State Trading in International Markets: Theory and Practice of Industrialized and Developing Countries

318 Pages·1982·30.531 MB·English

by  M. M. Kostecki (eds.)

STATE TRADING IN INTERNATIONAL MARKETS
State trading is most frequently associated with exports and imports of
the COMECON countries. However, state trading by the developing
and industrialized countries accounts for an even more significant
portion of international trade than that generated by the COMECON
countries. This 'western' state trading is seen to be gaining in impor
tance and it is surprising that so little has been written by economists
and others on the subject.
This book on state trading in developing and industrialized countries is
a collection of papers dealing with some of the essential problems of
state trading from the perspective of international commodity
markets, international trade theory, economic development and inter
national trade order. Such a diversity of aspects, which had to be
necessarily considered in order to assess state trading, called for a
multi-disciplinary team of scholars. This team, therefore, enables the
study to take stock of the thinking on state trading and to attempt
policy recommendations taking into account not only economic but
managerial, legal and political aspects as well.
The study identifies, first, the essential mechanics of state trading in
developing and industrialized countries, examines considerations
motivating the maintenance of state trading operations, and assesses
their importance by country and by commodity groups.
A special effort is made to unify economic analysis with institutional
interactions (government contracts, plan targets, managerial con
straints, political pressures, etc.). In a wider perspective, an assess
ment can be made as to whether specific state-trading techniques are
first-, second- or third-best devices to achieve a given set of external
and/or internal objectives.
The analysis of state trading in international commodity markets
concludes with an assessment of the advantages and disadvantages of
state trading for producer and consumer countries. Particular atten
tion is paid to state trading as a means of assuring developing countries
access to foreign markets in a number of commodities, given the
structural adjustment problems that exist in the major developed
countries.
M. M. Kostecki, the editor, is Associate Professor of Economics at
the Ecole des Hautes Etudes Commerciales (HEC), University of
Montreal. His previous appointment was in the field of operations
research and mathematical economics at the University of Zurich. He
holds an MA in economics from the Central School of Planning and
Statistics in Warsaw and obtained his doctorate from the Graduate
Institute of International Studies, University of Geneva.
He is the author of East-West Trade and the GATT System and has
contributed articles to major journals of international economics and
commercial policy.
State Trading in
International Markets
Theory and Practice of Industrialized
and Developing Countries
Edited by
M. M. Kostecki
© M. M. Kostecki 1982
Softcover reprint of the hardcover I st edition 1982 978-0-333-30930-8
All rights reserved. No part of this publication may be
reproduced or transmitted, in any form or by any means,
without permission
First published 1982 by
THE MACMILLAN PRESS LTD
London and Basingstoke
Companies and representatives
throughout the world
ISBN 978-1-349-05889-1 ISBN 978-1-349-05887-7 (eBook)
DOI 10.1007/978-1-349-05887-7
Contents
The Contributors vii
List of Tables IX
List of Figures xi
Abbreviations XIII
Acknowledgements XV
INTRODUCTION
Raymond Vernon
STATE TRADING BY THE ADVANCED AND DEVELOPING
COUNTRIES: THE BACKGROUND 6
M. M. Kostecki
2 STATE TRADING IN AGRICULTURAL PRODUCTS BY THE
ADVANCED COUNTRIES 22
M. M. Kostecki
3 STATE TRADING IN GRAIN 55
Alex F. McCalla and Andrew Schmitz
4 THE ROLE OF STATE TRADING IN MINERAL
COMMODITY MARKETS 78
Walter C. Labys
5 STATE TRADING AND THE POLITICS OF OIL 103
0ystein Noreng
6 STATE TRADING AND THE THEORY OF
INTERNATIONAL TRADE 117
P. J. Lloyd
7 TRADE POLICY INSTRUMENTS, STATE TRADING AND
FIRST-BEST INTERVENTION 142
Harriet Matejka
v
vi Contents
8 STATE TRADING AND DOMESTIC DISTORTIONS IN A
MIXED WORLD ECONOMY 161
Klaus Stegemann
9 INCOME TAXATION OF STATE-TRADING ENTERPRISES 189
Robert H. Floyd
10 COOPERATION AMONGSTA TE-TRADING
0RGANIZAT IONS OF DEVELOPING COUNTRIES 210
Klaus Netter
11 EXPORT PERFORMANCE OF THE MARKETING BOARDS IN
LDCS-THE CASE OF COCOA AND COFFEE IN
WEST AFRICA 221
Jean-Emile Denis
12 STATE TRADING AND THE GATT 245
Ivan Bernier
13 STATE TRADING AND TRADE LIBERALIZATION 261
Frieder Roessler
Appendixes 285
Select Bibliography on State Trading 295
Index 301
The Contributors
Ivan Bernier
Professor of Law
Law Faculty
Laval University
Quebec
Jean-Emile Denis
Associate Professor of Business Administration
Ecole des Hautes Etudes Commerciales de Montreal
University of Montreal
Robert H. Floyd
Senior Economist
IMF
Washington
M. M. Kostecki
Associate Professor of Economics
Ecoles des Hautes Etudes Commerciales (HEC)
University of Montreal
Walter C. Labys
Professor of Economics
College of Mineral and Energy Resources
West Virginia University
Morgantown
P. J. Lloyd
Professor of Economics
Department of Economics
The Australian National University
Canberra
VII
viii The Contributors
Harriet Matejka
Associate Professor of Economics
Graduate Institute of International Studies
University of Geneva
Alex F. McCalla
Professor of Agricultural Economics
University of California
Davis
Klaus Netter
Senior Economic Affairs Officer
UNCTAD
Geneva
0ystein Noreng
Professor of Business Administration
Oslo Institute of Business Administration
Frieder Roessler
Senior Officer
GAIT Secretariat
Geneva
Andrew Schmitz
Professor of Agricultural and Resource Economics
University of California
Berkeley
Klaus Stegemann
Associate Professor of Economics
Department of Economics
Queen's University
Kingston
Raymond Vernon
Herbert F. Johnson Professor of International Business Management
Graduate School of Business Administration
Harvard University
List of Tables
2.1 Domestic output and state trading of rice in Japan
(1971--{)) 31
2.2 Wheat prices for export and home consumption practised
by the Australian Wheat Board ($US/ton) 36
3.1 The taxonomy of the grain trade 57
3.2 World trade in wheat: Sources and destinations weighted
averages 59
3.3 World trade in coarse grains: Sources and destinations
weighted averages 61
3.4 World wheat trade matrix -trading relationships and
actual trade 63
3.5 State trading in wheat-percentage of volume of
principal exporters accounted for by state traders 64
4.1 Copper: State-trading organizations 82
4.2 Ownership of copper companies (1976) 83
4.3 Tin: State-trading organizations 87
4.4 Ownership of tin smelting capacity (1976) 89
4.5 Bauxite: State-trading organizations 92
4.6 Ownership of bauxite mining capacity (1973) 93
4.7 Iron ore: State-trading organizations 97
4.8 Ownership of iron ore companies ( 1974) 98
5.1 Oil exports of OPEC countries by types of companies
(1978) 108
8.1 Comparison of situations depicted in Figure 8.2 179
11.1 Leading producers of cocoa beans 227
11.2 Leading exporters of cocoa beans 227
11.3 Cocoa: P;i for each country ( 1959-75) 228
11.4 P;i frequency distribution-cocoa 230
11.5 Xz test on P;i frequency distribution-cocoa 231
11.6 Regression of P;i for cocoa-values of coefficients, F and
RZ
232
11.7 Partial adjustment model-cocoa 233
11.8 Share in world coffee exports 235
11.9 Share in robusta exports 236
11.10 Robusta coffee: P;i for each country ( 1959-75) 237
ix