Clash of Powers: US-China Rivalry in Global Trade Governance

Hopewell, Kristen

doi:10.2139/ssrn.3731062

Cited by 15 publications

(28 citation statements)

References 160 publications

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“…The conflicts are not so much over competitiveness in third-country markets as in overall bilateral trade volume. The USA has accused China of currency manipulation, coerced technology transfers and unfair trading practices (Hopewell, 2020; Mavroidis and Sapir, 2021). Some of these conflicts were concentrated in specific economic sectors such as agricultural subsidies, fisheries and export credits but the most salient conflicts were not sectoral at all.…”

Section: Three Explanations For the Us–china Trade Conflictmentioning

confidence: 99%

Domestic macroeconomic sources of the USA–China trade conflict

Caporaso

2024

ITPD

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PurposeTrade relations between China and the USA have been marked by conflict, especially since China’s membership in the World Trade Organization (WTO). These conflicts have been analyzed from a variety of perspectives, including the loss of jobs in the USA due to Chinese imports, competition in high technology sectors and the balance of trade. Conceptual frameworks have employed models of domestic differences as well as models of international power distribution. Among domestic differences examined are the existence of state-owned enterprises in China compared to the domination of the USA economy by private firms, the large role of the Communist Party in China and the influence of labor and environmental and labor groups in the USA. Power distribution theories focus on the systemic effects of the distribution of power on trade openness and on the pattern of intra-bloc versus between-bloc trade. This paper aims to examine the role of macroeconomic policy factors in China and the USA, in particular, the role of national patterns of savings, investment and consumption (both private and government). The paper concludes that insofar as the balance of trade is an important component of the trade conflict, domestic macroeconomic factors continue to be important. The resolution of the conflict will have to take into account the respective macroeconomic policies of China and the USA.Design/methodology/approachThe design is an analytic case study of US–China trade relations with a particular focus on the balance of trade. The conceptual framework employed involves an analysis of macroeconomic policy categories, especially the overall pattern of savings (household, firm and government), investment and consumption. Process tracing over time since China's membership in the WTO is carried out with an eye toward the relationship between the balance of trade and macroeconomic policy.FindingsThe main findings are that there is a strong relation between the respective macroeconomic policies of the USA and China and their trade relations. The domestic political economy of the USA encourages consumption and a low rate of savings. The opposite is true of China where household income is low by design and national savings are high. China depends on the USA to consume what is not consumed domestically. The USA depends on Chinese imports for additional consumption encouraged by its low rate of savings. The two economies are locked in a mutual dependence.Research limitations/implicationsKey research implications are that there should be more focus on domestic macroeconomic policies since these are the root causes of the trade imbalance. This is not to say that trade frictions centering on jobs, subsidies and competition in high technology are unimportant. However, without the resolution of differences in the management of macroeconomic policies, trade conflicts between the USA and China will continue.Practical implicationsPractical implications are huge, in some ways much more important than the academic implications. Macroeconomic policy differences in savings, investment, government spending, taxation and infrastructure are important. Furthermore, there are available tools in both China and the USA to manage the macroeconomy, particularly, monetary and fiscal policy.Social implicationsOne implication of this paper is that satisfaction or dissatisfaction of workers is dependent on income distribution which in turn affects trade. Treatment of people in different socioeconomic categories, such as the elderly, the young, and those at working age are a function of macroeconomic policies.Originality/valueMany people have written about macroeconomics. It is a conventional subfield of economics. The originality of this paper lies in its advocacy of a shift of focus and attention and in the argument that traditional macroeconomics is related to trade. Despite its importance, macroeconomics has not been the center of attention for most political scientists, though economists have made it more central.

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Section: Three Explanations For the Us–china Trade Conflictmentioning

confidence: 99%

Domestic macroeconomic sources of the USA–China trade conflict

Caporaso

2024

ITPD

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“…The issue of increasing US-China rivalry is widely studied in scientific literature (i.e., Agten, 2021;Allison, 2018;Heisbourg, 2020;Hopwell, 2020;Martin, 2012;Khanna, 2019;Kissinger, 2014;Kuik, 2021;Lo, 2021;Rudolf, 2021;Sun, 2019). This is a derivative of high rank and vibrant interest in transformations of the global balance of power and in political interest in their results.…”

Section: Literature Reviewmentioning

confidence: 99%

European Union at the Dawn of Technological Cold War

Gajewski

2023

TIS

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The purpose of the study was to construct a picture of the EU’s global position in a world defined by the US-Chinese technological Cold War. Morphological analysis has been used to enable a comprehensive analysis of the relationship between the technological and social domains. Structured interviews were also used to support the analytical process. The results of the exploration showed a picture of the EU’s multi-level technological weakness compared to competing powers. While the EU is not a weak entity, its future international position will depend on the creation of its own technological capabilities and on cooperation with the United States. Both lines of action are subject to multiple risks. Firstly, some aggressive technological developments (such as the plans to place microchips production in Europe) can generate more problems than diversification. Secondly, the EU must extend its work on high-tech (primarily AI) beyond the logic of market regulation and focus on their geopolitical and military dimension. It must also be ready for possible obstacles in cooperation with the United States. The alternative to this track, as the analysis shows, is the technological, and hence the political and economic peripheral status, where two technological superpowers – the United States and authoritarian China will compete. The most negative result for the EU is the status of “digital colony”. The paper aspires to be a part of the effort to fill the existing void in the scientific output of Polish social sciences, regarding exploration of the geopolitical dimension of technological progress, especially its impact on EU’s position in the new power distribution model, which will be the result of the rivalry between the US and China.

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“…Since the crisis, the US 'share of global economic power fell from 50% to just 15% in 2017' (McCoy 2018). This changing of the world-economic guard motivated Trump, whose administration challenged the WTO's trade dispute mechanism, intensifying a trade war with China, advancing protectionism at the expense of the global trade system (Hopewell 2020).…”

Section: The China 'Risk'mentioning

confidence: 99%

Shock and Awe in the UNFSS

McMichael

2021

Development

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The unholy alliance between the UN and the World Economic Forum in staging a Food Systems Summit is the culmination of deepening public partnerships with the corporate food sector on an international scale. This article examines how the WEF has exploited this relationship to position its private constituency to oversee global food market governance at the expense of multilateral principles, and against China's expanding state-centered model of international self-reliance.

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Clash of Powers: US-China Rivalry in Global Trade Governance

Cited by 15 publications

References 160 publications

Domestic macroeconomic sources of the USA–China trade conflict

Domestic macroeconomic sources of the USA–China trade conflict

European Union at the Dawn of Technological Cold War

Shock and Awe in the UNFSS

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