Political Economy of Economic Statecraft

Session Submission Type: Virtual Full Paper Panel

Session Description

How do institutions shape the way governments link economic and security policy? This panel brings together a collection of research that develops the theoretical and empirical study of the political economy of economic statecraft. The first two papers focus on the policy-making process while the second two evaluate the influence of economic statecraft across a range of economic policy areas. Davis, Park and Stanescu examine the micro-foundations of bureaucratic design and its consequences for trade policies. They analyze the extent to which the structure of domestic trade bureaucracies reveals underlying government priorities over foreign policy versus industrial policy, then show the impact of this design choice on the politicization of trade policies. Also from the domestic political perspective, the paper by You reveals the importance of foreign governments as actors lobbying economic policymaking. Using a novel dataset of foreign lobbying of U.S. politicians on free trade agreements, she highlights wide variation in lobbying strategies. The next two papers look at how security linkages impact economic outcomes. Morse shows that international security cooperation to counter terrorist financing networks have spillover effects that impact global trade. She finds that international banking standards, which had been introduced to stop money laundering and terrorist financing, also served to suppress exports from the targeted countries. Kalyanpur, Newman and Zhang analyze mechanisms that underlie economic statecraft with evidence from the U.S.-China rivalry. In an event study, they explore the consequences of U.S. sanctions on the market value of Chinese firms listed on U.S. exchanges. These papers set the agenda for closer examination of how government processes and coalitions shape issues at the nexus of security and economic interests.

Sub Unit

• Division 17: International Collaboration

Cosponsor

• Division 16: International Political Economy

Chair

• Paul Poast University of Chicago

Discussants

• Marina Elisabeth Henke Northwestern University

• Dan Honig University College London

Individual Presentations

• Foreign Policy or Industrial Policy? The Design of Trade Bureaucracy - Christina Davis, Harvard University; Yon Soo Park, Harvard University; Diana Stanescu, Princeton University

• Dynamic Lobbying: How to Persuade Congress - Hye Young You, New York University

• International Institutions and Spillover Effects - Julia C. Morse, University of California, Santa Barbara

• When the Hegemon Barks and Markets Don’t Bite - Nikhil Kalyanpur, London School of Economics; Abraham Newman, Georgetown University; Qi Zhang, Georgetown University