1. For example, contractual promises extracted through duress, fraud, or undue influence may be exempt from enforcement.

2. Conybeare, J. A. C., “International Organization and the Theory of Property Rights”, International Organization 34 (Summer 1980), pp. 325–26.CrossRefGoogle Scholar

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4. The members of the two groups discussed here accept to a greater or lesser extent the desirability of a liberal international trading system. A third group could be added, including many Marxist analysts, who do not accept the basic premise of mutual gains from liberal world trade.

5. A variety of perspectives can be found in Gilpin, R., U.S. Power and the Multinational Corporation (New York: Basic, 1975)CrossRefGoogle Scholar; Kindleberger, C. P., The World in Depression (Berkeley: University of California Press, 1973)Google Scholar, and “Dominance and Leadership in the International Economy,” International Studies Quarterly 25 (06 1981), pp. 242–54CrossRefGoogle Scholar; Keohane, R., “The Theory of Hegemonic Stability and Changes in International Economic Regimes,” in Holsti, O. R., Siverson, R. M., and George, A. L., eds., Change in the International System (Boulder: Westview, 1980)Google Scholar; Krasner, S. D., “State Power and the Structure of International Trade,” World Politics 38 (04 1976), pp. 317–43CrossRefGoogle Scholar; and Snidal, D., “The Limits of Hegemonic Stability Theory,” International Organization 39 (Autumn 1985), pp. 579–614.CrossRefGoogle Scholar

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7. These questions are the focus of the traditional hegemonic stability literature as well as of business-cycle theories of trade policy.

8. This question is emphasized in political economy, public choice, and pressure-group theories of trade policy.

9. The other questions mentioned can also be addressed using the framework developed in this article. However, we chose to limit our focus to the single question of the various possible forms of international trade liberalization. Understanding the historical variation in the structure of international trade liberalization is essential to progress toward a general structural or systemwide theory of trade policy. Some theories that have been suggested (e.g., hegemonic stability) may be able to explain this historical variation; others (e.g., business-cycle theories or domestic pressure-group theories) seem by their nature less likely to be able to address this question, although they certainly play a role in the actual determination of trade policy.

10. J. D. Richardson has suggested the term minilateralism for agreements among small numbers of like-minded participants; see, for example, his “Trade-Policy Implications of ‘Strategic’ Economic Models” (Paper read at the NBER Conference on the Political Economy of Trade Policy, MIT Endicott House, Dedham, Mass. (10–1101 1986).Google Scholar

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12. This general approach to problems has come to be known by various names, including transaction-costs economics and the economics of organization. See Williamson, O. E., The Economic Institutions of Capitalism (New York: Free, 1985)Google Scholar; Yarbrough, B. V. and Yarbrough, R. M., “Institutions for the Governance of Opportunism in International Trade,” Journal of Law, Economics, and Organization (forthcoming).Google Scholar

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14. The primary assumptions include competitive output and factor markets, the absence of external effects in production or consumption, and the absence of economies of scale.

15. Keohane, , After Hegemony, especially pp. 51–55.Google Scholar

16. Factors such as monopoly power, economies of scale, and externalities in production and consumption are ignored or, alternatively, are assumed to be dealt with using policies other than restrictions on trade.

17. The division of gainers and losers refers to the short run. In the long run, the owners of resources used intensively in production of the country's goods of comparative advantage gain from liberalization, while the owners of resources used intensively in production of the country's goods of comparative disadvantage lose according to the Stolper-Samuelson Theorem.

18. This is a functional view of institutions, holding that the existence of institutions can be understood through the functions that those institutions serve. For a discussion in terms of international issues, see Keohane, After Hegemony, especially chaps. 5 and 6.

19. Piccioto, S., “Political Economy and International Law,” in Strange, S., ed., Paths to International Political Economy (London: Allen & Unwin, 1984), p. 172.Google Scholar

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26. Williamson, Economic Institutions. Transaction-specific investment can occur in any durable asset, including human skills. The term capital is used to denote durability.

27. Williamson, , Economic Institutions, especially pp. 194–95.Google Scholar

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29. Cowhey and Long, “Testing Theories,” p. 163.

30. For more extensive discussion of the concept of hegemony, see the works mentioned in nn. 5 and 6.

31. This line of reasoning, if carried further, leads to the Marxist view of hegemony as represented in the work of Stephen, Hymer, e.g., “The Efficiency (Contradictions) of Multinational Corporations,” American Economic Review 60 (1970), pp. 441–48.Google Scholar

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33. For a detailed explanation, see Yarbrough, and Yarbrough, , “Free Trade, Hegemony.” The terminology hegemonic cooperation is from Keohane, After Hegemony, p. 55.Google Scholar

34. See Conybeare, J. A. C., “Public Goods, Prisoners' Dilemmas and the International Political Economy,” International Studies Quarterly 28 (1984), pp. 5–22.CrossRefGoogle Scholar

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36. Gannett, J., “The Role of Military Power,” in Smith et al., Perspectives, p. 71.Google Scholar

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41. Conybeare, “Trade Wars,” especially pages 152–58.

42. See Cuddington, J. T. and McKinnon, R. I., “Free Trade versus Protectionism: A Perspective,” in Tariffs, Quotas and Trade: The Politics of Protectionism (San Francisco: Institute for Contemporary Studies, 1979).Google Scholar The bilateral Cobden-Chevalier treaty was an exception to the basic unilateralism of Britain's trade policy, but noneconomic considerations were prominent in the negotiation of the treaty.

43. McKeown, “Hegemonic Stability.”

44. Cuddington and McKinnon, “Free Trade,” p. 12.

45. See Yarbrough and Yarbrough, “Reciprocity, Bilateralism,” p. 12.

46. For example, Vernon, R., “International Trade Policy in the 1980s,” International Studies Quarterly 26 (12 1982), pp. 504–5.CrossRefGoogle Scholar

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51. Conybeare, “Trade Wars,” pp. 153–57.