Globalization, integration, and cross-border relations in the metropolitan area of Detroit (USA) and Windsor (Canada).

AuthorBrunet-Jailly, Emmanuel

Abstract

Focusing on one aspect of international relations, cross-border relations this paper examines the Ontario-Michigan border region at Detroit. It addresses the following question: Is there a history of trade relations that leads to functional interdependencies? Does free trade, particularly since the Free Trade Agreement and the North American Free Trade Agreement, lead, by a process of functional interdependency, to greater cross-border linkages? Moreover, do politics and institutions mediate this process and if so how?

The findings in this paper suggest that since inception the Canadian-American border region at Detroit has developed from functional interdependencies. It is argued, however, that the free trade environment leads local actors to develop resolute economic development strategies. As central and provincial/state levels of government download policy areas, constraints are greater for local level governments. Central states lose influence but rely on competition to limit the policy choices of local government. Co-operative mechanisms, whether formal or informal, tend to give in to market competition, thus limiting the mediation of free trade by politics and institutions.

Introduction

Economic globalisation and continental integration, in Europe and North America, have motivated local/regional elites to become actors in global economic competition. Since the 1970s, analysts noticed the increasing international activity of sub-national level government, which because of continental integration, global economic change, and weaker national state policies, is motivated to gain greater autonomy from national government (Duchacek et al. 1988). The vulnerability of local constituencies to market forces and to public or private international organisations leads them to take several directions in order to be able to exert influence in return. First, local constituencies attempt to become less dependent on state transfers of revenue, having realised that these transfers are not so reliable (Fry 1998, 57). Second, they try to diversify their economic base to protect and expand their tax base. Because they are held accountable in electoral periods for local economic wealth and job creation, local political actors are becoming more active in order to protect their electoral base, gain political prestige and respond to local needs (Keating 1988, 1990, 1993; Batik 1991; Foster 1991). Cities not only pressure the traditional inter-governmental channels of influence on central government policy-making, but, at the same time, they are becoming primary actors in the area of international economy, trade and investment.

Focusing on one aspect of international relations, cross-border relations (Duchacek 1998, 12-13), this paper, which results from a larger comparative research project on cross-border relations in Europe and North America, addresses the following two question: Does free trade lead by a process of functional interdependency, to cross-border linkages? Do politics and institutions--particularly local level institutions--mediate this process and, if so, how?

First, a review of the cross-border literature is presented in this paper. It leads to the identification of four determinants of cross-border linkages: (1) market forces, which may lead to relations of functional co-operation or to competition across border; (2) a supranational organisation that may also foster cross-border co-operation--the European Commission, for instance, is key to the development of cross-border co-operation programs, which have resulted in hundreds of cross-border projects between local and national authorities and the European Commission; (2) national states may also be a key determinant because they may control flows across borders; finally, (3) the strategies of local authorities, which may co-operate or compete across borders to enhance their autonomy and resources.

In the second part of this paper, these determinants are tested with reference to the Ontario-Michigan border region. It is argued that despite a history of functional interdependencies, free trade becomes a new and influential mechanism that leads local actors to develop economic development strategies to compete with each other. As central and provincial/state levels of government reduce deficits, balance budgets, and/or download policy areas, constraints are greater for local level governments. Competition limits co-operation between the local governments of the Detroit border region.

The Literature on Cross-Border Relations

One argument in the literature on cross-border relations is that market dynamics sustain integrating forces against which central government can do little. For instance, Kenichi Ohmae suggests in "The Borderless World" that cross-border relations result from free trade (1990, 79--101, 1995). The author argues that in the new "Inter-Linked Economy" (ILE) the new borders are those of information flows. Ohmae provides examples of ILE and of natural economic zones across Asia, and compares them to "Region States." (1) He admits that these regions may not be politically as influential as their economies ought to allow them to be. Similarly, Martin Lubin (1988), focusing on cross-border co-operation between Canadian provinces and U.S. states, describes different degrees of co-operation between the province of Quebec, and the states of New England and New York. Lubin argues that such linkages are politically motivated. Antoine Bailly (1988) also explains that the 1976 Convention between all levels of governments of the European Regio Genevenis is a major institutional step for a region that has important labor and economic cross-border flows. Moreover, Denis Maillat argues that a "privileged relationship" which results from a "proximity effect" (1988, 200), itself the consequence of shared language, culture, market proximity or commuter frontier workers, best characterizes cross-border relations.

However, competition may hinder cross-border linkages. This is what Rutan finds in his study of the micro-diplomatic relations between Washington State and British Columbia (1985 and 1988). A background of economic competition and distrust of institutions results in extremely limited relations in scope and intensity. These are mostly informal and personal when they do exist. Thus, cross-border co-operation may not always occur when competition exists.

International organizations might also have interests in cross-border linkages. For instance, the European Commission plays an important role in encouraging cross-border cooperation between local level actors (Commission of the European Communities 1991, 1992). Another example of an international agreement fostering cross-border relations is the United States--Canada, inter-governmental conference for the Great Lakes. The International Joint Commission for the Great Lakes in North America pools numerous partners from both Canada and the United States; federal, provincial and state and municipal governments and agencies, as well as the private sector organizations, interest groups and conservation authorities meet to work out all disputes over the usage of the Great Lakes (Environment Canada, 1993).

Studying the influence of the European Union in Ireland, however, Tannam (1995), and O'Dowd and Corrigan (1995) suggest that local level cooperation is limited, due to the centralized nature of both the Irish and British states and because of the controlling roles of both finance departments. Similarly, Hansen (1985), when studying cross-border cooperation in France and Mexico, highlights the centralist states' reluctance to accommodate cross-border initiatives at the local level, suggesting that nation-states control borders. Hence, cross-border relations may cause tensions between local and central state levels. The activities of non-central governments may endanger national sovereignties. For instance, four case studies outline transfrontier regionalism, arguing that cross-border relations cause intergovernmental tensions because they impinge upon national state sovereignties (Duchacek et al. 1988).

In short there are there are four hypotheses regarding cross-border relations:

* Market forces foster cross-border relations because these forces lead to and then foster systems of functional inter-dependency. This is a functionalist hypothesis, which is similar to Mitrany's functionalist argument (1975).

* International organizations may foster cross-border programs because they develop and manage cross-national institutions, which could provide incentives to local actors to cooperate rather than compete. This is the neo-functionalist hypothesis, which is based on the works of Haas (1958, 1964).

* Central states are able to control integrative forces. States are still important. During the 1960s and 1970s, a realist interpretation of international relations noted that the European Commission was unable either to initiate proposals or to upgrade the common interest. Taylor argues that the interests of member states are the key to convergence (1983). This interpretation of integration would lead us to assume that functional interdependencies do not develop unless they are in the interest of member states (Taylor 1983; Keohane and Hoffman 1991; Moravcsik 1991, 1993). States control the pace and the process of progressive intermingling of national and supra-national institutions. This is the realist hypothesis.

* Competition leads to fragmentation not integration. Individual political actors, seeking to serve their constituents, are not be able to maintain partnership relations across borders. Local governments are not be able to develop mechanisms of co-operation to co-produce policies across borders. The above perspective illustrates the competition hypothesis, which is founded on the dominant paradigm in urban political economy, that of the competitive city. As central governments download...

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