bipolarity multipolarity and free trade recent literature typically attributes the relative scarcity of open international markets to the prisoner s dilemma structure of state preferences with respect to trade i argue that the prisoner s dilemma representation does not reflect the most critical aspect of free trade agreements in an anarchic international system security externalities explicit consideration of these effects suggests that a bipolar international political system has an advantage relative to its multipolar counterpart with respect to the opening of markets among states less credible exit threats and stronger incentives to engage in altruism within its alliances explain the advantage of a two power system the real income gains that motivate free trade are also the source of the security externalities that impede it their ability to internalize these effects makes military alliances the natural basis of agreements to open international markets the evolutionary prospects of alliances vary however ones that are the products of bipolar systems are more likely to evolve into free trade coalitions than are their multipolar counterparts i argue that less credible exit threats and stronger incentives to engage in alliance altruism explain the advantage of a two power system several important limits of the argument should be made clear immediately i argue at the systemic level i attempt to isolate the political and economic incentives for free trade that occur at the level of the international system i do not therefore consider the impact of unitlevel factors on the pursuit of these incentives for example neither the role of special interest groups nor the organization of domestic exchange via hierarchies instead of markets is considered doyle 1986 frieden 1988 ruggie 1982 the conditions i assume are those of standard international trade theory ethier 1983 and illustrative rather than systematic empirical referents are used these restrictions are appropriate given my purpose to demonstrate analytically the advantage of a bipolar international political system with respect to free trade

conflict cooperation and commerce the effect of international political interactions on bilateral trade flows the public choice approach to political economy is employed to gain insight into the connection between international politics and trade flows a model is constructed in which importers are assumed to be rational utility maximizers who seek to satisfy international security as well as economic welfare objectives this model of bilateral trade flows reflects contemporary theory in the field of international economics and it explicitly incorporates the general foreign policy orientation of importers among its determinants the model is tested in 16 annual crosssectional estimations 1960 75 for a complete network of 25 countries the findings show considerable support for the hypothesis that trade flows are significantly influenced by broad political relations of amity and enmity between nations the author concludes that nations adjust trade ties to satisfy security as well as economic welfare goals and that a formal political economy of trade should reflect this fact

an analysis of policy scenario effects on the adoption of energy production on the farm a case study in emilia romagna italy abstract the agriculture sector s contribution to energy production is a central issue in ongoing policy debates and one of the central elements of the development of bioeconomy sector the common agricultural policy cap is one of the main determinants of the different farm strategies of european farmers the cap is now undergoing a thorough revision process which necessarily includes a debate of the role of the policy in rural areas and the effectiveness of the various cap policy mechanisms the objective of this paper is to assess the impact of alternative cap scenarios in the light of the possible changes in 2013 and the willingness to adopt energy plants for energy crops in the province of bologna italy this is pursued using both survey information and farm household mathematical programming models hence using stated intentions and simulated profitability to analyse the adopt of new technologies for energy production the results underscore the relevance of the cap scenarios in altering intentions with regard to the adoption of energy production and the relevant effect of uncertainty in delaying the diffusion of energy production systems

political regimes and international trade the democratic difference revisited how do domestic political institutions affect the outcomes of international trade negotiations specifically are the aggregate trade barriers agreed upon by a democratic pair lower than those by a pair composed of a democracy and an autocracy i revisit these important questions by highlighting some problematic aspect of the analysis by mansfield milner and rosendorff 2000 contrary to their central conclusion i find that whether the aggregate trade barriers are lower for a democratic pair than those for a mixed pair depends on the preferences of the decision makers involved thus although domestic political institutions are important they alone are insufficient to predict a higher level of cooperation among democracies

communities matter institutional preconditions for community renewable energy abstract energy transitions are high on political agendas from a practical viewpoint community approaches are deemed essential in order to transition from a predominantly centralized energy supply to a decentralized one and to exploit the potential of renewable energies in this paper i discuss how the emergence of community based energy projects can be analyzed from an institutional perspective in this context a community is treated as an individual institutional order that shapes decisions i examine how community structures the implementation of biogas cooperatives in the autonomous province of south tyrol in northern italy my findings suggest that community spirit a cooperative tradition and the norms of locality and responsibility are central drivers behind the emergence and constitution of biogas cooperatives not only do these institutional features of community influence the decision concerning which farmers are in or out but also plant location and scale i argue that community is a necessary analytical category for understanding community energy

power politics and international trade r recent literature attributes the relative scarcity of open international markets to the prisoner s dilemma structure of state preferences with respect to trade we argue that the prisoner s dilemma representation does not reflect the most critical aspect of free trade agreements in an anarchic international system namely their security externalities we consider these external effects explicitly doing so leads us to two conclusions 1 free trade is more likely within rather than across political military alliances and 2 alliances are more likely to evolve into free trade coalitions if they are embedded in bipolar systems than in multipolar systems using data drawn from an 80 year period beginning in 1905 we test these hypotheses the results of the analysis make it clear that alliances do have a direct statistically significant and large impact on bilateral trade flows and that this relationship is stronger in bipolar rather than in multipolar systems in the early 1970s students of international relations began what would become a long and heated debate about the political correlates of open international markets recently however an important element of consensus has begun to emerge most contributors to this debate now seem to agree that the prisoner s dilemma structure of state preferences with respect to trade explains the relative dearth of open international markets here we argue that what has become the standard prisoner s dilemma representation neglects the most critical aspect of free trade agreements in the anarchic international system namely their security externalities we consider these external effects explicitly in order to do so we construct and analyze a simple game theoretic model the results of this analysis demonstrate that tariff games between allies differ systematically from those played between actual or potential adversaries these differences imply that free trade is more likely within rather than across political military alliances however our analysis also suggests that the evolutionary prospects of alliances vary those that are the products of bipolar systems are more likely to evolve into free trade coalitions than are their multipolar counterparts less credible exit threats and clearer responsibilities for alliance stability explain the advantage of a bipolar system we test this argument using data drawn from an 80 year period beginning in 1905 the empirical analysis supports our argument it demonstrates that alliances have a direct statistically significant and large effect upon bilateral trade moreover it shows that on average alliances have a much stronger effect on trade in a bipolar than in a multipolar world 2

lies defection and the pattern of international cooperation this article characterizes how incentives to lie affect international cooperation and the design of cooperation agreements i study the optimal structure of cooperation agreements in an environment where the costs of cooperation fluctuate over time cooperation is complicated by the fact that the costs of cooperation are private information and participants can benefit from lying about them when the extent of asymmetries of information between the cooperating governments can be measured in terms of the transparency of the political process democracies face greater contracting opportunities than authoritarian regimes however this article shows that even under asymmetries of information a limited extent of cooperation can be achieved when the design of cooperation agreements recognizes incentives to lie

correction to the political determinants of international trade efforts to replicate our study of the effects of politics on trade flows between the major powers have revealed that the computer program written to calculate the estimates produced errors in both the coefficients and the standard errors furthermore these errors have some consequences for the results in this brief corrigendum we present corrected tables for our research note and a slightly modified interpretation of the results our study examined evidence to assess three arguments about how politics may affect trade the first contends that positive political relations in a dyad result in higher levels of trade this argument leads to two hypotheses states in conflict will have a lower level of trade than those not in conflict and trade will increase with the degree of common interests between a pair of states the second argument concludes that democratic dyads will have a higher level of trade than other dyads the third argument focuses on the security concerns of states and leads to the hypotheses that alliances will increase trade in a bipolar system but will have no effect in a multipolar system we refer readers to the original article for a fuller statement of the logic of these arguments their respective hypotheses and a complete statement of our research design and operationalization of the variables morrow siverson and tabares 1998

defence spending in the u k regions short j 1981 defence spending in the u k regions reg studies 15 101 110 this paper traces the incidence of defence expenditure in the regions of the united kingdom over the years 1974 1975 1977 1978 inclusive it examines contracts with industry and the expenditure resulting from the deployment of ministry of defence manpower this paper shows that significant differences exist between the levels of defence expenditure in the regions reflecting these two factors it concludes that the scope for using defence expenditure to influence regional income and employment is limited

does foreign policy determine foreign trade cointegration analysis of exports from selected countries to the middle east the paper analyses the relations between foreign policy and export performance the paper deals with exports of selected european countries and the usa to middle eastern countries including israel cointegration analysis is used to identify common stochastic trends in export series a long term relationship implies no significant influence of foreign policy differences on trade performance according to the johansen tests applied to bivariate and multivariate models german austrian dutch and eu exports to israel are cointegrated with the us exports while swiss exports are never cointegrated with the exports of these countries this result confirms the importance of foreign policy in trade performance

the impact of different energy policy options on feedstock price and land demand for maize silage the case of biogas in lombardy abstract the growing demand of maize silage for biogas production in northern italy has triggered an intense debate concerning land rents maize prices and their possible negative consequences on important agri food chains the aim of this work is to quantify the extent to which the rapid spread of biogas raised the maize price at regional level increasing the demand of land for energy crops for this purpose we applied a partial equilibrium framework simulating the agricultural sector and the biogas industry in lombardy under two alternative schemes of subsidization policy results show that policy measures implemented in 2013 reducing the average subsidy per kwh may contribute to enforce the complementarity of the sector with agri food chains decreasing the competition between energy and non energy uses compared to the old scheme maize demand for biogas would decrease lessening the market clearing price as well as feed opportunity cost for livestock sector and reducing land demand for energy purposes

the political determinants of international trade the major powers 1907 1990 we test three arguments about the effect of international politics on trade flows the first argument states that trade flows are greater between states with similar interests than those with dissimilar interests the second that trade flows are greater in democratic dyads than nondemocratic dyads and the third that trade flows are greater between allies we examine trade flows between the major powers from 1907 to 1990 this period provides variation on all three independent variables of interest and allows us to separate the three arguments empirically we estimate a gravity model of trade with the above political variables added our results demonstrate that joint democracy and common interests increase trade in a dyad but alliances generally do not even when controlling for polarity of the system

paying a visit the dalai lama effect on international trade is political compliance a precondition for healthy trade relations with china the chinese government frequently threatens that meetings between its trading partners officials and the dalai lama will be met with animosity and ultimately harm trade ties with china we run a gravity model of exports to china from 159 partner countries between 1991 and 2008 to test the extent to which bilateral tensions affect trade with autocratic china in particular we investigate empirically whether countries that receive the dalai lama despite china s opposition experience a significant reduction of their exports to china in order to account for the potential endogeneity of meetings with the dalai lama the number of tibet support groups and the travel pattern of the tibetan leader are used as instruments our empirical results support the idea that countries officially receiving the dalai lama at the highest political level are punished through a reduction of their exports to china however this dalai lama effect is only observed for the hu jintao era and not for earlier periods furthermore we find that this effect is mainly driven by reduced exports of machinery and transport equipment and that it disappears two years after a meeting took place

effects of changes in italian bioenergy promotion schemes for agricultural biogas projects insights from a regional optimization model italy has witnessed an extraordinary growth in biogas generation from livestock effluents and agricultural activities in the last few years as well as a severe isomorphic process leading to a market dominance of 999 kw power plants owned by entrepreneurial farms under the pressure of the economic crisis in the country the italian government has restructured renewable energy support schemes introducing a new program in 2013 in this paper the effects of the previous and current support schemes on the optimal plant size feedstock mix and profitability were investigated by introducing a spatially explicit biogas supply chain optimization model which accounts for different incentive structures by applying the model to a regional case study homogenization observed to date is recognized as a result of former incentive structures considerable reductions in local economic potentials for agricultural biogas power plants without external heat use are estimated new plants are likely to be manure based and due to the lower energy density of such feedstock wider supply chains are expected although optimal plant size will be smaller the new support scheme will therefore most likely eliminate past distortions but also slow down investments in agricultural biogas plants

how did wars dampen trade in the mena region abstractthe article investigates the impact of wars on trade in the middle east and north african region using an augmented gravity model that controls for the endogeneity problem in our estimation we introduce a war variable and distinguish between different types of conflicts the results show that wars have a significantly negative impact on exports imports and trade civil conflicts hinder exports imports and trade significantly the disaggregated version of the gravity model shows that non state conflicts have a detrimental effect on bilateral trade flows in manufacturing and that none of the conflicts do affect trade in services we also find that on average a conflict is equivalent to a tariff of 5 of the value of trade

coupling economic and ghg emission accounting models to evaluate the sustainability of biogas policies abstract the aim of this study is to evaluate and quantify the impacts of different biogas and related policies on the agricultural sector as well as their performance in terms of climate change mitigation and associated costs to do so we coupled the partial equilibrium approach simulating the market clearing process with the perspective of life cycle assessment of ghg applying it to the well documented lombardy case results show that the recent italian biogas policy prompting manure utilization and reducing the average subsidy per kwh effectively increased the environmental sustainability of the system which only now seems able to counteract global warming synergies are observed when the recent common agricultural policy greening reform is simultaneously considered by the model

does trade still follow the flag t he economic ties between any two nations are frequently affected by a warming or cooling of bilateral diplomatic relations but there is little to be found in modern economics or political science that helps us understand the connections between international politics and commerce the notion that international economics could be studied in isolation from its political underpinnings or consequences would have been quite alien to mercantilist thinkers in the eighteenth century or to the critics or advocates of imperialism in the nineteenth that economics and politics were inextricably intertwined was taken as a matter of course indeed trade follows the flag was central to these people s understanding of world politics and international economics intellectual trends over the past century radically changed this worldview the ascendancy of liberalism in economic thought brought with it a compartmentalization of disciplines that may now be eroding but we are left with theories of international politics and economics that are very weakly bridged the objective of this study is to map one of the many connections between international politics and commercial ties specifically i seek to identify and measure the effect of changes in state to state diplomatic relations on trade flows between those nations theoretical underpinnings of my effort are in the tradition of public choice political economy frey 1984 because i treat importers as rational utility maximizers and their behavior as determined by preferences pursued within a context of specified constraints the model i put forward is wholly consistent with contemporary neoclassical trade theory but i extend the economists notion of welfare and contend that importers take account not only of the price and quantity of goods and services but of the place of origin of these products and the political relationship between the importing and the exporting nation they do so essentially for traditional security reasons that is importers are motivated to manage their trade relations in ways that minimize risks of disruption in supply or the possibility of hurting friends or

make trade not war this paper analyses theoretically and empirically the relationship between military conflicts and trade we show that the conventional wisdom that trade promotes peace is only partially true even in a model where trade is economically beneficial military conflicts reduce trade and leaders are rational when war can occur because of the presence of asymmetric information the probability of escalation is lower for countries that trade more bilaterally because of the opportunity cost associated with the loss of trade gains however countries more open to global trade have a higher probability of war because multilateral trade openness decreases bilateral dependence to any given country and the cost of a bilateral conflict we test our predictions on a large data set of military conflicts on the 1950 2000 period using different strategies to solve the endogeneity issues including instrumental variables we find robust evidence for the contrasting effects of bilateral and multilateral trade openness for proximate countries we find that trade has had a surprisingly large effect on their probability of military conflict

state owned mncs and host country expropriation risk the role of home state soft power and economic gunboat diplomacy expropriation risk has a binding effect on foreign direct investment fdi however state owned multinational corporations may counter the monopoly power of the host state by leveraging the political influence of their home government the magnitude of this counter force we argue may vary depending on the strength of political relations between the home and host state and the level of economic dependence of the host country on the home market we find supporting evidence of our hypotheses using chinese firm level fdi information between 2003 and 2010

the impact of leadership turnover on trading relations between states we test how domestic political institutions moderate the effect of lead ership turnover on relations between states deriving hypotheses from recent theo retical work bueno de mesquita et al and mcgillivray and smith we examine how leader change affects trading relations between states using dyadic trade data con sistent with hypotheses we find that large winning coalition systems such as democ racies are relatively immune from the vagaries of leadership change in such systems trade remains relatively constant whether leader change occurs or not in contrast when winning coalition size is small as in autocratic states leadership change pro foundly alters relations causing a decline in trade finally we examine instances of poor relations measured by a significant decline in trade compared to historical lev els as predicted instances of poor relations are less common between pairs of democ racies than other dyadic pairings further leadership turnover in autocratic systems restores trading relations between states the effect of leadership change in democ racies is much less pronounced since first drafting this article the united states has invaded iraq and deposed its leader saddam hussein for more than a decade iraq experienced harsh economic sanctions with hussein s removal these sanctions have been lifted and iraq is in the processes of being reinstated into the international community although it was the iraqi people who bore the costs of the sanctions the sanctions were aimed at hussein s regime with hussein removed the prospects for improved relations between iraq and western states look strong while iraq offers an extreme example this article assesses how the turnover of leaders affects relations between states as measured by trade flows in partic ular drawing on recent theoretical developments we examine how domestic insti tutions and leadership turnover affect dyadic trade flows consistent with the theoretical arguments we find that trade flows between states depend on the inter action of institutions and leader turnover

survey of economic implications of maritime and territorial disputes drawing on studies on the economics of conflict this paper reviews the literature on maritime and territorial disputes and it examines an array of economic implications associated with territorial and maritime disputes these include adverse effects on certain economic and development outcomes arising from possible armed confrontation with some of these possibly lingering in the aftermath of conflict there are also various economic disruptions and costs associated with these disputes emphasizing how they also affect the livelihoods of resource users in the disputed areas a clearer understanding of these economic links could help inform and motivate policymakers on mitigating the risks of conflict based on the review of evidence herein the economic implications of conflict in terms of foregone average trade among the country pairs considered in the west philippine sea south china sea in 1985 dollars which differ in important ways but hint at some common channels of impact could range from us 909 3 million to us 98 8 billion more broadly the impacts on a disrupted global production chain can easily amplify these results even further affecting global growth prospects for many decades according to experience

environmental cost effectiveness of bio diesel production in greece current policies and alternative scenarios following european directive 2003 30 ec the greek government adapted legislation that introduces and regulates the bio diesel market the implemented quota scheme allocates the country s annual predetermined tax exempt production of bio diesel to industries based on their ability to meet several criteria a number of bio diesel supply chain stakeholders have criticized this policy for being efficiency robbing and vague this paper uses 2007 data from energy crop farms and three bio diesel producing companies in order to assess these criticisms we study the economic and environmental aspects of the currently adopted policy and compare them to three alternative scenarios we conclude that such criticisms have a merit and that policy makers need to reconsider their alternative options regarding the promotion of bio diesel in transport permission of sales directly to local consumers and promotion of forward integration by farmers are efficiency enhancing and environment friendly means of promoting the use of bio diesel in transport

energy production from biogas in the italian countryside policies and organizational models abstract in recent years italy has witnessed a proliferation of agricultural biogas plants this article argues that institutional factors have played an important role in their diffusion it describes the state and evolution of agricultural biogas in italy and then investigates the extent to which institutional pressures have been influential in shaping organizational models of biogas production it finds that the dominance of one particular organizational model is the result of an isomorphic process in which a monopolistic market legal structures and subsidies play a role the prevalence of this organizational model however does not lead to the effective use of biogas production and furthermore it results in low environmental efficiency for a more sustainable development of bioenergy italian policy makers should reform the existing institutional framework by reorganizing subsidies liberalizing the management of gas grids and involving farmers in local projects

effects of corn stover year to year supply variability and market structure on biomass utilization and cost the availability of corn stover can vary considerably from year to year in a region due to annual changes in yield and area planted with corn such variations interacting with biomass market structures can affect biomass cost and utilization rate this study first characterizes year to year variations in corn stover supply for the us in general and for selected major us corn producing counties in particular there have been 20 30 year to year variations in stover supply in the us since 1975 game theoretic analysis is then applied to examining corn stover utilization rate and production cost in three market structures the analysis reveals that a free market structure will take the form of oligopoly oligopsony where large stover supply variations will expose both biorefineries and farmers to significant price volatility price equilibrium will shift significantly from year to year of the three market structures analysed the derisked supply market structure will be most favorable to biorefineries and farmers under this structure biorefineries will maintain a stover supply region that is based on derisked lower than average yield density to buffer for the supply uncertainty associated with annual variations this market structure results in significantly less volatility in biomass cost while on average only 63 of collectable stover will be used for biofuel production our findings suggest that year to year variation in corn stover availability will increase feedstock cost and reduce its potential for biofuel production

trade blocs trade flows and international conflict the relationship between foreign trade and political conflict has been a persistent source of controversy among scholars of international relations existing empirical studies of this topic have focused on the effects of trade flows on conflict but they have largely ignored the institutional context in which trade is conducted in this article we present some initial quantitative results pertaining to the influence on military disputes of preferential trading arrangements ptas a broad class of commercial institutions that includes free trade areas common markets and customs unions we argue that parties to the same pta are less prone to disputes than other states and that hostilities between pta members are less likely to occur as trade flows rise between them moreover we maintain that heightened commerce is more likely to inhibit conflict between states that belong to the same preferential grouping than between states that do not our results accord with this argument based on an analysis of the period since world war ii we find that trade flows have relatively little effect on the likelihood of disputes between states that do not participate in the same pta within ptas however there is a strong inverse relationship between commerce and conflict parties to such an arrangement are less likely to engage in hostilities than other states and the likelihood of a military dispute dips markedly as trade increases between them

biogas and eu s 2020 targets evidence from a regional case study in italy abstract the provision of renewable energy by agriculture so called agroenergy is a key element of the europe 2020 strategy and has sparked public and research debates on the bio based economy hot topics involve direct and indirect land use change and the ability of agroenergy to foster or hinder food and energy security worldwide research has dealt with these and other issues associated with the sustainability of the diffusion of agroenergy generation systems but the subject is still open this paper contributes to the ongoing debate on the sustainability of agroenergy we propose an empirical model to simulate the diffusion of farm biogas installations and estimate a set of indicators covering the economic environmental and social dimensions of sustainability at the regional level model results show that the current incentive mechanism does not allow to meet eu s energy targets at the local level to do so the policy mix needs an improved design accounting for regional peculiarities across the eu model results show that agroenergy production can help farmers stabilise their income and keep viable rural areas despite some trade offs among socioeconomic and environmental indicators major drawbacks are environmental risks associated with farming intensification

free to trade democracies autocracies and international trade trade relations we address this issue by analyzing the relationship between regime type and trade policy in a formal model of commercial policy we establish that the ratification responsibility of the legislature in democratic states leads pairs of democracies to set trade barriers at a lower level than mixed country pairs composed of an autocracy and a democracy we test this hypothesis by analyzing the effects of regime type on trade during the period from 1960 to 1990 the results of this analysis accord with our argument democratic pairs have had much more open trade relations than mixed pairs t he effects of domestic political institutions on trade policy have long been a source of controversy among social scientists despite the widespread interest that this debate has prompted however remarkably few studies have addressed the links between political regime type and commercial policy 1 most work on the political economy of trade policy that examines institutional factors focuses only on variations in policy among democracies and avoids comparing democracies with other types of regimes moreover many analyses of trade barriers especially those by economists ignore the effects of domestic political