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Yueh, Linda --- "International Economic Law and Economic Growth" [2009] ELECD 394; in Yueh, Linda (ed), "The Law and Economics of Globalisation" (Edward Elgar Publishing, 2009)

Book Title: The Law and Economics of Globalisation

Editor(s): Yueh, Linda

Publisher: Edward Elgar Publishing

ISBN (hard cover): 9781845421953

Section: Chapter 12

Section Title: International Economic Law and Economic Growth

Author(s): Yueh, Linda

Number of pages: 20

Extract:

12. International economic law and
economic growth
Linda Yueh

INTRODUCTION

There are numerous ways in which the system of international economic law
affects models of economic growth and the course of economic development,
particularly for developing countries which have under-developed legal
systems and less influence than the developed countries which largely formu-
late those rules. The focus in the economics literature on the role of law and
institutions in fostering economic growth presage the importance of interna-
tional laws for economic growth (see for example, Acemoglu et al. 2005).
In some ways, the global legal structure has come to the fore with the
greater integration of the world economy since the early 1990s with the
re-emergence of China and India and the fall of Communism in Eastern
Europe and the former Soviet Union. In 1992, China's `open door' policy ­
whereby it opened its borders to international trade and investment ­ took
off; a year after India experienced a balance of payments crisis in 1991
which triggered a change from inwardly-focused to externally-oriented
growth. The early 1990s also marked the disintegration of the former
Soviet Union and the re-engagement of particularly Eastern Europe with
its European neighbours. The re-integration of these countries roughly
doubled the global labour force, raising it to some three billion people,
and thereby halving the world's capital-to-labour ratio.1 The implications
are manifold, including fuelling offshoring as multinational corporations
move operations to developing countries to take advantage of ...