Rice and Zegart (2018) argue that today's political risks are more complicated due to several factors:

1. Globalization: The interconnectedness of the world's economies means that political events in one country can have far-reaching effects. A policy change or political upheaval in one country can impact global supply chains, trade agreements, and foreign investments.

2. Technological Advances: The rapid pace of technological change can create new political risks. For example, issues related to data privacy, cybersecurity, and artificial intelligence can all have political implications. Governments may struggle to keep up with these changes, leading to regulatory uncertainty.

3. Rise of Non-State Actors: Non-state actors, such as multinational corporations, non-governmental organizations, and even individuals (like whistleblowers or hackers), can have significant political impact. These actors can influence policy, shape public opinion, and even destabilize governments.

4. Increased Populism: There has been a rise in populist movements around the world, leading to unpredictable policy changes. Populist leaders often appeal to nationalist sentiments, which can lead to protectionist trade policies and increased political risk for foreign investors.

5. Climate Change: The political risks associated with climate change are becoming increasingly complex. Governments are under pressure to transition to low-carbon economies, which can lead to significant policy changes. At the same time, the physical risks associated with climate change can lead to political instability.

6. Geopolitical Shifts: Changes in the balance of power, such as the rise of China and the relative decline of the U.S., can lead to shifts in alliances, trade wars, and other geopolitical risks.

These factors all contribute to an increasingly complex and unpredictable political risk landscape.

Question

Rice and Zegart (2018) argue that today's political risks are more complicated due to several factors:

1. Globalization: The interconnectedness of the world's economies means that political events in one country can have far-reaching effects. A policy change or political upheaval in one country can impact global supply chains, trade agreements, and foreign investments.

2. Technological Advances: The rapid pace of technological change can create new political risks. For example, issues related to data privacy, cybersecurity, and artificial intelligence can all have political implications. Governments may struggle to keep up with these changes, leading to regulatory uncertainty.

3. Rise of Non-State Actors: Non-state actors, such as multinational corporations, non-governmental organizations, and even individuals (like whistleblowers or hackers), can have significant political impact. These actors can influence policy, shape public opinion, and even destabilize governments.

4. Increased Populism: There has been a rise in populist movements around the world, leading to unpredictable policy changes. Populist leaders often appeal to nationalist sentiments, which can lead to protectionist trade policies and increased political risk for foreign investors.

5. Climate Change: The political risks associated with climate change are becoming increasingly complex. Governments are under pressure to transition to low-carbon economies, which can lead to significant policy changes. At the same time, the physical risks associated with climate change can lead to political instability.

6. Geopolitical Shifts: Changes in the balance of power, such as the rise of China and the relative decline of the U.S., can lead to shifts in alliances, trade wars, and other geopolitical risks.

These factors all contribute to an increasingly complex and unpredictable political risk landscape.

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