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Projects to enhance health security and child survival in Africa with improvements in water and sanitation, examine why poor business-management practices persist in India, study the relationship of legal courts to politics and human rights, and understand why the Middle East has lagged in economic progress were recent recipients of grants totaling just under $1 million from Stanford's Presidential Fund for Innovation in International Studies.

"These projects have great potential to advance academic knowledge, social capital and human development around the world, and to create a healthier, more promising future for hundreds of millions of people," President John Hennessy said. "When we launched The Stanford Challenge, we committed to marshal university resources to address the great challenges of the 21st century in human health, the environment and international affairs, and it is gratifying to see the response from our remarkable faculty."

The 2008 projects and their principal investigators follow:

Enhancing Health Security Through Infrastructure and Behavioral Intervention: Water, Sanitation and Child Survival in Africa. Alexandria Boehm and Jenna Davis, Civil and Environmental Engineering; Abby King, Health Research and Policy and Medicine; Gary Schoolnik, Medicine and Microbiology and Immunology. The project seeks to improve the health and well-being of the 1.2 billion people in low-income countries who lack access to clean water and the 2.6 billion who lack access to sanitation services, with a focus on mortality reduction in children. It will be carried out in sub-Saharan Africa, where the toll of water- and sanitation-related illness on health is severe, and will investigate the extent to which information and education about water and sanitation at the household level motivates behavior changes that result in reduced morbidity. Results will inform international efforts to design and implement effective water supply and sanitation interventions for more than 400 million Africans currently lacking access.

Why Are Indian Firms Poorly Managed? A Survey and Randomized Field Intervention. Nicholas Bloom and Aprajit Mahajan, Economics; Thomas C. Heller and Erik Jensen, Law School; John Roberts, Graduate School of Business. The biggest single reduction in poverty in the history of mankind was achieved by the industrialization of China since 1978, which lifted almost 500 million people out of poverty. India has not experienced this level of poverty reduction because its manufacturing firms have not achieved the productivity gains seen in China. Recent evidence suggests one key factor is the poor management practices adopted by Indian firms. This project examines why poor management practices persist in India and are much more common there. It focuses in particular on evaluating the relative importance of informational, legal and development barriers. The project will undertake a field survey of Indian firms to evaluate their knowledge of modern management techniques and a field intervention aimed at upgrading management practices in a randomized sample of Indian firms, comparing their progress to a control group of untouched firms.

Courts, Politics and Human Rights. Joshua Cohen, Philosophy, Political Science, and Law School; Terry L. Karl, Political Science; Jenny S. Martinez, Law School; Helen Stacy, Law School. This project examines the role of courts as the centerpiece of strategies for promoting human rights by asking if courts should be a preferred human rights venue or if there are other more accessible and effective ways to secure human rights. It addresses three broad themes: the interplay between national, regional and international courts in the protection of human rights; the role of governments and nongovernmental organizations in influencing legal proceedings; and how courts construct historical truth and shape public opinion, memory, attitudes and discourse about human-rights abuses. The multidisciplinary project will span countries, regions, issue areas and historical timeframes to ask what reasonably can be expected from international, regional and domestic courts in safeguarding human rights.

The Middle East and the World Economy. Matthew Harding, Economics; Lisa Blaydes, Political Science. This project examines why the Middle East has lagged in economic progress compared to much of the developing world and the implications of this underdevelopment for two overarching trends in Middle Eastern politics today: authoritarian government and Islamic fundamentalism. The researchers also will examine how political instability originating in the Middle East has affected world oil prices and world markets by constructing economic models of the world economy. The project seeks broadly to understand the macro- and microeconomic determinants of Islamic fundamentalism and authoritarian rule, and the extent to which these two outcomes have affected the stability and prosperity of the world economy. It measures global factors resulting from increased globalization and quantifies their impact on the development of economies in the Middle East.

The $3 million Presidential Fund for Innovation in International Studies was first established in 2005 by the Office of the President and the Stanford International Initiative to support new cross-campus, interdisciplinary research and teaching among Stanford's seven schools on three overarching global challenges: pursuing peace and security, reforming and improving governance at all levels of society, and advancing human well-being.

The first $1 million in interdisciplinary grants was awarded in February 2006; the second round of grants was awarded in February 2007.

"In all three rounds of funding, it has been heartening to see the imaginative and innovative ways that Stanford faculty are combining intellectual forces across disciplines to tackle some of the most pressing and persistent problems of our day," said Coit D. Blacker, chair of the International Initiative Executive Committee and director of Stanford's Freeman Spogli Institute for International Studies. "It is especially gratifying to see the younger faculty competing for these grants, eager to generate new knowledge and new solutions and help train a new generation of leaders."

Priority in funding has been given to teams of faculty who do not typically work together, who represent multiple disciplines and who address issues falling broadly within the three central research areas of the Stanford International Initiative. Projects are to be based on collaborative research and teaching involving faculty from two or more disciplines and, where possible, from two or more of the university's seven schools.

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David G. Victor
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David G. Victor is a professor at Stanford Law School and directs the Freeman Spogli Institute's Program on Energy & Sustainable Development; he is also adjunct senior fellow at the Council on Foreign Relations.

Democrats voting in Ohio and Texas may well decide the shape of the U.S. presidential election. Regardless of who they choose to run against Sen. John McCain, the all but certain Republican candidate, it is likely that energy issues will figure more prominently in the election than at any time in the last generation. High prices are sapping economic growth, the No. 1 concern across most of the country. Gasoline is now approaching $4 a gallon; natural gas and electricity are also more costly than a few years ago. Global warming has become a bipartisan worry, and solving that problem will require radical new energy technologies as well. All this is good news in the rest of the world, which is hoping that a new regime in Washington will put the United States on a more sustainable energy path.

It may be a vain hope. It is extremely unlikely that Washington will ever supply a coherent energy policy, regardless of who takes the White House in November. That's because serious policies to change energy patterns require a broad effort across many disconnected government agencies and political groups. Higher energy efficiency for buildings and appliances, a major energy use area, requires new federal and state standards. Higher efficiency for vehicles requires federal mandates that always meet stiff opposition in Detroit. A more aggressive program to replace oil with biofuels requires policy decisions that affect farmers and crop patterns-yet another part of Washington's policymaking apparatus, with its own political geometry. New power plants that generate electricity without high emissions of warming gases require reliable subsidies from both federal and state governments, because such plants are much more costly than conventional power sources. Approvals for these new plants require favorable decisions by state regulators, most of whom are not yet focused on the task. Expanded use of nuclear power requires support from still another constellation of administrators and political interests. And so on.

Whenever the public seizes on energy issues, the cabal of Washington energy experts imagines that these problems can be solved with a new comprehensive energy strategy, backed by a grand new political coalition. Security hawks would welcome reduced dependence on volatile oil suppliers, especially in the Persian Gulf. Greens would favor a lighter tread on the planet, and labor would seize on the possibility for "green-collar" jobs in the new energy industries. Farmers would win because they could serve the energy markets. The energy experts dream of a coalition so powerful that it could rewire government and align policy incentives.

This coalition, alas, never lasts long enough to accomplish much. For an energy policy to be effective, it must send credible signals to encourage investment in new equipment not just for the few months needed to craft legislation but for at least two decades-enough time for industry to build and install a new generation of cars, appliances and power plants, and make back the investment. The coalition, though, is politically too diverse to survive the kumbaya moment.

Just two weeks ago the feds canceled "FutureGen," a government-industry project to develop technologies for burning coal without emitting copious greenhouse gases, demonstrating that the government is incapable of making a credible promise to help industry develop these badly needed technologies over the long haul. (The project had severe design flaws, but what matters most is that the federal government was able to pretend to support the venture for as long as it did and then abruptly back off.) Similarly, legislation late last year to increase the fuel economy of U.S. automobiles will have such a small effect on the vehicle fleet that it will barely change the country's dependence on imported oil and will have almost no impact on carbon emissions. Democrats and Republicans alike claim they want to end the country's dependence on foreign oil, but neither party actually does much about it.

The only policies that survive in this political vacuum are those that target narrower political interests with more staying power. Thus America has a highly credible policy to promote corn-based ethanol, because that policy really has nothing to do with energy; it is a chameleon that takes on whatever colors are needed to survive. It is a farm program that masquerades as energy policy; at times, it has been a farm program that masquerades as rural development. As an energy policy it is a very costly and ineffective way to cut dependence on oil. As a global warming policy it is even less cost effective, since large-scale ethanol doesn't help much in cutting CO2 and other warming gases. Similarly, the United States has a stiff subsidy for renewable electricity-mainly wind and solar plants-because environmentalists are well organized in their support for it. The coal industry periodically gets money for its favored technologies, as in FutureGen, but even that powerful lobby has a hard time getting the government to stay the course.

Europe is in danger of contracting the same affliction. To be sure, most European countries long ago started taxing energy as a convenient way to raise revenues, which fortuitously also makes energy more costly and creates a strong incentive for efficiency. That approach did not originate as an energy policy, but it has emerged as a keystone of Europe's more successful efforts to tame energy consumption. And Europe is in the midst of shifting policymaking from the individual countries to Brussels, which may create a more coherent approach. But despite these advantages, Europe is notable for its inability to be strategic. For example, Brussels is touting a new pipeline called Nabucco that would help Europe cut its dependence on Russia for its natural gas. So far, Brussels is good at talking about the Nabucco dream but can't agree on a route, financing, or even on where to get the gas that would replace Russia's.

The rising powers in Asia are also finding that they, like America, have a hard time developing and applying strategic energy policies. China develops energy policy through its economic planning system, with mixed results. The country doesn't even have an energy ministry, and efforts to create one are being stymied by the bureaucracy and companies that fear they will lose influence. India has four energy ministries and no real central strategy. Like America, India is very good at declaring visions for strategic energy policy but dreadful at putting them into practice. The Japanese public is just as fickle, but the government bureaucracy is entrenched and far-sighted enough to keep its focus long after public interest has waned.

All this means that the underlying forces that are causing high demand for energy (and high prices) and emitting greenhouse gases will be hard to alter. The effort to solve global warming might change this pessimistic iron rule of energy policy, because the environmental community that is the core of the coalition in support of global warming policy is becoming much stronger and has shown staying power. For the moment, however, that is a hypothesis to be proved.

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This paper develops empirical models for average oil production costs that represent the structural field-level and country-level determinants most characteristic for the new era beyond easy oil. These models lend themselves as a tool for forecasting the floor of structural cost trends related to the shift into more cost intensive fields that are increasingly producing heavy and extra-heavy crudes and that are located offshore and in countries fraught with high levels of political and environmental risks. Given the extremely limited availability of reliable, non-proprietary cost data, this model deliberately relies on high level factors for which data is publicly available for hundreds of fields from all oil producing states. This model specification offers the important advantage of enabling us to lever insights gained from this study in powerful out-of-sample estimations for the dominant scenario where data is available on field characteristics but not on costs.

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Program on Energy and Sustainable Development Working Paper #72
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North Korea has shut down its key nuclear facilities and is discussing how to retrain workers at the Yongbyon nuclear complex, CISAC Co-Director Siegfried S. Hecker said Feb. 20 following a five-day visit to the country.

"The disablement actions at the three key nuclear facilities--that is [the] fuel fabrication plant, the reactor, and the reprocessing plant--those disablement actions are just about complete at this point," Hecker told reporters during a press conference at Stanford. "In my judgment, they are very serious actions, and they will require serious time and effort to restart those facilities."

Hecker, a research professor of management science and engineering and senior fellow at the Freeman Spogli Institute for International Studies, visited scientists at Yongbyon and government officials in Pyongyang from Feb. 12 to 16. Joel Wit, a former U.S. State Department official, and Keith Luse, a staffer for Sen. Richard Lugar, R-Indiana, accompanied him during a private visit that also involved discussions on formalizing health and educational exchanges between the two nations. "All the way around, it was a very good visit, a very professional one on the DPRK's side," Hecker said, referring to the country's acronym for the Democratic People's Republic of Korea.

According to Hecker, "significant hurdles" remain before North Korea will offer a "complete declaration," or complete list of its nuclear program, both past and present. The North Koreans told Hecker that the process has been delayed because other parties in the six-party talks, which aim to find a peaceful resolution to the country's nuclear weapons program, have been slow in delivering compensation such as heavy fuel oil. Despite this, Hecker said, cooperation between the U.S. and North Korean technical teams was excellent during the visit.  "The DPRK wants these obligations [of the other member nations] to be met quickly so they can move on to the next stage, that's the stage of dismantlement," he said, referring to agreements reached Oct. 3, 2007, during talks to achieve a nuclear weapons-free Korean peninsula.

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David G. Victor: Although oil prices will eventually drop as new sources come online and biofuels and other alternatives take hold, crude price are likely to remain high and volatile for a while.
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We are pleased to bring you the third article of the academic year in our series of Shorenstein APARC Dispatches. This month's piece comes from Dr. Phillip Lipscy, FSI Center Fellow and Assistant Professor, Political Science. Lipscy joined Shorenstein APARC in fall 2007 and his research interests focus on international relations and political economy, particularly as they relate to Japan and East Asia. He has been a Shorenstein APARC affiliate since his undergraduate years, when he studied under Professor Emeritus Danial Okimoto. He attended Harvard University for his doctoral studies.

Since the end of World War II, East Asia has often been characterized as a region with weak international organizations. There has been no regional integration project comparable to the European Union (EU). Cooperation on a wide variety of issues has tended to be ad hoc rather than institutionalized. Regional organizations, such as the Association of Southeast Asian Nations (ASEAN), have generally been weak or limited in scope, with some notable exceptions such as the Asian Development Bank.

However, in recent years, there are indications that the pattern of institutionalization in Asia is shifting. Since the end of the Cold War, regional cooperative arrangements have emerged and grown. With the addition of China, Japan, and South Korea, a revitalized ASEAN+3 is becoming a locus of economic cooperation. Many observers believe the Six Party Talks could be institutionalized to manage a broader set of security issues beyond North Korea. The Chiang Mai Initiative, a multilateral currency swap arrangement, might eventually develop into a monetary fund. Bilateral trade agreements are proliferating and could ultimately produce a regional free trade zone.

Under the right circumstances, regionalism can complement the broader global order. However, to a significant extent, recent regional initiatives reflect an underlying dissatisfaction with the global institutional architecture. The Chiang Mai Initiative emerged after the Asian financial crisis, from a widespread sense that the International Monetary Fund (IMF) underrepresented Asian interests and therefore imposed overly harsh conditionality on the affected states. Paralysis at the Doha Round negotiations of the World Trade Organization (WTO) has facilitated the rapid expansion of bilateral trade initiatives. The North Korean nuclear problem is precisely the sort of collective security issue the United Nations (UN) Security Council was envisioned to deal with, but the rigidity of both Security Council membership and its decision-making procedures has rendered this impractical.

Historically, international organizations have often exhibited path dependence, or a resistance to change. For example, the permanent members of the UN Security Council still remain the victorious powers of World War II. The distribution of voting shares in the IMF and World Bank has consistently overrepresented inception members such as Canada, France, and the United Kingdom, at the expense of both the defeated powers of World War II and newly independent and developing states. The Organization for Economic Cooperation and Development (OECD) remains a predominantly European institution despite the rapid growth of Asia. Across a wide range of international organizations, Asian nationals continue to be underrepresented among employees, and in some cases leading positions are allocated to Western nationals by convention, as in the IMF and World Bank.

However, as Asia continues its rapid growth, the active involvement of Asian states in the global order will become paramount. Including India, broader East Asia encompasses more than half of the world's population. The region already accounts for about one-third of global oil consumption and CO2 emissions, and this is only likely to grow in the future. By 2020, in purchasing power parity terms, regional GDP will likely exceed that of the United States and the EU combined. Over the course of the twenty-first century, Asia's economic and geopolitical weight in the world will, in all likelihood, come to rival that of Europe in the nineteenth century. With Asia's dramatic rise, Asian problems will become increasingly indistinguishable from global problems.

Thus, a critical question in the coming decades will be whether the contemporary international organizational architecture will be able to smoothly incorporate the rising states of broader East Asia. Sweeping geopolitical shifts have often created instability in the international system -- the waning of Pax Britannica in the early twentieth century precipitated two world wars and a global depression, as the world lacked a geopolitical and economic stabilizing force in times of crisis. If universalistic institutions such as the UN, IMF, and WTO are seen as unresponsive to Asian concerns, two potentially destabilizing outcomes are likely. First, Asian regional cooperation may further intensify. For example, a full-fledged Asian Monetary Fund that acts independently of the IMF could be formed, or an Asian Free Trade Area established. Such institutions have the potential to undermine existing international organizations such as the IMF and WTO. Eventually, Asian institutions may supersede existing global institutions, but only after contestation and needless replication. A second destabilizing outcome could be that Asian states disengage from the U.S.-backed international order without developing strong regional institutions. This might create a situation akin to U.S. nonparticipation in the League of Nations in the interwar years. Without active involvement of some of the most important players, international organizations will become less effective at facilitating cooperation and resolving major disputes. International relations will become more anarchic and cooperation more ad hoc.

The rise of Asia will likely provide the first major stress test for the global organizational architecture that the United States has constructed and underpinned since the end of World War II. Of course, there are also some grounds for optimism. Among other things, China and Vietnam have joined the WTO, ongoing IMF quota revisions have produced ad hoc increases to South Korea and China, and Asian nationals increasingly play important roles in major international organizations -- e.g. UN Secretary General Ban Ki-moon and former UN High Commissioner for Refugees Sadako Ogata. It is paramount that concerns about Asian representation and interests in universalistic international organizations be addressed so that the rise of Asia contributes to -- rather than undermines -- the stability of the international order.

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