The professional politics of the austerity debate: A comparative field analysis of the European Central Bank and the International Monetary Fund

Abstract

How do different professional structures shape the economic ideas that international economic organizations use to prescribe policy recommendations or derive legitimacy and authority for them? The comparative professional field analysis proposed herein deploys a novel combination of content, network and regression analysis to uncover the precise role of different qualifications, experiences and hierarchies in shaping the economic expertise invoked by the European Central Bank's and the International Monetary Fund's main policy documents, with a specific focus on debates over fiscal consolidation in the wake of the global financial crisis of 2008. The findings challenge much of the scholarship about how economic ideas diffuse across professional domains and where change on macroeconomic policy in international economic organizations is likely to come from. As such, the article should be of interest to scholarship on international bureaucracies, the politics of professional knowledge and the international political economy of fiscal consolidation.

Transnational Economists in the Eurozone Crisis: Professional Structures, Networks and Ideas

“…The data set brought together over 300 economists associated with these two think tanks (171 with CEPS and 149 with Bruegel). 2 I collected data on several indicators, including qualifications, experience, and hierarchy (Lebaron 2012, p. 117;Ban and Patenaude 2019). While network analysis was used to map the connection between economists from different professional milieus, sequence analysis helped to analyse the flow of economists from one professional milieu to another.…”

“…Designed as a case study, this article seeks to bring a twofold contribution to current debates in IPE and EU studies. First, drawing on sociological arguments about professions (Farrell and Quiggin 2017, p. 1;Ban and Patenaude 2019), it connects EU studies to fruitful debates in IPE by seeking to provide insights for a sociology of the EMU, shedding light on the prominent role of academics, think tanks, private and public-sector actors, economists, business and financial interests, whose ideas long contributed to the evolution of the EU's institutional framework and the development of its main policies (Matthijs and McNamara 2015, Mudge and Vauchez 2015, Dyson and Maes 2016. Second, following both the Copenhagen and Strasbourg sociological traditions in the study of fields of power at the global and EU level, this article uses original multimethod research which combines network and sequence analysis to unveil the professional structure of those who design the economic solutions to the EMU's problems.…”

“…The financial crisis in the United States and the eurozone crisis in Europe generated hopes of seeing new policy ideas infuse decision-making in European and global governance. In the United States, the 2008 crisis showed that the neoliberal consensus had reached the point of instability and giving rise to the resurgence of Keynesianism among economists and policy-makers (Farrell andQuiggin 2017, Salas-Porras 2018, p. 243;Ban and Patenaude 2019). In Europe, the early phase of the eurozone crisis did not bring about a change in ideas (Crouch 2011, Green andHay 2015, Carstensen andSchmidt 2016), as, in its fast-burning phase (2010-12), decision-makers sought to solve the problems of the EU's Economic and Monetary Union (EMU) by promoting controversial reforms including fiscal discipline, cuts in government expenditure, and structural reforms in the labour market and the welfare systems (Crespy and Vanheuverzwijn 2017).…”

The transformation of economic analysis at the Federal Reserve during the 1960s

“…research departments of Regional Banks and the Board; they publish a growing share of academic papers, and these tend to have a greater impact than those published by economists outside central banks (see also Fox 2014, Bordo and Istrefi 2018, Ban 2018). This closer relationship between central banks and academia has been interpreted by historians and sociologists as contributing to a "scientization" of central banking, a "process by which explicit, abstract, intellectually calculable rules and procedures are increasingly substituted for sentiments, tradition, and rules of thumb" (Wrong 1970quoted in Marcussen 2009.…”

“…One, mentioned above, is popular among sociologists, political scientists and international relation specialists. It deals with how central bankers have shaped the postwar social, economic and financial international order, and how the institutional and legal foundations of their operations have been transformed (Ban 2018;Lebaron 2012;Baker et al 2017;McGregor and Young 2013). In these works, the economic identity of major protagonists matters in that it structures their policy views and agency.…”