Public-finance

There are two schools of thought about the crises of the late 1990s. One school -- call it the Markets-Don't-Err school -- blames poor economic management in the stricken countries. In this view, investors lost confidence in emerging markets after government deficits put downward pressure on exchange rates and poor banking practices led to corporate overindebtedness. The second school -- call it the Markets-as-Herd school -- blames the dynamics of international capital itself. Investors, having recklessly plowed money into emerging markets in the early 1990s, got cold feet when Thailand's currency collapsed in 1997. They then stampeded to liquidate their positions in other emerging-market currencies, punishing countries willy-nilly regardless of their underlying economic fundamentals.

It's a measure of the book's success that members of both schools can find evidence to support their position. My only complaint -- not serious enough to give the book less than 5 stars -- is the patchy quality of the narrative. Malaysia is barely mentioned at all, for example. I suspect this is because sections of the book were recycled from Washington Post articles.

Although filled with intriguing ideas, the value of
Jacobsen's work is seriously handicapped by flaws in its style and
presentation. In terms of organization, Jacobsen chose a
sufficiently legitimate option in separating his thesis in roughly
the following chapters: foundations of the theory of state policy
making; specific application of his chosen theories and
classifications to the Irish Republic case; historical background
of Irish political,social, and economic development; "power play"
and its effects on the Irish economy and citizenry; and a
depiction of the current state of affairs in the Republic.

However, Jacobsen's writing style leaves much to be desired
for two reasons. First, the work's readability is seriously
hampered by his improper use of verb tenses. This may seem a
trivial criticism, but his mistakes are so numerous and glaring,
that it is difficult to retain any grasp of chronology and time.
Consider the errors in the following paragraph:

"The EC Cohesion Funds will go to an employment creation fund... which will triple over time... The coalition partners agreed on mortage relief... Child payments are up and there is a pledge... The new government would establish..." (p. 200).
These sort of shifts in verb tense in a series of five sentences
are common throughout the work.

Second, and more generally, Jacobsen's writing is dry. The
few interesting terminologies and/or "catch phrases" are few and
far between, and often quotations from other pieces. Adding
to this dryness is his tendency to rely heavily on statistics within the
text. It is understood that a piece dealing with economic policy
necessitates the use of statistics, but paragraph upon paragraph
were literally listings of pertinent but overwhelming numbers.
This makes for tedious reading, and ultimately a frustrated
reader. This issue relates to another: the use of informational
aids.

Jacobsen does utilize data charts in his analysis to assist
in the understanding of policy factors and/or results. However,
this reader felt graphs and charts would have been highly useful
in the interpretation of economic, social, and political trends in
the Republic as well as the world. Since his thesis
is based on the coordination of such trends,
the benefits of making such statistics as clear as possible
are obvious.

These flaws are not enough, however, to conclude that this
piece has no value. Jacobsen's obseravtions are certainly
interesting, not to mention the thesis' value in terms of
uniqueness. This reader was surprised not only by the fact that
his treatment of Ireland is quite similar to those applied to
"non-Western" states, but also in his thesis alone:
"...international economic forces do not determine the precise
policy response of a given state or the definition of interest by
internal actors as to policy preferences" (p. 201). To say the
surprise was pleasant would be an understatement.

This work retains its overall worth due to its creative
perspective and insight, despite its noticeable flaws. These
flaws do pose problems as they could seriously limit the piece's
potential audience. However, in this reader's opinion, Jacobsen
did support his thesis sufficiently, and has broken new
ground in policy analysis and development theory, as "...the
problems cited here are manifested across the spectrum of regime
types, developmental levels, modes of intervention, and state-
society configuration" (p. 203). This piece is highly recommended
for those with the interest level to "smooth-out" its rougher
edges.