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361. Decentralized Cooperation and the Future of Regulatory Reform

Author:
Pepper D. Culpepper
Publication Date:
01-2001
Content Type:
Working Paper
Institution:
Minda de Gunzburg Center for European Studies, Harvard University
Abstract:
Faced with the fact of sweeping regulatory reform, how do companies decide how to respond to a new set of policies? This paper argues that this problem requires a new conception of policymaking: a conception that recognizes the analytical primacy of achieving coordination under uncertainty. I call this challenge the problem of securing decentralized cooperation. Negotiated reforms are a common leitmotif of the current wave of reforms taking place in various European countries, whereas American attempts to reinvent government opt to replace the state with the market. There are general lessons in this approach for both strategies. Unlike the earlier attempts to establish neo-corporatist bargains at the national level in European countries, the success of bargained pacts in Europe will depend increasingly on allowing private actors to design the best solutions to centrally identified problems. The challenges of bringing private information to bear on public policy will increase in the future, and not only in supply-side economic policy reforms. One such area is environmental regulation, which is typically viewed as an area of pure state regulation. This is also an area where market-based solutions are frequently proposed as the most efficient solution to problems of pollution. As I demonstrate through the initiative of the Chesapeake Bay Program in the United States, the challenges identified above for areas of economic policymaking are now relevant to environmental initiatives, even in liberal market economies such as the US and the UK. The extent of government success in such initiatives will be determined by the ability of governments to understand the importance of private information and their capacity to develop private sector institutions that can help procure it. Attempts to replace a malfunctioning state with a market solution, currently very much in vogue in certain quarters in the United States, will fail, as long as they do not recognize the distinctive problems inherent in securing decentralized cooperation.
Topic:
Economics and Industrial Policy
Political Geography:
United States, United Kingdom, and Europe

362. The Politics of Trade in North America: Comparing Models and Industries

Author:
Arturo Borja Tamayo, Philippe Faucher, Scott Morgenstern, and Daniel Nielson
Publication Date:
07-2001
Content Type:
Working Paper
Institution:
Centro de Investigación y Docencia Económicas
Abstract:
This working paper studies the negotiations of the North American Free Trade Agreement (NAFTA) in two industrial chains: textile-apparel and auto parts-automotive. It compares two theoretical models. The first uses two internal variables (interest group strength and industry competitiveness) to explain the tariffs that were negotiated for the phase-out period of NAFTA. The second explores alternatives to increase the explanatory capacity of two-level games models. It incorporates the element of asymmetry between countries, and questions Putnam's (1988) hypothesis on the impact of domestic politics upon international negotiations. This second model explains the difference in the rules of origin that were adopted in NAFTA for the two industrial chains. The work reaches three conclusions. First, it confirms the necessity to specify different dependent variables to explain the outcomes of international trade agreements. Second, it concludes that a model using the two-level logic has explanatory advantages over one that does not combine levels. Third, it points out the potential to combine elements from the two models to reach a more complete explanation.
Topic:
Economics, Industrial Policy, and International Trade and Finance
Political Geography:
North America

363. Government - Financial Sector Relations and the New Financial Structure in Mexico

Author:
Charles W. Parker III and Susan Minushikin
Publication Date:
07-2001
Content Type:
Working Paper
Institution:
Centro de Investigación y Docencia Económicas
Abstract:
For the first time in its modern history, Mexico is confronting a financial sector that is controlled by foreign investors. At the same time it is highly concentrated. The economic challenges that such an industry structure presents were the focus of public debate over the sales of Bancomer and Banco Serfin. The political challenges have not yet become a part of the public debate. These include changing relations between the banks and the government. This paper traces the history of government-bank relations and speculates on how this relationship may change given the new structure of Mexico's financial sector.
Topic:
Economics, Industrial Policy, and International Trade and Finance
Political Geography:
North America and Mexico

364. Corporate Governance in Transition: Ten Empirical Findings on Shareholder Value and Industrial Relations in Germany

Author:
Martin Hopner
Publication Date:
05-2001
Content Type:
Working Paper
Institution:
Max Planck Institute for the Study of Societies
Abstract:
Within the context of debates over national “varieties” of capitalism, this paper discusses the shareholder value orientation of the 40 largest listed German companies. Three dimensions of shareholder value are distinguished: the communicative dimension, the operative dimension and the dimension of managerial compensation. A shareholder value index compiling data on accounting, investor relations, variable top-management compensation and the implementation of profitability goals makes it possible to compare the shareholder orientations of the companies. The shareholder value phenomenon is explained first by the exposure to markets – the international product market, capital market pressures and the market for corporate control – and, secondly, by internal developments – changing management careers, increasing management compensation and reduced monitoring by banks and corporate networks – which cause external impulses to increase shareholder value to fall on fertile ground. Conflicts over shareholder orientation result in changing coalitions between shareholders, management, and employees. Shareholder value does not make companies opt out of central collective agreements or endanger the existence of employees' codetermination, but it does lead to more market-driven industrial relations.
Topic:
Economics, Industrial Policy, and International Trade and Finance
Political Geography:
Germany

365. Microsoft's Appealing Case

Author:
Alan Reynolds and Robert A. Levy
Publication Date:
11-2000
Content Type:
Policy Brief
Institution:
The Cato Institute
Abstract:
Judge Thomas Penfield Jackson's final judgment in the Microsoft case indicates that he has fallen hook, line, and sinker for the government's flawed arguments. But the U.S. Court of Appeals for the District of Columbia Circuit is unlikely to be so accommodating. The Justice Department's case will crumble as a result of procedural errors, flawed fact-finding, wrongheaded legal conclusions, and Jackson's preposterous plan to break up the software company most directly responsible for America's high-tech revolution.
Topic:
Government, Industrial Policy, and Science and Technology
Political Geography:
United States and America

366. The Japanese Network State in U.S. Comparison: Does Embeddedness Yield Resources and Influence?

Author:
Jeffrey Broadbent
Publication Date:
07-2000
Content Type:
Working Paper
Institution:
Walter H. Shorenstein Asia-Pacific Research Center
Abstract:
Scholars describe the East Asian—Japanese and South Korean—state as a network state that guides the private sector by means of embedded relationships (i.e., informal persuasive ties). In theoretical terms, these embedded ties represent informally institutionalized social capital. This study refines the network state thesis by comparing embedded ties with tangible resource exchanges in their effects upon political influence among political (organizational) actors in Japanese and U.S. labor politics. The network state thesis predicts that in Japan embedded ties should channel the flow of tangible resources (e.g., vital information, political support), and that embedded third party brokers should mediate this flow. Embedded ties have generally pervaded the Japanese polity, whereas in the United States, they have remained concentrated within the labor sector. In Japan, the embedded ties form a “bow tie” pattern: the Ministry of Labor (MOL) bridges a structural hole between corporatistic business and labor. The presence of embedded third parties predicts the dyadic exchange of information. Political support, by contrast, forms a distinct, nonembedded network, centered on political parties. Tensions between the embedded network and the instrumental political support network help explain characteristics of Japanese politics, such as the relative slowness of its response to financial crisis.
Topic:
Industrial Policy and Politics
Political Geography:
United States, Japan, Israel, East Asia, and South Korea

367. Opening Up to the World: India's Pharmaceutical Companies Prepare for 2005

Author:
Sean Eric Smith
Publication Date:
05-2000
Content Type:
Working Paper
Institution:
Walter H. Shorenstein Asia-Pacific Research Center
Abstract:
In 2005, India will implement new intellectual property (IP) laws that recognize product patents on pharmaceuticals. Because India's 1970 Patent Act only recognizes process patents, Indian drug companies have been free to copy molecules from multinational companies (MNCs), to sell within India and other nonpatent conforming markets. New laws, such as the Exclusive Marketing Rights amendment to the 1970 Patent Act (ratified on April 19, 1999), will substantially alter this practice. This paper discusses what companies are doing to prepare for 2005 and beyond. As is the case today, Indian and MNCs alike will figure prominently in the future of the pharmaceutical sector, albeit in somewhat altered form. Although the new patent regime has the potential to reward MNCs at the expense of Indian firms, local companies will likely benefit from stricter laws. In fact, it is plausible that the 2005 laws will vault some Indian pharmaceutical companies into globally prominent positions.
Topic:
Industrial Policy and International Law
Political Geography:
South Asia and India

368. Market, Technology, and Policy Drivers: The Future Structure of the Electricity Industry

Author:
Elizabeth Malone
Publication Date:
01-2000
Content Type:
Working Paper
Institution:
Aspen Institute
Abstract:
The electricity industry is being challenged on the one hand by restructuring and on the other by the potential of new technologies. Restructuring is proceeding slowly and unevenly, with uncertain national leadership, disputes over the jurisdiction of the Federal Energy Regulatory Commission (FERC), continuing and increasing environmental concerns, and a plethora of state policies and regulations.
Topic:
Energy Policy, Industrial Policy, and Science and Technology
Political Geography:
United States

369. Changing Rules In the Market for Attention: New Strategies for Minority Programming

Author:
Richard P. Adler
Publication Date:
01-2000
Content Type:
Working Paper
Institution:
Aspen Institute
Abstract:
In July 1999, a controversy erupted that focused public attention on the issue of the representation of blacks and other minorities in the media. It began when Kweisi Mfume, president of the National Association for the Advancement of Colored People (NAACP), expressed dismay that only one of the twenty-six new prime time television programs planned by the four major broadcast networks for the upcoming fall season included a black actor in a leading role. Shortly thereafter, representatives of several other minority groups, including Hispanics and Asians, claimed that their members were also underrepresented in network programming. The controversy generated a good deal of discussion about how television programs are developed and cast. Eventually, the NAACP and the four networks reached agreements that identified a variety of steps the networks would take to increase minority participation in network programming.
Topic:
Industrial Policy and Science and Technology
Political Geography:
United States

370. Campaigns in Cyberspace: Toward A New Regulatory Approach

Author:
Anthony Corrado
Publication Date:
01-2000
Content Type:
Working Paper
Institution:
Aspen Institute
Abstract:
The explosive growth of the Internet as a medium for political activity is transforming our conceptions of political communication and the methods by which campaigns for public office are conducted. This rapidly evolving technology has already made possible an unprecedented flow of information and new modes of citizen participation in the electoral process. The Internet has provided candidates with a means of communicating directly with voters without the inter-mediation or interpretation of the news media. Candidates now use web sites to offer voters texts of public statements and detailed information on their policy positions, as well as audio and video materials. These sites allow individuals to “customize” information so that they may access materials that are relevant to their particular concerns or interests. Similarly, these sites allow candidates to provide individuals with updated information as it becomes available, facilitating a type of interaction between campaigns and individual voters that was not possible before the advent of digital communications.
Topic:
Industrial Policy and Science and Technology
Political Geography:
United States