Social Externalities: China, India, Africa
Network Grant, ESRC Rising Powers Programme, 2010-2011
Background:
The emergence of the so-called "Rising Powers" – including but not limited to China, India, Brazil and Russia - represents one of the key drivers of global economic and social change. Given the enormity of their potential impact on the global economy, they represent a priority challenge to social scientific understanding with outcomes likely to be of importance to government, business and citizens.
The market economy - and indeed the corporate economy - has always led to externalities. Such externalities can be understood as the consequences or side effects of market exchange. Externalities have been at the heart of the financial crash of 2008-09. Originally economists focused on the negative externalities of industrial commodity exchange on the welfare of the working classes. As important today are the effects of the economy on the environment. In both cases public goods must be created to compensate for market failure. Perhaps just as important are positive externalities, identified for example by Paul Krugman in urban and regional clusters, but also found in online networks. Though economists have carried out the greater part of scholarly work on externalities, these externalities are at the same time social, cultural and natural.
Our network of sociologists, economists, cultural theorists and urban geographers aimed to develop an interdisciplinary exploration of externalities. Externalities are a pressing challenge in today's global order, whose agenda is increasingly set by the 'rising powers'. In the rising powers, in particular China, we find extreme negative social and environmental externalities. Yet there is a seeming ability to avoid financial externalities; there are characteristic positive externalities of agglomeration and of a greater cultural embeddedness of economic activity.
Project:
The ESRC sponsored an international research network of scholars, designed to deepen our understanding of the regional and global impacts of the Rising Powers and the economic, political and social implications for the UK. The network shared contemporary research in order to develop collaboratively new perspectives on the emergent growth models of China, India and some parts of Africa in a context where some economic analysts and financial journalists are asking if the 'Washington Consensus' is increasingly displaced by a 'Beijing consensus'.
In three workshops over 12 months the network addressed issues of urban change, south-south flows and new models of financial governance. It adopted an interdisciplinary focus on the conceptualisation of 'externalities' to provide a lens through emergent trends could be framed.
This network explored such 'social externalities' in the rising powers, especially China and in the UK and the West. It looked at the social, financial and environmental consequences of the accelerated growth in the rising powers and at the various types of public goods that have emerged in response.
The question of externalities and public goods also applies to the West. In the aftermath of 2008-09, Keynesian ideas have suitably re-emerged on a very large scale. Yet the classical Keynesian response may no longer be appropriate and we may need to re-think the problem of public goods. The Keynesian response to the Great Depression's negative externalities was in the context of an extensive and mobilised industrial working class and unchallenged dominance of the West. Today's response of arguably post-Keynesian public goods involves is a largely information and service economy, environmental crisis and the rise of the East and South. Economists have understood market transactions and their externalities in terms of utilitarian, benefit-maximizing action. Yet in today's 'risk society' (Beck) - when externalities are perhaps less the exception than the rule - at stake is not just a utilitarian, but a more fundamental engagement with nature, culture and society. In China and other rising powers, economic transactions may be less utilitarian and individualist than in the West and more embedded in collective, relational and communal ties. This cultural embeddedness is central to very different notions of property and contract which may also be a basis of their success. This network would also explore this extra-economic socio-cultural embeddedness.
This network involved three workshops - in China, India and the UK, and attached visiting fellows from China, India and the UK. The workshops balanced different approaches from academics and stakeholders - policymakers, business, urban planners and NGOs.
Full list of participants in some or all of the workshops (.pdf).
Researchers:
Michael Keith and Scott Lash (Goldsmiths)
Events:
Full details of workshop 1 - Beijing, 8th-9th October 2010
Full details of workshop 2 - Delhi, 11th-12th February 2011
Full details of workshop 3 - London, 10th - 11th June 2011
Rising Powers Working Papers:
The following papers are works in progress that have arisen from the discussions at the Rising Powers workshops.
The Politics of Externalities: Neo-Liberalism, Rising Powers and Property Rights, William Davies
Externalities, Urbanism and Pirate Modernities: India
Ravi Sundaram
From Chongqing to Shenzhen and Back: The Evolving "China Model"
Jiang Jun