THE POLITICAL ECONOMY OF INTERNATIONAL TRADE

1. TRADE POLICY PREFERENCES

1.1. Preferences are deduced as a result of the changes in income that accrue to different actors when policy changes from free trade to protection or vice versa

2. POLITICAL INSTITUTIONS

2.1. -Concentrating trade-policy–making capabilities in the executive branch seems to be associated with the adoption of trade liberalization in a wide variety of countries

2.2. The administrative capacity of the state is also seen as an important factor shaping trade policy. It is well established that developed countries tend to have fewer trade barriers than do lesser developed countries

2.3. Some authors suggest that their main role is to provide information about other countries behavior and compliance with the rules of the game, others see these institutions as providing a forum for dispute resolution so that partners in trade can feel more secure and thus more likely to trad

3. INTERNATIONAL POLITICS

3.1. Within international policies, the institutions that are part of these policies are important and influential

4. EFFECT OF TRADE ON COUNTRIES AND THE INTERNATIONAL SYSTEM

4.1. Trade liberalization has a positive feedback effect on policy preferences and political strategies of domestic producer groups.

4.2. In the 1980s, many political leaders and some societal groups in countries around the globe changed their views on what their best trade policy choice was.