Global Public Goods: A Survey

This survey investigates the increasing importance of global public goods (GPGs) in today’s interdependent world, driven by ever-growing, cross-border externalities and public good spillovers. Novel technologies, enhanced globalization, and population increases are among the main drivers of the rise of GPGs. Key GPGs include curbing climate change, instituting universal regulatory practices, eradicating infectious diseases, preserving world peace, discovering scientific breakthroughs, and limiting financial crises. The survey presents a compact theoretical foundation for GPGs, grounded in the provision of public goods. Because countries may be contributors or noncontributors to a particular GPG, coalition formation and behavior play a role, as do strategic interactions between a contributor coalition and other countries. In the survey, recurrent themes include strategic considerations, alternative institutional arrangements, GPGs’ defining properties, new actors’ roles, and collective action concerns. The four properties of GPGs—benefit non-rivalry, benefit non-excludability, aggregator technology, and spillover range—influence the GPGs’ supply prognoses and the need for and form of provision intervention, which may affect the requisite institutional changes. Three representative case studies illustrate how theoretical insights inform policy and empirical tests. Regional public goods are shown to involve a question of subsidiarity and different actors compared to GPGs. (JEL C71, C72, D62, D70, H41, Q54)

Drivers of Indian Naval Expansion

Traditionally the neglected ‘Cinderella’ service of the Indian armed forces, the Indian Navy is in the midst of a modernization programme that has attracted international concern from commentators who worry that this might pose a risk to stability in the Indian Ocean or presage a naval arms race in Asia. This chapter attempts to understand what is driving this uncharacteristic focus on the Navy, concentrating on developments in the 20-year period since the end of the Cold War (1991–2011). The analysis proceeds in two parts. The first section examines several different measures, including number of ships, aggregate tonnage, number of missile cells and budgetary allocation to understand the trajectory of the Indian Navy over the past 20 years. Section two examines three oft-cited justifications for naval expansion – defence against hostile maritime powers, the cultivation of power projection capability to further India’s political interests, and the protection of trade – in relation to the fleet’s actual platform acquisitions to determine their relative importance in driving naval development. The available data suggests that the primary mission driving naval modernization is sea-lane security, with the development of ‘softer’ aspects of power projection capability receiving some support, while the need to deter hostile maritime powers does little to explain India’s recent naval modernization. This focus on enhancing India’s ability to provide regional ‘public goods,’ such as sea-lane security and humanitarian response, strongly suggests that this growing naval strength can emerge as a net positive for the region.

The Influence of Public Goods on the Development of China’s Regional Economy – A Spatial Econometric Approach

China’s economy has been soaring in the recent decades. Nevertheless, it is characterized by problems of imbalance of economic development, which could hinder the sustainable development of the economy. This paper selects data of various kinds of public goods provision and regional economic development status in China from 2007 to 2014, and investigates the influence of public goods on the development of China’s regional economy from using a spatial econometric approach. Empirical findings show that there is a significant spatial correlation within the data of public goods investment during 2007 and 2014, and that the investment on public goods has positive influence on development of regional economy. The finding also shows that there exist spatial spillover effects, which means that the investment in regional public goods can boost the economic growth of surrounding regions.