Volume 20, Number 4 Article by Surendra Sundararajan December, 2008
The Subterranean Theatre of International Economic Stratagems and their Implications for Policymaking :
The economic history of the world, especially between the 16th and 20th centuries, was marked by the exploitation of colonies across the globe. With former colonies having established their independence after the second world war, military imperialism is considered anachronistic. Nations, however, continue to use trade and international economic relations in the pursuit of their national interest and in the last two decades. Strategic Trade Policy has evoked considerable interest among economists. Its focus is clearly defined, viz, trade policy that affects the outcome of strategic interactions between firms in an actual or potential international oligopoly. On the other hand, International Economic Stratagems (IES), as outlined in this paper, looks at the new stratagems of economic imperialism or the diverse collection of strategic devices that may be used by governments to retard the pace of economic development of other nations.
The new devices were born out of a changed worldview, viz, one of positive-sum games rather than the previously prevailing zero-sum games, which betrayed a beggar-thy-neighbour mentality. Thus, the stratagems are not overtly aggressive, quite the opposite in fact, but with the apparent intent of retarding the pace of economic development in the developing nations, so as to maintain the relative economic positions. The diverse set of strategies includes arms exports, subsidies and predatory gifting, capitalising on unresolved territorial issues, propaganda, economic and political dominance, manipulation and so on.
This paper presents an exposition of international economic stratagems as are described above and also explores some policy responses to selected stratagems, with a view to mitigating the effects of such devices.
Reprint No 08405
