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1. ICT Beyond Borders: The Integral Role of US Tech in Europe’s Digital Economy

Author:
Matthias Bauer and Dyuti Pandya
Publication Date:
03-2024
Content Type:
Policy Brief
Institution:
European Centre for International Political Economy (ECIPE)
Abstract:
Contrary to political assertions about the vulnerability of digital services provided by non-EU companies, the strong presence and sunk costs associated with US tech companies’ investments in data centres, skilled workforce development, and research facilities in Europe act as significant barriers to exit, highlighting the inherent symbiosis between US tech investments and Europe’s digital and non-digital sectors. These investments underscore a mutual inter-dependency that strengthens European economies, making the notion of “sudden cessation” of digital services by US companies implausible. Corporate data show a significant investment gap of approximately USD 1.36 trillion between US and EU ICT companies, attributing a competitive edge to US firms due to their heavy investment in ICT, cloud solutions, and R&D. Forecasted increases in ICT investments by US corporations outline a benchmark beyond reach for EU businesses. The notion of EU firms aligning with this growth path is rather fantastical, as it would call for immense government investment, ultimately draining financial resources from essential public services, such as healthcare, housing, and environmental policies. Substantial ICT investments across EU Member States together with a long-term commitment to the European market present an opportunity for the EU to leverage US continuous technological advancements, underscoring the potential for transatlantic collaboration to drive the EU’s digital transformation and innovation. EU-US partnerships not only fuel the EU’s digital transformation but also align with shared political values, reinforcing the significance of transatlantic collaboration in shaping a competitive and innovative digital future.
Topic:
Communications, European Union, Digital Economy, Investment, and Information Technology
Political Geography:
Europe, North America, and United States of America

2. US-India Economic Ties: To the Next Level and Beyond

Author:
Aparna Pande
Publication Date:
10-2024
Content Type:
Special Report
Institution:
Hudson Institute
Abstract:
This executive summary outlines the key recommendations for policymakers that emerged from deliberations at the Takshashila Institution–Hudson Institute roundtable series “US-India Economic Ties: To the Next Level and Beyond.” Its recommendations are divided into four proposed areas for collaboration between India and the United States: trade and investment, ideas and human capital, technology, and methods and mechanisms.
Topic:
Economics, Science and Technology, Bilateral Relations, Investment, and Trade
Political Geography:
South Asia, India, North America, and United States of America

3. Buy Before You Build: A Decision Framework for Purchasing Commercial Space Services

Author:
Peter Cunniffe, Megan Lewis, and Bryan Clark
Publication Date:
10-2023
Content Type:
Special Report
Institution:
Hudson Institute
Abstract:
A recent wave of private investment in space creates new opportunities for government agencies to benefit from commercial innovation. Leaders of national security space acquisition organizations regularly express their intention to first buy commercial space capabilities and build government space systems only when they must.1 However, achieving greater use of commercial space services requires overcoming barriers that have thus far prevented the government from fully benefiting from private sector funding and creativity. This report assesses the increasingly wide range of commercial space services available to government agencies, identifies obstacles hindering greater use by the US government, and makes recommendations for overcoming them.2 While the report focuses on the US government use of commercial space services, its analysis and recommendations are relevant for governments of other space-faring nations.
Topic:
Defense Policy, National Security, Space, and Investment
Political Geography:
North America and United States of America

4. The Effects of the United States-China Trade War During the COVID-19 Pandemic on Global Supply Chains: Evidence from Viet Nam

Author:
Duc Anh Dang and Ngoc Anh Tran
Publication Date:
08-2023
Content Type:
Working Paper
Institution:
Economic Research Institute for ASEAN and East Asia (ERIA)
Abstract:
The trade war between the United States (US) and China has affected their bilateral trade as well as that with other countries. This study investigates how Vietnamese firms performed during the COVID-19 pandemic under the shadow of this trade war. The change in the log of Vietnamese exports to the US from 2017 to 2020 is used to measure the impact of the trade war, and the change in the log of Chinese exports to the US is then used as an instrument for the Vietnamese export change during the same period. It is found that firms that faced more trade war exposure increased their investment, profit, and value added, which may be due to the market exit of unproductive firms. Moreover, the trade war impact is more pronounced for large firms. Foreign-invested firms gained less from trade war exposure. The pandemic weakened the trade war effect on firm performances; however, it exacerbated the trade tension effect on foreign-trade firms.
Topic:
Bilateral Relations, Investment, Trade, and COVID-19
Political Geography:
China, Asia, North America, and United States of America

5. Effective Shareholder Engagement to Address the Food Sector’s SDG-Related Impacts in Mexico

Author:
Nora Mardirossian
Publication Date:
11-2023
Content Type:
Special Report
Institution:
Columbia Center on Sustainable Investment
Abstract:
Globally, there is growing investor engagement on environmental and social issues. Over 550 financial institutions participate in net zero alliances,1 the largest-ever number of ESG-related resolutions was filed in 2023 (over 500),2 and global sustainable fund assets hit nearly $2.8 trillion at the end of June 2023.3 Corporate sustainability reporting standards and regulations – many of which are international, have extraterritorial reach, or cover global value chains – have proliferated and are reinforcing the larger trend. Traditional investing has historically focused on mitigating financial risk without being cognizant of other important external risks. Sustainable investing takes a wider view that is explicitly interested in sustainability issues, but some approaches are more progressive than others. Some sustainability or ESG investment efforts focus on sustainability impacts only to the extent they are linked to or overlap with financial materiality. Some large institutional investors, particularly those considered to be universal owners, express an understanding that system-level issues like climate change, biodiversity loss, and inequality present risks to the entire economic system, and thus to their entire portfolios.4 Some mainstream investors have acknowledged they have a responsibility to manage severe environmental and social risks, in line with international standards.5 Other smaller and philanthropic funds use an impact investing strategy that focuses more on driving sustainability impacts, with a less explicit focus on returns.6 Rather than investment decision making (i.e., deciding what to invest in either by screening or excluding companies or entire sectors that are seen as high risk or by targeting investments in areas that have some kind of positive sustainability potential through impact investing), this report focuses on the more effective strategy for public equity investors to influence companies’ SDG-related impacts: active ownership through shareholder engagement and advancing and voting on resolutions.7 Through active ownership, investors use their leverage to influence the conduct and decision-making of the firms they own, to avoid sustainability and human rights risks or to capitalize on sustainability and human rights opportunities. This report considers how active investors can best exercise their leverage in the particular context of Mexico’s food sector. Although active ownership efforts have grown globally, they remain limited in Mexico and other emerging markets. Investors have an opportunity to do more to help address critical SDG-related issues in these contexts through their active ownership efforts. By doing so, they can be more responsible in ensuring respect for human rights, protecting shared systems, and supporting their long-term financial interests. Importantly, they can also ensure they comply with – and support their portfolio companies in complying with – emerging legal frameworks requiring reporting and due diligence on the impacts of their global value chains, including in Mexico.8 This report summarizes key opportunities and barriers facing investors who wish to more actively drive positive SDG outcomes in Mexico’s food sector through shareholder engagement. First, this report discusses the food sector-related SDG challenges globally and then those that are most important in Mexico. It identifies influential companies investors can engage with and surveys benchmarks on those companies’ SDG disclosure. Next, the report provides an overview of the status of and legal context for sustainable investing in Mexico. Then, it considers the extent and nature of investor influence over companies in Mexico. Based on this analysis, the report concludes by providing recommendations for investors on influencing portfolio food sector companies’ management of their SDG-related impacts in Mexico. The recommendations draw upon existing standards and guidance that bear on the roles and responsibilities of investors. This report’s primary aim is to provide guidance to Mexican and foreign institutional investors who can use their shareholdings to engage with food sector companies with a footprint in Mexico. Other stakeholders may also find this report valuable, including those interested in opportunities for the financial sector to advance the SDG-alignment in the Mexican food sector or any sector in any comparable emerging market.
Topic:
Markets, Food Security, Sustainable Development Goals, Investment, Sustainability, and Shareholder Value
Political Geography:
North America and Mexico

6. Restarting the Post-Pandemic Indian Economy

Author:
Aparna Pande, Eric B. Brown, and Thomas J. Duesterberg
Publication Date:
07-2022
Content Type:
Special Report
Institution:
Hudson Institute
Abstract:
This report is a result of a Takshashila-Hudson Roundtable Series that brought together experts, policymakers, and academics from India and the United States in November and December 2021 to discuss opportunities for the two nation-states to collaborate in a fast-changing global order. This section summarizes key recommendations for policymakers based on deliberations at the Takshashila-Hudson roundtable series Restarting the Post-Pandemic Indian Economy. The recommendations are divided into four themes for India-US Collaboration: Trade, Investments, Technology, and Human Capital Movement.
Topic:
Science and Technology, Immigration, Economy, Investment, Human Capital, Trade, and Supply Chains
Political Geography:
South Asia, India, North America, and United States of America

7. Estimating Canada’s Return on Investment from an Ambitious Program to Incentivize New Antibiotics

Author:
Rachel Silverman and Adrian Towse
Publication Date:
12-2022
Content Type:
Policy Brief
Institution:
Center for Global Development (CGD)
Abstract:
Anti-microbial drugs form the backbone of modern medicine. Yet their lifespan is naturally limited; over time, use of these drugs selects for mutations that survive exposure those same drugs, driving “anti-microbial resistance,” or AMR. Already, drug-resistant infections kill an estimated 5,400 Canadian citizens every year. In the absence of sufficient research and development (R&D) investment for new antimicrobials, deaths from drug-resistant infections could increase dramatically in the coming decade. To address this growing crisis and solve market failures that prevent the development of new antibiotics, the Government of Canada is considering a new program that would provide minimum guaranteed revenue to the successful developers of new antibiotics. In this note, we present the results of a modelling exercise to estimate the likely return on investment (ROI) from such a program, assuming it is paired with complementary and proportionate efforts from Canada’s G7 partners. The results are necessarily imprecise due to several uncertain parameters, but nevertheless provide evidence of a very high expected ROI that is robust to different inputs and assumptions.
Topic:
Health, Science and Technology, Investment, and Medicine
Political Geography:
Canada and North America

8. Germany’s Economic Security and Technology: Optimizing Export Control, Investment Screening and Market Access Instruments

Author:
Tyson Barker and David Hagebölling
Publication Date:
11-2022
Content Type:
Special Report
Institution:
German Council on Foreign Relations (DGAP)
Abstract:
Technological development and increasingly fraught US-China competition have geopolitical consequences for technology access. The erosion of post-Cold War multilateral dual-use technology export control regimes, such as the Wassenaar Arrangement, and investment and other control frameworks have led to na-tional, EU, and ad hoc measures, such as the restrictions on Russian semiconductor access following the invasion of Ukraine. The German government must integrate technology access and control instruments – export controls, FDI screening, critical infrastructure access, research protection, and outbound investment– in its Digital Strategy and National Security Strategy. The former currently neglects critical technology access and control; the latter must address it comprehensively. German – and EU – dual-use export and FDI screening reforms have been updated and are now in place. Capacity building and alignment with EU and NATO partners now deserves greater attention. Measures could include more robust, institutionalized information-sharing and consultations on dual-use technology export, import, investment, and research controls in a Multilateral Technology Control Committee born out of the G7 or TTC. The commit-tee should also establish the capacity to deny end-user access to German technology through its own Foreign-Direct Product Rules and Entity List.
Topic:
Security, Economics, Science and Technology, Investment, and Exports
Political Geography:
China, Europe, Asia, North America, and United States of America

9. Utah: Strategic Investments in the Wake of a Pandemic

Author:
Jennifer Robinson, Natalie Roney, and Johnson Ball
Publication Date:
01-2022
Content Type:
Journal Article
Journal:
California Journal of Politics and Policy
Institution:
Institute of Governmental Studies, UC Berkeley
Abstract:
Threatening economic impacts from the COVID-19 pandemic on Utah’s economy proved to be short-lived, due in part to early budget cuts, federal economic relief, and an expanding economy that out-performed expectations. Subsequently, FY22 provided the Utah Legislature opportunities to invest in education, infrastructure, and social services. Legislators also used this opportunity to cut taxes for veterans, the elderly population, and families. As the state’s population continues to grow at record rates, Utah decisionmakers must grapple with rising housing prices and record-high rental rates. This report highlights specific challenges and opportunities Utah faced through negotiating a record-high budget of $25.6 billion and provides an overview of Utah’s economy and changing demographic makeup.
Topic:
Investment, Fiscal Policy, Pandemic, and COVID-19
Political Geography:
North America, United States of America, and Utah

10. The evolving contribution of R&D, advertising and capital expenditures for US-listed firms’ growth in sales, 1979-2018: A quantile regression analysis

Author:
Joel Rabinovich
Publication Date:
01-2022
Content Type:
Working Paper
Institution:
City Political Economy Research Centre (CITYPERC), University of London
Abstract:
This article presents new insights on the evolving contribution of different types of investments to the growth in sales of US nonfinancial listed firms during the 1979-2018 period. By means of quantile regressions it is observed an increasing contribution over time of intangible investment vis-à-vis a decline in capital expenditure both for high-growth and slow-growth firms. However, the impact of different types of intangible investment differs depending on the kind of firm. Whereas research and development (R&D) has a positive contribution for high-growth firms, only advertising has a positive effect for their slow-growth peers.
Topic:
History, Investment, Research and Development, Firm Growth, Quantile Regression, and Intangibles
Political Geography:
North America and United States of America