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Catastrophic Beasts and How to Study Them: Researching Illicit Financial Activities in International Political Economy

Year 2021, Volume: 5 Issue: 2, 215 - 240, 20.12.2021
https://doi.org/10.33399/biibfad.879116

Abstract

There is relatively less attention to illicit financial activities in the International Political Economy (IPE) studies, and it is quite ambiguous how to study these illicit activities. American IPE’s materialistic nature and state-centric approach miss essential features/relations of these illicit activities because they are neither materialistic nor state-centric. On the other hand, the British school is more suitable than American IPE because of its inclusive and multidisciplinary research and its engagement with real-world situations. However, its normative agenda and its motivation to judge rather than explain can be tricky in researching illicit activities. I argue that Constructivist IPE is the most suitable school because of its dynamism and concepts, namely meaning, cognition, uncertainty, and subjectivity. Utilizing these four concepts, researchers can conduct more detailed and more fruitful analyses regarding illicit financial activities. Showing why the Constructivist IPE is the most suitable school of IPE to research with a case study on tax havens’ status after 9/11, I assert that there should be more research in illicit financial activities in the IPE studies.

References

  • Abadie, A., & Gardeazabal, J. (2008). Terrorism and the world economy. European Economic Review, 52(1), 1-27.
  • Abdelal, R., Blyth, M., & Parsons, C. (Eds.). (2010). Constructing the international economy. Cornell University Press.
  • Abuza, Z. (2003). Funding terrorism in Southeast Asia: the financial network of Al Qaeda and Jemaah Islamiya. Contemporary Southeast Asia, 25(2), 169-199.
  • Al, A. (2015). Politika-ekonomi kesişmesi: yeni bir bilim dalı olarak uluslararası politik ekonomi. İstanbul Gelişim Üniversitesi Sosyal Bilimler Dergisi, 2(1), 143-159.
  • Belelieu, A. (2002). The G8 and terrorism: What role can the G8 play in the 21st century. G8 Governance, 8, 1-35.
  • Berry, C. (2020). The Sick Man of IPE: the British School. In The Routledge Handbook to Global Political Economy (pp. 29-42). Routledge.
  • Biersteker, T. J., & Eckert, S. E. (Eds.). (2007). Countering the financing of terrorism. Routledge.
  • Bindner, L. (2016). Illicit trade and terrorism financing. Centre d’Analyse du Terrorisme (CAT).
  • Bowers, C.B. (2008). Hawala, money laundering, and terrorism finance: Mirco-lending as an end to illicit remittance. Denv. J. Int’l L. & Pol’y, 37, 379.
  • Clunan, A.L. (2006). The fight against terrorist financing. Political Science Quarterly, 121(4), 569-596.
  • Cohen, B.J. (2014). Advanced Introduction to International Political Economy. Edward Elgar Publishing.
  • Dean, A., Thompson, E., & Keatinge, T. (2013). Draining the ocean to catch one type of fish: Evaluating the effectiveness of the global counter-terrorism financing regime. Perspectives on Terrorism, 7(4), 62-78.
  • Deciancio, M., & Quiliconi, C. (2020). Widening the ‘Global Conversation’: Highlighting the voices of IPE in the Global South. All Azimuth: A Journal of Foreign Policy and Peace, 9(2), 249-266.
  • Desai, M. A., Foley, C. F., & Hines, J. R. (2006). The demand for tax haven operations. Journal of Public economics, 90(3), 513-531.
  • Dishman, C. (2001). Terrorism, crime, and transformation. Studies in Conflict and Terrorism, 24(1), 43-58.
  • Donohue, L. (2006). Anti-terrorist finance in the United Kingdom and United States. Michigan Journal of International Law, 27, 303-435.
  • Ehrenfeld, R. (2002). Funding Terrorism: sources and methods. In Workshop held at Los Alamos National Laboratory March (Vol. 25, No. 29).
  • Ehrenfeld, R. (2005). Funding Evil: How Terrorism is Financed--and how to Stop it. Bonus Books, Inc.
  • Farrell, H., & Finnemore, M. (2009). Ontology, methodology, and causation in the American school of international political economy. Review of International Political Economy, 16(1), 58-71.
  • FBI. (2016). Terrorism. Retrieved from. https://www.fbi.gov/investigate/terrorism Access: 10/02/21
  • Fitzgerald, V. (2004). Global financial information, compliance incentives and terrorist funding. European Journal of Political Economy, 20(2), 387-401.
  • Freeman, M. (2011). The sources of terrorist financing: theory and typology. Studies in Conflict & Terrorism, 34(6), 461-475.
  • Freeman, M., & Ruehsen, M. (2013). Terrorism financing methods: An overview. Perspectives on Terrorism, 7(4), 5-26.
  • Germain, R.D. (2009). The ‘American’school of IPE? A dissenting view. Review of International Political Economy, 16(1), 95-105.
  • Giraldo, J., Trinkunas, H., & Zellen, B. (2005). Terrorism Financing and State Responses in Comparative Perspective. Center for Contemporary Conflict (ed.),(Monterey, 2004), 174.
  • Hampton, M.P., & Christensen, J. (2002). Offshore pariahs? Small island economies, tax havens, and the re-configuration of global finance. World Development, 30(9), 1657-1673.
  • Hardouin, P. (2009). Banks governance and public-private partnership in preventing and confronting organized crime, corruption and terrorism financing. Journal of Financial Crime, 16(3), 199-209.
  • Hira, A., Murata, B., & Monson, S. (2019). Regulatory mayhem in offshore finance: What the Panama papers reveal. In The Failure of Financial Regulation (pp. 191-232). Palgrave Macmillan, Cham.
  • Hobson, J.M. (2019). What’s at Stake in Doing (Critical) IR/IPE Historiography? The Imperative of Critical Historiography. In Historiographical Investigations in International Relations (pp. 149-169). Palgrave Macmillan, Cham.
  • IMF (2016). Anti-money laundering/combating the financing of terrorism- topics. Retrieved from. https://www.imf.org/external/np/leg/amlcft/eng/aml1.htm Access: 10/02/21
  • Jamwal, N. S. (2002). Hawala‐the invisible financing system of terrorism. Strategic Analysis, 26(2), 181-198.
  • Johnson, J. (2002). 11th September and revelations from the Enron collapse add to the mounting pressure on offshore financial centres. Journal of Financial Regulation and Compliance, 10(4), 341-354.
  • Jost, P.M., & Sandhu, H.S. (2003). The hawala alternative remittance system and its role in money laundering. Interpol.
  • Levitt, M.A. (2002). The political economy of Middle East terrorism. Middle East Review of International Affairs, 6(4), 49-65.
  • Li, Q., & Schaub, D. (2004). Economic globalization and transnational terrorism a pooled time-series analysis. Journal of Conflict Resolution, 48(2), 230-258.
  • Maliniak, D., & Tierney, M.J. (2009). The American school of IPE. Review of International Political Economy, 16(1), 6-33.
  • Masciandaro, D., & Portolano, A. (2003). It takes two to Tango: International financial regulation and offshore centres. Journal of Money Laundering Control, 6(4), 311-330.
  • McCulloch, J., & Pickering, S. (2005). Suppressing the financing of terrorism proliferating state crime, eroding censure and extending neo-colonialism. British Journal of Criminology, 45(4), 470-486.
  • Gallant, M.M. (2007). Tax and terrorism: a new partnership?. Journal of Financial Crime, 14(4), 453-459.
  • Napoleoni, L. (2007). Terrorism financing in Europe. Journal of Middle Eastern Geopolitics, 1(2), 171-184.
  • OECD (2019), Money Laundering and Terrorist Financing Awareness Handbook for Tax Examiners and Tax Auditors, OECD, Paris. Retrieved from www.oecd.org/tax/crime/money-laundering-and-terrorist-financing-awareness-handbook-for-tax-examiners-and-taxauditors.pdf Access: 07/07/21
  • Raphaeli, N. (2003). Financing of terrorism: sources, methods, and channels. Terrorism and Political Violence, 15(4), 59-82.
  • Roth, M.P., & Sever, M. (2007). The Kurdish Workers Party (PKK) as criminal syndicate: Funding terrorism through organized crime, a case study. Studies in Conflict & Terrorism, 30(10), 901-920.
  • Rudner, M. (2006). Using financial intelligence against the funding of terrorism. International Journal of Intelligence and CounterIntelligence, 19(1), 32-58.
  • Rudner, M. (2010). Hizbullah terrorism finance: Fund-raising and money-laundering. Studies in Conflict & Terrorism, 33(8), 700-715.
  • Seabrooke, L., & Young, K.L. (2017). The networks and niches of international political economy. Review of International Political Economy, 24(2), 288-331.
  • Shaxson, N. (2011). Explainer: what is a tax haven?. The Guardian. Retrieved from. https://www.theguardian.com/business/2011/jan/09/explainer-what-is-tax-haven Access: 10/02/21
  • Shelley, L. (2004). Unholy trinity: transnational crime, corruption, and terrorism. Brown J. World Aff., 11, 101.
  • Sorel, J.M. (2003). Some questions about the definition of terrorism and the fight against its financing. European Journal of International Law, 14(2), 365-378.
  • Stein, A. & Foley, M. (2016). The YPG-PKK Connection. Retrieved from http://www.atlanticcouncil.org/blogs/menasource/the-ypg-pkk-connection Access: 10/02/21
  • Thies, C.G., & Wehner, L.E. (2019). The role of role theory in international political economy. Cambridge Review of International Affairs, 32(6), 712-733.
  • Unger, B. (2017). Offshore activities and money laundering: recent findings and challenges. Policy Department A: Economic and Scientific Policy, European Parliament.
  • Van Fossen, A.B. (2003). Money laundering, global financial instability, and tax havens in the Pacific Islands. The Contemporary Pacific, 15(2), 237-275.
  • Veseth, M. (2002). What is international political economy. Retrieved from http://eolss.net/Sample-Chapters/C14/E1-35-02.pdf Access: 07/07/21
  • Walzenbach, G. (2016). Global political economy. Retrieved from https://www.e-ir.info/2016/12/29/global-political-economy/ Access: 07/07/21
  • Wang, Q.K., & Blyth, M. (2013). Constructivism and the study of international political economy in China. Review of International Political Economy, 20(6), 1276-1299.
  • Winer, J.M., & Roule, T.J. (2002). Fighting terrorist finance. Survival, 44(3), 87-104.

Catastrophic Beasts and How to Study Them: Researching Illicit Financial Activities in International Political Economy

Year 2021, Volume: 5 Issue: 2, 215 - 240, 20.12.2021
https://doi.org/10.33399/biibfad.879116

Abstract

Uluslararası Politik Ekonomi (IPE) çalışmalarında yasadışı finansal faaliyetlere nispeten daha az ilgi vardır ve bu yasa dışı faaliyetlerin nasıl inceleneceği oldukça belirsizdir. Amerikan ekolünün materyalist doğası ve devlet merkezli yaklaşımı bu yasa dışı faaliyetlerin temel özelliklerini/ilişkilerini gözden kaçırmaktadır. Öte yandan İngiliz okulu, kapsayıcı olması, multidisipliner yönü ve dünya üzerindeki sorunları konu edinmesi nedeniyle Amerikan ekolünden daha uygundur. Bununla birlikte, normatif gündemi ve açıklamaktan ziyade yargılama motivasyonu sebebiyle, yasa dışı faaliyetlerin araştırılması hususunda yanıltıcı olabilmektedir. Bu makalede, Konstrüktivist ekolün dinamik olması ve temel dört kavramı sebebiyle yasa dışı finansal faaliyetleri araştırma konusunda en uygun ekol olduğu savunulmaktadır. Bu ekolden yararlanan araştırmacıların bu dört kavramı kullanarak yasa dışı finansal faaliyetlerle ilgili daha detaylı ve daha verimli analizler yapabileceği öne sürülmektedir. Konstrüktivist ekolün bu tarz faaliyetlerin incelenmesinde neden daha başarılı olduğu 11 Eylül’den sonra vergi cennetlerinin statüsüne ilişkin bir vaka çalışması ile ispatlanmış ve Uluslararası Politik Ekonomi çalışmalarının yasadışı finansal faaliyetlere daha çok odaklanmasının gerekliliği belirtilmiştir.

References

  • Abadie, A., & Gardeazabal, J. (2008). Terrorism and the world economy. European Economic Review, 52(1), 1-27.
  • Abdelal, R., Blyth, M., & Parsons, C. (Eds.). (2010). Constructing the international economy. Cornell University Press.
  • Abuza, Z. (2003). Funding terrorism in Southeast Asia: the financial network of Al Qaeda and Jemaah Islamiya. Contemporary Southeast Asia, 25(2), 169-199.
  • Al, A. (2015). Politika-ekonomi kesişmesi: yeni bir bilim dalı olarak uluslararası politik ekonomi. İstanbul Gelişim Üniversitesi Sosyal Bilimler Dergisi, 2(1), 143-159.
  • Belelieu, A. (2002). The G8 and terrorism: What role can the G8 play in the 21st century. G8 Governance, 8, 1-35.
  • Berry, C. (2020). The Sick Man of IPE: the British School. In The Routledge Handbook to Global Political Economy (pp. 29-42). Routledge.
  • Biersteker, T. J., & Eckert, S. E. (Eds.). (2007). Countering the financing of terrorism. Routledge.
  • Bindner, L. (2016). Illicit trade and terrorism financing. Centre d’Analyse du Terrorisme (CAT).
  • Bowers, C.B. (2008). Hawala, money laundering, and terrorism finance: Mirco-lending as an end to illicit remittance. Denv. J. Int’l L. & Pol’y, 37, 379.
  • Clunan, A.L. (2006). The fight against terrorist financing. Political Science Quarterly, 121(4), 569-596.
  • Cohen, B.J. (2014). Advanced Introduction to International Political Economy. Edward Elgar Publishing.
  • Dean, A., Thompson, E., & Keatinge, T. (2013). Draining the ocean to catch one type of fish: Evaluating the effectiveness of the global counter-terrorism financing regime. Perspectives on Terrorism, 7(4), 62-78.
  • Deciancio, M., & Quiliconi, C. (2020). Widening the ‘Global Conversation’: Highlighting the voices of IPE in the Global South. All Azimuth: A Journal of Foreign Policy and Peace, 9(2), 249-266.
  • Desai, M. A., Foley, C. F., & Hines, J. R. (2006). The demand for tax haven operations. Journal of Public economics, 90(3), 513-531.
  • Dishman, C. (2001). Terrorism, crime, and transformation. Studies in Conflict and Terrorism, 24(1), 43-58.
  • Donohue, L. (2006). Anti-terrorist finance in the United Kingdom and United States. Michigan Journal of International Law, 27, 303-435.
  • Ehrenfeld, R. (2002). Funding Terrorism: sources and methods. In Workshop held at Los Alamos National Laboratory March (Vol. 25, No. 29).
  • Ehrenfeld, R. (2005). Funding Evil: How Terrorism is Financed--and how to Stop it. Bonus Books, Inc.
  • Farrell, H., & Finnemore, M. (2009). Ontology, methodology, and causation in the American school of international political economy. Review of International Political Economy, 16(1), 58-71.
  • FBI. (2016). Terrorism. Retrieved from. https://www.fbi.gov/investigate/terrorism Access: 10/02/21
  • Fitzgerald, V. (2004). Global financial information, compliance incentives and terrorist funding. European Journal of Political Economy, 20(2), 387-401.
  • Freeman, M. (2011). The sources of terrorist financing: theory and typology. Studies in Conflict & Terrorism, 34(6), 461-475.
  • Freeman, M., & Ruehsen, M. (2013). Terrorism financing methods: An overview. Perspectives on Terrorism, 7(4), 5-26.
  • Germain, R.D. (2009). The ‘American’school of IPE? A dissenting view. Review of International Political Economy, 16(1), 95-105.
  • Giraldo, J., Trinkunas, H., & Zellen, B. (2005). Terrorism Financing and State Responses in Comparative Perspective. Center for Contemporary Conflict (ed.),(Monterey, 2004), 174.
  • Hampton, M.P., & Christensen, J. (2002). Offshore pariahs? Small island economies, tax havens, and the re-configuration of global finance. World Development, 30(9), 1657-1673.
  • Hardouin, P. (2009). Banks governance and public-private partnership in preventing and confronting organized crime, corruption and terrorism financing. Journal of Financial Crime, 16(3), 199-209.
  • Hira, A., Murata, B., & Monson, S. (2019). Regulatory mayhem in offshore finance: What the Panama papers reveal. In The Failure of Financial Regulation (pp. 191-232). Palgrave Macmillan, Cham.
  • Hobson, J.M. (2019). What’s at Stake in Doing (Critical) IR/IPE Historiography? The Imperative of Critical Historiography. In Historiographical Investigations in International Relations (pp. 149-169). Palgrave Macmillan, Cham.
  • IMF (2016). Anti-money laundering/combating the financing of terrorism- topics. Retrieved from. https://www.imf.org/external/np/leg/amlcft/eng/aml1.htm Access: 10/02/21
  • Jamwal, N. S. (2002). Hawala‐the invisible financing system of terrorism. Strategic Analysis, 26(2), 181-198.
  • Johnson, J. (2002). 11th September and revelations from the Enron collapse add to the mounting pressure on offshore financial centres. Journal of Financial Regulation and Compliance, 10(4), 341-354.
  • Jost, P.M., & Sandhu, H.S. (2003). The hawala alternative remittance system and its role in money laundering. Interpol.
  • Levitt, M.A. (2002). The political economy of Middle East terrorism. Middle East Review of International Affairs, 6(4), 49-65.
  • Li, Q., & Schaub, D. (2004). Economic globalization and transnational terrorism a pooled time-series analysis. Journal of Conflict Resolution, 48(2), 230-258.
  • Maliniak, D., & Tierney, M.J. (2009). The American school of IPE. Review of International Political Economy, 16(1), 6-33.
  • Masciandaro, D., & Portolano, A. (2003). It takes two to Tango: International financial regulation and offshore centres. Journal of Money Laundering Control, 6(4), 311-330.
  • McCulloch, J., & Pickering, S. (2005). Suppressing the financing of terrorism proliferating state crime, eroding censure and extending neo-colonialism. British Journal of Criminology, 45(4), 470-486.
  • Gallant, M.M. (2007). Tax and terrorism: a new partnership?. Journal of Financial Crime, 14(4), 453-459.
  • Napoleoni, L. (2007). Terrorism financing in Europe. Journal of Middle Eastern Geopolitics, 1(2), 171-184.
  • OECD (2019), Money Laundering and Terrorist Financing Awareness Handbook for Tax Examiners and Tax Auditors, OECD, Paris. Retrieved from www.oecd.org/tax/crime/money-laundering-and-terrorist-financing-awareness-handbook-for-tax-examiners-and-taxauditors.pdf Access: 07/07/21
  • Raphaeli, N. (2003). Financing of terrorism: sources, methods, and channels. Terrorism and Political Violence, 15(4), 59-82.
  • Roth, M.P., & Sever, M. (2007). The Kurdish Workers Party (PKK) as criminal syndicate: Funding terrorism through organized crime, a case study. Studies in Conflict & Terrorism, 30(10), 901-920.
  • Rudner, M. (2006). Using financial intelligence against the funding of terrorism. International Journal of Intelligence and CounterIntelligence, 19(1), 32-58.
  • Rudner, M. (2010). Hizbullah terrorism finance: Fund-raising and money-laundering. Studies in Conflict & Terrorism, 33(8), 700-715.
  • Seabrooke, L., & Young, K.L. (2017). The networks and niches of international political economy. Review of International Political Economy, 24(2), 288-331.
  • Shaxson, N. (2011). Explainer: what is a tax haven?. The Guardian. Retrieved from. https://www.theguardian.com/business/2011/jan/09/explainer-what-is-tax-haven Access: 10/02/21
  • Shelley, L. (2004). Unholy trinity: transnational crime, corruption, and terrorism. Brown J. World Aff., 11, 101.
  • Sorel, J.M. (2003). Some questions about the definition of terrorism and the fight against its financing. European Journal of International Law, 14(2), 365-378.
  • Stein, A. & Foley, M. (2016). The YPG-PKK Connection. Retrieved from http://www.atlanticcouncil.org/blogs/menasource/the-ypg-pkk-connection Access: 10/02/21
  • Thies, C.G., & Wehner, L.E. (2019). The role of role theory in international political economy. Cambridge Review of International Affairs, 32(6), 712-733.
  • Unger, B. (2017). Offshore activities and money laundering: recent findings and challenges. Policy Department A: Economic and Scientific Policy, European Parliament.
  • Van Fossen, A.B. (2003). Money laundering, global financial instability, and tax havens in the Pacific Islands. The Contemporary Pacific, 15(2), 237-275.
  • Veseth, M. (2002). What is international political economy. Retrieved from http://eolss.net/Sample-Chapters/C14/E1-35-02.pdf Access: 07/07/21
  • Walzenbach, G. (2016). Global political economy. Retrieved from https://www.e-ir.info/2016/12/29/global-political-economy/ Access: 07/07/21
  • Wang, Q.K., & Blyth, M. (2013). Constructivism and the study of international political economy in China. Review of International Political Economy, 20(6), 1276-1299.
  • Winer, J.M., & Roule, T.J. (2002). Fighting terrorist finance. Survival, 44(3), 87-104.
There are 57 citations in total.

Details

Primary Language English
Journal Section Makaleler
Authors

Ahmet Ateş 0000-0001-5184-7701

Publication Date December 20, 2021
Submission Date February 12, 2021
Published in Issue Year 2021 Volume: 5 Issue: 2

Cite

APA Ateş, A. (2021). Catastrophic Beasts and How to Study Them: Researching Illicit Financial Activities in International Political Economy. Bingöl Üniversitesi İktisadi Ve İdari Bilimler Fakültesi Dergisi, 5(2), 215-240. https://doi.org/10.33399/biibfad.879116


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