The Political Economy of International Trade Negotiations

One proposition from economics that is both true and non-trivial is the Ricardian concept of comparative advantage. Its logical corollary – that governments should not intervene into international trade – is almost universally endorsed within the discipline. Hence, economists remain short of a clear grasp of international trade negotiations – be these held under the auspices of the WTO or elsewhere. Why do governments need protracted negotiations to do what is in their own countries’ best interest? What purposes do trade negotiations and agreements serve? Assorting a host of arguments from the entire range of economic schools of thought, Nikolai Ziegler provides a comprehensive answer. That given and the gap between political and economic rationality acknowledged, he explores ways to bridge this gap and make negotiations work more smoothly. A two-level game perspective reveals adjustment screws which may be turned to promote liberal trade policy and international cooperation. Game theoretic illustration and appraisal of these strategic levers is embedded in case studies and cliometric excursions. The reader will not find panaceas. Yet she will aqcuire a deeper understanding of the sensitive clockwork of international trade negotiations, encounter some innovative proposals as to lubricating that clockwork and, hopefully, find this book an interesting reading.