Skip to main content Accessibility help

We use cookies to distinguish you from other users and to provide you with a better experience on our websites. Close this message to accept cookies or find out how to manage your cookie settings.

Close cookie message
×
Hostname: page-component-cd9895bd7-7cvxr Total loading time: 0 Render date: 2024-12-27T21:17:42.337Z Has data issue: false hasContentIssue false

3 - Corporate Strategy in Times of Anti-Trade Sentiment

Current Challenges and Future Scenarios

from Part I - New and Old Challenges

Published online by Cambridge University Press:  05 August 2019

By
Jappe Eckhardt  and
Louise Curran
Edited by
Manfred Elsig ,
Michael Hahn  and
Gabriele Spilker
Manfred Elsig
Affiliation:
Universität Bern, Switzerland
Michael Hahn
Affiliation:
Universität Bern, Switzerland
Gabriele Spilker
Affiliation:
Universität Salzburg
Get access

Summary

Skepticism on the benefits of free trade and globalization has been on the rise in several Western economies, which poses major challenges to firms in these countries. In this chapter, we first explore the roots and the multiple faces of this backlash. We then discuss what we can learn from existing literature on corporate political activity (CPA) in such a changing context, where anti-globalization sentiment and the threat of trade protectionism have become a political reality. We also present findings from our study on the responses of trade-dependent companies to rising protectionism in the European Union. A key finding is that there is a high level of consensus among EU trade associations that trade protectionism is a threat and, although individual companies have been passive so far, trade associations had a mandate to lobby against it. Finally, we discuss how the engagement of trade-dependent firms may change depending on how the political context evolves by presenting three possible scenarios for the future.

Keywords

corporate political activitylobbyinganti-globalizationprotectionismEuropean Union
Type
Chapter
Information
The Shifting Landscape of Global Trade Governance
World Trade Forum
 , pp. 48 - 72
Publisher: Cambridge University Press
Print publication year: 2019

Access options

Get access to the full version of this content by using one of the access options below. (Log in options will check for institutional or personal access. Content may require purchase if you do not have access.)

References

Aguinis, H. 2011. “Organizational Responsibility: Doing Good and Doing Well,” In: Zedeck, S. (Ed.), APA Handbook of Industrial and Organizational Psychology (Vol. 3). Washington, DC: American Psychological Association, pp. 855–79.Google Scholar
Altenberg, P. 2017. “Protectionism in the 21st Century and Trade Barriers Faced by Firms,” In: ICC, 2017 Rethinking Trade and Finance. Paris: International Chamber of Commerce.Google Scholar
Auger, P., Burke, P., Devinney, T. M., and Louviere, J. J.. 2003. “What Will Consumers Pay for Social Product Features?” Journal of Business Ethics 42(3):281–304.CrossRefGoogle Scholar
Baker, A. 2005. “Who Wants to Globalize? Consumer Tastes and Labor Markets in a Theory of Trade Policy Beliefs,” American Journal of Political Science 49(4):924–38.Google Scholar
Baron, D. P. 1995. “Integrated Strategy: Market and Nonmarket Components,” California Management Review 37(2):47–65.Google Scholar
Bauer, M. 2016. Manufacturing Discontent: The Rise to Power of Anti-TTIP Groups, ECIPE Occasional Paper 2/2016. Brussels: European Centre for International Political Economy.Google Scholar
BBC. 2017. “The End of Globalisation,” Business Daily Podcast, www.bbc.co.uk/programmes/p056dl6g, accessed on 3 July 2017.Google Scholar
Belk, R., Devinney, T., and Eckhardt, G.. 2005. “Consumer Ethics Across Cultures,” Consumption Markets & Culture 8(3):275–89.CrossRefGoogle Scholar
Bernard, A. B., Jensen, J. B., and Schott, P. K.. 2009. “Importers, Exporters and Multinationals: A Portrait of Firms in the US that Trade Goods,” In Dunne, T., Jensen, J. B., and Roberts, M. (Eds) Producer Dynamics: New Evidence from Micro Data. Chicago: University of Chicago Press, pp. 513–52.Google Scholar
Bhagwati, J. N. 1989. Protectionism (Vol. 1). Cambridge, MA: MIT Press.Google Scholar
Bombardini, M., and Trebbi, F.. 2012. “Competition and Political Organization: Together or Alone in Lobbying for Trade Policy?” Journal of International Economics 87(1):18–26.Google Scholar
Brenton, P., and Pelkmans, J.. 1999. Global Trade and European Workers. Basingstoke: Macmillan Press Ltd.Google Scholar
Brook, D.A. 2005. “Meta-Strategic Lobbying: The 1998 Steel Imports Case,” Business and Politics 7(1):1–24.Google Scholar
CEC. 2008. Standard Eurobarometer 68. Brussels: European Commission. http://ec.europa.eu/commfrontoffice/publicopinion/archives/eb/eb68/eb68_en.htm, accessed on 18 May 2017.Google Scholar
CEC. 2010. International Trade Report. Special Eurobarometer Report 357. Brussels: European Commission. http://ec.europa.eu/commfrontoffice/publicopinion/archives/ebs/ebs_357_en.pdf, accessed on 18 May 2017.Google Scholar
CEC. 2012. Standard Eurobarometer 78, Brussels: European Commission. http://ec.europa.eu/commfrontoffice/publicopinion/archives/eb/eb78/eb78_first_en.pdf, accessed on 16 October 2018.Google Scholar
CEC. 2016. Standard Eurobarometer 86. Brussels: European Commission. http://data.europa.eu/euodp/en/data/dataset/S2137_86_2_STD86_ENG, accessed 18 May 2017.Google Scholar
Clarke, J., and Newman, J. 2017. “People in this Country Have Had Enough of Experts: Brexit and the Paradoxes of Populism,” Critical Policy Studies 11(1):101–16.CrossRefGoogle Scholar
Cline, W. R. 1997. Trade and Income Distribution. Washington, DC: Institute for International Economics.Google Scholar
Cuervo-Cazurrra, A., Mudambi, R., and Pedersen, T.. 2017. “Globalization: Rising Skepticism,” Global Strategy Journal 7(2):155–8.Google Scholar
Curran, L., and Eckhardt, J.. 2017. “Smoke Screen? The Globalization of Production, Transnational Lobbying and the International Political Economy of Plain Tobacco Packaging,” Review of International Political Economy 24(1):87–118.Google Scholar
Curran, L., and Eckhardt, J.. 2018. “Strategic Responses of Trade Dependent Firms to Rising Trade Protectionism,” Paper presented at Würzburg International Business Forum’s International Business Conference. May.Google Scholar
Curran, L., and Ng, L.. 2018. “Running Out of Steam on Emerging Markets? The Limits of MNE Firm-Specific Advantages in China,” Multinational Business Review 26(3):207–224. https://doi.org/10.1108/.CrossRefGoogle Scholar
De Backer, K., and Flaig, D.. 2017. “The Future of Global Value Chains: Business as Usual or ‘A New Normal’?,” OECD Science Technology and Innovation Policy Papers No. 41. Paris: OECD.Google Scholar
De Backer, K., et al. 2016. “Reshoring: Myth or Reality?,” OECD Science, Technology and Industry Policy Papers No. 27. Paris: OECD.Google Scholar
De Bièvre, D., and Eckhardt, J.. 2011. “Interest Groups and EU Anti-dumping Policy,” Journal of European Public Policy 18(3):339–60.Google Scholar
De Ville, F., and Siles-Brugge, G.. 2015. “The Transatlantic Trade and Investment Partnership and the Role of Computable General Equilibrium Modelling: An Exercise in ‘Managing Fictional Expectations,” New Political Economy 20(5):653–78.Google Scholar
Denslow, D., and Fullerton, T. M.. 1996. “Consumer Attitudes toward Trade Liberalization,” Applied Economic Letters 3:179–82.Google Scholar
Destler, I. M., Odell, J. S., and Elliott, K. A.. 1987. Anti-Protection: Changing Forces in United States Trade Politics. Washington, DC: Institute for International Economics.Google Scholar
Dowd, K. 2017. “A Trade Policy for a Brexited Britain,” IEA Discussion Paper No.85. London: Institute of Economic Affairs.Google Scholar
Dür, A. 2010. Protection for Exporters: Power and Discrimination in Transatlantic Trade Relations, 1930–2010. Ithaca, NY: Cornell University Press.Google Scholar
Eckhardt, J. 2011. “Firm Lobbying and EU Trade Policymaking: Reflections on the Anti-dumping Case against Chinese and Vietnamese Shoes (2005–2011),” Journal of World Trade 45(5):965–91.Google Scholar
Eckhardt, J. 2013. “EU Unilateral Trade Policy‐Making: What Role for Import‐Dependent Firms?” JCMS: Journal of Common Market Studies 51(6): 989–1005.Google Scholar
Eckhardt, J. 2015. Business Lobbying and Trade Governance: The Case of EU-China Relations. New York: Palgrave Macmillan.Google Scholar
Eckhardt, J., and de Bièvre, D.. 2015. “Boomerangs over Lac Leman: Transnational Lobbying and Foreign Venue Shopping in WTO Dispute Settlement,” World Trade Review 14(3):507–30.CrossRefGoogle Scholar
Egels-Zandén, N. 2014. “Revisiting Supplier Compliance with MNC Codes of Conduct: Recoupling Policy and Practice at Chinese Toy Suppliers,” Journal of Business Ethics 119(1):59–75.Google Scholar
Egels-Zandén, N., and Lindholm, H.. 2015. “Do Codes of Conduct Improve Worker Rights in Supply Chains? A study of Fair Wear Foundation,” Journal of Cleaner Production 107:31–40.Google Scholar
Evenett, S. J. 2014. “The Global Trade Disorder,” The 16th GTA Report. CEPR 63.Google Scholar
Evenett, S. J., and Fritz, J.. 2015. “The Tide Turns? Trade, Protectionism, and Slowing Global Growth,” Global Trade Alert Report no. 18. London: Centre for Economic Policy Research.Google Scholar
Evenett, S. J., and Fritz, J.. 2016. “Global Trade Plateaus,” Global Trade Alert Report no. 19. London: Centre for Economic Policy Research.Google Scholar
Evenett, S. J., and Fritz, J.. 2017. “Will Awe Trump Rules?” Global Trade Alert Report no. 21 London: Centre for Economic Policy Research.Google Scholar
Farrand, B. 2015. “Lobbying and Lawmaking in the European Union: The Development of Copyright Law and the Rejection of the Anti-Counterfeiting Trade Agreement,” Oxford Journal of Legal Studies 35(3):487–514.Google Scholar
Financial Times. 2018. “What Would a No-deal Brexit Mean for Your Finances?” 3 August 2018, available at: www.ft.com/content/d89459d2-9023-11e8-b639-7680cedcc421.Google Scholar
FN. 2017. Choisir La France. Paris: Front National.Google Scholar
Ghemawat, P. 2011. “The Cosmopolitan Corporation,” Harvard Business Review May 2011:92–99.Google Scholar
Gibbon, P., and Ponte, S.. 2005. Trading Down: Africa, Value Chains and the Global Economy. Philadelphia, PA: Temple University Press.Google Scholar
Gilligan, M. J. 1997. “Lobbying as a Private Good with Intra-industry Trade,” International Studies Quarterly 41(3):455–74.Google Scholar
Goodwin, M. J., and Heath, O.. 2016. “The 2016 Referendum, Brexit and the Left Behind: An Aggregate‐level Analysis of the Result,” The Political Quarterly 87(3):323–32.CrossRefGoogle Scholar
Haddad, M-P. 2017. “Revivez ‘Le Grand Débat’ avec les 11 Candidats,” Présidentielle 2017, RTL. 04/04/2017, www.rtl.fr/actu/politique/en-direct-election-presidentielle-2017-le-grand-debat-7787946201, accessed on 15 May 2017.Google Scholar
Hainmueller, J., and Hiscox, M. J.. 2006. “Learning to Love Globalization: Education and Individual Attitudes Toward International Trade,” International Organization 60(2):469–98.Google Scholar
Hillman, A. J., Keim, G. D., and Schuler, D.. 2004. “Corporate Political Activity: A Review and Research Agenda,” Journal of Management 30(6):837–57.Google Scholar
HMSO. 2017. The United Kingdom’s Exit from and New Partnership with the European Union, London: Her Majesty’s Stationary Office.Google Scholar
Horner, R., and Nadvi, K.. 2018. “Global Value Chains and the Rise of the Global South: Unpacking 21st Century Polycentric Trade,” Global Networks 18(2):207–37.CrossRefGoogle Scholar
Irwin, D. A. 1996. Against the Tide: An Intellectual History of Free Trade. Princeton, NJ: Princeton University Press.Google Scholar
Kasahara, H., and Lapham, B.. 2013. “Productivity and the Decision to Import and Export: Theory and Evidence,” Journal of International Economics 89(2):297–316.Google Scholar
Kobrin, S. J. 2017. “Bricks and Mortar in a Borderless World: Globalization, the Backlash, and the Multinational Enterprise,” Global Strategy Journal 7(2):159–71.Google Scholar
Kolk, A., and Curran, L.. 2017. “Contesting a Place in the Sun: On Ideologies in Foreign Markets and Liabilities of Origin,” Journal of Business Ethics 142(4):697–717.Google Scholar
Korski, D. 2016. “Why We Lost the Brexit Vote,” Politico, 20 October 2016, www.politico.eu/article/why-we-lost-the-brexit-vote-former-uk-prime-minister-david-cameron/, accessed on 20 October 2016.Google Scholar
Lawton, T., Lindeque, J., and McGuire, S.. 2009. “Multilateralism and the Multinational Enterprise,” Business and Politics 11(2):1–26.Google Scholar
Lindeque, J. P., and McGuire, S. M.. 2010. “Non-market Capabilities and the Prosecution of Trade Remedy Cases in the United States,” Journal of World Trade 44(4):903–30.CrossRefGoogle Scholar
Locke, R. M. 2013. “Lead Essay: Can Global Brands Create Just Supply Chains?” Boston Review, May/June.Google Scholar
Locke, R.M., Amanguel, M., and Mangla, A.. 2009. “Virtue Out of Necessity: Compliance, Commitment, and the Improvement of Labor Standards,” Politics & Society 37(3):319–51.Google Scholar
Locke, R. M., Rissing, B., and Timea, P.. 2013. “Complements or Substitutes? Private Codes, State Regulation and the Enforcement of Labour Standards in Global Supply Chains,” British Journal of Industrial Relations 51(3):519–52.Google Scholar
Lund-Thomsen, P., and Lindgreen, A.. 2014. “Corporate Social Responsibility in Global Value Chains: Where Are We Now and Where Are We Going?” Journal of Business Ethics 123(1):11–22.CrossRefGoogle Scholar
Madeira, M. A. 2016. “New Trade, New Politics: Intra-industry Trade and Domestic Political Coalitions,” Review of International Political Economy 23(4):677–711.Google Scholar
Mansfield, E. D., and Mutz, D. C.. 2009. “Support for Free Trade: Self-interest, Sociotropic Politics, and Out-group Anxiety,” International Organization 63(3):425–57.Google Scholar
Mansfield, E. D., and Mutz, D. C.. 2013. “US versus Them: Mass Attitudes toward Offshore Outsourcing,” World Politics 65(4):571–608.Google Scholar
Mansfield, E. D., Mutz, D. C., and Silver, L. R.. 2015. “Men, Women, Trade, and Free Markets,” International Studies Quarterly 59(2):303–15.Google Scholar
Marks, S. 2016. “Canadian Minister: EU Talks Have Failed,” Politico, 21 October 2016, www.politico.eu/article/canadian-minister-says-eu-trade-talks-have-failed/, accessed on 16 May 2017.Google Scholar
Martin, H.-P., and Schumann, H.. 1997. The Global Trap: Globalization and the Assault on Prosperity and Democracy. London: Zed Books.Google Scholar
May, T. 2017. “PM Theresa May’s Brexit Speech,” Lancester House, London, 17 January 2017, www.gov.uk/government/speeches/the-governments-negotiating-objectives-for-exiting-the-eu-pm-speech, accessed on 20 January 2017.Google Scholar
Mayda, A. M. 2008. “Why Are People More Pro-trade Than Pro-migration?,” Economics Letters 101(3):160–3.Google Scholar
Mayda, A. M., and Rodrik, D.. 2005. “Why Are Some People (and Countries) More Protectionist Than Others?,” European Economic Review 49(6):1393–430.Google Scholar
Nadvi, K., and Raj-Reichert, G.. 2015. “Governing Health and Safety at Lower Tiers of the Computer Industry Global Value Chain,” Regulation & Governance 9(3):243–58.Google Scholar
The New York Times. 1992, “The 1992 Campaign; Transcript of 2d TV Debate Between Bush, Clinton and Perot,” 16 October 1992, www.nytimes.com/1992/10/16/us/the-1992-campaign-transcript-of-2d-tv-debate-between-bush-clinton-and-perot.html?pagewanted=all.Google Scholar
The New York Times. 2018, “Mr. Trump’s Tariffs Will Not Bring Back Manufacturing Jobs,” 23 January 2018, www.nytimes.com/2018/01/23/opinion/trumps-tariffs-manufacturing-jobs.html.Google Scholar
Osgood, I. 2017. “Industrial Fragmentation over Trade: The Role of Variation in Global Engagement,” International Studies Quarterly 61(3):642–59.Google Scholar
Rashish, P. S. 2017. US Trade Policy in the Age of Trump: What Role for Europe in the ‘New Nationalism’? Brussels: European Policy Centre.Google Scholar
Riisgaard, L., and Hammer, N.. 2011. “Prospects for Labour in Global Value Chains: Labour Standards in the Cut Flower and Banana Industries,” British Journal of Industrial Relations 49(1):168–90.Google Scholar
Rodrik, D. 2017. “Populism and the Economics of Globalization,” CEPR Discussion Paper DP12119, London: Centre for Economic Policy Research.Google Scholar
Rugman, A., and Verbeke, A.. 1989. “Trade Policy and Global Corporate Strategy,” Journal of Global Marketing 2 (3):1–18.CrossRefGoogle Scholar
Schmidt, V. A. 2017. “Britain-out and Trump-in: A Discursive Institutionalist Analysis of the British Referendum on the EU and the US Presidential Election,” Review of International Political Economy 24(2):248–69.Google Scholar
Schnietz, K. E., and Nieman, T.. 1999. “Politics Matter: The 1997 Derailment of Fast-Track Trade Authority,” Business and Politics 1(2):233–51.Google Scholar
Schrempf-Stirling, J., and Guido Palazzo, G.. 2016. “Upstream Corporate Social Responsibility: The Evolution from Contract Responsibility to Full Producer Responsibility,” Business & Society 55(4):491–527.Google Scholar
Schuler, D. A., and Rehbein, K.. 2011. “Determinants of Access to Legislative and Executive Branch Officials: Business Firms and Trade Policymaking in the U.S.,” Business and Politics 13 (3):1–30.Google Scholar
Solis, M. 2013. “Business Advocacy in Asian PTAs: A Model of Selective Corporate Lobbying with Evidence from Japan,” Business and Politics 15(1):87–116.Google Scholar
Taplin, I. M. 2014. “Who Is to Blame? A Re-examination of Fast Fashion after the 2013 Factory Disaster in Bangladesh,” Critical Perspectives on International Business 10(1/2):72–83.Google Scholar
Thacker, S. C. 2000. “Private Sector Trade Politics in Mexico,” Business and Politics 2 (2):161–87.Google Scholar
VanGrasstek, C. 2016. “What Will Happen to U.S. Trade Policy When Trump Runs the Zoo?,” ECIPE Occasional Paper, 03/2016. Brussels: European Centre for International Political Economy.Google Scholar
Walley, C. J. 2017. “Trump’s Election and the ‘White Working Class’: What We Missed,” American Ethnologist 44(2):231–6.Google Scholar
World Bank. 2002. “Globalization, Growth and Poverty,” Washington, DC: The World Bank.Google Scholar
Yildirim, A. B., Chatagnier, J. T., Poletti, A., and De Bièvre, D.. 2018. “The Internationalization of Production and the Politics of Compliance in WTO Disputes,” The Review of International Organizations 13(1):49–75.Google Scholar

Save book to Kindle

To save this book to your Kindle, first ensure no-reply@cambridge.org is added to your Approved Personal Document E-mail List under your Personal Document Settings on the Manage Your Content and Devices page of your Amazon account. Then enter the ‘name’ part of your Kindle email address below. Find out more about saving to your Kindle.

Note you can select to save to either the @free.kindle.com or @kindle.com variations. ‘@free.kindle.com’ emails are free but can only be saved to your device when it is connected to wi-fi. ‘@kindle.com’ emails can be delivered even when you are not connected to wi-fi, but note that service fees apply.

Find out more about the Kindle Personal Document Service.

Available formats
×

Save book to Dropbox

To save content items to your account, please confirm that you agree to abide by our usage policies. If this is the first time you use this feature, you will be asked to authorise Cambridge Core to connect with your account. Find out more about saving content to Dropbox.

Available formats
×

Save book to Google Drive

To save content items to your account, please confirm that you agree to abide by our usage policies. If this is the first time you use this feature, you will be asked to authorise Cambridge Core to connect with your account. Find out more about saving content to Google Drive.

Available formats
×