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ID: 168197

Blacklists, Market Enforcement, and the Global Regime to Combat Terrorist Financing / Morse, Julia C

Morse, Julia C	Journal Article
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This paper highlights how international organizations can use global performance indicators (GPIs) to drive policy change through transnational market pressure. When international organizations are credible assessors of state policy, and when monitored countries compete for market resources, GPIs transmit information about country risk and stabilize market expectations. Under these conditions banks and investors may restrict access to capital in noncompliant states and incentivize increased compliance. I demonstrate this market-enforcement mechanism by analyzing the Financial Action Task Force (FATF), an intergovernmental body that issues nonbinding recommendations to combat money laundering and the financing of terrorism. The FATF's public listing of noncompliant jurisdictions has prompted international banks to move resources away from listed states and raised the costs of continued noncompliance, significantly increasing the number of states with laws criminalizing terrorist financing. This finding suggests a powerful pathway through which institutions influence domestic policy and highlights the power of GPIs in an age where information is a global currency.

Key Words

International Organizations ; Compliance ; Monitoring ; Indicators ; AML/CFTFATF ; Market Enforcement ;
GPIs ; Blacklist ; Rating

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ID: 163269

Protecting trade by legalizing political disputes: why countries bring cases to the international court of justice / Davis, Christina L; Morse, Julia C

Davis, Christina L	Journal Article
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How does economic interdependence shape political relations? We show a new pathway to support a commercial peace in which economic interdependence changes strategies for conflict management. The uncertainty arising from political disputes between countries can depress trade flows. As states seek to protect trade from such negative effects, they are more likely to bring their disputes to legal venues. We assess this argument by analyzing why countries bring cases to the International Court of Justice (ICJ). Using data on 190 countries from 1960 to 2013, we find that countries are more likely to file ICJ cases against important trading partners than against states with low levels of shared trade. We conclude that economic interdependence changes the incentives for how states resolve their disputes.

Key Words

Conflict Management ; International court of Justice ; Economic Interdependence ; Political Relations

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