Role of trade associations in economic development - II: Academic, professional inclination

The changes in the patterns of world governing institutions are directly correlated with the changing preferences in elites professions. Military titles have always been considered an elite profession in the history, because of the militancy requirement to change and control over the resources and political governance of a country.
Then, the colonisation regime promoted the club culture and role of the civil servants. Political administration in the colonisation regime was not possible without unrestricted powers of the civil bureaucracy. To become a civil servant was a natural choice of the educated cream at that time.
Rapid industrialisation, growing developmental works, sense of civic services and emerging role of a civil society shifted the ranks and preferences by creating sufficient space for the technocrats and specialists in engineering, technology, health, law, accounting and other professions. Just after this regime, mass consumption, growing trade activities, financial liberalisation, global flows of capital and multinational corporations created a new class of elite as 'corporate executives'.
During the transition from cold war era to globalisation regime, the responsibility of the transformation of the concepts of the common values, modernity, human rights, and democracy, emphasised the dire need of the NGOs. Social scientists played important role in this transformation.
Implementation of free trade policies in the recent past, emphasised on the importance of economic integration, bilateral and multilateral trade agreements, protectionism, trade diplomacy, regionalization and the greater role of private sector in determination of economic development.
The nexus of trade policies, foreign affairs, and cross border mobilisation of capital emphasised on the enhancement in the role and scope of national and regional trade bodies. To get influential positions in the trade bodies and change in the prioritisation of livelihood is a natural consequence of the new scenario.
The power and role of the chambers in global polices has been studied and contemplated by various analysts. Betty Freauf - a former Oregon Republican Party activist having served as state party secretary - aggressively viewed against the powerful role of the Chamber of Commerce in his article, "Is the Chamber of Commerce a UN front?".
He says that world is being restructured by the Chamber of Commerce. According to him, Most people, including Chamber of Commerce members, would be astonished to learn the extent of power that organisation exerts over international, national, state and local policies. With the exception of a few leaders at the top, most members never learn about the inner sanctum of the Chamber, which appears to think locally, but actually act globally.
Another notable researcher and writer is Erica Carle. She presented an unbelievable picture of the role of Chambers of Commerce in her article, "The Chamber of Commerce; Its power and Goals". She mentioned that, "it is common knowledge that the Chamber has lobbyists in Washington and state legislatures, and that it is active in local communities.
These activities are no secret. They can be noticed by the casual observer, and are expected by members. But there is a great deal more which must be understood in order to gain a concept of the real power of the Chamber of Commerce - not only over commerce, education, religion, technology, industry, agriculture, transportation, medicine, communication, labour and government.
To understand this power we have to look beyond the local communities to the Chamber's national and international activities, and to Chamber ties with other organisations, both governmental and non-governmental. Two slogans were popularised in order to gain backing for Chamber leadership: "World peace through world trade," and "More business in government and less government in business."
By virtue of their broader jurisdiction and structural association with the local chambers and trade associations, the national chambers of commerce represent the business sector of their countries in the regional and international chambers of Commerce. More or less all the national chambers of commerce participate in the international economic policy dialogues. Like the Unites States Chambers of Commerce, the national and regional chambers are aimed to participate in policymaking and economic governance in the globally integrated economies.
Despite the local chambers' representation, the role of national and regional chambers is quite different and has a higher-level position in the hierarchy of the functions and objectives. All national chambers form the standing and ad hoc committees with specific technical expertise that can be deployed to advocate the public policy. 'Policy Advocacy' appeared to be a term to describe the frequency with which chambers or trade associations briefed Ministers, Parliamentary Committees and senior civil servants.
It also describes the extent to which those policymakers accepted the arguments made by the chambers. Trade organisations primarily focus on lobbying the legislature for preferential regulatory treatment.
The role and activities of the local chambers and trade associations usually belong to the prevailing issues of the local business community. They may seek participation in the policy-making processes on the basis of expertise or representation.
Andrew Tucker from the University College London has raised several questions on the role of trade associations in his article published in the 'Business and Politics'. He discussed that what do the trade associations actually do, how do they further their members' interests with stakeholders like regulators, industry financial analysts, employees, suppliers, and the media.
The paper builds a model that drives the dynamic relationship between trade associations, firms and multiple stakeholder groups. According to Tucker, economic incentives, trustworthiness, and promises are the main clusters of the reasons to join the trade associations by their members; while to create a buffer zone between the business enterprises and policy makers and the inter-industry debates are also important reasons to join the trade associations.
According to the survey, majority of the members join the trade association because of the specified nature of their industries. Making self-regulations, achieving creditability, getting expertise in specific industry issues, speaking with a unified voice to media, specific promises, and forming collective policy position are the main reason to join the trade associations. Getting tipping points for business, try to change the rules of the game and collective buying power are the less important reasons to join a trade association.
The role of trade associations, chambers of commerce, large corporations and the business groups in the economic development has become an important area of research which lead to the drastic development in the literature of business economics.
Now, Business Economics has become an important branch of the applied economics (It does not mean the basic economics which is being taught in the business schools of underdeveloped countries under the false title of business economics).
To provide a forum for research and debates on the contemporary issues in Business Economics, the National Association of Business Economists are serving in the United States and other industrialised countries. These associations have close association with the National Chambers of Commerce. Various economists have been analysing on the productivity, importance and the role of the local chambers and the trade specific association.
Aldrich, Fiol, and Staber from Cambridge University, Arendt from University of Chicago, Axelrod, from New York, Benhabib from Princeton University, Dowling from Oxford University, Fombrun from Harvard Business School, Fukuyama from John Hopkins University, Gutmann from Harvard University, Harré from Cambridge University, Lehne from New York University, Olson from Harvard University, North from Cambridge University, Olson from Harvard University, and Shapiro from Oxford University are famous research scholars in the filed of business economics who have been serving on the role of large business houses and the business representative associations in the economic and socio political development and changes in the global business and financial environment.
The academic linkages of trade associations and the chambers of commerce have multiple dimensions. Several leading universities and academic institutions are working under the umbrellas of the chambers of commerce. The major policy research works of the US Chamber of Commerce are carried out in the world leading universities. Istanbul Chamber of commerce has founded the 'Istanbul Commerce University' in Turkey.
TOBB University of Economics and Technology has been founded by the Union of Chambers and Commodity Exchanges of Turkey (TOBB). In the present inclination of globalisation where the word 'countries' is being silently replaced by 'economies', the role of trade bodies has became more important. The policy advocacy, research and to work as a leading and supreme think tank should be the core activities of the national and multilateral chambers of commerce.
However, it is commonly observed that administrative and events management activities have become 'ultimate core responsibilities' of the national and multilateral chambers in the developing nations. The administrative activities, office management, record keeping, and events management are the supporting functions to lead the core activities.
To perform the contemporary functions the chambers in developing world do not have the required infrastructure. To achieve the real objectives, a complete restructuring in the national and regional chambers is required. These institutions will have to tap the new avenues to generate resources to finance their contemporary activities; they will have to redevelop their human resources, and they will have to amend their charters and the articles of association.
In the absences of the required infrastructures, the stereotypes activities will remain dominated in the chambers activities. Restructuring of the national and regional chambers is required to make them compatible with the world leading economic institutions not only in the language and terminology of policy dialogues but acquisition and utilisation of knowledge based resources.
It is extremely an important area for the institutions, which are involved in policy research and advocacy. To ignore the restructuring requirements may disassociate the national and regional chambers from the leading policy making institutions.
The incompatible structure and stereotypes activities may disintegrate the business community of a nation from the mainstream of global economic think tanks and policy-making institutions. The isolation from the mainstream of global economic think tanks and policy-making institutions will be a natural consequence of the ignorance of restructuring requirements.
The only common factor in the developing 5 nations who succeeded to join the G8 club is the close and continuous association of their private sector institutions with the developed nations in the business, technology and knowledge creative activities. Only national chambers can provide an environment to develop such associations.
(To be continued)