bluuebunny/crossref_metadata_2025 huggingface dataset:
Party Organization, Party Democracy, and the Emergence of the Cartel Party (With Richard S.Katz)
Authors: Mair Peter
Published: October 2003

This is the first of two chapters on political party organizations and party systems, and discusses party organization, party democracy, and the emergence of the cartel party. It notes that a common thread running through the literature on political parties has been the view that they are to be classified and understood on the basis of their relationship with civil society, and that this has had two implications: a tendency to set up the mass party model as the standard against which everything should be judged, and an undervaluation of the extent to which differences between parties may also be understood by reference to their relations with the state. The chapter contends that both these implications are ill-founded, arguing that the mass party model is tied to a conception of democracy and to a particular, and now dated, ideal of social structure, neither of which is characteristic of postindustrial societies. Moreover, the mass party model implies a linear process of party development that suggests a suspect end-point from which the only options are stability or decay, while it can in fact be argued that the development of parties in western democracies has been reflective of a dialectical process in which each new party type generates a reaction which stimulates further development, thus leading to yet another new party type, and so on. The factors that facilitate this dialectic are not derived solely from changes in civil society, but also from changes in the relations between parties and the state. In particular, it can be argued that there has been a tendency in recent years towards an ever closer symbiosis between parties and the state, and that this then sets the stage for the emergence of a new party type, ‘the cartel party’, which, like previous party types, implies a particular conception of democracy, stimulates further reactions and sows the seeds for yet further development. The discussion is presented in seven sections: (1) The Mass Party and the Catch-All Party; (2) Stages of Party Development; (3) Parties and the State; (4) The Emergence of the Cartel Party; (5) The Characteristics of the Cartel Party; (6) Democracy and the Cartel Party; and (7) Challenges to the Cartel Party.
Electoral Markets and Stable States
Authors: Mair Peter
Published: October 2003

This is the first of three chapters on political party systems and structures of competition, and looks at electoral markets in Europe. It begins by clarifying the term ‘electoral markets’ in the context of the chapter, noting first that the competition to be investigated is inter-party competition, which will arise when parties have a market in which to compete (i.e. when there are voters in competition), and is at least in part a function of the size of the electoral market. Second, it notes that when parties confront an electoral market, they have a choice of two not necessarily exclusive strategies –– defensive or expansive; and third, that the size of the markets in general, and the degree of electoral availability, is largely a function of the strength and pervasiveness of the relevant political identities. The first section of the chapter, Developments and Contrasts in Western Europe, looks at the history of the development of political parties in western Europe as a history of attempts to narrow the electoral market through the promotion and inculcation of mass political identities; it concludes that, other things being equal, polities characterized by the presence of strong identities are likely to be less competitive than those where they are not, and will, more precisely, tend to be more consensual. The next section of the chapter, ‘Electoral Markets and Consociational Democracy’, leads on naturally to a discussion of consociational democracies (which are plural societies) in western Europe, and this is followed. in ‘Small States and Large States’, by an examination of the differences in policy style in small states (which are largely consensual) and large states (which are adversarial, with high electoral volatility). The last section ‘Some Implications for the New East European Democracies’, applies the previous discussion to eastern Europe.
Party Systems and Structures of Competition
Authors: Mair Peter
Published: October 2003

This is the third of three chapters on political party systems and structures of competition, and presents an overall review. In the first section, Approaches to the Classification of Party Systems: A Review it looks at the principal existing approaches to the classification of party systems, pointing to both their limits and possibilities when applied within comparative analysis. It then goes on in the second section, Party Systems and the Competition for Government, to underline the importance of understanding the structure of competition in any given party system, since in many ways the whole notion of a party system is centred on the assumption that there exists a stable structure of competition. Structures of competition can be seen to be either closed (and predictable) or open (and unpredictable), depending on the patterns of alternation in government, the degree of innovation or persistence in processes of government formation, and the range of parties gaining access to government. The emphasis in the third section, Party Systems and Electoral Outcomes, is on the need to distinguish between processes of electoral change on the one hand, and changes in party systems and the structures of competition on the other, a distinction which also allows the possibility of situations in which electoral change is the consequence rather than the cause of party system change.
Taking Stock
Authors: Macfarlane S. Neil
Published: October 2003

Addresses a number of definitional and methodological issues relating to the effect of the end of the cold war on developing countries. This is followed by an examination of expectations regarding the impact of the end of the cold war on the Third World expressed at the end of the 1980s and early 1990s. These expectations are compared with the progression of events in the Third World since 1989, and the reasons for the discrepancy between expectation and reality are discussed. Observations are then made on salient issues of Third World politics and security that were underemphasized or misconstrued in the cold war era, and that receive a fuller airing in subsequent thematic and regional chapters of the book. In particular, questions are raised about the extent to which a literature in security studies and international relations that emphasizes the centrality of the state, and the explanatory value of systemic structure, can adequately explain the evolution of politics in the Third World subsequent to the cold war.
The Political Dimension
Authors: Dannreuther Roland
Published: October 2003

Aims to contribute to the emerging debate over the nature of capitalist development and its relationship to the social and political developments in different regions of the world, by suggesting an analytical framework for assessing the implications of these recent developments for the political structures within developing countries. The first section seeks to isolate the most important structural and international factors that have contributed to the democratizing trend in the developing world. The second section looks beyond these general trends and assesses the existing social, economic and political conditions of most developing countries, focussing, in particular on the continuing internal and external obstacles to democratization. The final section attempts to draw from this analysis an overarching assessment of the direction of political change in the developing world, and the most appropriate models or approaches for understanding the underlying dynamic of these changes.
Globalization Manqué
Authors: Sayigh Yezid
Published: October 2003

The main strategic, economic, and political changes in the Middle East since the end of the cold war are outlined, and an attempt made to account for the linkages between them. It is argued, first, that a combination of external and internal factors has reinforced the fragmentation of the Middle East state system, and further undermined prospects for regional cooperation or integration in the security, economic, and political spheres. The record of economic liberalization is examined, before analysing the process of political liberalization. In both cases the focus is on the state, since that is the level at which management of the domestic and external environments is conducted. This allows consideration in the conclusion of the extent to which changes in the region can be directly attributed to the end of the cold war, and of the assumptions about the relationship between the international system and its regional and national units, particularly with regard to the impact of globalization on the nation state and domestic structures of political power.
Political Communitarianism and Family Life
Authors: Frazer Elizabeth
Published: October 2003

Recent communitarian politics has been focused on family policy, and the ideal of ‘the communitarian family’ has become influential among policy makers and practitioners. The concept is subject to critical analysis; it is argued that communitarianism often tries to evade questions about redistribution and conflict by emphasizing a harmony‐based social policy.
The Idea of a Political Community
Authors: Frazer Elizabeth
Published: October 2003

Communitarian politics values community activism and opposes alienating relationships between the state and the individual. The relationship and the tensions between communitarianism and republicanism are discussed, and difficulties with communitarian approaches to political strategy and democracy are examined. Finally, the very idea of a ‘political community’ is analysed and it is suggested that the nature and logic of political power mean that communitarian critiques of politics are difficult to sustain.
Divided Government in the United States
Authors: Ware Alan
Published: October 2003

This chapter concentrates mainly on the federal level of government, although some attention is also given to the state level. It considers the impact of structural and institutional factors in bringing about divided government, before examining the effects of changes in electoral behaviour at that level. The third section of the chapter focuses on how divided government is managed at federal and state levels.
Divided Governance: The Case of Denmark
Authors: Fitzmaurice John
Published: October 2003

As a result of a combination of specific characteristics of the Danish political system, such as the fragmentation of the Folketing, especially since 1973, Denmark has developed a tendency towards weak minority governments and even minority coalitions, and a cooperative, pragmatic political culture. These forms of divided government have arisen not so much out of formal institutional arrangements, as out of a Danish electoral predilection for holding the reigns of power by not passing too much of it to any majoritarian party. Their degree of success has varied over recent years, with a consequent variation in the extent to which the country has suffered from divided government.
Globalization, Regionalization, and Inequality
Authors: Oman Charles
Published: October 2003

Examines whether globalization processes can be managed so as to minimize inequality and exclusion, and to strengthen social cohesion. It details the driving forces behind globalization, which include deregulation in OECD countries (a process that also fosters regionalization), the emergence of technologies that have altered the way in which firms organize production (from Taylorism to ‘post‐Taylorist’ flexible production), globalization of financial services (which has increased governments’ vulnerability to market instabilities), and the entry of non‐OECD countries into the global marketplace. Moreover, regionalization carries risks of exclusion and protectionism, which also threaten to create destabilizing inequalities.
Security and Inequality
Authors: Hurrell Andrew
Published: October 2003

Examines the paradoxical and problematical relationship between inequality and security. It begins by looking at the classical state system, in which inequality was central not only to the genesis of insecurity (primarily because the ‘natural’ inequalities among states fostered power‐political competition and thus fuelled the security dilemmas that inevitably ensued), but also to its management and limitation. Considers how this traditional picture has been challenged. Whilst old‐style threats have by no means disappeared (especially at the regional level), the security agenda has expanded to take in a range of new threats in which inequality plays an operative role in fomenting violence. Concludes by discussing the implications of inequality for international security management today. It considers but rejects the argument that the recentralization of military power, whether conceived as the expression of a new international order or neo‐imperialism, can provide the basis for a stable and sustainable security order. However, while the old bases for security management, in which inequality played such a central role, have been undermined, they have not been replaced by anything more secure or reliable.
Political Support in Advanced Industrial Democracies
Authors: Dalton Russell J.
Published: October 2003

Builds on the global analysis presented in Ch. 2 by focusing on political support in advanced industrial societies. The goal is to determine how citizens in these nations judge the democratic process today—is there a popular crisis of democracy? There are two challenges in answering this question: first, there is the conceptual problem about what is meant by ‘political support’ or ‘support for democracy’; and second, there is the empirical problem of assembling the appropriate cross‐national and cross‐temporal data to evaluate claims about changes in public opinion. This chapter addresses both of these topics to provide a framework for assessing public support for democratic politics in advanced industrial societies.
Five Years After the Fall: Trajectories of Support for Democracy in Post‐Communist Europe
Authors: Mishler William , Rose Richard
Published: October 2003

Assesses the trajectories and dynamics of public support for seven democratizing regimes in Central and Eastern Europe—Bulgaria, the Czech Republic, Slovakia, Hungary, Poland, Romania, and Slovenia—during the first five years following the fall of communism. It begins by offering a reconceptualization of support for new democracies. An examination is then made of popular approval of the new regimes in 1991, shortly following the collapse of communism, and the trajectory of support is tracked through to 1995. Next, a model of the dynamics underlying these trends is developed and tested, paying particular attention to the extent to which support is contingent on political and economic performance. More generally, an exploration is made of whether and to what extent the sources of support change over time as citizens acquire experience with the new regimes.
Social and Political Trust in Established Democracies
Authors: Newton Kenneth
Published: October 2003

Deals with three main topics: the nature and origins of social trust and its importance in society; trends in social trust in Western societies (with some comparisons with less developed societies); and the relations between social and political trust, and their implications for theories of politics and society. In terms of the main concepts and measures of the book, and as outlined in the introductory chapter, social trust is a feature of the most basic level of community, while political trust refers primarily to attitudes about political institutions and leaders. The general assumption seems to be that social and political trust are closely linked, perhaps different sides of the same coin—social trust is regarded as a strong determinant of, or influence upon, political support of various kinds, including support for the political community, confidence in institutions, and trust in political leaders. As a result it is believed that the accumulation of social capital, in the form of social trust, will also result in the accumulation of political capital. Presents theory and evidence questioning these assumptions; it includes evidence comparing social trust in communal and modern societies, and of political trust in early modern and contemporary democracies.
Political Performance and Institutional Trust
Authors: Miller Arthur , Listhaug Ola
Published: October 2003

Previous chapters have demonstrated that low and declining citizen respect for government institutions and political leaders is characteristic of contemporary industrialized societies. Evidence since the early 1970s reveals a trend toward growing distrust of government institutions in a number of countries. While this trend is evident, the interpretation of this phenomenon has proved far more controversial. One explanation focuses upon public dissatisfaction with government performance. This chapter explores this question. First, it examines the direct link between government performance, as measured by objective indicators of inflation, unemployment, or government deficits, and institutional confidence in support for government. It then considers the dynamics of political trust and government performance, before moving on to examine the role that expectations play in translating evaluations of government performance into political distrust in three countries where long‐term time‐series data are available—the US, Norway, and Sweden. The study explores how ethical expectations about government standards influence trust in politicians and the conclusion draws some general lessons from the results. The survey data employed in the analysis include the 1990–1 World Values Survey, the Norwegian, Swedish, and US Election Studies, surveys in the US, Russia, Ukraine, and Lithuania; data from the International Monetary Fund (IMF) and OECD are used to measure inflation, unemployment, and government deficits.
Consequentialism
Authors: Matravers Matt
Published: October 2003

Consequentialist, and in particular, utilitarian theories of punishment hold that punishment is justified by its consequences. This chapter considers classic and contemporary statements of this position and argues that whilst consequentialism captures an important truth about punishment—that punishment has something to do with securing a better future—it cannot provide an adequate answer to the question of what justifies some people punishing others.
Retributivism I: Fair Play Theory
Authors: Matravers Matt
Published: October 2003

A recent attempt to revive retributive theories of punishment, pioneered by Herbert Morris and Jeffrie Murphy, argues that punishment restores the balance of benefits and burdens in a society; a balance that is disturbed by crime. Classic and contemporary statements of this position are examined and rejected. The conclusion is that fair‐play theory, with its emphasis on free riding, does not have an adequate account of ‘wrong’.
The Scope of Impartial Justice
Authors: Matravers Matt
Published: October 2003

Having argued that theories of punishment need to be embedded in wider moral theories, this chapter considers impartial theories of justice, such as those offered by Rawls and Barry. These aspire to give an account of the justification of the use of public power that does not depend on any particular, comprehensive conception of the good. By considering the relationship of impartial justice and morality, and testing the scope of impartial theories of justice, an argument is constructed to show that impartialist theory cannot give an account of the kind of rules relevant to punishment within the constraints of justificatory neutrality.
Perspectives on Firm Dynamics
Authors: Hagström Peter , Chandler Alfred D.
Published: October 2003

This chapter introduces each of the three parts (technology, strategy/organization and regions), and these are followed by summaries and comments on the different perspectives of the dynamic firm covered in each chapter.
Science, Technological Advance and Economic Growth
Authors: Nelson Richard R. , Rosenberg Nathan
Published: October 2003

Approaches the firm from the perspective of its critical role in contributing to overall economic growth, addressing the broad question of technological advance and how it comes about. The ‘technological residual’ in economists’ growth models has traditionally been treated as exogenous and has only recently come to be incorporated as endogenous, as a function of firms’ investment in research and development; the authors elaborate on this theme by focusing on the neglected role of science in technological advance and on the inherent uncertainty associated with such advance, and back their case with examples. The important contribution of private firms that invest in creating new or improved technology and appropriate the benefits thereof is given its due, but it is also noted that applied science (typically performed at universities) and research and development carried out by firms feed off each other; this interdependence stems from externalities, but also from less obvious linkages, such as private laboratories providing a labour market for university‐trained researchers, and applied university research rapidly responding to the need for scientific explanations of technological advances made by private firms. The fundamental uncertainty often associated with technological breakthroughs further complicates this picture, although the authors argue that there is commonly true surprise involved in the discovery of new technology, and in addition, make the point that in fact ‘old’ science often lies behind these breakthroughs. Finally, it is noted that incorporating the interdependence of public and private R&D, and the uncertainty of technological advance, into mainstream formal growth models may be difficult, however realistic it is.
“Sticky Information” and the Locus of Problem Solving: Implications for Innovation
Authors: Von Hippel Eric
Published: October 2003

The problem of ‘sticky’ information in the context of firms—the fact that information needed for technical problem solving tends to be costly to acquire, transfer, and put to use in a new location—is highlighted. When the requisite sticky information resides at only one location, problem solving tends to take place at that location. When more sites collectively serve as a repository of the demanded sticky information, problem solving is iterated between these sites or the problem will be broken down so as to simulate the first case. The final avenue is to make investments that reduce the stickiness, and thus the costs, of applying such information at other sites. The findings have significant implications for more general issues such as patterns in the diffusion of information, the specialization of firms and the locus of innovation.
Learning How to Govern and Learning How to Solve Problems: On the Co‐Evolution of Competences, Conflicts and Organizational Routines
Authors: Coriat Benjamin , Dosi Giovanni
Published: October 2003

Highlights the specificity of organizational competencies and their routinized, inertial, and conflictual properties from the perspective of the individual firm, arguing that persistent and distinctive variation among firms can best be understood by taking these properties into account, but only after also taking account of the pervasive influence of institutions in different countries. The role of organizational routines in explaining firm differences is addressed; with the critical competencies of firms embodied in the operational routines, they are difficult to copy and their evolution is constrained by both the characteristics of the firm itself and the environment of the firm. This is designated ‘competence specificity’, where competencies are seen not only as involving problem‐solving and learning skills, but also as including skills and rules governing firm internal relationships; hence, there is also a dual role of organizational routines—as problem‐solving procedures, and as governance devices or mechanisms for coordination. The firm is then interpreted as a behavioural entity that must compromise between several different functions and activities; this complex picture is not reducible to viewing a firm simply as a nexus of contracts, instead, competencies and routines are viewed as co‐evolving with the environment in which they are embedded. Inertia is thus ‘built into’ this concept of the firm, and in prying open this ‘organizational black box’, the authors also indicate several avenues for future research.
Design Issues for Innovative Firms: Bureaucracy, Incentives and Industrial Structure
Authors: Teece David J.
Published: October 2003

The wider issue of linkage between organizational variables and the application of new technology is addressed, focusing in particular on innovation at the level of the firm and on the choice of organizational variables that go best with different types of innovation. In the process, there is a comprehensive analysis of the underlying properties of technological innovation per se, and a set of archetypal governance modes for firms. The thrust of the argument is the need to take a broader view of innovation, not only by looking at market structure but also by relating it to organizational structure and firm boundaries as well. Both the formal and the informal structures of the firm, and the network of external linkages that they have, substantially influence innovative activity in firms. The chapter goes on to suggest that the complex and increasingly common inter‐firm arrangements that exploit complementarities and are often linked to the development of technology in fact constitute an organizational innovation of great importance.
The Wide (and Increasing) Spread of Technological Competencies in the World's Largest Firms: A Challenge to Conventional Wisdom
Authors: Patel Pari , Pavitt Keith
Published: October 2003

Addresses the specificities of firm competencies using data on more than 400 of the largest firms in the world. It demonstrates that these firms are characterized by being increasingly ‘multitechnology’, and are both stable and differentiated, with the firms’ main products strongly influencing their technology profile and direction of localized technological search. Together with home‐country conditions, the main products are also found to play an important role for the rate of search. Any determinism is, however, modified, since when looking at levels and rates of increase in technological activities, unexplained variance suggests that there is considerable scope for managerial choice. The extensive empirical data are argued to support several challenging conclusions about large firms, such as: they are heavily constrained in their technology choices and a technology strategy cannot really be outsourced; they are immune to radical technological breakthroughs to a surprising extent; and they are less than ‘focused’ in their technology strategy.
Globalization, Technological Change and the Spatial Organization of Economic Activity
Authors: Dunning John H.
Published: October 2003

Presents a further analysis of globalization in relation to technological change. The author takes issue with the all‐too‐persistent notions that only locationally immobile assets and arm's‐length transactions determine the international division of labour and competitive advantages of firms and nations, preferring to stress the important roles of created assets (including how they are created and deployed) and of multinational enterprises in the international economy. The historical roots of inadequate explanations are traced before addressing more recent developments in the theory of spatial specialization of economic activity. The role of firms in coordinating activities and in governing transactions is explored in some depth, and the place of government in this scheme of things is introduced. None of the main modalities of organizing economic activity (markets, hierarchies, inter‐firm alliances and governments) is argued to escape the profound effects of globalization, and from largely having been regarded as alternatives, it is suggested that it is now more realistic to view these modalities as having complementary roles in the organization of resources and capabilities.
Regional Clusters and Firm Strategy
Authors: Enright Michael J.
Published: October 2003

The focus of this chapter is clearly defined regional clusters of firms, and how the characteristics of these help to shape the strategy of individual firms. An extensive review leads to the conclusion that this link has largely been ignored in the mainstream literature on the subjects of clusters and of firm strategy. The author observes that critical resources and capabilities are more often found to be spatially determined rather than simply existing within any single firm, and that moreover, activities are shared across firms, and this leads to interdependence among firms in a given cluster. Apart from strategic interdependence, the tendencies for rapid information flows and a unique mix of competition and cooperation existing within clusters have important implications for firm strategy and the study thereof. The author demonstrates how events in clusters highlight significant issues such as the scope of the firm, levels of cooperation and competition, and external sources of firm advantage.
The Geographic Foundations of Industrial Performance
Authors: Scott Allen J.
Published: October 2003

Takes a broader and more conceptual approach to the effect of the local environment on firm performance than that taken by Fujita and Ishii in the previous chapter. The firm is treated as a player in regional production systems in line with the avowed objective of explaining the collective performance of these regional systems, and dovetailing the argument of the previous chapter, Scott finds that geographical space has become more, not less, important in terms of its economic effects in today's global economy. However, he raises a more fundamental point in that the observed patterns of locational differentiation and specialization, and of inter‐regional trade have in effect become more finely grained. Spatial characteristics are argued to underpin much of industrial performance, as illustrated by the localized clusters of economic activity (regional development) that have appeared historically and continue to do so; these are identified as being transactions intensive, feeding off increasing returns and agglomeration economies. Scott goes on to develop the notion of path dependency of regional clusters over time, and the dangers that may hold, before proposing a generic policy agenda that boosts the critical system of formal and informal collective order found in clusters.
International Diffusion of Knowledge: Isolating Mechanisms and the Role of the MNE
Authors: Sölvell Örjan , Zander Ivo
Published: October 2003

The overriding issue in this chapter is one of the international diffusion of knowledge (information) or, rather, the isolating mechanisms that may retard such diffusion. In view of earlier contributions to this volume, Sölvell and Zander provocatively argue that multinational enterprises are not particularly well equipped to transfer knowledge between local innovation systems. The observed difficulty of transferring tacit knowledge and process technology and the localized nature of knowledge creation are used to establish the importance of local systems. The authors also believe that there are isolating mechanisms operating at the national level, and in addition to identifying problems with knowledge transfer within the multinational enterprise, it is pointed out that such a firm is likely to neglect its own subsidiaries in its endeavour to become an insider in the local (regional) innovation cluster. Rather closely echoing Scott's view in the previous chapter, but from a slightly different vantage point, Sölvell and Zander suggest that the international competitive advantage of firms is in fact more intimately linked with dynamism within discrete local systems than is commonly recognized.
The Geographies of Strategic Competence: Borrowing from Social and Educational Psychology to Sketch an Activity and Knowledge‐Based Theory of the Firm
Authors: Spender J.‐C.
Published: October 2003

Sketches a consistent knowledge‐based theory of the firm where geography matters so that organizational knowledge must then also have a spatial dimension. The author differentiates four types of knowledge (objectified, conscious, automatic, and collective) by employing the dichotomies of explicit/implicit, and individual/social knowledge. The argument that rents arising from knowledge differences, rather than those arising from efficiency differences, are at the heart of competitive advantage allows the association of each type of knowledge with a particular type of rent. All firms are described as containing all four types of knowledge that have been differentiated, although the principal reason for the existence of firms is said to be the rents that accrue from activity‐based learning. This neatly identifies implicit and social knowledge (i.e. collective knowledge), as the key type for firms; it follows that this type of knowledge can best be created in dense, cluster‐like environments with ample opportunity for direct interaction, and successful, new industrial districts (regional clusters) are offered as good illustrations of this argument; other types of knowledge have other geographical implications for firms.
The Role of Geography in the Process of Innovation and the Sustainable Competitive Advantage of Firms
Authors: Porter Michael E. , Sölvell Örjan
Published: October 2003

This final chapter presents the authors’ view of how to link geography, innovation, and firm competitive advantage. Porter and Sölvell span many of the themes raised in the foregoing chapters, and highlight several of the more contentious issues as seen from their vantage point. The stress is on the geographical dimension and its importance for technological development in a broad sense, and, by implication, for sustainable firm competitive advantage. The dense, localized (regional) clusters reappear, as does the geographical embeddedness of firm activities and knowledge. Among other things, the authors look at the interesting things that go on outside the legal boundaries of the firm in this environment, and in particular, explore extra‐firm innovative activities and their determinants.
Globalization and National Government Policies: An Economist's View
Authors: Lipsey Richard G.
Published: October 2003

The view of globalization taken in this chapter is that it is but a subset of the immense number of structural adjustments that the world is undergoing as a result of the evolution of a related group of new technologies usually referred to as information and communications technologies (ICT). Since the ICT revolution is causing many structural adjustments, including globalization, and since the rethinking of the role of governments is to a great extent driven by all of these structural changes, it is often hard to know what is due to globalization and what is due to other aspects of the adjustments wrought by the ICT revolution. So, the scope of this chapter is the nature of the ICT revolution, the deep structural adjustments that it is inducing, including globalization, and the rethinking of the place of the government in the economy—one major driving force of which is globalization. Sect. 2 of the chapter looks at technological and structural change in general and ends with globalization in particular, and Sect. 3 deals with what economists have traditionally regarded as the functions of the nation state. Sect. 4 develops the chapter's main theme,i.e., how technological change and globalization are altering views about the place of government in the economy and, in the process, leading to a new clash of ideologies.
The Architecture of Globalization: State Sovereignty in a Networked Global Economy
Authors: Kobrin Stephen J.
Published: October 2003

Stephen Kobrin looks directly at the impact of globalization on the sovereignty of nation states. He, like Richard Lipsey in Ch. 3, sees globalization as the structural fusion of economic activity across national boundaries, and argues that it is qualitatively different from previous forms of internationalization that linked discrete economic activities by a series of arm's‐length market transactions. He views technological advances as providing both the rationale and the impetus for this integration; views MNEs (multinational enterprises), cross‐border alliances and the networking of firms as the vehicles by which it is achieved; and views governments as the creators or facilitators of the institutional framework in which production and exchange can be effectively organized. Kobrin believes that the sovereignty of nation states is being compromised—if not undermined—by globalization, and particularly by the emergence of electronic networks. He believes that this is leading to an asymmetry between political and economic space, and between the structural power of firms and national governments, both of which may be difficult to resolve without the establishment of some sort of supra‐national order.
The United Kingdom
Authors: Hood Neil , Young Stephen
Published: October 2003

This case study on the impact of globalization on the UK views the question of the evolution of macro‐organizational policies from the perspective of its approach to FDI (foreign direct investment) policy, and covers related issues with that in mind; this is because FDI is a particularly relevant driver of globalization and an arena within which government and business interaction can be readily studied in the UK. The chapter is in five main sections, starting with a review of the background to inward and outward FDI and reviewing its contribution. The second section provides an overview of the radical directional policy changes that were implemented in the UK between the late 1970s and the early 1990s in order to enhance competitiveness; this includes a more detailed and critical review of five ingredients of the policy: macroeconomic management; FDI; technology and R&D; employment, training and the labour market; and regional economic development. The third section briefly reviews three sectoral cases, which amply illustrate some of the policy challenges that have emerged for UK governments over this period as a consequence of the growing globalization of economic activity: these are the electronics industry in Scotland, the automotive industry and the financial services sector represented by the City of London. The fourth section explores the degree to which EU (European Union) policies have aided or retarded FDI and competitiveness in the UK, while the final section sets out some conclusions and propositions regarding UK competitiveness and the policies that have been adopted to enhance it.
The United States of America
Authors: Ham Rose Marie , Mowery David C.
Published: October 2003

In this case study, Rose Marie Ham and David Mowery suggest that the response of the US federal government to globalization has been extremely piecemeal and directed more to the creation of firm‐specific mobile competitive assets than to the upgrading of country‐specific, location‐bound assets (which, inter alia, influence the ability of a country properly to exploit the benefits of the mobile assets). Ham and Mowery illustrate their argument with reference to US policies towards technology, intellectual property rights, and human‐resource development. They suggest that, in response to the increasing internationalization of intangible assets, and the growing competition between governments for these assets, the US government has evolved what it perceives to be a ‘best of both worlds’ strategy, which, while supporting the creation and upgrading of the former assets (notably technology), tries to restrict their cross‐border mobility. Ham and Mowery believe the outcome may in fact be a ‘worst of both worlds’, contending that attention would be better directed towards the development of a more effective and feasible strategy of strengthening the quality of relative immobile assets and supporting the adoption and absorption of technology based assets.
Germany
Authors: Welge Martin K. , Holtbrügge Dirk
Published: October 2003

This case study analyses the possible impact of globalization on the state governance of FDI (foreign direct investment) and NEC (non‐equity forms of cooperation) in Germany in six sections. The first is an introduction, and the second looks at the German economy after unification, and gives an overview of the major influential factors on this issue—the economic situation and the international competitiveness of the German economy. The third section estimates the role of outward and inward FDI with special reference to the new Länder (Neue Bundesländer), and attitudes and policies of the German government towards FDI are discussed in the next section. The features of globalization are then outlined and challenges for federal state governance of FDI are deduced; because of the important role of trade unions in Germany, their position is also briefly discussed. The chapter ends with a short summary and outlook.
Sweden
Authors: Blomström Magnus , Kokko Ari
Published: October 2003

The purpose of this case study is to describe the traditional Swedish model of industrial policy and FDI (foreign direct investment) policy, to discuss why the trade unions were so positive towards Swedish investment abroad, and to speculate about the reasons for the changes that have occurred, or are under way. In doing this, some of the channels through which governments and institutions influence the globalization of private firms are also illustrated. After an introduction, the second section of the chapter discusses the role of inward and outward investment for the Swedish economy. The third section looks at Swedish industrial policy, and its role in the globalization of Swedish industry. The fourth section focuses on the Swedish labour movement's (trade unions’) attitudes towards FDI, and the fifth concludes the chapter by discussing why the Swedish model of FDI policy began to fade away in the late 1980s.
Japan
Authors: Ozawa Terutomo
Published: October 2003

This case study takes a dynamic view of the interface between the Japanese government and the global market. Terutomo Ozawa emphasizes Japan's particular political ideology that national governance should help to harness and steer market forces in a way that promotes national economic goals and the comparative dynamic advantage of indigenous resources and capabilities. At the same time, as the Japanese industrial structure has moved from being national‐asset based to knowledge based, the government's macro‐organizational role—and particularly that of the Ministry of Industry and Trade (MITI)—has changed from being that of a ‘national industrial architect’ to a ‘trade‐conflict negotiator’, and ‘a vision‐builder’. Ozawa also observes that the outcome of the managed market has not always been as intended, In fact, it has created two differently structured sectors: the first is an outward‐focused super‐efficient sector, which drives Japan's Schumpeterian‐type exports and foreign investments; the second is an inner‐dependent sheltered and over‐regulated sector, which has been trapped in a vicious circle of declining competition. While the pragmatic and adaptive style of Japanese governance has done much to foster the former sectors, it has also done little to discourage large uncompetitive sectors of industry, which can survive only by investing abroad in low‐cost environments.
Latin America
Authors: Frischtak Claudio R.
Published: October 2003

The object of this case study is to discuss the response of Latin American governments to the forces of globalization and increasing competition. The first main section, Sect. 2, discusses the role of governments in industrializing and developing country contexts, and the next and largest, namely, Sect.3 attempts to assess the recent Latin American experience, arguing that the road to reform—in the sense of changes in the regulatory environment, trade regimes, and asset‐ownership structures—has advanced to the point of irreversibility. Latin economies have become relatively open and increasingly competitive, and to a large extent, the wedge of reform has been driven by the globalization process; there is now a much more hospitable environment to international business in most Latin American countries, particularly to MNEs (multinational enterprises) able to link countries effectively to trade, technology, and investment networks. However, the road to macroeconomic stability has been far more difficult, and there remain persistent problems of fiscal largesse, accommodating monetary policy, low savings (public and private) and excessive domestic absorption; combined, these have led to renewed balance‐of‐payment crises in several Latin American countries since short‐term capital, which would be helpful to make the transition to macro‐stability less painful, and which has been made abundant with globalization, has proved to be a poor basis to offset persistent current‐account deficits. Financial systems have also become fragile in some countries because of excessive and non‐sustainable public‐sector borrowing and a lack of confidence of private agents.
Implications for National Governments
Authors: Stopford John M.
Published: October 2003

In this chapter, John Stopford points to both similarities and differences in the reactions of national governments to globalization. On the one hand, there has been a largely universal movement towards the deregulation and liberalization of markets for all kinds of assets, goods and services, which, itself, has aided the cross‐border mobility of some firm‐specific assets—notably of technology and organizational capabilities—and most countries have also introduced a series of macroeconomic reforms more attuned to the needs of the international market place. On the other hand, the actions of governments to reconfigure their macro‐organizational policies better to harness and upgrade the resources and capabilities within their jurisdiction have been much more piecemeal and disparate: some have confined their attention to ensuring that the main vehicles of globalization (trade and foreign direct investment) helped to promote, rather than inhibit, their national economic goals; others have concentrated on improving the competitive advantages of their firms; but relatively few appear to have given much attention to how best nations might create or restructure institutions or improve the quality of general‐purpose inputs. Stopford also takes up some of the issues raised in the introductory chapter and explored in more detail in the country case studies: he shows particular interest in the alternative policies of governments to reconfigure dynamic comparative advantage, and in the different reactions to globalization of leading and catch‐up nations; he elaborates on a number of paradoxes of contemporary global markets, and also gives some attention to the consequences of globalization for the organization of firms and states, and the extent to which cross‐border alliances between these entities is likely to promote a more heterarchical organizational structure of each. More generally, Stopford believes that globalization is leading to a range of conflicting trends, acting simultaneously at global, regional, national, and sub‐national levels.