The Two-level Games in China’s Foreign Trade Policies

Applying two-level game theory and rational decision-making analysis, this book explores how China navigates domestic constraints and international pressures to achieve optimal outcomes in its foreign trade policy. The author examines China’s accession to the WTO and the evolving trade tensions between China and the US. She analyzes some of the most contentious trade issues in the contemporary landscape, such as China’s economic model, technology restrictions, and non-tariff barriers. Through a case study on China’s solar photovoltaic (PV) manufacturing sector, she illustrates how these trade issues influence policy-making within a specific industry. In conclusion, the book evaluates China’s strategies for navigating its foreign trade within the broader global trading system – it considers the prospects for a potential "win-set" in future trade negotiations, offering insights into how China might navigate these complexities moving forward. The book will appeal to academics specializing in international trade law, international relations, and China studies.

Table of Contents:
1 Two Decades after China’s Accession to WTO 2 US-China Trade Tensions: A Comparative Analysis with US-Japan Trade Frictions 3 Challenges in the Interaction of Trade and Competition Policies 4 Trade Sanctions and Non-tariff Barriers 5 China’s Solar Photovoltaic Industry: A Case Study on Development, Policy, and Global Impact 6 China’s Strategies in Global Trade Governance: Towards Achieving a Win-set?

About the Author :
Zuozhen Liu is Associate Professor of Law whose research focuses on cultural heritage law, international trade law, and Chinese constitutional law. She holds a PhD in Art and Law from the University of Amsterdam and also practices law part-time. Dr. Liu serves as a legal consultation expert for local governments’ rule-of-law initiatives, with her policy reports earning repeated commendations from various departments. Her work bridges academic inquiry and legal practice, with a focus on the intersection of culture, law, and development.

Review :
“Seldom is a book published exactly when it is most needed. But that is exactly the case with Dr. Liu’s text, in which she offers a convincing model to explain China’s foreign policy decisions. The need for such a model has been heightened with the election of Donald Trump to the American presidency and his explosive return to the international stage. This can be seen in the increasingly tempestuous world of international trade. The focus of which has shifted significantly from a broad emphasis on globalization and free trade to a more fragmented system shaped by geopolitical tensions and economic competition. China’s resurgence is a perceived threat to the American-led “rules-based-order”. In response, the U.S. has increasingly adopted protectionist measures, such as tariffs, export controls, and restrictions on Chinese firms, while also seeking to reshore critical supply chains and strengthen alliances to counterbalance China's influence. This evolving dynamic reflects a broader shift toward economic nationalism, decoupling, and the weaponization of trade policy as tools of strategic rivalry between the two superpowers. But what was and will be China’s rejoinder? The answer is absolutely essential for companies, investors, strategists, and even the layperson wondering how to position their assets, which university to attend, and even what car, computer, or AI platform to use. This book provides us with the essential rubric to make sense of how decisions are made and how they will likely to be made. It is carefully researched, easy to read, and provides a thoughtful look at the interaction between domestic and international politics and its effect on policy choices.” Alexander Kocsis, Professor, School of Civil and Commercial Law, Beijing Institute of Technology “Whether viewed through the lens of economic policy or international political theory, domestic constraints exert a subtle yet far-reaching influence on a state's foreign policy, particularly in terms of its participation and division of labor within multilateral systems. Dr. Liu astutely captures this analytical perspective, which holds both practical and theoretical significance. Through a detailed and original "Two-level" analysis of China's foreign trade policy, she enables readers to gain a deeper, more nuanced understanding of China's strategies, policies, and behaviors following its WTO accession. The cases selected by Dr. Liu are particularly representative, reflecting China's efforts and breakthroughs in addressing the demand for high-quality economic development in recent years. In light of the profound transformations currently shaping the global economic order, Dr. Liu's latest work offers a timely and valuable new perspective, particularly regarding the evolving dynamics of major power trade relations.” Dr. Kai Jin, Senior Fellow, Center for American Studies of the Global Governance Institution (Beijing).