Mark Thatcher

Political economy debates have focused on the internationalisation of private capital, but foreign states increasingly enter domestic markets as financial investors. How do policy makers in recipient countries react? Do they treat purchases as a threat and impose restrictions or see them as beneficial and welcome them? What are the wider implications for debates about state capacities to govern domestic economies in the face of internationalisation of financial markets? In response, Foreign States in Domestic Markets have developed the concept of 'internationalised statism', where governments welcome the use of foreign state investments to govern their domestic economies. These foreign state investments are applied to the most prominent overseas state investors, Sovereign Wealth Funds (SWFs). Many SWFs are from Asia and the Middle East and their number and size have greatly expanded, reaching $9 trillion by 2020. This book examines policies towards non-Western SWFs buying company shares in four countries: the US, UK, France, and Germany. Although the US has imposed significant legal restrictions, the others have pursued internationalised statism in ways that are surprising given both popular and political economy classifications. This book argues that the policy patterns found are related to domestic politics, notably the preferences and capacities of the political executive and legislature, rather than solely economic needs or national security risks. The phenomenon of internationalised statism underlines that overseas state investment provides policy makers in recipient states with new allies and resources. The study of SWFs shows that internationalisation and liberalisation of financial markets offer national policy makers opportunities to govern their domestic economies.

This book examines when, how, and why internationalisation affects national economic institutions. It confronts questions at the heart of debates in political economy and comparative politics: What does internationalisation of markets mean? Who are its carriers in domestic arenas? Through which mechanisms does it affect decisions about national institutional reform? What are the patterns of institutional outcomes in the face of internationalisation? To respond to its questions, the book looks at developments in five strategic sectors: securities trading, telecommunications, electricity, airlines, and postal services. It compares four countries, each representing a different 'variety of capitalism', namely Britain, France, Germany, and Italy, over the period between 1965 and 2005. Thus it combines cross-national, historical, and cross-sectoral comparisons. The author distinguishes technological and economic forms of internationalisation from policy forms, namely regulatory change in powerful overseas nations and by the EU. He shows that, contrary to expectations, the first made little impact, whereas regulatory reforms by the US, Britain, and the EU, undermined long-standing national institutions. They did so by aiding governments to build and lead reform coalitions, through increasing fears of regulatory competition, offering occasions for reconsideration of existing institutions and providing legitimation for new ones. Whilst the impacts of policy forms of internationalisation varied across nations, giving rise to diverse reform paths, the overall institutional outcomes were that all four countries adopted increasingly similar reforms of economic institutions. This book rejects the view that technological and economic forms of internationalisation drive institutional change in and of themselves. Instead it shows that policy forms of internationalisation are influential because they become part of domestic decision making and thereby spur reform, even of deeply-entrenched national institutions.

This book examines when, how and why internationalisation affects national economic institutions. It confronts questions at the heart of debates in political economy and comparative politics: What does internationalisation of markets mean? Who are its carriers in domestic arenas? Through which mechanisms does it affect decisions about national institutional reform? What are institutional outcomes in the face of internationalisation? The book responds to its questions by looking at key economic institutions in five strategic sectors: securities trading, telecommunications, electricity, airlines and postal services. It compares across four countries that represent different 'varieties of capitalism', namely Britain, France, Germany and Italy, over the period between 1965 and 2005. Thus it combines cross-national, historical and cross-sectoral comparisons. The author distinguishes technological and economic forms of internationalisation from policy forms, notably decisions in powerful overseas nations and supranational regulation. He argues that, contrary to expectations, the first was met with institutional inertia. In contrast, policy forms of internationalisation, namely reforms in the US and European Union regulation, played significant roles in undermining long-standing national institutions. The book explores the mechanisms whereby policy forms of internationalisation were influential by looking at the strategies, coalitions and resources of key actors in national arenas. It also shows that institutional outcomes were surprising: all four countries, albeit through different routes, adopted increasingly similar reforms of economic institutions- privatisation, the ending of monopolies and delegation to independent regulatory agencies. The book rejects the view that technological and economic forms of internationalisation drive institutional change. It suggests that policy forms of internationalisation are more important because they become part of domestic decision making and aid the reform of well-established national institutions.

Public utilities constitute a large section of Europe' economy, and they have historically been at the centre of national states and their industrial strategies. However, the recent creation of the single market and the liberalisation of European utility sectors have resulted in an expansion of EU/EC economic regulation. This book examines the interaction among the economic and political actors and raises questions regarding the format regulation. The chapters discuss the history of utilities reform, assess the nature of the changes, and address the issues of institutional modification. Four themes emerge from the collection -- the characteristics of Europe-wide reform, the nature of national variance, cross-sectional variations, and the institutional arrangements that can emerge to accommodate the regulatory regime.

This book confronts some of the most important questions related to liberalization, regulation, and the role of the nation state in an increasingly international economy. In the face of powerful transitional pressures for change, to what extent are states able to maintain stable institutional frameworks? Do different domestic structures generate dissimilar patterns of policy-making and economic performance? How important are past institutional choices to subsequent reform? The author addresses these questions through a study of the transformations of a strategic economic sector, telecommunications, in Britain and France over the past three decades. It analyses the theoretical strengths and weaknesses of various models of public policy formation and, the role and reform of national institutions and the continuing role of the nation state.