Russia in international economic institutions: are there contradictions in the regional and global agendas?

The relatively centralised global economic governance architecture created after the historic Bretton Woods conference of 1944, comprising the International Monetary Fund, the World Bank and the General Agreement on Tariffs and Trade (GATT), is decentralising. One of the manifestations of the decentralisation process is the rise of regional economic institutions that operate alongside their “senior” global counterparts. Regional financial arrangements, regional development banks and reciprocal trade agreements have become increasingly important in global economic governance. The conventional view of the relationship between regional and global economic institutions, or that between regionalism and multilateralism more generally, has been coloured by the “contested multilateralism” theoretical paradigm which predicts conflictual, competitive, and fragmenting dynamics between regional and global economic governance bodies. We reject such views and adopt a “benefit-risk” analysis method to examine whether the move from a centralised to decentralising global economic architecture entails net gains or net losses for global financial, monetary, trade and development governance. It is argued that complementarity and division of labour between regional and global institutions can be cultivated to advance global economic governance. Towards the end of the chapter, the main arguments and findings of the other chapters of the edited volume are summarised and highlighted. The role of Asia is identified.

The explosion of research on regional economic institutions (REI) over the last two decades has led to a richer understanding of why they emerge, what form they take, and what effects they have. This chapter argues that research on REI is not a monopoly of any particular theoretical, methodological, or epistemological approach. Ongoing work leans not merely on standard political science and economics but on sociology, psychology, and critical theory. Yet, REI studies cluster in silos more often than barns, although this chapter highlights some research programs with potential for fostering barns. Exclusive attention to power, economic efficiency, transaction costs, and transnational normative diffusion—the common analytical currency in standard accounts of REI—may conceal deeper domestic drivers underlying REI dynamics.

This paper considers the international and regional economic institutional environment within which the economies of Northeast Asia interact. Most of the paper is about the Asia-Pacific Economic Cooperation forum (APEC), and its potential regional institutional role. There are a number of issues which must be resolved if APEC is to successfully implement its future policy agenda of trade and investment liberalization, facilitation, and economic development. Various approaches are assessed in light of the free rider problem and timing concerns. Trade liberalization is the most contentious issue, given the lack of consensus on MFN treatment for non-APEC members, and the unwillingness of some members to engage in formal, comprehensive, and substantive trade negotiations. A new approach to trade liberalization, based on voluntary liberalization and peer group pressure has been proposed, termed "concerted unilateral liberalization." Whether it will succeed depends on how willing APEC members are to reach substantive, concrete agreements to implement the vision enunciated at Bogor in 1994 of free trade and investment in the Asia-Pacific region by 2010 for developed economy members and by 2020 for the developing members.

This paper focuses on the two-way relationship between China and the international economic system. China’s embrace of the global institutions and their rules and norms helped guide its spectacular economic growth and integration into the world economy. China’s impact on the global economic order is still an open question, however. Its sheer size and dynamism makes it a force to be reckoned with. So far its influence has been largely constructive but recent signs of assertiveness raise questions about the future. History matters to the answer. Memories of both historical pre-eminence and humiliation drive nationalism and assertiveness at the same time that China identifies with developing countries as a counterbalance rather than as a leader or enforcer of the global norms and rules. The paper evaluates China’s role in the regional and global economic institutions by applying this criterion of economic cooperation: is China willing to modify national policies in recognition of international economic interdependence? The evidence presented is mixed reflecting the complexities of China’s modernization and re-emergence. China actively supports the order in some forums, shows passivity in others yet in still others increasingly asserts its own interests regardless of the global rules. The paper draws conclusions and future implications of this new ‘normal’.

History Matters: China and Global Governance

In recent years, China scholars have often debated the meaning and definition of the Chinese Revolution. While some studies reveal discontinuity or radical and transformative change, others show continuity or gradual and evolutionary change. This article contributes to the debate by examining how the connective tissues in Guizhou’s regional economic institutions—the regional economic bureaucracy and regional state enterprises as well as enterprise organization, management, and incentive structures and mechanisms—emerged, grew, broke down, and were replaced over the period 1937 to 1957. Specifically, it focuses on the creation and expansion of Guizhou’s regional state enterprises, the transformation of enterprise authority structure, the transplantation of the Soviet economic accounting system, the appropriation of the Western accounting system, and the development of social service and welfare institutions. Drawing extensively on heretofore unavailable archival and published material, this study demonstrates that the changes in Guizhou’s regional economic institutions were both radical and transformative and gradual and evolutionary. In the process, Guizhou’s regional state enterprises came to be defined by bureaucratic enterprise governance, Chinese Communist Party control over enterprise employees, and distinctive enterprise management and incentive mechanisms.

China’s rising economic clout in both regional and international economic institutions has caused considerable unease about whether Beijing might push for major reforms and restructuring within the World Trade Organization to serve its core economic interests. A growing strand of literature on ‘Rising China’ portrays Beijing as a potential challenge to the existing global economic order. Notwithstanding such predictions, compounded by relocation of powers in the global economic system in the aftermath of the global financial crisis, China appears unable to position itself as a challenger to the multilateral trading system and by extension to the extant economic order owing to a set of domestic constraints. This article attempts to critically examine the assertions of revisionist China in the WTO and its implications for the global economic order. The article seeks to develop two important explanatory models using domestic–political and ideational factors alongside the traditional focus on structural factors. These models would offer a nuanced understanding of how Chinese domestic politics and institutional ideologies play out in the domain of international institutional engagement.

Over the past two decades many Central and South East European countries underwent the process of transition from a centrally-planned towards a market economy. Among them, the case of Croatia stands out as particularly interesting. Owing to a number of reasons Croatia had the potential to be among the forerunners of transition. However, in realising this potential the country was constrained by numerous political and social turbulences which made its transition path somewhat unique. The objective of this paper is to explore to what extent the favourable initial conditions of Croatian transition have been exploited over the past two decades. The focus of the analysis is on four dimensions of transition: institutional reforms, macroeconomic performance, changes in economic structure and international trade. The general message yielded by the analysis is that much of Croatia’s initial advantage was lost over the past two decades because of war, the unfavourable political climate in the 1990s, late integration into regional, European and global economic institutions and the slow restructuring of enterprises.

Drawing on the institutional-based view, this paper sheds light on the influence of the development of subnational institutions within a host country on foreign affiliate performance. Using 186,158 firm-year cases in 28 subnational regions of China, we find that the levels of the development of regional economic and social institutions have positive curvilinear impacts on the level of foreign affiliate performance and negative curvilinear influences on variation in that performance. However, the impacts of regional political institutions on foreign affiliate performance differ from those of regional economic and social institutions.

The purpose of the study is to develop a model for the co-evolution of the regional economy and economic institutions. The research methods used: abstract-logical for the study of theoretical aspects and the experience of modeling co-evolution; and economic-mathematical for the development of own model of coevolution. The results of the study: approaches to modeling the evolution of economic institutions, as well as the co-evolution of the regional economy and economic institutions are considered, strengths and weaknesses of existing approaches to modeling co-evolution are identified, on the basis of the logistic model and Lotka-Volterra equations, an own co-evolution model has been developed, which includes three entities: regional economy, “good” institution and “bad” institution. Three versions of the model have been developed: the co-evolution of the regional economy and the “good” institution, the co-evolution of the regional economy and the “bad institution,” and a variant of the co-evolution of all three entities simultaneously, in which the “good” and “bad” institutions interact according to the “predator-prey” model, and their the cumulative effect determines the development of the regional economy. Numerical experiments have been carried out in the MathLab, which have shown the capabilities of the model to reflect the results of the co-evolution of the economy of a resource-producing region and economic institutions. In the first variant, a “good” institution promotes economic growth in excess of the level determined by resource availability. In the second variant, the “bad” institution has a disincentive effect on the GRP, as a result of which the GRP falls below the level determined by the resource endowment. In the third variant, the interaction of “good” and “bad” institutions still contributes to economic growth above the level determined by resource availability, but causes cyclical fluctuations in the GRP.

Abstract: It is increasingly recognised that both formal and informal institutions could be important variables in explaining the diversity of capitalist systems. However, less is known about the relative importance of regional institutions for regional economic activity and regional development, especially in developing countries. This article analyses the relative importance of regional institutions to regional capitalist systems in Southeast Asia, using the comparative institutional approach of ‘business systems’. Two comparisons are made that enable an analysis of the relative importance of regional institutions: one between two regional economies in the same country (Cebu and Negros Oriental in the Philippines) and one between two bordering regional economies in different countries (Satun in Thailand and Perlis in Malaysia). We investigate four sets of economic institutions: the extent of alliance coordination of supply and demand, the extent of collaboration between competitors, the extent of alliance coordination of sectors and access to finance. The results suggest that regional economic institutions are stronger in agricultural areas with relatively weak national economic institutions and that the presence of strong and enabling regional economic institutions is one of the factors that lead to taking advantage of favourable agricultural conditions, to economic growth and, ultimately, to catching up.

The international relations literature on regionalism, both in economic and security issues, has grown dramatically over the last 15 years. One of the ongoing issues discussed in most articles and books is the conceptualisation of ‘region’. Instead of thinking about regions using notions of interdependence and interaction we take a social constructivist approach, whereby states themselves define regions via the construction of regional economic institutions (REI). We explore how a conceptualisation of region based on REIs contrasts with various related concepts such as regional system, and regional IGO. Empirically, we show that most all countries belong to at least one important regional economic institution, REI, (for example, EU, Mercosur, ASEAN, etc). In short, the world is dividing itself into regions by the creation of regional economic institutions. We contrast our economic-institutional approach to regions with Buzan and Wæver's ‘regional security complexes’ which is based on security dependence. There are interesting agreements and disagreements between their approach and our economic-institutional approach to defining regions. It is perhaps not surprising that many REIs have taken on security roles, which we briefly show by looking at military alliances embedded in REIs. This suggests that policymakers are creating regions through institutional innovations that link economic and security issues.

The paper is dedicated to the study of the evolution of economic institutions in the resource-producing region, to the investigation of their specificity and institutional traps. As the initial data, the legal framework, the experience of the functioning of economic institutions and statistical data were used. The subject matter of the research is the influence of regional specificity on the evolution of economic institutions. The research topic is the analysis of the evolution, specificity and institutional traps of the economic institutions of the resource-producing region on the example of Khanty-Mansi Autonomous Okrug — Yugra. The purpose of the research is to identify the relationship between the regional specificity and the direction of the evolution of economic institutions. The hypothesis of the study is that the regional specificity has an impact on the evolution of economic institutions and contributes to the formation of institutional traps. The framework methodology of the work is a comparative institutional analysis. As a result, the stages of the evolution of economic institutions are determined, their regional specificity and institutional traps are revealed. The scientific input is in the revealing of the specificity of institutional traps at the regional level as well as the influence of specificity on the evolution of economic institutions. The author came to the conclusion that the specificity of the region's economy affects the specificity of institutions as well as the formation of institutional traps. At the same time, some traps have a system-wide character and do not depend on the specificity of the region; this applies to the basic economic institutions. The most strongly the regional specificity is appeared in the evolution of the economic institutions for development, whose institutional traps are in many respects predetermined by the regional specificity. The results can be applied by the public administration at the regional level for the development and introduction of amendments to the legislation and further research. There is still the question of what comes first — the regional economic institutions or the economic development of the region, that is necessary to study both the co-evolution regional institutions and regional economics. Also, more research is needed to assess the impact of institutions on the level of transaction costs of economic entities.

Recently much has been written about the ethical issues surrounding global politics. There has, for example, been a considerable literature on global ideals of distributive justice. However, amongst all this, very little has been written by political theorists on some of the most significant international institutions, such as the International Monetary Fund (IMF), the World Bank and the World Trade Organisation (WTO). Many discussions of global distributive justice tend to regard states as the central duty-bearers and assume that the pursuit of global justice requires, for example, an increase in states' overseas development budgets. There has, of course, been a considerable literature on some international institutions. Writers such as Daniele Archibugi and David Held have defended what they term a ‘cosmopolitan democracy’ where this calls for the democratisation of global political institutions. However, the focus of this perspective tends to be on reforming the United Nations. My aim in this chapter is to provide a provisional and tentative analysis of the normative nature of international economic institutions, such as the IMF, World Bank and the WTO. I shall make particular reference to these three institutions, in part, because they play an important role and, in part, to simplify the analysis. However, it is not assumed that these are the only international economic institutions of import nor is it assumed that the analyses that follow cannot be applied to other institutions. To this we should also add that the chapter is exploratory in nature.

This book provides the comparative study of regional international organization in terms of institutional design and the nature of cooperation. The book highlights the similarities and differences in the efficacy across regional institution and relationship between institutional design and the nature of cooperation. The book starts with the central question, Why does it appear that different forms of institutions develop in different regions of the world, where States generally face similar kind of difficulties in cooperation? In this regard, the authors of the book found two puzzles, the first one being how to describe and explain any variation in the design of regional security and economic institutions across world.