Governance

FSI's research on the origins, character and consequences of government institutions spans continents and academic disciplines. The institute’s senior fellows and their colleagues across Stanford examine the principles of public administration and implementation. Their work focuses on how maternal health care is delivered in rural China, how public action can create wealth and eliminate poverty, and why U.S. immigration reform keeps stalling. 

FSI’s work includes comparative studies of how institutions help resolve policy and societal issues. Scholars aim to clearly define and make sense of the rule of law, examining how it is invoked and applied around the world. 

FSI researchers also investigate government services – trying to understand and measure how they work, whom they serve and how good they are. They assess energy services aimed at helping the poorest people around the world and explore public opinion on torture policies. The Children in Crisis project addresses how child health interventions interact with political reform. Specific research on governance, organizations and security capitalizes on FSI's longstanding interests and looks at how governance and organizational issues affect a nation’s ability to address security and international cooperation.

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The digital Information Technology (IT) revolution currently underway is profoundly reshaping economic activity, influencing politics, and transforming societies around the world. It is also forcing a reconceptualization of the global and local; many of the technologies, platforms, and fundamental disruptions are global in nature, but national or local contexts critically influence the uses and effects of IT.

Digital media— broadly conceived as digital platforms for information creation, transmission, and consumption—is a core driver of the IT revolution. Information is the very essence of civilization itself, and the advent of digital media fundamentally transforms our relationship to information. We have already seen: 1)  the Internet maturing as a platform for posting, disseminating, and consuming information, such as online news startups, video such as Youtube, microblogs to evade censorship, and a global marketplace for selling software, advertising and even personal information; 2) the diffusion of mobile communications, making information available across  geographic and socio-economic boundaries, and 3) the widespread adoption of social networking services that represent exploration into the next stage of relationships between people, groups, firms, and other entities.

Digital media is also at the crux of the “global meets local” dynamic, since digital media is by nature global, but differences in economic, political, and social conditions across countries lead to wide variation in its impact. For example, digital media is argued to have been a catalyst in the Arab Spring demonstrations that led to regime shifts in Tunesia, Egypt, and then Syria, but digital media in itself may not lead directly to a regime shift in China— due to government success in sophisticated censorship and physical network design.

The Asia-Pacific provides a fascinating array of countries for examination of the political, economic, and socio-cultural effects of digital media on the modern world. Economies range from developing to advanced. Governments include varied democracies as well as one party regimes. The press enjoys relative freedom in some countries, undergoes limited constraints in others, and is tightly controlled in a few. Populations range from dense to sparse, and from diverse to relatively homogenous.

The panels were divided to discuss four major themes:

Digital Media versus Traditional Media
Around the world, digital media is disrupting traditional media such as newspapers and television. Traditional business models are undermined, new entrants proliferate, and experimentation abounds with no end-game in sight. Questions for countries with well-established traditional media include: what are the patterns for the emergence of new players? To what degree do they threaten the traditional? In countries with less diffused traditional media, what are the opportunities enjoyed by digital media? 

Beyond business models, the social and political functions of digital media may differ from those of traditional media—particularly where traditional media is subject to close governmental control. Who are the new entrants, and what new functions do they provide?  Have traditional media failed as sources of information? What shifts have occurred in how people get information, and how does this differ across countries?

Digital Media and Political Change in Asia
Digital media opens up vast new information flows that can influence political change. From the perspective of grass-roots movements and civil society, digital media provides new tools to congregate, coordinate, and demonstrate. Governments that strongly control civil society, such as China and Vietnam, were alert to the role digital media played in the Arab Spring. What is the potential for digital media in civil society and democratization? In democratic countries such as Japan, South Korea, or India, how is digital media transforming civil society? For example, Japan’s peaceful anti-nuclear demonstrations, coordinated through digital media, displayed an entirely new pattern.

From the perspective of governments, digital media presents not only challenges, but new opportunities to monitor, gather information, and respond to the public. In strong state countries, control of information flows to the people, and gathering of information about people are the cornerstones of state control. How are these states adapting their attempts at controlling media in the face of pervasive digital media? In democratic systems, deciding what information to channel to which voters at what point in election cycles is a critical part of any electoral strategy. How are governments and parties using digital media to reach their constituencies, and what is their effectiveness?

Social Change and Economic Transformation
As a core part of the IT revolution, digital media has opened up new domains of innovation that transforms industries and economies. For advanced countries, it raises serious questions about how best to profit from digital platforms whose underlying technology is increasingly controlled by American multinational firms. For developing countries, the question is how to best take advantage of the world-class computing resources, global markets, and extensive reach enabled by the technological platforms underlying digital media. Instruments such as smartphones and the digital content conveyed on those devices are altering interpersonal relations and even the struggle against poverty in societies such as India.

The advent of social network services is also altering how we conceive of social connections. How do these networks affect groups such as the Korean or Filipino diasporas, and what are the implications for identity, “imagined communities,” and group identification. In what ways is the cohesiveness of groups enhanced by connections such as Facebook or Twitter, and in what ways are groups fragmented along interest cleavages, with people exposed to only ideas and groups of their choice. How does digital media impact social change and how does that impact lead to economic transformation in both developed and developing countries?

Digital Media and International Relations
The growth of digital media produces a powerful and sometimes troubling impact on international relations in the Asia-Pacific region. It can provide greater cultural understanding and regional integration but also aggravate tensions.  Cultural phenomenon such as the wildly popular Korean pop star Psy (of “Gangnam Style” fame) arise from the availability of digital media allowing a video to ‘go viral’ on a global scale in weeks. Conversely, tensions over territorial and historical issues in Northeast and Southeast Asia gain credence and momentum from discussion on digital media platforms, often pushing governments to act in ways detrimental to peace and stability. How does digital media influence international relations in the region? Is it a force for positive change or a source of instability? Finally, the rules governing critical parts of the physical infrastructure upon which digital media depend, such as governance of the Internet are increasingly contested in the international domain.

The fifth Stanford Kyoto Trans-Asian Dialogue focused on these issues surrounding the impact of digital media. The Dialogue brought together scholars, policy experts, and practitioners from the media, from Stanford University and from throughout Asia. Selected participants will start each session of the Dialogue with stimulating, brief presentations. Participants from around the region engaged in off-the-record discussion and exchange of views. The final report from the Dialogue will be published on this page as soon as it has been completed.

The Walter H. Shorenstein Asia-Pacific Research Center (Shorenstein APARC) established the Stanford Kyoto Trans-Asian Dialogue in 2009 to facilitate conversation about current Asia-Pacific issues with far-reaching global implications. Scholars from Stanford University and various Asian countries start each session of the two-day event with stimulating, brief presentations, which are followed by engaging, off-the-record discussion. Each Dialogue closes with a public symposium and reception, and a final report is published on the Shorenstein APARC website.

Previous Dialogues have brought together a diverse range of experts and opinion leaders from Japan, South Korea, China, Vietnam, Thailand, Indonesia, Singapore, India, Australia, and the United States. Participants have explored issues such as the global environmental and economic impacts of energy usage in Asia and the United States; the question of building an East Asian regional organization; and addressing the dramatic demographic shift that is taking place in Asia.

The annual Stanford Kyoto Trans-Asian Dialogue is made possible through the generosity of the City of Kyoto, the Freeman Spogli Institute for International Studies at Stanford University, and Yumi and Yasunori Kaneko.

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Shorenstein Postdoctoral Fellow in Contemporary Asia
FURGHOTT,_Michael_3x4.jpg PhD

Michael Furchtgott is an economist interested in corporate finance and governance. His current research investigates Japanese corporate restructurings and the behavior of firms and lenders when financial distress arises.

Furchtgott has completed his PhD in economics at the University of California, San Diego, where his research on corporate financial restatements has demonstrated that firms frequently circumvent laws designed to protect investors.

He holds a BA in economics and mathematics from Columbia University.

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A tremendous amount of radioactive products were discharged as a result of the accident at the Fukushima nuclear power plant in March 2011, which resulted in radioactive contamination of the plant and surrounding areas. While geographical distribution of radioactive iodine, tellurium, and cesium in the surface soils was smoothly (but not always systematically) widespread all over the region, health risk information by the government, media, and other organizations is most likely to be given in terms of administrative boundaries (cf. prefectures, municipalities, etc.) and/or distance from the radiation source.

This paper estimates the effect of such health risk information rather than the actual health risks of radiation on land and other prices in different locations. We find that the prefecture and municipality border effects – but not the distance effect from the nuclear power plant – are significantly related to a reduction in land and other prices after the accident. This shows that people responded to health risk information based on administrative boundaries rather than the actual health risk of radiation after the disaster. Although health risk information based on prefecture and municipality boundaries has an obvious advantage of distilling large and complex risk information into a simple one, the government, media, and other organizations need to recognize and carefully examine the potential of misclassifying non-contaminated areas into contaminated prefectures. Doing so will avoid unintentional consequences to the region’s economy.

Hiroaki Matsuura is currently Departmental Lecturer in the Economy of Japan in the School of Interdisciplinary Area Studies, University of Oxford and a Junior Research Fellow of St. Antony’s College. His main interests are health economics and demography, with a special interest in the relation between laws and population health. Hiroaki received his B.A. in Economics from Keio University, M.A. in Social Science from the University of Chicago, M.S. in Project Management from Northwestern University’s McCormick School of Engineering and Applied Science, and Sc.D. in Global Health and Population (Economics track) from Harvard University’s School of Public Health. In the past, he was affiliated with Institute of Quantitative Social Sciences, Human Rights in Development, and Takemi Program in International Health at Harvard University. He also worked as a research assistant at the National Bureau of Economic Research. His doctoral dissertation research explores a right to health or to health care in national constitutions of 157 countries and state constitutions of the 50 U.S. states and estimates the impact of introducing (or removing) a right to health or to health care into national and state constitutions on health system and population health outcomes. His most recent article, “The Right to Health in Japan: Challenges of a Super Aging Society and Implication from Its 2011 Public Health Emergency” (with Eriko Sase) will be appeared on “Advancing the Human Right to Health”, edited by José M. Zuniga, Stephen P. Marks, and Lawrence O. Gostin, Oxford University Press, 2013. 

Daniel and Nancy Okimoto Conference Room

Hiroaki Matsuura Departmental Lecturer in the Economy of Japan in the School of Interdisciplinary Area Studies Speaker University of Oxford
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How are the Japanese people reacting to the news of the continuing contamination leak and what does it mean for Japan's energy policy? In an interview with PBS NewsHour on August 8, Kenji E. Kushida speaks about what the government may do to stop the flow.
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Unit 4 of TEPCO's Fukushima Daiichi Nuclear Power Station (02813334) | Flickr user IAEA Imagebank
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Phillip Lipscy examines Japan's military decline and its implications for regional security in a coauthored article in Foreign Policy.
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The Democratic Party of Japan (DPJ) came to power in 2009 with a commanding majority, ending fifty years of almost uninterrupted Liberal Democratic Party (LDP) rule. Then, in 2012, just over three years later, the DPJ lost power in an equally stunning landslide loss to the LDP. This volume examines the DPJ’s remarkable ascendance, its policies once in power, and its dramatic fall.

What explains the DPJ’s rapid rise to power? Why was policy change under the DPJ limited, despite high expectations and promises of bold reform? Why has the party been paralyzed by internecine conflict?

Chapters in the volume cover: DPJ candidate recruitment; the influence of media coverage; nationalization of elections; electoral system constraints on policy change; the role of third parties; municipal mergers; the role of women; transportation policy; fiscal decentralization; information technology; response to the Fukushima nuclear disaster; security strategy; and foreign policy. Japan under the DPJ makes important contributions to the study of Japanese politics, while drawing upon and advancing scholarship on a wider range of issues of interest to political scientists.

Examination copies: Desk, examination, or review copies can be requested through Stanford University Press.

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The Politics of Transition and Governance

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Kenji E. Kushida
Phillip Lipscy
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Shorenstein APARC
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In our current era, the advent of digital technologies and accelerating globalization is driving ever-faster commoditization of firms and products.  With rapidly improving Information and Communications Technology (ICT) tools, manufacturing is decomposed with finer granularity, and corporate functions can be outsourced and offshored more than ever before.  Services can be unbundled into activities that can be taken apart, reconfigured, and transformed with the application of algorithms.  Overall, firms are experiencing accelerating shifts in the sweet-spot for markets and business models in their search for sustainable advantage.

As firms struggle to adjust in this global, digital world, governments are also under pressure to examine their options to retain value in their national contexts; wealthy nations face the challenge of how to remain wealthy.

Japan is no exception, and from this vantage it is worth reconsidering the potential role that industrial policy can play in its growth strategy.  We will proceed in three sections, each of which builds from our previous research (indicated below the title), towards a set of recommendations for thinking about industrial policy in this digital, global era.  Each point contributes something new to Japan’s discourse about a new growth strategy.

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Japan Spotlight
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Kenji E. Kushida
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A fundamental transformation of services is underway, driven by developments in information and communications technology (ICT) tools, the uses to which they are being put, and the networks on which they run. Services were once considered a sinkhole of the economy, immune to significant technological or organizational productivity increases. Now, they are widely recognized as a source of productivity growth and dynamism in the economy that is changing the structure of employment, the division of labor, and the character of work and its location. Yet, the actual character of this transformation is often obscured by the increase in jobs labeled as services and by a focus on the digital technologies that, certainly, are facilitating this transformation. This transformation, central to the growth of productivity and competition in the economy, poses basic policy and business choices.

The core of our story of the services transformation is not about the growth in quantity or value of the activities labeled services, the conventional emphasis of much of the writing about services. Nor is it about the revolution in digital technology. Rather, it is about how the application of rule-based information technology tools to service activities transforms the services component of the economy, altering how activities are conducted and value is created.

There are significant implications for how firms compete. Services are increasingly the way that firms pursue value-added activities to avoid ever-faster commoditization of products, that is to avoid competition based solely on price when market offerings are relatively similar. However, the unbundling of services activities themselves accelerates this commodification, since competitors have the same efficiency-enhancing business process and infrastructure services available to them. Firms increasingly become bundles of services purchased on markets, and at the same time some of those in-house business functions that are maintained are then offered as services. A consequence is that the distinction between products and services blurs, as manufactured products are increasingly embedded within and recast as services offerings. Clearly, traditional sectoral boundaries break down, as information and services offerings bring previously unrelated firms into direct competition.

Likewise, the consequences for business organization, production, and work are profound, just as work was transformed by the evolution of manufacturing. The automation of basic activities both frees, but also requires, professionals to perform more advanced tasks. And the analytical tasks of managing information flows generated by ICT-enabled services often require a different set of skills than providing the service itself.

Capturing the possibilities from the services transformation presents new policy challenges for governments and regions. Services are deeply rooted in social rules, conventions, and regulations. Consequently, capturing the value possibilities inherently means recasting the rules, regulations, and conventions in which the services are embedded.

The development and deployment of ICT-enabled services should be considered a form of production. As ICT has become integral to the creation and delivery of services, ICT-enabled services have taken on the characteristics of production normally assigned solely to manufacturing. ICT systems that deliver the services have to be designed, developed, built, and implemented and they are very much open to innovation and productivity increases. Investments are often industrial in scale.

ICT-enabled services are the latest phase in a long history of production innovation. The history of manufacturing production progressed along distinct epochs, each with distinct manufacturing processes, management structures, labor practices, productivity, and outputs. The development of ICT tools and their application to services activities has driven a shift to the latest epoch.

The advent of Cloud Computing, emerging as the next dominant computing platform, accelerates the transformation of services. Cloud Computing, a distinct set of business models and performance attributes (not simply a code-word for everything online), enables new business models, transforms existing strategies, lowers the bar for new entrants, and raises a myriad of policy issues.

From a policy standpoint, the question is how to conceive, design, develop and build and deploy the new system. The “good” jobs, high value added functions, are in the innovative development and deployment of these systems. Policy makers need to employ strategies that will help communities and firms to develop the competencies required for this new form of production.

The continuing debate in political, economic and public policy circles about the relative value of manufacturing jobs and service-sector jobs is increasingly irrelevant to policy debates in the real economy. Just as it is inaccurate to assume that manufacturing jobs are secure and well paid, it is also inaccurate to consider service jobs to be dead-end, low-wage, unskilled positions. 

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Oxford University Press in "The Third Globalization: Can Wealthy Nations Stay Rich in the Twenty-First Century?"
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Kenji E. Kushida
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