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United States and Its Challenge to Multilateralism in the Global Economy

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  • Krishnakumar S.

Abstract

With Donald Trump as President of United States, multilateralism in the world economy is facing an unprecedented challenge. The international economic institutions that have evolved since the fifties are increasingly under the risk of being undermined. With the growing assertion of the emerging and developing economies in the international fora, United States is increasingly sceptical of its ability to maneuvre such institutions to suit its own purpose. This is particularly true with respect to WTO, based on “one country one vote†system. The tariff rate hikes initiated by the leader country in the recent past pose a serious challenge to the multilateral trading system. The paper tries to undertake a critical overview of the US pre-occupation of targeting economies on the basis of the bilateral merchandise trade surpluses of countries, through the trade legislations like Omnibus Act and Trade Facilitation Act. These legislations not only ignore the growing share of the United States in the growing invisibles trade in the world economy, but also read too much into the bilateral trade surpluses of economies with United States and the intervention done by them in the foreign exchange market.

Suggested Citation

  • Krishnakumar S., 2018. "United States and Its Challenge to Multilateralism in the Global Economy," India Quarterly: A Journal of International Affairs, , vol. 74(4), pages 402-419, December.
  • Handle: RePEc:sae:indqtr:v:74:y:2018:i:4:p:402-419
    DOI: 10.1177/0974928418802074
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    References listed on IDEAS

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    1. Philip R. Lane & Gian Maria Milesi-Ferretti, 2009. "Where Did All the Borrowing Go? A Forensic Analysis of the U.S. External Position," NBER Chapters, in: Financial Globalization, 20th Anniversary Conference, NBER-TCER-CEPR, National Bureau of Economic Research, Inc.
    2. Richard Baldwin, 2016. "The World Trade Organization and the Future of Multilateralism," Journal of Economic Perspectives, American Economic Association, vol. 30(1), pages 95-116, Winter.
    3. Valentina Bruno & Hyun Song Shin, 2017. "Global Dollar Credit and Carry Trades: A Firm-Level Analysis," The Review of Financial Studies, Society for Financial Studies, vol. 30(3), pages 703-749.
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