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"Trade negotiation"
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A “New Trade” Theory of GATT/WTO Negotiations
I suggest a novel theory of GATT/WTO negotiations based on Krugman’s “new trade” model. It emphasizes international production relocations and is easy to calibrate to bilateral trade data. Focusing on the major players in recent GATT/WTO negotiations, I find that it implies reasonable noncooperative tariffs as well as moderate gains from GATT/WTO negotiations.
Journal Article
The Philippines and the International Monetary Fund negotiations on petroleum and imports : toward a theory of negotiation
\"Examines the Philippine-International Monetary Fund negotiations on petroleum and imports from 1984 to 1994. It develops a midrange theory with which to examine country-IMF negotiations\"-- Provided by publisher.
Book
What Do Trade Negotiators Negotiate About? Empirical Evidence from the World Trade Organization
According to the terms-of-trade theory, governments use trade agreements to escape from a terms-of-trade-driven prisoner's dilemma. We use the terms-of-trade theory to develop a relationship that predicts negotiated tariff levels on the basis of pre-negotiation data: tariffs, import volumes and prices, and trade elasticities. We then confront this predicted relationship with data on the outcomes of tariff negotiations associated with the accession of new members to the World Trade Organization. We find strong and robust support for the central predictions of the terms-of-trade theory in the observed pattern of negotiated tariff cuts.
Journal Article
DO TERMS-OF-TRADE EFFECTS MATTER FOR TRADE AGREEMENTS? THEORY AND EVIDENCE FROM WTO COUNTRIES
International trade agreements are an important element of the world economic system, but questions remain as to their purpose. The terms-of-trade hypothesis posits that countries use tariffs in part to improve their terms of trade and that trade agreements cause them to internalize the costs that such terms-of-trade shifts impose on other countries. This article investigates whether the most-favored-nation (MFN) tariffs set by World Trade Organization (WTO) members in the Uruguay Round are consistent with the terms-of-trade hypothesis. We present a model of multilateral trade negotiations featuring endogenous participation that leads the resulting tariff schedules to display terms-of-trade effects. Specifically, the model predicts that the level of the importer’s tariff resulting from negotiations should be negatively related to the product of two terms: exporter concentration, as measured by the Herfindahl-Hirschman index (sum of squared export shares), and the importer’s market power, as measured by the inverse elasticity of export supply, on a product-by-product basis. We test this hypothesis using data on tariffs, trade, and production across more than 30 WTO countries and find strong support. We estimate that the internalization of terms of trade effects through WTO negotiations has lowered the average tariff of these countries by 22% to 27% compared to its noncooperative level.
Journal Article
Not your parents' trade politics: the Transatlantic Trade and Investment Partnership negotiations
The Transatlantic Trade and Investment Partnership (TTIP) negotiations aspire to create the world's most ambitious trade agreement between the world's two largest economies. The politics associated with TTIP are different from those associated with previous trade negotiations. Moreover, they diverge from the prevailing International Political Economy (IPE) account of trade policy. The politics of TTIP diverge from the conventional IPE account of trade politics in two particularly noteworthy ways. First, rather than being rivals, American and European business interests are allies, adopting common positions on what they want the agreement to look like. Second, opposition within both the USA and the EU comes not primarily from firms and workers fearing increased economic competition, but from less traditional trade actors - consumer and environmental groups and citizens - concerned about the erosion of valued regulations. I argue that the unusual politics is the product of two distinct, but related factors. The first is the extraordinary level of cross-investment between the two economies. The second concerns the unique emphasis on addressing non-tariff barriers, particularly regulatory differences, and the significance of the negotiating partner. I test the plausibility of these arguments through within-case variation and by preliminary comparison to other contemporary negotiations of 'deep' preferential trade agreements.
Journal Article
Agricultural Trade Liberalisation in the 21st Century: Has It Done the Business?
Based on a novel, detailed, time-consistent tariff database taking account of import protection developments in the agricultural sector since 2001, we propose a statistical decomposition of the changes in the various types of tariffs. The results show that the multilateral system has played a limited role in trade liberalisation over the period. Many countries have continued to apply much lower tariffs on agricultural products than their WTO ceilings. Moreover, there has been substantial unilateral dismantling of tariffs over the period, so that much of the liberalisation took place outside WTO and regional agreements. The number of regional trade agreements has surged, but their impact on applied agricultural tariffs has been limited. Finally, we investigate the tariffs, trade and production implications for food and agricultural products of two extreme scenarios in the future development of trade negotiations: an ambitious surge of regional agreements and a trade war within the WTO context.
Paper
Against the Grain: Spanish Trade Policy in the Interwar Years
We study the effects of domestic conflict and external shocks on Spanish trade policy in the interwar period. Our account mobilizes a new granular dataset on exports and imports, and good-country level information on tariffs, trade agreements, and quotas. Into the Depression, the mainstay of policy was the tariff. The establishment of the Second Republic in 1931 was a turning point in policymaking. The new regime initiated bilateral trade negotiations. The Republic’s dilemma was to find countries willing to exchange market access. In a daunting international environment, the Spanish case offers a poignant reminder of the perils of going against the grain.
Journal Article
Regionalism and African agency: negotiating an Economic Partnership Agreement between the European Union and SADC-Minus
This article investigates the regional dynamics of African agency in the case of negotiations on an Economic Partnership Agreement (EPA) between the EU and a group of Southern African countries, known as SADC-Minus. I argue that these negotiations were shaped by a pattern of differentiated responses to the choice set on offer under the EPAs by SADC-Minus policy makers and by a series of strategic interactions and power plays between them. I offer two contributions to an emerging literature on the role of African agency in international politics. First, I argue for a clear separation between ontological claims about the structure-agency relationship and empirical questions about the preferences, strategies and influence of African actors. Second, I suggest that, in order to understand the regional dynamics of African agency, it is important to pay close attention to the diversity and contingency of African preferences and to the role of both power politics and rhetorical contestation in regional political processes.
Journal Article
NEGOTIATING THE UK'S POST-BREXIT TRADE ARRANGEMENTS
This paper considers the agenda for UK trade negotiations over the post-Brexit period. There are several groups of countries that will need to be dealt with and we consider the priorities among them. Negotiations with the WTO and the EU are the most important and the most pressing in time, and should be pursued simultaneously. On the former, the UK must try quickly to establish its independent WTO status, which will be greatly facilitated by minimising the changes it proposes to its tariffs schedules. On the EU the UK needs to consider the choices between remaining in the customs union, creating an FTA with the EU and maintaining the 'regulatory union' that is the European Economic Area (EEA). Only when relations with the EU and WTO are clear will it be feasible to negotiate trade deals of various sorts with other countries, ranging from those with which we already have deals via the EU to those that currently trade with us on 'WTO rules'. All of this takes time and we argue that it may be worth pursuing transitional arrangements to extend certain current trading arrangements a few years beyond Brexit in order to make time for serious negotiations.
Journal Article