Though not a work of “Chinese studies” in the narrow sense, this fascinating book is of great interest to scholars interested in China's evolving position within the global economy, as well as to those studying institutional theory in general. Standards are a pervasive phenomenon in the modern economy, yet they have received only limited scholarly attention. Of course, institutional economists have long argued that standards – like other economic institutions – exist because they lower transaction costs. But this leaves important questions unanswered: how do standards come about and which (or whose) standards prevail? Sociologist Amy A. Quark addresses these questions in an intriguing case, namely quality standards for cotton. The textile industry is at the heart of early industrialization, thus, this focus brings out very clearly the global rivalries involved in standardization. She adopts a theoretical framework distinguishing between situational, institutional and systemic levels or “plays of the game,” “rules of the game” and “the game itself” (pp. 8–9). The game, in her understanding, is the global capitalist system in which incumbents pursue preservation strategies regarding their own privileged position. Yet their projects of liberal market expansion are far from uncontested: they face both redirection strategies of challengers and protective strategies of marginalized actors within the system. These interactive dynamics characterize the struggle over three fundamental aspects of governance regarding cotton quality standards, namely defining quality, creating benchmark standards and settling related commercial disputes.
Applying this approach, Quark first analyses an earlier phase of globalization (c. 1870–1920s) under British domination, during which time US-based challengers partially succeeded in redirecting institutions governing transnational cotton trade. She demonstrates how innovations such as commodity futures trading necessitate the standardization of quality. Liverpool merchants, organized in the Liverpool Cotton Association (LCA), used their market power to establish a system of private authority over quality standards and related dispute settlement. This system came under threat with the rise of the US textile industry: as part of a state-building project, the US Department of Agriculture (USDA) established itself as a new player in standard setting. USDA's strategy involved a de-legitimization of private standard setting authority and building up a new scientific discipline – fibre science – as its own basis of legitimacy. The resulting hybrid institutional regime featured state standard setting, dispute settlement by private sector cotton associations and a role for state courts in enforcing these decisions. The second period under scrutiny covers the 1970s to late 1990s, a time in which the US led a project of market expansion with “uneven liberalization”: while the Multi-Fibre Agreement (MFA) aimed to protect the domestic textile industry through a quota system against competition from abroad, farm subsidies propped up US cotton exports to other countries. Against this backdrop USDA initiated a paradigm shift in cotton quality standards by introducing mechanized classification based on precise “scientific” measurements – albeit with indicators most suited for US textile manufacturers and biased against non-US cotton producers. At the same time, a concentration process led to the emergence of a handful of transnational merchant firms as the dominant force in cotton trade across borders, aided among other things by structural adjustment programmes under World Bank and IMF authority in major cotton producing developing countries. These merchants, through the LCA, achieved greater sway in dispute settlement regarding cotton quality.
Turning to the contemporary period, Quark identifies the establishment of the World Trade Organization (WTO) as a turning point. This is also where China comes to the fore: with its WTO accession in late 2001 and the end of textile quotas in early 2005, China's booming economy presented new challenges to the US-led system. Given its new status as the major cotton importing country, the Chinese government attempted to introduce its own quality standards for cotton imported from abroad. However, the USDA successfully blocked this initial challenge using the legal structures of the WTO. Undaunted, China for now focuses on achieving mastery of the existing quality standards including instrument-based testing, and even receives (reluctant) help from the USDA in this endeavour. However, China's mid-term goal is to develop “quality standards with Chinese characteristics” to replace existing ones. Therefore, the USDA recently changed tack to ensure US dominance through the setting of benchmark standards, thereby escalating the regulatory spiral. In the meantime, further Chinese challenges regarding the role of private authority in dispute settlement threaten to undermine the powerful position of transnational traders. Quark carefully dissects the strategies and counter-strategies of all sides involved in these three above-mentioned key governance tasks, which, furthermore, intersect with protection strategies of other players in Europe and in the developing world. Remaining institutional incongruities notwithstanding, China is not only on its way to successfully imitating the US-system of mechanized quality testing, but may also be able to redirect the whole architecture of cotton quality institutions. Whether these institutions will ultimately “switch tracks” is still an open question. But Quark's analysis clearly shows how the rivalries between US and Chinese economic interests combined with other axes of conflict (Brazil's WTO challenge against US cotton subsidies or West African cotton producers’ protection strategies) serve to explain institutional change within the current global political economy, and even of the system of global capitalism itself. Moreover, the strategies she highlights, such as a “scientization” of politics in order to seemingly depoliticize institutions, are likely to be of great value in analysing other cases. The book will be read with much interest by scholars of China's economy and international political economy.
