Economic Complementarity Research Articles

Negative Shocks and Mass Persecutions: Evidence from the Black Death

In this paper we study the Black Death persecutions (1347-1352) against Jews in order to shed light on the factors determining when a minority group will face persecution. We develop a theoretical framework which predicts that negative shocks increase the likelihood that minorities are scapegoated and persecuted. By contrast, as the shocks become more severe, persecution probability may actually decrease if there are economic complementarities between the majority and minority groups. We compile city-level data on Black Death mortality and Jewish persecution. At an aggregate level we find that scapegoating led to an increase in the baseline probability of a persecution. However, at the city-level, locations which experienced higher plague mortality rates were less likely to engage in persecutions. Furthermore, persecutions were more likely in cities with a history of antisemitism (consistent with scapegoating) and less likely in cities where Jews played an important economic role (consistent with inter-group complementarities).

South Africa and Iran in the Apartheid Era

This article analyses the multifaceted relations between apartheid-era South Africa and Iran. In 1942, the exile of Iran’s ex-Shah in Johannesburg put South Africa on the map of Iran’s rulers. In the 1970s, close economic and military ties were established between the two states, based on economic complementarities and shared concern with the threat of communism and Soviet penetration into the Indian Ocean. By 1978, Iran provided over 90 per cent of South Africa’s oil. These ties did not prevent the Iranians from denouncing apartheid or bending its rules when in South Africa. The Islamic revolution of 1979 caused a break in formal relations. It affected South Africa in two ways: oil imports were disrupted, and it contributed to the growing militancy of South African Muslims in the anti-apartheid struggle. Iran then made financial contributions to the ANC, resulting in a friendly resumption of ties after the end of apartheid. The article uses extensive interviews with South African and Iranian diplomats who served in both countries.

South American Market Integration: The Argentina-Brazil Rivalry Myth and Motivations for the Southern Common Market

AbstractThis paper revisits and rebuts the mainstream view that Brazil and Argentina were led to form the Southern Common Market to end more than a century of rivalry and competition. We find the elements characterizing an interstate rivalry diminishing in the nineteenth century through the promotion of peaceful settlements and strategic alliances while those that could prompt security concerns disappeared years before the Southern Common Market was formed. Except for diplomatic disputes over the distribution of shared water resources, a disagreement settled in 1979, the decades preceding the Treaty of Asuncion were typified by security alliances, co-operation on economic complementarity and the promotion of bilateral institutions. We find little evidence for the implied security motivations being proposed in the literature. Rather, the establishment of the Southern Common Market was driven primarily by Argentina's and Brazil's desire to improve economic performance and advance political leverage through the promotion of a common stance in global affairs. This view challenges a common component in integration theory that, as applied to the European Union and elsewhere, asserts the privileged role of security concerns as prime driver for integration. This matters because there is a misapprehension that affects both the theory about integration as well as the formulation of policy prescriptions for South America.

Divergent Paths of State-Society Relations in European and Trans-Tasman Economic Integration

Observers of transnational market integration in Europe and elsewhere tend to assume a direct relationship between economic complementarity — high levels of economic transactions between countries — and depth of integration. Economic complementarity provides greater opportunities for private actors to capture the benefits of integration and is therefore assumed to be a source of social ‘demand’ required for integration. This article challenges this conventional wisdom. Australia and New Zealand have achieved a level of market integration that is comparable to that in Europe. Yet, the two countries lack economic complementarity, suggesting an alternative mechanism to the one outlined above. Rather than social groups ‘demanding’ integration vis-à-vis policy-makers’ reluctance to ‘supply’ it, in the trans-Tasman case, policy-makers led integration as the source of both ‘supply’ and ‘demand’. This observation suggests the need to question, rather than assume, the empirical sources of supply of, and demand for, efforts to coordinate economic markets transnationally.

The Cultural and Health Implications of Economic Complementarity

:Human relations involve a balance of substitution and complementarity. In economics, substitution is stressed and complementarity ignored. An economics of substitution will lead to competitive fragmentation. An economics of complementarity supports a case for cooperation and organizational health. If complementarity outweighs substitution, what are the implications? A shift to common needs enters new realms of social design. If wellbeing is social — if our benefits are aligned — the lack of conflict invites community. Here, competitive values cause strife and harm. In this paper, I depict the culture of complementarity in economics. I offer a key to achieving community, replacing substitution with complementarity in our basic assumptions. To move beyond a myopic culture resulting from competition, we need an economics of complementarity.

Democratic Limits to Redistribution: Inclusionary versus Exclusionary Coalitions in the Knowledge Economy

The knowledge economy, deindustrialization, and the decline of Fordism have undermined the economic complementarities that once existed between skilled and semiskilled workers. The result has everywhere been a decline in coordinated wage bargaining and unionization and a notable rise in labor market inequality. Yet, the political responses have been very different across advanced democracies. While labor markets for part-time and temporary employment have been deregulated across the board, some countries have compensated losers through increased cash transfers and active labor market programs and others have allowed inequality and insider-outsider divisions to grow deeper. The article argues that the divergent government responses reflect differences in underlying electoral coalitions, and that these in turn mirror the structure of party and electoral systems. The authors support their argument with evidence for government responses to economic shocks in the period 1980 to 2010.

Japan's Cold War Diplomacy and its Return to Southeast Asia

With Japan viewing Southeast Asia as its natural sphere of influence and a region of immense economic complementarities and potential, it was no surprise that Japan moved quickly in the post-war period to shore up and rebuild its influence in this strategically vital region as the European colonial powers departed from Southeast Asia. Using reparations, followed by aid and trade, Japan soon became a key economic and strategic state actor in Southeast Asia.Providing a valid counterpoint to communism, Japan proved an attractive economic model that enabled it to grow its influence in the region substantially. Using deft and low-profile diplomacy Japan became an economic leader and driver of economic growth and prosperity in Southeast Asia, supplementing and supporting US Cold War regional objectives. During times of conflict, Japan worked to reduce tensions and restore order using its unique brand of Asian diplomacy, not losing sight of its long-term goal of integrating the region economically and fostering regional peace and stability.

Unveiling the dynamic relation between R&D and emission abatement: National and sectoral innovation perspectives from the EU

This paper examines investment decisions regarding innovation and emissions abatement in a dynamic framework, where knowledge stock is an impure public good. We take a sector perspective based on neo Schumpeterian theory that emphasises the role of both sector and innovation systems. We interpret results taking into account sector and country based institutional, market and policy conditions. Econometric outcomes, based on an original sector dataset which exploits the NAMEA source for 15 European Union (EU) countries and 23 manufacturing sectors in the time frame 1995–2006, show that innovation efforts are positively correlated to various spillover effects. Those effects include the emissions abatement of the other sectors, thus pointing out the relevance of forces which opposite typical free riding behaviour in public or mixed public good frameworks. Different reactivity strengths for different global and local emissions also allow us to disclose the specific role of technological and economic complementarity. When considering CO2 emissions, innovation is mainly triggered by national interactions, a fact which is coherent with a dominance of national innovation and policy systems in the EU. The result is also consistent with the fact that CO2 abatement technologies heavily regard energy efficiency that provides joint private and public benefits. The fact that NMVOC abatement efforts by other sectors from abroad impact R&D investments positively means that, in some cases, a realm of sectoral systems of innovation is also relevant. The different evidence between local and global externalities is surely explained not only by the different technological and economic contents, but also by the fact that the EU has witnessed different policy implementation.

The Impact on Customs of the Implementation of the China-ASEAN FTA

This paper examines the impact of the ASEAN-China Free Trade Area (ACFTA) on regional trade facilitation. An overview of the development of ACFTA is followed by a discussion on the need for ongoing consideration of new policies and measures to further enhance economic complementarity and industry cooperation with the goal of strengthening zero tariff FTA policies. Research indicates that although utilisation of preferential concessions is increasing, it is less than the original expectations of China’s Central Government. Policies are therefore being considered and other measures designed to enhance the utilisation rate. The challenges presented by these initiatives and their impact on Customs’ already limited resources are outlined. The paper concludes by identifying opportunities for Customs to effectively address the growth in regional trade and contribute to the negotiation, formulation and enforcement of rules of origin.

浅析中韩经贸合作中FTA的建立

自1992年两国建交以来，中韩两国积极开展经贸合作，贸易形式从间接贸易转为直接贸易，贸易额迅速增加，经济互补性逐渐增强，双方已经互为重要的投资对象。但是，随着两国之间日趋成熟的贸易发展，越来越多的问题从现状中暴露出来，例如贸易逆差和贸易摩擦。因此，本论文通过对中韩贸易经济现状以及进行贸易往来时出现的问题的研究分析，探讨两国之间建立自由贸易区，即FTA(Free Trade Area)的可行性，并简要分析FTA对中韩双方经济的影响。最后，就以上对FTA的分析结果简要提出建议。 China and South Korea carried out economic cooperation actively since 1992 when the diplomacy between the two countries was established. The trade forms have converted from indirect trade to direct one, and therefore the value of trade has increased rapidly, and the economic complemen-tarities between the two countries have been enhanced gradually. The two sides have become important investment objects for each other. However, with the development of trade, more and more problems were exposed, such as trade friction and trade deficit. Therefore, this thesis makes exploration for the feasibility of establishing Free Trade Area between the two countries, referred as FTA, based on the current situations and problems in the trade. Moreover, the impact of the es-tablishment of FTA on the economy of both China and South Korea will also be analyzed briefly. Finally, the thesis proposes policy suggestions briefly through the analysis of these results.

Vestnorden. A functional region?

This article discusses the issue of what kind of a region Vestnorden is. The need for such a discussion arises from the challenges posed by globalisation for the idea and construction of the West Nordic space, and the need to observe how this regional unit counters these processes. The article is based on an analytical framework which presupposes that a functional region has to consist of four elements. First, whether the space has its own institutions for decision making; second, how far there is economic complementarities among the involved nations and territories; third, to what degree they have common economic interests; and finally, to what extent social, cultural and historical ties exist between the territories involved. The article argues that there is an urgent need to discuss and reorient the institutional functionality of Vestnorden as a regional unit.

TOURISM CRISES AND REGIONALIZATION IN SOUTHEAST ASIA

Globalization and regionalization are dominant trends in the world’s economy as they stimulate economic integration and new forms of cooperation which affect the operation of the tourism industry. The emergence of growth triangles and development corridors, within the context of regionalization, is part of the governments’ efforts to pursue certain broad economic objectives in one specific sub-region. This concept is also apparent in place marketing as the strategic alliances that are formed promote a set of countries, or parts of them, as single destinations. This paper, based on secondary data, seeks to examine whether tourism crises have had any effect on economic complementarities, comparative advantage and competitiveness of subregion destinations in Southeast Asia. Although regionalism appears viable for many governments, this paper argues there are various constraints in operation and difficulties to overcome in terms of their contribution to tourism, especially when this region has often been struck by many crises of different types and magnitude in the past two decades. Thus, it seems timely to review existing mechanisms and consider whether they have a continued role in tourism expansion in the region.

Evolution of the business air travel network in the US from 1993 to 2011: A descriptive analysis using AIRNET

Despite recent attention focused on business air travel, most existing analyses rely on cross-sectional data drawn from a single year or season. To address this gap, this paper provides a descriptive portrait of business passengers' movements among 108 US metropolitan areas in each year from 1993 to 2011. The business air travel networks are examined at three levels: the node, the dyad, and the system. Node-level analysis reveals small fluctuations among historically dominant business cities, but also the recent rise of smaller emerging business cities. Dyad-level analysis highlights the continued importance of traditionally high-volume business routes (e.g. New York–Los Angeles), but that economic complementarity between smaller cities can also be a source of high-volume business traffic. Finally, system-wide analysis suggests that business travel among US cities is becoming more symmetric and evenly dispersed. The paper concludes with a discussion of these findings implications for managerial practice and their contribution to scholarly knowledge.

Survey of the Literature on Successful Strategies and Practices for Export Promotion by Developing Countries

Export promotion policies refer to the set of foreign trade policies targeted to exports enhancement. The aim of the present paper is reviewing the wide experience collected by the various countries in the past. Our purpose is two-fold. On the one side, our contribution aims at identifying the best practices so far and provide policy guidelines for the future. On the other, it highlights the policy, institutional and economic complementarities that make successful stories context-specific and warn against “one size fits all policy.”

Cultural and Economic Complementarities of Spatial Agglomeration in the British Television Broadcasting Industry: Some Explorations

This paper considers the processes supporting agglomeration in the British television broadcasting industry. It compares and contrasts the insights offered by the cultural turn in geography and more conventionally economic approaches. It finds that culture and institutions are fundamental to the constitution of production and exchange relationships and also that they solve fundamental economic problems of coordinating resources under conditions of uncertainty and limited information. Processes at a range of spatial scales are important, from highly local to global, and conventional economics casts some light on which firms are most active and successful.

The Strategic Dissonance Between Europe and China

Relations between China and the European Union (EU) are in a profound state of transition. As one China-specialist observed, ‘The breadth and depth of Europe-China relations are impressive, and the global importance of the relationship ranks it as an emerging axis in world affairs.’1 A former European Commissioner declared in the same vein, ‘We all have to become China-experts.’ Premier Wen Jiabao called the Sino–European partnership ‘mature, balanced and determined’, citing its economic complementarity as solid evidence of further growth. This article evaluates the evolving China–EU relationship and tests its potential to develop into a strategic axis in world affairs. The next section presents a concise historical account of EU–China relations and discusses the drivers that generate expectations of a strategic partnership. The third section elaborates on Europe’s conditional engagement and how it has tried to socialize China with its own norms. Finally, the article takes stock of the extent of convergence with regard to the norms that underpin international politics.

The Proposed Australia-China FTA: Protectionism over Complementarity?

This article deals with the proposed high-profile Australia-China Free Trade Agreement (FTA). It recognizes their economic complementarities for an FTA. However, their negotiations reveal many competing interests, militating against an FTA. If political enthusiasm succeeds in concluding this FTA, it is likely to fall short of delivering the projected economic benefits. This FTA will possibly be an inward looking discriminatory trading arrangement with exclusive preference to each other in selective sectors and protection against non-members, inconsistent with Article XXIV of the General Agreement on Tariffs and Trade (GATT). Such protectionist obsessions have become an obstructive alternative to multilateral nondiscriminatory trade rendering it more onerous and less viable. Concluding such an FTA, at a time when World Trade Organization (WTO) Panels and Appellate Body (AB) are increasingly dealing with FTA disputes, may result in a legal challenge. The booming Australian and Chinese export sectors need open global markets to maximize their full trade potentials, which can be achieved through the completion of the Doha Round.

Chinese migration: still the major focus of Russian Far East/Chinese North East relations?

In contrast to Sino-Russian relations at the state-level, regional cooperation between the contiguous Russian Far East and Chinese North East has been difficult to achieve, despite the existence of seemingly natural economic complementarities. This article asks why this is the case and argues that one important stumbling block, i.e. negative reactions to Chinese labour migration, has become less problematic. Situating Russian Far East/Chinese North East relations in a regionalist framework the article compares the salience and framing of major issues in regional relations in Chinese and Russian media at the national and regional levels. Contrary to earlier research, the findings suggest that economic and regional development issues, and not Chinese migration into the Russian Far East, are by far the most salient sets of issues on both sides. However, significant differences in the framing of these issues suggest that a convergence of opinion on the desirability of regional cooperation masks contradictory expectations for the direction of regional development.

On the Economic Foundation of the Urban Network Paradigm: Spatial Integration, Functional Integration and Economic Complementarities within the Dutch Randstad

Conceptually, the degrees of spatial and functional integration and urban complementarities in economic network relations are hypothesised to be important. In this paper, data on interfirm relations in the Dutch Randstad are used to test conditions for integration and the existence of economic complementarities. A clear hierarchy is observed in the different types of spatial interdependencies in the Randstad, in which the central place model prevails. Furthermore, no evidence is found for the functional integration of municipalities in the Randstad. It is concluded that, at this moment, the Randstad does not function as a spatially and functionally integrated region and that spatial economic policy can better focus on smaller regions within the Randstad. This also calls into question the applicability of the urban network concept in general, as the Dutch Randstad is usually seen as a prime example of an economically successful polycentric urban system.

Polycentric Regions: Comparing Complementarity and Institutional Governance in the San Francisco Bay Area, the Randstad and Emilia-Romagna

A gap in the literature that remains largely unfilled is a discussion of how polycentrism relates to broader tensions between strategies of specialised industrial agglomeration economies and diverse regional portfolios. Relatively little is known about how strategies of polycentrism relate to the industrial composition and economic complementarity both at the regional scale and for individual cities within the region. In this paper, correspondence analysis is used to quantify complementarity in the economic profiles of cities in three polycentric regions. The findings suggest that the degree of complementarity varies greatly but has decreased in all three of the case study regions over time. Subsequent analysis of institutional structures in these three regions suggests that regions with weaker regional governments, stronger regional identities and intentional polycentric development strategies might experience higher levels of complementarity. A series of hypotheses that relate institutions to complementarity are proposed as possible directions for future research.