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PIPP: Governance beyond the state

International politics differentiate themselves from state politics as the question of sovereignty is answered differently. States have internal and external sovereignty. A consequence is that they are formally equal entities. Therefore states have to coordinate horizontally and negotiate an order mostly based on the power they can display.

International politics would be similar to national politics if there was a world state with a monopoly of force, rule-making and rule enforcement. However, that is not the case.

Global Governance is contrasted with the anarchy that requires institutionalised forms of co-ordinated actions to produce collectively binding agreements. In contrast to government it is non-hierarchical.

Challenges to global governance are posed by security, welfare and freedom.

Security

The absence of a world police causes insecurity in the form of threats of violence, war, terrorism, arms races and competing alliances.

Welfare

The absence of a regulator and collective-goods-provider causes inefficiency and inequality which further causes market failure, resource depletion, protectionism and underdevelopment.

Freedom

The absence of interference (non-interference) allows oppression in the form of human right violations and autocratic rule.

Game Theoretic Analysis

Game Theory is used to analyse as it offers an analytical framework that captures interactions between independent, rational agents that maximise utility in an interdependent decision-making process.

Coordination game without distributional conflict

A game with two pareto-efficient equilibria. Both have equal utility. It is essential a communication problem that is solved by codification (institution). No bargaining takes place. A typical example would be “oncoming traffic side ” (left or right). Real world example usually involve next generation technologies with no endowment.

Coordination game with distributional conflict

Again it’s a game with two pareto-efficient equilibria. However, there is an unequal utility. There is a problem of communication and distribution. The resolving institution involve codification and distributional rules. The bargaining involves the first-mover advantage and the size of gain. A typical example is the “battle of the Sexes” where each partner prefers a different activity but wants to spend time together, so the utility of doing something together one doesn’t like is still higher than doing something alone one likes. Coordinating deep free trade agreements often take the form of this game.

Coordination game with rivalry

A game with three pareto-efficient equilibria. There is an unequal utility. The problems involve communication, distribution and reputation. Institutions provide prevention of non-cooperation. In the bargaining process there is a last-mover advantage (or brinkmanship). The game of “Chicken” (two drivers driven towards another head-on the loser deviates first) is a famous example and in the real world the euro crisis.

Dilemma game without distributional conflict

A game with two equilibria, one of which is pareto-efficient, also know Assurance Game. The problems are mistrust and uncertainty. Institutions can offer monitoring and capacity-building. There is no bargaining. The textbook example is the stag hunt by Jean-Jacque Rousseau. In the real world international infrastructure cooperation projects often run into this kind of game.

Dilemma game with distributional conflict

A game with a separation of optimal and equilibrium solutions, also know Prisoners’ Dilemma. The problems are mistrust and credibility of commitment. Institutions can offer monitoring and sanctioning. There is bargaining in the form of betrayal and non-compliance. The textbook example is the Prisoners’ Dilemma. In the real world the Tragedy of the Commons is the common appearance of the game (e.g. climate change negotiations).

Asymmetrical domination game

A game with one equilibrium and an unequal utility. The problems is a lack of incentive to cooperate due to an “upstream/downstream” situation. Institutions can offer an increase of scope. There is bargaining in the form of side payments and issue-linkage. The historical case is polluting a river upstream in one country and the downstream country having to deal with it.

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PIPP: Democracy & Governance

Mechanistic institutional definitions of a democracy are based on the electoral systems and the powers it hands to officials. There are also soft definitions of democracy that focus on citizens’ rights to form interest groups (pressure groups, political parties, etc.) and judicial protection of citizens.

The quality of a democracy can be rated based on different criteria. Different organisations use different criteria (e.g. Freedom House, Economist Intelligence Unit, Polity IV) which leads to disparate interpretation of which countries have a good democracy. Implications of criteria have been well studies and can be used to make inferences on economic, social and environmental conditions.

Democracies are a reflection of the history of a country in their institutions as much as in their party landscape.

Change in democracies

Erosion of democracy is usually accompanied by restrictions on media and group formation as well as interference with the judicial system (e.g. Hungary). On the other hand strengthening of democracy is usually founded on more free media and an independent judicial system (e.g. Brazil).

Mono-causal explanations for the rise and fall of democracy fail to prove a strong relation. The complexity behind change is still difficult to grasp. Nonetheless, particular development trajectories from autocracy to democracy and vice versa are well understood, but cannot be generalised as no generalisable necessary or sufficient conditions exist.

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PIPP: Legal Families

The major legal families are civil law and common law. This is a short overview that ignores several details for a coherent view.

Civil Law

Civil Law is prevalent in Continental Europe. Central features are

  • codification,
  • parliaments make the law,
  • judges interpret the law
  • central figures (i.e scholars who argues doctrinally and creates abstract principles from which he derives the outcome of a  case),
  • subdivision of courts.

It has its historic roots in Roman Law. Within the civil law tradition there are some differences. The French legal system is a major influence in modern civil law, especially the Code Civil from 1804. The style of court decisions consists usually of one single sentence (several pages long), facts of the case are very short, very brief and terse (no obiter dicta, no citations, no doubts), and the personality of the individual judge plays no role. The Germanic legal family has influences beyond its geographic area (in Greece, Turkey, Japan and South Korea). It is marked by a scholarly discourse at German universities.

Judges usually rule within the strict definition of the law and defer to the parliament if they believe that a law should have been different.

Common Law

It is prevalent in the Anglo-Saxon World and the Commonwealth countries. It central features are

  • Judge-made law,
  • Case-based reasoning,
  • Central figures are judges who reasoning from case to case, fact-based, distinguishing cases and they developing the case law further,
  • Binding precedents “stare decisis” doctrine (only the “same” cases are bound, so distinguishing allows you to decide differently)
  • Uniform court system, jury system, compilations of court decisions

It is barely influenced by Roman law, but many parallel developments have taken place.

A consequence of the judge-centring is that judges also consider policy relevance of their judgements.

Convergence

In Common Law countries the importance of judge-made laws decreases over time and becomes more similar to Civil Law countries (i.e. the US parliament creates more laws).  The stare decisis doctrine has become more flexible. On the other hand, in Civil Law countries some areas become more case-based. For instance, Tort law in Continental Europe is very case-based as the parliamentary law provided is to abstract to be directly applied.

Concepts of legal rules

Legal rules do not only prescribe behaviour, they also

  • enable behaviour,
  • create institutions,
  • create rights,
  • describe procedures.

Legal subject are either natural persons or legal persons (corporations, government institutions, universities). This has impacts on criminal liability, who benefits from fundamental rights or who can enter into a contract and who is liable in tort law. For instance, a legal person cannot be jailed, but it can be fined.

An important distinction is between privity of contract (inter partes) – i.e. contracts and torts – and right against all the world (erga omnes) – i.e. property and intellectual property law. The second kind of law allows to lay claims against other parties without having any contract with said party.

Some notes:

Stare decisis was invented by 13th century UK courts and after being uphold for centuries courts started to deviate and “overrule” some older rulings, especially if they believed themselves to be more “authoritative”.

Looking for the “right” decision in law is the wrong perspective. Law is more about resolving conflicts and enforcing them. Therefore, it is always a delicate balance between resolving conflicts and democratic values uphold by the sovereign.

Some definitions:

A EU directive is a rule that member states have to implement it as a regulation. It does not bind EU citizens, but there must be a national regulation that enforces the directive. The regulation then is binding. If a directive is not implemented, the European Court of Justice (ECJ) awards damages (usually on a daily basis, which quickly accumulates to a substantial sum) against the member state. A EU regulation is directly binding to citizens and it must not be implemented by member states. The EU directives are created in areas where the subsidiarity principle should hold. The EU regulations are created to harmonise between the member states. The ECJ is also in charge of interpretation of EU directives that then can be used in national courts to interpret national law.

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PIPP: Hierarchies in the Law

In a national legal system there is usually public law (interaction between governments and citizens, e.g. a university awarding a degree to a student) and private law (interaction between citizens, companies in any combination, e.g. a university buying a computer). Private Law is divided into major families are Substantive Law and Commercial Law, whereas Public Law is divided into Substantive Law and Procedural law (administrative processes).

Substantive Law are descriptive of what is allowed (both in Private and Public Law).

Procedural Law is about how enforcement can be performed.

Another view on law is a hierarchy layered as

  1. Constitution
  2. Statutes (created by parliament)
  3. Regulation (created by administration)
  4. Customary law
  5. Case law (created by courts)

Usually lower layers of laws need to be compliant all layers above. Switzerland has a special case where the federal court cannot constitutionally review federal legislation (i.e. statutes cannot be checked whether they go against the constitution). The statutes of cantons can still be checked for constitutionality. Another caveat that the federal court found is that higher statutes than the federal statutes can be used to review a federal statue against. This is the case for the European Convention on Human Rights which Switzerland has accepted to be statutes above federal statutes. In the case of the “Ausschaffungsinitiative” the federal court could not review the federal statue. But as the constitution is nearly equal to the higher statutes they ruled on it as a ruling in relation to the higher statute of the European Convention on Human Rights.

Conflicts between Laws

Conflicts between laws are resolved with different methods and the three most common are: Lex superior means that a body of higher authority can make a decision contradicting lower bodies. Lex specialis means that for a case the most detailed rules describing the case applies. Lex posterior means that the newest laws applies to a case.

International Law

A legal action within a sovereign has an negative impact on another sovereign, the question arises how to handle the situation. Most courts are restricted to their sovereign and therefore cannot rule. In the first such case between Canada and the US about a smelter in Canada polluting the US they created an ad hoc court whose ruling would be legally binding. However, the court was only allowed to judge this single case.

Generally, international laws are based on agreements between sovereign countries. Enforcement therefore relies on being part of agreement. Consequently, there is no separation of powers, no central institution to create/enforce laws, no court has a mandatory jurisdiction and most decisions must be unanimous. The EU is a special case where the executive creates laws (in contrast to the division of power) as it is a product of international law.

In Europe four bodies govern most of internation law: The European Union (EU), the European Free Trade Association (EFTA), the European Economic Area (EEA) and the European Convention on Human Rights (ECHR). Switzerland is member of EFTA and ECHR. Switzerland is also the only member of EFTA that is not in the EEA.

The EU can be seen as a federation of 28 European countries. The EFTA is a free trade agreements with no customs union. The EEA is an extension of the EU internal market. The ECHR is a treaty on human rights.

Smaller nations often use larger nations law as reference for their laws. On the one hand for compliance reasons, but also as larger nations have more legal experience (i.e. more cases to decide) and can therefore have a precedence.

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PIPP: Characteristics of Law

Public Institutions and Policy-making Processes (PIPP) covers three modules: Law, general (Public) Institutions, and European and International Institutions in particular. The first part of the course will be about law. The focus is not on becoming a lawyer, but rather to be able to understand the thought processes behind legal decisions and their implications.

Creation of Laws

One reason for laws is to regulate behaviour. For instance, it is prohibited in Zürich to own dangerous dogs (prohibition). Additionally, any dog owner must have an insurance to cover for any remaining danger from dogs (order). Another case would be the federal decision to drive on the right side in Switzerland (coordination).

Another reason for laws it to create predictability. Zoning laws are a classical example where rules are placed on how buildings must be developed to guarantee safety, aesthetics, social demands and more.

Another field for laws is to protect freedom. Usually fundamental rights are defined in a constitution and must be uphold by the government. For instance, “every person is equal before the law”. Specifically, the laws where created to protect the people from the government. However, in some areas it has been expanded to the private sector. In the case of Switzerland the equal pay is written into law, but all other laws applicability is usually decided in court.

An issue that comes up at the point of creation of a law is that it also represents societal interests which  may contradict previous law. In Switzerland the constitution guarantees no discrimination. To increase women participation in the work force laws to prefer women in hiring over man could be enacted which in turn could be seen as discrimination against male workers.

Interpretation of Laws

Disputes about the law are more often about whether a law applies or not (burden of proof). Usually laws are applicable even if a person may not know about it (ignorance does not protect from punishment). However, the knowledge must be attainable. For instance, retro-active punishment for new laws is usually not allowed. Some laws (usually parliamentary or judicial) are published to a collection, it is assumed that people then know the law or could have known the law.

If laws are enacted by an entity other than the parliament, they may be published in a written form or not. The rule of publication then could be attached to an act (e.g. drawing a no-parking line makes it a publication of the law to not park there).

Publication rules can be challenged in court if there is reasonable doubt that is was possible to acquire the knowledge from the publication. However, public interest can even supersede this. For instance, if a car is parked legally, but the parking regulation changes and the car is not moved within a reasonable time, it can be removed, even though at the time of parking it was legal. If the owner was on holidays for month he could probably not challenge his car being towed. Nonetheless, such cases are not part of the law and are often decided by court. This in turn means that cases that are similar, but not the same, it is often necessary to bring forward similar cases.

Courts are ordered hierarchically and decisions can be fought on each instance. In the first instance a ruling is usually not nationally bind, however, higher instances may become binding. In the Anglo-Saxon world (common law) a court ruling is binding without time limit. In civil law the highest court can review its position on previous ruling in a new case.

Back to the example of the parking. If a car is towed away by a private company. To reduce insolvency risks for the city, often the billing for towing is directly send from the company to the parking regulation violator. This is in contrast to usual contract law where both sides mutually agree on the contract. However, the car could be damaged in the process and the question becomes whether the city requesting the towing or the company performing the towing has to pay for the damages. The complication of a transaction is a major topic for the study of law.

Interpretation is difficult and courts often have to weigh between being activist and setting/changing the societal environment (e.g. the US Supreme Court case to allow gay marriage) and leaving the question open for parliament to decide.

Enforcement of Laws

Laws are generally binding and thereby enable the government to enforce the laws. These are usually covered by laws that specify the punishment. Specific sanctions include incarceration, fines and compensation.

Laws are created on different levels of governance with different scopes. Statutes are created by parliament and apply to the whole population. Court rulings are only applicable in a specific case trailed. Regulations are created by administrative bodies (in compliance with statutes) and apply to all citizens within the administrative body (e.g. students at university have to follow study regulations to obtain a degree).

“Soft law” are memorandums of understanding, codes of conduct or similar informal setups that have no formal enforcement mechanisms. Especially, between countries such arrangements are common. Enforcement is limited to reputation loss and reduced interaction.

Social Norms, Morality and Law

Morality and Laws are not the same. Laws are binary decisions where an action is either permitted or not. Morality sets standards to evaluate behaviours as “good”, “not so good”, or “bad”.

Trade-offs in legal decisions

Legal decisions often compare incommensurable values. One instance is the danger of monopolies in news sector for political discourse. Anti-trust authorities judge mergers on whether they cause monopolies and may stop them or require companies to sell of assets before they merge. Google acquired Doubleclick in 2007 (Story & Helft, 2007) and anti-trust authorities had to decide whether this causes negative effects for society.

Another instance may question whether efficiency or fairness  matter more. “Does a rancher have to pay damages if his cattle damage the corn of a farmer in the neighbourhood?” If fairness is considered the answer should be yes. If efficiency is considered, then it could be argued that the injured farmer should pay because he is the cheapest cost avoider – e.g. he should build a fence to stop the cattle from entering his ground.

In both cases the value/cost cannot be determined and therefore a policy decision must be made on what kind of law is preferred.

References

Story, L., & Helft, M. (2007, April 14). Google Buys DoubleClick for $3.1 Billion. The New York Times, p. 0. Retrieved from http://www.nytimes.com/2007/04/14/technology/14DoubleClick.html?_r=0

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