1-9 of 9 Results

  • Keywords: World Trade Organizations x
Clear all

Article

Mostafa Beshkar and Eric Bond

International trade agreements have played a significant role in the reduction of trade barriers that has taken place since the end of World War II. One objective of the theoretical literature on trade agreements is to address the question of why bilateral and multilateral trade agreements, rather than simple unilateral actions by individual countries, have been required to reduce trade barriers. The predominant explanation has been the terms of trade theory, which argues that unilateral tariff policies lead to a prisoner’s dilemma due to the negative effect of a country’s tariffs on its trading partners. Reciprocal tariff reductions through a trade agreement are required to obtain tariff reductions that improve on the noncooperative equilibrium. An alternative explanation, the commitment theory of trade agreements, focuses on the use of external enforcement under a trade agreement to discipline domestic politics. A second objective of the theoretical literature has been to understand the design of trade agreements. Insights from contract theory are used to study various flexibility mechanisms that are embodied in trade agreements. These mechanisms include contingent protection measures such as safeguards and antidumping, and unilateral flexibility through tariff overhang. The literature also addresses the enforcement of agreements in the absence of an external enforcement mechanism. The theories of the dispute settlement process of the WTO portray it as an institution with an informational role that facilitates the coordination among parties with incomplete information about the states of the world and the nature of the actions taken by each signatory. Finally, the literature examines whether the ability to form preferential trade agreements serves as a stumbling block or a building block to multilateral liberalization.

Article

Trade governance rests upon certain economic assumptions and the ensuing political compromises made possible by the growth of an incremental legal consensus. The main economic assumptions are that trade will deliver upon the objectives of socio-economic development, stable, long-term employment opportunities and poverty reduction. These assumptions are theoretically sound, but are increasingly challenged by the complex political realities of global trade. The study of trade in the field of international political economy (IPE) has deep roots in the postwar disciplines of economics and political science. The literature on the history of trade regulation places the current system, with its emphasis on the legitimizing imprimatur of political power and the significance of binding treaty, into a more nuanced context in which present practices, while sometimes novel, are frequently older than most policy makers realize. In the two decades since the finalization of the Uruguay Round and the creation of the World Trade Organization (WTO), a host of significant issues have arisen as scholars and policy makers attempt to implement the WTO’s mandate and navigate the political waters of trade regulation as it relates to domestic law and policy. These include the set of issues raised by the broadening of trade regulation post-Uruguay Round to include trade related intellectual property rights and trade in services, the contentious issue of trade and economic development, and the issue of WTO reform.

Article

In a time of trade wars, free trade skepticism, tech rivalry, and multipolar disorder, the European Union (EU) cannot evade its responsibilities the last defender of the World Trade Organization (WTO). Yet, it raises the question of whether the EU has power to defend the WTO. The EU is a multilateralist-oriented power of global magnitude. Unlike the United States, the EU is openly defending the WTO in the current crisis created by continued refusal to appointment WTO Appellate Body members. Like the United States, the EU is concerned with the illegitimate trade practices of China. Yet, the EU uses diplomatic pressure on China within the rules of the WTO. The EU is actively trying to rescue the rule-based trade system. Yet, it cannot do so alone. It needs support, not just form other WTO members but also from within Europe itself. The current crisis is in part rooted in the inability of the WTO members to update the WTO rulebook. The focus will be on the potential clash between a more assertive EU on sustainability and the absence of updated WTO rules on sustainable trade issues. This may force the EU to confront a deep-rooted policy dilemma. The question is whether the EU should continue to refrain from using its market power to promote sustainable trade in respect of the WTO. As the EU is about to ratify several bilateral trade agreements of commercial, geo-economic, and indeed geo-political importance, such as the EU–Mercosur or EU–Vietnam agreements, the rule-orientation of the EU faces growing domestic opposition as well as external contestation. Furthermore, the EU is modernizing its trade defense weaponry, the antidumping instrument, and has recently declared its intent to impose unilateral climate-related trade policy measures, the carbon-adjustment tariff, in the future. Thus, an incident such as the burning of the Amazon forest may force the EU to take a tougher stance on sustainability at the risk of bringing the EU on a collision course with the WTO itself, its rules, process, and member states. Consequently, the complex setup of the EU as a trade power could make it difficult to ratify WTO-compatible trade agreements in the future.

Article

In a comparison of today’s global political economy with that of the last great era of globalization, the late nineteenth century, the most prominent distinction is be the high degree of institutionalization in today’s system. While the nineteenth-century system did have some important international institutions—in particular the gold standard and an emerging network of trade agreements—it had nothing like the scope and depth of today’s powerful international economic institutions. We cannot understand the functioning of today’s global political economy without understanding the sources and consequences of these institutions. Why were international organizations (IOs) such as the World Trade Organization (WTO) or International Monetary Fund (IMF) created? How have they gained so much influence? What difference do they make for the functioning of the global economy and the well-being of individuals around the world? In large part, understanding IOs requires a focus on the tension between the use of power, and rules that are intended to constrain the use of power. IOs are rules-based creatures. They create and embody rules for gaining membership, for how members should behave, for monitoring, for punishment if members renege on their commitments, etc. However, these rules-based bodies exist in the anarchical international system, in which there is no authority above states, and states continue to exercise power when it is in their self-interest to do so. While states create and join IOs in order to make behavior more rule-bound and predictable, the rules themselves reflect the global distribution of power at the time of their creation; and they only constrain to the extent that states find that the benefits of constraint exceed the costs of the loss of autonomy. The tension between rules and power shapes the ways in which international institutions function, and therefore the impact that they have on the global economy. For all their faults, international economic institutions have proven themselves to be an indispensable part of the modern global political economy, and their study represents an especially vibrant research agenda.

Article

Kerry A. Chase

Government policies to protect and promote national culture are a perennial issue in the trading system. Controversy over trade and culture, in almost every instance, swirls around entertainment media—mainly movies, television, video, and music. The object of contention is that many states employ an assortment of financial, trade, and regulatory measures to subsidize locally produced entertainment, restrict imports, and favor national content over foreign content. Such measures often impede trade, pitting commercial interests in open markets and free choice against calls for state action to mitigate trade’s social repercussions. Differing perspectives on the motives behind these policies typify disputes over trade and culture. In one view, state regulation of entertainment media is cultural policy, an essential means of preserving a nation’s identity, culture, and way of life. From another vantage point, these policies are backdoor protectionism, a handout to local business and labor under the guise of cultural preservation. The problem of trade and culture therefore raises basic questions about politics: Why do states subsidize production and restrict imports? What drives political demands for trade protection and government aid? How can variation in policy responses be understood? In the World Trade Organization (WTO), disputes over trade and culture center on two related issues. The first is inclusion of a “cultural exception” in trade rules to green-light, on cultural grounds, state actions that interfere with trade in entertainment media. Although there is no cultural exception in the WTO, pressure to accommodate the “specificity” of entertainment media as a cultural phenomenon has complicated trade negotiations and at times required give and take to placate the opposing sides. The second issue is policy liberalization in entertainment media, which has lagged behind market opening in many other goods and services. Deadlock over trade and culture has inspired some WTO members to explore other options: the European Union (EU) and Canada spearheaded the push for a Convention on Cultural Diversity, and the United States has pursued policy liberalization in a series of free trade agreements. Important political questions again crop up: Why has culture stalemated the WTO, and why haven’t trade linkages like those for health safety standards been institutionalized for trade and culture? Why do international political alignments on this problem form as they do? What explains the design of trade rules for entertainment media, and what is the trade regime’s impact on state policy? The age-old conflict over trade and culture continues to play out and shows no signs of abating.

Article

The World Trade Organization (WTO) dispute settlement system is its judicial arm and enforcement mechanism, designed to assist members in resolving trade disputes that arise between them. Its design reflects a move toward greater legalization in trade governance under the multilateral trade regime. Compared with the dispute settlement system of its predecessor, the General Agreement on Tariffs and Trade (GATT), the WTO’s dispute settlement provided a more structured and formal process with clearly defined stages and more discipline in the timetable of the dispute so as to resolve trade disputes as efficiently as possible. Most important, the WTO’s dispute settlement provides for virtually automatic adoption of panel rulings: a respondent losing a case can block the adoption only if it can persuade all members of the WTO not to do so. The legal basis for the WTO’s dispute settlement system is the Dispute Settlement Understanding (DSU), which provides the principles and procedures by which members may bring their trade disputes to the multilateral trade regime for resolution. Overseeing the dispute settlement process is the Dispute Settlement Body (DSB), which consists of all WTO members and meets regularly to receive and to adopt reports of disputes at their various stages of progress. How effective is the WTO’s dispute settlement mechanism? Effectiveness can be conceptualized as success in attaining the objectives of the dispute settlement under the WTO in three areas: the efficiency of dispute settlement; inclusiveness of the dispute settlement process, especially as it concerns developing country participation; and compliance with legal obligations resulting from arbitration. The existing scholarship on this topic features key debates and frontiers for future research on firms and global production networks/value chains that have the potential to advance our state of knowledge concerning this “crown jewel” of the multilateral trade regime.

Article

Neoliberalism refers to a set of market-based ideas and policies ranging from government budget cuts and privatization of state enterprises to liberalization of currency controls, higher interest rates and deregulation of local finance, removal of import barriers (trade tariffs and quotas), and an emphasis on promotion of exports. While the effects of these policies have been quite consistent, they have sparked sharp criticism from the left. Critics pointed out the elites’ consistent failure in areas such as development aid, international financial regulation, Bretton Woods reform, the World Trade Organization’s Doha Agenda, and United Nations Security Council democratization. In the wake of the financial crisis of 2007–2008, the G20 held a summit in 2009 to discuss policy issues pertaining to the promotion of international financial stability. G20 leaders vowed to, among other promises, strengthen the longer term relevance, effectiveness and legitimacy of the International Monetary Fund and the World Bank, and to seek agreement on a post–2012 climate change regime. However, many intellectual critics of neoliberalism insisted that the G20 represented nothing new. Instead, they emphasize several urgent political priorities, such as: immediately recall and reorganize campaigning associated with defense against financial degradation; reconsider national state powers including exchange controls, defaults on unrepayble debts, financial nationalization and environmental reregulation, and the deglobalization/decommodification strategy for basic needs goods; and address the climate crisis by rejecting neoliberal strategies in favor of both consumption shifts and supply-side solutions.

Article

Elizabeth McKillen

American workers have often been characterized by the press, scholars, and policy-makers as apathetic and ill-informed about foreign policy issues. To highlight this point, scholars have frequently used an anecdote about a blue-collar worker who responded to an interviewer’s questions regarding international issues in the 1940s by exclaiming “Foreign Affairs! That’s for people who don’t have to work for a living.” Yet missing from many such appraisals is a consideration of the long history of efforts by both informal groups of workers and labor unions to articulate and defend the perceived international interests of American workers. During the early years of the American Republic, groups of workers used crowd actions, boycotts, and protests to make their views on important foreign policy issues known. In the late 19th century, emerging national labor unions experimented with interest group lobbying as well as forms of collective action championed by the international labor movement to promote working-class foreign policy interests. Many 20th- and 21st-century US labor groups shared in common a belief that government leaders failed to adequately understand the international concerns and perspectives of workers. Yet such groups often pursued different types of foreign policy influence. Some dominant labor organizations, such as the American Federation of Labor (AFL) and Congress of Industrial Organizations (CIO), participated in federal bureaucracies, advisory councils, and diplomatic missions and programs designed to encourage collaboration among business, state, and labor leaders in formulating and promoting US foreign policy. Yet other labor groups, as well as dissidents within the AFL and CIO, argued that these power-sharing arrangements compromised labor’s independence and led some trade union leaders to support policies that actually hurt both American and foreign workers. Particularly important in fueling internal opposition to AFL-CIO foreign policies were immigrant workers and those with specific ethno-racial concerns. Some dissenting groups and activists participated in traditional forms of interest group lobbying in order to promote an independent international agenda for labor; others committed themselves to the foreign policy programs of socialist, labor, or communist parties. Still others, such as the Industrial Workers of the World, advocated strike and international economic actions by workers to influence US foreign policy or to oppose US business activities abroad.

Article

The Special Relationship is a term used to describe the close relations between the United States and the United Kingdom. It applies particularly to the governmental realms of foreign, defense, security, and intelligence policy, but it also captures a broader sense that both public and private relations between the United States and Britain are particularly deep and close. The Special Relationship is thus a term for a reality that came into being over time as the result of political leadership as well as ideas and events outside the formal arena of politics. After the political break of the American Revolution and in spite of sporadic cooperation in the 19th century, it was not until the Great Rapprochement of the 1890s that the idea that Britain and the United States had a special kind of relationship took hold. This decade, in turn, created the basis for the Special Relationship, a term first used by Winston Churchill in 1944. Churchill did the most to build the relationship, convinced as he was that close friendship between Britain and the United States was the cornerstone of world peace and prosperity. During and after the Second World War, many others on both sides of the Atlantic came to agree with Churchill. The post-1945 era witnessed a flowering of the relationship, which was cemented—not without many controversies and crises—by the emerging Cold War against the Soviet Union. After the end of the Cold War in 1989, the relationship remained close, though it was severely tested by further security crises, Britain’s declining defense spending, the evolving implications of Britain’s membership in the European Union, the relative decline of Europe, and an increasing U.S. interest in Asia. Yet on many public and private levels, relations between the United States and Britain continue to be particularly deep, and thus the Special Relationship endures.