《可持续发展的理论与实践》（英文版） Lecture 19 NETWORK ECONOMIES

NETWORK ECONOMIES Lecture 19 NETWORK ECONOMIES iness network bamboo” network smuggling human trafficking Voluntary- local chamber of commerce, rotary, country club, etc Compulsory -belong to an organization, survive or operate successfully e.g. accountant bankers Concept of networks Socially binding ties between actors Diaspora-Jews. Indians. Chinese Global tribes- combination of ethnic identity, geographical dispersion and open mindedness. apanese business networks complex combinations of overlapping relationships between large firms zaibatsu to keiretsu large Chaebols Simpler than Japanese. Focus on product market relatedness and vertical integration. 1. Paternalism- benevolent authority of the father 2. Personal ism-connections with persons who can be trusted. doing business 3. Insecurity-besieged minority focuses on persuit of wealth Overseas chinese and Indian business networks in s and se asia 1. Little differentiation between controlling families and the firms 2. The firms have very strong familial and informal networks 3. The firms exhibit good relationships with public sectors in these countries 4. Highly diversified Strategic management style (Indian/Chines 1. Hands-on experience 2. Lateral transfer of knowledge Managers often have difficulties making decisions within new environmental context 3. Qualitative information Network managers almost always use external sources of information in making strategic decisions 4. Holistic information processing Conventional, analytical problem solving 5. Action-driven decision making Speed Overseas Chinese networks 3 different, difficult stages 1. Rags to riches eft mainland with little wealth To SE Asia, Taiwan, HK 2. Internationalization of the family business achieved a uniquely Chinese basis 3. Turnaround massive investment by overseas Chinese capitalists to establish new businesses in their original home, or that of their parents and grandparents. Providing 3 essential ingredients 2. risk-taking capital investment 3. business management capability Generalizations 1. Most overseas Chinese take a low profile in the commercial world shy away from publicity 2. Rely on strict, centralized control and informal transactions to minimize company bureaucracy and 3. The successful overseas Chinese business family operates through a network of enterprises rather than the

NETWORK ECONOMIES 1 Lecture 19 NETWORK ECONOMIES Business network “bamboo” network smuggling human trafficking Voluntary - local chamber of commerce, rotary,, country club, etc Compulsory - belong to an organization,, to survive or operate successfully e..g.. accountant, bankers.. Concept of networks - Socially binding ties between actors Diaspora - Jews, Indians, Chinese Global tribes- combination of ethnic identity, geographical dispersion and open mindedness.. Japanese business networks - complex combinations of overlapping relationships between large firms zaibatsu to keiretsu Korean business networks large Chaebols –– Simpler than Japanese.. Focus on product- market relatedness and vertical integration.. Chinese networksstrongly influenced by family ties Guanxi 3 dominant and consistent influences:: 1.. Paternalism - benevolent authority of the father 2.. Personalism - connections with persons who can be trusted, doing business 3.. Insecurity - besieged minority focuses on persuit of wealth Overseas Chinese and Indian business networks in S and SE Asia:: 1.. Little differentiation between controlling families and the firms 2.. The firms have very strong familial and informal networks 3.. The firms exhibit good relationships with public sectors in these countries 4.. Highly diversified Strategic management style (Indian / Chinese) 1.. Hands-on experience 2.. Lateral transfer of knowledge - Managers often have difficulties making decisions within new environmental context 3.. Qualitative information - Network managers almost always use external sources of information in making strategic decisions 4.. Holistic information processing - Conventional, analytical problem solving 5.. Action-driven decision making - Speed Overseas Chinese networks 3 different, difficult stages:: 1.. Rags to riches Left mainland with little wealth To SE Asia, Taiwan, HK 2.. Internationalization of the family business - achieved a uniquely Chinese basis 3.. Turnaround - massive investment by overseas Chinese capitalists to establish new businesses in their original home, or that of their parents and grandparents.. Providing 3 essential ingredients:: 1.. Entrepreneurship 2.. risk-taking capital investment 3.. business management capability Generalizations 1.. Most overseas Chinese take a low profile in the commercial world shy away from publicity.. 2.. Rely on strict, centralized control and informal transactions to minimize company bureaucracy and paperwork 3.. The successful overseas Chinese business family operates through a network of enterprises rather than the

NETWORK ECONOMIES nitary company(e.g. Ford Maintain varying percentage interests in a galaxy of small to medium-sized firms 4. Overseas Chinese business leaders utilize a management style that is more informal and intuitive than that practised in a typical Western corporation Nature of overseas chinese networks in asi I Massive cross-investment among these nations In. s. vibrant business activity in HK, Taipei, Singapore, Bangkok, KL, Jakarta, Manila, Ho Chi Minh, etc Indonesia overseas Chinese make up 3-4% population yet 70% of private domestic capital run more than 160 of 200 largest Malaysia ethnic Chinese control half of the nations corporate assets Philippines- ethnic Chinese 2% of population, but control over 1/3 of 1 000 largest corporations Differences among overseas Chinese population in Asia: 1. HK, Singapore- British traditions of governance 2. Taiwan-American and Japanese political and 3. ASEAN- ethnic minorities but powerful in business 4. Coastal China overseas Chinese with indigenous Chinese in a hybridized market/ centrally planned environment Trafficking business goods(cigarettes, electronics, liquor, etc) banned goods(drugs, firearms, endangered etc) Globalization of international migration orth-South gap life expectancy, demography, economic structure, social conditions, political stability. Rich and Oil-rich Arab States, E. Asia International migration mostly intra-regional, but also to industrial democracies s Globalization has brought people together, but also new forms of organized crime s Income disparities, labour and migration policies of sending and receiving countries Environmental degradation Push- Pull factors Economic disparities between societies, different levels of development 2. Asylum seekers and refugees 3. Historical changes in E. Europe and former Soviet Union 4. Removal of internal border controls in Eu 5. Women being sold into sex-trade industry 6. Demographic shifts require people to move for employment 7. Available"cross-national networks". Illegal 8. Environmental degradation 9. Government policies manipulate population for"larger" policy related interests U.S.A.. important net recipient of migrants, largest EU- changed from emigration nations to receiving net flows(last 4 decades) Japan- net migration traditionally negligible. Since 1998, received 270,000 arrivals Restrictions eased Family reunion to demand towards skilled workers, technicians, engineers legal immigration ( human traffick Modern day slave trade harsh, uncertain, expensive Golden venture, New York City 1993 300 stowaways Dover, 2000, 54 Chinese men, 4 women 2 survivors Rich countries have a real economic demand for labour Developing countries have a generous surplus China a major source of illegal migration 100,000 smuggled abroad each year, earning $3 billion for trafficking syndicates

NETWORK ECONOMIES 2 unitary company (e..g.. Ford) Maintain varying percentage interests in a galaxy of small to medium-sized firms 4.. Overseas Chinese business leaders utilize a management style that is more informal and intuitive than that practised in a typical Western corporation.. Nature of overseas Chinese networks in Asia:: 1.. Massive cross––investment among these nations 2.. Vibrant business activity in HK, Taipei, Singapore,, Bangkok, KL, Jakarta,, Manila, Ho Chi Minh, etc Indonesia - overseas Chinese make up 3 - 4% population yet 70% of private domestic capital run more than 160 of 200 largest businesses.. Malaysia - ethnic Chinese control half of the nation’s corporate assets Philippines - ethnic Chinese 2% of population, but control over 1/3 of 1,000 largest corporations Differences among overseas Chinese population in Asia:: 1.. HK, Singapore - British traditions of governance 2.. Taiwan - American and Japanese political and economic philosophy 3.. ASEAN - ethnic minorities but powerful in business 4.. Coastal China - overseas Chinese with indigenous Chinese in a hybridized market / centrally planned environment Trafficking Business - goods (cigarettes, electronics, liquor, etc) - banned goods (drugs, firearms, endangered species, etc) - currencies - people Globalization of international migration North-South gap - life expectancy, demography, economic structure, social conditions, political stability.. Rich and poor Oil-rich Arab States, E.. Asia International migration mostly intra-regional, but also to industrial democracies ❖ Globalization has brought people together, but also new forms of organized crime ❖ Income disparities, labour and migration policies of sending and receiving countries ❖ Environmental degradation Push -- Pull Factors 1.. Economic disparities between societies, different levels of development 2.. Asylum seekers and refugees 3.. Historical changes in E.. Europe and former Soviet Union 4.. Removal of internal border controlsin EU 5.. Women being sold into sex-trade industry 6.. Demographic shifts require people to move for employment 7.. Available “cross-national networks”.. Illegal 8.. Environmental degradation 9.. Government policies manipulate population for “larger” policy related interests Trends in International Migration U..S..A.. - important net recipient of migrants, largest gross recipient EU - changed from emigration nations to receiving net flows (last 4 decades) Japan - net migration traditionally negligible.. Since 1998, received 270,000 arrivals.. Restrictions eased Family reunion to demand towards skilled workers, technicians, engineers Illegal immigration (human trafficking) Modern day slave trade - harsh, uncertain, expensive Golden venture, New York City 1993, 300 stowaways Dover, 2000, 54 Chinese men, 4 women, 2 survivors Rich countries have a real economic demand for labour Developing countries have a generous surplus China a major source of illegal migration 100,000 smuggled abroad each year, earning $3 billion for trafficking syndicates

NETWORK ECONOMIES lobal picture Each year, 400,000-500,000 smuggled into EU 300.000 USA 1999 11.000 Chinese claimed asylum in EU 1/4 applied in UK Women smuggling young, mostly from E&C Europe Russian, trafficking women yielded $7 billion annually Snakeheads Worldwide, 50 gangs handle human trafficking Illicit trade- take documents, visas, passports, How much to pay? ☆ Chinese USS50, 000 for journey to US US$20,000 for journey to Europe US$10, 000 for journey to Japan 令 Filipino to Kuwait $3,000 Bangladesh to Germany $4,000-6,000 令 Morocco to Spain $500(boat) Mexican across border to LA $200-400 ☆ Afghan or Lebanese to $5,000-$10,000 Germany Global mafia Chinese and vietnamese triads S. America cartels Italian, Russian and other European mafias International strategic alliances and collaborations with local criminal networks w Gangs earn USS5-7 billion in profits each year from human trafficking, according to UN International on ofm (10M). Other estimate, $12 billi o 5 years for illegal migrants to pay off debt- prostitutes or soldiers for illegal gangs

NETWORK ECONOMIES 3 Global picture Each year, 400,000 - 500,000 smuggled into EU 300,000 into USA 1999 11,000 Chinese claimed asylum in EU, 1/4 applied in UK Women smuggling young, mostly from E&C Europe 300,000 a year, mostly sex trade Russian, trafficking women yielded $7 billion annually Snakeheads Worldwide, 50 gangs handle human trafficking Illicit trade - take documents, visas, passports, money-laundering How much to pay? ❖ Chinese :: US$50,000 for journey to US US$20,000 for journey to Europe US$10,000 for journey to Japan ❖ Filipino to Kuwait $3,000 ❖ Bangladesh to Germany $4,000 - 6,000 ❖ Morocco to Spain $500 (boat) ❖ Mexican across border to LA $200 - 400 ❖ Afghan or Lebanese to $5,000 - $10,000 Germany Global mafia Chinese and Vietnamese triads Japanese Yakuza S.. America cartels Italian,, Russian and other European mafias International strategic alliances and collaborations with local criminal networks ❖ Gangs earn US$5 - 7 billion in profits each year from human trafficking, according to UN International Organization of Migration (10M).. Other estimate, $12 billion ❖ 5 years for illegal migrantsto pay off debt –– prostitutes or soldiers for illegal gangs