Fundamentals of U.S. Foreign Trade Policy: Economics, Politics, Laws, and Issues

Fundamentals of U.S. Foreign Trade Policy: Economics, Politics, Laws, and Issues

Fundamentals of U.S. Foreign Trade Policy: Economics, Politics, Laws, and Issues

Fundamentals of U.S. Foreign Trade Policy: Economics, Politics, Laws, and Issues


This unique text integrates for the first time the three critical aspects of U. S. foreign trade policy formulation and implementation: economics, politics, and laws. In a comprehensive and nonjudgmental manner, a political scientist, an economist, and a legal scholar combine efforts to present a well-rounded view of the nature and impact of trade policy as well as how it is made. First, they give a quick review of the history of U. S. trade policy and follow this with an explication of key economic principles and theories. They outline political processes and actors, then examine the laws that emanate from the political arena as they apply to imports, exports, the GATT, and the World Trade Organization. A final section combines the three perspectives in an analysis of key challenges to contemporary U. S. trade: Japan, the European Union, nonindustrialized countries, NAFTA, and the Uruguay Round of GATT trade negotiations. Looking toward the future, the authors conclude that given constant changes in the political, economic, and legal environments of trade, the import and export policies of the United States (and of most other countries) are subject to constant evolution-and occasional revolution.


There is no shortage of good academic literature dealing with the foreign trade policy of the United States. Lack of time to read the thousands of books and articles written on this subject is the problem, not the lack of alternatives. Texts on trade theory are so plentiful that they are outnumbered only by the writings with a "policy attitude"--argumentative pieces advocating fewer restrictions on imports, more import restrictions, adoption or nonadoption of industrial policies, and so on. Legal scholars have written hundreds of articles on the meaning and implications of U.S. domestic trade laws and on the international obligations incurred from adherence to the General Agreement on Tariffs and Trade (GATT). Business specialists have written instructional books for would-be exporters and importers. Political scientists continue to write about their quest for a single, unified theory to explain decision- making in U.S. trade policy. Relatively new issues such as the escalation of Japanese- U.S. trade frictions, the North American Free Trade Agreement, declining U.S. industrial competitiveness, and the relationship between trade and the environment have quickly generated numerous studies whose authors argue all conceivable points of view.

Nevertheless, one important kind of trade study is still missing: a basic text that comprehensively explains the content, context, and agenda of U.S. trade policy in terms of the dilemmas inherent in making difficult choices among competing ideas. In this book we argue that trade policy is the result of the perpetual need for policymakers to select from among legitimate albeit competing objectives. Specifically, these objectives are spread among the four components of foreign trade policy: domestic and external economic and political priorities that often suggest diametrically different policy alternatives.

This thesis is found obliquely or not at all in the other writings on this subject. Amid the mountain of literature, we have yet to encounter an academic text that formally recognizes and integrates the three principal elements shaping and moving U.S. trade policy: economic theory, political necessity, and federal legislation. It is the ever-changing hierarchy of these three elements that guarantees evolution and nuance in the U.S. government's export and import actions. Appreciation of the interrelationship among economics, politics, and to a lesser extent statutes is the first step in fully understanding the performance, objectives, limitations, virtues, and failures of U.S. trade policy.

Most existing works view U.S. trade policy in an overly narrow context as essentially a struggle between champions of free trade and advocates of protectionism. Export policy often is completely ignored in the literature; import policy and trade . . .

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