Submission Deadline: August 29, 2016

ASAP, Global Financial Integrity and the Yale Global Justice Program are soliciting original essays of ca. 7,000 to 9,000 words on the non-revenue impact of curbing illicit financial flows for the third annual Amartya Sen Prize.

Poor populations are hurt when rich individuals and multinational corporations surreptitiously shift trillions of dollars in wealth and profits out of less developed countries. One harm arises from the loss of tax revenues incurred by their governments. By concealing their profits or wealth, MNCs and individuals evade taxes on profits, dividends, interest and/or capital gains—taxes that could fund social spending or tax reductions for ordinary citizens.

This year\’s submissions are to focus on the other harm from illicit financial outflows: the loss of capital to a poor country\’s economy, which may well substantially exceed the revenue loss. Such capital loss occurs when, often to dodge taxes or tariffs, individuals and companies of all sizes move wealth and profits offshore illicitly, e.g. through trade misinvoicing. Authors might choose to discuss the potential economic impact of reducing such capital losses: the impact on savings, investment, trade, interest rates, consumption, employment, economic growth, and/or culture and the arts, for example. In this context, it would be interesting to explore what policies domestic and international authorities might adopt in order to discourage the export of private sector capital and to amplify the beneficial effects of curbing illicit financial outflows. The latter exploration raises the partly moral question of how to value these effects from the standpoint of a less developed country\’s poor majority.

Authors might also tackle the challenge of estimating the magnitude of such capital losses. Is some of the capital now illicitly removed brought back openly as new investment? Would some of the capital now illicitly removed be exported anyway, openly, even if there were no opportunity to shift it out in tax-dodging ways? Would some of the MNCs now illicitly shifting profits out have refrained from entering the country in the first place without the prospect of tax-dodging profits, and would such failures to enter be counterproductive to the interests of the developing countries?

The above lines of thought are meant to be suggestive rather than exhaustive. We hope for a creative diversity of submissions that provide a rich and well-grounded picture of what our world could look like—especially from the perspective of the poor — if illicit financial outflows from the less developed countries could be substantially curtailed.

The best entries will be presented at an international conference in the fall of 2016 at Yale University and subsequently published in a special issue of a prominent journal. In addition, at least two of the winning essays will receive a monetary award: a first prize of $5,000 and a second prize of $3,000. 

Please email your entry to ian@academicsstand.org by Monday, August 29 at 5pm ET. We ask that entries be anonymized to facilitate blind refereeing. Winners will be selected by an expert jury, whose decisions are final.

ASAP has co-funded a new Oxford University Press anthology, co-edited by ASAP Board President Thomas Pogge, and due to be published in Feb 2016: Global Tax Fairness.

Briefly, the book addresses fifteen different reform proposals that are urgently needed to correct the fault lines in the international tax system as it exists today, and which deprive both developing and developed countries of critical tax resources. It offers clear and concrete ideas on how the reforms can be achieved and why they are important for a more just and equitable global system to prevail. The policy reforms outlined in this book not only advance tax justice but also protect human rights by curtailing illegal activity and making available more resources for development.

The Global Poverty Consensus Report (GPCR) is a joint project between ASAP and the Comparative Research Programme on Poverty (CROP). It aims to highlight the existing academic consensus on the causes and remedies for global poverty. Based on thirty-nine interviews done by Gilad Tanay in 2012, the analysis was written by Alberto Cimadamore and Lynda Lange. The final report is now available for download. More information on the project is available here.

FOR IMMEDIATE RELEASE. We are a global community of scholars from a range of disciplinary and geographic perspectives. We are concerned about the refugee crisis that is presently unfolding in the wider Mediterranean region and distressed by the inadequacy of official responses thus far.

Each year, the UN Food and Agriculture Organization (FAO) published a State of Food Insecurity (SOFI) report. The 2015 report has just come out. In an accompanying letter, the FAO’s Coordinator for Economic and Social Development, Jomo Kwame Sundaram, summarizes its message as follows: “With the number of chronically hungry people in developing countries declining from 990.7 million in 1991 to 779.9 million in 2014, their share in developing countries has declined by 44.4 per cent, from 23.4 to 12.9 per cent over the 23 years, but still short of the 11.7 per cent target.” We may not quite achieve the halving of chronic undernourishment envisaged in the first Millennium Development Goal (MDG-1), but we will get quite close.

By Jack Corbett and Sinclair Dinnen

The reabsorption of autonomous or semi-autonomous aid agencies into departments of foreign affairs in New Zealand (2009), Canada (2013) and Australia (2013) has sent ripples across the international development community. Following a persistent two-decade trend towards greater autonomy and independence of aid policy in these countries, but also in places like the United Kingdom, this shift appears to represent a significant change to the status-quo.

Two pressing questions have arisen from the trend toward reabsorption:

• Will it radically change the focus of aid policy, and if so how?
• How will it change the nature of development administration?

Reforming politicians have been quick to proclaim an era of radical policy change, with Australian Foreign Minister Julie Bishop heralding the emergence of a new ‘aid paradigm’ that is encapsulated in the following:

\”The world has changed – and our aid program must change too. Today, many developing countries are growing rapidly, with aid representing an increasingly small proportion of development finance. To be effective in this new context, our aid needs to be more innovative and catalytic, leveraging other drivers of development such as private sector investment and domestic finance. Our aid needs to support economic growth as the most sustainable way to reduce poverty and lift living standards. We need to recast our aid paradigm in light of this new development paradigm.\”

For Bishop, aid is a form of \’economic diplomacy\’ that serves Australia’s foreign policy and commercial interests by promoting prosperity among its regional neighbours. And, the new integrated aid program will be structured to achieve this despite a drastically reduced budget, reflecting cuts of more than 6 billion US dollars over five years from 2014.

In Canada, the narrative around administrative change has been more circumspect, playing down the radical nature of the reform and instead positing that these changes reflect a desire to align objectives and produce efficiencies. In 2013, the Department of Foreign Affairs and Trade absorbed the Canadian International Development Agency (CIDA) and was renamed the Department of Foreign Affairs, Trade and Development under the government led by Conservative Prime Minister Stephen Harper. That occurred several months before the changes were announced in Australia.

The changes to Australia\’s aid administration are, however, potentially much more significant. In the early 1970s, the founders of the Australian Development Assistance Agency (ADAA) believed that for the aid program to thrive, it needed a powerful lobby in the capital, Canberra, which would safeguard its interests against populist or merely thrifty politicians. To that end, the then-Whitlam Government sought to create a professional and autonomous aid agency staffed by development experts with its own career structure and recruitment patterns. ADAA was in fact abolished by the incoming Fraser government in 1976 and later reabsorbed into the then Department of Foreign Affairs, but the ideal of a professional and autonomous aid agency retained currency.

In contrast, from 2013 Australia\’s preeminent aid bureaucrat is now the Secretary of the Department of Foreign Affairs and Trade (DFAT), Peter Varghese, a career diplomat and former head of the Office of National Assessments, with day-to-day administration undertaken by that department’s desk officers. This move is reminiscent of the way the Australian aid program was organised in the 1960s.

The specifics of how this decision was reached and whose advice it was made on – officials or political staff – remains a mystery to even those at the highest echelons of the former AusAID. Abolition was not part of the conservative Liberal Party-led Coalition\’s election platform. Indeed, as shadow foreign minister before the Sept. 2013 election, Julie Bishop had indicated that a junior Minister for International Development would be appointed in her portfolio. In this sense, the move was entirely unheralded.

While the changes may appear dramatic and profoundly transformative when viewed from the inside of the bureaucracy, they appear less so when placed in the context of more than half a century of development thinking, both at home and abroad. From this perspective, while the administrative change is potentially profound, the new policy settings do not to constitute a paradigmatic change. The emphasis on growth and private sector investment, and recognition that aid is only a small part of a much bigger development finance picture, is hardly new.

The administrative changes, however, effectively herald the end of an era that began in earnest in the late 1960s and early 1970s when the merits of a professional and autonomous aid agency were first canvassed by Australia’s policy elite. Certainly, in making these changes the government hoped to affect not just the policy settings but also the management of the program. The implication being, of course, that AusAID\’s staff would not have been sufficiently responsive to the government of the day. We will never know whether that would have been the case. There is a certain irony embedded in this assessment, however, given that AusAID\’s crimes were said to include increasing aid to Africa and the Caribbean, both of which were at least in part a response to the Australian Government’s campaign for a seat on the UN Security Council in 2013-2014.

What we do know is that a substantial cohort of practitioners, along with years of experience and expertise, has left the Australian Public Service as a result of this decision. They are not all gone – we certainly acknowledge that DFAT retains a level of policy expertise in this area – but it is hard not to argue that the value placed on their skillset has now been diminished by the abolition of AusAID. If anything about the new arrangements hints at a paradigm shift, this is it.

The Authors:

Jack Corbett is a Research Fellow at the School of Government and International Relations at Griffith University, Brisbane, Australia

Sinclair Dinnen is an Associate Professor at the Coral Bell School of Asia Pacific Affairs, The Australian National University, Canberra

Submission Deadline: August 31, 2015

The Yale Global Justice Program, Global Financial Integrity, and Academics Stand Against Poverty invite submissions of original essays on illicit financial flows to the second annual Amartya Sen Prize Competition. Prizes are named in honor of Amartya Sen, whose work has shown how the rigor of economic thinking can be brought to bear on normative and practical questions of great human significance.

Illicit financial flows are international movements of funds that have been illegally earned or are being illegally transferred or utilized. Such flows may involve proceeds of corruption or other crimes – or be associated with efforts to evade corporate or individual taxation. According to the NGO Global Financial Integrity, developing countries are especially harshly affected by illicit financial outflows, losing some $6.6 trillion in the decade ending in 2012 and about $1 trillion annually more recently.

The 2015 Amartya Sen Prize Competition is soliciting original essays of ca. 7,000 to 9,000 words on the intelligent use of incentives toward curtailing corporations\’ use of tax evasion and avoidance, abusive transfer pricing and all forms of illicit financial flows. Many have been upset by media reports about how corporations dodge taxes around the world. What can we as consumers and investors do toward curtailing such practices? Consumers can direct purchases away from offending firms. Investors can use the voting rights their shares confer to influence the way corporations manage their affairs, and they can also influence firms by divesting themselves of shares and by shunning certain investments. And people related to large investors (e.g., students at a well-endowed university, participants in a large pension fund) can try to nudge that investor toward exerting more and better influence on corporations.

Efforts by consumers and investors to improve corporate behavior will be much more effective if they are concerted, that is, if consumers and investors reward and penalize the same sorts of behaviors. Such concerted action presupposes objective and transparent standards for assessing corporate behavior as the basis on which consumers and investors can then reward and penalize. Essays will be judged by their contribution toward achieving such effective concerted action. Essays might be predominantly normative, working out, perhaps, what the appropriate standards for assessing corporate behavior should be; they might be predominantly empirical, examining for example how similar efforts have fared in the past; or they might be predominantly practical, experimentally exploring what sorts of incentives are most likely to have the desired effects. Of course, essays might combine normative, empirical and practical elements.

The best entries are to be presented at an international conference at Yale University in the fall of 2015 and are subsequently to be published as a special issue of a prominent journal. (Last year\’s winners are forthcoming in the Journal of Human Development and Capabilities.) In addition, at least two of the winning essays will be graced with a monetary award: a first prize of $5,000 and a second prize of $3,000. Professor Sen joined us for last year\’s award ceremony and hopes to do so again this year.

Entries should be e-mailed to Chelsea Papa at chelsea@academicsstand.org under the subject line \”Amartya Sen Prize Contest Submission\” and must reach her by August 31, 2015. We ask that entries be anonymized to facilitate blind refereeing. Quality judgments will be made by an expert jury, whose decisions are final.

The Tax Dodging Bill, an ActionAid campaign that calls for the next UK government to confront tax abuse, continues to gain support from academics and economists. Thus far, approximately 27,000 people have supported the bill by signing an online petition.

ASAP President Thomas Pogge has signed onto the campaign and encourages members to do the same.

Tax abuse remains a central focus for ASAP because it is so harmful for developing countries. For instance, tax abuse results in significant loss of public revenues that could otherwise be used to combat extreme poverty. Developing countries are much more affected by this issue than wealthier countries because they are more dependent on corporate taxes. Considering that governments play a role in perpetuating tax abuse, the Tax Dodging Bill is pushing the UK government to address the issue by introducing new legislation and reforming existing laws that contribute to the problem.

More signatures and support for the campaign will put pressure on the UK to tackle this urgent issue, which in turn can influence other governments to take a similar stand.

Two cross-cutting debates about development are preoccupying officials, academics and civil society groups in the middle of this decade. One concerns the evaluation of the Millennium Development Goals (MDGs), due to expire at the end of 2015. Some describe them as the most successful poverty eradication effort ever, others as a fraud or abysmal failure. The other debate is about the formulation of the MDGs’ successors, the Sustainable Development Goals (SDGs), to be adopted by the UN General Assembly in September 2015 and meant to guide development efforts until 2030. What goals, targets and indicators should be included in the final document? Who should be involved in the drafting process and how?

Zorka Milin, Legal Adviser to Global Witness, has volunteered to serve as ASAP\’s Director of Research for Financial Transparency. In this role, she will seek to identify opportunities for ASAP, as thinkers and researchers, to influence and intervene in policy debates and advocacy campaigns related to financial transparency and illicit financial flows.

Milin is an international tax lawyer, and at Global Witness she works to improve accountability for grand corruption and to advance tax and revenue transparency in the oil, gas and mining sectors. She is a member of the BEPS Monitoring Group of tax experts and represents civil society stakeholders on the tax working group in the US Extractive Industries Transparency Initiative. She is also serving as a visiting fellow at Yale University, with the Global Justice Program and with the Information Society Project at the law school. She is originally from Serbia and has practiced international tax law for six years with two major global law firms.