Economic interdependence offers the potential for raising global welfare, but there is a fuzzy boundary between national interests and global objectives in the economic policy area. This paper examines the boundary area. It concludes that all international economic regimes must entail a mix of rules and discretion, and it considers the most appropriate weights to be given to rules and discretion.
“An order which is adhered to from motives of pure expediency is generally much less stable than one upheld on a purely customary basis. … But even this type of order is in turn much less stable than an order which enjoys the prestige of being considered binding or, as it may be expressed, of ‘legitimacy’.”
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