Abstract

Amidst the on-going US-China trade and technology war, as well as supply chain disruptions owing to the COVID-19 pandemic, issues of economic diversification and resilience have increasingly occupied policymakers and businesses alike. Yet despite the ascendance of these policy issues, identifying, measuring, and evaluating levels of economic risk, vulnerability, and inter-dependence to generate policy action is not always a straightforward and clear process. Moreover, although much has been written on economic inter-dependence, less is known about the vulnerabilities of the vast majority of countries. In other words, how might we measure and quantify economic dependency and vulnerability? How would we normatively evaluate these factors? Are certain countries more economically dependent and vulnerable than others? Similarly, how might we recognise appropriate diversity in risk-exposure? In this paper, we develop the indices of vulnerability and inter-dependence to address the aforementioned issues. As a quantitative gauge of levels of vulnerability and inter-dependence across countries, these indicators are intended to serve as instruments in the formulation of national economic policies and address concerns over economic security by enabling cross-country comparisons and the qualitative assessments of economic dependency and vulnerabilities.

About the Authors

Jikon Lai is Assistant Professor in the International Political Economy Programme of the S. Rajaratnam School of International Studies at Nanyang Technological University.

Jikon’s research interests lie at the intersection of international and comparative political economies, and international relations. His work examines how state, business and societal actors create, reproduce and sustain finance and the financial sector. He is animated by the desire to understand the interplay of domestic and international factors on financial systems.

Jikon’s research output has been published in Review of International Political Economy, New Political Economy, Journal of the Asia-Pacific Economy, Asia Europe Journal and the Australian Journal of Public Administration. He is also author of a book – Financial Crisis and Institutional Change in East Asia – published by Palgrave Macmillan in 2012. He also contributes to wider popular debate through various commentary pieces.

Amalina Anuar is a Research Analyst with the Centre for Multilateralism Studies (CMS) at the S. Rajaratnam School of International Studies (RSIS), Nanyang Technological University (NTU), Singapore. Prior to joining RSIS, she interned in the Foreign Policy and Security Studies Department at the Institute of Strategic and International Studies Malaysia and was a writer for publications such as the Asian Institute of Chartered Bankers’ Banking Insight magazine. Her research interests include the digital economy and trade, geopolitics and foreign policy developments; global and regional trade governance; as well as Malaysian economic foreign policy. Amalina possesses a BA from Monash University and completed her MSc in International Political Economy at RSIS.