State-firm bargaining at the subfederal level : the case of California's unitary tax
This thesis models negotiations over U.S. subfederal economic policies that conflict with international norms. It analyses a recent case of a U.S. state government bargaining with foreign entities over a subfederal economic regulation which violated international norms: California's system of worldwide combined unitary taxation. The thesis applies Stopford and Strange's framework of state-firm bargaining to the subfederal level by: 1) determining which actors were involved in lobbying to change a U.S. state economic policy which violated international norms, California's unitary tax method; 2) determining the actors' policy agendas; 3) determining the different types of political and economic assets each actor possessed, and how effectively the actors used these assets to achieve their policy agendas; 4) determining how effectively the actors used various channels of negotiation to influence California's policy, and; 5) determining the most effective uses of assets and negotiating channels, key initiatives which influenced the outcome of the policy debate. What happens when U.S. state economic regulations conflict with international norms. What capabilities do states possess to defend their regulations when bargaining in the international arena. This thesis will argue that in the case of California's unitary tax, the following hypotheses are valid: 1) Powerful U.S. states such as California can maintain regulatory standards at odds with federal and international norms. Growing global economic interdepence is not eliminating California's regulatory options, since the U.S. federal government often refuses to effectively constrain powerful states which violate federal and international norms. 2) U.S. state governments can bargain directly with foreign governments and multinational enterprises as actors in the international arena. As the international arena increasingly intrudes on the affairs of subfederal governments, the U.S. federal government will not always be the preeminent negotiating channel for international actors seeking to influence U.S. economic policies.