The European Union’s Recovery Plan: A Critical Evaluation

This article reviews the European Union’s Recovery Plan to cope with COVID-19 by examining two of its main hypotheses. I primarily use Greece as a case study of those who benefit from receiving funds, and in some cases Germany, because it played, and still plays, an instrumental role in promoting this unfounded idea of transferring European taxpayers’ money to the hands of national politicians. First, it was alleged that the health situation is improving. Second, the pandemic increases economic divergence between member states. The stylized facts so far do not seem to support either hypothesis. Since the July Summit of the European Council, the epidemiological situation has worsened as measured by deaths and cases. Data on per capita Gross Domestic Product released by the European Commission on 6 May 2020 show an unprecedented for peace years decline in economic growth rates for all 27 member states in 2020. The data estimations also assume a V-shaped recovery for 2021. However, the alleged hypothesis of economic divergence in 2020 and economic convergence in 2021 is not supported by the data themselves. The main conclusion of this study is that the economic impact cannot be fully ascertained if the pandemic is not permanently over and therefore the titanic EU spending of 750 billion euro cannot be based on the stylized economic and epidemiological facts. Keywords: European Union, pandemic, Covid-19, health, growth, public pending, recovery plan, Germany, Greece.

Non-Western Modernities in the Middle East: The Israeli Experience of Development and Social Change

Could the unique and divergent modernization experiences of non-Western societies be the proof of a challenge to Western modernity? Could Israel be evaluated as a non-Western modernity model in contrast to the common assumption that Israel is a Western country? This article hinges on the argument that the State of Israel is not a Western country as its type of modernity has significantly diverged from the globalization thesis claiming to eventually unite all societies around Western modernity. This argument is based on a non-Western modernization perspective inspired by the insights of the Multiple Modernities Paradigm (MMP) and the Uneven and Combined Development Theory (U&CD). Today, Israel can be regarded as an economically modern society as it is a highly industrialized and urbanized society with high average living standards. However, what is the most remarkable fact observed in Israeli economic trajectory is that Israeli economic development has been mostly driven by state-led initiatives rather than by private initiatives such as a capitalist bourgeoisie class in the Western trajectory (France, Britain and the USA) where capitalist bourgeoisie class has become primary initiator and driving force of economic modernization. Moreover, this economic divergence naturally impacted on all other transformation trajectories of Israel such as its democratization and secularization processes. Contemporary Israel is neither a fully secularized society nor a liberal democratic one as the Eurocentric globalization thesis expected it to be after a long and arduous process of modernization. Therefore, the case of Israel shows that modernization processes do not follow a fixed, single and determinate way as they produces unexpected and uneven patterns, particularly in non-Western societies – even if they try to Westernise.

A Non-Western Modernization Perspective: The Case of Israel

Could the unique and divergent modernization experiences of non-Western societies be the proof of a challenge to Western modernity? Could Israel be evaluated as a non-Western modernity model in contrast to the common assumption that Israel is a Western country? This article hinges on the argument that the State of Israel is not a Western country as its type of modernity has significantly diverged from the globalization thesis claiming to eventually unite all societies around Western modernity. This argument is based on a non-Western modernization perspective inspired by the insights of the Multiple Modernities Paradigm (MMP) and the Uneven and Combined Development Theory (U&CD). Today, Israel can be regarded as an economically modern society as it is a highly industrialized and urbanized society with high average living standards. However, what is the most remarkable fact observed in Israeli economic trajectory is that Israeli economic development has been mostly driven by state-led initiatives rather than by private initiatives such as a capitalist bourgeoisie class in the Western trajectory (France, Britain and the USA) where capitalist bourgeoisie class has become primary initiator and driving force of economic modernization. Moreover, this economic divergence naturally impacted on all other transformation trajectories of Israel such as its democratization and secularization processes. Contemporary Israel is neither a fully secularized society nor a liberal democratic one as the Eurocentric globalization thesis expected it to be after a long and arduous process of modernization. Therefore, the case of Israel shows that modernization processes do not follow a fixed, single and determinate way as they produces unexpected and uneven patterns, particularly in non-Western societies – even if they try to Westernise.

The role of credit in regional divergence: Spanish regions and Eurozone countries

ABSTRACT This paper provides a theoretical account of the role of regional differences in cyclical patterns of credit availability for patterns of regional convergence or divergence. While mainstream theories imply either equalising regional capital flows, or else lower credit availability for peripheral regions due to market imperfections, Post-Keynesian theory of liquidity preference and financial structure imply the scope for greater credit volatility for peripheral regions, especially in downturns, contributing to real economic divergence. This latter account is assessed by means of an empirical analysis of patterns in bank credit over the business cycle among the Spanish regions and Eurozone countries.

SOCIO-ECONOMIC DIVERGENCE OF UKRAINE AND THE EU: NEW CHALLENGES

The research characterizes current dynamics of Ukraine’s socio-economic development in the process of its European integration in view of the Association Agreement with the European Union concluded in 2014. The comparative assessment of the development of Ukraine and individual EU countries by the criteria of GDP per capita is given. The recent increasing tendency of divergence of the socio-economic systems of the European Union and Ukraine is highlighted, describing the institutional phenomenon of the divergence trap as a result of the synthesis of poverty and non-convergence traps. The risks of Ukraine’s falling into the divergence trap, which are related to the effect of several major internal factors are outlined. The article addresses such factors as Ukraine’s adoption of conditions for restructuring a part of the national debt in 2015; unacceptably low levels of national economy capitalization in the context of convergence; galloping labour migration from Ukraine, which accounts for significant loss of domestic GDP growth potential; and small value of innovation and technology in the macroeconomic development of the state.

Religious Legitimacy and Long-Run Economic Growth in the Middle East

This chapter explores the role that religious legitimacy played in the long-run economic fortunes of various Middle Eastern states. It first lays out a theory of political legitimacy which argues that a society’s laws and policies will be reflective of the bargain made between rulers and those who can provide legitimacy and coercion. To the extent that religious legitimacy is effective, religious authorities will therefore have some seat at the political bargaining table and policies will be reflective of their desires. Since Islam has been an effective source of political legitimacy for much of its history, most political equilibria in Muslim states have involved its use to some degree. This theory is then applied to medieval and early modern (primarily Ottoman) Middle Eastern history to help explain the economic divergence with northwestern Europe. The chapter concludes by highlighting how this theory complements recent theories put forth by Timur Kuran, Lisa Blaydes and Eric Chaney, and Ahmet Kuru.

The Development of Representation in Europe

This chapter analyzes why Europe followed a different economic path from China and the Middle East and explains how political institutions have played a starring role in explanations of divergence. It addresses the question on why political divergence took place when great economic divergence was confirmed by political divergence. It also discusses early democracy that came from the traditions of the Germanic tribes that overran Europe as Rome fell. The chapter looks at human societies that independently evolved the idea of constraining rulers to obtain consent from their people. It confirms whether early democracy was invented by German tribes and assesses whether conditions in Europe resembled those in other places where early democracy thrived.