The Invisible Hand Economic Intelligence And Industrial Espionage

By Davis Truman

"The Invisible Hand" delves deep into the clandestine world of economic intelligence and industrial espionage, where the forces shaping global economies are often unseen and unknown.

In this riveting exploration, author Davis Truman unveils the intricate web of intrigue that underpins modern capitalism. From covert operations to sophisticated cyber-espionage, this book reveals how nations and corporations deploy their resources relentlessly for competitive advantage.

Drawing from real-life examples and historical case studies, "The Invisible Hand" exposes the shadowy tactics governments and businesses use to gain insight into their rivals' strategies, steal trade secrets, and manipulate markets.

• Language: English
• Publisher: vincenzo nappi
• Release date: Mar 4, 2024
• ISBN: 9798224584246

Book preview

Chapter One

Introduction

THE CURRENT INTERNATIONAL scenario has continuously been reshaped by the interplay of several factors, giving rise to new challenges for all the global players and widening the spectrum of actors involved in the international stage. The end of the Cold War represented a geopolitical watershed; economic competition gained momentum, and states resorted to new strategies to fit in the global arena. Globalization significantly impacted international politics, leading to a growing interdependence among global actors, thus representing a paradigm shift from the traditional Westphalian system; the economic dimension arose as the dominant vector of international relations. Indeed, competition between states shifted from the military to the economic field, financial instruments replaced military weaponry, and the battlefield moved towards market competition. The growing importance of the economic dimension urged global actors to adapt new strategies to be competitive in the international scenario. Economic security gradually pervaded the political agenda of world countries, becoming a top priority.

States needed to resort to new strategic tools to meet the dynamic features of economic competition to protect and boost the competitiveness of national companies and the armies of economic warfare. National security and economic security became gradually two intertwined concepts, significantly impacting the worldwide security culture, traditionally oriented towards a military dimension. World powers gradually acknowledged that economic and informational asymmetries catalyzed national security challenges, urging states to resort to new strategic tools to be competitive in economic warfare, as it became the new face of a war of the 21st century. In this regard, economic intelligence gained a crucial role in the geo-economic scenario, becoming essential for global players to protect national assets and make national companies competitive internationally. The growing worldwide impact of economic intelligence communities was dictated by the strategic role that the information domain acquired in economic warfare. Indeed, the increasing interconnections and interdependence among world actors significantly impacted communication, resulting in an overflow of information.

For this reason, accurate information management has become a conditio sine qua non for nowadays security strategies, considerably impacting countries’ economic competitiveness. Economic intelligence sheds light on the strategic essence of information to the extent that it concerns any activities aimed at gathering information to protect countries’ economic and industrial interests, thus oriented to safeguard economic security. Thus, Economic intelligence became an essential tool for states and companies to be competitive in economic warfare, encompassing a variety of activities that rely on defensive and offensive strategies that contribute to safeguarding national interest. Indeed, although interdependence has increased the quantity and the quality of interconnections among global actors, thanks to the development of new technologies, it also opened the way to an increase of foreign threats due to the security gaps of communication flows, in which espionage activities and cyber-attacks have increased the likelihood of targeting a wide variety of actors.

Chapter Two

Geo-economics and financial warfare

THE INTERNATIONAL SCENARIO has faced several security challenges in the last decades. States have been politically and economically involved in tackling these issues to safeguard their status or exert their influence over their borders. Tracing back to the previous century, world countries often resorted to military power to safeguard their interests and to protect their resources, struggling to build the most efficient weaponry to pursue strategic aims, increase, as well, their international status, and enhance the prestige of the state. During the Cold War era, the wounds of past conflicts were still bleeding in the collective imaginary, leading states to refrain from using military power and creating the United Nations to promote peace among its member states. In parallel with this trend, economic competition arose as the dominant driver of international politics, affecting states’ domestic and foreign policies and urging world powers to settle the most favorable conditions to meet the market's needs and keep pace with the evolution of the world economy. Globalization's impact in shaping international relations is worth mentioning, leading to a growing interdependence of world economies. Indeed, globalization has always been controversial among the walls of academia, both for the dimensions it encompasses and for the several interpretations given by scholars that gave rise to a massive debate around this issue. For this reason, a wide range of theories were formulated to describe this phenomenon, trying to conceptualize the growing interdependence between all the actors that compose the global scenario, going beyond the state-centric framework rooted in the Westphalian system of 1648.

Indeed, a vast set of definitions of the issue have been theorized since the late 60s, emphasizing the creation of networks between the players located in every corner of the planet, along with the interpretations given by the international relations theories, focusing on the role of the market, as shown by the liberalist point of view or analyzed using the consolidation of U.S. power by the realist point of view. Indeed, in the aftermath of World War II, the Bretton Woods Agreements of 1944 set the new rules of the post-war economic regime, establishing the institution of the International Monetary Fund and the Bank for Reconstruction and Development, which later became the World Bank, and enacting a new set of trade agreements, and at the same time focusing on the reconstruction of Europe, with the deployment of Marshall Plan. The breakdown of the international financial system showed how the market economy needed tight controls to avoid a return to the beggar thy neighbor policies. Stability was the leading concern of developed countries that put their efforts into granting economic growth and keeping the other currencies pegged to the dollar's value. At the same time, the latter was fixed to gold at US$ 35 per ounce.

Furthermore, world powers witnessed how the inter-war years jeopardized the economic system, as argued by the United States Secretary of State Cordel Hull, who analyzed how the presence of protectionist barriers and tariffs was a catalyst of the likelihood of war by eliminating the economic dissatisfaction that breeds war, it could be possible to reach a long-lasting peace. This system collapsed in the 70s, more precisely in 1971, when U.S. President Richard Nixon announced the suspension of the dollar’s convertibility into gold, the so-called Nixon shock, abandoning the fixed exchange rate system and leaving the floor to the current system of floating exchange rates. Nevertheless, most of the world's economies were in the throes of a severe economic crisis, leading to the abandonment of