Search Results

This chapter examines two major swings in the balance between rules and the discretion of policymakers in U.S. economic policymaking in the past four decades: one in favor of rules and the other in favor of discretion. Evidence of the swing away from discretion is seen in actual fiscal policy and in the wide consensus among economists against the use of discretionary countercyclical fiscal policy in the 1980s and 1990s. The swing back toward discretion is found in the recent large discretionary fiscal stimulus packages and in deviations of monetary policy from the simple rules that described policy well in the 1980s and 1990s. Before elucidating the causes and effects of these swings, the chapter considers the economic and political rationale for policy rules. It suggests that the swing toward rules improved macroeconomic performance while the swing back toward discretion worsened it.

This chapter examines Argentina's relationship with the International Monetary Fund (IMF) during the period 1976–1984. It tracks Argentina's engagement with the IMF from the arrival of a Fund mission soon after the military junta took power in 1976 through to the economic meltdown in the last months of 2001, which culminated in the withdrawal of IMF support for the country and the largest sovereign default in history to that point. The Argentina-IMF case is used to test the argument linking treatment of borrowers to shared economic beliefs. The chapter first provides an overview of economic policymaking in Argentina in 1976–1981 and in 1991–2001; economic policymaking in the latter period was dominated by neoliberals. It also compares the economic beliefs of neoliberals with those of structuralists and concludes with a discussion of the breakdown in Argentine-IMF relations.

This chapter seeks to capture and establish the major economic policy trajectories that emerged from China's entry into the World Trade Organization (WTO). It explains the pattern of these trajectories, then approaches these tasks in a series of steps. The chapter first conceptualizes the policy options available to the Chinese government in responding to WTO entry in terms of three competing state strategies. It then disaggregates the “black box” of the Chinese state into its component leadership and governmental actors in charge of economic policymaking and lays out their differential political interests vis-à-vis WTO entry. The chapter also gathers an original data set of industry regulations issued by all the various arms of the Chinese state at different levels of authority. Ultimately, the chapter applies automated textual analysis to the corpus of documents, thereby uncovering different approaches to economic governance latent in the bureaucratic language deployed by Chinese substate actors. It ultimately argues that different economic stakeholders within the state in fact responded to WTO entry with a variety of divergent policies.

This chapter shows the theoretical framework of the book, beginning by outlining the three competing state strategies through which different government actors can respond to World Trade Organization (WTO) entry. To introduce the theory, the chapter disaggregates China's sprawling party-state into the relevant actors influencing economic policy and explicates the fragmented structure of policymaking within which these actors operate. After discussing the economic and institutional channels through which WTO entry alters the interests of different political-bureaucratic actors, the chapter introduces the range of strategic options available to these actors in responding to WTO entry. The two main variables driving an actor's strategy choice are the unevenly distributed likelihood of being sanctioned for deviating from WTO rules and the varying prospects for political advancement. Ultimately, the chapter systematizes these dynamics with a set of hypotheses predicting how an actor's choice of strategic response to WTO entry varies across administrative levels, within the central government, and across industries.

This chapter discusses the various contributions of this study to international relations and the political economy of China by highlighting the value of disaggregating state responses to global economic integration. It turns to the ways in which the findings of this book apply beyond the case of China in expanding our understanding of the relationship between global integration and the domestic politics of economic policymaking. The chapter also unpacks the authoritarian Chinese state into its multiple actors who wield authority over economic policy and delineates the channels through which these actors engage with the new challenges and opportunities introduced by globalization. It also provides a new explanation for the emergence of what has come to be called Chinese “state capitalism.” The chapter offers a new explanation for why, rather than constraining authoritarian states or credibly committing them to global economic rules, WTO entry alters politics within the state and provokes divergent responses from different substate actors in ways that do not necessarily strengthen the transition toward market economy governance.