State Control and the Effects of Foreign Relations on Bilateral Trade

Do states use trade to reward and punish partners? WTO rules and the pressures of globalization restrict states’ capacity to manipulate trade policies, but we argue that governments can link political goals with economic outcomes using less direct avenues of influence over firm behavior. Where governments intervene in markets, politicization of trade is likely to occur. In this paper, we examine one important form of government control: state ownership of firms. Taking China and India as examples, we use bilateral trade data by firm ownership type, as well as measures of bilateral political relations based on diplomatic events and UN voting to estimate the effect of political relations on import and export flows. Our results support the hypothesis that imports controlled by state-owned enterprises (SOEs) exhibit stronger responsiveness to political relations than imports controlled by private enterprises. A more nuanced picture emerges for exports; while India’s exports through SOEs are more responsive to political tensions than its flows through private entities, the opposite is true for China. This research holds broader implications for how we should think about the relationship between political and economic relations going forward, especially as a number of countries with partially state-controlled economies gain strength in the global economy

Unordnung in der internationalen Handelsordnung: Befunde, Gründe, Auswirkungen und Therapien

In the past, many WTO member states have liberalized their trade policies unilaterally. However, they were decreasingly prepared to guarantee these measures multilaterally, that is to "bind" themselves. This paper analyzes the background of this development by resorting to three political economy arguments pro multilateral binding: the terms of trade externality argument, the "tying hand" argument, that is to protect a government which is prone to liberalize against domestic lobby groups, and finally the argument that trade policies are instruments for general political targets. For all three arguments, it is shown why an important driving force of mercantilistically motivated trade negotiations has become weaker: the reciprocity requirement. The paper recommends narrower negotiation issues and mandates to prevent a further rising heterogeneity of issues and negotiation partners. Copyright 2010 die Autoren Journal compilation 2010, Verein für Socialpolitik und Blackwell Publishing Ltd.

Not So Radical Historicism

Mark Bevir raises the question of how genealogy, understood as a technique-based radical historicism, and the notion of the contingency of ideas, ground “critique.” His problem is to avoid the relativism of radical historicism in a way that allows for “critique” without appealing to non-radical historicist absolutisms of the kind that ground the notion of false consciousness. He does so by appealing to the notion of motivated irrationality, which he claims avoids the problem of relativism and the problems of “false consciousness.” The genealogies of Nietzsche and Foucault, however, do not ground “critique.” The relevant normative judgments, of nobility in Nietzsche, for example, are presupposed

Using Game Theory to Link Domestic and International Politics

Peer Reviewedhttp://deepblue.lib.umich.edu/bitstream/2027.42/67199/2/10.1177_0022002797041001001.pd