The Sovereignty of Nations

by V S Rama Rao on February 1, 2010

No company, domestic or international, large or small can conduct business without considering
the influence of the political environment within which it will operate. One of the most
undeniable and crucial realities of international business is that both host and home governments
are integral partners. A government reacts to its environment by initiating and pursuing policies
deemed necessary to solve the problems created by its particular circumstances. Reflected in its
policies and attitudes towards business are a governments ideas of how best to promote the
national interest, considering its own resources and political philosophy. A government controls
and restricts a companys activities by encouraging and offering support or by discouraging and
banning or restricting its activities depending on the pleasure of the government.
International law recognizes the sovereign right of a nation to grant or withhold permission to do
business within its political boundaries and to control where its citizens conduct business. Thus
the political environment of countries is a critical concern for the international marketer.
In the context of international law, sovereign state is independent ad free from all external
control, enjoys full legal equality with other states; governs its own territory; selects its own
political, economic and social stems; and has the power to enter into agreements with other
nations. Sovereignty refers to both the powers exercised by state in relation to other countries
and the supreme powers exercised over its own members. A state sets requirements for
citizenship, defines geographical boundaries and controls trade and the movement of people and
goods across its borders. Additionally a citizen is subject to the states laws even when beyond
national borders. It is with the extension of national laws beyond a countrys borders that much
of the conflict in international business arises. This is especially true when another country
considers its own sovereignty to be compromised.
Nations can and do abridge specific aspects of their sovereign rights in order to coexist with
other nations. The European Union, North America Free Trade Agreement (NAFTA), North
Atlantic Treaty Organization (NATO) and WTO represent examples of nations voluntarily
agreeing to give up some of their sovereign rights in order to participate with member nations for
a common, mutually beneficial. As indicated, the US, involvement in international political
affiliations is surprisingly low (i.e. it is largely sovereign). Indeed, when it comes to participation
in international treaty regimes the US is ranked near the bottom of the 62 countries included in
the Foreign Policy magazine rankings tied with Thailand, Indonesia and Iran (at 57th) and ahead
of only Malaysia and Taiwan. Most notably the Kyoto Protocol on global climate change and the
International Criminal Court were rejected by the Bush administration, long with lesser known
treaties such as the Basel Convention on the control of Trans-boundary movement of Hazardous
Wastes. This apparent lack of international political engagement is particularly hard to
understand given the wide acceptance that such agreements lead to peace and mutual
understanding.

Countries that agree to relinquish some of their sovereignty often are subject to a nagging fear
that too much has been given away. For example, the WTO is considered by some as the biggest
threat so far to national sovereignty. Adherence to the WTO inevitably means loss of some
degrees of national sovereignty because the member nations have pledged to abide by
international covenants and arbitrations procedures that can over ride national laws and have far
reaching ramifications for citizens. Sovereignty was one of the issues at the heart of the spat
between the United States and the European Union over Europes refusal to lower tariffs and
quotas on bananas and critics of the free trade agreement with Central American countries
(CAFTA) claim Americas sacrifice of sovereignty is too great.

Sovereignty
From Wikipedia, the free encyclopedia
"Sovereign" redirects here. For other uses, see Sovereign (disambiguation).
This article may contain original research. Please improve it by verifying
the claims made and adding references. Statements consisting only of original
research may be removed. More details may be available on the talk page.
(January 2011)

The frontispiece of Thomas Hobbes' Leviathan, depicting the Sovereign as a

massive body wielding a sword and crozier and composed of many individual
people.

Sovereignty is the quality of having supreme, independent authority over a geographic area,
such as a territory.[1] It can be found in a power to rule and make law that rests on a political fact
for which no purely legal explanation can be provided. In theoretical terms, the idea of
"sovereignty", historically, from Socrates to Thomas Hobbes, has always necessitated a moral
imperative on the entity exercising it.
The United Nations currently only requires that a sovereign state has an effective and
independent government within a defined territory. According to current international law norms,
states are only required to have an effective and independent system of government pursuant to a
community within a defined territory.[2]
For centuries past, the idea that a state could be sovereign was always connected to its ability to
guarantee the best interests of its own citizens. Thus, if a state could not act in the best interests
of its own citizens, it could not be thought of as a sovereign state.[3]
The concept of sovereignty has been discussed, debated and questioned throughout history, from
the time of the Romans through to the present day. It has changed in its definition, concept, and
application throughout, especially during the Age of Enlightenment. The current notion of state
sovereignty is often traced back to the Peace of Westphalia (1648), which, in relation to states,
codified the basic principles:

territorial integrity
border inviolability

supremacy of the state (rather than the Church)

a sovereign is the supreme lawmaking authority within its jurisdiction. [citation

needed]

Contents
[hide]

1 History
o 1.1 Classical
o

1.2 Medieval

1.3 Reformation

1.4 Age of Enlightenment

2 Definition and types

o

2.1 Absoluteness

2.2 Exclusivity

2.3 De jure and de facto

2.4 Internal

2.5 External

2.6 Shared

2.7 Tribal

2.8 Nation-states

2.9 Federations

3 Acquisition

4 Justifications

5 Views on

6 Relation to rule of law

7 Sovereign as a title

8 See also

9 References

10 Further reading

[edit] History
Different cultures and governments have, understandably, had different ideas about sovereignty.
[citation needed]

[edit] Classical
The Roman jurist Ulpian observed that:[citation needed]

The imperium of the people is transferred to the Emperor,

The Emperor is not bound by the law,

The Emperor's word is law. Emperor is the law making and abiding force.

Ulpian was expressing the idea that the Emperor exercised a rather absolute form of sovereignty,
although he did not use the term expressly. Ulpian's statements were known in medieval Europe,
but sovereignty was not an important concept in medieval times. Medieval monarchs were not
sovereign, at least not strongly so, because they were constrained by, and shared power with,
their feudal aristocracy. Furthermore, both were strongly constrained by custom.[citation needed]

[edit] Medieval
Sovereignty existed during the Medieval Period as the de jure rights of nobility and royalty, and
in the de facto capability of individuals to make their own choices in life.[citation needed]
Around c. 1380-1400, the issue of feminine sovereignty was addressed in Geoffrey Chaucer's
Middle English collection of Canterbury Tales, specifically in The Wife of Bath's Tale.[4]
A later English Arthurian romance, The Wedding of Sir Gawain and Dame Ragnell (c. 1450),[5]
uses much of the same elements of the Wife of Bath's tale, yet changes the setting to the court of
King Arthur and the Knights of the Round Table. The story revolves around the knight Sir
Gawain granting to Dame Ragnell, his new bride, what is purported to be wanted most by
women: sovereignty.
We desire most from men,
From men both rich and poor,
To have sovereignty without lies.
For where we have sovereignty, all is ours,
Though a knight be ever so fierce,
And ever win mastery.
It is our desire to have master
Over such a sir.
Such is our purpose.
The Wedding of Sir Gawain and Dame Ragnell (c. 1450), [5]

[edit] Reformation
Sovereignty reemerged as a concept in the late 16th century, a time when civil wars had created a
craving for stronger central authority, when monarchs had begun to gather power into their own
hands at the expense of the nobility, and the modern nation state was emerging. Jean Bodin,
partly in reaction to the chaos of the French wars of religion; and Thomas Hobbes, partly in
reaction to the English Civil War, both presented theories of sovereignty calling for strong
central authority in the form of absolute monarchy. In his 1576 treatise Les Six Livres de la
Rpublique ("Six Books of the Republic") Bodin argued that it is inherent in the nature of the
state that sovereignty must be:[citation needed]

Absolute: On this point he said that the sovereign must not be hedged in with
obligations and conditions, must be able to legislate without his (or its)
subjects' consent, must not be bound by the laws of his predecessors, and
could not, because it is illogical, be bound by his own laws.
Perpetual: Not temporarily delegated as to a strong leader in an emergency
or to a state employee such as a magistrate. He held that sovereignty must
be perpetual because anyone with the power to enforce a time limit on the
governing power must be above the governing power, which would be
impossible if the governing power is absolute.

Bodin rejected the notion of transference of sovereignty from people to sovereign; natural law
and divine law confer upon the sovereign the right to rule. And the sovereign is not above divine
law or natural law. He is above (ie. not bound by) only positive law, that is, laws made by
humans. The fact that the sovereign must obey divine and natural law imposes ethical constraints
on him. Bodin also held that the lois royales, the fundamental laws of the French monarchy
which regulated matters such as succession, are natural laws and are binding on the French
sovereign. How divine and natural law could in practice be enforced on the sovereign is a
problematic feature of Bodin's philosophy: any person capable of enforcing them on him would
be above him.[citation needed]
Despite his commitment to absolutism, Bodin held some moderate opinions on how government
should in practice be carried out. He held that although the sovereign is not obliged to, it is
advisable for him, as a practical expedient, to convene a senate from whom he can obtain advice,
to delegate some power to magistrates for the practical administration of the law, and to use the
Estates as a means of communicating with the people.[citation needed]
With his doctrine that sovereignty is conferred by divine law, Bodin predefined the scope of the
divine right of kings.[citation needed]

[edit] Age of Enlightenment

Hobbes, in Leviathan (1651) introduced an early version of the social contract (or contractarian)
theory, arguing that to overcome the "nasty, brutish and short" quality of life without the
cooperation of other human beings, people must join in a "commonwealth" and submit to a
"Soveraigne [sic] Power" that is able to compel them to act in the common good. This

expediency argument attracted many of the early proponents of sovereignty. Hobbes deduced
from the definition of sovereignty that it must be:[citation needed]

Absolute: because conditions could only be imposed on a sovereign if there

were some outside arbitrator to determine when he had violated them, in
which case the sovereign would not be the final authority.

Indivisible: The sovereign is the only final authority in his territory; he does
not share final authority with any other entity. Hobbes held this to be true
because otherwise there would be no way of resolving a disagreement
between the multiple authorities.

Hobbes' hypothesis that the ruler's sovereignty is contracted to him by the people in return for his
maintaining their safety, led him to conclude that if the ruler fails to do this, the people are
released from their obligation to obey him.
Bodin's and Hobbes's theories would decisively shape the concept of sovereignty, which we can
find again in the social contract theories, for example, in Rousseau's (17121778) definition of
popular sovereignty (with early antecedents in Francisco Surez's theory of the origin of power),
which only differs in that he considers the people to be the legitimate sovereign. Likewise, it is
inalienable Rousseau condemned the distinction between the origin and the exercise of
sovereignty, a distinction upon which constitutional monarchy or representative democracy are
founded. Niccol Machiavelli, Thomas Hobbes, John Locke, and Montesquieu are also key
figures in the unfolding of the concept of sovereignty.
The second book of Jean-Jacques Rousseau's Du Contrat Social, ou Principes du droit politique
(1762) deals with sovereignty and its rights. Sovereignty, or the general will, is inalienable, for
the will cannot be transmitted; it is indivisible, since it is essentially general; it is infallible and
always right, determined and limited in its power by the common interest; it acts through laws.
Law is the decision of the general will in regard to some object of common interest, but though
the general will is always right and desires only good, its judgment is not always enlightened,
and consequently does not always see wherein the common good lies; hence the necessity of the
legislator. But the legislator has, of himself, no authority; he is only a guide who drafts and
proposes laws, but the people alone (that is, the sovereign or general will) has authority to make
and impose them.[citation needed]
Rousseau, in his 1763 treatise Of the Social Contract[6] argued, "the growth of the State giving
the trustees of public authority more and means to abuse their power, the more the Government
has to have force to contain the people, the more force the Sovereign should have in turn in order
to contain the Government," with the understanding that the Sovereign is "a collective being of
wonder" (Book II, Chapter I) resulting from "the general will" of the people, and that "what any
man, whoever he may be, orders on his own, is not a law" (Book II, Chapter VI) and
furthermore predicated on the assumption that the people have an unbiased means by which to
ascertain the general will. Thus the legal maxim, "there is no law without a sovereign."[7]
The 1789 French Revolution shifted the possession of sovereignty from the sovereign ruler to the
nation and its people.

Carl Schmitt (18881985) defined sovereignty as "the power to decide the state of exception", in
an attempt, argues Giorgio Agamben, to counter Walter Benjamin's theory of violence as
radically disjoint from law. Georges Bataille's heterodox conception of sovereignty, which may
be said to be an "anti-sovereignty", also inspired many thinkers, such as Jacques Derrida,
Agamben or Jean-Luc Nancy.[citation needed]

[edit] Definition and types

There exists perhaps no conception the meaning of which is more

controversial than that of sovereignty. It is an indisputable fact that this
conception, from the moment when it was introduced into political
science until the present day, has never had a meaning which was
universally agreed upon.

Lassa Oppenheim, an authority on international law [8]

[edit] Absoluteness
An important factor of sovereignty is its degree of absoluteness. A sovereign power has absolute
sovereignty when it is not restricted by a constitution, by the laws of its predecessors, or by
custom, and no areas of law or policy are reserved as being outside its control. International law;
policies and actions of neighboring states; cooperation and respect of the populace; means of
enforcement; and resources to enact policy are factors that might limit sovereignty. For example,
parents are not guaranteed the right to decide some matters in the upbringing of their children
independent of societal regulation, and municipalities do not have unlimited jurisdiction in local
matters, thus neither parents nor municipalities have absolute sovereignty. Theorists have
diverged over the desirability of increased absoluteness.

[edit] Exclusivity
A key element of sovereignty in a legalistic sense is that of exclusivity of jurisdiction.
Specifically, the degree to which decisions made by a sovereign entity might be contradicted by
another authority. International law, competing branches of government, and authorities reserved
for subordinate entities (such as federated states or republics) represent legal infringements on
exclusivity. Social institutions such as religious bodies, corporations, and competing political
parties might represent de facto infringements on exclusivity.

[edit] De jure and de facto

De jure, or legal, sovereignty concerns the expressed and institutionally recognised right to
exercise control over a territory.
De facto, or actual, sovereignty is concerned with whether control in fact exists. Cooperation and
respect of the populace; control of resources in, or moved into, an area; means of enforcement

and security; and ability to carry out various functions of state all represent measures of de facto
sovereignty. When control is practiced predominately by military or police force it is considered
coercive sovereignty.
It is generally held that sovereignty requires not only the legal right to exercise power, but the
actual exercise of such power. Thus, de jure sovereignty without de facto sovereignty has limited
recognition.[citation needed]
For instance, in theory, both the People's Republic of China and the Republic of China
considered themselves sovereign governments over the whole territory of China, including
Taiwan. Both the Republic of China and the People's Republic of China are recognised as valid
states by various foreign governments. However, the People's Republic of China has de facto
sovereignty over mainland China, but not Taiwan, while the Republic of China has de facto
sovereignty over Taiwan but not mainland China.

[edit] Internal
Internal sovereignty is the relationship between a sovereign power and its own subjects. A central
concern is legitimacy: by what right does a government exercise authority? Claims of legitimacy
might refer to the divine right of kings or to a social contract (i.e. popular sovereignty).[citation needed]
With Sovereignty meaning holding supreme, independent authority over a region or state,
Internal Sovereignty refers to the internal affairs of the state and the location of supreme power
within it.[9] A state that has internal sovereignty is one with a government that has been elected by
the people and has the popular legitimacy. Internal sovereignty examines the internal affairs of a
state and how it operates. It is important to have strong internal sovereignty in relation to keeping
order and peace. When you have weak internal sovereignty organization such as rebel groups
will undermined the authority and disrupt the peace. The presence of a strong authority allows
you to keep agreement and enforce sanctions for the violation of laws. The ability for leadership
to prevent these violations is a key variable in determining internal sovereignty.[10] The lack of
internal sovereignty can cause war in one of two ways, first, undermining the value of agreement
by allowing costly violations and second requiring such large subsidies for implementation that
they render war cheaper than peace.[11] Leadership needs to be able to promise members,
especially those like armies, police forces, or paramilitaries will abide by agreements. The
presence of strong internal sovereignty allows a state to deter opposition groups in exchange for
bargaining. It has been said that a more decentralized authority would be more efficient in
keeping peace because the deal must please not only the leadership but also the opposition group.
While the operations and affairs within a state are relative to the level of sovereignty within that
state, there is still an argument between who should hold the authority in a sovereign state.
This argument between who should hold the authority within a sovereign state is called the
traditional doctrine of public sovereignty. This discussion is between an internal sovereign or a
authority of public sovereignty. An internal sovereign is a political body that possesses ultimate,
final and independent authority; one whose decisions are binding upon all citizens, groups and
institutions in society. Early thinkers believe sovereignty should be vested in the hands of a
single person, a monarch. They believed the overriding merit of vesting sovereignty in a single

individual was that sovereignty would therefore be indivisible; it would be expressed in a single
voice that could claim final authority. An example of an internal sovereign or monarch is Louis
XIV of France during the seventeenth century; Louis XIV claimed that he was the state. JeanJacques Rousseau rejected monarchial rule in favor of the other type of authority within a
sovereign state, public sovereignty. Public Sovereignty is the belief that ultimate authority is
vested in the people themselves, expressed in the idea of the general will. This means that the
power is elected and supported by its members, the authority has a central goal of the good of the
people in mind. The idea of public sovereignty has often been the basis for modern democratic
theory.[12]
Modern Internal Sovereignty: Within the modern governmental system you usually find internal
sovereignty in states that have public sovereignty and rarely find it within a state controlled by an
internal sovereign. A form of government that is a little different from both is the UK parliament
system. From 1790-1859 it was argued that sovereignty in the UK was vested neither in the
Crown nor in the people but in the "Monarch in Parliament". This is the origin of the doctrine of
parliamentary sovereignty and is usually seen as the fundamental principle of the British
constitution. With these principles of parliamentary sovereignty majority control can gain access
to unlimited constitutional authority, creating what has been called "elective dictatorship" or
"modern autocracy". Public sovereignty in modern governments is a lot more common with
examples like the USA, Canada, Australia and India where government is divided into different
levels.[13]

[edit] External
See also: Sovereign state#Recognition

External sovereignty concerns the relationship between a sovereign power and other states. For
example, the United Kingdom uses the following criterion when deciding under what conditions
other states recognise a political entity as having sovereignty over some territory;

"Sovereignty." A government which exercises de facto administrative

control over a country and is not subordinate to any other government in
that country is a foreign sovereign state.

(The Arantzazu Mendi, [1939] A.C. 256), Strouds Judicial Dictionary

External sovereignty is connected with questions of international law, such as: when, if ever, is
intervention by one country onto another's territory permissible?
Following the Thirty Years' War, a European religious conflict that embroiled much of the
continent, the Peace of Westphalia in 1648 established the notion of territorial sovereignty as a
norm of noninterference in the affairs of other nations, so-called Westphalian sovereignty, even
though the actual treaty itself reaffirmed the multiple levels of sovereignty of the Holy Roman
Empire. This resulted as a natural extension of the older principle of cuius regio, eius religio
(Whose realm, his religion), leaving the Roman Catholic Church with little ability to interfere

with the internal affairs of many European states. It is a myth, however, that the Treaties of
Westphalia created a new European order of equal sovereign states.[2]
In international law, sovereignty means that a government possesses full control over affairs
within a territorial or geographical area or limit. Determining whether a specific entity is
sovereign is not an exact science, but often a matter of diplomatic dispute. There is usually an
expectation that both de jure and de facto sovereignty rest in the same organisation at the place
and time of concern. Foreign governments use varied criteria and political considerations when
deciding whether or not to recognise the sovereignty of a state over a territory.[citation needed]
Sovereignty may be recognized even when the sovereign body possesses no territory or its
territory is under partial or total occupation by another power. The Holy See was in this position
between the annexation in 1870 of the Papal States by Italy and the signing of the Lateran
Treaties in 1929, when it was recognised as sovereign by many (mostly Roman Catholic) states
despite possessing no territory a situation resolved when the Lateran Treaties granted the Holy
See sovereignty over the Vatican City. Another case, sui generis, though often contested, is the
Sovereign Military Order of Malta, the third sovereign entity inside Italian territory (after San
Marino and the Vatican City State) and the second inside the Italian capital (since in 1869 the
Palazzo di Malta and the Villa Malta receive extraterritorial rights, in this way becoming the only
"sovereign" territorial possessions of the modern Order), which is the last existing heir to one of
several once militarily significant, crusader states of sovereign military orders. In 1607 its Grand
masters were also made Reichsfrst (princes of the Holy Roman Empire) by the Holy Roman
Emperor, granting them seats in the Reichstag, at the time the closest permanent equivalent to a
UN-type general assembly; confirmed 1620). These sovereign rights never deposed, only the
territories were lost. 100 modern states still maintain full diplomatic relations with the order[14]
(now de facto "the most prestigious service club"), and the UN awarded it observer status.[15]
The governments-in-exile of many European states (for instance, Norway, Netherlands or
Czechoslovakia) during the Second World War were regarded as sovereign despite their
territories being under foreign occupation; their governance resumed as soon as the occupation
had ended. The government of Kuwait was in a similar situation vis--vis the Iraqi occupation of
its country during 1990-1991.[citation needed]
Commonly mistaken to be sovereign, the International Committee of the Red Cross, having been
granted various degrees of special privilege and legal immunity in many countries,[which?] that in
cases like Switzerland are considerable for a private organisation governed by Swiss law.[16] By
formal agreement between the Swiss government and the ICRC, Switzerland grants full sanctity
of all ICRC property in Switzerland including its headquarters and archive, grants members and
staff legal immunity, exempts the ICRC from all taxes and fees, guarantees the protected and
duty-free transfer of goods, services, and money, provides the ICRC with secure communication
privileges at the same level as foreign embassies, and simplifies Committee travel in and out of
Switzerland. On the other hand Switzerland does not recognize ICRC issued passports, which are
described[by whom?] as amounting to de facto sovereignty.

[edit] Shared
Just as the office of head of state can be vested jointly in several persons within a state, the
sovereign jurisdiction over a single political territory can be shared jointly by two or more
consenting powers, notably in the forms of a condominium or a co-principality (e.g. Andorra).
[citation needed]

[edit] Tribal
Main article: Tribal sovereignty

[edit] Nation-states
A community of people who claim the right of self-determination based on a common ethnicity,
history and culture might seek to establish sovereignty over a region, thus creating a nation-state.
Such nations are sometimes recognised as autonomous areas rather than as fully sovereign,
independent states.

[edit] Federations
In a federal system of government, sovereignty also refers to powers which a constituent state or
republic possesses independently of the national government. In a confederation constituent
entities retain the right to withdraw from the national body, but in a federation member states or
republics do not hold that right.
Controversy over states' rights contributed to the outbreak of the American Civil War. Eleven
southern states in which slavery was legal declared their independence from the United States
and formed the Confederate States of America. The position of the United States government
was that this act was unconstitutional and that secession was not a right that the states possessed,
and thus that the states were not sovereign entities.[citation needed]

[edit] Acquisition
Main article: Acquisition of sovereignty

A number of methods of acquisition of sovereignty are presently or have historically been

recognised by international law as lawful methods by which a state may acquire sovereignty over
territory.[citation needed]

[edit] Justifications
There exist vastly differing views on the moral basis of sovereignty. A fundamental polarity is
between theories that assert that sovereignty is vested directly in the sovereign by divine or
natural right, and theories that assert it originates from the people. In the latter case there is a
further division into those that assert that the people transfer their sovereignty to the sovereign
(Hobbes), and those that assert that the people retain their sovereignty (Rousseau).[citation needed]

Absolute monarchies are typically based on concepts such as the divine right of kings in Europe
or the mandate of Heaven in China.
A republic is a form of government in which the people, or some significant portion of them,
retain sovereignty over the government and where offices of state are not granted through
heritage.[17][18] A common modern definition of a republic is a government having a head of state
who is not a monarch.[19][20]
Democracy is based on the concept of popular sovereignty. In a direct democracy the public
plays an active role in shaping and deciding policy. Representative democracy permits a transfer
of the exercise of sovereignty from the people to a legislative body or an executive (or to some
combination of legislature, executive and Judiciary). Many representative democracies provide
limited direct democracy through referendum, initiative, and recall.
Parliamentary sovereignty refers to a representative democracy where the parliament is
ultimately sovereign and not the executive power nor the judiciary.

[edit] Views on

Realists view sovereignty as being untouchable and as guaranteed to

legitimate nation-states.[citation needed]
Rationalists see sovereignty similarly to Realists. However, Rationalism states
that the sovereignty of a nation-state may be violated in extreme
circumstances, such as human rights abuses. [citation needed]

Internationalists believe that sovereignty is outdated and an unnecessary

obstacle to achieving peace, in line with their belief of a 'global community'.
In the light of the abuse of power by sovereign states such as Hitler's
Germany or Stalin's Soviet Union, they argue that human beings are not
necessarily protected by the state whose citizens they are, and that the
respect for state sovereignty on which the UN Charter is founded is an
obstacle to humanitarian intervention.[2]

Anarchists and some libertarians deny the sovereignty of states and

governments. Anarchists often argue for a specific individual kind of
sovereignty, such as the Anarch as a sovereign individual. Salvador Dal, for
instance, talked of "anarcho-monarchist" (as usual for him, tongue in cheek);
Antonin Artaud of Heliogabalus: Or, The Crowned Anarchist; Max Stirner of
The Ego and Its Own; Georges Bataille and Jacques Derrida of a kind of
"antisovereignty". Therefore, anarchists join a classical conception of the
individual as sovereign of himself, which forms the basis of political
consciousness. The unified consciousness is sovereignty over one's own
body, as Nietzsche demonstrated (see also Pierre Klossowski's book on
Nietzsche and the Vicious Circle). See also self-ownership.

Imperialists hold a view of sovereignty where power rightfully exists with

those states that hold the greatest ability to impose the will of said state, by
force or threat of force, over the populace or other states with weaker military
or political will. They effectively deny the sovereignty of the individual in
deference to either the 'good' of the whole, or to divine right.[citation needed]

[edit] Relation to rule of law

Another topic is whether the law is held to be sovereign, that is, whether it is above political or
other interference. Sovereign law constitutes a true state of law, meaning the letter of the law (if
constitutionally correct) is applicable and enforceable, even when against the political will of the
nation, as long as not formally changed following the constitutional procedure. Strictly speaking,
any deviation from this principle constitutes a revolution or a coup d'tat, regardless of the
intentions.[citation needed]

[edit] Sovereign as a title

In some cases, the title sovereign is not just a generic term, but an actual (part of the) formal
style of a Head of state.[citation needed]
Thus from 22 June 1934, to 29 May 1953, (the title "Emperor of India" was dropped as of 15
August 1947, by retroactive proclamation dated 22 June 1948), the King of South Africa was
styled in the Dominion of South Africa: "By the Grace of God, of Great Britain, Ireland and of
the British Dominions beyond the Seas King, Defender of the Faith, Emperor of India and
Sovereign in and over the Union of South Africa." Upon the accession of Elizabeth II to the
Throne of South Africa in 1952, the title was changed to Queen of South Africa and Her other
Realms and Territories, Head of the Commonwealth, parallel to the style used in almost all the
other Commonwealth realms. The pope holds ex officio the title "Sovereign of the Vatican City
State" in respect to Vatican City.[citation needed]
The adjective form can also be used in a Monarch's full style, as in pre-imperial Russia, 16
January 1547 22 November 1721: Bozhiyeyu Milostiyu Velikiy/Velikaya
Gosudar'/Gosudarynya Tsar'/Tsaritsa i Velikiy/Velikaya Knyaz'/Knyaginya N.N. vseya Rossiy
Samodyerzhets "By the Grace of God Great Sovereign Tsar/Tsarina and Grand Prince/Princess,
N.N., of All Russia, Autocrat"

National sovereignty
From Wikipedia, the free encyclopedia
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Detail of the monument in Cdiz to the Spanish Constitution of 1812, Spain's first written
constitution, which established the principal of national sovereignty.
National sovereignty is the doctrine that sovereignty belongs to and derives from the nation, an
abstract entity normally linked to a physical territory and its past, present, and future citizens. It
is an ideological concept or doctrine derived from liberal political theory. It traces back to John
Locke in late 17th century England and to Montesquieu in 18th century France, the latter
especially via Emmanuel-Joseph Sieys pamphlet What Is the Third Estate?.
Under the concept of national sovereignty, the nation is superior to the individuals of which it is
composed. National sovereignty can be contrasted, on the one hand, to absolutism and to other
doctrines that see sovereignty as residing solely in a monarch, aristocracy, theocracy or other
small elite, and on the other hand to popular sovereignty, which has more egalitarian
implications.
The relationship between the concepts of national sovereignty and citizenship is mutual. Citizens
who are not necessarily the entire populace of a territorypossess rights and have a
relationship of equality to one another under the law. They are not mere subjects or vassals
whose rights are delegated by a higher authority, nor are they passive objects of a political entity.
In classical political theory, national sovereignty translates into a representative constitutional
system, because a nation cannot be governed by direct democracy, given the impossibility of
direct representation of its past and future citizens. The simple majority of the residents of the
territory of a nation, or even of its citizens, is not necessarily considered identical to the will of
the nation.
The first clear application of the doctrine of national sovereignty was in the constitutions of the
French Revolution (17891799); the United States, founded in 1776 had relied more on the
theory of popular sovereignty and had been first a confederation and later a federation of the
states that retained certain aspects of sovereignty vis a vis the nation. National sovereignty is

conceived as indivisible and inalienable, not simply parceled out among individuals or any other
units who form the nation. The French Revolution was explicitly national, based on the concept
of a nation state whose interests took precedence over those of individuals, even while
guaranteeing rights to individuals. Article 3 of the French Declaration of the Rights of Man and
of the Citizen declared explicitly that "all sovereignty resides essentially in the nation".
Thus, under this doctrine, each individual is part of the nation, but it is a whole based on
something more than direct representation. National sovereignty does not necessarily imply
universal suffrage or electoral equality, both of which are usually considered to be inherent in the
logic of popular sovereignty. Under national sovereignty, the vote is not an individual right, but a
means to the end of determining the national will. The franchise may be restricted by some
system of census suffrage; in practice, this restriction has most often been on the basis of
personal wealth.
Political party

The impact of political parties, interest

groups, and social movement organizations
on public policy: some recent evidence and
theoretical concerns *.

Social Forces
December 1, 2002 | Burstein, Paul; Linton, April | Copyright
Share
Everyone who studies democratic politics agrees that political parties, interest groups, and
social movement organizations (SMOs) strongly influence public policy. These political
organizations define public problems, propose solutions, aggregate citizens' policy preferences,
mobilize voters, make demands of elected officials, communicate information about government
action to their supporters and the larger public, and make relatively coherent legislative action
possible. They seem indispensable to democratic policy making; no democratic polity in the
modern world is without them (on the role of political parties in the democratic process, see
Aldrich 1995; on interest groups, see Hansen 1991; on SMOs, see Tilly 1984).
This article focuses on the most obvious way that political organizations affect policy: by
influencing the final stage of legislative activity, when policy changes are, or are not, enacted
into law. We consider the direct impact of political organizations on policy change, that is, the
impact organizations have after considering other potential influences. This is a common

approach to the study of policy change, and impact gauged in this way is what social scientists
are most often referring to when they discuss the determinants of public policy. (1)
We begin with what might be called the "core" hypothesis in studies of the direct impact of
political organizations on policy; we then present three additional hypotheses that qualify or
refine the core hypothesis, and provide evidence relevant to all four hypotheses.
1. The core hypothesis: Political organizations have a substantial direct impact on policy change.
Effectively, this means that they have a substantial impact even after all other variables
commonly included in recent studies are taken into account.
2. When public opinion on a policy (including opinions about its importance) is taken into
account, political organizations' direct impact will decline substantially or even disappear.
3. When political organizations have a direct impact on policy, the impact of political parties
will be greater (in both frequency and magnitude) than the impact of interest groups and SMOs.
4. Interest groups and SMOs will affect policy only to the extent that their activities provide
elected officials with information and resources relevant to their prospects for reelection.
Our evidence is of a somewhat unusual type, in that it has all been provided by others. We have
analyzed every article on policy change in the three most prestigious sociology journals -- the
American Sociological Review, American Journal of Sociology, and Social Forces -- and the
three most prestigious political science journals -- the American Political Science Review,
American Journal of Political Science, and Journal of Politics -- since 1990. But we have not
done a literature review in the usual sense. Rather than summarizing the arguments and
conclusions of the articles in a conventional narrative, we used each article as a source of data,
systematically tabulating the authors' predictions, variables, indicators, and findings, along with
information about which policy issues are studied in which countries. These data will be
analyzed to show how often research supports each hypothesis, and also, at times, to highlight
how little evidence is available and how little we know.
Almost all research about the direct impact of political organizations on policy is based on the
core hypothesis. Yet we find that it is consistent with the data only about half the time, and, of
this half, in only about half the cases is the impact of political organizations found to be more
than minimal. Political parties do not appear to have more impact than interest groups or SMOs.
Finally, we note that few studies consider the relative impact of political organizations and
public opinion, or the role of interest groups and SMOs as conveyers of political information.
The evidence suggests an agenda for future research.
Theory
THE IMPACT OF POLITICAL ORGANIZATIONS ON POLICY
It is virtually a truism among sociologists that political parties, SMOs, and interest groups all
affect policy. On parties, for example, Hicks and Misra (1993) point out that among those

adopting the "social democratic" theory of social welfare policy, "the key ... proposition is that
increases in left-party government augment welfare effort" (675, emphasis in original); Huber,
Ragin, and Stephens (1993) hypothesize that "the relative strength of parties ... profoundly
shape[s] ... social and economic policies" (716), Amenta and Poulsen (1996) argue that if
Democratic and third-party politicians "take control of state governments...., the resulting
regimes are expected to increase social spending" (34, when the political system is democratic
and policy oriented). The view on social movements and SMOs is the same; as McAdam,
McCarthy and Zald (1988) state in their much-cited review article, "The interest of many
scholars in social movements stems from their belief that movements represent an important
force f or social change" (727). Sociologists do not often study interest groups, but when they do,
they expect them to influence policy as well (e.g., Campbell & Allen 1994:655).
Political scientists disagree among themselves more than sociologists do on the impact of
parties, SMOs, and interest groups on policy (as will be detailed below), but they often do
hypothesize that political organizations will indeed have an impact (e.g., on parties, see Blais,
Blake & Dion 1993; Tufte 1978; on SMOs, see Tarrow 1994:1; Wald, Button & Rienzo 1996; on
interest groups, Austen-Smith & Wright 1994:42).
How much impact are political organizations expected to have? Sociologists and political
scientists seldom address this question explicitly. Their language is nearly always that used in the
first two examples above, where organizations are hypothesized to "augment" or "increase" the
relevant policy outcome, but they say little about how great the impact is expected to be, even in
very general terms. It seems reasonable to infer, however, that authors expect an impact large
enough to matter politically. They would hardly find it worthwhile to analyze organizational
impacts they expect to be politically inconsequential, even if by conventional statistical criteria
they are probably not zero. Most researchers, we presume, want theoretical and substantive
answers to the question that forms the title of a recent review article on social movements: "Was
It Worth the Effort?" (Giugni's 1998).
Sociologists and political scientists expect the impact of political organizations on policy to be
substantial. So pervasive is the view that political organizations have a substantial impact on
policy that we treat it as a core hypothesis in the study of democratic politics. Work on the
determinants of policy change either argues on behalf of the hypothesis, or responds to it in some
way.
POLITICAL ORGANIZATIONS AND PUBLIC OPINION
The most direct challenge to the core hypothesis is provided by political scientists' work in
democratic theory. Beginning with Downs' Economic Theory of Democracy (1957) over 40
years ago, many political scientists (and some economists) have argued that electoral
competition frequently forces elected officials to enact policies consistent with public opinion.
Officeholders usually strongly want to win reelection, and believe that failure to do what the
public wants will mean defeat (see Arnold 1990; Dahl 1989; Mayhew 1974). This argument has
major implications for our expectations about the direct impact of political organizations on
policy. When a majority of the public favors a policy, both parties in a two-party system, and all
major parties in multiparty systems, will respond, and the policy is likely to be enacted

regardless of what the party balance is. The direct impact of party, as conventionally measured,
will be zero (see also Erikson, Wright & McIver 1993 for a good explication of this argument).
This will be especially likely when the public is intensely concerned about an issue, because it is
then that elected officials can be most certain that their actions will influence citizens' party
choice. When the public is relatively indifferent, parties and elected officials may have more
freedom to act on the basis of differing ideologies; then the party balance may matter (Arnold
1990; Jones 1994).
A similar argument applies to SMOs and interest groups. When a majority of the public wants
particular policies enacted, it would be foolish for officeholders to respond to the wishes of
SMOs and interest groups, especially when the public's level of concern is high. Lohmann
(1993:319) states this view especially bluntly, but her opinion is fairly widely shared among
political scientists: "[i]t is puzzling that rational political leaders with majoritarian incentives
would ever respond to political action" by SMOs or interest groups. Burstein (1999:9) sums up
this argument in what he calls "the direct impact hypothesis": "the greater and more persistent the
majority favoring a particular policy, and the more important the issue to that majority, as
perceived by legislators, the smaller the direct impact of interest organizations [i.e., SMOs and
interest groups together] on legislative action."
Thus, in opposition to the core hypothesis is what might be called the public opinion hypothesis:
When public opinion on a policy (including opinions about its importance) is taken into account,
political organizations' direct impact will decline substantially or even disappear.
PARTIES VS. INTEREST GROUPS AND SMOs
Neither the core hypothesis nor the public opinion hypothesis distinguish among types of
political organizations. Many political scientists would argue, however, that political parties
differ from the other two types of organizations in a critical way: unlike interest groups and
SMOs, parties actually control the government. It is easy to imagine (for many political
scientists, at least) that elected officials would ignore interest groups and SMOs when their
reelection is at stake, but the dynamics with regard to political parties are more complicated.
Many party activists are likely to have gotten into politics because they are strongly committed
to relatively extreme ideological views, and, when their party wins power, may be torn between
the need to follow public opinion and their desire to transform their own ideologies into policy.
Even elected officials most strongly oriented to reelection, and therefore to public opinion, may
find it difficult to ignore party activists holding relatively extreme views. Activists' support may
be crucial for winning nomination, and their time and money may be essential for winning the
general election as well (Aldrich 1995). Thus, the internal dynamics of parties and the electoral
system may combine to give substantial power to those in both parties who are relatively
reluctant to follow public opinion on the issues that matter most to them. When this happens, the
parties may espouse quite different policies, and a change in the party balance may lead to
substantial policy change. (2)
In addition, and consistent with the public opinion hypothesis, elected officials may feel it
relatively safe to ignore the public on issues it cares little about (though they must always be
concerned that issues not salient now may become so during the next campaign). When officials

feel this way, all three types of political organizations may affect policy directly; but parties'
control of the government may enable them to turn their preferences into policy more quickly
and effectively than interest groups and SMOs can.
Thus, a first refinement of the core hypothesis, which we might call the relative impact
hypothesis:
When political organizations have a direct impact on policy, the impact of political parties will
be greater (in both frequency and magnitude) than the impact of interest groups and SMOs.
HOW INTEREST GROUPS AND SMOS MAY AFFECT POLICY
Those who study SMOs and interest groups have come to

Economic nationalism is a term used to describe policies which emphasize

domestic control of the economy, labor and capital formation, even if this requires
the imposition of tariffs and other restrictions on the movement of labor, goods and
capital. It opposes globalization in many cases, or at least it questions the benefits
of unrestricted free trade. Economic nationalism may include such doctrines as
protectionism and import substitution.

Economic patriotism
Economic patriotism is the coordinated and promoted behaviour of consumers or companies
(both private and public) that consists of favoring the goods or services produced in their country
or in their group of countries. Economic patriotism can be practiced either through demand
stimulation (encouraging consumers to purchase the goods and servi
s of their own country) or through supply protection, the shielding of the domestic market from
foreign competition through tariffs or quotas (protectionism). A recently emerging form of
economic patriotism is financial protectionism, the hostility against acquisitions by foreign
groups by companies considered of "strategic value"[7] for the economy of the country.

[edit] Objectives
The objective is to support economic activity and promote social cohesion. The supporters of
economic patriotism describe it as a kind of self-defence of local economic interests (national or
European in case of the countries of the European Union). Some manifestations of economic
patriotism are attempts to block foreign competition or acquisitions of domestic companies. An
often cited example is France, where economic patriotism was the main rationale used in the
Pepsico-Danone, Mittal-Arcelor, and GDF-Suez affairs.

In the United States, an example of economic patriotism would be the numerous bumper
stickers: "Be American, Buy American".

[edit] Criticisms
Consumer preference for local goods gives local producers more market power and allows local
producers to lift prices to extract greater profits. This occurs because firms that produce locallyproduced goods can charge a premium for that good. Consumers who favor products by local
producers may end up being exploited by profit-maximizing local producers. For example,
protectionist policy in America that placed tariffs on foreign cars gave local producers Ford and
GM market power that allowed them to raise prices of cars, which negatively affected American
consumers who faced fewer choices and higher prices [2]. However, in most cases where no
cartel is formed, the market forces will create competition for local products, and cause prices to
drop.
Because locally-produced goods can attract a premium if consumers show a preference towards
it, a firm has an incentive to pass foreign goods off as local goods if foreign goods have cheaper
costs of production than local goods. They are able to do this because the line between foreignmade and locally-made is blurry. This brings up the issue of the definition of local goods. For
example, while a particular car may be assembled in America its engine may be made in another
country, say, China. Furthermore, while the engine may be made in China, the engine's
components may be made in several other countries, e.g. the pistons may come from Germany
and the spark plugs may come from Mexico. The components that make up the spark plugs and
pistons may come from different countries and so on.

Political risk
From Wikipedia, the free encyclopedia

Categories of
financial risk
Credit risk
Concentration risk
Market risk
Interest rate risk
Currency risk
Equity risk
Commodity risk
Liquidity risk

Refinancing risk
Operational risk
Legal risk
Political risk
Reputational risk
Volatility risk
Settlement risk
Profit risk
Systemic risk
vde

Political risk is a type of risk faced by investors, corporations, and governments. It is a risk that
can be understood and managed with reasoned foresight and investment.
Broadly, political risk refers to the complications businesses and governments may face as a
result of what are commonly referred to as political decisionsor any political change that
alters the expected outcome and value of a given economic action by changing the probability of
achieving business objectives..[1] Political risk faced by firms can be defined as the risk of a
strategic, financial, or personnel loss for a firm because of such nonmarket factors as
macroeconomic and social policies (fiscal, monetary, trade, investment, industrial, income,
labour, and developmental), or events related to political instability (terrorism, riots, coups, civil
war, and insurrection).[2] Portfolio investors may face similar financial losses. Moreover,
governments may face complications in their ability to execute diplomatic, military or other
initiatives as a result of political risk.
A low level of political risk in a given country does not necessarily correspond to a high degree
of political freedom. Indeed, some of the more stable states are also the most authoritarian. Longterm assessments of political risk must account for the danger that a politically oppressive
environment is only stable as long as top-down control is maintained and citizens prevented from
a free exchange of ideas and goods with the outside world.[3]
Understanding risk as part probability and part impact provides insight into political risk. For a
business, the implication for political risk is that there is a measure of likelihood that political
events may complicate its pursuit of earnings through direct impacts (such as taxes or fees) or
indirect impacts (such as opportunity cost forgone). As a result, political risk is similar to an
expected value such that the likelihood of a political event occurring may reduce the desirability
of that investment by reducing its anticipated returns.
There are both macro- and micro-level political risks. Macro-level political risks have similar
impacts across all foreign actors in a given location. While these are included in country risk

analysis, it would be incorrect to equate macro-level political risk analysis with country risk as
country risk only looks at national-level risks and also includes financial and economic risks.
Micro-level risks focus on sector, firm, or project specific risk.[4]

Contents
[hide]

1 Macro-level political risk

2 Micro-level political risk

3 Political risk and

megaprojects

4 Mitigation

5 References

[edit] Macro-level political risk

Macro-level political risk looks at non-project specific risks. Macro political risks affect all
participants in a given country.[5] A common misconception is that macro-level political risk only
looks at country-level political risk; however, the coupling of local, national, and regional
political events often means that events at the local level may have follow-on effects for
stakeholders on a macro-level. Other types of risk include government currency actions,
regulatory changes, sovereign credit defaults, endemic corruption, war declarations and
government composition changes. These events pose both portfolio investment and foreign direct
investment risks that can change the overall suitability of a destination for investment. Moreover,
these events pose risks that can alter the way a foreign government must conduct its affairs as
well.
Research has shown that macro-level indicators can be quantified and modeled like other types
of risk. For example, Eurasia Group produces a political risk index which incorporates four
distinct categories of sub-risk into a calculation of macro-level political stability. This Global
Political Risk Index can be found in publications like The Economist.[6] Other companies which
offer publications on macro-level political risk include Economist Intelligence Unit and The PRS
Group, Inc.

[edit] Micro-level political risk

Micro-level political risks are project-specific risks. In addition to the macro political risks,
companies have to pay attention to the industry and relative contribution of their firms to the
local economy.[7] An examination of these types of political risks might look at how the local
political climate in a given region may impact a business endeavor. This type of risk process
includes the project-specific government review Committee on Foreign Investment in the United

States (CFIUS), the selection of dangerous local partners with political power, and
expropriation/nationalization of projects and assets.
To extend the CFIUS example above, imagine a Chinese company wished to purchase a US
weapons component producer. A micro-level political risk report might include a full analysis of
the CFIUS regulatory climate as it directly relates to project components and structuring, as well
as analysis of congressional climate and public opinion in the US toward such a deal. This type
of analysis can prove crucial in the decision-making process of a company assessing whether to
pursue such a deal. For instance, Dubai Ports World suffered significant public relations damage
from its attempt to purchase the US port operations of P&O, which might have been avoided
with more clear understanding of the US climate at the time.
Political risk is also relevant for government project decision-making, whereby government
initiatives (be they diplomatic or military or other) may be complicated as a result of political
risk. Whereas political risk for business may involve understanding the host government and
how its actions and attitudes can impact a business initiative, government political risk analysis
requires a keen understanding of politics and policy that includes both the client government as
well as the host government of the activity.

[edit] Political risk and megaprojects

Political risk has been shown to be particularly large for very big investment projects, so-called
megaprojects. This is because such projects are especially visible and are often used for political
purposes, e.g., monument building, in addition to the functional demands the projects are
designed to meet. Moreover, megaprojects have been shown to be prone to controversy because
of widespread cost overrun, schedule delays, and benefit shortfalls for such projects. Controversy
often translates into improvised political decisions, which translate into political risk.[8]

[edit] Mitigation
Companies may have a Chief Risk Officer who is charged with managing political risk or, in
many cases, this job falls to the Chief Financial Officer.
At the macro-level, largely involves understanding political uncertainties of the operating
environment and the risks faced by all business operations in individual countries. Such
information can come in the form of customized analysis or in-depth subject matter reporting;
information that can enable an investor or firm to calibrate their risk appetite. Mitigation tactics
involve both macro- and micro-level strategies. A recent article on the subject suggested that
political risk mitigation should not simply revolve around the decision to enter or avoid a given
countrys marketplace, but should rather center on the pragmatic usage of contingency planning,
intellectual property safeguards, risk diversification, and sound exit planning to guard against
uncertainty.[9]
At the micro-level, political risk insurance and hedges play a larger role. MIGA and OPIC, both
public sector insurers, provide project-specific political risk insurance while private market
insurers can provide cover for projects as well as a portfolio of investments. This type of

insurance usually outlines specific triggers, such as expropriation or breach of contract by a local
party, which entitle the insured entity to a pay-out after relinquishing control of the insured
project to the insurer. Political risk insurance, however, often involves premiums which must
factor in considerable uncertainty and the threat that arbitrary decisions will affect the value of
insured property. Policies therefore can be expensive and are manuscripted after extensive
negotiations. An experienced and specialist broker can assess the availability of appropriate
cover from private and public insurers and then, based on their experience and expertise,
negotiate appropriate policies. Businesses can also purchase hedges, which could be derivative
instruments, which allow them to reduce risk by selecting a level of return based on a given set
of outcomes.
Political risk mitigation takes place before, during, and after an investment. Prior to investment,
businesses can perform due diligence related to local partners and carefully word and structure
their contracts. While a project is on-going, the investor may benefit from building local political
leverage through community activities. After a risk has been realized, its effects may be
mitigated through post-hoc litigation and retaliation, as well as the implementation of a
previously developed contingency plan, or exit from the market.