Managed Trade

The trade discussions between the U.S. and China are on-going. Not much is known about the shape and nature of a potential agreement, but it seems possible that it would include elements of managed trade. This paper attempts to examine the direct, first-round spillover effects for the rest of the world from managed trade using three approaches. The results suggest that, in the absence of a meaningful boost in China’s domestic demand and imports, bilateral purchase commitments are likely to generate substantial trade diversion effects for other countries. For example, the European Union, Japan, and Korea are likely to have significant export diversion in a potential deal that includes substantial purchases of U.S. vehicles, machinery, and electronics by China. At the same time, a deal that puts greater emphasis on commodities would put small commodity exporters at a risk. This points to the advantages of a comprehensive agreement that supports the international system and avoids managed bilateral trade arrangements.

Challenging Unwritten Measures in the World Trade Organization: The Need for Clear Legal Standards

ABSTRACT Disputes in the World Trade Organization (WTO) involving the challenge of unwritten measures have increased in recent years. This trend may have been encouraged by the successful challenge of Argentina’s ‘managed trade policy’ as an ‘overarching unwritten measure’ in Argentina—Import Measures. Advancing a claim against an unwritten measure, however, is not an easy undertaking. These measures are not embodied in any law, administrative regulation or judicial decision. Their very existence and precise contours are, therefore, uncertain and must be proven with evidence, which may not necessarily be readily available. The uncertain nature of unwritten measures makes the dispute settlement process significantly more complicated for the complainant, the respondent and the WTO adjudicators. Despite the difficulties in challenging, defending and adjudicating unwritten measures, relatively little has been written on this subject. This article discusses the types of trade concerns that could be challenged as ‘unwritten measures’, and the different legal characterizations (analytical tools) that have been used to challenge these trade concerns in the WTO. The article further explores the practical difficulties that have been encountered in challenges against unwritten measures and how these difficulties have sometimes, but not always, been overcome. The article concludes that there is a lack of clarity as to the correct legal standard that must be applied in the challenge of different types of unwritten measures. There is more work to be done to clarify the applicable legal standards and the types of evidence required to substantiate the existence of unwritten measures.

DREAMS OF ORDER AND FREEDOM: DEBATING TRADE MANAGEMENT IN EARLY SEVENTEENTH-CENTURY ENGLAND

The early 1620s trade crisis had a significant influence on the way public opinion in England regarded economic issues, and the pamphlets written during that period convey the impression that the supply of money was the undisputed primary concern of economic policy. However, monetary matters occupied a prominent position in the political agenda of England only during times of crisis, when the kingdom faced a perceived threat of demonetization. The paper argues that, during the first two decades of the seventeenth century, concern with a positive balance of trade was of only secondary importance, being normally overshadowed by a more fundamental goal: a well-ordered, stable, and properly managed trade. This opened the door for debates about the limits of free initiative and regulation in economic affairs, as evidenced most clearly by the debates about free trade and monopolies that permeated James I’s reign.

TPP, American National Security and Chinese SOEs

Free trade agreements (FTAs) are about far more than free trade. They are about national security. A trade deal may be ambitious in liberalizing or managing cross-border flows in goods, services, intellectual property (IP), and people, but to argue for or against an FTA solely along the axis of free versus managed trade is to miss another vital purpose – the deal can, and indeed should, advance national security. This article makes two points. First, the Trans-Pacific Partnership (TPP) exemplifies the possibility of enhancing the national security the United States, through containment of China and its ruling Chinese Communist Party (CCP). Second, the debate over the definition of state owned enterprise (SOE) is one among many illustrations in the TPP of the link between national security, trade, and containment. The 12 nations negotiating the TPP were aware of this link, and deliberated the definition of ‘SOE’. The TPP excluded the Middle Kingdom from the founding members, while the founders wrote the TPP rules to bind China if it subsequently joined the deal. Chinese SOEs were of concern to them, for bona fide national security reasons, and so also were legitimate sovereign interests in providing goods and services through their own SOEs. The evaluation by America and its 11 TPP partners, as to which entities should be included in the scope of SOE disciplines led to a set of clear rules.

Journal of the History of Economic Thought Preprints - Dreams of Order and Freedom: Debating Trade Management in Early-17th Century England

The early 1620s trade crisis had a significant influence on the way public opinion in England regarded economic issues, and the pamphlets written during that period convey the impression that the supply of money was the undisputed primary concern of economic policy. However, monetary matters only occupied a prominent position in the political agenda of England during times of crisis, when the kingdom faced a perceived threat of demonetization. The paper argues that, during the first two decades of the 17th century, concern with a positive balance of trade was only of secondary importance, being normally overshadowed by a more fundamental goal: a well-ordered, stable, and properly managed trade. This opened the door for debates about the limits of free initiative and regulation in economic affairs, as evidenced most clearly by the debates about free trade and monopolies that permeated James I’s reign.