Is Trade Policy for Sale? Congressional Voting on Recent Trade Bills

This paper examines voting by U.S. Representatives onthe North American Free Trade Agreement, the UruguayRound Agreement, and most-favored nation status forChina. Using recent political economy models of tradepolicy to formulate an empirical specification ofcongressional voting behavior, we find evidence thatcampaign contributions influenced legislators' voteson the NAFTA and Uruguay Round bills. Labor groupcontributions were associated with votes against freertrade while business contributions were associatedwith votes in favor of freer trade. Economicconditions in each member's district as well as thebroad policy views of the legislators also affectedrepresentatives' voting decisions.     

Gravitation or discrimination? Determinants of litigation in the World Trade Organisation

The strong presence of large countries in World Trade Organisation (WTO) dispute settlement and the absence of very poor ones have raised concerns that increasing legalisation in the global trading system has not diminished discrimination against less powerful countries as much as expected. This article examines dispute initiations in all WTO member state dyads in 1995–2003 to shed more light on this issue. The analysis suggests that the main driver of dispute initiation is a gravitational one: larger economies and bigger traders are more likely to become involved in trade disputes primarily because their economies are more diversified, and also because greater market size makes them more attractive targets of litigation. While evidence is not found for discriminatory effects against countries with small legal capacity, the results of the article point to a more complex form of power bias – namely a preponderance effect. They suggest that disputes among country dyads including a much more powerful defendant than complainant or vice versa are dealt with outside the WTO. This finding is potentially worrying because it is, arguably, easier to reduce legal capacity differences than to reduce power differences.     

Trade openness and public expenditure. The Spanish case, 1960–2000

The empirical link between the post-WWII expansion of international market integration and the growth of national public expenditure has been widely noted, with no consensus as yet regarding the interpretation of this correlation. We posit that a likely link between increased openness and public spending is the use of the latter to offset changes in the distribution of income that result from increased openness. To explore this potential link, we study time series data from Spain in 1960–2000, a period of major changes in political organization as well as in both fiscal and trade policy. We find evidence that democracy reinforced the causal relation from increased openness to greater public expenditure. Thus, the paper contributes to the literature that emphasizes that changes in political regimes are potentially important determinants of the observed international patterns of openness and government size.     

March divided,fight united? Trade union cohesion and government appeal for concertation

Why does the government appeal for concertation? Starting from the principal?agent framework and delegation theory, the article argues that the government is more willing to share decision-making power with trade unions when the policy preferences endorsed by the unions are closer to those of the cabinet. Furthermore, it maintains that government propensity to negotiate with trade unions increases as the heterogeneity of union policy preferences grows because the cabinet can exploit its agenda-setting power to divide the union front. The article tests these two hypotheses through a longitudinal analysis of the Italian case (1946–2014). In detail, it takes advantage of two original datasets built through content analysis that provide unique in-depth information on the policy preferences of parties and cabinets and measures the policy positions of the main Italian trade unions, thus allowing assessment of their reciprocal heterogeneity. The results confirm the expectations.     

Full circle? Ideas and ordeals of creating a Free Trade Area of the Asia-Pacific

Abstract

In 2004 and 2006, proposals were made at APEC summits to establish a Free Trade Area of the Asia-Pacific (FTAAP). This was an essentially a reworking of an idea first raised in the mid-1960s to create a Pacific Free Trade Area, or PAFTA. Although the PAFTA initiative never advanced, it helped lay the first organizational foundations for regional economic community building in the Asia-Pacific. The recent FTAAP proposal thus brings us full circle to the antecedent origins of APEC itself. If realized, an FTAAP would also create a free trade zone that would encircle the Pacific Rim economy and thereby subsume the region's now large number of bilateral and sub-regional free trade agreements (FTAs) into one unified agreement. Yet there are many inherent problems with establishing an FTAAP. These broadly relate to deconstructing the preferentialism of existing bilateral and sub-regional FTAs, achieving a consensus on the technical policy content and ideational principles on which an FTAAP would be based, and addressing various geopolitical issues such as reconciling the formation of a pan-regional Asia-Pacific FTA with an already fragile multilateral trading system. Growing interest in a ‘rival’ East Asia Free Trade Area project presents another geopolitical challenge. In considering these and other questions, it is concluded that many obstacles will remain in the path to realizing an FTAAP, and that this may not actually be a desirable objective to pursue for some time yet.     

Trade,export controls,and non‐proliferation in the Asia‐Pacific region

Abstract

Stemming the proliferation of weapons of mass destruction (WMD) — nuclear, biological, and chemical — and the missiles to deliver them comprises a crucial element in contemporary security policies. Many observers believe the utility of export controls in this effort is diminishing. While the authors believe that controls on the transfer of military and dual‐use items remain relatively effective and efficient compared to the alternative policy tools, they argue for the development of a more compelling rationale for export controls than restraining proliferation. The authors suggest that an emphasis on the links between non‐proliferation, regional stability, and economic prosperity could help policymakers transcend the more traditional view that such controls sacrifice economic gain for military security. Specifically, the authors argue that proliferation is bad for regional stability and regional economic growth, and that a prudent multilateral system of controls on dual‐use items establishes a foundation for both greater economic and security benefits.     

Who Preempted the Massachusetts Burma Law? Federalism and Political Accountability Under Global Trade Rules

With its "Burma law, " Massachusetts joined a procurement boycottof companies doing business in Burma. In Crosby v. NFTC, theU.S. Supreme Court held that Congress preempted the Massachusettslaw, even though Congress was silent on preemption. The Courtrelied on actions by executive-branch, foreign, and corporateactors to find that the state law was an obstacle to impliedobjectives of federal Burma sanctions. In doing so, the Courtdiffused congressional accountability for preemption and constrainedthe "constituent diplomacy" by which states and local governmentsuse their purchasing power to influence national policy andmultinational corporations. Crosby shifted the burden to Congressto express its intent not to preempt such measures. Congresshas several opportunities to meet this burden if it wants topreserve the diversity and balance that constituent diplomacybrings to the federal system.     

Trade union strategies and change in Neo-corporatist concertation: A new century of political exchange?

This article examines change and divergence in the politics of partnership-based governance of two weak neo-corporatist countries, Italy and Spain. Evolution in the forms and processes of concertation is driven by a logic of interaction guiding actors' behaviour which is different from that theorised for strongly neo-corporatist countries. As the framework governing the industrial relations system is characterised by conflict and poor coordination capacities, change will take the form of a top-down search for accommodation of this conflict through political exchange in contexts where neo-corporatist institutions provide weak constraints on actors' behaviour. This has been possible in the last decade because political participation, though weakly institutionalised, remained for trade unions a positive course of action used instrumentally in order to achieve policy and organisational benefits. Hence, the divergent evolutions of the two countries are to be traced back to factors affecting the strategic decision of political participation of trade unions, in particular inter-union ideological and political divisions and the dynamics of the relationship between grass roots and leadership.     

Trade and Industrial Policy as Levers for Sustainable Energy Technology Adoption? Experiences from Urban Latin America

Debates abound regarding the link between trade and industrial policy and the adoption of sustainable energy technologies in developing countries. Some purport that open trade regimes support technology diffusion, while others indicate that more interventionist regimes are more conducive. This paper uses empirical evidence from Mexico City and São Paulo to argue that sustainable energy technology uptake can be more prevalent in settings with partially open trade policy regimes. These regimes have afforded countries more opportunities to develop local capabilities, which, in turn, has had knock‐on effects on sustainable energy technology uptake. Specifically, having more local technology sources (equipment, expertise) brought quicker access to these technologies, created more perceptions of technology “ownership,” fostered more effective mobilization, and helped create well‐established standards, which in turn contributed positively to sustainable energy technology uptake, while taxes and tariffs were less influential.     

Order and democracy: Trade‐offs between social control and civil liberties at Lake Parc Place

Abstract

This article applies the classic theories of Thomas Hobbes and John Stuart Mill to the issue of maintaining order, using Chicago's Lake Parc Place public housing project as a case study. I find that public housing residents living in frightening circumstances may be willing to give up some liberties to gain stability and order, but that very order can in turn provide them with the civil space necessary for them to become active participants in their own governance. While Lake Parc Place residents willingly submitted to strict rules to secure a sense of safety, as Hobbes would suggest, once order was established they chose Mill's path, becoming involved in managing their own community. Thus, policies restricting liberties to increase safety have the potential to increase civic participation.     

The Politics of Foreign Direct Investment into Developing Countries: Increasing FDI through International Trade Agreements?

The flow of foreign direct investment into developing countries varies greatly across countries and over time. The political factors that affect these flows are not well understood. Focusing on the relationship between trade and investment, we argue that international trade agreements—GATT/WTO and preferential trade agreements (PTAs)—provide mechanisms for making commitments to foreign investors about the treatment of their assets, thus reassuring investors and increasing investment. These international commitments are more credible than domestic policy choices, because reneging on them is more costly. Statistical analyses for 122 developing countries from 1970 to 2000 support this argument. Developing countries that belong to the WTO and participate in more PTAs experience greater FDI inflows than otherwise, controlling for many factors including domestic policy preferences and taking into account possible endogeneity. Joining international trade agreements allows developing countries to attract more FDI and thus increase economic growth.     

Can China’s Economic Statecraft Win Soft Power in Africa? Unpacking Trade,Investment and Aid

Boosting China’s soft power is an important goal of Chinese economic statecraft in Africa. However, African opinions of China – in particular those of ordinary people – are understudied, and existing evidence suggests African viewpoints on China are highly varied and polarized. On the one hand, China’s growing economic linkages are welcomed by Africans as an important alternative to traditional partners, and a vital source of funding for development needs. On the other hand, Africans see China as a source of poor-quality products and an exploitative threat to local markets. How can scholars understand these polarized opinions on China? Using data from the Afrobarometer Round 6 survey (2016), this article aims to untangle African perceptions of Chinese economic engagement through unpacking the distinctive effects of China’s three tools of economic statecraft: trade, foreign direct investment, and aid. Analyses of Chinese influence frequently package these three modes of engagement together, but in practice they have very different consequences for China’s soft power. Negative perceptions of China among African citizens are primarily associated with trade-related issues. China’s investment and aid, on the other hand, generally make a positive contribution to Chinese soft power in Africa. By highlighting the contrasting effects of different instruments of economic engagement, this analysis contributes insight into Sino-African relations and China’s wider economic diplomacy.

     

What News on the Rialto? The Trade of Information and Early Modern Venice’s Centralized Intelligence Organization

This article explores one of the earliest centrally organized state intelligence services in world history. Contrary to the orthodoxy that sees systematized intelligence as a modern political phenomenon, this was developed in early modern Venice. The article reveals the complex organization of Venetian systemized intelligence that distinguished it from other contemporaneous states’ espionage networks. It also shows how Venetian authorities commodified intelligence by engaging citizens and subjects in a trade of information for mutual benefits. Ultimately, the article challenges our understanding of early modern political communication and offers a fresh vista of intelligence as a business trait and economic necessity.     

Upgrading the ‘software’: The EU–Korea Free Trade Agreement and sociocultural barriers to trade and investment

Abstract

In October 2010, the European Union (EU) and the Republic of Korea signed a free trade agreement that went into effect in July 2011 and aims to increase levels of bilateral trade and investment by dismantling existing tariff and non-tariff barriers. In this article, we highlight the importance of a third class of barriers: social, cultural and institutional barriers to trade with and investment in Korea that cannot be legislated for under the new agreement but that can serve as ‘hidden stumbling blocks’ to its implementation and effectiveness. We argue that the phenomenon of ‘mismatched globalization’ (in which economic globalization outpaces cultural globalization) is still apparent in Korea, as evidenced by the continuing existence of these ‘soft’ barriers which include, inter alia, the gap between policy and implementation; the lack of predictability, consistency and transparency in the regulatory environment (including IPR protection); education systems; labour militancy; and attitudes towards globalization. These findings resonate with Dent's (2006 Dent, C. M. 2006. New Free Trade Agreements in the Asia-Pacific, Basingstoke: Palgrave Macmillan. [Crossref] , [Google Scholar]) argument that ‘deficient capacity’ in terms of technocracy, industry and/or institutional arrangements can pose problems for developing countries seeking to negotiate and implement bilateral trade agreements with more developed countries. In the case of Korea, the long-term ‘soft’ social, cultural and institutional barriers identified and discussed in this article act as a constraint on the country's institutional capacity functions and thus have the potential to hinder the full and effective implementation of the EU–Korea Free Trade Agreement and reduce the economic benefits that the signatory parties hope to gain from it.     

A European “Equivalent” to United States Export Controls: European Law on the Control of International Trade in Dual-Use Space Technologies

This article analyzes the system developed within Europe, more precisely within the European Union through European Community law, to address the security-sensitive issues involved in the export of hardware, software, and knowledge for the purpose of space activities and major space applications. The subject is introduced with reference to the far better known export control developments within the United States, such as those concerning International Traffic in Arms Regulations, and the international understandings under the Missile Technology Control Regime and Wassenaar Arrangement. European Community Regulations for export controls provide for a complex system of balances between national sovereignty and Europe-wide harmonization. This European Community regime, though ultimately still dependent upon individual state's sovereign controls, establishes an interesting measure of international harmonization in security-sensitive export controls. Although the European Community regime is fraught with many complexities, it manages to avoid some of the pitfalls evident in the United States and international regimes, notably the confusing discussions on discerning weaponry proper from other space items with dual-use potential. This is the result mainly of an approach characterized by a primary intention to harmonize, rather than to apply strict controls per se, resulting in a transparency and consistency that are not only valuable to commercial entrepreneurs, but also to those concerned primarily with the security risks posed by the international space industry. As for the space industry in particular, it is helpful that the European Community regime specifically carves out civil space activities, for example if conducted within the context of the European Space Agency or national space agency activities.     

Making the grade: infrastructural semiotics and derivative market outcomes on the Chicago Board of Trade and New Orleans Cotton Exchange, 1856–1909

This paper contributes to a socio-technical analysis of derivatives by offering an infrastructural explanation of divergent outcomes on two early American futures markets. It takes as the starting-point of analysis the classification systems by which these futures markets were constitutively linked to underlying markets in agricultural commodities. Despite the formal similarity of these systems, their contrasting implementation – i.e. how grading was accomplished and integrated into practice – produced classifications with dissimilar semiotic qualities. This semiotic distinction is shown to have promoted divergent economic behaviours and outcomes on the two markets: high-risk speculation and volatility on the Chicago Board of Trade, low-risk hedging and stability on the New Orleans Cotton Exchange. The paper thus argues that treating classifications in their semiotic capacity yields an analysis that can connect foundational infrastructures and market-level outcomes in meaningful, non-deterministic ways.