The political economy of international trade

TitleThe political economy of international trade
Publication TypeJournal Article
AuthorsCohen, BJ

Math will solve this.

  • John A. C. Conybeare. Trade Wars: The Theory and Practice of International Commercial Rivalry. New York: Columbia University Press, 1987. 
  • Robert Gilpin. The Political Economy of International Relations. Princeton, N.J.: Princeton University Press, 1987. 
  • David A. Lake. Power, Protection, and Free Trade: International Sources of U.S.  Commercial Strategy, 1887-1939. Ithaca, N.Y.: Cornell University Press, 1988. 
  • Helen V. Milner. Resisting Protectionism: Global Industries and the Politics of International Trade. Princeton, N.J.: Princeton University Press, 1988. 
  • Richard Rosecrance. The Rise of the Trading State: Commerce and Conquest in the Modern World. New York: Basic Books, 1986. 

The research agenda of IPE focuses largely on two broad sets of questions:

1. Actor behavior: What motivates government behavior in foreign economic relations, and how is it best explained and analyzed? 

- Choice of level of analysis: system level or domestic level

- Definition of state interest (power vs wealth)

2. System Managemetns: How do state actor's manage or fail to manage their conflicts, and what determines whether they cooperate or fail to cooperate?

- Upward looking analysis (game theory)

- Downward looking analysis (regime theory, HST) - good sum of HST



  • The world is poised "between two fundamentally different modes of organizing international relations: a terrirotiral system composed of states preoccupied with accumulation of power, and a trading system composed of states preoccupied with economic development. 
  • Main thesis: triumph of the trading system of international relations today would be best possible gaurantee of sustained world peace in the future.
  • Optimistic - primarily on cognitive grounds - that the 'current equipoise in IR' will ultimately be resolved intelligently in favor of the trading system.


  • Central issue is the decline of American economic leadership in postwar order. In trading relations, this has meant the emergence of a 'mixed' regime combining multilateralism with elements of economic nationalism and regionalism which may or may not prove stable over long run.
  • Distances himself from HST
  • Remains pessimistic in forecasting a 'mixed' regime of indeterminate stability


  • Stresses the role of corporate trade preferences as influenced by changing degrees of international economic integration over time. The consequences of interdependence are internal to states: they affect domestic social actors' policy preferences, not states' policy instruments."
  • Cautiously suggests that 'the persistence of interdependence, itself a legacy of US hegemony, may promote the maintenance of an open trading system, even after hegemony has passed'.


  • Aim is to provide a perspective on trade wars through a game theory. Core theme of the book is the need for an integrated analytic framework that would explain 'why trade conflicts (including trade wars) occur, how they escalate, and the types of bargaining behavior that one may expect to observe during them.'
  • Emphasizes the positive role that instituions such as GATT can play in limiting conflict or preventing trade wars. 


  • Object of explanation is the determination of policy within states rather than evolution of relations between states. A 'theory of trade strategy', in which protection and free trade are both conceived as legitimate and effective instruments in national policy is developed and then used to illustrate the evolution of US commercial policy 1887-1939. 
  • National trade interests and political choices ultimately are shaped and influenced by the constraints and opportunities of the international economic structure. "Protection and free trade ... are not simply the result of domestic political pressures but the considered response of self-seeking nation-states to varying internationals tructures.'
  • "The international economy will remain relatively open and liberal, despite the decline of American hegemony, because considerable potential for international economic cooperation presently exists.'