Draft

Democratization and Trade

As a student on a political science track I chose to research democratization and trade. All three articles were connected in that they explored the relationship between the two, but all were different articles entirely. Each explored the topic in different amounts of detail and depth.
The first article I researched dealt with democratization and trade liberalization. Daniel Yunichi Kono tackles the issue of whether or not democratization is actually the best answer for trade issues. He used a lot of graphs and mathematic ideas. The main basis of his argument is the thesis by Mayer (1984) that the determination of trade policy is the median voter. If the median voter has a greater proportion of capital to labor then the nation should have more liberal trade policies with labor rich countries. This can help explain why several aristocratic European countries built huge overseas empires in the 19th century; they felt the need to develop labor and resource areas as well as markets for their own capital intensive goods. Democratization has the opposite effect. Giving the vote to more people lowers the wealth of the median voter in a country. This lowering of the capital to labor ratio would lead to more liberalized trade with richer countries who export capital goods. On the flip side is that newly democratized countries will increase trade barriers with countries that are not as rich. This response to democratization can severely restrict trade between neighboring countries in developing areas in the world. Kono compares such a model as being more like a central hub with spokes coming out of it rather than a trading web, with trade being limited between the spokes. His general thesis was that simply spreading democratization is not enough to ensure trade health. It is certainly a large step but should not be the only consideration.
It was interesting to see the hub and spoke model of the first article mentioned indirectly in the second article by Amos A. Jordan and Jane Khaana. The main topic was about the emergence of Natural Economic Territories (NETs) in the Pacific. It was not nearly as abstract or number intensive as the first article. It was mainly an overview of what an NET is and which one of the top nine has the greatest chance of success. An NET is a geographically close association of areas in the Pacific that are not politically aligned but are working together to increase trade and wealth. It is a little hard to grasp what the true definition is since several different models exist and some have extremely ironic connections. This includes the fact that the most successful NETs are associations of border provinces that are breaking away from the policies of their respective central governments, with the blessings of those same central governments. The example I mentioned at the start of the paragraph is the Indonesia-Malaysia-Singapore Growth Triangle. Singapore is a large city with heavy capital reserve where as the Johor region of Malaysia and the Riau Islands of Indonesia are both very poor. The text reads, “Given that the strongest links in this NET are between Singapore-Johor and Singapore-Riau, some argue that it is not a triangle but a corridor managed by Singapore, …” This is the hub and spoke model without using the name. It was nice to see a real life example instead of just seeing a mathematic thesis. The main thesis was that greater decentralization led to greater trade in the Pacific.
The last article was interesting as it came to close to the same conclusion, but from a different direction. Janet Dine claims that greater globalization of trade was actually de-democratic. She claimed to prove that greater democratization in individual countries led to liberalized trade policies. Then she went on to say that these liberal trade policies were de-democratic since it allowed multi-national corporations to run wild. She claims that free trade issues are just politicians’ ways of claiming profit over morals. She wrote as if multi-national corporations were the worst things to ever happen to the human race and that they are off springs of basic institutional corruption. As it was printed in the Indiana Journal of Global Legal Studies it was mainly concerned that those same multi-national corporations are using the lack of international laws to use unfair labor practices and other unethical practices in there attempts to single mindedly pursue profits. Instead of free trade, she promotes the Fair Trade movement and others like it as alternatives. The Fair Trade movement was in its beginning stages when the article was written so she clearly admitted that it was not close to really being effective, but she did claim it was better than free trade. So her thesis ended up being that liberalized trade agreements hurt democratization, instead of democratization and liberalization hurting trade.
It was interesting to see how different each article was on the same basic topic and keywords.