Frederick W. Mayer

Regulation and Economic Globalization: Prospects and Limits of Private Governance

Corporate codes of conduct, product certifications, process standards, and other voluntary, non-governmental forms of private governance have proliferated in the last two decades. These innovations are a response to social pressures unleashed by globalization and the inadequacy of governmental institutions for addressing its social and environmental impacts. Private governance has had some notable successes, but there are clear limits to what it alone can be expected to accomplish. We hypothesize that the effectiveness of private governance depends on four main factors: 1) the structure of the particular global value chain in which production takes place; 2) the extent to which demand for a firms products relies on its brand identity; 3) the possibilities for collective action by consumers, workers, or other activists to exert pressure on producers; and 4) the extent to which commercial interests of lead firms align with social and environmental concerns. Taken together, these hypotheses suggest that private governance will flourish in only a limited set of circumstances. With the trend towards consolidation of production in the largest developing countries, however, we also see a strengthening of some forms of public governance. Private governance will not disappear, but it will be linked to emerging forms of multi-stakeholder institutions.

Managing domestic differences in international negotiations: the strategic use of internal side-payments

When nations negotiate, often the toughest bargaining is not between nations but within them. The reason is simple: proposed international agreements, no matter how much in the “national interest,” inevitably have differential effects on factional concerns, threatening to make winners of some and losers of others. Potential losers often have the power to prevent agreements not to their liking, thereby limiting what is possible in international negotiations. This article uses a negotiation analytic framework to analyze the consequences of such limits. It argues that limits need not be a liability for a divided country—under some circumstances they may provide a bargaining advantage—and demonstrates circumstances under which intracountry differences are desirable and undesirable from a national perspective. More specifically, the article shows that the effect of domestic differences on international negotiations depends on the configuration of domestic interests, on the nature of domestic political processes, and on characteristics of the international bargain. It then explores a particular dimension of the domestic process: the ability to link issues which allow factions to make internal side-payments. It demonstrates that internal issue linkage can have profound effects on the external bargain and explores the strategic implications of side-payments for those who would manage domestic differences in international negotiations.

Outsourcing governance: states and the politics of a ‘global value chain world’

ABSTRACT Politics, and by extension states, are marginal in debates about the genesis, evolution and functioning of the global value chain (GVC)-based global economy. We contend here that the core complexity of state agency and state power needs to be much more carefully understood in GVC and related debates, as a basis on which the governance of the evolving GVC world can be properly theorised as revolving around the inseparability of economic and political power. We advance a framework for understanding the role of politics and states in the construction and maintenance of a GVC world, using a three-fold typology of facilitative, regulatory and distributive forms of governance, and propose a notion of ‘outsourcing governance’ as an attempt to capture the ways in which states purposefully, through active political agency, have engaged in a process of delegating a variety of governance functions and authority to private actors. Our overarching argument is normative: ‘outsourced governance’ of the form we currently observe is associated with regressive distributional outcomes, and is antithetical to an inclusive and sustainable global economy.

Aid for Trade in a World of Global Value Chains: Chain Power, the Distribution of Rents and Implications for the Form of Aid

Abstract Aid for Trade is widely heralded as a success in promoting increased trade by developing countries. Increased trade, however, does not automatically translate into greater prosperity for workers or local communities. In a world characterized by global value chains (GVCs) in which large lead firms typically enjoy considerable power over their suppliers, workers and small producers are often in a poor position to capture the economic gains produced by these chains. Profits (economic rents) typically accrue to the powerful. The policy implication is that the benefits of Aid for Trade, unless targeted at enhancing the capacities of workers and small producers, or at increasing their bargaining power, may disproportionately flow to those with power in the chain and not to the intended beneficiary.

Domestic politics and the strategy of international trade

The policymaking problem in international trade is fundamentally strategic, since optimal national policy depends on what other nations choose to do. The game is not between unitary rational actors, however, but rather between players with considerable internal divisions about what policy should be. There is a rich domestic politics to international trade policymaking. Conventional wisdom holds that internal division is a liability in international interactions. This article demonstrates that if countries are divided internally between divergent interests, this will alter the outcome of strategic games between countries in, for example, setting tariffs. In particular, internal division can actually be helpful to a country, since a protectionist faction helps to make a protectionist threat more credible.

The political economy of governance in a ‘global value chain world’

ABSTRACT The global political economy has come to be shaped by a historically novel form of industrial organisation, the global value chain (GVC). Yet, although there has been much attention both to GVCs and to global governance, there has been a great deal less that connects the two. This symposium aims to take a step towards redressing this situation in order to move towards a better understanding of the political economy of governance in a ‘GVC world’. This introductory essay outlines the aims of the Symposium as being (a) to advance a more encompassing vision of politics and agency in a GVC world, (b) to understand the implications of a GVC world for global economic governance and (c) to move beyond empirical description and conceptual characterisation of forms of governance towards more explicit normative considerations of their implications for more equitable and sustainable outcomes.

Re-embedding the Market: Global Apparel Value Chains, Governance and Decent Work

Much of the global economy is now organized in global value chains that span continents and connect producers and buyers across countries. This complex and dynamic structure of economic activity has rapidly spurred the productive capacity of developing and emerging economies. Economic globalization has created a great deal of wealth for some people in some regions of the world, but rapid economic growth has also been accompanied by the expansion of precarious forms of work, particularly at the margins of the new global economy, but also within core functions and companies. It has also led to pressure on labour in more traditional centres of production.

Beyond Political Ideology: The Impact of Attitudes Towards Government and Corporations on Trust in Science:

Understanding public distrust of science is both theoretically and practically important. While previous research has focused on the association between political ideology and trust in science, it is at best an inconsistent predictor. This study demonstrates that two dimensions of political ideology—attitudes towards governments and corporations—can more precisely predict trust in science across issues. Using a survey in the United States and Germany on the science of climate change and genetically modified foods, we find that an individual’s trust in science varies across issues and that attitudes towards government and corporations are important predictors of this trust.

The Story of Risk: How Narratives Shape Risk Communication, Perception, and Policy

The organizing question of this volume is when and how events in the world lead to a recalibration of risk and a change of policy. A naïve model might assume a simple Bayesian process: the polity has regulations based on a prior assessment of risk, new information about the true risks becomes available, people update their assessments appropriately, and regulators adopt policies that minimize risks (at the lowest cost). Under some circumstances, to be fair, such a model might not be too far off the mark: in the cases of lead additives in gasoline, or drinking and driving, or smoking, viewed over a sufficiently long time period, regulatory change might be viewed as rational choice. But in myriad other cases, the path from risk to policy strays far from the policy analytic ideal.