In Silicon Valley 200,000 workers have lost their jobs since 2001, albeit only 6,000 of those jobs headed overseas, Stanford University researcher Rafiq Dossani estimates. But that number will grow, he says, as the offshoring pace accelerates for jobs in software programming and product development. Already 150,000 engineers hack away in Bangalore--20,000 more than in Silicon Valley, the Times of India reports. Cisco used only a few Infosys workers in Bangalore six years ago; now it uses almost 300 contract staff, plus 550 full-fledged employees in its own Bangalore office. In two years PeopleSoft's Bangalore offshore force has grown to 200 freelancers and 350 full-timers.

In one and a half days of academic workshops, scholars from multiple disciplines and across the country and Europe discussed the issue of information incompleteness, and the role in this of the media, and possible media bias. Corporate performance and the media were also discussed.

Ulrike Malmendier of Stanford and a collaborator presented results indicating that media attention on CEOs may be detrimental to the CEOs' future performance. And Lisa George of Hunter College attempted to demonstrate a significant liberal bias in a study comparing the leanings of The New York Times, USA Today, Fox News and others, with the average member of Congress.

Other presentations focused on how media coverage might influence asset prices. Luigi Zingales of the University of Chicago, for instance, attempted to demonstrate that stock prices are most reactive to the category of earnings emphasized by the press. Finally, Andrea Prat of the London School of Economics and David Stromberg of Stockholm University focused on the breakup of government-controlled media and the impact on politics. They examined voter turnout when people have more media outlets to chose among. They attempted to show that Swedish viewers who switched to commercial television become more active voters, and better informed.

The topic of the second-day panels was the corporate scandals that have shaken Wall Street, and the economic crises and bubbles that have troubled international financial markets. The main question examined was the degree to which the media was culpable in hyping or failing adequately to report in the lead-up to these events, or whether as a whole it handled them well. Other questions were whether the media is capable of reducing market failures, increasing accountability and improving transparency, and the degree to which people ought to rely on the media to play these roles.

Among other speakers were Andrei Shleifer of Harvard University, Sendhil Mulainathan of MIT and James Hamilton of Duke University. The journalists included the authors of two books on the Enron scandal: The Wall Street Journal's John Emshwiller, co-author of 24 Days, and Fortune magazine's Bethany McLean, co-author of The Smartest Guys in the Room. Also discussing corporate scandals was the Financial Times' Richard Waters. Discussing Russia and economic crises was Fortune magazine's Bill Powell and the Economist magazine's Edward Lucas.

History shows that these sorts of trade problems can last a long time. In the '80s, Japanese and U.S. semiconductor manufacturers sparred constantly. A truce only began in the '90s when Japan was already mired in an economic slide. Moreover, such trade quarrels can lead to global incompatibilities that linger for years and hurt both importers and exporters. "I believe there are genuine security concerns on China's part, although the domestic industry is also likely to benefit," said Lawrence Lau, the Kwoh-Ting Li professor of economic development at Stanford University. "This happens quite often. Our cell phones do not work in Japan, so the Japanese manufacturers and distributors have a lock in their home market. However, that did not exactly help Japan. By setting a different standard, Japan has actually limited the growth of its own cell phone companies."

ECONOMIC, POLITICAL TIES DISPLACING RIVALRY China's government has sentenced two of its citizens to life in prison for their role in securing prostitutes for hundreds of male Japanese visitors in the southern city of Zhuhai last autumn. The Chinese government is also pressuring Tokyo to turn over the Japanese businessmen who allegedly requested the prostitutes. This story made headlines around the world, and fits well with how the world press typically covers Sino-Japanese relations. Regrettably, such incidents recur with enough regularity to feed the media machine that continues to stir a nationalism rooted in conflicting historical memories. Japanese Prime Minister Junichiro Koizumi's annual visits to the Yasukuni Shrine -- which is widely viewed as a symbol of Japan's former militarism -- is a conspicuous example of this. The publicity that the press gives to these visits has helped impede an invitation to Koizumi from China's leaders for a state visit. Recently, the discovery of mustard gas canisters left behind by Japanese forces during World War II has also served to keep memories of the Imperial Japanese Army's wartime conduct alive among older Chinese. Moreover, rival Sino-Japanese claims to the Senkaku (or Diao Yutai) Islands resurfaced last year when the Japanese government leased three islets in the chain from private parties. The action, purportedly undertaken to reduce the prospect of landings and demonstrations by Japanese right-wingers, set off a brief, though frenzied, reaction in China, as well as in Hong Kong and Taiwan. Meanwhile, differences over Taiwan also foster tensions periodically, such as when former Taiwanese President Lee Teng-hui sought to visit Japan for medical treatment. But this is not the whole story. Although such incidents reveal a troubling level of mistrust between the Chinese and Japanese that is not merely a product of media coverage, it is noteworthy that both governments have worked consistently, diligently, and with considerable success to resolve such problems and contain their political fallout. Of course, official relations between the two countries are marked by much political and economic competition -- some of it healthy, some of it a possible harbinger of future strategic rivalry. The competitive strain in Sino-Japanese relations is especially visible in energy politics. Demand for oil in Asia is growing rapidly, and with China and Japan increasingly dependent upon imports, each has naturally sought to improve its energy security by diversifying sources of supply. Both countries covet access to Russian reserves, especially those located in the Angarsk fields of Siberia. Last spring, China appeared to have locked up a Russian commitment to build a pipeline to service the China market at Daqing. Japan, however, raised the ante with new offers of financial incentives. Its bid for an alternative pipeline to Nakhodka to serve Japanese, Korean and other markets remains alive, creating another point of competitive friction. In their rivalry for leadership in promoting Asian regional cooperation, meanwhile, China has taken an early lead. Nearly two years ago, China trumped Japan by offering a Free Trade Agreement to the members of the Association of Southeast Asian Nations, while front-loading its own tariff concessions. But this backdrop of contention and competition masks emerging collaborative aspects of Sino-Japanese relations that are profoundly important. For example, trade and investment flows continue to expand rapidly. Bilateral trade topped $100 billion in 2003, as Japan's exports to China increased by more than 10 percent, fueled by semiconductors, electrical equipment and automobiles. Meanwhile, China replaced the United States as Japan's biggest source of imports, and is now one of the few non-members of the Organization of Petroleum Exporting Countries with which Japan runs a trade deficit. Similarly, direct investment by Japanese firms is increasing as they relocate production facilities to China to capitalize on lower labor costs and high-quality engineering talent. Of course, there is no assurance that today's expanded commerce will preclude eventual strategic rivalry, or succeed in erasing lingering wartime animosity. But both countries now place a premium on extending their economic interdependence. Ultimately, the historical wounds that have long divided China and Japan, and the more current diplomatic flash points that the global media inevitably trumpet, tell only part of the Sino-Japanese story. There are economic and geopolitical rivalries between China and Japan that dwarf in importance the high-profile insults to national pride that make headlines. But there are also compelling economic and political inducements toward cooperation that prevent these rivalries from developing into full-blown crises. MICHAEL ARMACOST is a former U.S. ambassador to Japan and is a distinguished fellow at the Asia/Pacific Research Center of Stanford University. He wrote this article for Project Syndicate.