chap 12 (1)

Introduction

The World Trade Organization (WTO/GATT)

The United Nations (UN) and UNCTAD

Organization for Economic Cooperation and Development (OECD)

Case study: economic transition in Central and Eastern Europe

Conclusions

CHAPTER 12; INT. TRADE ORGANIZATIONSInternational Trade & the World Economy; Charles van Marrewijk

Explanations for trade

Classical 2. Opportunity costs 3. Comparative advantage

Neo-classical 4. Production structure 5. Factor prices 6. Production volume 7. Factor abundance

1. The world economy

New trade 9. Imperfect competition 10. Intra-industry trade

Policy

8. Trade policy

11. Strategic trade policy

12. Int. trade organizations 13. Economic integration

17. Applied trade policy modeling

Economicgeography

New interactions 14. Geographical economics 15. Multinationals 16. New goods, growth, and development

Industrialorganization

Internationalbusiness

Growth theory

Part

IPa

rt I

IP

art

III

Part

IV

18. Concluding remarks

Introduction





Conclusions


Introduction International Trade & the World Economy; Charles van Marrewijk

Objectives / key terms

Beggar-thy-neighbor World Trade Organization (WTO)

General Agreement on Tariffs and Trade (GATT) United Nations (UN)

UN Conference on Trade and Development (UNCTAD)

Organization of Economic Cooperation and Development (OECD)

Central and Eastern European economic transition process

Jan Tinbergen (1903-1994)

Introduction





Conclusions


The World Trade Organization (WTO/GATT) International Trade & the World Economy; Charles van Marrewijk

The international GATT agreement is based on three principles:

• Non-discrimination; as expressed in two sub-principles

- Most Favored Nation (MFN) treatment

- National treatment of foreign products

Two main exceptions to the non-discrimination principle:

- Free trade areas and customs unions

- Developing countries

• Reciprocity (exception: developing countries)

• Prohibition on trade restriction other than tariffs (exception in case of balance-of-payments problems)

The World Trade Organization (WTO/GATT) International Trade & the World Economy; Charles van Marrewijk

0

20

40

60

80

100

120

1945 1955 1965 1975 1985 1995

year

num

ber

of c

ount

ries

at s

tart

Firs

t

Sec

ond Thi

rd

Fou

rth

Dillon

Kennedy

Tokyo Uruguay

Duration of GATT rounds and number of countries involved.

Introduction





Conclusions


The United Nations (UN) and UNCTAD International Trade & the World Economy; Charles van Marrewijk

UN established in 1945, deals with many issues (culture, human rights, security, etc.); for economics most important ECOSOC:

• Programs and Funds; UNCTAD, UNDP, UNHCR, UNICEF, etc.

• Functional Commissions; Social Development, Human Rights, etc.

• Regional Commissions; ECA, ECE, ECLAC, ESCAP, etc.

• Specialized (independent) Agencies; ILO, FAO, UNESCO, WHO, WorldBank, IMF.

UNCTAD established out of dissatisfaction with the role of developing countries in the world economy (Group of 77); publishes the World Investment Report.

Introduction





Conclusions


Organization for Economic Cooperation & Development, OECD International Trade & the World Economy; Charles van Marrewijk

Introduction





Conclusions


Case study: economic transition in Central and Eastern Europe International Trade & the World Economy; Charles van Marrewijk

Incr

easi

ng d

egre

e of

pri

vate

con

trol

market socialism

Increasing degree of private property

capitalism

welfare state

socialism /communism

A

Economic transition has different dimensions


Manufactures

Food

O

A

B

C

DE

ppf


40

60

80

100

120

140

1989 1990 1991 1992 1993 1994 1995 1996 1997 1998 1999

Hungary

Poland

Slovak Rep.

Russia

Ukraine

GDP/capita (index, 1990 = 100)

Introduction





Conclusions


Conclusions International Trade & the World Economy; Charles van Marrewijk

GATT, replaced by WTO, deals most directly with international trade problems (GATT rounds to reduce trade barriers become more complicated, take longer and involve more countries over the years).

UN organizations affect all aspects of human life; UNCTAD focuses on problems of developing countries.

OECD is organization of economically more advanced countries.

Adjusting a country’s organizational and institutional framework is an enormous and time-consuming process, as illustrated by the Central and Eastern European countries.

chap 12 (1)

Business