Global Economic Institutions

Throughout modern history the growing integration of the world economy has increased the exchange of goods and services. Such exchange is physically made possible by transport and communication. ¹ The increase in volumes transported and information communicated has gone hand in hand with considerable technological development. Existing modes of transport have seen their modes of production revolutionized. Sea transport, for instance, has seen the changeover from the sailing ship to steam-powered vessels and then to diesel powered ships. New modes of transport have been added (e.g. air transport). Overall, transport and communications have increased much faster then GDP.

The public sector has at one stage or another seen the need to regulate the international aspects of the use of the (new) technology. This has been the case for both ocean-going transport, for border-crossing railways, for air travel and for telecommunications. The form chosen was generally the intergovernmental agreement that set up a specialist international organization. These covered typically aspects such as technological standards (to guarantee safe switching between national systems); rules for cost and revenue sharing and so on. The aim of this chapter is to explain the wide diversity of forms that have been chosen for the different modes. ² We will go subsequently into the cases of sea transport (mainly goods), air transport (mainly passengers) and telecommunications (mainly speech and data) and the Internet (mainly information and data). The set-up of each of the sections will follow the same pattern that we followed in the previous chapters. The sequence is description of the problems (mostly of two types: stability of markets and safety), definition of the public good, characterization of the organizations involved, assessment of the instruments in use and finally evaluation of the case.

As usual, the chapter will be rounded off with a summary of the findings.

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