thepoliticaleconomyofinternationaltrade.docVIP

The Political Economy of International Trade  Learning objectives Describe how political realities have shaped, and continue to shape, the international trading system. Provide a history of the development of the current world trading system Outline tools and methods used by governments to restrict International trade Discuss the importance of the WTO in promoting free trade Discuss the implications of trade barriers for business. This chapter focuses on the political systems and tools of trade policy. The major objective of this chapter is to describe how political realities have shaped, and continue to shape, the international trading system. While in theory many countries adhere to the free trade ideal outlined in Chapter 4, in practice most have been reluctant to engage in unrestricted free trade. The US continues to restrict trade in textiles, sugar, and other basic products in response to domestic political pressures, in addition to more technological and militarily sensitive products. The opening case describes some of the issues relating to agricultural subsidies and development. The impact of agricultural subsidies offered by the U.S. and the European Union sets the stage for the rest of the chapter. With an introduction to tariffs, subsidies, and the development of the World Trading System the chapter describes the evolution of the World Trade Organization and its impact on the global business environment. The chapter ends with a focus on firm strategy and how it can deal with trade barriers.  WebeSource /english/thewto_e/minist_e/minist_e.htm /ip/wto/doha/overview.html /story.html?StoryID=16755 /time/nation/article/0,8599,214934,00.html /markets/newswire/2003/12/04/rtr1170195.html /fullstory.asp?control=1380 /pubs/FTBs/FTB-004.pdf /WORLD/9711/22/s.korea.imf/ OUTLINE OF CHAPTER 5: THE POLITICAL ECONOMY OF INTERNATIONAL TRADE Opening case: Agricultural Subsidies and Development Instruments of Trade Po