Economic Diplomacy, Trade, and Commercial Policy: Positive and Negative Sanctions in a New World Order

The economic instruments of diplomacy have become increasingly important since the end of the cold war. Filling an important gap in the international trade literature, Economic Diplomacy, Trade and Commercial Policy examines the impact of international diplomacy and economic sanctions on trade and investment.

Recognizing the impact of uncertainty on international economic policy, van Bergeijk investigates the trade-off between the peace dividend and the trade dividend since the end of the cold war using an expected utility approach to trade uncertainty. This approach allows him to assess rigorously the determinants of success and failure for the economic instruments of modern diplomacy. Case studies, an extensive review of the literature and empirical investigations of 103 sanctions and the commercial relations of 40 countries vividly illustrate the problems at hand. The author's findings support the need for institutional change in the management of the global economy with the creation of a world trade and investment organization to protect trade against the vagaries of modern politics.

Presenting a unique combination of theory and new empirical findings drawn from international economics and political science, this important book makes a substantial contribution to the analysis of economic sanctions and the impact of modern trade and diplomacy. Successfully bridging the gap between international trade theory and political science, this book will be welcomed by students and researchers in both disciplines.