Chicagoer Schule der Sozialgeographie

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The social and economic dimension of the
European Neighbourhood Policy
Prof. Dr. Zoltán Cséfalvay Andrássy Gyula
Deutschsprachige Universität Budapest
zoltan.csefalvay_at_andrassyuni.hu
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The social and economic dimension of the
European Neighbourhood Policy

• Stages of the regional economic integration
• The long way from the first into the second
  international division of labour
• A mixture of development paths - the third
  international division of labour
• The European economic continental block is
  emerging

Prof. Dr. Zoltán Cséfalvay Andrássy Gyula
Deutschsprachige Universität Budapest,
zoltan.csefalvay_at_andrassyuni.hu
3

• The stages of the regional economic integration
  (Béla Balassa)
• Free Trade Zone customs were abolished within
  the member-states of the zone, but every country
  has its own customs regime against the
  non-member-sates
• Customs Union customs were abolished within the
  member-states of the zone, and every country has
  the same customs regime against the non-member
  states

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• The stages of the regional economic integration
  (Béla Balassa)
• Single (Common) Market customs were abolished
  within the member-states of the zone, and every
  country has the same customs regime against the
  non-member states, and there is a free move of
  production factors (e. g. labour, capital,
  information) within the member-states of the zone
• Economic Union customs were abolished within
  the member-states of the zone, and every country
  has the same customs regime against the
  non-member states, and there is a free move of
  production factors (e. g. labour, capital,
  information) within the member-states of the
  zone, and the member-states develop a common
  framework for economic policy (e. g. agriculture
  policy, competition policy)

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The stages of the regional economic integration
(Béla Balassa)
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• Organisations for regional economic integration
  in America

• 1994 NAFTA (North American Free Trade
  Agreement), member-states are Mexico, USA,
  Canada, works as a free trade zone.
• 1991 MERCOSUR (Mercado Commun del Sur),
  member-states are Argentina, Brazil, Paraguay,
  Uruguay, Chile, Bolivia, works as a customs
  union.
• 1990 ANCOM (Andean Common Market), member-states
  are Bolivia, Columbia, Ecuador, Peru, Venezuela,
  works as a customs union.

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• Organisations for regional economic integration
  in Asia

• 1993 AFTA (ASEAN /Association of South East
  Asian Nations/ Free Trade Agreement), member
  states are Brunei, the Philippines, Indonesia,
  Malaysia, Singapore, Thailand, works as a free
  trade zone.
• 1989 APEC ( Asia-Pacific Economic Cooperation),
  member-states are Australia, Brunei, Chile, South
  Korea, USA, the Philippines, Hong Kong,
  Indonesia, Japan, Canada, China, Malaysia,
  Mexico, Russia, Papua New-Guinea, Peru,
  New-Zeeland, Singapore, Taiwan, Thailand,
  Vietnam, after 2010 will work as a free trade
  zone
• APEC A Perfect Excuse to Chat?

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• Organisations for regional economic integration
  in Europe

• 1951 Montanunion (European Coal and Steel
  Community, ECSC) member-states are France,
  Germany, Italy, Belgium, the Netherlands,
  Luxemburg,
• 1957 (Treaty of Rome) European Economic
  Community (EEC)
• 1958 works as a free trade zone
• 1968 works as a customs union
• 1991 (Treaty of Maastricht) European Union
  works as a single market
• 1999 works as an economic union (e. g. the euro
  will have become the common currency)

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• Benefits joining the regional economic
  integration in Europe

• Effects of free trade mutual gains resulting by
  abolishing the trade barriers
• Effects of single market mutual gains resulting
  by producing for a large market (economy of
  scale)
• Effects of free mobility mutual gains resulting
  by mobility of the production factors (capital,
  labour, etc.)
• Effects of solidarity mutual gains resulting by
  financial support the less developed countries.

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The social and economic dimension of the
European Neighbourhood Policy

• Stages of the regional economic integration
• The long way from the first into the second
  international division of labour
• A mixture of development paths - the third
  international division of labour
• The European economic continental block is
  emerging

Prof. Dr. Zoltán Cséfalvay Andrássy Gyula
Deutschsprachige Universität Budapest,
zoltan.csefalvay_at_andrassyuni.hu
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First international division of labour

• Time 1800-1970
• inter-industry division of labour
• Countries had specialised on products and braches
  with comparative advantages (David Ricardo)

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Second international division of labour

• Time 1975-1995
• Driving forces Lowering transaction cots via new
  transport and communication technologies
• Widening the organisational structure of the
  companies on world-wide scale
• Centre - the highest level of the organisation
  long-term planning, strategic management, overall
  control,
• Semi-Periphery - the middle level of the
  organisation highly automatic steeps of
  productions with high skilled workers
• Periphery - the lowest level of organisation
  standardised mass production with low skilled
  workers (assembly line production)

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Second international division of labour

• Time1975-1995
• intra-industry (intra-firm) division of labour,
• Driving forces trans-national companies (TNCs)
• How does it work? Shifting low value-added mass
  production in the peripheral regions of the world
  economy
• Consequences newly industrialized countries
  (NIC), emerging markets

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Fundamental change of the economic policy in the
developing countries

• Import-Substitution Industrialisation (ISI)
• Raúl Prebisch (President of the National Bank in
  Argentina) in the 1930th
• Objective Fostering home-grown industries which
  products earlier were imported
• Tools exchange rates, customs for import,
  support of enfant industries with
  multiplication effects
• Results development of a home-grown industrial
  base, but weak international competitiveness of
  the companies because of the missing
  international competition.

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Fundamental change of the economic policy in the
developing countries

• Export-Led Growth (ELG)
• New trends after 1980 Fostering the foreign
  direct investments, especially those, which
  produce for export
• Theoretical background Washington Consensus
  (John Williamson)
• Results export, GDP, and employment grow, but
  modernisation remains regionally very restricted
  (missing multiplication effects)

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Regional hierarchy of the world economy
Immanuel Wallerstein

• Uneven - but regionally very differentiated -
  global expansion of market system since the 15th
  century
• Stage in the economic development (and welfare),
  and
• Stage in the regional hierarchy and the structure
  of dependence

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The regional structure of the world economy 1800
Quelle P. L. KNOX u. S. A. MARSTON, 2001, S. 67
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The regional structure of the world economy 1900
Quelle P. L. KNOX u. S. A. MARSTON, 2001, S. 67
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The regional structure of the world economy 2000
Quelle P. L. KNOX u. S. A. MARSTON, 2001, S. 67
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Jack Welshs Paradigm
The winners in these global games will be those
who can put together the worlds best in design,
manufacturing, research, execution, and marketing
on the largest scale. Rarely are all of these
elements found in one country or on one
continent. Welch, Jack F. Jr. (1987) Evolving
Industrial Alliances. The Bridge, 17(4), S. 10.
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The power of the triad Kenichi Ohmae
22
ESRC (2003) Globalizing Regional Development A
Global Production Network Perspecticve. GNP
Working Paper 3, May, ESRC Research Project
R000238535 Making the Connections Global
Production Networks in Europe and East Asia.
http//www.art.man.ac.uk/Geog/gpn/pdfs/gpnwp3.pdf
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The social and economic dimension of the
European Neighbourhood Policy

• Stages of the regional economic integration
• The long way from the first into the second
  international division of labour
• A mixture of development paths - the third
  international division of labour
• The European economic continental block is
  emerging

Prof. Dr. Zoltán Cséfalvay Andrássy Gyula
Deutschsprachige Universität Budapest,
zoltan.csefalvay_at_andrassyuni.hu
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Third international division of labour

• The role of a given country in the international
  division of labour will be determined by the mode
  of transition from fordist-type mass production
  into post-fordist type flexible production and
  regulation.
• Countries are integrated in continental blocks
  according their mode of transition
• Regionally the continental blocks organised in a
  centre-periphery pattern

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Mode of transition from fordist-type mass
production into post-fordist type flexible
production and regulation ALAIN LIPIETZ

• FLEXIBILITY
• in the production (intern flexibility)
• in the economic policy (extern flexibility)

• Flexibility in the production better use of
  time and space, such as lean production, just in
  time, total quality control, total quality
  management, CAD/CAM, etc.)
• Flexibility in the economic policy
  privatisation, deregulation, liberalisation

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Mode of transition from fordist-type mass
production into post-fordist type flexible
production and regulation in the developed
countries
Kalmarism low flexibility in economic policy
(welfare state by regulation of wages via mass
corporations) high flexibility in
production German model low flexibility in
economic policy (welfare state by regulation of
wages via industries) high flexibility in
production Toyotism low flexibility in
economic policy (welfare state by regulation of
wages via companies) high flexibility in
production Neotaylorism high flexibility in
economic policy (liberalisation) low
flexibility in production (taylorism)
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Mode of transition from fordist-type mass
production into post-fordist type flexible
production and regulation in the developing
countries

• primitive (bloody) Taylorism
• low flexibility in production (taylorism) high
  flexibility in economic policy
• the lowest level of organisation - standardised
  mass production with low skilled workers
  (assembly line production)
• peripheral Fordism
• low flexibility in production (taylorism) high
  flexibility in economic policy
• the lowest level of organisation - standardised
  mass production with low skilled workers
  (assembly line production)
• the middle level of the organisation highly
  automatic steeps of productions with high skilled
  workers

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Kalmarism welfare state by regulation of wages
via mass corporations flexibility in
production German model welfare state by
regulation of wages via industries flexibility
in production Toyotism welfare state by
regulation of wages via companies flexibility
in production Neotaylorism high flexibility
in economic policy (liberalisation) low
flexibility in production (taylorism) Peripheral
Fordism high flexibility in economic policy
(liberalisation) low flexibility in production
(taylorism) highly automatic steps of
productions with high skilled workers and
standardised mass production with low skilled
workers Primitve (bloody) taylorism high
flexibility in economic policy (liberalisation)
low flexibility in production (taylorism)
standardised mass production with low skilled
workers
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The social and economic dimension of the
European Neighbourhood Policy

• Stages of the regional economic integration
• The long way from the first into the second
  international division of labour
• A mixture of development paths - the third
  international division of labour
• The European economic continental block is
  emerging

Prof. Dr. Zoltán Cséfalvay Andrássy Gyula
Deutschsprachige Universität Budapest,
zoltan.csefalvay_at_andrassyuni.hu
31
Third international division of labour

• The role of a given country in the international
  division of labour will be determined by the mode
  of transition from fordist-type mass production
  into post-fordist type flexible production and
  regulation.
• Countries are integrated in continental blocks
  according their mode of transition
• Regionally the continental blocks organised in a
  centre-periphery pattern

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The social and economic dimension of the
European Neighbourhood Policy
THANK YOU FOR YOUR KIND ATTENTION!
Prof. Dr. Zoltán Cséfalvay Andrássy Gyula
Deutschsprachige Universität Budapest
zoltan.csefalvay_at_andrassyuni.hu