) as a special and understudied variety of economic statecraft, and one that may be conceptualized as having both offensive and defensive, and coercive and attractive, dynamics. Investigates FS strategies employed by middle-income countries in Latin America (Argentina, Brazil, Venezuela) and Asia (China, India, Indonesia, Japan, and Malaysia).

• 2013. “Equality and Regional Finance in the Americas,” Latin American Politics and Society, 55:4, Winter, pp. 95-118.

Characterizes alternative paths for hemispheric financial “development” in the Americas: those preferred by the United States, Venezuela, and Brazil, focusing on ideas and ideology in the supposedly technical world of finance. Each vision builds on material and geopolitical interests of a would-be leader state—but also on distinct initial philosophical (and inherently non-falsifiable) assumptions about the fundamental nature of “equality” in a contemporary democracy.

• 2011. “Regional Integration: Political Uses of Energy Policy” (with C.A. Gustafson). In M. Font and L. Randall, eds., The Brazilian State: Debate and Agenda. Lanham and New York: Lexington Books.

Contrasts the incompatible visions of South America’s energy future promoted in the early 21^st century by the United States, Venezuela, and Brazil, recognizing that each vision was the product of both national resource endowments and political ideologies.

• 2010. “Brazil, the Democratic and Entrepreneurial BRIC” (with S. Burges). Special issue on the BRICs, ed. C. Roberts. Polity, 42:1, January, pp. 14-37.

Why would Brazil choose to cooperate with partners as politically and geographically diverse as Russia, India, China, and South Africa? Key factors for the government of then President Lula da Silva were a commitment to South-South diplomacy globally, and the hope of demonstrating leadership to Brazil’s South American neighbors.

• 2007. “The BRIC Countries” (ed.). Special issue of Asian Perspective, 31:4, December.

This special issue was among the very first academic publications on the BRIC countries, which in 2006, at the initiative of Russia, decided to take a catchy phrase developed by Goldman Sachs to lure investors and constitute themselves as a formal, if loose, political grouping.

• 2002. Debating the Global Financial Architecture (ed.). Albany, NY: State University of New York Press.

Following the Asian financial crisis of 1997-1999, a flurry of global summits and working groups meetings declared the need for reforms of the “architecture” of international finance. The contributors, both political scientists and economists, enter the debates, according particular attention to the points raised by advocates within and for the global South. Japan’s attempt to establish an Asian regional monetary fund, resisted by the United States, showed that, even within the global North, greater inclusion was hardly automatic.

• 2001. “The Political Geography of World Financial Reform: Who Wants What and Why?” Global Governance, 7:4, Special issue on the Global Financial Architecture, edited by Susanne Soderberg.

Published shortly after the Asian financial crisis, the paper explores the preferences, recommendations, and socioeconomic interests backing the alternative advocacy positions labeled “laissez-faire liberalizers,” “transparency advocates,” “financial stabilizers,” and “anti-globalizers.”

• 1999. Financial Globalization and Democracy in Emerging Markets (ed.). New York: Palgrave.

Analyzes the consequences for national politics, especially the creation/ survival of democracy, of the emerging economy debt crises of the 1980s through the mid-1990s. Includes chapters on the history of debt crises, the herd behavior of foreign investors, and country studies of Latin America (Mexico, Brazil), Russia, and Asia (India, Indonesia, Thailand, and Vietnam).

Research Cluster #2: Comparative Political Economy of Larger Emerging Economies, Especially New or Fragile Democracies

            At the national level, I study the politics of inflation stabilization, privatization, financial institutions, markets, and regulations, and recently have added the politics of big, physical infrastructure projects. I investigate topics usually thought appropriate for economics or business faculties, but with the critical eye of a social scientist. I am particularly interested in the practical ethics of economic development in new or fragile democracies. In each case the research goal is understanding these sectors’ subtle internal power relations and implicit but pervasive ideological biases in the interests of unpacking the causes, and consequences, of significant national economic policy choices. My default perspective is as follows. It is legitimate to critique selfish, soulless capitalism, especially in this age of increasing inequality. Yet as a practical matter, capitalist markets are enormously productive and efficient, given a particular set of incentives to participants. To conclude that capitalism, private business, the profit motive, advertising, and so forth are intrinsically evil is not merely defeatist, but also mistaken. Instead, effective and enduring solutions to economic injustice likely come in the form of engagement via government provision of regulation and other public or collective goods. In a similarly pragmatic vein, liberal democracy and the rule of law are important because they provide citizens with voice to defend themselves, against powerful economic interests, the state, and majoritarian ethno-nationalist identity politics, a contemporary scourge in both the advanced capitalist democracies and many if not most emerging powers and middle-income countries.

Representative related publications

• 2020 (work in progress). The Politics of Patient Capital: Lessons from Brazil, India, Pakistan, and Argentina, book manuscript.

The contemporary worldwide enthusiasm for supporting innovative entrepreneurship, upgrading infrastructure, and pursuing strategic comparative advantage depends on countries finding “patient capital.” Patient capital implies long-term commitment, aligning investor goals with those of the firm or project supported, but also unambiguous incentives for investors to discriminate between sound projects and pipe dreams. Long-term finance potentially may be sourced domestically or from abroad, and delivered through either the public or private sectors. Characteristic benefits and challenges accompany each path. The book draws lessons from the experiences of Brazil (illustrating “national public finance” via its development bank, BNDES), India (recent forays into “national private finance” through partial bank privatization and capital markets promotion), Pakistan (recipient of “foreign public finance” from both the West and China’s Belt and Road Initiative), and Argentina (whose reliance on “foreign private finance” in the 1990s continues to haunt policymakers).

• 2017. “The Public Bank Trilemma: The BNDES and Brazil’s New Developmentalism.” In P. Kingstone and T. Power, eds., Democratic Brazil Divided. Pittsburgh: University of Pittsburgh Press, pp. 230-247.

National policymakers confront characteristic governance challenges when they channel long-term finance through public sector banks. Brazil’s industrial development bank, the BNDES, illustrates an uneasy trilemma of goals development bankers and national economic planners necessarily confront. Development bank leadership must allocate scarce resources while balancing three sometimes incompatible imperatives: the demands of expertise, democracy, and markets.

• 2017. “Explaining Infrastructure Underperformance in Brazil: Cash, Political Institutions, Corruption, and Policy Gestalts” (with S. Rhodes). Policy Studies, 38:3, pp. 231-247.

In global comparisons of upper middle-income countries, the quality of Brazil’s transportation, energy, communications, and urban infrastructure looks surprisingly poor. Reviewing major national development programs since the 1990s, the paper assesses the principal alternative explanations: inadequate financing, uniquely dysfunctional formal political institutions and rules, public corruption, and national economic planning driven by ideological assumptions in lieu of careful analysis. After concluding that all four explanations play a role, the paper recommends addressing problems that are easier to fix.

• 2015. Unexpected Outcomes: How Emerging Economies Survived the Global Financial Crisis (ed. with Carol Wise and Saori N. Katada). Washington, D.C.: Brookings Institution.

Throughout the 20^th and into the 21^st century, development experts assumed that a sneeze in the core advanced industrial countries would provoke pneumonia in peripheral developing countries. Surprisingly, the global financial crisis of 2008-2009 lasted longer, and caused greater economic damage, in the core than the semi-periphery. The volume examines the local and common factors that mattered, comparing cases from Asia (China, South Korea, India, and ASEAN) and Latin America (Brazil, Argentina, and Mexico). A Spanish edition is forthcoming.

• 2010. “Two Dimensions of Democracy and the Economy.” (with C. Gervasoni). Democratization, 17:1, February, pp. 143-174.

The study investigates the implications of Dahl’s two dimensions of democracy (“polyarchy”): contestation/competition and inclusion/participation. It hypothesizes that increases in democratic competition inspire policy incrementalism, thus lowering growth volatility and generating fewer deep crises. Meanwhile, increases in substantive democratic inclusion – genuine political voice, or democratic participation in the presence of a minimum of contestation – should increase the political weight of relatively poor voters, who have a differentially strong aversion to deep growth crises. Empirical results are supportive.

• 2006. “Compared to What? Assessing Brazilian Political Institutions” (with P. Faucher and M. Dembinska). Comparative Political Studies, 39:6, August, pp. 759-786.

In the late 1980s and into the early 21^st century, institutionalist political scientists profoundly criticized Brazil’s formal political institutions (such as open-list, state-wide proportional legislative elections, which typically sent federal deputies from at least two dozen political parties to Congress) as almost uniquely dysfunctional. The authors, experts in democratic transitions in different world regions, argue that, notwithstanding the difficulties of legislative coalition-building, Brazilian democracy has functioned reasonably well in terms of actual public policy achievements.

• 2005. “Mass Democracy: The Real Reason that Brazil Ended Inflation?” World Development, 33:12, December, pp. 2013-2028.

After six different failed stabilization plans beginning in the early 1980s, each followed by a new, higher spike in prices, Brazil finally ended hyperinflation in 1994-1995. The successful “Real Plan” has been analyzed for its unique economic features. This article, in contrast, argues that the really significant difference was the politics.

• 2002. “‘We Have a Consensus’: Explaining Political Support for Market Reforms in Latin America” (with P. Faucher). Latin American Politics and Society, 44:2, pp. 1-40.

Many political economist have argued that market-oriented and transitionally disruptive reforms could never be implemented under full democratic auspices, and that therefore top-down ‘shock treatment’ reforms were the best option in new and fragile democracies. The experiences of Argentina, Brazil, Chile, and Mexico provide counterexamples.

• 1997. “India: Democratic Integrity and Financial Molasses.” In R. Bingham and E.W. Hill, eds., Government and Business Finance: Global Perspectives on Economic Development, Newark: CUPR Press of Rutgers University.

Offers a counter-intuitive and qualified defense of India’s admittedly inefficient financial sector from independence through the mid-1990s as useful in allowing democratic survival in an unlikely case.

• 1997. “Center-State Relations in India and Brazil: Privatization of Electricity and Banking” (with Prem Shankar Jha). Revista de Economia Política  (São Paulo), July/November.

Compares the limited privatization plans in similar sectors in two large, federal democracies in the late 1980s and early 1990s, emphasizing the importance to policy success in both countries of good political relations between the central government and the separately elected state governments.

• 1996. “Inflation and Insouciance: The Peculiar Brazilian Game,” Latin American Research Review, 31:3, Fall, 7-46.

Builds a second generation game theoretic model of the political economy of Brazilian very high to hyperinflation. Instead of identifying the main players (business, workers, and government) as inadvertently generating inflation as they fight over shares of a non-expanding pie, it adds a fourth player, banks, who in Brazil’s unusual institutional context are positively committed to inflation as a way of earning profits by exploiting inefficiencies in the system. That is, existing models of Latin American inflation assumed that no one actually wanted inflation. Should this change, then the problem becomes much more difficult to solve.

• 1995. Conversations about Democratization and Economic Reform: Working Papers of the Southern California Seminar (ed.). Los Angeles: USC, Center for International Studies.

Brings together lightly-edited versions of working papers presented at the Southern California monthly seminar on joint transitions, which ran throughout 1992-1993, with participation of scholars from several disciplines (politics, economics, business), representing multiple geographic specializations throughout the developing and post-Communist world (East Asia, Latin America, Mid-East, and Eastern Europe).

Research Cluster #3: Qualitative Methods for BA & MA Programs in International and Comparative Public Policy

            As I complete the publications in process in the two research clusters above, I am in the very early stages of a third type of project: articulating a research methodology to be used in graduate public policy programs to teach students to construct an analytical policy history of a national or international public policy arena. It appears to me that most existing public policy programs do a good job with quantitative skills, and sometimes with sector specific knowledge (offering for example, a concentration in environmental, public health, or urban transportation policy), and may also provide a sufficient overview of the formal institutional and legislative environment in one or more advanced industrial country, such as the United States or Canada. But “best practices” for an advanced industrial democracy may be wildly inappropriate for many emerging markets and developing countries. Moreover, even courses that marry practical policy subjects with an investigation of the complexities and irrationalities of international organization and global governance overwhelmingly tend to focus on European Union cases. Given that students seeking professional degrees in public and international policy come from a variety of countries, including those in the global South, as well as diverse professional and academic backgrounds, ranging from non-governmental organization alumni, to liberal arts graduates, to those with business, medical, law, or engineering training, there seems to be a need for more systematic approaches to training smart, idealistic young people to do sensitive public policy or advocacy work across globally diverse cultural and political contexts.

Related publications

• 2021? (Work just begun). International Public Policy in a Multipolar World: Extending Policy Studies to the Global South (with S. Rhodes).

This book considers the challenge of reformulating or augmenting the teaching of graduate public policy in the global North, especially in the United States, to incorporate a wider range of issue arenas, countries, and cases. The task is not merely a matter of adding a case on, for example, electricity distribution or health care in the Indian state of Gujarat to a series of studies of a similar policy arenas in the United States, Canada, Germany, and Australia. Internationalizing the study of comparative public policy also requires explicitly including dimensions, such as the level of economic development and also the national political regime type, which may safely be assumed to be relatively constant and thus largely irrelevant, when comparisons are limited to the advanced industrial democracies. Moreover, understanding the policy processes and outcomes of global governance regimes increasingly requires insight into the foreign policy goals of major emerging powers.

• 2015. “Can International Relations and Comparative Politics be Policy Relevant? Theory and Methods for Incorporating Political Context” (with S. Rhodes). Politics & Policy, 43:5, October.

Argues that political and social theory, qualitative as well as quantitative, has clear implications for public policymaking. Begins the task of identifying some common steps in constructing analytical policy histories for non-advanced industrial country cases.