by Colin B. Picker, Isabella D. Bunn, and Douglas W. Arner (eds). Oxford, England and Portland, Oregon: Hart Publishing, 2008. 344pp. Paper: $60.00/£35.00. ISBN: 9781841137551.
Reviewed by Susan L. Karamanian, The George Washington University Law School. Skaramanian [at] law.gwu.edu.
INTERNATIONAL ECONOMIC LAW: THE STATE AND FUTURE OF THE DISCIPLINE is a collection of some of the papers presented at the 2006 meeting of the American Society of International Law’s International Economic Law Group (IELG). The 2006 meeting was held at Bretton Woods, New Hampshire, the birthplace in 1944 of what would become the post-war international financial and economic system. The conference organizers, Isabella D. Bunn of the University of Oxford and Colin B. Picker of the University of Missouri Kansas City, along with IELG leadership selected an iconic venue in an effort to inspire the participants. The festivities were held in the historic Mount Washington Hotel, the venue of the 1944 conference.
The focus of the 2006 IELG conference was not the likely one, the history of international trade and finance since 1944. Nor was it the second one that may come to immediate mind, the establishment of the three post-war economic pillars, the World Bank, the International Monetary Fund and the General Agreement on Tariffs and Trade (GATT), later the World Trade Organization (WTO), and the whirlwind of activity associated with each institution.
Instead, the meeting examined the current and future state of a relatively new discipline and what the discipline, understood in a broad sense, means for world order. The organizers pushed the participants to examine international economic law from a dynamic perspective with an emphasis on the future. Views from beyond Europe and the United States were presented, as were ones that added new twists, e.g., the feminist view (Tracey Epps and Rose Ann MacGillivray), the WTO and “opportunists” (Sara Dillon), and the domestic corporate law course as a forum for teaching international economic law (Franklin A. Gevurtz).
In addition to producing a conference with substantial scholarship as reflected in the papers, the IELG leadership had a more ambitious agenda – namely, to use the meeting to create a new, non-US based world forum dedicated to international economic law. True to the mission, the Society of International Economic Law (SIEL) was launched in Geneva, Switzerland in July 2008. SIEL is aimed at academics and academically-minded lawyers and officials, and expressly seeks members from “all parts of the world.” (See Society of International Economic Law available at http://sielnet.org.) [*943]
Bunn and Picker, along with Douglas W. Arner of the University of Hong Kong, edited the conference papers. The results of their efforts and those of the contributors are far more than just another account of trade and investment law with an inward, rigid or technical examination of institutions and the jurisprudence. This book is not a primer on international economic law. Also, the book may be of little use to the reader who is not interested in a critical assessment of the values and policy permeating the discipline. And, therein rests the work’s value, as quite often scholarship in the field gets bogged down in regulatory details without regard to the big picture and other disciplines.
Three chapters, research and scholarship, teaching, and practice/service, frame INTERNATIONAL ECONOMIC LAW. The treatment of these arguably narrow topics, however, is expansive at times. Many of the contributors examine the issues in depth and provide a variety of perspectives, which makes the book useful to an audience beyond the academy. Practitioners and officials of governments and international institutions who undertake their work without reflecting on its policy implications are apt to be blind-sided by the unexpected. This book, if studied closely, should enable the reader to anticipate and deal with the likely changes on the horizon.
Another of the collection’s strengths rests in the diversity of authors and subjects covered and the creativity and critical analysis many of them bring to the subject matter. The 21 contributors are from Europe, Asia, including the sub-continent, the Middle East, New Zealand, Canada and the United States. They are mainly academics, many with experience outside of the university setting, with a few practitioners. Most of the essays adeptly intertwine theory with real-world lessons.
The work’s subjects include an extensive treatment of how international economic law is studied, investigated, and analyzed, what makes it a discipline, its relationship to other disciplines, and the significance of this discussion beyond the discipline and the academy. Another recurring subject is the role of institutions, the WTO, IMF, World Bank, private corporations, and law faculties, in shaping, managing and responding to the discipline. Subjects such as international relations theory, economic theory, sociology, and public international law permeate the discussion on international trade, international banking, and international investment law.
Tomer Broude sets the stage for the book’s first chapter on research, as well as for the other two chapters on teaching and practice, by broadly and critically assessing the relevant landscape. According to Broude, the discipline’s roots, based on the theory that free markets lead to welfare maximization, manifest themselves through the pragmatic liberalism driving the important and essential work of John Jackson and his Michigan school. Yet, the theory may not adequately explain what has happened in practice, as Broude looks to the works of others who have questioned whether the multilateral and bilateral trade regimes have enhanced welfare. His point is not that the theory was wrong from the outset but that something is missing, mainly the [*944] “extra legal” tools to understand and explain.
Gregory Shaffer, Joel P. Trachtman and Andrew Lang respond to Broude by exploring research methods. Shaffer and Trachtman, in separate essays, call for empirical work with Shaffer arguing for a new legal realist approach to the discipline that would use both quantitative and qualitative methods. Both recognize that empirical work alone may not suffice, and it could and should be subjected to a healthy array of methodological criticism. Both admit, however, that serious empirical work would likely be illuminating and, for Shaffer at least, perhaps reshape predispositions. Lang draws on institutional theory within the discipline of sociology to make the same point, and he takes the next step by applying the reasoning and identifying specific research projects and objectives. For example, he makes the case that trade institutions are normative systems, and this, in turn, affects policy. His analysis reflects Shaffer’s plea for qualitative work, an effort that would examine who are the relevant actors, what motivates them when they act and with what result.
Other authors, namely Frederico and Matteo Ortino and Emmanuel Voyiakis, respond to Broude by examining the contours of international economic law. The Ortinos question the role of international law, and they effectively use case studies to prove their point. In their view, to understand cross-border transactions one must be grounded largely in municipal law and private legal instruments, including economic law. Voyiakis, on the other hand, argues thoughtfully about the relationship between WTO law and international law, re-defining and addressing the separatist argument. His essay pushes the reader to look beyond a simple characterization of the problem as one system of law versus another. Instead, the critical issue involves the values each system promotes, and the extent to which these values conflict.
The reasoning in the first chapter can be dense, at times, and its relevance may not be readily apparent to the lawyer in the trenches fighting one of the many daily international economic law battles, whether before the WTO, an international arbitral tribunal, or a municipal court. Yet, the issue of what is international economic law and how it should be studied, analyzed, and presented is important when considered outside of the academy. The lack of a clear understanding of the relevant sources of law and their effect, or at least an appreciation of the complexity of these issues, could result in irrelevant or misguided arguments and bad results.
The book’s second chapter, devoted to the teaching of international economic law, has a relatively narrow focus. Some of the essays, however, draw in broader themes beyond pedagogy. Epps and MacGillivray use empirical methods (data gathering based mainly on interviews and the review of (a) websites about law school faculty members and their teaching and publication records, (b) course enrollment records, and (c) international economic law journals) to establish “a real dearth of feminist perspectives in international economic law, which contrasts to public international law more generally” (p.169). They recognize and identify some of the women who have contributed scholarship to the field. An [*945] interesting focus, not developed but perhaps ripe for later work, would be to examine the role and influence of women trade negotiators who, through their position, have yielded substantial authority – e.g., Carla Hills, Charlene Barshefsky, and Susan Schwab (US Trade Representatives) and Mari Pangestu (Indonesia’s Minister of Trade). Have these women provided “fresh [feminist] insights” which would act “as a stimulus for growth and development” in the field (p.159)?
Frank Gevurtz and Constance Z. Wagner, in separate essays, examine the teaching of international economic law with a focus on corporate responsibility. Gevurtz documents how domestic corporate law imposes certain corporate social responsibility norms. In this and other respects, according to Gevurtz, the distinction between domestic corporate law and international economic law is not that clear. His analysis builds on his firmly-held belief, as reflected in other works, that disaggregating the international from the domestic can be counterproductive. Wagner, on the other hand, advocates a separate course or module on corporate responsibility in the international business transactions curriculum. Sandwiched between the contrasting essays of Gevurtz and Wagner is Seema Sapra’s discussion of teaching international economic law in India, a nation that has undergone substantial economic growth without a clear reform agenda. Sapra, like Gevurtz and Wagner, focuses on the appropriate vehicle for teaching the subject of international economic law, which she considers in a broad context, necessarily tied to domestic governance reform.
Gevurtz, Wagner, and Sapra offer cogent and reasonable arguments for their respective approaches, and none seems strident in his or her approach. Instead, they collectively offer their ideas for the readers’ taking, with Sapra’s of specific relevance to India.
The final chapter is devoted to the practice of international economic law. The essays in this chapter have a strong real-world dimension, which is a nice balance to the theory of the earlier chapters. Douglas Arner provides one of the book’s few overviews, a useful survey of international financial law. The analysis is prescient in its conclusion, as the current financial uncertainty evidences the lack of a crisis resolution mechanism. David A. Gantz documents Vietnam’s accession to the WTO and provides interesting and detailed insight into reforms of Vietnam’s domestic legal system. His work, in addition to being an important record of the accession process, takes on broader issues such as the long-term consequences of WTO membership.
A thought-provoking essay is submitted by Rumu Sarkar, who urges that the World Bank establish an appellate body within the bank, similar to the WTO institutional structure, to review certain decisions of the World Bank Inspection Panel (WBIP) arising out of a complaint by an affected party. At first blush the proposal is curious. Sarkar does not argue that the WBIP, which does not make legal findings, has made bad decisions. She acknowledges that a claim brought before the WBIP is based solely on the World Bank’s failure to follow its own internal guidelines, as opposed to a nation’s failure to follow a treaty. Hence, what is driving her [*946] effort? First, she relishes the development of international administrative law within the World Bank. Second, following the guiding principle of the WBIP, she argues for greater accountability and transparency within the World Bank through the appellate body. Her creative reasoning sets out a detailed draft protocol for an “appellate board” (which, she argues could also be established within the IMF). The unsettled issue, however, is whether there is a pressing need to add this legal dimension to the work of the WBIP.
Andrea Bjorklund’s essay on precedent and investor-state arbitration helps ease the transition from the previous chapters on research methods and teaching. Bjorklund combines legal formalism and a theoretical orientation in arguing that arbitral tribunals are establishing a modern international law of investment and they are doing so in a fairly disciplined manner, somewhat like courts’ reliance on precedent. The significance of her work goes beyond documenting this development, which is in itself important. Bjorklund also identifies various challenges to the process – e.g., the lack of formal rules for steering a tribunal to a particular prior decision, the lack of hierarchy in the tribunals, and the lack of defined ethical standards to guide arbitrators. Like many of the essays, Bjorklund’s contribution tees up a variety of issues for further examination.
The last essay, Andreas F. Lowenfeld’s submission on IMF conditionality, or what he calls the “jurisdiction to prescribe,” is a fitting final one. Lowenfeld targets issues addressed in some of the earlier essays – e.g., sovereignty, the narrowing distinction between international and domestic, and the international acceptance of certain practices. He sets out four proposed principles for the IMF and other international organizations in assessing the legitimacy of regulatory measures that cross national barriers. The proposed principles, measures of “reasonableness,” are consistent with the Restatement of the Foreign Relations Law of the United States’ standards for evaluating the law’s extraterritorial reach. Lowenfeld does not purport to give answers, but instead, as he has done ably over the years, he offers guidance and wisdom. For example, under his “mirror principle,” “[t]he more we would regard such a prescription as excessively intrusive, the less justification there is to break the jurisdictional barrier and prescribe it as a condition” (p.328, emphasis in original). He defines “we” as “first world nations such as the United States, Japan, the United Kingdom, the European Union or one of its prickly member states” (p.328). Ever cautious, Lowenfeld acknowledges the flexibility of the four proposed principles and the need to consider the economic pros and cons of most regulatory decisions.
Lowenfeld’s reasoning rings loudly when one considers the increased foreign investment in the United States, particularly from sovereign wealth funds, and the controversy associated with Dubai Ports World’s proposed acquisition in 2006 of the management of six US ports. Like some of the other authors in the book, he takes a pragmatic view of the issues. He is not wedded to inflexible notions of sovereignty when prudence dictates that a more studied and reasoned understanding of the [*947] world’s problems could bring relevant parties together to reach a better result.
INTERNATIONAL ECONOMIC LAW is a fitting tribute to the Bretton Woods international financial and economic system, with all of its complexities and challenges, and to all of those who have helped build and shape it. The work is necessary reading for the current and future generation of lawyers, policymakers, and scholars from around the world who are committed to maintaining the relevance and development of the discipline.
© Copyright 2008 by the author, Susan L. Karamanian.