Periodic Reporting for period 2 - PERIGROWTH (States, firms and, sustainable economic growth: A view from the periphery)
Periodo di rendicontazione: 2020-01-01 al 2020-12-31
"This project explores the role of state-firm coordination in enabling late industrializing economies to reach the efficiency frontier in complex (skill-, capital- and knowledge-intensive) industries. The underlying motivation of this project was to explain late stages of economic development in the context of globalization. The study was based on empirical analyses of two countries that have become advanced economies in the past four decades by increasing the complexity of their production structures, Spain and South Korea (Korea). the research was based on qualitative case studies of three complex upstream industries that are central to both national economies: information and communication technologies (ICT), banking, and the automotive industry. The analysis focused on the period between 1985 and 2019.
In the past four decades only 21 countries have managed to increase their standard of living from somewhere between 20-50 percent of the US GDP per capita to above 50 percent of the US income per capita level. Of these new advanced economies,
8 continue to have economies that are heavily dependent on extractive industries or agriculture, and only three (Spain, Korea and Taiwan), are the home base of at least one lead firm that controls the process of design, production and distribution of a global production network, has global market power, and a recognizable brand name. The scarcity of countries that have managed to overcome the so-called middle-income trap makes examples of countries that have done so, valuable to gain a better understanding of this process and the types of approaches that new generations of emerging economies could pursue to achieve similar outcomes.
The overall objective of the project was to gain a better understanding of how late industrializing economies become advanced countries using the experiences of Spain and Korea.
The research showed that upgrading is a coordination problem in which the key actors are states and firms. We argued that that upgrading in Spain and Korea was based on quid pro quo exchanges and interdependences between states and firms. In these interdependent models, national governments and firms exercised control over their decisions and came to develop a set of mutually agreed-upon working rules that enabled both parties to reach beneficial outcomes. The project defined to different, yet equifinal pathways to upgrading, an ""integrational"" path based on foreign direct investment, technological outsourcing and regional integration, and a ""techno-industrial"" one, based on self-sufficiency and technological autonomy."
In the past four decades only 21 countries have managed to increase their standard of living from somewhere between 20-50 percent of the US GDP per capita to above 50 percent of the US income per capita level. Of these new advanced economies,
8 continue to have economies that are heavily dependent on extractive industries or agriculture, and only three (Spain, Korea and Taiwan), are the home base of at least one lead firm that controls the process of design, production and distribution of a global production network, has global market power, and a recognizable brand name. The scarcity of countries that have managed to overcome the so-called middle-income trap makes examples of countries that have done so, valuable to gain a better understanding of this process and the types of approaches that new generations of emerging economies could pursue to achieve similar outcomes.
The overall objective of the project was to gain a better understanding of how late industrializing economies become advanced countries using the experiences of Spain and Korea.
The research showed that upgrading is a coordination problem in which the key actors are states and firms. We argued that that upgrading in Spain and Korea was based on quid pro quo exchanges and interdependences between states and firms. In these interdependent models, national governments and firms exercised control over their decisions and came to develop a set of mutually agreed-upon working rules that enabled both parties to reach beneficial outcomes. The project defined to different, yet equifinal pathways to upgrading, an ""integrational"" path based on foreign direct investment, technological outsourcing and regional integration, and a ""techno-industrial"" one, based on self-sufficiency and technological autonomy."
"Primary and secondary data collection:
Secondary data collection took place in years and and two in the US, Spain and Korea.
Outputs:
2019 article commissioned by the Spanish Economic office in Seoul
2021 article, New Political Economy
2021 book manuscript Oxford University Press.
Invited presentations:
2021 Henley Business School
2020 Harvard University,
2020 London School of Economic, European Institute (cancelled )
2020 King's College London (cancelled)
2019 Kings College London
2019 Yonsei University
2019 Seoul National University
2019 Harvard Kennedy School of Government
2019 Harvard Korea Institute
2019 Government of Spain, Economic office of Seoul
2018 University of California San Diego
Conferences presentations:
2020 Academy for International Business
2020 Academy for International Business UK Chapter (cancelled)
2020 Gerpisa
2019 Society for the Advancement of Socioeconomics
2019 Academy of Management
2018 Society for the Advancement of Socioeconomics
Diffusion to undergraduate and graduate students
2019 University of California San Diego
2019 University of California San Diego
2018 London School of Economics
Training:
2019 Course on International Trade at Harvard
2019 Qualitative research methods at the University of Syracuse
2018 Intellectual property rights, European Patent Academy
2018 Qualitative research methods at UC San Diego
2018 Basic course on Korean language
Overview of results, exploitation and dissemination : The research resulted in a book manuscript titled ""State-firm coordination and upgrading"", that is currently in production by Oxford University press, a published paper in New Political Economy, a second paper that is currently under review, and a third draft paper. Results have been disseminated through a series of conferences, seminars, and guest lectures detailed above attractive a wide range of technical and non-technical audiences."
Secondary data collection took place in years and and two in the US, Spain and Korea.
Outputs:
2019 article commissioned by the Spanish Economic office in Seoul
2021 article, New Political Economy
2021 book manuscript Oxford University Press.
Invited presentations:
2021 Henley Business School
2020 Harvard University,
2020 London School of Economic, European Institute (cancelled )
2020 King's College London (cancelled)
2019 Kings College London
2019 Yonsei University
2019 Seoul National University
2019 Harvard Kennedy School of Government
2019 Harvard Korea Institute
2019 Government of Spain, Economic office of Seoul
2018 University of California San Diego
Conferences presentations:
2020 Academy for International Business
2020 Academy for International Business UK Chapter (cancelled)
2020 Gerpisa
2019 Society for the Advancement of Socioeconomics
2019 Academy of Management
2018 Society for the Advancement of Socioeconomics
Diffusion to undergraduate and graduate students
2019 University of California San Diego
2019 University of California San Diego
2018 London School of Economics
Training:
2019 Course on International Trade at Harvard
2019 Qualitative research methods at the University of Syracuse
2018 Intellectual property rights, European Patent Academy
2018 Qualitative research methods at UC San Diego
2018 Basic course on Korean language
Overview of results, exploitation and dissemination : The research resulted in a book manuscript titled ""State-firm coordination and upgrading"", that is currently in production by Oxford University press, a published paper in New Political Economy, a second paper that is currently under review, and a third draft paper. Results have been disseminated through a series of conferences, seminars, and guest lectures detailed above attractive a wide range of technical and non-technical audiences."
The project provides a new perspective on economic transformation that transcends the classic market versus state approach by characterizing upgrading as a coordination problem between states and large firms. This characterization accommodates the idea of policy variation, which helps explain why late industrializing may pursue different pathways to upgrading. The project characterized two alternative strategies: one based on technological autonomy, self-sufficiency, and control of value chains, and another based on technological outsourcing, foreign direct investment and regional integration.
I introduced a new methodological approach to study economic transformation based on a three-tiered structure that looked at firms, industries, and countries. The analysis was based on the view that firms stand at the centre of economic transformation because they generate the type of wealth and high-quality jobs that underpin upgrading. However, firms operate within a context defined by two different types of institutions: those derived from the competitive dynamics of their industry, and those derived by the political dynamics of the country in which they are based.
The analysis shows that neither firms nor states are able to accomplish their objectives without cooperation with one another, yet they often have compatible objectives that underpin coordination models based on quid pro quo exchanges in which each actor helps further the other’s goals and both together can bring about upgrading. The country analysis further revealed that while national governments may have common goals their priorities and the strategies to fulfill them stem from differences in the identities and capabilities of public decision makers. The project characterized two types of governments: generalists and techno-industrial, and argued that these types of governments had preferences for different pathways to upgrading. The research showed that upgrading strategies were also underpinned by broader socioeconomic and structural factors including the overlap between local business elites and insider industries, clear goals and strategic guidelines supported by large social consensuses, and public investment in a vast array of public goods.
I introduced a new methodological approach to study economic transformation based on a three-tiered structure that looked at firms, industries, and countries. The analysis was based on the view that firms stand at the centre of economic transformation because they generate the type of wealth and high-quality jobs that underpin upgrading. However, firms operate within a context defined by two different types of institutions: those derived from the competitive dynamics of their industry, and those derived by the political dynamics of the country in which they are based.
The analysis shows that neither firms nor states are able to accomplish their objectives without cooperation with one another, yet they often have compatible objectives that underpin coordination models based on quid pro quo exchanges in which each actor helps further the other’s goals and both together can bring about upgrading. The country analysis further revealed that while national governments may have common goals their priorities and the strategies to fulfill them stem from differences in the identities and capabilities of public decision makers. The project characterized two types of governments: generalists and techno-industrial, and argued that these types of governments had preferences for different pathways to upgrading. The research showed that upgrading strategies were also underpinned by broader socioeconomic and structural factors including the overlap between local business elites and insider industries, clear goals and strategic guidelines supported by large social consensuses, and public investment in a vast array of public goods.