Structure of international cooperation in trade, investment and environment

This dissertation analyzes the obstacles against further cooperation in international economic relations. The first essay explains the gradual nature of trade liberalization. I show that existence of asymmetric information between governments provides a sufficient reason for gradualism to exist. Governments prefer starting small to reduce the cost of partner’s betrayal when there is sufficient degree of information asymmetry regarding the partner’s type. Learning about partner’s incentive structure enhances expectations, encouraging governments to increase their current level of cooperation. Specifically, the uninformed government’s subjective belief for the trading partner being good is improved as the partner acts cooperatively. This updated belief, in turn, lowers the subjective probability of future betrayal, enabling further progress in cooperation. The second essay analyzes the relationship between two countries facing two policy dilemmas in an environment with two way goods and capital flows. When issues are independent and countries are symmetric, signing separate agreements for tariffs (Free Trade Agreements-FTA) and for taxes (Tax Treaties-TT) provides the identical level of enforcement as signing a linked agreement. However, linkage can still improve the joint welfare by transferring the slack enforcement power in a case of asymmetric issues or countries. I report non-results in two cases where the policy issues are interconnected due to technological spillover effect of FDI. Moreover, I show that linking the agreements actually reduces enforcement when agreements are linked under a limited punishment rule and policy variables are strategic substitutes. The third essay investigates the welfare/enforcement consequences of linking trade and environmental agreements. In the standard literature, linking the agreements generate non-trivial results only when there is structural relation between the issues. I focus on institutional design of the linkage and show that even if environmental aspects of international trade are negligible linking the agreements might still have some interesting welfare implications under current GATT Rules. Specifically, when traded goods are substitutes in consumption, linking the environmental agreement with trade agreement under the Withdrawal of Equivalent Concession Rule (Article XXVIII) will reduce the enforcement. However, enforcement in environmental issue increases when the same rule is implemented in the absence of linkage.

Disciplining democracy: United Nations peacekeeping, international security and democratization in the post -Cold War era

After the end of the Cold War, democratization and good governance became the organizing concepts for activities of the United Nations, regional organizations and states in the fields of peace, development and security. How can this increasing interest in democratization and its connection with international security be explained? This dissertation applies the theoretical tools developed by Michel Foucault in his discussions of disciplinarity and government to the analysis of the United Nations debate on democracy in the 1990s, and of two United Nations pro-democracy peacekeeping operations and their aftermath: the United Nations interventions in Haiti and Croatia. It probes “how” certain techniques of power came into being and describes their effects, using as data the texts that elaborate the United Nations understanding of democracy and the texts that constitute peacekeeping. ^ In the face of the proliferation of unpredictable threats in the last decades of the twentieth century a new form of international power emerged. Order in the international arena increasingly was maintained through activities aimed at reducing risk and increasing predictability through the normalization of “rogue” states. The dissertation shows that in the context of these activities, which included but were not limited to UN peacekeeping, normality was identified with democracy, non-democratic regimes with international threats, and democratization with international security. “Good governance” doctrines translated the political debate on democracy into the technical language of functioning state institutions. International organizations adopted good governance as the framework that made democratization a universal task within the reach of their expertise. In Haiti, the United Nations engaged in efforts to transform punishment institutions (the judiciary, police and the prison) into disciplined and disciplinary machines. In Croatia, agreements signed in the context of peacekeeping established in detail the rules of functioning of administrations and the monitoring mechanisms for their implementation. However, in Haiti, the institutions promoted were not sustainable. And in Croatia reforms are stalled by lack of consensus. ^ This dissertation puts efforts to bring about democracy through peacekeeping in the context of a specific modality of power and suggests caution in engaging in universal normalizing endeavors. ^