Two Logics of Regional Integration and the Games Regional Actors Play A Theoretical Framework for the Analysis of Regional Economic Cooperation and Defection

Our main argument is that there exists not only an intraregional, but also an extra-regional rationale for regional integration. The latter is more important for developing regions, where intraregional economic interdependence is usually low. Within the extra-regional logic of regional integration, the member states of developing regions cooperate in order to profit from size and stability effects in the global competition for investment and export shares. Regional markets are necessarily larger than national markets and integrated regions are deemed to be more stable in macroeconomic and political terms. These effects make the respective regions more attractive as sites of investments and as negotiation partners in interregional or global trade negotiations. Because of the dominance of the extra-regional logic, the demand for regional integration in developing regions is different to that in industrialised regions, but this has also effects for the supply of regional integration. Extra-regional interests motivate, but also constrain the motivation of regional powers to provide regional leadership. When important extra-regional economic privileges of regional powers are in conflict with regional integration, the respective countries are likely to defect in order to protect their interests. In this case, the regional powers do not provide leadership, but they become regional ‘Rambos’ with the dominant strategy of defection in order to protect their privileged position in the struggle for extra-regional investment and export shares.

The phrase ‘the games regional actors play’ is a reference to Scharpf’s book The Games Real Actors Play (Scharpf 1997).