Globalization & the State: International Institutions, Finance, the Theory of the State & International Trade Book

List of Tables ix

List of Diagrams x

List of Abbreviations xi

Acknowledgments xv

Introduction, Scope and Content 1

1 Globalization, the World Economy and Growth 7

Introduction 7

Dimensions of the world economy 7

Factors of economic growth 11

Institutions and economic progress 16

Summary 19

2 The Official Institutions 21

Introduction 21

The G7 and the G10 22

The international financial institutions 22

The World Trade Organization 28

The central banks 30

The UN 43

Summary 44

3 Private Institutions 46

Introduction 46

Commercial banks 46

Investment banks 48

Hedge funds 59

Private equity 64

Initial public offerings 71

Summary 76

4 Risk Management, World Trade, Foreign Investment and Finance 78

Introduction 78

Risk management 78

Value at risk 79

Credit risk models 82

Stress tests 95

World trade 100

Financial flows and foreign exchange 101

FDI, equities, securities and derivatives 105

Summary 108

5 The Theory of the State 110

Introduction 110

The first best of efficiency and satisfaction 111

The theory of second best 117

Applied welfare economics 119

The public interest view 125

The theory of public goods 129

Imperfect information and regulation of finance 131

Government failure 133

Coase, transaction costs and property rights 137

The new institutional economics 139

The economic theory of regulation 143

Rent-seeking and public choice 147

The view of disclosure and regulation 150

Summary 155

6 International Exchange of Goods and Services 157

Introduction 157

The gains from trade 157

Distortions 162

Trade openness 163

The political economy of trade 170

Antidumping and safeguards174

Trade and employment 178

Trade and wages 188

Offshore employment 192

Summary 197

Conclusion 199

Introduction 199

The role of the state in IEFP 199

Diversity of views 202

International institutions 203

Private institutions 204

International trade 206

Notes 207

References 209

Index 226