Do countries with lower policy-induced barriers to international trade grow faster, once other relevant country characteristics are controlled for? There exists a large empirical literature providing an affirmative answer to this question. We argue that methodological problems with the empirical strategies employed in this literature leave the results open to diverse interpretations. In many cases, the indicators of openness used by researchers are poor measures of trade barriers or are highly correlated with other sources of bad economic performance. In other cases, the methods used to ascertain the link between trade policy and growth have serious shortcomings. Papers that we review include those by Dollar (1992), Ben-David (1993), Sachs and Warner (1995), Edwards (1998), and Frankel and Romer (1999). We find little evidence that open trade policies-in the sense of lower tariff and nontariff barriers to trade-are significantly associated with economic growth.

Trade Policy and Economic Growth: A Skeptic's Guide to the Cross-National Evidence

It is widely believed that current disparities in economic, political, and social outcomes reflect distinct institutions. Institutions are invoked to explain why some countries are rich and others poor, some democratic and others dictatorial. But arguments of this sort gloss over the question of what institutions are, how they come about, and why they persist. They also fail to explain why institutions are influenced by the past, why it is that they can sometimes change, why they differ so much from society to society, and why it is hard to study them empirically and devise a policy aimed at altering them. This 2006 book seeks to overcome these problems, which have exercised economists, sociologists, political scientists, and a host of other researchers who use the social sciences to study history, law, and business administration. It presents a multi-disciplinary perspective to study endogenous institutions and their dynamics.

/pdf/institutions-and-the-path-to-the-modern-economy-4dlla029fs.pdf

Institutions and the path to the modern economy

https://dialnet.unirioja.es/descarga/articulo/4511387.pdf

The origins of order. Self-organization and selection in evolution

This article summarizes and assesses the growing body of empirical research in transaction cost economics (TCE). Originally an explanation for the scale and scope of the firm, TCE is now used to study a variety of economic relationships, ranging from vertical and lateral integration to transfer pricing, corporate finance, marketing, the organization of work, long-term commercial contracting, franchising, regulation, the multinational corporation, company towns, and many other contractual relationships. The main insights and predictions of TCE-in particular, the importance of govering transactions-are becoming increasingly accepted. The empirical support for these claims, however, is much less known. We believe the empirical literature, on the whole, is remarkably consistent with the predictions of TCE-more so than is typically the case in economics. After presenting an overview of the theory and a discussion of some theoretical and methodological preliminaries, we summarize the major findings and discuss their implications, particularly the potential applications to public policy. In an appendix we provide a more comprehensive list of articles, arranged by type of study, as a reference aid for researchers.

/pdf/empirical-research-in-transaction-cost-economics-a-review-9atwaqjxp8.pdf

Empirical Research in Transaction Cost Economics: A Review and Assessment

This critical synthesis incorporates both theoretical and empirical literature on social capital since its original conceptualization by Bourdieu (1986) and Coleman (1988) in the late 1980s. The focus of the review is on educational literature that studies social capital and educational outcomes. After outlining their approach, the authors briefly trace the intellectual history of the concept and its transport to the field of education. Next, they undertake a critical review of the literature by first examining trends in conceptualization, methods, and outcomes and then assessing empirical support for claims that social capital is positively linked to educational and psychosocial outcomes. Finally, they discuss gaps in the conceptualization, measurement, and analysis of social capital in educational literature.

Applications of Social Capital in Educational Literature: A Critical Synthesis

International trade liberalization historically has taken many organizational forms - unilateral, bilateral, minilateral, and multilateral. Given the proliferation of normative views about which of these should be pursued, economists and political scientists have devoted surprisingly little attention to the reasons for the observed variation in the chosen forms. This book is the first to develop a single theoretical framework to account for past liberalization practices and also to anticipate ongoing changes in the international organization of trade policy. Growing out of a multidisciplinary effort combining economics, politics, organization and law, the book's strategic organizational approach will interest students of trade, international relations, or institutional arrangements. Central to the strategic organizational approach is the view that organizational variety reflects alternate governance structures used to facilitate and enforce agreements. Among the successes of the approach are explanations of unilateral liberalization by 19th century Britain, U.S. governance of multilateral liberalization under the early postwar GATT, growing use of bilateral governance to limit nontariff trade barriers, and anticipatio of major moves toward minilateral governance, such as Europe/1992 and the Canada-U. S. Free-Trade Agreement.

Cooperation and Governance in International Trade: The Strategic Organizational Approach

Part I: International Microeconomics. Introduction to the World Economy. Comparative Advantage I: Labour Productivity and the Ricardian Model. Comparative Advantage II: Factor Endowments and the Neoclassical Model. Trade, Distribution, and Welfare Introduction. Beyond Comparative Advantage: Empirical Evidence and New Trade Theories. Tariffs. Nontariff Trade Barriers and the New Protectionism. Arguments for Restricting Trade. The Political Economy of Trade Policy and Borders. Growth, Immigration and Multinationals. Development, Transition, and Trade. Part II: International Macroeconomics. Currency Markets and Exchange Rates. The Balance of Payments Accounts. The Market for Goods and Services in an Open Economy. Money, the Banking System and Foreign Exchange. Short-Run Macroeconomic Policy under Fixed Exchange Rates. Short-Run Macroeconomic Policy under Flexible Exchange Rates. The Exchange Rate in Long-Run Equilibrium. Prices and Output in an Open Economy. Alternative International Monetary Regimes. Macroeconomics of Development and Transition.

The World Economy: Trade and Finance

The economics of organization asks why we observe the organizational variety we do, why that observed variety is only a subset of all possible organization types, and how organizational forms change. This review essay evaluates Stuart Kauffman's NK models from the complexity sciences for investigating these questions. Such models focus on the statistical properties of complex systems that allow us to examine the total ensemble of organization types, which types are ‘neighbors’ of which other types, and the pattern of change in organizational forms, as well as situations where the interactions among the relevant elements or the dynamic characteristics of the system are unknown.

Complexity, organization, and Stuart Kauffman's The Origins of Order

Recent emphases on reciprocity, bilateralism, retaliation, and regulatory restrictions (e.g., pollution, health, and safety standards) in US trade policy have been viewed as serious threats to the liberalization of international trade which characterized the post-World War II period. This paper explores a different interpretation, arguing that the bilateralism, reciprocity, and regulatory standards which have been viewed as moves toward protectionism can also be seen as mechanisms for dealing with the enforcement problem inherent in trade agreements in the presence of costly negotiation, costly enforcement, and strong protectionist constituencies. Trade policy among large economies has aspects resembling a ‘prisoners' dilemma’ because each country has an incentive to engage in opportunistic behavior by reneging on its commitments to liberalization. In the absence of effective third-party enforcement, a ‘self-enforcing agreement’, which through its terms automatically imposes substantial costs on any party guilty of noncompliance, may be one viable means of enforcement. Reciprocity, bilateralism, and regulatory standards can serve to facilitate self-enforcing agreements.

https://www.jstor.org/stable/pdfplus/2600434.pdf

Reciprocity, Bilateralism, and Economic ‘Hostages’: Self-enforcing Agreements in International Trade

Nations dwell in perpetual anarchy, for no central authority imposes limits on the pursuits of sovereign interests. … Because as states, they cannot cede ultimate control over their conduct to an supranational sovereign, they cannot guarantee that they will adhere to their promises. The possibility of a breach of promise can impede cooperation even when cooperation would leave all better off. Yet, at other times, states do realize common goals through cooperation under anarchy.

Beth V. Yarbrough

Papers

Cooperation and Governance in International Trade: The Strategic Organizational Approach

The World Economy: Trade and Finance

Complexity, organization, and Stuart Kauffman's The Origins of Order

Reciprocity, Bilateralism, and Economic ‘Hostages’: Self-enforcing Agreements in International Trade

Cooperation in the liberalization of international trade: after hegemony, what?