Lloyd Gruber

Power Politics and the Free Trade Bandwagon

What explains the worlds newfound enthusiasm for free trade? Are government leaders integrating their economies to achieve Pareto-improving gains? Or is it because a critical mass of pro—free trade governments has acquired the capacity to “go it alone,” leaving would-be protectionists with a choice between a bad option (opening their markets at very high political cost) and an even worse alternative (incurring the still higher political costs of exclusion)? This article suggests that in practice, mutual-gains-seeking motivations are frequently dominated by defensive ones. The North American Free Trade Agreement is a case in point: Without in any way being bullied or coerced, the Mexican and Canadian governments agreed to take part in a multilateral arrangement that the evidence suggests neither much liked. Although hard to reconcile with the political economy literatures positive-sum model of international cooperation, this finding is consistent with the broader “power-politics” model introduced here.

Globalisation with Growth and Equity: can we really have it all?

Abstract As plentiful and productive as recent empirical work has been, we still know very little about globalisations long-run impact on economic development. This is only partly because of data limitations. At least as important, this article suggests, have been theoretical limitations: economists and political scientists have yet to resolve a number of key conceptual points. This article brings these remaining theoretical puzzles to the surface, starting with the link between openness and growth. It then turns to the relationship between trade and inequality. Both links—the one from trade to growth, the other from trade to inequality—have been subjects of heated debate among development economists. By contrast, the main focus of this article is the relationship between these two strands of research. How growth and equity interact is a theoretical puzzle which, though no less basic than the others, has to date received far less attention. The article concludes by laying out a back-to-basics research agenda for future-oriented globalisation research in which this growth/equity trade-off is restored to its rightful place at the theoretical centre of the wider development literature.