Week 1,3: Introduction and Development of the Field Flashcards

Question

# Rationalist Explanations for War, Fearon, 1995 How did the author(s) address this issue?

Answer 1

The framwork of the rationalist argument is predicated on the question: What presents states in a dispute from reaching an ex ante agreement that avoids the costs they know will be paid ex post if they go to war. He uses a standard bargaining model where there are two actors who have specific preferences over a set of issues. These issues can be thought of on a spectrum from 0 to 1 where actor A prefers issues closer to 1 and B preferes issues closer to 0. That is actor B's favorite outcome is if the bargain falls on zero and actor A prefers it falls on 1. So if we have a spectrum and x is some outcome that obtains, and B's favorite outcome is 0 and A's favorite outcome is 1, B's value for outcome x will be 1-x and A's will be x. On this spectrum, A and B can fight with some positive probability p, but there is a cost of war that happens when you choose war (c). So A's value of war is p-cA and B's value of war is then p+cB. So the next logical step is to assign some utiility to this range of outcomes. To do this, we know that if these two states fight that A will win with some positive probabillity and B will win with some positive probability. We can assume some negotiated settlement x exists for A and B on our spectrum from 0 to 1. So from there you can construct A's expected utility and B's expected utility (x) which is the probability that A wins + the probability that A loses - some positive cost for fighting the war. The same thing can be represented for B. So B's utiltiy will simply be 1 - their positive proability - some positive cost C. So given this set up, we can see that from A's value of some outcome x is the range from 0 to x and B's value for an outcome x is from x to 1. So given these assumptions, it's easy to see that there will always exist some subset of our set where player A's utility is greater than their probabilty of winning minus the cost for war and the same goes for B. The key to this is that there is some positive cost C that both parties are incurring. This allows for there to exist an interval where negotiatied settlements can occur between (p-cA, p+cB) where p-cA and p+cB are reservation levels. This ex ante bargaining range derives from the fact that war is inefficient ex post, and the assumptions needed to make this hold are that 1) rational states should know there is some true probability p that one state would win a military contest and this is an agreement they would prefer to a fight 2) states are risk averse or risk neutral over issues 3) there is a continuous range of settlements exists meaning that any disputes are perfectly indivisible that is there is always a feasible bargain between states' reservation levels.

Answer 2

It was imporant to ansser this question using a game theory model becuase it allows fearon to first specify the causal mechanisms that explain war before identifying factors that lead the mechanism to produce an outcome in a specific setting. That is it is important first to understand the causal logic of what is going on in these games. What this allows fearon to do is then argue that showing a factor can occasion an unresolvable commitment or information problem.

Answer 3

Fearon has two major finding: 1) based off of the fact that states are a) risk averse or risk neutral, b) there exists some ability for one state to win the war with positive probability p and c) there is a continuous range of settlements, there should always be a bargaining range where negotated agreements can take place and rationally led states would prefer to war. 2) Fearon also shows that given all this there are two main reasons why rationally led states are sometimes still unable to find an agreement and this is due to a) states have private information about resolve or capability and incetives to misrepresent these and b) states' are not able to actually uphold a deal in certain circumstances

Answer 4

Fearon's finding imply that 1) there is some issue that is divisible between (0 and 1), 2) that actors are risk neutral or risk averse or 3) that there is some positive probability p that exists that a state will win the war

Answer 5

This paper contributes to the literature an explanation for why given having a negotiated bargaining range that two actors would still go to war. Up to now, most of the literature would have suggested that not seeing eye to eye is the main issue, but fearon shows that this is not necessarily the case, and that you can have that barigaining range and due to incentives to misrepreset resolve and capabilities, and private information war can still persist. That is, the cause of war is not just lack of info but it is the thing that prevents this information from being discolosed. What this argument does is that it shows that incnetives to misrepresent and private info arent simply background conditions to be taken for granted in this calculation. For both sides to rationally believe they will win and it have nothing to do with the actors being irrational, it must be that it has to do with their own private information about the strength of their military and what makes these states not want to share this information is that they might not want to appear as the aggressor or they would not want to make themselves seem more vulnerable militarily

Answer 6

James D. Morrow Morrow 1999

Answer 7

Morrow's whole thing is about understanding strategic interaction as it relates to signaling, commitment, and bargaining and he focuses on these three problems becuase they come up over and over again in international realtions. The idea is that states are typically wary of one another because a growth in one's pwer makes another less secure. That incongruency causes some distrust between these states and as such creates uncertainty between actors. If these actors' motives are unknown, they need to find some way to credibly commit to peace so that other actos will trust them. But when you're baragining everyone wants to be better off (or get the best deal) so this creates an additional issue. So he proceeds to discuss how uncertainty about the motivation of others means you have to think 1) are parties able to signal to one another about their motivations? 2) can the parties credibly commit to each other when they dont know their precise motivations? 3) How can the parties negotiate differneces when they are uncertain about what deal the other will find acceptable?

Answer 8

Morrows analysis provides a framework for understanding dynamic itneractions and the use of game treet to understand strategic interactions. Assessing a problem like this first raises the question of credibilty - that is how do we get around the issue of cheap talk? an actor can promist to take an action in the future but will they be able to commit to that promise? Credibility arises with regard to perfection - a strategy is perfect if every move is in the moving player's interst when they must make the move given all future moves in the game if a promise satisfies the test of perfection then it is credible. Uncertaintly arises with games of incomplete information. This is where at least one player posesses private information Noncooperative game theory links perfection with incomplete info so that you can analyze credibilty in the face of uncertainty --- the securlity dilemma occurs bc of uncertainty confounded with a problem of creidbilty

Answer 9

Morrow breaks down the three main components of noncooperative game theory in international realtions. Signaling - a way to consider the problem of unknown motivation. An actor can signal their type to another actor which depends on the assumption that a certain type takes a certain action. Different types can pool or separate that is one type has to do somehting another type if unlikely to do so that the observing party can respond accordingly. To spearate types you can incur a cost (costly signaling) which shows that one type is willing to incur specific costs whikle another type is not. ex. audience costs can allow actors to separate their types and convince others of their mostivation Commitment - this is the idea that you make a promist that others dont beleive you can carry out in the future. For the other actor to believe your promise they need to be able to know your motivation (read your signal) however this isnt the only issue that arises. If your incentives change over time, this is a commitment problem. Insitutions can help with this commitment problem (changing incentives) by making it difficult for leaders or states to renege on commitments by making it more painful for the leader than carrying out the commiment Bargaining - the idea of bargaining is that a solution is offered for a problem and you and another actor don't agree on the ranking of the solutions based off of what you'd prefer. This can be thought of in terms of reservation levels whereby, to strike a negotiation, actors reservation levels have to be equal to their outside options. but since neither one knows the others reservation level and thus what deals are seen as acceptable. so negotiations can fail when there is no zone of agreement or when one side breaks off negotiations. This means that signaling is critical to bargaining since an actor's reservation level determines its type since offers and responses to offers are signals about an actor's reservation level.

Answer 10

By walking through the strategic considerations of signaling, commitment, and bargaining in international relations. He does this with many anecdotal examples from international relations

Answer 11

So the idea is by not simply focusing on the priciples of game theory and listing maxims drawn from those priciples, if we consider individual cases, commitment, signaling and bargaining problems arise very frequently. So we can understand the strategic dimensions of meny cases by understanding these issues in the abstract.

Answer 12

Basically the take-away from this paper is that understanding international realtions requires that you understand (abstractly) the ideas of signaling, commitment and bargaining. Strategic problems will always occur in the domestic and international settings so simple two-level (2x2) games (i.e. prisoner's dilemma, principal agent models) are not enough to characterize these settings, though they are useful for domestic politics. To understand international relations is to understand strategic choice and noncooperative games and how insitutions can serve as ways to stabalize these games.

Answer 13

This paper provides a useful start for understanding many question in international relations as they arise. By understanding baragaining, signaling, and commitment issues, as they pertain to noncooperative games and strategic choice it provides researchers with a lens though which they can understand new problems that arise. So central questions about alliances, the role of military strategy and bargainin gduring wars etc. are all things that can use a stratgic approach to help resolve.

Answer 14

This paper extends ordinary game theory and its principles and maxims to consider strategic choice and noncooperative games in the abstract. so as to provide an overview of how having a solid understanding of strategic choice can help us answer some of the most pressing questions we have about international relations.

Answer 15

Robert Powell or Powell 2006

Answer 16

Robert Powell or Powell 2006

Answer 17

The idea is that In our attempt to understand war, the exisiting work usually frames war as a result of a bargaining breakdown stemming from asymmetric information, issue indivisibilities, or commitmnet problems but the issue is that these specific frames are limited especially when it comes to trying to understand protracted conflicts. It is also the case that history is misrepresented when assessing contexts from this lens.

Answer 18

Powell makes the case that we've just been thinking about these strategic setting incorrectly especially when it comes to bargaining indivisibilities. That is bargaining indivisibilities should be though of as commitment problems. The idea behind this is that when you go to war, you end up actually destroying some of the resources that you'd like to have. So what happens is that going to war leads to a pareto-inferiror outcome. But we need to ask ourselves why these states cant seem to find some pareto effecient outcomes before fighting even starts. This is what powell introduces as the inefficiency puzzle of war. So to understand why prolong conflict occurs and to give accurate credence to history, powell says we might think about wars as an efficiency issue.

Answer 19

So address the issue of understanding prolonged wars powell basically approaches the question in the context of complete-information games where that are no informational probelms. And he uses the complete-information account to be able to abstract away from the informaional problems so that we can take a closer look at bargaining indivisibiliteis. What this will show us is that bargaining indivisibilites arent some distinct solution to this issue of war and that they should really be seen as is a commimtment isseu.

Answer 20

So to understand the inefficiency paradox through the lens of baragiing indivisibility and as such commitment problems, Powell focuses on three main situations since the mechanism can be seen at work in each: 1) preventive war, preemptive attacks rising from first-strike or offensive advantages, and conflicts resulting from bargaining over issues that affect future bargaining pwer. So basically what powell says is that fearon 1995 thinks that bargaining issues provide a rationalist explanation of war bc they eliminate the bargaining range from risk neutral and risk averse states. but what powell argues is that the bargaining range is not empty even if the dispute concerns an indivisible issue. So one of the main things fearon notes needed to be true for his argument to hold in a rationalist persoective is that an issue had to be divisible and powell says actually, it doesnt even need to be indivisble so this issue of baragiing tht you're talking about can actually be thought of as an issue of commitment

Answer 21

So powell attacks the situation in this way becuase he realizes that when states fight it is constly and by virtue of it being costly, a bragining range will always exist even if the states are risk-acceptant or have a first mover advantage so there will always be some agreement you will prefer to fighting so issue indivisuibilty should not be our focus point, what we should focus on is that states cant commit themselves to abiding by agreements - that is their preferences change overtime and as such make it difficult to credibly commit.

Answer 22

What powell finds is that if we use the informational appraoch to understanding war, we would generally argue that prolonged fightinging comes from two parties trying their hardest to receive a better payoff by deomnstraiting (misrepresenting) their toughness or resolve. But this falls flat when it comes to understanding prolonged conflict since over time, the type of the opposing actor becomes more apparent. Also, the idea that there would be no fighitng if there was complete information implies that a satisfied state would perfer appeasing a dissatisfied adversary to fightining no matter how large a concession it takes to satisfy the dissatisfied state. What powell shows, using complete information games, is that bargaining indivisibilities dont solve the inefficiecy puzzle that is the idea that if an issue is indivisible or can only be divided a limited number of ways, there are not pareto superiror peacful settlements. And even if an issue is indivisible, there are still agreemnets both sides prefer to fighting and the main issue is that states cant commit to these agreements. Which begs the question, what prevents leaders from creating intermediate settlements? Powell shows that there are still otucomes that give oth states higher expected payoffs than fighting even when an issue is indivisible and that the real imediment is inabilty to commit. The logic behind this follows from a take it or leave it baragiing protocol, that is, if you have two actos who have some issue that cannot be divided amonst them, you can sort of think of it as either A will control all of the thing or B will and war is a costly way to allocate this. Meaning that A can have the territory with some positive probability and B can too but fighting means that they both incur the cost d which destroys a fraction of this thing they want. If they woiuld have just agreed to award the territory to either A or B, you wouldnt incur the cost d and that is tehcnically preferd to fighting. And so the idea is that given this pareto-efficient outcome, why would these two states fail to secure this? Well, states might find it too hard to commit to this simple allocation. This is the bargainers can commit to future division of the benefits and each actor has the option of using some form of power to lock in an expected share of the thing. How do we know that the inability to commit leads to inefficient outcomes

Answer 23

Erik Gartzke or Gartzke, 1999

Answer 24

The idea behind this paper is that there are so many arguments and conjectures about why war starts and instead of contributing to this list, we need to diassemble and reasseble each argument into one coherent theory that helps us to do empirical reseach. Grarzke says that by virtue of centrality being an issue in rationalist explanations for war, the advent of war is stochastic in and of itself. That is, war is in the error term.

Answer 25

Grarzke uses a positivist approach that is he is trying to understand the outcome of war by using a change in the explanatory conditions. So like what are the variables that would lead a state down the road to war or peace? By taking this stance he is able to repurpose the arugment that fearon makes and say that if war is a commitment problem, why would states ever stop fighting.

Answer 26

So the idea is that grarzke repurposes the idea of uncertainty that rationalists often use to characterize their games. And says that if you belive uncertainty exists for states that go to war, well then it also has to exist for states that remain at peace. So that means that the explanation of uncertainty can't be used to predict when war will happen, which would distinguish it from peace. So the whole idea is that having some specific feature of an actor cant really explain differentation in behavior among actors with similar features.

Answer 27

Grarzke says that if we take uncertainty and incentives to misrepresent capabilities and resolve as a given, then there are actually no factors taht lead the mechanism that we use to explain war to systematically produce one outcome over another. That is the causal mechanisms that we say explain war are actually random since in some cases when all of those mechanisms war occurs and in other cases it doesnt. That is if rationalists say that uncertainty is a part of what causes war to happen, well then the information we have access to cannot actually account for war and so the inforamtion we have can only predict but not explain international conflict. The factors that lead states to war or peace are unique to each event

Answer 28

Becuase grarzke uses a positivist approach, it follows that he simply is taking from the rationalist argument and showing that by virture of a component of your argument being uncertainty, that the unpredictable component of international interactiosn can account for war but they are unpredictable and by rationalist assumption, there is no systempatic relationship between the causal factors.

Answer 29

grarzke uses a proof and shows that uses fearons argument and shows that if two states are playing divide the $100 and they're playing a take it or leave it game, that the optimal proposal state A for example can make is just the expectation of the distribution of reservation prices for their opponenent (B). The reservation wage being the minimum youd be willing to accept unless you go to war. So when a country goes to war, the average of state B's rservation wage distribution is higher than the offer A makes. So what distinguishes war from peace is whether or not state A is able to interpret the type of opponenet player B is and as such their average reservation prices. This means there is equal likelihood of states fighting or staying at peace.

Answer 30

What grarzke is implying impirically is that there is no rigorous rationalist explation for war empirically.

Answer 31

Fearon and wendt

Answer 32

What is the best way to approach the questions posed in international relations? And what do the contrasts between rationalism and constructivism refer to? and are they really waring factions? Rationalism? which takes a more methodological approach or constructivism which uses social explanations for understanding outcomes.

Answer 33

The paper really just lays out the foundatoin for understading and intepreting rationalist and constructivist explations (rationalism being from the bottom up and constructivist being from the top down). It deconstruts some the supposed contradictions between the two approaches and highlights where they converge. And shows that contrary to popular belief, the two areas often yield similar or at least complementary accounts of international life. The two areas are bastically the same once you view them analytically

Answer 34

Fearon and wendt start off by clarifying each approach and how the converge and diverge, and then they discuss the structure of each idea: with the idea that most believe rationalists are agent centric and that constructivists are structure centric.

Answer 35

Jeffry Frieden and Stefanie Walter or Frieden and Walter, 2017

Answer 36

This paper concerns the eurozone crisis, that is what caused the crisis and why it has been so difficult to resolve

Answer 37

Provides a linear perspective on the eurozone crisis

Answer 38

To understand what caused the eurozon crisis and why it is so difficult to resolve, the authors tell the story about what happened from the start until present day.

Answer 39

The authors show that the creation of the eurozone was challenging becuase multiple countries had to adopt a single monetary policy meaning that the european central bank had to devise one monetary policy despite countries having differiing domestic economic conditions. So the ECB set and interst rate that was higher than external interest rates which gave countries an incentive to borrow. Becuase of this incongruence in the interest rate, this encouraged captial flows to external areas which ended up going into the periphery's housing market and construction industries. This contirnued to happen because more capital was flowing into countries like ireland and spain which made their asset prices rise and made them look more attractive to lenders which then fed an upward spiral. This then created a boom then a bubble in the housing market primarily Whats even more is that countries throught the richer and larger coutnries would bail them out but this would create moral hazard or the idea that becuase you know that you will be bailed out you will be more risky which would then make the bailout actually necessary

Answer 40

Frieden and walter suggest that to curb the effects of the financial crisis, that there should have been an insitutional structure designed to deal with the finanacial difficulties of one members state using a conditional fund pattered on the IMF, a plan to wind up troubled banks, a mechanism to restrucutre debts. But memebrs were scared to do this bc they believed that any discussion of ways to deal with a financial crisis would only stimulate fears. So what ended up happening was the "no-bailout" commitment was not credible. That is, bailout expectations meant that even the least creditworthy memeber states were able to borrow at rates roughly equivalent to creditworth states like germany. So if a less creditworthy state got into trouble, more credit worth states would bail it out. and since greece was able to borrow at a low interest rate the governement had major incentives to borrow far more than was prudent. On top of the fact that there should have been some insitutional structre to deal with the fiancnail difficulties, European policy makers could have responded to the build-up of these imbalances by implementing approprate fiscal policies. Friedan and walter suggest that countries like germany and northern european countreis could have sitmulated domestic economic growth and absorbed some of their own savings if they wuold have expended fiscal policy of tax cuts and increased spending so more capital could stay at home. The meain issue with the euro zone crisis is there was no counter cyclical fiscal policies after the euro was introduced. And the main idea was that as a whole, altering fiscal poltiices would help stablaize the eurozone but that qould have required server cooperation from members in desiging and implementing these policies in the inerests of a common purposem but there was no political support for this. So essentially there was a massive collection action problem

Answer 41

Ronald Rogowski or Rogowski, 1987

Answer 42

Rogowski is intersted in understanding why countries have the political cleavages they do

Answer 43

So this paper is unique becuase many researchers answer the question of why countries have the political cleavages they do as a feature of preexisting cultural and religious divisions, the rapidity and timing of industrialization or of the grant of mass suffrage, modernization, the elecotral system and even the product cycle. But rogowski puts forth the argument that in addition to these cariables, that countries with different factor endowments in exposure to international trade is what undergirds the creation and durability of ethnic cleavages. His argument draws from the stoper samuelson theorem which suggests that protection benfits (and liberalization harms) owners of factors in whcih the society is poorly endowed relative to the rest of the world, as well as the producers who use the scarce factors intensively. So for example if you are in a country rich in labor but poor in capital, protection would benefit capital (the scare factor) but harm labor and the liberalization of trade would benefit labor and harm capital.

Answer 44

So the idea behind this paper is that protection benefits, and liveralization of trade harms owners of factors in which a society is poorly endowed. So the classic factors to think about are land, labor, and capital. So if you are rich in say labor and capital and scarce in land, those people who are agriculturalists etc will be harmed by trade liberalization and those that are in the urban areas will benefit. So drawing from this idea is that global changes in the form of trade liberalization etc. should have global consequences and understanding the political consequences of these shifts is really imporant. So continuing on with the example above, if you are a capitalist or worker who benefits from trade, you're going to desire to expand your political influence through for ex. reapportionment of seats in the house or like reviolution etc. so you'll see urban-rural conflict happening. The same also holds for "backwards" economies becuase in these areas, both capital and labor are scares and so both are harmed by expanding trade and will attmept to seek protection. Agriculturalist will gain fro this free trade and try to expand their influcne. And using a 2x2 matrix he uses the SS theorem to hypothesize when political unreset is liekly to occur.

Answer 45

Rogowski uses anecdotal evidence to support his argument. By drawing from argyments about the great depression and the world after WWII

Answer 46

By systemtaically going through examples and also priovideing a 2x2 matrix, rogowski is able to make the SS theorem more concrete in its theory. He uses evidence to support what the theory says about the behavior of indiviudual based off of what can be thought of as an exogenous shift. This allows us to better understand how poltiics reponds to economic conditions.

Answer 47

Rogowski finds that even when we relax the reliance of land-labor ratios, the idea still holds. Though he qulifies this by suggesting that ancient cultural and religious loyalies and historical memories also affect political conflict. But the idea is that when you couple the SS theorem with the poltiical realm, the changes in exposure to trade profoundly affect nations' internal political cleavages

Answer 48

This provides use with a lens through which we can understanding ex-ante when unrest amongst political cleavages will take place.

Answer 49

Rogowski provides one of the first attempts at applhying a purely economic model to poltiics and understanding how the two affect each other.

Answer 50

The key assumption of this argument is that factors of production a re freely mobile. THis is not always the case, so relaxing this assumption would be helpful in understanding if the implications still hold

Answer 51

Michael J. Hiscox or Hiscox 2001

Answer 52

So the whole idea is that understanding international trade is powerful for explaining international political conflcit between 'winners" and "losers" of trade. Some researchers focus on industry groups in the the policy making process while others look to broad factoral or class coalitions to understand confict between winners and losers. Hiscox says okay will empirically speaksing both approaches are sound and make a good case for understanding the centrality of class cleavages in trade politics. However there needs to be some bridge between the two so as to specifiy under what conditions certain arguments hold or dont.

Answer 53

Hiscox is able to find an middle-ground between researchers and bridge the two main ideas together to show when one way of thinking is most applicable.

Answer 54

So what hiscox actually does is that he uses a survey of levels of inter-industry factor mobility in six western countries to show that when there exists variation in factor mobility, this conincides with different stages of inditrialization and differnt amojunts of regulation. He then uses finding from a stufy on trade cleavges in each nation to emphaize the idea that there are direct effects of trade cleavages on policial parties behavior. So basically, broad class-based conflict is more likey to happen when levels of factor mobility are high, and narrow industry-based conflict is more liekly when levels fo mobility are low.

Answer 55

So hiscox like rogoski draws from the stoper samuelson (SS) thoerem which suggest that trade benefits owners of abundant factors of production and that these factors are perfectly mobile dometsically, though immobile internationally. So the logic behind this is that when you increase trade between countries, the price of imported goods will be lower which leads to a decrease in domestic production whihc means that that factor is now freed up. Following that is that returns to the scare factor falls even more when than the price of imported goods meanwhile the returns to the abumndant factor rise and the price of exporeted goods rise as well. This issue with this is that it implies that all owneers of the same factor share the same prferences with respect to trade policy. If you take the ricardo viner model, it says instead that when one or more factors are immobile between industries results completely change. This also suggest that political coalitions forma long industry lines. These two theories examine the extremes but factor mibility is a continuous variable so its imporant to allow varying degrees between gfacotrs which would allow for the predition that borad class-based political coaltiions are morely likely where factor mibility is high and narrow industry-based coalitions are more liekly when mobility is low.

Answer 56

So using measurements of the difference between rates of return for factors in different industires with the idea that if a factor is super mobile between indistries then the rate of return wuold be arbitraged away by factor movement. So smaller differentials indivate higher mobility. Hiscox finds taht inter-industry factor mobility is ac tually affected by economic and techn changes associate dwith industrialization but the impact of those chagnes and their timing vary substantially across nations.

Answer 57

What hiscox's study implies is that the correspondence between changes in inter-industry wage and profit differentials is consistent with the idea that these differentials come about as a result of expogenous shocks to tech and regulatory changes. And technological innovations means like changes in methods of production so like the industrial revolution and the way textiles or iorn etc. were mande. New mills and factorsies instead of craft shops etc. If you take this a step further and analyze the behavior or political parties in trade politics you see that if you map class preferences over trade (as suggested by the SS theorem) onto a model of partisan politics, the stronger the class cleavages over trade the more unified the parties representing factor-owning classes or protestionist platforms are. This is exactly what rogowski shows. SO at high levels of factor mobility the SS effects should ensure that whole factor classes have a unified view on trade. At low levels, Ricardo viner effects will create divisions between owners of the same factor in export and import competing industries. For those parties in the middle, youll have issues centered around religoius, ethnic and regional grupings.

Answer 58

What this implies is that if you see certain political coalitions forming in society to influcne policymaking its super liekly that that is becayse of the extent to which factors of production are mobile between industries.and hiscox is the first persoin to show this empirically. So that means trade isnt the thing taht generates transformation in the existing party system. It is not enough to explain that. bc if it were the only issues two aprties would take up unified and opporing platforms. The correct way to think about this is that the more mobile the factors you expect class cleavages over trade.

Answer 59

Only six cases and all advanced democraies is scant. Need more than six cases and to incudle a range of country types

Answer 60

In Song Kim and Iain Osgood or Kim and Osgood, 2019

Answer 61

Kim and osgood take a look at the differnt trade theories that have risen over time. They center their paper around factor and industry-centered theory of trade, firm heterogeneity in sales and sourcing, firm centered theories, and how firms and political insitutions interact

Answer 62

The point of this paper is to review the literature on trade theory and then put forth an idea about firm heterogeneity in industires.

Answer 63

What kim and osgood start off doing is review factor and industry cnetered theories of trade by first starting with the standard trade model which says focuses on comparative advantage as a result of differences in factor endowment somng countries. A country is gojng nto export the goods that intensviely emply its abundant factors of production. So the literature ususally focuses on models like the SS theorem which assume factors of production are freely mobile across industries and so by increasing trade this pits abundant factors against scare factors. Rocardo viner says factors are trapped in their current insutry adn that factors employed in comparative adgantage indusres will support trade while factors employed in comparative disadvantaged indusries will oppose it. New trade theory - the idea behind new rade theory is that the standard trade models arent really that good at predicting actual patterns of international trade. There is a substantial amount of intra-industry trade that accounts for most of the trade aomngst industirialized countries. So basically a focus on increasing returns to scale and consumer love of variety is what NTT says drives intraindustry trade. So basically if you have fixed costs of production in your country, when you have access to a foreign market, this allows firms to expand our output which effectively lowers the average cost of production. Also if consumers love variety explains why countries would benefit from exachanging similar goods. SO when consumers tastes differ youll see trade between countries that have similar factors of production and technology. but htis theory assumes all firms are the same size and export in the same quntity Focusing on firm hetrogeneity kim and osgood argue that differences in tehc, and factor endowments and consumer love of variety do explain some patter in international trade but there is still so much heterogeneity which has implications for the economic effect of trade and trade policy as well as cleavages over trade. export participation - there is a super highly skewwed distribution of firms' export partiicpation and firm level heterogeneity whcih is inconsistent with the standard trde model since usually elite firm s export, and they are larger and rely on more skilled labor and financial capital

Answer 64

Kim and osgood provide a firm centered theory of trade which predict that more productive (larger) firms should support trade liberalization while less productive firms should not. Further, industries might be internally divided over whether to support or oppose trade liberalization which implies that firm-centerened patterns of lobbying and position taking where individual firms lobby or publicly take positions on trade while industry associations remain inactive. This also implies

Answer 65

Robert Keohane or Keohane, 2009

Answer 66

Keohane focuses on understanding the old IPE which mainly focused on the political implicatios of economic interdependence while the new IPE focuses less on how intersts are constructed and how policies are subject to processes of international diffusion. He then addresses what is missing from persent work on IPE.

Answer 67

Keohane simply goes through what the old IPE was which was created by susan strange which drew from economics (the economic of interdependence) but which defined international economic cooperation or how to maintain openness while enabling states to retain sufficient autonomy to pursue legitimate objectives as the central problem. Keohane contrasted this with the politice of interdependence with statist and security oriented conceptions of international relations which sketched out the concepts of asymettrical independence and power, transgovernmental realtions etc. keohane argued that in situations of complex interdependence there were multiple actors, multiple issues and neither realist model or complex interdenence fully describled world politics. Old IPE sought to explain regime change not just theoretically but with empriical work as well. It was far less causal in nature starts by distinguishing between IPE and OPE which is basically economics and assumes individuasl share identical interests defined as preferences over alternative outcomes and can be measured in material terms.Today we observe much more increased rigor as an extension of OPE which highlights the most explanatory variables in the field often reflect variation in deomestic poltiics reflecting different factor endowments and structures of industrial production. Keohane seens OPE as matrialistic and too inclined to indeitfy rationally with egoism. Keohane sees inesrests as a symbiotic relationship more close to constructivism. It also seems that IPE is less interantikoal now. Keohane suggests what is missing

Answer 68

To address this issue, the authors focus on how to deal with accumulated bad debts. They present twooptions. One has to do with countries who took on debts to repay the debt by cutting domestic spending or increaseing taxes. The other opeion is for countries that give loans to grant debt restructureing options to provide relief to debtor coutnreis. The creats a bargaining issue where by debtor can stop reoaying dept and creditors can decide to not grnat access to credit in the future. The fredain and walter go on to relate debt crises with a balance of payment issues where by debotr countreis usually have BOP deficity where they are importing more than they are exposting. This bascially means that any account deficits are related to external debt levels. They suggest that if countreis want to rebalanace their current accoutns this involves changing the country's exnage rate and devaluing the currency so that a country that has a deficit can make its domestic products more competitive whihc reduces imports and stimulates exports. Another option they suggest is internal ajdustment so that mean altering the relativ epirces of goods via macro policy changes and structural refoms. This can look like a reduction of domestic demand and cuts to public spending, tacx increases and increasing competitiveness. which results in higher unemploement, lower wages and asset price deflation -- that is manufacturing a recession which can hurt reelection

Week 1,3: Introduction and Development of the Field Flashcards

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