An ultimatum bargaining experiment on trade union efficiency

We present an ultimatum wage bargaining experiment showing that a trade union facilitating non-binding communication among workers, raises wages by simultaneously increasing employers’ posted offers and toughening the bargaining position of employees, without reducing overall market efficiency.

The CAP and EU enlargement: Prospects for an alternative strategy to avoid the lock-in of CAP support

The integration of the central and east European countries (CEECs) into the Common Agricultural Policy (CAP) could become a major problem. At the Copenhagen European summit in December 2002, the EU agreed a transitional period with a gradual phasing in of direct payments. However, this strategy will not solve the problems of the CAP: budgetary limits remain problematic, the policy ignores possible developments in the World Trade Organization (WTO), and the extension of direct payments to the CEECs will further capitalize, and hence lock-in, agricultural support. The latter makes future reform even more difficult and, to overcome these problems, we suggest an alternative strategy to integrate the CEECs into the CAP. The EU should phase out direct payments by applying a bond scheme. Finally, we consider whether this option is politically viable.

Comparative advantage in demand: Experimental evidence of preferences for genetically modified food in the United States and European Union

The United States (US) exports more than US$6 billion in agricultural commodities to the European Union (EU) each year, but one issue carries the potential to diminish this trade: use of biotechnology in food production. The EU has adopted more stringent policies towards biotechnology than the US. Understanding differences in European and American policies towards genetically modified (GM) foods requires a greater understanding of consumers' attitudes and preferences. This paper reports results from the first large-scale, cross-Atlantic study to analyse consumer demand for genetically modified food in a non-hypothetical market environment. We strongly reject the frequent if convenient assumption in trade theory that consumer preferences are identical across countries: the median level of compensation demanded by English and French consumers to consume a GM food is found to be more than twice that in any of the US locations. Results have important implications for trade theory, which typically focusses on differences in specialization, comparative advantage and factor endowments across countries, and for on-going trade disputes at the World Trade Organization.

The role of food standards in international trade: evidence from Brazilian beef exports to the EU market

The study reviews the literature on global chain governance and food standards to allow for an assessment of Brazilian beef exports to the European Union. The empirical approach employed is based on company case studies. The results suggest that the Brazilian beef chain has little choice but to adapt to market changes as standards evolve. Costs of compliance for meeting international food standards reduce Brazil's comparative advantage. At the same time, changes in the nature of demand have created the need for a more integrated supply chain in order to enhance confidence in Brazil's beef production and processing abroad.

European Union: Shadow WTO agricultural domestic support notifications

The notification of the level of domestic support to the World Trade Organization (WTO) is intended to reflect compliance with obligations entered into at the time of the Uruguay Round. WTO members have often been slow to provide notification of domestic support levels. This makes the process of notification less useful as an indicator of the degree to which changes in policy have or have not benefited the trade system as a whole and exporting countries in particular. The notification of domestic support in the E.U. illustrates the value of a measure that reflects current policies and can therefore act as a basis for negotiation of further disciplines where these are necessary. The E.U. has made major changes in its Common Agricultural Policy (CAP) over the period since 1992 when the MacSharry reforms were implemented. Payments originally notified in the blue box (related to supply control) have over time been changed until in their present form they are unrelated to current production or price levels, and hence can satisfy the criteria for the green box. The E.U. has therefore much more latitude in trade talks to agree to reductions in the allowable trade-distorting support. This paper reproduced the E.U. notifications relating to 2003/04 and extends these with official statistics to the year 2006/07. It then projects forward the components of domestic support until the year 2013/14, based on forecasts of future production and estimates of policy parameters. The impact of a successful Doha Round is simulated, showing that the constraints envisaged in the WTO draft modalities document of May 19, 2008, would be binding by the year 2013, at about the time the next budget cycle in the E.U. starts. Without the Doha Round constraints, further reform might still happen for domestic reasons, but the framework provided by the WTO for domestic policy spending would be less relevant. In that case, much could hinge on the legitimacy of the Single Farm Payment system under the current rules governing the green box.

European Union

Determination of shadow notifications of domestic support for agriculture in the European Union under the WTO (World Trade Organization) Agreement on Agriculture, and consideration of the potential impact of an agreement in the Doha Round of multilateral trade negotiations.

Good practice transfer within small construction specialist trade contractors

Government and institutionally-driven ‘good practice transfer’ initiatives are consistently presented as a means to enhance construction firm and industry performance. Two implicit tenets of these initiatives appear to be: knowledge embedded in good practice will transfer automatically; and, the potential of implementing good practice will be capitalised regardless of the context where it is to be used. The validity of these tenets is increasingly being questioned and, concurrently, more nuanced knowledge production understandings are being developed which recognise and incorporate context-specificity. This research contributes to this growing, more critical agenda by examining the actual benefits accrued from good practice transfer from the perspective of a small specialist trade contracting firm. A concept model for successful good practice transfer is developed from a single longitudinal case study within a small heating and plumbing firm. The concept model consists of five key variables: environment, strategy, people, technology, and organisation of work. The key findings challenge the implicit assumptions prevailing in the existing literature and support a contingency approach that argues successful good practice transfer is not just adopting and mechanistically inserting into the firm, but requires addressing ‘behavioural’ aspects. For successful good practice transfer, small specialist trade contracting firms need to develop and operationalise organisation slack, mechanisms for scanning external stimuli and absorbing knowledge. They also need to formulate and communicate client-driven external strategies; to motive and educate people at all levels; to possess internal or accessible complementary skills and knowledge; to have ‘soft focus’ immediate/mid-term benefits at a project level; and, to embed good practice in current work practices.

Fair trade and European public procurement: legal principles and governance dynamics

Purpose The article examines principles of Fair Trade in public procurement in Europe, focusing on legal dimensions related to the European Public Procurement Directives. Design/methodology/approach The article situates public procurement of Fair Trade products in relation to the rise of non-state regulatory initiatives, highlighting how they have entered into new governance dynamics in the public sector and play a part in changing practices in sustainable procurement. A review of legal position on Fair Trade in procurement law is informed by academic research and campaigning experience from the Fair Trade Advocacy Office. Findings Key findings are that the introduction of Fair Trade products into European public procurement has been marked by legal ambiguity, having developed outside comprehensive policy or legal guidelines. Following a 2012 ruling by the Court of Justice of the European Union, it is suggested that the legal position for Fair Trade in procurement has become clearer, and that forthcoming change to the Public Procurement Directives may facilitate the uptake of fair trade products by public authorities. However potential for future expansion of the public sector ‘market’ for Fair Trade is approached with caution: purchasing Fair Trade products as a marker of sustainability, which started to be embedded within procurement practice in the 2000s, is challenged by current European public austerity measures. Research limitations/implications Suggestions for future research include the need for systematic cross-institutional and multi-country comparison of the legal and governance dimensions of procurement practice with regard to Fair Trade. Practical implications A clarification of current state-of-play with regard to legal aspects of fair trade in public procurement of utility for policy and advocacy discussion. Originality/value The article provides needed elaboration on an under researched topic area of value to academia and policy makers.

Sharing power? Prospects for a U.S. concert-balance strategy

The Pax Americana and the grand strategy of hegemony (or “Primacy”) that underpins it may be becoming unsustainable. Particularly in the wake of exhausting wars, the Global Financial Crisis, and the shift of wealth from West to East, it may no longer be possible or prudent for the United States to act as the unipolar sheriff or guardian of a world order. But how viable are the alternatives, and what difficulties will these alternatives entail in their design and execution? This analysis offers a sympathetic but critical analysis of alternative U.S. National Security Strategies of “retrenchment” that critics of American diplomacy offer. In these strategies, the United States would anticipate the coming of a more multipolar world and organize its behavior around the dual principles of “concert” and “balance,” seeking a collaborative relationship with other great powers, while being prepared to counterbalance any hostile aggressor that threatens world order. The proponents of such strategies argue that by scaling back its global military presence and its commitments, the United States can trade prestige for security, shift burdens, and attain a more free hand. To support this theory, they often look to the 19th-century concert of Europe as a model of a successful security regime and to general theories about the natural balancing behavior of states. This monograph examines this precedent and measures its usefulness for contemporary statecraft to identify how great power concerts are sustained and how they break down. The project also applies competing theories to how states might behave if world politics are in transition: Will they balance, bandwagon, or hedge? This demonstrates the multiple possible futures that could shape and be shaped by a new strategy. viii A new strategy based on an acceptance of multipolarity and the limits of power is prudent. There is scope for such a shift. The convergence of several trends—including transnational problems needing collaborative efforts, the military advantages of defenders, the reluctance of states to engage in unbridled competition, and hegemony fatigue among the American people—means that an opportunity exists internationally and at home for a shift to a new strategy. But a Concert-Balance strategy will still need to deal with several potential dilemmas. These include the difficulty of reconciling competitive balancing with cooperative concerts, the limits of balancing without a forward-reaching onshore military capability, possible unanticipated consequences such as a rise in regional power competition or the emergence of blocs (such as a Chinese East Asia or an Iranian Gulf), and the challenge of sustaining domestic political support for a strategy that voluntarily abdicates world leadership. These difficulties can be mitigated, but they must be met with pragmatic and gradual implementation as well as elegant theorizing and the need to avoid swapping one ironclad, doctrinaire grand strategy for another.

EU membership of the WTO: international trade disputes and judicial protection of individuals by EU Courts

The European Union (EU) is embedded in a pluralistic legal context because of the EU and its Member States’ treaty memberships and domestic laws. Where EU conduct has implications for both the EU’s international trade relations and the legal position of individual traders, it possibly affects EU and its Member States’ obligations under the law of the World Trade Organization (WTO law) as well as the Union’s own multi-layered constitutional legal order. The present paper analyses the way in which the European Court of Justice (ECJ) accommodates WTO and EU law in the context of international trade disputes triggered by the EU. Given the ECJ’s denial of direct effect of WTO law in principle, the paper focuses on the protection of rights and remedies conferred by EU law. It assesses the implications of the WTO Dispute Settlement Understanding (DSU) – which tolerates the acceptance of retaliatory measures constraining traders’ activities in sectors different from those subject to the original trade dispute (Bananas and Hormones cases) – for the protection of ‘retaliation victims’. The paper concludes that governmental discretion conferred by WTO law has not affected the applicability of EU constitutional law but possibly shapes the actual scope of EU rights and remedies where such discretion is exercised in the EU’s general interest.