Straight Talk on Trade: Ideas for a Sane World Economy
... With the exception of a few small countries rich in mineral resources, successful economies have boomed thanks to rapid industrialisation. East Asian countries have been remarkably good at reallocating their labour from the countryside to the cities for organised industrial production, as the US and Germany did before (Rodrik 2018). ...
... However, this is not entirely true because the Netherlands, which also had a high wage level, set out on the path of industrialisation about half a century later, and one only has to think of China to see that low wages do not hinder industrialisation (Ritter and Trautmann 2020). Industrialisation enables rapid development because it is relatively easy for poorer countries to copy and adopt foreign models and production technologies (Rodrik 2018). Rodrik's (2018) research shows that manufacturing is catching up with the technological frontier at a rate of around 3 per cent per year, regardless of policy, institutions and geography. ...
... Industrialisation enables rapid development because it is relatively easy for poorer countries to copy and adopt foreign models and production technologies (Rodrik 2018). Rodrik's (2018) research shows that manufacturing is catching up with the technological frontier at a rate of around 3 per cent per year, regardless of policy, institutions and geography. In a country with a dynamic economy with relative freedom of individual opportunity, technological change is rampant and property assets that originated in older industries almost inevitably have a diminishing proportional weight in the total because of the more rapid growth of younger industries. ...
In recent years, climate change and the pandemic have brought the issue of the link between inequality and economic growth to the fore. In my essay, I examine this relationship, focusing on whether inequality has a positive or negative effect on economic growth. I approach the issue through the lens of income inequality without seeking to explore all aspects of inequality. Starting from the relevant conceptual framework, I present the link between global inequality and long-term growth. Since inequalities affect both developed and developing countries, I compare them and show why the latter cannot repeat the economic progress achieved by earlier industrialisers. Finally, I conclude that the clear objective should be to reduce excessive inequalities.
... Néhány, ásványkincsekben gazdag, kisebb ország kivételével a sikeres gazdaságok a gyors iparosításnak köszönhetik a fellendülésüket. A kelet-ázsiai országok kiemelkedően jók voltak abban, hogy a munkaerejüket vidékről a városokba, a szervezett ipari termelésbe csoportosítsák át, ahogy azt korábban az USA és Németország tette (Rodrik 2018). ...
... Ez azonban nem teljesen igaz, ugyanis egyrészt a szintén magas bérszintű Hollandia körülbelül fél évszázaddal később lépett az Esszé Vitkovics Réka iparosítás útjára, másrészt elég csak Kínára gondolni, hogy belássuk, az alacsony bérszint nem gátolja az iparosodást (Ritter -Trautmann 2020). Az iparosodás azért teszi lehetővé a gyors fejlődést, mert relatíve könnyű lemásolni és átvenni a külföldi mintákat, termelési technológiákat még a szegényebb országoknak is (Rodrik 2018). Rodrik (2018) kutatása azt mutatja, hogy a gyáripar politikától, intézményektől és földrajzi helyzettől függetlenül évente körülbelül 3 százalékos ütemben zárkózik fel a technológiai határokhoz. ...
... Az iparosodás azért teszi lehetővé a gyors fejlődést, mert relatíve könnyű lemásolni és átvenni a külföldi mintákat, termelési technológiákat még a szegényebb országoknak is (Rodrik 2018). Rodrik (2018) kutatása azt mutatja, hogy a gyáripar politikától, intézményektől és földrajzi helyzettől függetlenül évente körülbelül 3 százalékos ütemben zárkózik fel a technológiai határokhoz. Egy olyan országban, ahol az egyéni lehetőségek viszonylagos szabadságával rendelkező dinamikus gazdaság működik, gyorsabban zajlanak a technológiai változások, és a régebbi iparágakból származó vagyoni eszközöknek a fiatalabb iparágak gyorsabb növekedése miatt szinte elkerülhetetlenül csökkenő arányú súlyuk van a teljes vagyonban. ...
Az elmúlt években az éghajlatváltozás és a világjárvány miatt előtérbe került az egyenlőtlenség és a gazdasági növekedés kapcsolatának kérdése. Esszémben ezt a kapcsolatot vizsgálom, fő kérdésem, hogy az egyenlőtlenségek pozitív vagy negatív hatással vannak-e a gazdasági növekedésre. A témát a jövedelemegyenlőtlenségen keresztül közelítem meg, és nem törekszem az egyenlőtlenség minden aspektusának kibontására. A fogalmi keretekből kiindulva bemutatom a globális egyenlőtlenség és a hosszú távú növekedés közötti kapcsolatot. Mivel az egyenlőtlenségek a fejlett és fejlődő országokat egyaránt érintik, összehasonlítom őket, majd rámutatok arra, hogy utóbbiak miért nem tudják megismételni azt a gazdasági fejlődést, amely a korábban iparosítóknak sikerült. Végül megfogalmazom, hogy az egyértelmű cél a túlzott egyenlőtlenségek mérséklése lehet.
... However, critics of the neoliberal model argue that the rapid and far-reaching liberalization of the tradeable sector was undertaken with little or no regard to its negative impact on domestic industry, employment, and the environment; moreover, they contend that the removal of restrictions on the remittances of profits and dividends has generated in recent years a growing reverse flow to parent companies which has become a significant constraint on the balance of payments; in addition, they point out that the removal of local content requirements limits the ability of domestic firms to supply intermediate inputs to TNC's and thus partake in the process of "learning-by-doing" (see Chang, 2008;Cypher, 2014, 527-572;Ffrench-Davis and Agosin, 1999;Rodrik, 2018;and Weisbrot, 2015). Only time will tell if these market-based reforms are sustainable in the long run, particularly in the wake of recent economic and financial crises that have buffeted the region, as well as the current COVID-19 pandemic. ...
... For example, countries that exhibit a greater degree of political and macroeconomic stability, the existence of well-defined and enforceable property rights when it comes to the transfer of technology, liberal legislation governing the remittance of profits and dividends, and limited or non-existent local content or export requirements tend, on average, to attract greater flows of FDI. However, from the standpoint of the host country, the very factors which act as an incentive for FDI flows in the short run may prove detrimental to long-term economic development if they lead to a net outflow of resources, few backward and forward linkages, and limited transfers of technology and managerial knowhow (see Blomstrom and Wolff, 1994;Cypher, 2014;Rodrik, 2018;and Yeager, 1999). ...
... The importance of these net inflows is more fully appreciated by focusing on their evolution relative to their countries' gross fixed capital formation, since they are viewed as a source of investable resources to the host nation. Figure Critics of FDI , however, contend that instead of increasing the investable resources of the host nation, FDI flows divert resources away from capital formation because they generate a substantial reverse flows in the form of remittances of profits and interest to the parent companies, as well as through the widespread practice of intra-firm transfer pricing (see Chang, 2008;Cypher and Dietz, 2003;Cypher, 2014;Figueroa, 1998;Plasschaert, 1994;Ram and Zhang, 2002;and Rodrik, 2018). In their view, in order to assess the net contribution of FDI to the financing of private capital formation, one must first deduct from gross (or net) FDI inflows the repatriation of profits and interest to the parent companies, often residing in the U.S. for many of the countries in question. ...
This paper examines some of the major economic and institutional determinants of foreign direct investment (FDI) flows to Chile during the 2000s. It reports econometric results which suggest that standard economic variables and major changes in the institutional-legal status of foreign capital are, in large measure, responsible for the rapid increase in FDI flows to leading sectors of the Chilean economy. Cointegration analysis in the presence of structural breaks and FMOLS estimates for the 1970-2016 period suggest that market size, the real exchange rate, the debt-service ratio, education, physical infrastructure, and the Fraser Institute’s economic freedom index are economically significant in explaining the variation in the stock of net FDI to the country. Dummy variables, designed to capture qualitative factors such as the impact of economic crises and institutional reforms, are also included and they have their anticipated signs and are statistically significant. The paper also addresses the long-term negative effects of rapidly growing profit and dividend remittances on the financing of capital formation and the Chilean balance of payments in recent years.
... Therefore, a broader aim of the paper is also to stimulate the theoretical debate around the explanation of flows of goods in an era of post-GATT/WTO regimes of trade liberalization and increasing concerns about the process of globalization (see e.g. Cuervo-Cazurra et al. 2017, 2020, Evenett et al. 2022, Kobrin 2017, Meyer 2017, Milanovic 2016, Rodrik 2018. ...
... The recent changes in international political economy are undermining the previous long process of globalization (cf. Cuervo-Cazurra et al. 2017, Kobrin 2017, Meyer 2017, Milanovic 2016, Rodrik 2018. Whereas multilateral trade talks are more or less at a standstill, bilateral FTAs flourish. ...
... The initial focus on import substitution industrialization (ISI) aimed at self-sufficiency by replacing foreign imports with domestically produced goods, as seen in Latin America and parts of Africa during the mid-20th century. However, this approach often led to inefficiencies and economic stagnation due to lack of competition and over-reliance on protectionism (Irwanshah et al., 2016;Rodrik, 2018). In contrast, the success of export-oriented industrialization (EOI) in East Asian economies like South Korea and Taiwan highlighted the benefits of integrating into global markets, emphasizing competitive exports and leveraging global demand to drive growth (Felipe, 2019). ...
Malaysia’s economic development strategies have evolved significantly since independence, focusing on reducing poverty, enhancing education, and integrating technology to foster sustainable growth. Despite substantial progress, challenges persist in achieving inclusive development across rural and urban sectors. This study examines the effectiveness of Malaysia’s New Economic Model (NEM) in addressing poverty and unemployment through technological and educational advancements. Employing a qualitative approach, it reviews literature on technology’s impact on economic growth, poverty alleviation, and the role of tertiary education in national development. Analysis reveals that while NEM initiatives have attracted foreign investment and improved infrastructure, gaps remain in educational access and technological self-reliance. The findings underscore the need for targeted policies that enhance educational outcomes, promote inclusive technology adoption, and address structural inequalities to achieve sustainable economic development. Recommendations include bolstering vocational training, enhancing rural infrastructure, and fostering public-private partnerships in technology innovation to ensure equitable economic progress.
... The euro crisis caused damage to European democracy (Rodrik 2018). It undermined trust in the European project, weakened centrist political parties and strengthened the more extreme political parties. ...
The objective of this paper is to find out the past, the present and the future of the euro. The first part presents the euro as an edifying currency experiment. The second part analyses the economic performance of the euro area. The third part points out the internal conflicts inside the eurozone. The fourth part explains why the eurozone is not an optimum currency area. The fifth part outlines the controversy around the purchase of bonds by the ECB. The sixth part poses the question whether it is still possible to save the euro. The eurozone is not an optimum currency area. In theory, it could become one, provided that high mobility of labour is achieved, wages are flexible downwards, asymmetrical shocks do not occur and there is a stable system of national finances, supplemented by an effective system of fiscal compensations. Since these conditions are not met, the euro has become a trap for the member states. The euro has not had the effect of converging economic development in the eurozone; quite the opposite, it has had a diverging effect.
... Bár mindig is küzdenie kellett a társadalomnak a munka fluktuációjával járó munkanélküliséggel, a nagy történelmi forradalmak hosszútávon és összességükben mindig pozitív hatással bírtak a nemzeti társadalom egészére, és mindig találtak a társadalom többségének tennivalót, nem következett be globális munkanélküliségi válság (Rodrik, 2018). ...
A tanulmányban a technológiai fejlődési korszakok és a foglalkoztatottsági struktúrák kapcsolatának vizsgálatára kerül sor. Történelmi távlatból figyelhetjük meg a 20. század végéig végbement modern ipari forradalmakat és az ezek által kiváltott foglalkoztatottságbeli változásokat. Kiemelten foglalkozunk a 21. században zajló, mesterséges intelligencia kutatások eredményeképpen születő innovációkkal, illetve azok, elsősorban a középosztályt érintő, foglalkoztatottsági kérdéseivel, lehetséges hatásaival. Végezetül több szakmabeli által megfogalmazott lehetséges kimenetel és javaslat megfogalmazására is sor kerül.
... In fact, South Korea and Taiwan achieved supper-past export growth in the 1980s in a hostile international environment with high tariffs and quantitative restriction in most destination countries. Broader unilateral reforms with emphasis on export orientation were the key to their export success (Rodrik, 2018a). In any case, as noted above, the available evidence suggests that only a small share of Asian countries' trade occurs under the existing FTAs: FTAs are mostly ‗window dressing'. ...
Exposure to traumatic events gives people post-traumatic conditions which result in Post-Traumatic Stress Disorder (PTSD) and Post Traumatic Growth (PTG) which is optimistic rising right through the trauma in the opposite direction. Some of them may reports Acute Stress Disorder and some may have many grievances with the loss of closed one. However, most people overcome their traumatic condition by using their Emotional Intelligence and Resilience capacities. Three different models have been discussed which can explain the process of overcoming trauma using the emotional, resilience, and coping competencies. This paper focuses on basic mechanisms and resources which can be used to achieve a better rehabilitation along with Emotional Intelligence and resilience capacities with using different kinds of literature and models. Some findings to have been discussed of a study done among university students from Germany and Sri Lanka related to trauma coping.
Given the need to strengthen responses to the growing challenges posed by climate change, the purpose of this paper is to explore innovative approaches and interdisciplinary perspectives for tackling these issues, focusing on the role of the institutional framework, emerging technologies, and the necessity to also encourage the involvement of small-scale actors (such as citizens). The main approaches of this paper involve, first, the technological developments spurred by the necessity to effectively address climate change problems, emphasizing macro-level dimensions in terms of the political economy of green transition and the technological components of climate solutions. Parallel to that, it provides results and presents key elements of the legal context that promoted the sustainable transition, such as the establishment of a science-based policymaking process, the development of scientific data and tools, and efforts to encourage the participation of all relevant actors in sustainable economic development. Against this background, this paper puts forward the idea that a combined approach is required to address climate change issues, integrating top-down, e.g., macro-policy approaches with bottom-up strategies (with the latter allowing for a more dynamic participation of citizens and individuals), in order to complement current institutional, legal, policy, and technological measures. The result of the analysis is that this paper provides evidence for the introduction of guidelines strengthening macro-economic approaches in addition to the concept of a “science citizen” as a major component of new problem-focused solutions. The principal results and findings offer interpretations and insights while encouraging further discussion on transitioning to a sustainable science society. In this context, the analysis results elucidate that there is evidence for an increased policy emphasis on technology development (economy-based approaches) rather than on technology diffusion and assessment, and/or the integration of key small-scale actors, such as citizens. Thus, this paper provides evidence for the need to incorporate “science citizens” as a key parameter into the technology and innovation chain (e.g., data provision) and the public policy domain. Overall, this paper outlines a holistic analysis of the international economic, technological, institutional, legal, and policy environment regarding innovation, sustainability, and the climate crisis.
Since the 1990s, the importance of Information and Communications Technology (ICT)-enabled services/digitally deliverable services has steadily increased along with economic globalization. Until now, the driving force of the world economy has been world trade, mainly in goods. The digital economy has now arrived, with finance, telecommunications, software development, Business Process Outsourcing (BPO), and other service transactions becoming increasingly important, and Artificial Intelligence (AI) and big data becoming the greatest source of competitiveness. On the one hand, this economy has opened the way for some emerging and developing economies to develop through ICT and computer-based digital-based services trade, bringing great expectations to some emerging and developing economies. On the other hand, it has created increasingly difficult catch-up barriers for many developing countries. This chapter identifies the ICT-based services trade that has been the focus of much attention at the turn of the century, and refers to some of the key issues related to the development of emerging and developing economies that have been the subject of much discussion. At the same time, it examines the possibilities and challenges for the development of emerging and developing economies opened up by the development of ICTs.
This article explores the complex relationship between state aid and the evolution of economic environment, with a particular focus on the competitiveness of the regions where the aid beneficiaries activate. Many economic theories and ideas discuss the impact of state involvement on economic growth, emphasizing that excessive intervention can result in inefficiencies and distortions. However, targeted and strategic aid has the potential to stimulate economic growth, promote innovation, and address market failures. The paper compares EU regions with a high Competitiveness Index to those at the bottom of the competitiveness list, examining the volume and nature of aid provided to companies in these regions. The aim is to determine whether a direct relationship exists between aid and competitiveness. The findings generally confirm the previous research highlighting the beneficial effects of state aid on businesses' competitiveness, but with some original findings. We discovered that state aid supports the competitiveness of the beneficiaries, but some types of aid are more appropriate to sustain a company and make it more competitive. State aid promoting training, research, development, and innovative activities and infrastructure has greater potential to help companies become more competitive in the present global market.
This paper examines the effects of globalization on nations, focusing on economic, social, and cultural dimensions. It analyzes the roles of protectionism and globalization in shaping consumer welfare and producer earnings through qualitative methods and the Customs Union theory framework. The study discusses the benefits and drawbacks of globalization in the context of World Trade Organization (WTO) regulations. The findings indicate that globalization has intensified financial flows between countries, which can exacerbate economic crises. Countries with abundant human resources can capitalize on the international division of labor to specialize in high-value sectors, while those with limited resources risk falling behind in the digital landscape. This division of labor fosters specialization and improves production efficiency through targeted education. However, multinational corporations often impede cost-effective production in developing nations, underscoring the necessity to restructure research and development to facilitate technology adoption in underdeveloped areas. This restructuring can help close the technological gap and encourage equitable participation in the global economy. Jel code Classification: D6: Welfare economics, Fo1 Global outlook, F40: General F4: Macroeconomics aspects of international trade and finance
The coal sector has the highest share and contribution to the economy in East Kalimantan Province. The importance of the existence of coal to the economy of East Kalimantan must be followed by high competitiveness and supportive policy direction. For this reason, this study aims to measure and identify the competitiveness and factors that affect the output of the coal sector in East Kalimantan Province using the competitiveness analysis (LQ) method and panel data regression. The results of the analysis identified that East Kalimantan occupies the first position with the highest coal sector competitiveness in Indonesia. This is evidenced by a consistent competitiveness index value of more than 1 from 2021 to 2024. Meanwhile, the results of the panel data analysis also identified that the variables of total investment and the number of workers in the coal sector with long roads are estimated to have a positive and significant effect on the output of the coal sector in East Kalimantan Province. Meanwhile, the road length variable is predicted to have a negative and significant effect on the output of the coal sector.
The Indo-Pacific concept grew out of a movement to refocus and redefine the Asia-Pacific region to include the Indian Ocean and South Asia, largely as a result of China’s rise. Over the past 10 years, an increasing number of Indo-Pacific strategies have been officially released in the region and beyond. The first question this article tackles is the following: What are the key drivers behind the rise of Indo-Pacific strategies? We argue that Indo-Pacific strategies have become a fast-moving experimenting space for countries searching for adjustment strategies to at least two concurrent deep trends in a changing global order: the great recent shift in the balance of power most vividly characterized by an increasingly assertive China, and the peaking of the liberal globalization experiment and the return of economic security to the fore. We are also concerned with the comparative angle to this question. In particular, how do Indo-Pacific strategies vary among key countries? And finally, how does the Canadian strategy fit within the broader landscape of Indo-Pacific strategies? In answer to these questions, the article develops a typology of existing Indo-Pacific strategies and how they each insert themselves in the current transitionary stage. Finally, we turn to Canada’s own Indo-Pacific strategy and its key features and drivers, including a discussion of Canada’s approach vis-à-vis China. We argue that this represents a touchstone in how Canada is responding to great power shifts and the erosion of the liberal international order.
This study investigates the impact of globalization on translation practices and the demand for translators across various industries. Utilizing a mixed-methods research design, the study combines quantitative surveys and qualitative interviews with professional translators, translation agency managers, and industry experts. The findings reveal that technological advancements, particularly machine translation (MT) and computer-assisted translation (CAT) tools have significantly altered translation workflows, increasing efficiency while necessitating careful quality control. The demand for localization services has surged, especially in the tech industry, reflecting a broader trend towards culturally adapted content in global markets. Additionally, the study highlights a notable shift towards freelancing and remote work among translators, driven by the desire for flexibility but accompanied by challenges such as job stability and securing consistent work. Emerging challenges identified include maintaining translation quality amidst high workloads, adapting to rapidly evolving technologies, and navigating cultural differences to ensure culturally appropriate translations. Economic pressures, such as low rates and payment issues, further complicate the landscape for professional translators. These findings align with existing literature, emphasizing the need for continuous adaptation, professional development, and strategic approaches to address the dynamic and evolving nature of the translation industry in a globalized context. The study provides valuable insights into the current state of the translation industry, highlighting the importance of cultural competence, technological proficiency, and economic resilience for translators operating in a globalized world. Future research should explore the long-term impacts of these trends and the evolving role of translators in a rapidly changing global market.
This multidisciplinary paper contributes to political economy, social cybernetics, and philosophy by examining distinctions in market capitalist ideologies through a metacybernetic approach. It explores reflexive processes, akin to Adam Smith’s invisible and visible hands, and their impact on market ideologies. The study highlights the evolutifon of these ideologies in balancing egoism and altruism, revealing insights into sociocultural shifts. Some ideologies are more prone to pathologies like market hegemony, which disrupts market viability and social welfare. Diagnosing these ideologies is essential to address issues of market hegemony like platform capitalism, technofeudalism, and surveillance capitalism. After a comparative analysis of capitalist ideologies, the paper focuses on neoliberal and stakeholder capitalism, due to their dominance, contrasting philosophies, policy influence, and roles in global challenges. A metacybernetic perspective is adopted, modelling the market as a complex adaptive system with agency, using Mindset Agency Theory (MAT). MAT distinguishes agency into subagencies of affect and cognition. Recognising the role of spirit, a spirit subagency is configured into MAT to enable explicit consideration of attributes like ethics and the greater good within the market, relationally improving transparency and promoting sustainable and inclusive economic practices. MAT is applied to the evolution of capitalist ideologies, examining their viability and sustainability under changing conditions. With its now triadic interactive subagency structure, MAT identifies eight distinct types of mindset, each characterised by 21 parameters that combine to deliver unique variations, in neoliberal and stakeholder capitalism, of the market ideologies.
There are many jokes about economists and most economics students will know at least a few. Economists often laugh at themselves as well and for a period of time the annual meeting of the American Economic Association set up a talk show to give economists the chance to let off steam and mock the profession. One of the jokes goes like this: a physicist, a chemist and an economist are adrift on an isolated island. While sitting at the shore, they find a can of food that floated in from the sea. On discussing how to open the can, the physicist suggests that they can use pressure exerted from rocks to break it open. The chemist chimes in and suggests that they can use heat from a wood fire to heat the can, so it expands and bursts. Finally, the economist gives a solution, “suppose we had a can opener…”.
The COVID-19 pandemic was one of the first “black swan” for the global economy. Regional authorities in Russia were faced to support their regional economies but they were faced with uncharacteristic independence. The issue of assessing the effectiveness of regional anti-crisis industrial policy measures in Russia during the COVID-19 crisis is becoming urgent. The purpose of this study is to search for the most successful measures of regional support in Russia during the designated period. The study is based on the conceptual framework of the St. Petersburg School of Industrial Policy. Descriptive statistics, cluster analysis, and correlation analysis are used as statistical methods of analysis. 1196 anti-crisis industrial policy measures were classified in all 85 regions of the Russian Federation. A scatter diagram of regions was constructed with indicators of the scale for assessing the intensity of the anti-crisis industrial policy and the scale of the impact of the crisis on socio-economic indicators. Four clusters were identified: (1) regions that practically did not implement an anti-crisis industrial policy and suffered during the crisis; (2) regions that have significant economic stability and are less likely to resort to active anti-crisis policies; (3) regions, the values of indicators of the dynamics of socio-economic indicators of which are at an average and below level, but are pursuing, on average, a more intensive anti-crisis policy; (4) regions that pursued an active anti-crisis industrial policy and achieved good socio-economic indicators. Correlation analysis did not reveal a stable connection between the intensity of the anti-crisis policy and the crisis dynamics of socio-economic indicators. The study also presents leading regions and outsider regions in terms of anti-crisis industrial policy measures for each of the 4 clusters.
This study aims to examine the impact of foreign trade and foreign direct investment on Nepal’s long-term economic growth. It uses secondary data from 1989/90 to 2021/22 collected from various economic surveys of the Ministry of Finance of Nepal. Descriptive and explanatory research designs are used in this study. The trace, max-eigen tests, and fully modified least square methods search the long-run co-integration and impact between response and predictor variables. Trace and max-eigen tests consistently point toward the long-run co-integration between dependent (gross domestic product) and independent (import, export, total trade, and foreign direct investment) variables. Exports and imports are found to be negative and statistically significant to explain Nepal’s economic growth. One unit increase in exports results in a 0.748 unit decrease in Nepal’s economic growth. Similarly, total trade volume and foreign direct investment positively impact economic growth. Each unit increase in foreign direct investment results in a 0.0036 unit increase in GDP in Nepal. Foreign trade has a multiplier effect on Nepal’s GDP growth. The 76.35 percent variation in economic growth depends upon total foreign trade volume, exports, imports, and foreign direct investment. To promote sustainable economic growth, policymakers should prioritize policies encouraging increased total foreign trade and foreign direct investment while carefully managing the potential negative impact of excessive reliance on import dynamics.
BACKGROUND
Many studies are focused on traditional (old) or modern (new) industrial policy. There are insufficient studies linking the emergence of the knowledge economy and the institutional requirements to underpin inclusive social and economic development in developed or developing countries.
OBJECTIVE
This study aims to analyze the characteristics of the knowledge economy and the institutional requirements for more inclusive and sustainable socio-economic developments. Constraints of the international economic law in its current form for more inclusive and sustainable industrial policy in developed and developing countries will be put forward. The inclusive knowledge economy requires not only innovative advanced firms but also innovative and creative public sector employees capable of supporting and disseminating opportunities of the knowledge economy to the entire society. Moreover, the inclusive knowledge economy requires lifelong learning processes of the workforce in developed and developing economies. Therefore, a human dimension, broad participation, and shaping of modern development strategies a key to developing an inclusive and sustainable knowledge economy. Institutional constraints of the international economic framework are currently not adequately supportive of such a structural shift. The objective of this study is to show the possible adjustments at the international and national levels to support the development of an inclusive knowledge economy. The human dimension (participation, creativity, imagination) of the public and private sector goes hand in hand with institutional innovations.
METHODS
The normative and institutional analysis, embedded in the historical context of industrialization patterns in the selected countries, will provide insights into the institutional requirements for an inclusive knowledge economy.
RESULTS
The result of the conceptual and normative as well as empirical comparative analysis will provide insights into the possibilities and needs for institutional innovations at the regional, national, and supranational levels of polity while embracing the need for a more supportive international normative context. Several possible institutional innovations at the national levels, such as regional public venture funds, decentralized support, and training centers, are provided. A reform of the Agreement on Subsidies and Countervailing Measures to better delineate between potentially productive and harmful subsidies at the international level can be seen as a reform proposal at the international level.
CONCLUSIONS
Industrial policies in developed and developing countries will not be able to address the social and economic divides between advanced and stagnating sectors of the economy without addressing the requirements for institutional innovations at all levels of the international polity.
Dichotomisation between winners and losers is a prominent element of the
debate on globalisation, with ordinary workers often considered losers.
However, little is known about what workers make of globalisation, how they
experience the phenomenon, and how they talk about it. We use a set of
focus groups to explore meaning-making on the globalisation of the
economy among lower-educated employees of Dutch internationalised firms.
We find that they weigh up the pros and cons and proudly struggle with the
consequences of globalisation. To the degree that they feel left behind, it is
by politics and government. This suggests that dislike of globalisation is the
result of negative experiences with politics, rather than the other way around.
This paper draws on an institutional typology to systematically compare China’s Belt and Road Initiative and the US-led Build Back Better World (B3W) by examining institutional strength, actor scope, geography, partner size, sectoral coverage, nature, and aggregate monetary value. I argue that, in contrast to orthodox institutions that are bodies of multilateral or minilateral arrangements with binding rules and procedures, both the Chinese and US initiatives are pseudo institutions. The analysis finds that both the Belt and Road Initiative and the Build Back Better World are global liberalizing initiatives, and all countries are welcome to join, but their institutional strength is weak, and their partner size has been small. For sectoral coverage and aggregate monetary value, the Chinese initiative surpasses the US-centric one. In addition, both initiatives operate as hub-and-spoke arrangements.
The evolving research field of social studies of economics (SSE) has shown that economics as a profession has gained influence on public debate and political power in many countries and in different social contexts. The channels of influence for economists are complex and widespread, i.e., there are multiple channels through which economists are able to influence public policy issues. In this article, we provide an in-depth analysis of a sample of the 85 most published authors of trade-related research in top economics journals to characterize the social field of elite economists and show how position in that field correlates with influence and power in and outside academia. More specifically, our data include information on their academic careers, their professional social networks, and their involvement in a variety of possible intermediaries between academic economics and policymaking (e.g., institutions such as think tanks or the media). We apply multiple correspondence analysis (MCA) and cluster analysis to show how different configurations of intra-academic capital are associated to policy-relevant extra-academic capital. The overall results of this analysis are threefold. First, the biographical analysis of elite trade economists reveals a remarkable degree of concentration of different forms of capital, which indicates a strong hierarchical order within the elite segment of trade economists. Second, and in line with this, despite the overall unequal distribution of capital within this elite sample, different forms of intra-academic and extra-academic capitals become visible. Third, while the cluster analysis reveals a main “average core” of (trade-)policy-oriented economists, the group of economists with very high capital is separated into two smaller clusters: The “ivory elite” cluster consists mainly of academic capital variables, while the “public econs” cluster is also composed of non-academic variables from the policy and media channels. So, even among elite trade economists, it is only as small number, who really is successfully gaining political and societal impact.
Despite increasing calls on the state to manage major challenges, in the existing literature, the state – and public sector activities more generally – tends to be overlooked as an agent of regional change. The role of public sector jobs is often taken for granted, with diverse empirical findings being strongly influenced by geography and time period, if they are considered at all. We discuss two main threads of research on contemporary public sector employment that could enhance our understanding of the role of the public sector in regional development (i.e. human capital formation and diversification).
The Chinese central government has greatly supported two strategic high-tech industries: 5G and supercomputing. However, when both encountered similar U.S. sanctions, the 5G industry failed to make crucial upstream components while the supercomputing industry could. This article argues that the central government-level industrial policies contributed to these divergent outcomes. Using natural language processing and qualitative content analysis of meticulously collected official documents and secondary sources, key policy differences were identified. Before the U.S. sanctions in May 2019, China's 5G industrial policies were significantly unbalanced, with inadequate attention given to research and development of vital upstream components, contributing to a lack of upstream investment. Although recent attempts to rebalance 5G industrial development since 2021, the policy focus remains largely on the mid and downstream segments. In contrast, before the U.S. sanctions in 2015, the supercomputing industrial policies emphasised the development of the entire industrial chain, including crucial upstream components, resulting in China's possession of entirely homegrown supercomputers. Leveraging a tri-level analysis framework rooted in political economics, this study also offers possible explanations for the policy divergence and discusses implications. It contributes to the existing literature and ongoing debate on China and industrial policy amidst great power high-tech competition.
In other chapters, it has already been discussed to what extent international organizations, networks and NGOs have driven or limited globalization, that is, how they have acted as additional actors in the emerging complex world governance, which is now commonly referred to as ‘global governance’. What this global governance means, which international, state, societal and private actors are involved, why they should be involved and why governmental networks or organizations are no longer sufficient to cope with the increasingly complex problems of world governance, has been discussed over and over again, so it should only be summarized in the shortest possible way. It is less common to have an overview of how this world governance has been expressed in possibly sectorally different institutional forms and which problems, which have arisen or at least aggravated by the world economic and world social intertwinement, have been identified and—also or not—tackled.
Recent evidence from citation analysis (Mitra et al., World Dev 135:105076, 2020) suggests that research published in top economic journals is becoming more influential in the development discourse. In this article, we argue that this trend has nontrivial implications for the development discourse on trade in general. Based on an analysis of more than 400 papers published in high-impact economic journals between 1997 and 2017, we highlight three core trade narratives that stand for different biases apparent in the elite economic discourse on trade: “trade championing”, “Ignorance in a world full of nails” and “microfounding trade benefits”. Further insights derived from citation analysis of five development studies journals and a case-study-oriented approach that focusses on the reception of this particular trade debate in World Development suggests that these biased trade narratives are effectively transmitted into development research.
The notion of international development has evolved giving new meanings to the discipline of development economics. This evolution has been the product of the flux in the global economy affecting both ‘developing’ and ‘developed’ countries. Three broad areas of concern are: First, the extent to which there is any type of consensus around which ‘current issues’ are most important—and why. Second, whether there is any consensus about the analytical methods which are appropriate for an understanding of the main characteristics of the ‘issues’ within economics or ‘political economy’. Third, whether there is any consensus about the nature of economic policies (and strategies) which can be used to address these issues effectively. There is need for a heterodox lens to address the mega-questions that both developed and developing countries will have to contend with in the next few decades: climate change; issues of development financing and cooperation; artificial intelligence, innovations and the world of work; pandemics and public health; population, migration and demographic dividends; human rights and (de)globalisation.JEL KeywordsB17—International Trade and FinanceB51—Historical, Institutional, Evolutionary, Modern Monetary TheoryC82—Methodology for Collecting, Estimating and Organising Macroeconomic DataO1—Economic DevelopmentO2—Development Planning and Policy
Populist rejection of the embedded liberal international order is evident in many Western democracies. This is partly attributable to the architects of this system, who over-promised widespread benefits while ignoring warnings from labour and fair-trade advocates about risks to economic security from transnational economic competition. This article contrasts Canadian and American conservative populist positions on free trade. Globalisation and free trade without consideration for fair trade weakened the embedded liberal compromise and undermined the Keynesian welfare state model which sustained it. While regional free trade agreements like the North American Free Trade Agreement have had marginal negative effects, they became convenient scapegoats in a strategy of “othering” adopted by Trump and other populists. Populism arose in part in response to middle- and working-class decline (alongside cultural changes and revitalised nativism), which eroded support for embedded liberalism. The heretofore pro-trade GOP followed Trump to a more protectionist and bilateral model to press for “America first,” tinged by nativist othering towards Mexico and China. This diverged from Canadian right-populist leaders, whose rhetoric generally supports freer trade despite scepticism among some supporters. Asymmetrical circumstances of the US as a global economic hegemon vs. Canada as trade-dependent middle power limits the feasibility of a protectionist, “Canada first” position while particularities of political and electoral systems create more room for nativism in the US. Polling results indicate support for free trade in both nations, with a priority for labour and social protections, which provides the potential for further engagement in progressive trade liberalisation. Hence a significant percentage of the population supports “fair-trade” approaches, not protectionism. However, many conservative politicians eschew fair-trade positions and endorse anti-labour policies. Despite gains such as the labour provisions in the Canada–US–Mexico Agreement, a right-populist alliance with fair-trade advocates and labour unions is unsustainable and would entail compromises like climate denial, anti-immigrant, and anti-equity approaches which hinder the pursuit of progressive multilateral trading regimes.
A classic statement of the pure theory of public finance was formulated circa 45 years ago by Richard Musgrave (Musgrave 1959 Musgrave, Richard. 1959. The Theory of Public Finance. New York: McGraw/Hill. [Google Scholar]). He conceptualized the role of public finance as falling into three primary functions of government: (a) to provide for public goods, (b) to provide for an equitable distribution of income, and (c) to stabilize the economy. In its simplicity, this tripartite division “has been invaluable” and remains the “gold standard” in economics to this day. But is something missing? The author argues that we badly neglect distribution.
Trade relations face unprecedented challenges, which led to an increased politicization and contestation of trade rules. In response, the EU has changed its trade policy under the motto ‘Open Strategic Autonomy’ towards a more assertive policy. The EU seeks to significantly expand its room of manoeuvre and to gain more autonomy by strengthening the enforcement of its trade rights and by ensuring more effectively, including unilaterally, a level playing field. This reorientation engenders several new or amended trade policy instruments, but meets with reservations as the renewed politicization of EU trade policy will have internal consequences and raise demands for more democratic accountability of the European Commission. The new policy instruments will enlarge its leeway in trade policy. The future of the EU´s multilateral, rule- instead of power-oriented political stance becomes unclear, which might undermine its negotiation position in WTO reform and collide with the EU´s respect for international law. The tensions of the EU´s new hybrid approach with its international commitments even more fuel demands for increased accountability of the Commission as a safeguard against employing the new powers for protectionism and disrespect to international law. The contribution analyses the need for increased Commission accountability in the redirected trade policy.
This chapter identifies declining public trust and the advance of a politics of cultural resentment in many “advanced” democracies as problems to which statecraft must urgently attend. We leverage the experience of the interwar period and the writings of three of its most important interlocutors—Karl Polanyi, John Maynard Keynes, and E.H. Carr—to direct analysis of the contemporary condition to a broader set of uniquely psycho-social and cultural dynamics. These dynamics have been overlooked by political economists who have sought explanations for political disaffection in the economic dislocations wrought by globalization, deindustrialization, and automation. We identify sentiments ranging from disillusion to defiance that are now fueling a runaway politics narrowly defined around race, ethnicity, and national identity. Drawing parallels to assessments of the interwar period, we argue that today’s resentment politics is not the product of economic hardship or even institutional failure alone, but emerges also from a breakdown of the social and cultural ties that underpin liberalism—a “delicate order” built in part on sublimated psycho-social understandings of agency and community. Statecraft must therefore necessarily concern itself with issues of rank, status, and security—an agenda that goes well beyond economistic renderings of the public purpose that now predominate discussions of politics and policy.
This chapter establishes the political negotiation of the public good or common benefit as an indispensable practice of statecraft. We argue that the field of Political Economy must support the advance of political knowledge essential to the public negotiation of collective ends and aspirations. We leverage the work of John Kenneth Galbraith to argue that reviving statecraft requires both a theory of power and a facility with ideas often absent in contemporary analyses of national and global economies. Contemporary statecraft must attend to predicaments of power as they impact ordinary people, and political economists must therefore be attuned to politically destabilizing and socially disruptive forms of power that threaten to fragment and disintegrate what remains of the public purpose.
Der Außenhandel gilt nicht zu Unrecht als die früheste und wohl immer noch bedeutendste Facette einer stärker werdenden, internationalen wirtschaftlichen Vernetzung. Lange Zeit blieb er gemessen am globalen Sozialprodukt recht gering, konzentrierte sich – wegen der früher hohen Transportkosten – im Wesentlichen auf Luxuswaren mit geringem Gewicht im Verhältnis zum Marktpreis. Das hat sich ab Mitte des 19. Jahrhunderts deutlich verändert; bis zum Ausbruch des 1. ???
In anderen Kapiteln wurde bereits erörtert, inwieweit Internationale Organisationen, Netzwerke und Nichtregierungsorganisationen die Globalisierung vorangetrieben oder begrenzt haben, wie sie also als zusätzliche Akteure eines sich herausbildenden komplexen Weltregierens agiert haben, das heute gemeinhin als ‚Global Governance‘ bezeichnet wird. Was diese Global Governance bedeutet, welche internationalen, staatlichen, gesellschaftlichen und privaten Akteure daran beteiligt sind, warum sie beteiligt sein sollten und gouvernementale Netzwerke oder Organisationen allein nicht mehr ausreichen, um die komplexer werdenden Probleme des Weltregierens zu bewältigen, wurde wahrlich oft genug erörtert, soll also nur in äußerster Kürze zusammengefasst werden. Seltener gab und gibt es einen Überblick darüber, wie sich dieses Weltregieren in möglicherweise sektoral jeweils unterschiedlichen institutionellen Formen ausgeprägt hat und welche Probleme, die durch die weltwirtschaftliche und weltgesellschaftliche Verflechtung entstanden oder zumindest verschärft wurden, dabei identifiziert und – auch, oder auch nicht – angepackt wurden.
From unemployment to Brexit to climate change, capitalism is in trouble and ill-prepared to cope with the challenges of the coming decades. How did we get here? While contemporary economists and policymakers tend to ignore the political and social dimensions of capitalism, some of the great economists of the past - Adam Smith, Friedrich List, John Maynard Keynes, Joseph Schumpeter, Karl Polanyi and Albert Hirschman - did not make the same mistake. Leveraging their insights, sociologists John L. Campbell and John A. Hall trace the historical development of capitalism as a social, political, and economic system throughout the twentieth and early twenty-first centuries. They draw comparisons across eras and around the globe to show that there is no inevitable logic of capitalism. Rather, capitalism's performance depends on the strength of nation-states, the social cohesion of capitalist societies, and the stability of the international system - three things that are in short supply today.
In this article we discuss the need for industrial policy and role of development banks for economic development. The catching-up of countries in the Global South to productivity levels and living standards of the Global North is the exception. There are two main economic explanations for this observation. First, developing countries are pushed to low-tech and labor-intensive productions and tasks in global value chains. This offers the advantage of easier industrialisation, but it does not automatically lead to productivity levels comparable with the Global North. Foreign direct investments only partially help to overcome this problem. Second, low trust in national currencies in the Global South leads to distorted financial markets which do not provide sufficient credit for investment. National development banks play a key role in facilitating the economic catching-up of the Global South as part of needed industrial policies. They can alleviate distortions in the financial system and at the same time support the transformation of the economy towards higher productivity and ecological transformation. We explain development bank policies by using the KfW as an example of an effective industrial policy.
This article contributes to the debate on the role of normative values and political preferences among (publicly visible) economists in the United States. For this purpose, we conduct a social network analysis on the signatories of economist petitions, which we identify as one channel for economists to exert public influence. Our contribution is twofold: On the one hand, we provide an extended empirical basis for the debate on consensus in economics and the role of political preferences and normative values in economics. On the other hand, this article offers a viable tool to trace the normative charging of (prospective) economist petitions and economists based on the social structure of petition networks. The main empirical finding of our article is that there is a very strong partisan divide among petition-signing economists in the United States, which mirrors the cleavage within the U.S. political system. We also find that the bipartite partisan structure of the economist petition network increases with the political involvement of economists. This divide is particularly stark in the field of fiscal policy. A greater tendency towards consensus, in turn, can be found with respect to monetary policy, carbon pricing, immigration, free trade or market-based decision tools in general.
After more than thirty years of post-war relative regional convergence, since the 1980s geographical inequalities in economic prosperity and social conditions have widened again in most capitalist countries. In this paper we argue that this resumption of spatial inequality is in part explained by the significant changes observed in the role of the state and in public intervention in the shift from the post-war ‘Keynesian’ regime of state regulation to the ‘Neoliberal’ regime that has held sway over the past four decades. We argue that most public policies enacted in this latter period have actually exacerbated socioeconomic – and spatial – polarization, favouring a few metropolitan areas and regions at the expense of a substantial number of what are now commonly referred to as ‘left behind places’. We contend that we are now at a new juncture in the evolution of capitalism: in the space of little more than decade the global system has been destabilized by a major financial crisis (2008) and the COVID-19 pandemic (2020), both with enduring socio-economic aftershocks, while the climate emergency is reaching existential proportions. In this Editorial Introduction we call for a bold ‘rethinking’ of public action - and especially spatial policy - to face these recurring crises, and we outline some pointers for more effective and inclusive policies.
China and the European Union (EU) signed the first international circular economy (CE) agreement shortly after China issued the ‘Waste Ban’ (WB) on the import of 24 categories of solid waste. While the WB gained global attention, limited research addresses its political implications for international CE. Based on 72 expert interviews, 52 documents and participant observation, we study political WB narratives and corresponding perceptions of ‘Chinese’ and ‘European’ agency in the China-EU case. Our results show a political gridlock in China-EU CE coordination: the main narratives on the WB diverge on the very roles and rules of CE cooperation, scales of implementation, and the assessment criteria for environmentally and socially sustainable CE(s). To enable fruitful CE cooperation, we suggest three critical points for reflection and negotiation: (1) overcome ‘student–teacher’ roles rooted in linear development that run counter to CE ideas; (2) reconsider the focus on international and national waste diversion, instead of local waste prevention, that propels global waste markets sustained by increasing waste volumes; and (3) evaluate both the benefits and impediments of (new) trade relations for a CE cooperation that contributes to environmental and social sustainability.
Like other countries with large ports, the Netherlands developed a policy narrative to acquire a key position in global value chains starting in the 1980s, through the spatial development of its hinterland logistics complex. The negative environmental effects of logistics, such as landscape transformation and congestion, have increasingly come to be seen as spatial policy problems. The literature on policy narratives emphasizes the importance of balanced trade-offs and learning from alternative views. In this paper, we discuss why the ‘Gateway to Europe’ narrative has remained in place. This paper systematically reviews spatial planning documents, advisory reports and academic papers between 1980 and 2020 to develop a chronology of logistics planning concepts pertaining to economic and technological milestones. It also maps policy influences, aiming to identify underlying causal policy theories on logistics development and its spatial-environmental effects. We determine that critical reports have been structurally ignored, challenges have been outsourced and advocacy coalitions have been unbalanced, increasing path dependency and risking a spatial-economic lock-in. Looking at the ‘Gateway to Europe’, we point to pitfalls in the policy narrative and the policy-learning process, enabling policymakers to avoid them in the future. © 2022 The Author(s). Published by Informa UK Limited, trading as Taylor & Francis Group.
Liberal globalism has reached its limits in the context of the climate and corona crisis. Criticism of globalization comes increasingly from the right. As a counter-model, these actors present the return to a capitalism with a nationalistic character, in which (selective) trade regulation to strengthen one's own market positioning (competitiveness) plays a central role. The progressive forces, on the other hand, are divided when it comes to their relationship to globalization. While some actors emphasize that global problems can only be solved globally, others focus on the local level as the central field of action. We differentiate ourselves from both positions and problematize the underlying “spatial fetishism”. As an alternative, we propose a strategy of planetary coexistence that cleverly utilizes the scope for action at different levels to enable a good life for as many as possible within planetary boundaries. At the local level, economic areas of everyday economy (health, housing, energy, etc.) as well as economic cycles (repair economy, regional food systems) can become small. At the national and EU level, industrial and fiscal policy offer progressive points of action, while at the global level the regulation of trade relations and the limitation of global financial markets are central. Our policy paper contains specific recommendations for action for different actors (social movements, administrations, decision-makers).
z Bu çalışma ekosistem pazarlama ile adil ve kapsayıcı ekonomi politik söylem arasındaki ilişkiyi dünya piyasasının değişen dinamikleri bağlamı içerisinde incelemektedir. Bu ilişkiyi ortaya çıkarmanın amacı, ekosistem pazarlama alanını anlamak ve netleştirmektir. Çalışma önce mevcut koşulları gözlemleyerek, daha sonrada böylesine karmaşık görüngülerin bu haliyle görünmesi ve işlemesi için nelerin gerektiğini çıkarsamaya çalışır. Ardından ekosistem pazarlama bilgisinin bütünselliğini ortaya koyar. Böylece, sözü edilen adil ve kapsayıcı ekonomi politik söylem ile ekosistem pazarlama alanında, ekonomiden siyaset bilimine, sosyolojiden etiğe kadar uzanabilecek disiplinler arası bir alanın keşfedilmesi hedeflenmektedir. Abstract This study examines the relationship between ecosystem marketing and fair and inclusive political economy discourse in the context of the changing dynamics of the world market. The purpose of revealing this relationship is to try to understand and clarify the ecosystem marketing field. The study first by observing the existing conditions then tries to deduce what is needed for such complex phenomena to appear and function as they are. Then it reveals the integrity of the ecosystem marketing knowledge. Thus, with the aforementioned discourse fair and inclusive political economy, it is aimed to explore to discover a transdisciplinary field that can extend from economics to political science and from sociology to ethics in the field of ecosystem marketing.
This book provides the first systematic analysis of new Asian regionalism as a paradigm shift in international economic law. It argues that new Asian regionalism has emerged amid the Third Regionalism and contributed to the New Regional Economic Order, which reinvigorates the role of developing countries in shaping international trade norms. To substantiate the claims, the book introduces theoretical debates and evaluates major regional economic initiatives and institutions, including the ASEAN+6 framework, APEC, the CPTPP and the RCEP. It also sheds light on legal issues involving the US-China trade war and the COVID-19 pandemic, as well as trade policies of Asian powers, the European Union and the United States. Hence, the legal analysis and case studies offer a fresh perspective of Asian integration and bridge the gap between academia and practice.
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