Twenty years ago not a single country had a policy against money laundering; currently, over 170 have very similar anti-money laundering (AML) policies in place. Why have so many countries with so little in common adopted the same policy so rapidly? This extensive diffusion is particularly puzzling given the lack of evidence that AML policies actually work. In explaining the international spread of AML policies, this article draws on recent literature from International Relations, sociology, comparative politics, and public policy dealing with policy diffusion and policy transfer, but also differs from most of this work in two key aspects: First, it is argued that the process of diffusion in the developing world has been much more power-based than voluntary. Second, the mechanisms driving policy diffusion (direct coercion, mimicry, and competition) are all shown to be discursively mediated exercises of power, rather than reflecting rational learning or brute material forces. Evidence is drawn from surveys, interviews, and participant-observation in developing countries from three regions.
This article argues that public blacklisting by international organizations can be an effective means of bringing about compliance in otherwise recalcitrant states. This contention is examined in light of overlapping campaigns by the Organization for Economic Cooperation and Development and the Financial Action Task Force to pressure targeted states to adopt costly financial reforms. In a constructivist vein, blacklisting is held to be a form of speech act that changed the world by damaging states' reputations among investors, and thus produced pressure to comply through actual or anticipated capital flight. To be removed from blacklists, thereby preventing future economic damage, those targeted have had to comply with stringent regulatory standards mandated by these international organizations. Evidence is taken from interviews, press accounts, official documents and quantitative data relating to seven affected tax havens as well as Austria and Switzerland.
Conventional wisdom maintains that since 1648 the international system has comprised states-as-like units endowed with Westphalian sovereignty under anarchy. And while radical globalization theorists certainly dispute the centrality of the state in modern world politics, nevertheless most assume that the state retains its sovereignty under globalization. In contrast we argue that hierarchical sub-systems (and hence unlike units) have been common since 1648, and that the international system continues to be characterized by hierarchical (as well as anarchic) relations. The article goes on to reveal the existence of these multiple hierarchic formations and uncovers the differing social logics connected with identity-formation processes that govern their reproduction. Successive religious, racial, socialist and democratic social logics not only constitute their reproduction, but the emergence of new norms, social ideas and identities have to an important extent accounted for the rise and decay of successive hierarchies.
The anti-corruption norm in both scholarship and the policy world has too narrowly focused on the domestic and institutional context of bribe-taking and public corruption. Instead, we argue that corruption in the contemporary global economy requires a multiple set of connected transactions, processes and relationships that take place within informal transnational networks that blur the line between illegal and legal activities. These networks include multinational companies, elites in host countries, offshore financial vehicles and conduits, middlemen and brokers, and destination financial institutions. We examine how these actors operate in Central Asia, a region that is widely identified as corrupt, yet is rarely understood as embedded in the types of global processes, offshore connections and transnational links specified in our analysis. Examples of offshore centers in tax planning from Central Asia, and partial results from a field experiment based on impersonating high corruption risks from four Central Asian states, provide evidence for how the various actors in transnational financial networks structure their dealings. We then present two brief illustrative cases of how these transnational networks have operated in energy explorations services in Kazakhstan and telecommunications contracts in Uzbekistan. Our findings have theoretical, practical, and normative implications for scholars and practitioners of Central Asian international political economy and other "high risk" regions.
Two parallel norms mandate an international duty to hold state leaders individually accountable for serious corruption and human rights crimes. The development of these new norms is poorly explained by realist and neoliberal perspectives, but there are also weaknesses in recent constructivist explanations of norm diffusion that emphasize agency at the expense of structure. Such approaches have difficulty explaining the source of and similarities between new norms, and treat norm entrepreneurs as prior to and separate from their environment. In contrast, drawing on sociological institutionalism, we present a more structural explanation of individual accountability norms. The norms derive from an overarching modernist world culture privileging individual rights and responsibilities, as well as rational-legal authority. This culture is more generative of norm entrepreneurs than generated by them. The specific norms are instantiated through a process of "theorization" within permissive post-Cold War conditions, and diffused via mimicry, professionalization, and coercive isomorphism.We gratefully acknowledge comments and suggestions from
To test whether firms behave consistently with international law prohibiting anonymous incorporation, we conducted a global audit study and field experiment, using data from 1639 incorporation firms in 176 countries. We requested anonymous incorporation and randomly assigned references to international law, threat of penalties, norms of appropriate behavior, or a placebo. We find a substantial number of firms willing to flout international standards and show that those in OECD countries proved significantly less compliant with rules than in developing countries or tax havens. Firms in tax havens displayed significantly greater compliance and were sensitive to experimental interventions invoking international law.
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