The U.S.-China dispute over the Chinese currency issue has lasted more than a decade. During the U.S. mid-term elections in 2010, the issue has been increasingly linked with a U.S.-China trade war. This paper applies the two-level game approach to analyze the case of the Chinese currency dispute while focusing on the U.S. domestic factors advocating and opposing a trade war policy toward China. It concludes that a full-blown U.S.-China trade war is not likely to happen. |