Research on women and trade policy presents mixed findings: Public opinion studies consistently found women more protectionist than men; yet, legislative research found women sometimes support higher tariffs and sometimes support liberalization. We argue these inconsistencies reflect how trade is framed. When trade is presented as a foreign policy and development tool benefiting women in developing countries, women are more likely to support liberalization. Women's support for trade depends on perceptions of who benefits, and is conditioned by individual risk tolerance. We test this argument using two empirical strategies. First, we use a survey experiment with US respondents to demonstrate that women increase their support for trade when it is framed as benefiting women in developing countries. This positive association is stronger among risk-tolerant female respondents. Second, we examine the policy implications of the argument and our individual-level findings. Using tariff data from Organization for Economic Cooperation and Development (OECD) countries and instrumental-variable approaches to address endogeneity, we find that more women in legislatures in developed countries is associated with lower tariffs. These results help reconcile contradictory results in the literature and underscore the importance of recognizing trade as a multidimensional domestic and foreign policy tool.

Does American influence help or hinder the capacity-building of partner states? In Hierarchy and the State, Patrick E. Shea challenges the conventional wisdom that US influence undermines state-building in developing countries, instead arguing that US support has actually enhanced state capacity over the past forty years. The book asserts that American economic power plays a pivotal role in enhancing a state's ability to build and sustain itself. Tracing the evolution of US property rights promotion from 1782 to the present, it reveals the complex interplay of economic and security interests that shape American foreign policy. Through cutting-edge quantitative techniques and original data on US hierarchy, Hierarchy and the State provides robust evidence for the mechanisms linking international influence, property rights, and state-building outcomes. Its novel framework will change the way scholars examine the international politics of state-building.

Sovereign default should theoretically lead to creditor punishment through higher borrowing costs or market exclusion. However, empirical evidence shows that punishment is inconsistent across defaulters. We argue that this disconnect can be explained by examining the role of geopolitical relationships, particularly with the United States. US support conditions expectations of both borrowers and creditors by providing a fiscal cushion and subsidized insurance. This dynamic incentivizes riskier financial behavior, increasing default likelihood. Paradoxically, post-default US support signals a greater ability to pay, reducing creditors’ incentives to punish. Using data on commercial defaults from 1970 to 2012, we find that states with higher levels of US support are more likely to restructure their debts. After restructuring, these states face lower borrowing costs and experience shorter periods of exclusion from bond markets. Our findings contribute to our understanding of the complex interplay between geopolitics and sovereign debt.

Foreign reserves provide developing countries with resources for managing the effects of economic shocks and crises. Why do reserve levels vary across the developing world? Political business cycles (PBCs) have been associated with reserve level decreases, as incumbents draw them down to fund policies that provide voters with material benefits before elections. But governments can also obtain capital by borrowing on bond markets, getting the resources needed to fund PBC policy efforts through alternative means. We hypothesize and find that this means global finance conditions the PBC effect on foreign reserve levels. When pre-election global interest rates are high and borrowing is expensive, governments do draw down reserves. But when pre-election global interest rates are low and borrowing is cheap, governments borrow rather than deplete reserves. This helps explain variation in reserve levels, and thus variation in resilience against economic shocks, across developing countries. The study further suggests the importance of accounting for reserve use in studies of PBC effects on debt, adds novel PBC identification strategies to the literature, and signals how the politics of diverse areas of economic policymaking can be affected by global financial conditions.

Why do US voters allow politicians to hold the country’s economy hostage during debt ceiling negotiations? In this research note, we argue that ignorance and uncertainty over the consequences of a debt ceiling breach play a nontrivial role in public support for hard-line negotiating positions. In a pre-registered survey experiment, two weeks before the June 2023 deadline to raise the US debt ceiling, we show that providing credible information about the consequences of default increases support for concessions among both Democrats and Republicans. Further, more certain information about the consequences of a debt ceiling breach has a larger effect than less-certain information suggesting that the unpredictable consequences of the crisis also help explain voter reluctance to accept concessions. The findings have implications for understanding debt ceiling negotiations and other crisis bargaining situations where the public serves as a relevant third party.

Abstract This chapter explores the landscape of war finance in the twenty-first century, emphasizing the globalized nature of funding mechanisms that support military operations across the world. War finance has shifted from a traditional, state-centric operation toward a more complex system involving a mix of state and non-state actors, leveraging global financial markets and technologies. The discussion highlights how these actors access international capital markets, utilize digital currencies, and engage in economic strategies that blur the lines between economic and military warfare. This comprehensive overview not only sheds light on the mechanisms of war financing in the modern era but also prompts a reevaluation of the implications for international security and economic policy.

What are the political implications of Chinese loans to borrowing countries? Our argument is that similar to other forms of international finance, loans from China provide leaders with additional resources to maintain their power. The nature of China's lending practices-characterized by an absence of good governance conditions-offers a unique advantage to political leaders, allowing corrupt leaders who receive loans from China to stay in power for longer periods. To support this argument, we conducted an analysis of a dataset of 115 developing countries from 2000 to 2015, focusing on the relationship between Chinese loans and leaders' political survival. Our findings indicate that Chinese loans positively impact leader survival, with the strongest effects observed in more corrupt regimes. To address endogeneity concerns, we employ a shift-share instrumentation strategy and several additional tests. Our analysis underscores the importance of Chinese lending to both international and domestic politics.

How does domestic politics affect sovereign credit risk? To date, scholars have largely focused on how economic interests along class-cleavages influence sovereign default risk and borrowing costs. Ethnic dynamics are another important political factor that explains governments' creditworthiness, yet are understudied. We investigate how ethnic politics shape governments' credit access and argue that the fiscal incentives generated by ethnic coalitions influence credit risk differently than those created by class cleavages. Because ethnic coalitions are usually smaller than class coalitions, left governments with ethnic support can commit to lower spending and receive more favorable risk assessments. Right governments that rely on ethnic support, however, will have greater spending demands because of their need to satisfy ethnic groups. We test our argument using a new indicator of government ethnic support and four indicators of sovereign credit risk. We find that, in emerging markets, the borrowing costs of right governments increase as they become more dependent on ethnic groups for political support. Our findings suggest that financial markets are attuned to multiple dimensions of domestic politics and demonstrate that ethnic divisions can have strong implications for governments' access to credit.

Many countries in the Global South have increased their exposure to Chinese debt in recent years. With the COVID-19 pandemic and the US interest rate hike, many countries have struggled to meet their debt repayment obligations. As a result, they have turned to the International Monetary Fund (IMF) for emergency assistance. We argue that the involvement of the Fund wipes out much of the political benefits of China loans for executive leaders of borrowing countries. IMF conditionality requires countries to increase fiscal transparency, which threatens the viability of kickback schemes and increases the likelihood that corrupt leaders will be called out on their misdealing. As a result, we expect corrupt leaders with China debt to leave office earlier when they try to address debt defaults with IMF loans than when they avoid them. Using survival analysis on a dataset of 115 developing countries between 2000 to 2015, we find that leaders indebted to China that go under an IMF program leave office earlier compared to when they do not go under an IMF program. In line with our argument, this effect is strongest in more corrupt regimes. Our argument and analysis contribute to understanding international finance's political economy, specifically how mixing creditors can be politically risky for leaders.

How do external threats affect leaders' incentives to repress? We argue that external threats both increase and decrease state repression, but through different causal pathways. Directly, external threats provide leaders with political cover to use repression against political opponents. Indirectly, threats incentivize leaders to augment state capacity, which decreases the likelihood of state repression. To test this argument, we develop a new latent measure of external threat using a Bayesian measurement model. We use mediation analysis to examine the direct and indirect effects of external threats on repression in developing countries from 1980 to 2016. We find that external threats increase government repression directly, but indirectly decrease repression through stronger state capacity. Our findings have implications for how international factors connect to domestic politics to help explain state repression. In addition, our new measure of external threat will help scholars study the consequences of the international threat environment.

Do women leaders enact more hawkish foreign policies? Some research argues women leaders are more likely to adopt aggressive and masculine characteristics to obtain national office. As a result, women leaders should exhibit more hawkish behavior than men. In this study we re-examine the relationship between the women leaders and foreign policy by focusing on military spending behavior. We argue that conventional empirical methods, such as linear regression, are ill-suited to examine data on women leaders and military spending. These methods are sensitive to outliers and small sample sizes: two characteristics of women leadership. To address these issues, we use the synthetic control method to estimate the military spending behavior of women leaders. By creating unique synthetic counterfactuals for three prominent women leaders – Thatcher, Gandhi, and Meir – we analyze what would have happened if a particular state had a male leader. Generalizing beyond these cases, we also conduct a multiple treatment test that examines the effect of women leadership jointly across multiple countries and time periods. We find that women leaders do not spend more on the military than men. We analyze plausible explanations of these null results and discuss their implications.

Leaders need resources to maintain power. To secure these resources, states can develop their own extractive capacity or seek external support to help subsidize their costs. In this study, we argue that extractive capacity and external support are not always alternatives. We focus on how US support can foster local property rights, which subsequently builds extractive capacity. We then argue that states with more capacity are better able to either alleviate rebels’ grievances or deter rebels from mounting a military challenge. We use mediation analysis to test these expectations with a data set on capacity, US support, and civil conflict from 1970 to 2012. We find empirical support for the role of property rights and capacity as mediating factors between US support and civil conflict. Our results have implications for international explanations of civil conflict and the role of US patronage in capacity development.

Do alliances allow states to share defense burdens and reduce military spending? Despite expectations that alliances should lead to decreased military spending, the empirical record offers mixed findings. We argue that not all alliances are reliable; thus, only allies that receive signals of reassurance will rely on the external security of allies and subsequently reduce their military spending. Compared to states that do not receive additional signals, these reassured allies will have greater confidence that an ally will come to their aid. As a result, third-party aggressors are deterred and the demand for military spending will decrease. We test this argument with an analysis of US signals of support, alliance commitments, and military spending. We find that American alliances without additional signals of support have a negligible effect on military spending. Yet, we observe that alliances are negatively associated with military spending when signals of support are present. Additional tests indicate that alliance commitments, coupled with strong US signals, are also associated with lower military spending in the rivals of US allies. Our results potentially help explain the mixed evidence in the arms-versus-allies and burden-sharing literatures and further demonstrate that extra-alliance signals play an important role in the practice of International Relations.

To reconcile the discrepancy between survey research and policy outcomes related to gender and trade, we argue that women legislators are more likely to perceive trade liberalization as a foreign policy instrument to improve the living conditions of women abroad. Hence, as more women gain legislative seats in developed countries, tariff levels towards developing countries will fall. We analyze our explanation using four empirical strategies: a panel of developed countries from 1990-2019; an instrumental variable approach; third, U.S. Congressional roll call votes on trade bills; and an experimental survey. We find that women are more likely to support trade liberalization when it is perceived to improve the living conditions of women abroad. We also find that women with higher tolerance for risk are more likely to support free trade. Our findings have implications for studies of women’s descriptive representation and the determinants of foreign policy.

Open governance requirements are designed to improve accountability, which implies that transparent governments are more trustworthy stewards of their publicly invested power. However, transparency may also reduce institutional effectiveness and inhibit political compromise, diminishing the capacity to manage resources responsibly. We assess empirical support for these competing perspectives in the context of American state legislatures, many of which have become exempt from state sunshine laws in recent decades. We leverage variation in the timing of these legislative exemptions to identify the effect of removing transparency in a crucial governing institution on investors’ risk perceptions of states’ general obligation bonds. Our analysis of these data during the period 1995–2010 suggests that removing legislative transparency reduces state credit risk. We conclude that while openness in government may be normatively desirable, shielding legislative proceedings from public view may actually be better for states’ debt repayment capacity, improving their overall fiscal health.

Finance is often considered a constraining or compelling force in war. This article examines an alternative role of finance in war, asserting that investors can inform states about adversarial intentions and resolve under certain conditions. This signaling mechanism can reduce information asymmetry between states and decrease the probability of conflict. In the context of these theoretical expectations, I examine the case of Austria and the Rothschild Bank in the nineteenth century. I find that instead of being a constraining force on Austrian foreign policy, the Rothschilds helped inform Austria and other European powers during interstate crises. The information provided by the Rothschilds helped Europe avert war in several cases during the nineteenth century.

When do private creditors versus debtor states accept a greater burden in resolving sovereign debt crises? In this study, we argue that distributive politics helps explain the “haircut”—or losses—private creditors take in debt restructuring cases. Despite the expected convergence of partisan policies in a globalized economy, we argue that right and left leaders extract different settlements in debt negotiations. Left governments, representing constituents most likely to be hurt from higher debt repayment, credibly demonstrate more bargaining power and extract greater concessions from creditors. Distributive politics, however, is an indeterminate factor in explaining states entrance into debt negotiations. We use recently released data on the outcome of sovereign debt restructuring cases between states and private creditors from 1975 to 2013 to test our expectations. Results from a double-hurdle model indicate that creditors receive a larger haircut when negotiating with left governments.

Sovereign borrowing is often used to cover the costs of war. This borrowing, coupled with war's economic disruptions, strains states' ability to honor debt promises. Contrary to conventional expectations, however, we find that default is not common after wars. To explain the relationship between war and sovereign default, this article lays out a selection effect argument: war participants are unlikely to default in the first place, while states likely to default are unable to acquire the financing necessary to fight a war. In sum, states that lack the financial means to adequately borrow avoid paths to war. After offering some examples of the selection mechanism at work, we present evidence that states unlikely to default will avoid entering the war sample. Our findings have implications for the inferences researchers make about war finance and war onset.