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Economic Vulnerability and Political Responses to International Pressure: Liechtenstein, Switzerland and the Struggle for Banking Secrecy
Author(s) -
Eggenberger Katrin,
Emmenegger Patrick
Publication year - 2015
Publication title -
swiss political science review
Language(s) - English
Resource type - Journals
SCImago Journal Rank - 1.632
H-Index - 30
eISSN - 1662-6370
pISSN - 1424-7755
DOI - 10.1111/spsr.12181
Subject(s) - secrecy , government (linguistics) , politics , vulnerability (computing) , economics , financial services , political economy , international trade , political science , international economics , law , finance , philosophy , linguistics , computer security , computer science
After doggedly opposing any increase in exchange of information on tax matters for several decades, both Liechtenstein and Switzerland have made significant concessions over recent years. However, the two countries have reacted rather differently to international pressure: while Liechtenstein has adopted a more proactive approach, offering far‐reaching bilateral deals to several major economies, Switzerland has been slow to react to international pressure, despite calls for a more proactive strategy by its financial services industry. We suggest that these differences have a range of causes; in Liechtenstein, in particular, the pressure was more evenly distributed, thus allowing the financial services industry to close ranks and use its privileged access to the government to shape the government's response decisively. By contrast, there was internal division in the Swiss financial services industry and it was soon on the back foot in public debate, eventually losing control over the issue.