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I propose and test a theoretical framework that explains institutional change in international relations. Like firms in markets, international institutions are affected by the underlying characteristics of their policy areas. Some policy areas are prone to produce institutions facing relatively little competition, limiting the outside options of member states and impeding redistributive change. In comparison, institutions facing severe competition will quickly reflect changes in underlying state interests and power. To test the theory empirically, I exploit common features of the Bretton Woods institutions—the International Monetary Fund and World Bank—to isolate the effect of variation in policy area characteristics. The empirical tests show that, despite having identical membership and internal rules, bargaining outcomes in the Bretton Woods institutions have diverged sharply and in accordance with the theory.

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American Journal of Political Science
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Phillip Lipscy
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On April 22, 2015, the Wall Street Journal published the article “China Warns North Korean Threat is Rising,” reporting on estimates from Chinese and American nuclear experts of the DPRK nuclear arsenal. The article quotes CISAC’s Siegfried Hecker, director of the Nuclear Risk Reduction Project, on his assessment of the North Korean nuclear crisis and presents the estimates of Dr. Hecker’s Chinese counterparts. In the following Q&A, Hecker, who has been an authority in the United States on technical assessments of the progress of the North Korean nuclear program — having visited North Korea seven times since 2004 and having been granted unprecedented access to North Korea’s Yongbyon nuclear facilities — discusses the information presented in the Wall Street Journal article and provides insight both on the nature of technical estimates of the DPRK nuclear arsenal as well as on the critical takeaways from these assessments.

What was the nature of the meeting referenced in the Wall Street Journal article in which China’s estimates were presented?

This meeting was an off-the-record, non-governmental, non-official dialogue on U.S. – China security issues. The discussion on North Korea’s nuclear program was one of many security topics discussed. Both Chinese and American experts made presentations. The headline of the WSJ article is misleading – it is not “China” that made these estimates, but Chinese nuclear experts.

Have you conferred with Chinese nuclear experts about the North Korean nuclear program before the referenced meeting?

As part of my Nuclear Risk Reduction project at Stanford University, I have conferred regularly with nuclear and policy experts in China and Russia, as well as American experts and officials, of course. We have done so since January in 2004, when I first visited the Yongbyon Nuclear Center and returned through Beijing (the normal transit in and out of Pyongyang).

On that trip, North Korean nuclear officials showed me plutonium metal that they had reprocessed from the spent fuel rods that were stored since the beginning of the Agreed Framework in 1994. When the Agreed Framework fell apart in late 2002, Pyongyang expelled the international inspectors and withdrew from the Nonproliferation Treaty.  I believed they showed me their nuclear facilities and the plutonium to try to convince Washington that they had the bomb.

How did these visits inform your assessment of the DPRK nuclear program?

I visited North Korea seven times in total, with four of those visits to the Yongbyon Nuclear Center. After each of these visits, I compared observations and analyses with Chinese nuclear experts. During the first few visits, the Chinese experts and Chinese international relations scholars were quite skeptical of North Korea’s nuclear capabilities. I believe that my observations helped to inform their subsequent analysis since Chinese experts did not have access to Yongbyon at the time.

So what precipitated the change in the perception of your Chinese colleagues of North Korea’s nuclear capabilities?

During the first few years of discussion, my estimates of North Korea’s capabilities exceeded those of Chinese experts.  However, during my most recent visit to Yongbyon in November 2010, North Korean nuclear officials showed me their newly constructed uranium enrichment facility, housing 2,000 modern centrifuges, and the beginning of the construction of an experimental light water reactor. Overhead imagery shows that the exterior of the reactor is essentially complete, that the size of the centrifuge hall has been doubled, and that significant additional construction has occurred in the fuel fabrication complex, where the centrifuge facility is housed.

Pyongyang’s move to augment their limited plutonium production in the 5 MW-electric reactor (at most one bomb’s worth of plutonium per year) with enriched uranium changed the game.

Changed the game, how?

It opened the second path to the bomb and made it difficult to assess North Korea’s nuclear capabilities. Unlike the reactor production of plutonium, centrifuges are easy to hide. So, post-2010 it became more difficult to make accurate estimates, but all of us believed that North Korea enhanced its nuclear capacity significantly.

I published my most recent estimates in an article in the Bulletin of the Atomic Scientists along with a brief history of North Korea’s nuclear build-up. The latest estimates by Chinese nuclear experts now exceed mine. I believe that we base our estimates on the same open-source data.

If you base your estimates on the same information, what accounts for the discrepancies between your assessments and the estimates from your Chinese colleagues?

Developing these estimates is not an exact science. There are huge uncertainties in estimating the enrichment capacity that is likely present at covert sites. One particular problem is the difficulty in assessing how much indigenous capacity North Korea has to make the key materials and components for centrifuges. To demonstrate the great uncertainties, the WSJ article cites a recent report by David Albright of the Institute of Science and International Security that shows the possible range of bomb-fuel capacity in 2020 to vary from 20 to 100 bombs. The Chinese experts’ and my estimates fall within that range.

The Wall Street Journal article reported that American officials recently stated that North Korea possesses an intercontinental ballistic missile with sufficient range to reach the United States. Is the threat of nuclear attack on the United States from North Korea imminent?

I view the threat to the United States posed by an untested missile, the so-called KN-08, with a hypothetical miniaturized nuclear warhead as unrealistic any time in the near future. The KN-08 has not been tested to our knowledge. I believe North Korea would require more long-range missile tests and more nuclear tests to pose a direct threat to the United States.

With the international community’s attention directed toward the U.S.-Iran nuclear deal, what are your thoughts on the analogy made in the article between the Iran Nuclear Deal and the 1994 Agreed Framework with North Korea?

I don’t concur with the analogy of the failings of the Agreed Framework to the potential Iran deal. It is true that North Korea continued to develop uranium enrichment capabilities during the Agreed Framework. However, without the Agreed Framework, North Korea could have produced a nuclear arsenal as large as they have today 10 years earlier. And, by terminating the Agreed Framework, Washington traded the threat of uranium bombs that was at least 10 more years away for plutonium bombs that were built within a year.

Then what is the critical takeaway from your and your Chinese colleagues’ assessments of North Korea’s nuclear capabilities?

The real tragedy, in my opinion, is that whereas in 2003 North Korea likely had no nuclear weapons, it appears to have a rapidly expanding arsenal today. During the past 12 years we have witnessed the North Korean program grow from having the option for a bomb in 2003, to having a handful of bombs five years later, to having an expanding nuclear arsenal now.

Why does an expanding arsenal matter?

I believe it has made Pyongyang increasingly reliant on its nuclear weapons for regime survival and has dimmed the prospect of a denuclearized Korean peninsula. Such an arsenal may instill Pyongyang’s leadership with a false sense of confidence and almost certainly expands what it may think are its tactical and strategic options. The potential for miscalculations and accidents increases, and the consequences will be greater if it has more bombs and more sophisticated bombs with greater reach.

 

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The Stanford Silicon Valley-New Japan Project
Public Forum Series with Networking

 

Casey Wahl is the CEO and founder of Wahl & Case K.K., a Tokyo-based global recruitment firm with a focus on startups and cross border expansion.  Mr. Wahl has many years of experience in the Japan and is also the founder of Red Brick Ventures, an angel investment and incubation platform.  He recently published a book in Japanese (english version to come), containing the stories of several Japanese entrepreneurs, giving insights into the challenges they face and their journeys to success.  He will be discussion characteristics of the labor market for startups in Japan and how Japanese companies can best hire talent in Silicon Valley.

 

Thursday, May 14, 2015
4:15 – 5:30 pm Lecture
5:30pm - 6:00pm Networking
Cypress Semiconductor Auditorium (CISX Auditorium)

Public Welcome • Light Refreshments

The Silicon Valley - New Japan Project

Cypress Semiconductor Auditorium (CISX Auditorium)
Paul G. Allen Building, Stanford University
330 Serra Mall, Stanford CA 94305
**Entrance is the Serra Mall side of the building**
https://www.google.com/maps?q=CISX+Cypress+Semiconductor+Auditorium@37.4295793,-122.1748332

Casey Wahl CEO and founder of Wahl & Case K.K
Seminars
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In this session of the Shorenstein APARC Corporate Affiliate Visiting Fellows Research Presentations, the following will be presented:

Jaigeun Lim, Seoul Metropolitan Government, "A Study on the Influential Factors on Inbound Foreign Direct Investment and its Implications"

The global importance of Inbound Foreign Direct Investment (IFDI) continues to grow and each nation has made an effort to enhance its national competitiveness through IFDI.  Lim’s research targets 51 nations and 14  candidate variables to learn which factors have an influence on IFDI.

Statistically meaningful variables on IFDI include GDP, economic growth rate, dependency to trade, management of cities, small and medium-sized enterprises’ efficiency and investment incentive policy.  Particularly, the results from Outbound Foreign Direct Investment (OFDI)-oriented nations give evidence that influences of GDP, small and medium-sized enterprises’ efficiency and investment incentive policy are positive to IFDI.  However, Korea shows the lower level of performances in small and medium-sized enterprises’ efficiency and investment incentive policy.  Korea has also shown the lower performances in similar variables compared with other Asia-Pacific nations.  Lim’s research aims to find out what these results mean in terms of policy for Korea?

 

Ryuichi Ohta, Japan Patent Office, "Relationship Between Technical Standard and Patents"

Samsung and Apple have more than 50 cases of appeals to the courts against each other in more than 10 countries.  In these court battles, Samsung asserted injunction using essential patent which is related to telecommunication standards and committed RAND (Reasonable And Non-Discriminatory) commitment.  Injunction is one of the basic rights for patent, which means Samsung can assert this right.  However in this case, can Samsung assert injunction in spite of RAND commitment?  In normal circumstances, standard organizations require RAND licensing obligations for essential patents.  Ohta will address the question "Why do they require it and why do they consider these obligations are reasonable for essential patents?" through case studies.

 

Rajeev Prasad, Reliance Life Sciences, "Concept of Total Quality Management in Pharmaceutical Industries"

The pharmaceutical industry is profoundly regulated and the reasons are obvious;  the use of ineffective, poor quality, harmful medicines can result in therapeutic failure, exacerbation of disease, and resistance of medicines and sometimes death of the patients.  Also, the mistakes in product design or production can have severe, even fatal, consequences for patients which sometimes lead to recall of drugs from the market.  Total Quality Management (TQM) acts as an umbrella under which everyone in the organization can strive for customer satisfaction by producing better quality of product, reduce cost and wastage and increase the efficiency of services.  In his research, Rajeev has focused on the failures of TQM principles by evaluating the warning letters, case studies of pharmaceutical manufacturers and product recalls and also outlined about the implementation of robust quality management system by amalgamation of principles of TQM and pharmaceutical regulatory guidelines.

Philippines Conference Room

Encina Hall, 3rd Floor, Central

Jaigeun Lim Seoul Metropolitan Government
Ryuichi Ohta Japan Patent Office
Rajeev Prasad Reliance Life Sciences
Seminars
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In this session of the Shorenstein APARC Corporate Affiliate Visiting Fellows Research Presentations, the following will be presented:

Zhao Han, PetroChina, "The Development of American Oil Retail – Analysis of the Competitive Strategy in China"

The first gas stations were built in the early 1900s.  Having experienced rapid growth, brand integration, rising costs, model innovation and trans-boundary competition in developed countries like the United States, the gas station industry matured towards the end of the 20th century.  Around the year 2000, international oil companies gradually began to withdraw from the gas station market in developed countries.  During this time, convenience stores became the leader of the market with gasoline being one of the products of the convenience store.

With the development of mobile internet technology and the practice of the big data theory, the information authority has been broken.  The business model of traditional industries, such as the gas station industry, will change as well.  Gas stations will transform from the traditional E-station to E-platform.  In his research, Han argues that the business model of gas stations will turn from merchandise sales to customer service, and then to resource integration and platform management.

 

Yasunori Matsui, Mitsubishi Corporation, "How to Develop Effective Leadership Skills:  A Study Comparing Silicon Valley Companies"

In most Japanese companies, leadership skills are lacking.  From his experience, Matsui believes this problem exists at a higher level than the organization, as leadership skills are only developed for select people within the organization.  Additionally, he believes there is a high correlation between leadership effectiveness and the results that leaders produce.  Developing an adequate cadre of leaders to perpetuate their organization is essential to Japanese companies.  Unfortunately, the concept of leadership continues to be shrouded in misunderstanding.  In his research, Matsui compares leadership styles in Silicon Valley to those of Japanese companies.  Matsui asks the question as to whether leadership personnel training is possible in Japanese companies and discusses some possible solutions to this problem.

 

Ryo Wakabayashi, Sumitomo Corporation, "Trends of the American Entertainment Video Industry"

Wakabayashi’s research discusses the entertainment video industry trends in the United States, in particular, the influence of emerging Over-the-Top (OTT) markets in existing entertainment video industry.  Over the past few years, online video streaming services, called “Over-the-Top”, have rapidly become popular and have deprived the subscribers from existing Pay-TV companies.  The reasons why OTT services have taken advantage of existing markets are 1) the infrastructures for their services have drastically improved -- faster internet access speeds and various devices such as smartphones, tablets, and Set-Top-Boxes that are suitable for watching video being released and becoming popular; 2) subscription fees for services are about six times less than the fees for existing Pay TV services like cable TV or satellite TV; and 3) OTT markets have attractive content such as movies, dramas, TV shows, and animated videos and have started producing their own original, high-quality content.  As a result of the growth of the OTT market, Wakabayashi discusses three big trends that are emerging in the video industry in the United States – 1) Video streaming providers are becoming the “New Network”, 2) Large consolidations are emerging and 3) Existing media companies are going toward OTT markets.

Philippines Conference Room

Encina Hall, 3rd floor, Central

Zhao Han PetroChina
Yasunori Matsui Mitsubishi Electric
Ryo Wakabayashi Sumitomo Corporation
Seminars
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In this session of the Shorenstein APARC Corporate Affiliate Visiting Fellows Research Presentations, the following will be presented:

Tsuyoshi Koshikawa, Ministry of Finance, Japan, "Consideration of the Best Practice of Financial Administration – Through a Comparison Between the United States and Japan"

Japan has experienced two big financial crises.  One was the so-called “Non-performing Loan Problem” approximately from 1997 to 2003.  The other was the Global Financial Crisis, especially represented by Lehman Brothers Securities bankruptcy in September 2008 and originally caused by the so-called Subprime Loan Problem that occurred in the United States in the latter part of 2006.  Especially concerning the latter crisis, there have been active discussions among scholars and international organizations and each financial regulator carried out rule-making and policy-making in order to prevent the next crisis.  As a result, for example in the United States, the Dodd-Frank Wall Street Reform and Consumer Protection Act was established in July 2010.  But even now these discussions have been continuing in G20, Financial Stability Board, Basel Committee on Banking Supervision and so on.  What is the best practice in order to realize trustworthy protection of users and improvement of convenience, which is the biggest issue along with ensuring stability of the financial system?  In his presentation, Koshikawa will introduce recent discussions through a comparison between the United States and Japan and argue implications in the best practice of financial administration.

Changbao Zhang, PetroChina, "Reformation & Improvement of International Human Resource Management of Chinese State-Owned Petroleum Enterprises"

China has the most quantity of state-owned enterprises (SOEs) and state-owned property in the world.  Almost every field and industry of the national economy is involved with SOEs.  The implementation of China’s open policy and “going out” strategy are gradually pushing Chinese SOEs into the competition of the global market.  Compared to western companies, the gap in technology is not as big as management, especially in human resources management (HRM) which is influenced by politics, economy, society, history and traditional culture.  Zhang has analyzed and compared the history, current situation and future direction of HRM of Chinese SOEs and that of western companies.  Based on his findings, Zhang proposes suggested solutions focusing on the enterprise micro-level HRM with the case of China National Petroleum Corporation (CNPC).

Philippines Conference Room

Encina Hall, 3rd floor, Central

Tsuyoshi Koshikawa Ministry of Finance, Japan
Changbao Zhang PetroChina
Seminars
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In this session of the Shorenstein APARC Corporate Affiliate Visiting Fellows Research Presentations, the following will be presented:

Yoshihiro Kaga, Ministry of Economy, Trade & Industry, Japan, "The Roles of University-Industry Collaboration for Promoting Innovation"

The existence of top class universities, especially those ties with industry, is regarded as one of the key characteristics of the Silicon Valley ecosystem, where the most successful innovation-based economic growth in the world is observed today.  Kaga has conducted a literature review of previous research on this topic and research on Stanford organizations facilitating university-industry ties.  Kaga will present his findings and share implications for policies in Japan.  His research is in cooperation with Shingo Nakano.

Feng Lin, ACON Biotechnology, "Innovations in China Primary Healthcare Reform: Development and Characteristics of the Community Health Services in Hangzhou"

One of the five major tasks for China’s health reforms launched in 2009 was to promote the development of a primary healthcare system.  Hangzhou is one of the cities with a long history in China for developing community health services.  Lin has studied the model of community health services in Hangzhou, which is characterized as government-led, guaranteed with enough funding, personnel, space and regulation; supported by a unified information platform; and the assigned central role of general practitioners as health “gatekeepers”.  His data collection and analysis have indicated that the basic health status of residents in Hangzhou is comparable to that in Western developed countries.  Based on these findings, Lin proposes that the primary healthcare level in Hangzhou will be further developed and promoted with the indexed performance evaluations and more effective implementation of additional measures.

Shingo Nakano, Ministry of Economy, Trade & Industry, Japan, "Policy Implications for Increasing the Number of Start-ups in Japan"

As mentioned in “Japan Revitalization Strategy (Revised in 2014),” it is critical for Japan to develop an environment where venture businesses are launched one after another.   The Japanese government has taken some measures to this end, but significant obstacles - such as institutional, human, financial, etc. - remain for venture businesses.  Nakano's research looks at how to eliminate these obstacles, while focusing on increasing the number of start-ups in Japan.  Based on his findings, Nakano will discuss some policy implications for improving the Japanese start-up ecosystem.  His research was conducted in collaboration with Yoshihiro Kaga. 

 

Philippines Conference Room

Encina Hall, 3rd Floor, Central

Yoshihiro Kaga Ministry of Economy, Trade & Industry, Japan
Feng Lin ACON Biotechnology
Shingo Nakano Ministry of Economy, Trade & Industry, Japan
Seminars
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