Publisher Description

Economic news once confined to the business pages of the newspapers now receives headline coverage, whether it involves protests in Seattle or sweatshops in Asia. As attention is increasingly focused on economic policy, it becomes even more important for noneconomists to be able to make sense of these stories. Is the Asian economy sinking or rising? What effects will a single European currency have on the US economy? Kenneth W. Dam's The Rules of the Global Game provides, in clear and practical language, a framework to help readers understand and answer such questions. Dam takes us beyond the headlines and inside the decision-making process as it is populated by lobbyists, special interest groups, trade associations, and public relations firms. While some economists and thinkers have idealized plans for US international economic policy, Dam, currently the deputy secretary of the treasury, manages to merge this idealism with a consideration of what it means to govern at the intersection of competing groups with competing claims.

In The Rules of the Global Game, Dam first lays out what US international economic policies are and compares them to what they should be based on how they affect US per capita income. With this foundation in place, Dam then develops and applies principles for elucidating the major components of economic policy, such as foreign trade and investment, international monetary and financial systems, and current controversial issues, including intellectual property and immigration. Underlying his explanations is a belief in the importance of worldwide free trade and open markets as well as a crucial understanding of the political forces that shape decision making. Because economic policy is not created in a political vacuum, Dam argues, sound policymaking requires an understanding of "statecraft"-the creation and use of institutions that channel the efforts of interest groups and political forces in directions that encourage good economic outcomes.

Dam's vast experience with the politics and practicalities of economic policy translates into a view of policy that is neither academic nor abstract. Rather, Dam shows us how policy is actually made, who makes it, and why, using examples such as GATT, NAFTA, the US-Japan semiconductor agreement, and the Asian financial crisis. A rare book that can be read with pleasure and profit by layperson and economist alike, The Rules of the Global Game allows readers to understand the policies that shape our economy and our lives.

Author Biography

Kenneth W. Dam is the Max Pam Professor of American and Foreign Law at the University of Chicago Law School. He also served as deputy secretary of the treasury, the assistant director for National Security and International Affairs of the U.S. Office of Management and Budget, executive director of the U.S. Council on Economic Policy, and deputy secretary of state. He is the author or coauthor of numerous books, including The Rules of the Game: Reform and Evolution in the International Monetary System, published by the University of Chicago Press.

Table of Contents

Preface Acknowledgments List of Abbreviations Part 1: Angles of Vision 1. The Tension between the "Is" and the "Should Be" The Normative Approach The Positive Approach: A Political Analysis Interest Group Politics Who Does What (and to Whom) in Washington Political Contributions and Interest Groups Rent Extraction The Role of Political Parties Limits to Political Analysis 2. The Role of Statecraft in Resolving the Tension The Presidency, the Executive Branch, and the Congress Implementing Statecraft Strategies A Closer Look at the Private Sector Statecraft in Search of Normative Goals Interest Groups and Public Discourse Openness, Productivity, and Per Capita Income 3. Political Dimensions of Trade Policy Political Analysis The Institutional Setting of Interest Group Politics The Influence of Different Kinds of Interest Groups 4. Normative Dimensions of Trade Policy The Case for Eliminating Trade Barriers: Comparative Advantage Intraindustry Trade The Benefits of Opening Economies to Trade Qualifications to the Case for Free Trade? The Current State of Play Part 2: Trade Strategies and Issues 5. Opening Foreign Markets The 301 Process Sanctions as the Achilles' Hell of 301 The Semiconductor Agreement Example Market Access in the Uruguay Round: Procurement and Agriculture 6. Trade in Services The Nature of Trade in Services The Search for Services Trade Liberalization From GATT to GATS Financial and Telecommunications Services The Path Ahead 7. The Regional Strategy for Opening Markets Regional Trade Agreements Today The Case for and against RTAs: Trade Creations and Diversion Rent Seeking in the Trade Creation/Diversion Equation The Third-Country Effect Interest Groups and NAFTA 8. The Janus Faces of Fairness From Protectionism to Fairness Antidumping Proceedings in Actual Practice Antidumping in a Statecraft Perspective The Semiconductor Agreement, Part II Larger Implications of the Antidumping Law Part 3: Investment and Finance in a Globalizing World 9. Private Foreign Investment Perspectives on FDI Investment as a Driver of Trade Restrictions on Investment as Restrictions on Trade: TRIMS The Failed OECD MAI Effort US Policy toward Inward Investment US Options in Investment Negotiations 10. The Diversity of Monetary and Financial Issues The Moving Theater of Monetary and Financial Issues Exchange Rates and Patterns of Trade Exchange Rates and Trade Compared Managing Exchange Rates 11. The International Monetary System Exchange Rate and Reserve Systems A Political Analysis of US International Monetary Policy The Key Currency Role of the Dollar 12. The International Financial System Underdevelopment in Developing Countries The Asian Financial Crisis The Bailout Issue and Prospective Reforms Policy Issues after the Asian Crisis US Decision Making in International Finance Part 4: Irrepressible New Issues 13. Labor Standards and the Environment Trade and Labor Standards Trade and the Environment 14. Trade in Information The Nature of Information Information Issues The Uruguay Round TRIPs Agreement Subsidies to High Technology 15. Cross-Border Flows of People US Immigration Policy in Historical Perspective Immigration Today An Economic Approach to Immigration Policy The Consequences of Present Policy Short-Term Entrants Reprise Notes Bibliography Index

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