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International trade
This volume provides a brief introduction to the study of international trade and economics.
Book
Forced to Be Good
Preferential trade agreements have become common ways to protect or restrict access to national markets in products and services. The United States has signed trade agreements with almost two dozen countries as close as Mexico and Canada and as distant as Morocco and Australia. The European Union has done the same. In addition to addressing economic issues, these agreements also regulate the protection of human rights. InForced to Be Good, Emilie M. Hafner-Burton tells the story of the politics of such agreements and of the ways in which governments pursue market integration policies that advance their own political interests, including human rights.
How and why do global norms for social justice become international regulations linked to seemingly unrelated issues, such as trade? Hafner-Burton finds that the process has been unconventional. Efforts by human rights advocates and labor unions to spread human rights ideals, for example, do not explain why American and European governments employ preferential trade agreements to protect human rights. Instead, most of the regulations protecting human rights are codified in global moral principles and laws only because they serve policymakers' interests in accumulating power or resources or solving other problems. Otherwise, demands by moral advocates are tossed aside. And, as Hafner-Burton shows, even the inclusion of human rights protections in trade agreements is no guarantee of real change, because many of the governments that sign on to fair trade regulations oppose such protections and do not intend to force their implementation.
Ultimately, Hafner-Burton finds that, despite the difficulty of enforcing good regulations and the less-than-noble motives for including them, trade agreements that include human rights provisions have made a positive difference in the lives of some of the people they are intended-on paper, at least-to protect.
eBook
Is the WTO Passé?
The WTO has delivered policy outcomes that are very different from those likely to emerge out of the recent wave of preferential trade agreements (PTAs). Should economists see this as an efficient institutional hand-off, where the WTO has carried trade liberalization as far as it can manage, and is now passing the baton to PTAs to finish the job? We survey a growing economics literature on international trade agreements and argue on this basis that the WTO is not passé. Rather, and subject to some caveats, our survey of research to date suggests that the WTO warrants strong support while a more cautious view of PTAs seems appropriate.
Journal Article
Domestic Value Added in Exports: Theory and Firm Evidence from China
China has defied the declining trend in domestic content in exports in many countries. This paper studies China's rising domestic content in exports using firm- and customs transaction-level data. The approach embraces firm heterogeneity and hence reduces aggregation bias. The study finds that the substitution of domestic for imported materials by individual processing exporters caused China's domestic content in exports to increase from 65 to 70 percent in the period 2000-2007. Such substitution was induced by the country's trade and investment liberalization, which deepened its engagement in global value chains and led to a greater variety of domestic materials becoming available at lower prices.
Journal Article
The Surprisingly Swift Decline of US Manufacturing Employment
This paper links the sharp drop in US manufacturing employment after 2000 to a change in US trade policy that eliminated potential tariff increases on Chinese imports. Industries more exposed to the change experience greater employment loss, increased imports from China, and higher entry by US importers and foreign-owned Chinese exporters. At the plant level, shifts toward less labor-intensive production and exposure to the policy via input-output linkages also contribute to the decline in employment. Results are robust to other potential explanations of employment loss, and there is no similar reaction in the European Union, where policy did not change.
Journal Article
Economic Sanctions
Taking an interdisciplinary perspective, we examine the evolution of economic sanctions in the post-World War II era and reflect on the lessons that could be drawn from their features and patterns of use. We observe that, during this time, there has been a remarkable increase in the use of sanctions as an instrument of foreign policy. We classify this period into four 'eras' and discuss, in this context, how the evolution of sanctions may be linked to salient features of the contemporaneous international political and economic orders. Our review of the related literatures in economics and political science suggests, among other things, that our understanding of sanction processes could be significantly advanced by marrying these perspectives. We conclude by identifying several questions and challenges, and by discussing how interdisciplinary research could address them.
Journal Article