Arvid Lukauskas is the executive director of the Picker Center for Executive Education and the MPA in Economic Policy Management (MPA-EPM) program at the School of International and Public Affairs, Columbia University.  He also directs SIPA’s summer program offered in collaboration with the School of Continuing Education.

Lukauskas teaches and conducts research on international and comparative political economy, with a focus on the political economy of finance and trade policy.  His books are the Handbook of Trade Policy for Development, edited with R. Stern and G. Zanini (Oxford University Press, 2013); The Political Economy of the East Asian Crisis and its Aftermath, edited with F. Rivera-Batíz (Edward Elgar 2001); and Regulating Finance: The Political Economy of Spanish Financial Policy from Franco to Democracy (University of Michigan 1997).  His articles have appeared in various scholarly journals, including Comparative Politics, Comparative Political Studies, International Studies Quarterly, Japanese Journal of Political Science and Review of International Political Economy.  He is currently working on a book-length project examining the links between economic and social development in East Asia.

Through the Picker Center, Lukauskas has helped develop or direct a number of major executive training programs in Brazil, Chile, China, Egypt, Republic of Georgia, Hong Kong, Malaysia, Mexico, Singapore, and Thailand as well as for UNDP and the World Bank.  He was the principal investigator for a four-year USAID grant, in conjunction with the East-West Management Institute, to develop educational capacity in the Republic of Georgia.  He has served as a consultant to UNDP and the World Bank Institute.

Lukauskas received a BA from University of Wisconsin, Madison, an MPA from University of Oklahoma, and his PhD from University of Pennsylvania.

Research & Publications

July 2013|Handbook of Trade Policy for Development|Arvid Lukauskas, edited with R. Stern and G. Zanini

Handbook of Trade Policy for Development

There are many textbooks devoted to international trade but few volumes that survey trade theory, policy, and negotiations in a concise, up-to-date manner from an interdisciplinary perspective. This book provides a comprehensive overview of the issues that dominate both academic discourse and the policymaking arena in the field of international trade, bringing to bear the insights of economics, law, and political science. It also stands out by virtue of its emphasis on the development implications of trade, an increasingly useful perspective given the deepening liberalization of developing and emerging market economies and their growing importance in the world economy.  The volume examines the full range of trade policy topics that dominate contemporary debates, such as rules of origin, trade in services, competition, public procurement, and trade facilitation, plus emergent controversial topics like trade-related labour standards and environmental issues. It analyses the international trade architecture and the institutional and practical aspects of policymaking and negotiations at the unilateral, multilateral, and regional level, as well as the effects of trade on economic growth, inequality, and poverty. It also explores the sharp increase in the number of preferential trade agreements and their significance for the global trade system. The treatment of each issue is rigorous, yet highly accessible to anyone with a basic background in economics, law, and international political economy.

October 2006|Japanese Journal of Political Science|Arvid Lukauskas, Yumiko Shimabukuro

In 1997, the Japanese Diet revised the Bank of Japan law thereby granting the central bank greater independence in monetary policy making. The revision was an attempt by Japan's political class to weaken the authority of the powerful Ministry of Finance over the central bank and augment its own influence. The Bank of Japan, however, gained more autonomy than politicians ever intended, leading to frequent confrontations between the government and the central bank over monetary policy. This paper explores the new strategic relationship that emerged between the Bank of Japan and government and the nature of monetary policy implemented in the post-reform period. We demonstrate that several factors contributed to the Bank's unexpected ability to enhance its independence: the astute leadership of the first post-reform governor Hayami Masaru; the Bank's ability to turn politicization of monetary policy to its advantage; and its pursuit of a ‘power through knowledge’ strategy achieved by augmenting its own research capacity. On a theoretical level, our findings show that the passage of a new legal framework only marks the completion of one stage of institutional change and the start of the next; post-enactment politics have as much importance as pre-enactment politics in shaping outcomes. In the post-enactment phase, various factors, including the state of the economy and informal institutions or processes, matter greatly and may shift the direction of institutional change away from the intended path.

October 2002|Comparative Political Studies|Arvid Lukauskas

Recent financial crises in Asia have renewed debates over the appropriate degree and scope of government intervention in financial markets. Governments in two countries affected by financial crises, Japan and South Korea, have historically implemented extensive controls over the financial system. Here, the author asks: What motivated government officials in these countries to implement financial restriction and to keep it so long? Why did Japan and South Korea apparently succeed unlike other countries? It is argued that East Asian officials designed financial policy in part to appease powerful social groups, like banks and industry, and to advance their own political goals. Their intervention produced better results than elsewhere because political and security imperatives to promote rapid industrialization and growth restricted the degree of inefficiency introduced into financial regulation. This study's findings thus highlight the importance of a nation's political institutions and security context in shaping incentives facing public officials.

October 2001|Edward Elgar Publishers|Arvid Lukauskas, Francisco L. Rivera-Batiz

The East Asian crisis has sparked debate regarding the future of emerging markets and the globalization of world capital markets. This study, with contributions by leading economists and political scientists, provides an assessment of the causes and consequences of the crisis and the policy lessons drawn from it. In contrast to much of the existing literature, the volume presents the view that the crisis and its aftermath were not simply the result of purely economic and financial phenomena but also the reflection of some fundamental institutional, historical and political forces. The collection begins with a comparative and historical analysis of the crisis, placing it in the context of other financial and debt crises. This is followed by a discussion of the domestic political and economic factors behind the events, delineating the differences and similarities among affected countries. The contributors also examine how global political forces influenced the unfolding crisis in various countries. Using data, experts present the economic situation in East Asia, the contagion effects in the rest of the world, and the role played by international institutions such as the IMF. Finally, the volume provides a roundtable debate on the policy alternatives confronting emerging markets and the world monetary system in the aftermath of the crisis.

October 2000|International Studies Quarterly|Arvid Lukauskas, S. Minushkin

This study examines financial opening in middle-income countries and identifies the variables that shape its basic features. We find that the widely noted increase in international capital mobility has not constrained financial policy-making equally across states. A country’s economic conditions and need for external funds determine its government’s bargaining power vis-à-vis international actors and domestic groups with respect to financial policy. Governments with low bargaining power, because domestic economic conditions are poor or need for external funds is high, must open financial markets completely to attract or retain capital. Conversely, governments with high bargaining power may be able to retain some controls on capital flows or deny foreign banks access to domestic markets and still have access to capital.

To explore these issues, this article looks at opening in Chile, Mexico, South Korea, and Turkey. These countries opened their financial systems in very different ways. Turkey and Mexico liberalized their markets almost completely, whereas Korea ~1980–98! kept barriers to capital entry and Chile ~1991–98! retained barriers to capital exit. Although economic conditions explain the basic style of financial opening, they cannot account for the residual barriers that persist in mostly open markets or the pace and timing of reforms. Domestic political factors, particularly, the interests of leaders and key social groups as well as their relative bargaining power, help to explain these variables. The paper develops a typology of styles of financial opening to encourage systematic thinking about the origins and consequences of differences in style.

October 1999|Review of International Political Economy|Arvid Lukauskas

Managing Mobile Capital

October 1998|University of Michigan Press |Arvid Lukauskas

In recent years many countries have liberalized their financial markets as a central element of their efforts to reform their economies and increase their economic growth rates. Financial deregulation leads to a fundamental restructuring of a country's economy and polity, as market forces, not state officials, begin to determine who obtains financial resources and at what cost. A critical question is whether countries can undertake a program of liberalization while undergoing democratic transformation. In this study, Arvid John Lukauskas explores why governments tightly regulate their country's financial system and why they choose to liberalize it.

Using a rational choice approach, Lukauskas contends that public officials provide the dynamic behind the evolution of financial regulation as they seek to retain power and generate public revenue. Lukauskas argues that the nature of a country's political institutions shape the incentives facing politicians and influence whether they seek to regulate closely or liberalize financial markets in the pursuit of their goals. Lukauskas then tests his ideas in an in-depth case study of the evolution of financial policy in Spain, a country that transformed its financial system into a mostly market-based system after years of heavy state intervention, while undergoing a transformation from a dictatorship to a democracy. Contrary to the conventional wisdom that leaders will not undertake structural change during periods of democratization, he finds that leaders in Spain undertook financial liberalization despite opposition from powerful groups, because democratization gave Spanish leaders a strong incentive to improve economic performance through financial reform in order to compete for votes.

 

This book will be of interest to political scientists and economists interested in studying financial markets and the effects of regime change, including democratization, on economic reform.

October 1992|Comparative Politics|Arvid Lukauskas

In a restricted financial system, the government attempts to control the allocation of credit and obtain revenue by fixing interest rates, implementing selective credit policies, blocking the development of direct financial markets, and heavily taxing the banking system. This dissertation asks three major questions: What are the political and economic foundations of restricted financial systems? Which political and economic factors lead to financial deregulation in restricted systems and determine its timing? Which actors drive the process of deregulation? To examine these issues, the dissertation looks at the foundations of Spain's restricted financial system in the period 1940-1974 and its intense process of deregulation from 1974 onwards. The case study is based on in-depth interviews with financial policy makers and financiers as well as a thorough examination of primary and secondary sources.

I argue that political factors best explain the existence of restricted financial systems. Politicians, with the consent of banks and well-connected firms, attempt to establish financial restriction to pursue political goals. A restricted system helps politicians to retain power, by creating a means of delivering patronage, and to raise revenue, by enabling them to tax the banking sector indirectly. I contend that public officials initiate the movement for deregulation in restricted financial systems. Changes in the political environment or institutions may provide politicians with an incentive to pursue the greater financial efficiency deregulation produces. In Spain, a transition from an authoritarian to a democratic regime was the key factor driving change in financial policy. A transition to democracy gave politicians an incentive to place less emphasis on providing particularistic benefits through the financial system and more on promoting financial efficiency, and led them to adopt more effective means of raising revenue. The Spanish experience with deregulation differs from that of states with non-restricted financial systems. In these systems, regulated financial entities promote deregulation in an effort to cope with unregulated competitors. In Spain, the financial status quo did not challenge the regulatory regime because these market pressures were absent.