Introduction

Social marketing is becoming increasingly relevant to the developing world. The success of social programmes has significantly contributed to the process of development in the countries of the Third World and the failure of such programmes has resulted in tardy development. Their success has been attributed to the adoption of marketing approach to the social/development programmes. In promoting any social idea or issue, it is not enough to prepare the communication programme. Everything associated with the delivery system has to be taken care of. Let us take the example of the immunization programme. One cannot expect the success to come only through catchy advertising campaigns. The network of primary health centres, with proper staff, adequate stock of vaccines kept under prescribed conditions, quality of vaccines and the price one has to pay for immunization are significantly important. It is the marketing approach which helps in gaining an insight into these finer aspects.

Social marketing, as the concept evolved, acquired two different dimensions (Luck 1974). One dimension of it related to social responsibilities of marketers, mainly in response to consumer advocacy movement and also the pressures of government regulations. In this case, the focus is on economic benefits to business and social benefits to society that emerge from the adoption of socially responsible business policies by business organizations (Lazer and Kelley 1973).

One of the first signs that greets arriving passengers at Kathmandu's Tribhuvan Airport instructs them to ‘first clear immigration before you pass out’. On a recent trip to Nepal I fully appreciated the airport authority's concern. Thanks to the bumpy flight over the Himalayas, one does feel somewhat light in the head as one conducts oneself through the rites of entering the country.

I took to Nepal quickly. It is beautiful; the people lack intrigue; the artwork on building façades and thangkas is exquisite. Besides, there is much to occupy an economist's attention—the haggling in the bazaars, the attitude to money and work among auto-drivers and roadside entrepreneurs, the stratagems and irrationalities in gambling parlours, and, most remarkably, the economy's ability to effortlessly switch between two currencies. Buy a yak-bone sculpture, have a meal at Rum Doodles (highly recommended), or take a taxi. Everywhere you have the choice of paying in Nepalese or Indian rupees.

This is a textbook case of ‘currency substitution’ or ‘dollarization’, where one economy accepts another's currency for its day-to-day transactions. This need have nothing to do with the dollar—though it often does. For instance, Panama has no national currency of significance. It runs on American money. It is true that it saves on running a central monetary authority, but the policy makes Panama vulnerable to the actions of the American Fed.

Introduction

When promoting his newly invented roller spinning machine in Britain's textile industry, John Wyatt wrote in 1741: ‘Adopting the machine, a Clothier formerly employing a hundred spinners might turn off thirty of the best of them but employ an additional ten infirm people or children …’ The attorney general was won over and, in granting a patent to the invention, noted with awe how ‘even Children of five or six Years of age’ could operate the machine.

Commending an invention for its ability to facilitate child labour or upholding children's work as an instrument to out-compete other nations in global trade are now matters of distant history. In fact, quite soon after Mr Wyatt's invention began replacing adults with children, Britain started to discuss policy for curbing child labour, which culminated in Robert Peel's Factories Act, 1802. By the end of the nineteenth century child labour was on the decline in most industrialized nations. However, the global child labour problem did not come to an end. As data began to emerge from developing countries, it was evident that child labour, especially some of the worst forms found mainly in factories and the manufacturing sector, had simply shifted to the Third World.

Over the last ten years, thanks to serious effort at collecting data, we have come to acquire a fairly good picture of the global map of child labour.

Introduction

This paper begins with two main assumptions. The first assumption is that the United Nations Environmental Programme (UNEP) is the key institution of global environmental governance. Developing countries and their individual concerns play a crucial role within the discussion surrounding the reform of the global environmental governance system. UNEP's current ability to perform its functions properly needs to be developed. The second assumption is that developing countries have to promote the process of development as well as environmental protection. Therefore, they need to participate better in global environmental governance.

Following from the main assumptions, several guiding questions are of crucial importance. First, is institutional reform of UNEP necessary and what are the main challenges? Second, what is the impact of UNEP institutional reform on developing countries? What are developing countries' political positions on UNEP and its possible reform? Third, what will UNEP look like in the future and how can developing countries better utilize and strengthen the institutional frameworks that currently exist?

To answer the research questions, a multiple methodology design was adopted. The first method involved documentary research such as: collecting, analyzing, and summarizing related documents and achievements. Three sets of interviews were conducted with scholars and organizations relating to UNEP reform including IISD (International Institute for Sustainable Development), IGSD (Institute for Governance & Sustainable Development), Department of Geography and Environment at King's College and others.

Traditional economics downplayed the role of culture and social norms in the progress of nations, and was dismissive of anybody who evinced an interest in these topics. A joke that did the rounds among mainstream economists was the one about an expert on culture and economics who said, ‘There are three kinds of economists, those who can do mathematics and those who cannot.’

The same is true in other disciplines. The anthropologist Clifford Geertz observed that ‘The term “culture” has by now acquired a certain aura of ill-repute in social anthropological circles.’

Fortunately, this is changing. A whole lot of serious economists and anthropologists are now interested in the role of culture in economic and social life. This is partly because of the rise in the study of evolutionary game theory, which has given us a handle for modelling and understanding culture; and partly for the practical reason that with globalization, different cultures—once far apart—are today rubbing shoulders. At times this gives rise to new bursts of creativity, at times to friction and occasionally to amusement.

Travelling by train and bus in the West and in India can give one fascinating glimpses of cultural differences. In the West, it is impolite to ask the stranger who happens to be sitting next to you personal questions. So you make inane conversation about the weather. In India it is in fact impolite not to ask personal questions: it shows you're being standoffish.

Abstract

This chapter examines the contributions that the original Basel Accord took and that Basel II might make toward changing the banking regulation framework in Brazil. It will be argued that risk weighted capital requirements imposed by the Original Accord, which took effect in 1994, meant not just an important change, but almost the creation of a bank regulation framework in Brazil. It will be argued that the adoption of Basel II may increase not only the concentration level, which is already very high, but also the participation of the foreign capital in Brazilian banking system.

Introduction

Financial markets are submitted to more well-developed regulatory and supervisory mechanisms than those found in other sectors of the economy, a fact that is explainable due to the features that are inherent to the nature of the transactions conducted within these markets. Among such features, one may point out those which would explain the sensitivity of financial institutions, and specially banks, to crises, and the possibility that contagious movements will irradiate from such institutions, causing a systemic risk. Bank institutions, jointly with the Monetary Authority, are members of the monetary system, they receive and create cash deposits, fully liquid instruments. They operate by leverage, i.e., their assets and liabilities are higher than their capital and, generally speaking, they act as term changers: the terms of the liability transactions are shorter than the terms of the asset transactions.

Theory does not happen in a vacuum. Economists will think of John Maynard Keynes and the Great Depression. Keynes observed that markets do not always clear as economics had long taught. For example, one third of US labor force was effectively without work in the 1930s. Rather than prices, quantities adjusted and the economy settled into an unemployment equilibrium. By incorporating that observation into theory, macroeconomics emerged. Today, more reason exists than ever to believe that theory cannot happen in a vacuum. According to Stern, climate fluctuations may wreak havoc on the scale of the Great Depression and the wars of the first half of the twentieth century combined. Will a new macro-macroeconomics emerge? The crux of my argument is that it has already emerged. By the mid-1970s, a new macromacroeconomics could be gleaned in the economics of Boulding, Georegescu-Roegen, Schumacher, and Daly, and the science of Carson, Ehrlich, Hardin, and Prigogine. Ten years is a reasonable lag for putting into practice the synthesis. Had the political establishment acted by the mid-1980s, Stern's example of “climate change” as “market failure… on the greatest scale the world has seen” would have been largely mitigated or even averted.

Incorporation of the second law of thermodynamics into economics is the necessary condition to address climate fluctuations but it is not sufficient. One must also understand how institutions work and collective decisions are taken. In the language of thermodynamics, institutions define the boundary conditions while the decisions taken become points of bifurcation in pathways of success or failure.

The country of Nelson Mandela, of Nadine Gordimer, of Steve Biko, of Desmond Tutu, and also of Gandhi. It was impossible not to feel excited as the aeroplane did a broad sweeping turn and lowered itself gently on to the tarmac. The airport at Johannesburg, or Joburg—as the locals call it, presumably to save breath—could have been anywhere in Europe. Men and women of European descent and clothing hurry along to catch flights or taxis, the boutiques overflow with expensive fashion products, and the aroma of good coffee wafts out of stylish cafes.

Upon arrival, another guest and I are driven to Glenburn Lodge, and the address sounds pleasingly exotic to my ears—Kromdraai Road, Muldersdrift. The drive takes nearly an hour. The roads, lined with the most magnificent jacaranda trees in bloom, are wide and smooth. One sees very few people on the streets and the houses, with red begonia, are well spaced with plenty of land surrounding each cluster. It is evident that, with 35 people per km (India has 350), one shortage that South Africa does not have to contend with is land.

Glenburn Lodge is far removed from the bustle of Joburg. Its lodgings and conference rooms are interspersed with brooks and wilderness; and from one's window on a quiet afternoon one can see springboks grazing, and, on lucky days giraffes silhouetted against a clear blue sky.

The introduction to this volume was first written in August 2008 with this opening paragraph: ‘The global economy is reeling under one of the severest crises since the Great Depression of the 1930s, with record high oil prices, the global food crisis and a financial crisis, reverberating across the globe. As the US economy slides deeper towards a full-fledged recession, precipitated by the sub-prime mortgage crisis, the ability of financial markets to play havoc with the “real” economy could not have been more apparent. While some commentators, especially those associated with the mainstream media, are still debating the extent of the downturn in the US economy and defending the innovative aspects of financial markets, inside the US, the grim reality seems to have hit home. The implications of the collapse of the housing boom, the associated collapse of major banks with high exposure in the housing markets, coupled with the financial burden of the Iraq war has meant rising unemployment, cut back in consumer spending and overall economic downturn, with no signs of reversal in sight. These events bring to the fore the myriad connections between the “real” and the “financial” – and point to the urgency of understanding these connections, especially in the present era of globalization and financial deregulation.’

Exactly a year later, with a series of bank collapses, as the developed economies grapple with stimulus/rescue packages and bail-out measures to counter the cascading impact of lay-offs and closures, the debate is not whether this is a recession but on how bad it will get before it starts to get better.

There is an old story of Stalin visiting a school in Moscow and asking the clever kid, Boris: ‘Who killed Julius Caesar?’ Boris burst out crying, ‘Not me sir.’ A furious Stalin met the teacher and asked him to explain. The teacher, trembling, said, ‘Sir, I have looked into the matter and can confirm that, incredible though it may seem, Boris did not kill Julius Caesar.’ An exasperated Stalin called on the headmaster. But the headmaster's response was the same. Boris had not done it. And this continued—the same question being asked of different authorities, and the same answer. Finally, Stalin sent for the KGB chief and asked him to look into the matter. The following day, the chief returned to say, ‘Sir, the KGB has solved the problem. The boy has confessed.’

Has India's poverty, as measured by the percentage of people living below the poverty line, gone down during the 1990s? The same answer, no, for many years and then a sudden dramatic change, caused by a different method of calculation by India's National Sample Survey (NSS), seemed to have a strange parallel with the Stalin story.

Few economic debates have been as charged and murky as the one that tries to answer the question concerning India's poverty. For a lot of people (foolishly, in my opinion) the answer to this question is tantamount to an evaluation of the success or failure of the economic reforms that were started in 1991.

A major concern for all Indians today is the repeat appearance of hung parliaments. If after an election no party manages to establish a majority in parliament, the standard recourse has been to call another election. However, with around 600 million voters, elections are expensive, and there is no guarantee that the new parliament will yield a majority. So I suggest a new voting system which, without sacrificing the basic principles of democracy, will almost always guarantee that one party will come out with a majority.

In suggesting this scheme a few criteria are worth bearing in mind. First, the new system must be simple, so that even the illiterate voter can understand it. Second, it must not be so different from the present system that it gets rejected out of hand as too alien to Indian democracy. Indeed, I believe India would be better served by a presidential system, and we could then use the system of run-offs that many countries use to ensure that the elected president has majority support. But this would involve too major a change for it to be immediately implementable. Finally, it must not be too expensive.

What I am about to suggest meets all these criteria and can be adopted in the very next election, which, given the current prognosis, may not be too far away.

I would like to offer some reflections on imagining a violent history of nation-making in India's cinematic ‘present.’ How do structures of feeling, belief and conflict affect graphing and ‘remembering’ history in Indian cinema? What is the status of the legal, civic or violent ‘event’ – such as the Indian partition of 1947 or the communal riots of increasing frequency since the eighties – in films? What is Indian cinema's imaginary relationship with historiography, and what does it mean to represent an ‘event’ within available ‘structures’ of historic narrative in this cinema frequently described as ‘national’? In discussing the ‘vexed problem of the relation between structure and event,’ and in calling ‘‘structure’ – the symbolic relations of cultural order…an historical object,’ Marshall Sahlins invokes the essential structural backdrop of historical ‘events,’ wherein ‘an event is not simply a phenomenal happening… An event becomes such as it is interpreted. Only as it is appropriated in and through the cultural scheme does it acquire an historical significance… The event is a relation between a happening and a structure (or structures)….’

Introduction

Learning processes, leading to growth in the stock of knowledge, are basic in the dynamics of a modern economy. It will be argued in this chapter that almost all learning processes are interactive, influenced, regarding their content, rate and direction, by the institutional set up of the economy.

When the economy is pictured more as a process of communication and cumulative causation than as an equilibrium system, i.e. from an institutional rather than a neoclassical point of view, learning can be conceptualised as the source of technical innovation. Innovation is then, too, regarded as a process rather than as discrete events uniquely localised in space and time. It follows, it will be argued, that innovation is shaped by institutions and institutional change. It will be suggested that this process can be analysed in terms of national systems of innovation, reflecting that nations differ in terms of institutional set-ups. Furthermore, it will be argued that the relations between institutions and innovation can change, sometimes fundamentally, over time.

Institutions have a strong impact on technical change. However, partly as a consequence of the technical change they shape, a tension between technology and institutions and a pressure for institutional change is often provoked. At the same time institutions are normally quite rigid and do not change easily. The capability of national economies to cope with this problem, i.e. to learn about, adapt and change their institutional frameworks – to engage in ‘institutional learning’ – is important for the development of their international competitiveness.

Overview

Definition

UNCTAD (2000) defines Bilateral Investment Treaties (BITs) as agreements between two countries for the reciprocal encouragement, promotion and protection of investments in each others territories by companies based in either country. BITs constitute to date the most important instrument for the international protection of foreign investment.

While the specific elements of the treaties and the manner of their application differs across countries, typically the coverage of BITs extends to scope and definition of investment, its admission and establishment, national treatment, most favoured nation treatment, fair and equitable treatment, compensation in the event of expropriation, war and civil unrest or other damage to the investment, guarantees of free transfers of funds and recuperation of capital gains, and dispute settlement mechanisms both statestate and investor-state.

Objectives

The proponents of BITs have sought to justify them in terms of the overall benefits in attracting Foreign Direct Investment (FDI). Cross border investments are seen as an important source of bridging the savings-investment gap and boosting economic growth in developing countries. They are thought to be important mechanisms for effecting technology transfer, employment generation and relaxing constraints on Balance of Payments. Profit remittances on account of foreign equity are related to the performance of investment projects unlike the inflexible repayment obligations of foreign debt. These supposed benefits from FDI have generated an intense competition amongst developing countries.

This publication on power shifts and global governance challenges is the output of a collaborative effort of scholars and policymakers who are part of a network that is part of a programme called Managing Global Governance (MGG) that started in 2007. At three levels – theoretical frameworks of global governance, country and regional perspectives, case studies of global governance processes or architectures – the contributions to this book seek to explore global governance issues. For example, the book includes contributions that look at the role of civil society in global governance from a theoretical perspective, analyse regional security issues in Latin America, discuss China's engagement in Africa or develop proposals for possible summit and UN reforms.

The contributors to this book come from Brazil, China, India, Mexico, South Africa and Germany. It is probably fair to say that they all share the concern that global governance processes and structures are becoming increasingly important as we all need to protect global public goods or address global challenges such as climate change, international financial market stability, peace and security, while also focussing on jointly formulated development objectives such as the Millennium Development Goals (MDGs). I believe it is also fair to say that all of those who have contributed to this book are of the view that emerging or new powers such as China, India, Brazil, Mexico, South Africa and others should play a more prominent role in global governance processes and institutions.

As soon as our flight from Delhi touches down in Bangkok there is pandemonium. Virtually all the Indian passengers are up, taking down their luggage and jostling to get to the door. In the Olympics, India wins no medals; our economy trails far behind that of most other nations; but when it comes to disembarking from aeroplanes, Indians have no peer. It is a pity that the International Olympic Association does not recognize this as a sport.

From Bangkok a short flight takes me and my family to Ho Chi Minh City (formerly Saigon). It may be a manifestation of my geographic infidelity, but Vietnam seems more fascinating than any other place I have seen.

The basic facts about Vietnam I knew well before my journey—that it has a per capita income of $370 per annum (significantly less than India's 450); that its economy is controlled by a large, Communist government; that it fought a devastating war with the world's most powerful nation from 1964 to 1975; that it won the war but at the terrible cost of 4 million civilian lives (10 per cent of its population).

But what we see refuses to square up with these facts. Nowhere in HCM City does one see the kind of poverty one encounters in Indian cities. There are beggars but they are better dressed and better nourished than their Indian counterparts.

A ‘rational’ person, so went the assumption in economics, could have any aim in life, but, given that aim, he or she invariably chose the option that best furthered that aim. Over the years this assumption became part and parcel of mainstream economics. Predictions concerning economic life were deduced from this assumption and policy design was based on it. Every now and then some critic would remind us that the assumption was not robust. The reminders would be absent-mindedly acknowledged and promptly forgotten.

The last few years have, however, witnessed a dramatic change in this regard. It began with a set of trespassers into economics. Psychologists Daniel Kahneman, Amos Tversky, and others, through a series of laboratory experiments, showed that not only are human beings often irrational (as most of us already knew), but that they are systematically so. This has given rise to one of the most exciting areas of modern economic research, called ‘behavioural economics’. It is widely expected that this area of inquiry will, within the next few years, be recognized with an economics Nobel Prize being awarded to the pioneers of this field.

Suppose you have a ticket for a cricket match and someone comes up to you and asks the minimum price for which you will be willing to give up the ticket. Next, suppose you do not have a ticket for the match and someone comes to you with a ticket and asks for the maximum you will be willing to pay for it.