The present paper starts from the observation that there is still no analysis of private law as a basis for international trade, i. e. private transactions between noncompatriots (cf. Schmidt-Trenz 1990). Although authors like Buchanan, Hayek, Williamson, Bohm and Eucken have talked about the significance of a system of private law for the coordination of private transactions, they left out of their analysis the domain of protective state activity in international private business transactions vis-a-vis the multitude of legal orders and national enforcement organs. p ]It is the intention of this paper to focus upon the problems of the coordination of private foreign trade activities in the shadow of the territoriality of law. Specifically, it is asked: What are the causes for the fragmentation of private law in the world, and what are the consequences of the territoriality of law for the coordination of decisions concerning transactions between non-compatriots? The paper also deals with the question of how international coordination-efficiency can be fostered by international constitutional policy.

The division of labor is limited by the extent of the law

Economic development generally entails increasing interdependencethe emergence of a circular flow linking, directly or indirectly, each economic unit with others within a national economy. This process of integration is often viewed as a prerequisite or cause of sustained growth.' In striking contrast, the "Chinese development model" rests on a principle of self-sufficiency ("the reduction of specialization in the division of labor").2 During the Maoist era (1958-78), the central government of China promoted local self-reliance and the development of independent industrial systems; local authorities decried their dependence on inflows from other regions and announced their progress toward self-sufficiency in a wide variety of products. The extent to which the pattern of economic interaction in China has been consistent with the principle of self-sufficiency remains unclear. On the one hand, some observers accept that the Chinese economy is highly fragmented, with little cooperation among constituent units. Audrey Donnithorne, for example, has described the Chinese economy as "cellular," "composed of a myriad of small discrete units."3 Her analysis suggests that China is best conceptualized as a collection of essentially autarkic local economies rather than as a single national economy, the units of which could not have functioned more or less in the manner observed if deprived of opportunities to interact. On the other hand, some observers reject this fragnientation thesis, suggesting that an integrated national economy emerged, or was in the process of emerging, during the Maoist era. Nicholas Lardy, for example, has concluded that "economic growth since the decentralization [in 1957-58] has not been characterized by a strong pattern of regional self-sufficiency."4 It is necessary to resolve the puzzle posed by these contradictory

Interprovincial Trade and Development in China, 1957-1979

The Selectivity of Economic Integration Theories: A Comparison of Some Traditional and Marxist Approaches

The development of integration processes in international economic (and not only economic) life is a characteristic feature of the modern world. The concentration and internationalisation of production and the new require-ments of economic, scientific and technical progress add up to the objective basis for the emergence of integrating communities that differ from each other in socio-economic terms. These communities are an important factor in the world economy, notably in Europe. At the same time, a regional instead of a universal basis for integration may contain within itself definite contradictions, which come to the surface when an integrating community resorts to some form of collective protectionism.

Oleg T. Bogomolov

Papers

Integration by Market Forces and through Planning (Main Paper, Working Group I)