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Scholars of economic development in the Global South and of industrial policy in the Global North are increasingly advocating top-down policies by a strong, activist state to promote growth and innovation. Instead, we argue there is much to learn from firm-centered approaches about how the main economic decision-makers, namely, firms, engage with the constraints and opportunities that they face. This is particularly important in the semi-periphery, where public authorities do not always have the capacity, resources, and political support required to play the activist developmental role suggested in the literature. This introduction to the special issue develops the concept of the semi-periphery, showing that it can foster knowledge exchange across the North–South divide and promote innovation in analyses of the dynamics of economic development. It also presents the multilevel perspective through which the special issue accounts for cases where firms were able to overcome semi-peripheral constraints. We argue that carving out economic opportunities in the semi-periphery often requires the activation of the initiative of local firms, which form alliances with other actors from the private, public, and non-profit sectors. Rather than producing economic innovation directly, macro-institutions facilitate those efforts by providing a governance architecture that makes it easier for firms to form alliances and innovate.
Scholars of economic development in the Global South and of industrial policy in the Global North are increasingly advocating top-down policies by a strong, activist state to promote growth and innovation. Instead, we argue there is much to learn from firm-centered approaches about how the main economic decision-makers, namely, firms, engage with the constraints and opportunities that they face. This is particularly important in the semi-periphery, where public authorities do not always have the capacity, resources, and political support required to play the activist developmental role suggested in the literature. This introduction to the special issue develops the concept of the semi-periphery, showing that it can foster knowledge exchange across the North–South divide and promote innovation in analyses of the dynamics of economic development. It also presents the multilevel perspective through which the special issue accounts for cases where firms were able to overcome semi-peripheral constraints. We argue that carving out economic opportunities in the semi-periphery often requires the activation of the initiative of local firms, which form alliances with other actors from the private, public, and non-profit sectors. Rather than producing economic innovation directly, macro-institutions facilitate those efforts by providing a governance architecture that makes it easier for firms to form alliances and innovate.
This paper explores the long‐term impact of China's Great Leap Forward (GLF) on current differences in cooperative behaviour across Chinese regions and the underlying trust channel of causality. Combining the current firm‐level survey with grain yield over‐reporting during the GLF era, we find that past government dishonesty regarding over‐reporting in the GLF period has long‐term negative consequences on people's behaviours. The firms in the prefecture with a higher degree of yield over‐reporting are less likely to engage in R&D collaborations today. Further tests reveal the possible trust channel through which past government dishonesty impedes current cooperative behaviour. We extend the analyses to social norms of trust and show that GLF over‐reporting has shifted an individual's internal norms towards a present‐day mistrust culture, which contributes to explain the negative effect of GLF over‐reporting on cooperative behaviour. Our findings suggest that dishonest behaviours by local governments in the past can lead to lasting adverse effects on an individual's behaviour in the form of mistrust and subsequent lower frequencies of cooperative behaviour, providing new insights on the origins of cultural differences and human behaviours by investigating the role of governments in shaping social and economic interactions.
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