The Chair in a snapshot
The Canada Research Chair in International and Comparative Political Economy (CRÉPIC), held by Professor Stéphane Paquin, is dedicated to two main research focuses.
The first research focus centres on the relationship between the state and the market, and especially on the resilience of governments – in particular, those of the social-democratic countries – as they confront globalization. It also takes up the question of the variety of models of capitalism along with the issue of government reform in the OECD countries.
The second research focus embraces international negotiations, federalism and multi-level governance. Furthermore, it specifically covers the role of federated states in the negotiation and implementation of international treaties, particularly those governing trade and climate change.
Globalization, the resilience of governments, and the variety of models of capitalism
Globalization, global competition and the success of liberalism have prompted several researchers to assert that the various existing models of capitalism have been converging toward the neoliberal model, reputed as being the best able to perform in the context of globalization. However, the projections stemming from these theories have only rarely been verified empirically. Therein lies the overarching objective pursued by the Chair in relation to this research focus – namely, to perform a deeper comparison of models of capitalism in order to validate their persistence as well as the resilience of social-democratic models grappling with globalization. The main thrust of this focus will be to create a major base of comparative data. The results of this research will afford many lessons concerning the resilience of governments in dealing with globalization and will provide valuable insights to policymakers about reforms worth pursuing.
Globalization, international negotiations and federalism
The general objective of this research focus is to grasp the impact of federalism on international negotiations and the role of federate states in the negotiations and implementation of international treaties. A further specific objective is to develop a theory of the effects of federalism, the effects of the division of powers between federal governments and federated states, on international negotiations. The results of this research will shed light on debates in international economics regarding the role of internal institutions in the negotiation and implementation of international commitments.
Focus 1: Globalization, the resilience of governments, and the variety of models of capitalism
The effects of globalization on governments have been the subject of numerous studies since the late 1960s. In the view of most authors, globalization and public policy are two conflicting notions: government action occurs within a well-defined territorial framework whereas globalization is, by definition, a phenomenon extending beyond borders. Globalization has reduced the capacity for state intervention, increasingly forcing governments to adopt policies of a neoliberal cast.
Beginning in 1968, R. N. Cooper popularized the concept of economic interdependence and, in the years since, most globalization research has emphasized the growing vulnerability of governments to this phenomenon. Even as early as 1969, C. Kindleberger asserted that “the nation state is just about through as an economic unit.” In the 1980s, the sociologist D. Bell wrote, “The national state has become too small for the big problems in life and too big for the small problems of life.” In 1996, K. Ohmae prophesied the end of the nation-state and the rise of region states, and not long afterward, J. Mulvale argued that “the growing reach of global capital […] brought an end to the social-democratic welfare state project.” Finally, T. Friedman declared that “the world is flat,” in reference to the complete transformation of global affairs. In his view, governments must quickly adapt to the global economy and, in particular, to Asian competition and offshoring.
In contrast, other researchers have spoken of the resistance of governments or the return of the state. Those claiming that globalization heralds the end of the state frequently fail to identify the mechanisms by which this phenomenon affects the capacity of government; as a result, they have also considerably exaggerated the impacts of globalization. In addition, empirical evidence does not bear out the hypothesis of neoliberal convergence but instead shows the persistence of a range of models of capitalism. According to Bruno Amable, four models of capitalism have persisted in the West: 1) the neoliberal model (e.g., United States, Canada, Great Britain); 2) the Mediterranean model (e.g., Italy, Spain); 3) the Continental model (e.g., German, France); 4) and the social-democratic model (Sweden, Denmark, Finland).
According to several experts, Sweden, Denmark and Finland have unequivocally disproved the thesis of the inevitable decline of social models and shown that small interventionist states have been able to adapt in an increasingly competitive global economy. Whereas these three countries were scrambling to make do in the early 1990s, they subsequently managed to bounce back – to the point of becoming reference models. Their main achievement – referred to by the term of “flexicurity” – has been to find a way of increasing the security provided to individuals through large-scale, interventionist social policies while also giving businesses and the economy the flexibility they require in order to adapt and perform. These countries also succeeded in increasing the productivity of their governments.
Focus 2: Globalization, international negotiations and federalism
Contemporary globalization has spurred the implementation of international rules and institutions designed, in particular, to make the world stable and more predictable. During the period extending from 1946 to 2006, the number of international treaties rose from 6,351 to 158,000. Moreover, many authors believe that in order to govern globalization more effectively, global regulatory mechanisms will have to be strengthened, namely through the conclusion of international treaties. International negotiations have, as a result, become a core component of the globalization process. At the same time, there has been a significant increase in the number of federal systems throughout the world. For example, immediately following World War II, Europe was home to only two genuinely federal nations, whereas in our time, 19 of the 27 Member States of the European Union have been witness to considerable growth in their regional governments, such that some countries now possess full-fledged federal systems. Approximately 40% of the world’s population lives in states that could be qualified as being federal.
The consequence of these two phenomena is that, now, all areas of government activities – even those of federated states and municipalities – fall within the jurisdiction of at least one intergovernmental organization. As a result, international organizations and thematic conferences cover topics relating to the environment, free trade, government contracts, education, public health, cultural diversity, business grants, the treatment of investors, the elimination of non-tariff barriers, agriculture, services, etc. Federated states are increasingly aware that their political power or sovereignty – i.e., their capacity to develop and implement policies – has become the subject of negotiations in these international multilateral forums. In response, since the period running from 1960 to 1980, the number of federated states actively participating stakeholders in international issues has grown considerably.
Federated states have become indispensable players in international negotiations as the result of the increasingly stronger impacts that such talks have produced on their areas of jurisdiction. From the outset of the most important trade negotiations undertaken by Canada since the Free Trade Agreement – namely, negotiations between Canada and the European Union – the provinces have assumed a greater role. Indeed, the European Union required the government of Canada to include the provinces in the Canadian delegation prior to launching negotiations over a new generation free trade agreement. The main reason is that the issue of provincial and municipal government contracts figures highest on the European Union’s negotiations agenda. Accordingly, the EU felt that if negotiations were to have a chance of succeeding, they had to include representatives of the provinces, which are not required to carry out an agreement concluded by the federal government respecting their areas of jurisdiction.
Thus, for the first time in the history of Canadian trade negotiations, the provinces have enjoyed representation. Negotiations between Canada and the European Union were formally divided among 12 tables, with the provinces being represented at seven of them. In addition, during these talks, the provinces’ representatives have informal relations not only with Canadian government negotiators but also with those of the European Union. In negotiations concerning climate change, the United Nations formally recognized the importance of these actors. Accordingly, the United Nations Development Programme states that “[…] most investments to reduce GHG (greenhouse gas) emissions and adapt to climate change – 50 to 80 percent for reductions and up to 100 percent for adaptation – must take place at the sub-national level.” Furthermore, at the 16th session of the Conference of the Parties (COP16) of the United Nations Framework Convention on Climate Change held in Cancun in December 2010, the major role falling to federated states and regional governments was officially recognized under article 7 of the Cancun Agreements. During his speech before the delegates, the Canadian government’s representative, Environment Minister John Baird, explicitly acknowledged the contribution of the Canadian provinces, and of Quebec in particular, to climate change efforts.