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297 Pages·1998·31.697 MB·English
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INTERNATIONAL POLITICAL ECONOMY SERIES General Editor: Timothy M. Shaw, Professor of Political Science and Inter national Development Studies, and Director of the Centre for Foreign Policy Studies, Dalhousie University, Halifax, Nova Scotia Recent titles include: Pradeep Agrawal, Subir V. Gokarn, Veena Mishra, Kirit S. Parikh and Kunal Sen ECONOMIC RESTRUCTURING IN EAST ASIA AND INDIA: Perspectives on Policy Reform Deborah Brautigam CHINESE AID AND AFRICAN DEVELOPMENT: Exporting Green Revolution Steve Chan, Cal Clark and Danny Lam (editors) BEYOND THE DEVELOPMENTAL STATE: East Asia's Political Economies Reconsidered Jennifer Clapp ADJUSTMENT AND AGRICULTURE IN AFRICA: Farmers, the State and the World Bank in Guinea Robert W. Cox (editor) THE NEW REALISM: Perspectives on Multilateralism and World Order Ann Denholm Crosby DILEMMAS IN DEFENCE DECISION-MAKING: Constructing Canada's Role in NORAD, 1958-96 Diane Ethier ECONOMIC ADJUSTMENT IN NEW DEMOCRACIES: Lessons from Southern Europe Stephen Gill (editor) GLOBALIZATION, DEMOCRATIZATION AND MULTILATERALISM Jeffrey Henderson (editor), assisted by Karoly Balaton and Gyorgy Lengyel INDUSTRIAL TRANSFORMATION IN EASTERN EUROPE IN THE LIGHT OF THE EAST ASIAN EXPERIENCE Jacques Hersh and Johannes Dragsbaek Schmidt (editors) THE AFTERMATH OF 'REAL EXISTING SOCIALISM' IN EASTERN EUROPE, Volume 1: Between Western Europe and East Asia David Hulme and Michael Edwards (editors) NGOs, STATES AND DONORS: Too Close for Comfort? Staffan Lindberg and Ami Sverrisson (editors) SOCIAL MOVEMENTS IN DEVELOPMENT: The Challenge of Globalization and Democratization Anne Lorentzen and Marianne Rostgaard (editors) THE AFTERMATH OF 'REAL EXISTING SOCIALISM' IN EASTERN EUROPE, Volume 2: People and Technology in the Process of Transition Stephen D. McDowell GLOBALIZATION, LIBERALIZATION AND POLICY CHANGE: A Political Economy of India's Communications Sector Juan Antonio Morales and Gary McMahon (editors) ECONOMIC POLICY AND THE TRANSITION TO DEMOCRACY: The Latin American Experience Ted Schrecker (editor) SURVIVING GLOBALISM: The Social and Environmental Challenges Ann Seidman, Robert B. Seidman and Janice Payne (editors) LEGISLATIVE DRAFfING FOR MARKET REFORM: Some Lessons from China Caroline Thomas and Peter Wilkin (editors) GLOBALIZATION AND THE SOUTH Kenneth P. Thomas CAPITAL BEYOND BORDERS: States and Firms in the Auto Industry, 1960--94 Geoffrey R. D. Underhill (editor) THE NEW WORLD ORDER IN INTERNATIONAL FINANCE Henry Veltmeyer, James Petras and Steve Vieux NEOLIBERALISM AND CLASS CONFLICT IN LATIN AMERICA: A Comparative Perspective on the Political Economy of Structural Adjustment Robert Wolfe FARM WARS: The Political Economy of Agriculture and the International Trade Regime International Political Economy Series Series Standing Order ISBN 978-0-333-71110-1 (outside North America only) You can receive future titles in this series as they are published by placing a standing order. Please contact your bookseller or, in case of difficulty, write to us at the address below with your name and address, the title of the series and the ISBN quoted above. Customer Services Department, Macmillan Distribution Ltd Houndmills, Basingstoke, Hampshire R021 6XS, England Industrial Crisis and the Open Economy Politics, Global Trade and the Textile Industry in the Advanced Economies Geoffrey R. D . Underhill Professor of International Governance University ofA msterdam and Lecturer in International Political Economy University of Warwick First published in Great Britain 1998 by MACMILLAN PRESS LTD Houndmills, Basingstoke, Hampshire RG21 6XS and London Companies and representatives throughout the world A catalogue record for this book is available from the British Library. ISBN 978-1-349-26905-1 ISBN 978-1-349-26903-7 (eBook) DOI 10.1007/978-1-349-26903-7 First published in the United States of America 1998 by ST. MARTIN'S PRESS, INC., Scholarly and Reference Division, 175 Fifth Avenue, New York, N.Y. 10010 ISBN 978-0-312-21594-1 Library of Congress Cataloging-in-Publication Data Underhill, Geoffrey R. D. Industrial crisis and the open economy: politics, global trade, and the textile industry in the advanced economies I Geoffrey R.D. Underhill. p. cm. - (International political economy series) Includes bibliographical references and index. ISBN978-0-312-21594-1 (cloth) 1. Textile industry. 2. International trade. I. Title. II. Series. HD9850.5.U53 1998 338.4'7677-DC2l 98-17294 CIP © Geoffrey R. D. Underhill 1998 Softcover reprint oft he hardcover 1s t edition 1998 All rights reserved. No reproduction, copy or transmission of this publication may be made without written pennission. No paragraph of this publication may be reproduced, copied or transmitted save with written permission or in accordance with the provisions of the Copyright, Designs and Patents Act 1988, or under the tenns of any licence pennitting limited copying issued by the Copyright Licensing Agency, 90 Tottenham Court Road, London WIP 9HE. Any person who does any unauthorised act in relation to this publication may be liable to criminal prosecution and civil claims for damages. The author has asserted his right to be identified as the author of this work in accordance with the Copyright, Designs and Patents Act 1988. This book is printed on paper suitable for recycling and made from fully managed and sustained forest sources. 10987654321 07 06 05 04 03 02 01 00 99 98 To Magdalena Contents List of Tables IX Preface and Acknowledgements Xl List of Abbreviations XVll Introduction 1 Focus of the Study 2 The Arguments: The Political Economy of Trade Liberalisation 6 Implications for Theory 18 Structure of the Book 25 1 Material Underpinnings: Economic Structure and Industrial Crisis, 1974-84 33 Economic Dimensions of the Sector: Complexity and Fragmentation 34 Decline and Adjustment in the Textile and Clothing Sector 40 Global Competition and Production Costs: The 'Competitive Equation' in Textile and Clothing Industries 47 Conclusion 61 2 International Competition, Domestic Industrial Crisis, and the Strategies of Firms 70 International Trade and Industrial Adjustment 72 The Textile Problematic: The French Case 74 Conclusion 94 3 State, Market Governance, and Particularistic Interests: The Political Economy of Capture 101 Textile and Clothing Interests: the US and UK 103 French Textile and Clothing Interests 109 Vll Vlll Contents Policy Issues and State-Industry Relations in France: The Political Economy of Capture 120 Flexible Specialisation and Associational Systems in the Italian Textile and Clothing Industry 136 Conclusion 142 4 Capturing the Global Trade Regime 153 From STA to MFA 157 The First MFA Agreement 160 Renewing the MFA: France, Transnational Capture, and the EU on the Offensive 165 Conclusion: The Fourth MFA 187 5 Dismantling Protectionism: The Political Economy of Liberalisation in the Uruguay Round 197 Firm Strategies and Changing Economic Structure: the Accelerating Globalisation of Textile and Clothing Production in the 1980s and Early 1990s 204 The 1986 MFA Renewal and the Uruguay Round Launch 221 Conclusion: State and Market in Global Textile Trade 252 Appendix: Uruguay Round Agreement on Textiles and Clothing 258 m ~~ List of Tables 1.1 Consumption of textile products in industrialised countries by final use, 1978 35 1.2 Evolution of textiles consumption in Western Europe by final use, 1970-9 35 1.3 Top ten textile and clothing firms in the EU, 1980 40 1.4 Domestic textile and clothing consumption by end-use in France, 1980 44 1.5 Evolution of world consumption of textile fibre types, 1958-78 49 1.6 Manufacturing costs, spinning, 1978 51 1.7 Manufacturing costs, weaving, 1978 52 1.8 Real growth rates of clothing and textile imports to the industrialised countries in Western Europe and North America, 1963-78 55 1.9 Changing shares held by competing suppliers of imports to industrialised countries of Western Europe and North America, 1963-78 56 1.10 Trends in import penetration and net trade balance of major industrial countries, 1970-80 58 2.1 Evolution of relative prices of textile products in France, 1960-80 83 5.1 Selected EU countries: shares of companies' turnover derived from own production and subcontracting, extra-EU and intra-EU, 1983-92 216 ix Preface and Acknowledgements The research project which lies behind this book was extensive, and as a result the book itself has undergone a number of metamorphoses. The project began in the early 1980s as a study of industrial adjust ment in France and Europe. The question I was posing in the research was an important one in those early stages of the globalisation process: what do states do, indeed what can states do, as their industrial structures become transnationalised? It seemed that states had lost to global markets a number of traditional instruments of policy at a time when, politically, they needed them more than ever. The last half of the 1970s had been years of acute industrial crisis, and the early 1980s proved worse. Firms became more multinational, trade patterns changed rapidly as a result of liberalisation policies, and company failures and job losses mounted. A world which had been relatively certain and had produced the most miraculous economic growth in history was clearly at an end. It seemed that states were faced with an economy which increasingly cut across traditional national borders, and yet the domestic political ramifications of industrial crisis were undiminished for state officials in search of policy responses to deal with the problems of unemploy ment, apparently perpetual industrial adjustment, and popular unrest at declining income growth. The way in which states came to terms with these immense problems, which unseated many governments, from the Labour Party in the UK (1979) through the coalition of the Right in France (1981) and the Social Democrats in Germany (1982) to the Liberal Party in Canada (1984), not to mention President Car ter's attempted Democratic revival in Washington (1976-80), is now history, but is worth repeating briefly. States began to choose radical market-oriented solutions, deliberately divesting themselves of both policy instruments and the day-to-day management of distributional conflict in their societies. Labour had to adjust to the new climate with less sympathy from governing coalitions, firms had to learn to survive without the institutionalised programmes of assistance which had been their crutches in the post-war period, and economic structures began to change rapidly in what was eventually labelled globalisation. Xl

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