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Economic statecraft.

Economic Statecraft.

Economic Statecraft. By David A. Baldwin. Princeton, NJ, Princeton University Press, 1985. 409 pp. $12.50 (US), paper.

David Baldwin's aggressively scholarly book should become required reading for anyone making a serious study of economics as an instrument of international politics. Baldwin cites three main purposes in writing this book: (1) to submit the conventional wisdom--that economic instruments are poor instruments of statecraft--to critical review; (2) to stimulate increased awareness of the many forms of economic statecraft; and (3) to develop an analytical framework within which the utility of economic instruments of policy can be discussed. Baldwin is successful to varying degrees at each of these tasks, but it is his excellent handling of the first that makes the book.

The conventional wisdom holds that "economic boycotts never work,' "economic "sticks' do not increase leverage and control over another nation,' "sanctions end up making the target country more self-sufficient and strengthening its resolve to continue its policies.' These statements are so categorical that one's first suspicion is that they must be, at the very least, overstatements. Indeed, Baldwin's secondary research indicates that close examination of existing case studies finds conflicting evaluations of the efficacy of economic statecraft. His reexamination of several cases widely cited in support of the conventional wisdom convinces the reader that even these "classic' cases are not the definitive evidence against economic statecraft they purport to be. The widely cited "failures' often reflect the analyst's evaluation of the ends of a particular policy, with the specific instruments of that policy fallaciously branded as "ineffective.' Baldwin dismisses this confusion of ends and means with the disdain such errors deserve. The perception of policy failure may also reflect an expectation that a narrow economic tool--usually a trade embargo--can be used to effect profound changes in the internal and external behavior of states. Baldwin extends the concept of economic statecraft to include a wider variety of sanctions and rewards and with respect to the conventional literature's preoccupation with single, sweeping goals, reminds the reader that "a given influence attempt may involve multiple goals and targets of varying generality and significance.'

Baldwin's third objective, introduction of the basic methods of social power analysis to the study of instruments of statecraft, is attempted in the second chapter. This is one of the weaker points in this work. I did not feel I came away from this chapter well enough briefed on "modern social power analysis' to meaningfully distinguish it from the simple application of generic critical analysis to the field of economic statecraft.

In the end, Baldwin's point is that economic statecraft is a far subtler discipline than the conventional, oversimplified cases suggest. Rather than ask, did a boycott get Castro to step down, or did an embargo drive Israel to abolish itself, a foreign policy analyst might have to be content asking if costs were imposed by one nation for another's noncompliance with relatively modest policy goals. The important question is whether foreign policy is well served by economic instruments in an environment where, as Baldwin sums up, "targets and goals are usually multiple,' "success is usually a matter of degree,' "alternatives matter,' and "the bases of power are many and varied.' Given that the most frequently cited alternatives to economic instruments are military adventures, every serious foreign policy analyst should read Economic Statecraft.
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Author:Devens, Richard M., Jr.
Publication:Monthly Labor Review
Article Type:Book Review
Date:Jun 1, 1986
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