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This paper explores the emergence of direct linkages between the international economy and the state government of Baden-Württemberg, Germany. In the early 1990s Baden-Württemberg embarked on a plan in which the laender government took the lead in organizing a large-scale, high technology project for the development of interactive television. Creating a 'network' between itself and major economic actors the laender government sought to enhance the economic development of the region. However, as the economic actors involved in the project questioned the economic viability of interactive television, they began to withdraw from the project. The project's failure demonstrates the incompatibility of political objectives with the economic goals of actors in a globalized economy. We conclude that as attractive as the network approach may be for regional and national governments, it is likely to be successful only where both sets of actors see the outcome as enhancing their respective priorities (political legitimacy and economic gains). [ABSTRACT FROM AUTHOR]

The paper gives a brief overview of long wave analyses by embedding them into a general growth model of the Schumpeterian kind. A theory is presented which rests on price distortions in product and factor markets, and on the observation that institutional sluggishness prevents a society from reacting quickly to such distortions. This it is argued, breeds cycles of the Kondratieff type, Empirical evidence to support this theory is presented for Germany and for Argentina. [ABSTRACT FROM AUTHOR]