Regional Economic Governance without institutionalization? Evidences from East Asia

n the regional study, the EU has been seen as the role model in terms of its degree of regionalisation and the process of its integration. In the literature of European integration, many scholarly works address the driving forces of the integration from different lens such as functionality, inter-governmental bargaining, diffusions and socialisation. Do these explanations hold true for the study on the other regions in the world? How can we better capture the regional integration in East Asia where the degree of economic development and interdepedence is high with low degree of regional institutionalisation? In this paper, we aim to study the decisions of regional integration from the bottom-up approach. Two East Asian countries, namely, Japan and Taiwan, are selected for comparison based on the most similar case criterion. In this paper, I aim to ascertain how East Asian states make their choices for regional economic integration. My special attention is paid to the diffusion effects and the state’s strategic choices. Following the rationales of rational-choice school, it is assumed that the attempts to further integrate into the region are strategically regardless of the different forms. I examine the diffusion effects and their impact on the two East Asian states, namely, Japan and Taiwan. The empirical evidences derived from our case studies of the origin of APEC, the initiative of Asia Monetary Fund (AMF) and the proliferations of Preferential Trade Agreements (PTAs). By tracing the process of the critical moments when the decisions were made in Japan and Taiwan, we find the different strategic moves are caused by different sources of diffusion at horizontal level. To conclude, the regional economic governance in East Asia can result from the strategic choice from the national level. The diffusion effects and historical legacy (ideational factor) also play a role in explaining the less institutionalized economic governance in East Asia.