If internet platforms experience similar governance problems as weak states, as this chapter argues, then it follows that one possible solution to resolving the social harms they cause is to do the same sort of thing that developed companies do when real-world states are unable to govern their territory: help them build institutions to govern more effectively. This chapter defends such an approach against criticisms related to the risk of overly empowering private companies or developed western countries.

Drawing on the examples of the ICC and ICSID, this chapter shows how international arbitration has successively embraced a ‘relation-based’ and then a ‘rule-based’ model of governance. Initially, the systems of dispute resolution promoted by the ICC and ICSID displayed the features of the relation-based model. The ICC and ICSID sought to promote self-governance by pooling information concerning traders. A related goal was to encourage repeat business by creating an equitable method of dispute settlement that relied, to a large extent, on the participation of its users. The second step came, however, when self-governance failed to sustain cooperation, leading both the ICC and ICSID to promote a rule-based model of governance where third party-arbitrators and arbitral institutions gained increasing powers over the disputing parties. As a final step, arbitral tribunals evolved towards a fully judicialised system of dispute resolution, causing them to increasingly resemble national courts.

In parallel to the centralized governance of strategic industries in Chapter 4, the lower degree and narrower scope of the perceived strategic value of labor intensive and less value-added sectors, represented by textiles, for national security and the national technology base, has shaped decentralized governance and private governance in nonstrategic sectors. In the context of sectoral structural and organization of institutions, less concerned about controlling products or services that have few applications for national security and low contribution to the national technology base, the central state introduced competition in textiles in the 1980s and devolved market coordination of quasi-state and private ownership to local governments and commerce bureaus by the early 1990s before China’s World Trade Organization accession. The cross-time sector and company case studies reveal the interacting strategic value and sectoral logics apply at the subsector. Capital-intensive and more value-added technical textiles experience more deliberate market coordination by local governments and the central state and are characterized by mixed property rights sponsored by and connected with state-run research and development institutions. Taken together the textile industry today experiences periodic overexpansion, environmental degradation, and reactive local state interventions in response to economic reverberations and central-level environmental and developmental mandates.

This chapter demonstrates that the lower degree of and narrower scope of the perceived strategic value of labor-intensive, non-value-added sectors, represented by textiles, for national security and resource management, has shaped their decentralization beginning under Gorbachev’s perestroika. Mass privatization after Soviet breakdown further reenforced the private governance pattern dominant in apparel and clothing. The cross-time sector and company case studies disclose the interacting strategic value and sectoral logics and show apparel and clothing factories have shut down or privatized to former managers only to languish with antiquated equipment. Today, Russian textile and garment manufacturers are outcompeted by illegal imports from China and the Commonwealth of Independent States. Industrial and technical textile sectors, which incorporate oil and petrochemicals and higher technological intensity, in contrast, experience the state intervention from central and regional governments of decentralized governance in response to political and economic pressures, such as oil boom and bust cycles and Western sanctions in post-Crimea annexation. The central government has designated petrochemicals a critical input for chemical fiber processing and provides fiscal incentives to develop technical textiles. Local governments have worked with local and national oligarchs to revive factories and production lines, and courted foreign direct investment.

Food, more than any other commodity, is surrounded by a vibrant debate concerning competing modes of production, ranging from the preferability of industrial farming as against small-scale farming, to genetically modified production as against organic production and to global production as against local production. The resulting demand for food with specific material and immaterial attributes has contributed to the rise of certification schemes along the value chain. Beyond being mere information intermediaries, such certification schemes can best be understood as ‘polycentric’ governance tools that give voice to non-economic rationalities in governing global production. Put this way, certification e.g. for sustainable food production holds a mirror up to competition law theory. In dealing with such private governance initiatives, competition law finds a pertinent terrain to conceptualize and implement its own ‘polycentric’ objective of constitutionalizing markets. In particular, competition law can and should formulate guidelines to meaningfully distinguish between different private governance initiatives to critically engage with the known flaws in the incentive structure of certification.

Chapter 4 starts by presenting two broad critiques of the private governance literature. First, this research sometimes assumes that groups can self-regulate without group leaders. While this might be the case for some small groups, leaders are critical for cooperation in many groups. Second, scholars have overlooked the obstacles group leaders must overcome in order to govern well – such as impediments to truthful information sharing and impartial dispute enforcement – which has generated the faulty assumption that private order will emerge when it is needed. It then develops the logic of the argument, which sheds light on the conditions that make private trade-promoting policies more likely. While previous studies of private groups suggest that private institutions substitute for public institutions, the book’s argument is that state threats can encourage private good governance; private associations will predate without public institutions that force them to behave otherwise. The chapter also introduces the role of within-groups competition, theorizing about how competition increases the hurdles to private group leaders implementing trade-promoting policies. It then discusses the possibility of group leader-politician collusion, along with the way that relational contracting relates to the argument.

Based on a year of fieldwork in Lagos markets, Chapter 5 looks in depth at four markets, demystifying leadership behavior and the role of politics, and testing the part of the theory that focuses on threats and leader strength. The first market is an archetype of private good governance, and the chapter assesses the extent to which the conditions that sustain these policies are consistent with the book’s theory. The other three markets are governed by leaders who fail to create supportive environments for traders. Prior studies assume that such groups disappear quickly, as current group members abandon them and prospective group members decide not to join. The chapter documents that these groups can persist for much longer than previously assumed. One of the markets highlights a special type of group: one in which the group leader extorts from their own members. Previous studies have assumed that group members are mobile and would simply move to a better group if a leader attempted to extort from them, and that group leaders would therefore refrain from extorting for fear of losing members. This case study illustrates how predatory leaders exploit traders’ immobility.

Chapter 7 first summarizes the book and assesses the conditions under which government threats will motivate private good governance. The second half of the chapter considers the policy implications of the book’s findings. It proposes that private governance – and, in turn, economic development – is best supported not by an absentee state or by massive state intervention in trade. Rather, a middle ground is ideal. It argues that regardless of one’s assumptions about how economic growth in private groups shapes the broader economy, since private groups control a massive portion of most economies, growth within these groups is important for its own sake.

In many parts of the world property rights are not publicly guaranteed. Private market associations can fill this gap by providing an institutional structure to enforce agreements, but with this power comes the ability to extort from group members. Chapter 1 introduces the book’s motivating puzzle: Despite shared need for private good governance, not all private group leaders provide pro-trade policies. Under what circumstances do private associations provide a stable environment for economic activity? The chapter introduces the book’s main argument, that threats from the government can motivate group leaders to provide trade-promoting policies, but that within-group competition matters as well. The chapter then overviews the book’s key theoretical contributions to the political economy of development and private governance literatures. Next, it introduces theoretical expectations for additional variables, besides government threats and competition, that could shape private good governance. It then provides an overview of Lagos, Nigeria, the context in which the research takes place. Last, it overviews the book’s methods, and provides a road map for the rest of the book.

After setting out the centrality of governance to understanding and engaging with energy transitions, I show how ideologies and strategies of governance have been shaped by broader shifts in capitalism around neo-liberalism regarding the role of the state and the re-scaling of the global economy through processes of globalisation. I show how at every level from local, city, national, to regional and global governance, political systems reflect and are imbued with the structural and material power of incumbent energy providers and interests, reinforced by institutional power through high levels of access and representation in the key discussion and decision-making centres to frame their needs as congruent with those of the state and their energy pathways as the most viable for tackling the energy trilemma of energy poverty, security and sustainability. I describe an energy governance complex: a web of distributed (but unevenly concentrated) power and agency over different parts of the energy system and its multi-functionality. Ecologising governance draws attention not only to its interconnections and interdependencies but also to its ecological blindness.

The chapter considers, on the one hand, the ways in which international arbitration was a source of inspiration for Philip Jessup when he elaborated the notion of transnational law. On the other hand, it considers how the notion of transnational law constitutes a relevant tool for the analysis of international arbitration. The chapter relies in particular on the documents gathered in the Philip C. Jessup Collection at the Library of Congress, which include early drafts and preparatory works for the Storrs Lectures at Yale University. It examines three discrete stories that each illustrate one salient aspect of the notion of transnational law (norms, actors and processes) and its relevance for the analysis of international arbitration.

Corporate groups are giving way to contractually organized global value chains, and any effective approach to regulating sustainability must thus account for contractually organized production. This chapter outlines the move from corporate governance to governance through contract in organizing production and the general effects of this move on sustainability regulation, and presents one approach towards conceptualizing control in contractually organized value chains. It then discusses recent approaches related to private governance, private law liability, and public regulation that are aimed at developing sustainability in contractually organized global value chains.