The East European countries and GATT: the role of realism, mercantilism, and regime theory in explaining East-West trade negotiations

Abstract

The international political economy literature on regimes has focused on relations among the industrialized Western countries. Despite the increasing participation of East European countries in international economic organizations, the literature has neglected the subject of East–West economic relations. To redress this void in the literature, this article assesses the extent to which and the conditions under which realism, mercantilism, and regime theory help explain the Western positions toward negotiations between East European countries and the General Agreement on Tariffs and Trade (GATT). It argues that a thorough explanation requires drawing on insights from all three modes of analysis: realism provides a useful starting point and sets the context, while mercantilism and regime theory enrich the explanation in circumstances in which political issues concerning security subside and trade policy issues surface.

The Distinction Between True and Induced Free Riders: an Application to Gatt de Facto Membership

“…Previous research on GATT has focused on bargaining among the members of GATT and its game theoretic nature (see, for example, Hungerford 1991) and the effectiveness of GATT at breaking down world trade barriers, especially considering the more recent proliferation of nontariff barriers (Deardorff 1987). Other authors have noted that GATT participation is not solely based on the free market orientation of a nation, but also on concerns for security, containment, and differentiation, as well as economic interests (Mendez 1992;Haus 1991). For other interesting research regarding GATT, see Canal-Forgues and Ostrihansky (1990), Finger (1991), Lutz (1991), Nordgren (1991, and Organization for Economic Cooperation and Development (1985).…”

A World Trading System for the Twenty-First Century

“…Notice, though, that the e¤ectiveness of tari¤s as a response to rising income inequality in a country does not hinge on whether trade has caused the rise in inequality; rather it is simply a question of whether the use of tari¤s -and the price e¤ects that their use would generate in the country -might be part of the optimal response to addressing inequality, whatever its causes, given the technologies and factor endowments that exist today. 59 Where does this discussion leave us? The reimposition of tari¤s surely cannot be the centerpiece of an appropriate response to concerns about income inequal-ity.…”

“…Kostecki, 1974, andHaus, 1991). More generally, it is likely that a combination of measures might be needed to secure market access commitments from China, but it is also likely that China is in the best position to know what combination of measures would be most e¤ective while minimizing inconsistencies with its desired economic system 54.…”

“…See, for example, Charnovitz (2014), who makes similar arguments for the reinstatement of Article 8 in some form as that article relates to environmental subsidies 58. That said, it should be noted that Kletzer (2019) advocates for implementing a program of wage insurance in the United States, not the use of tari¤s 59. I am abstracting from the dynamic e¤ects of tari¤s on technologies and factor supplies.…”

A World Trading System for the Twenty-First Century

“…See, for example, Charnovitz (2014), who makes similar arguments for the reinstatement of Article 8 in some form as that article relates to environmental subsidies 58. That said, it should be noted that Kletzer (2019) advocates for implementing a program of wage insurance in the United States, not the use of tari¤s 59. I am abstracting from the dynamic e¤ects of tari¤s on technologies and factor supplies.…”