Reconstructing the World Trade Organization for the 21st Century: An Institutional Approach

321 Pages·2015·2.261 MB·English

by  Kent Jones

Reconstructing the World Trade
Organization for the 21st Century

Reconstructing the World
Trade Organization for
the 21st Century
An Institutional Approach
KENT JONES
1
1
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Library of Congress Cataloging-in-Publication Data
Jones, Kent Albert.
Reconstructing the World Trade Organization for the 21st century : an institutional approach / Kent Jones.
pages cm
Includes bibliographical references and index.
ISBN 978-0-19-936604-0 (alk. paper)
1. World Trade Organization. 2. Free trade. 3. International trade. 4. International economic
relations. I. Title.
HF1385.J669 2015
382'.92—dc23
2014024773
1 3 5 7 9 8 6 4 2
Printed in the United States of America
on acid-free paper
For Ana-Lisa and Diantha

CONTENTS
Acknowledgments xi
Abbreviations xiii
Introduction: Why Isn’t There More Trade? xv
1. The Doha Round: What Went Wrong and What Is at Stake? 1
Introduction 1
The Doha Debacle 2
What Went Wrong at the Doha Round? 5
At Stake: A Framework for Future Trade Negotiations 9
What New Gains from Trade Are Available? 10
Protectionism during the Financial Crisis 17
Summary 20
2. Institutional Foundations of the GATT/WTO System 22
Introduction 22
The Institutional Roots of Trade Relations: Exchange and Conflict 24
The GATT/WTO System as an Institution 29
Birth of an Institution 29
Institutional Structure of the GATT 31
The GATT/WTO System: Elements of a Constructivist Approach 33
Path Dependency, Context, and Embeddedness of the
GATT/WTO System 39
Institutional Equilibrium and Adjustment in the GATT 43
Treatment of Developing Countries: The Great Inconsistency 48
Summary 49
3. The GATT to WTO Transition and Institutional Crisis in the
Doha Round 51
Introduction 51
The Genesis of the WTO 52
Incremental Institutional Change and Equilibrium 55
Challenges to Institutional Equilibrium: The WTO and the Doha Round 58
The Single Undertaking and New Product Areas 59
viii Contents
TRIPS and Developing Country Participation 61
Judicialization of Trade Agreements 63
Other Institutional Shocks 65
Remedies? An Institutional Approach 72
Summary and Conclusion 80
4. Impediments to Doha Round Consensus and the Search for
WTO Solutions 82
Introduction 82
WTO Decision-Making and the Principle of Consensus 83
Informal Processes of Decision-Making 85
The Legacy of the Uruguay Round 87
Bargaining in Changing Global Trade Environment 88
Evolution of the Decision-Making Process 95
The Role of the Director-General 97
The Problems with Ministerial Conferences 100
Possible Internal WTO Remedies 103
Critical Mass 104
WTO Salvation through Plurilaterals? 108
WTO Governance and Decision-Making 112
Summary: WTO Consensus as an Institutional Problem 113
5. WTO Governance and Committee Chair Representation 115
Introduction 115
Institutional Microstructure of the WTO 116
The Structure of WTO Committees 118
Developing Country Discontent 120
Ministerial Chairs and the Director-General 121
Aggregate Trends and Determinants of Committee Chairs 124
A Human Capital Hypothesis of Committee Chair Selection 129
Patterns of Chair Representation Using Aggregate Data 131
Probit Results 135
Determinants of Mission Size 140
Multiple Appointments 145
Summary and Conclusion 152
Appendix: Rosters of Country Groupings 154
6. Regional vs. Multilateral Trade Liberalization 157
Introduction 157
The Role of RTAs in the GATT/WTO System 158
Types of RTAs and Their Recent Proliferation 158
Contents ix
Early GATT History 162
Economic and Systemic Effects 164
Impact on Multilateral Trade Negotiations 166
Supply Chains, BITs, and the Advent of the “New” RTAs 169
Closing the Institutional Loop: From RTAs to the WTO 172
The Major Post-Doha RTA Negotiations 175
The Trans-Pacific Partnership 175
The US-EU Transatlantic Trade and Investment Partnership 180
Other RTA Negotiations 183
Summary: The Instrumental Role of RTAs in the
GATT/WTO System 184
7. Trade, Embedded Liberalism, and Development 187
Introduction 187
Embedded Liberalism: The Conceptual Framework 189
Embedded Liberalism for Developed Countries in the
Twenty-first Century 193
The Development Divide over Trade 194
Aid-for-Trade as Embedded Liberalism? 200
The Coherence Problem in Delivering Aid-for-Trade 201
The Bali Agreement: A Breakthrough for Aid-for-Trade
Liberalization? 204
A Graphical Illustration of the Institutional Problem 208
Summary and Conclusion 210
8. Pathways Back to Geneva 213
Gambling at the Tahoe Round: A Fable 213
The Problem with Multilateral Trade Negotiations 215
RTAs: A Path Back to the WTO? 219
RTA-Induced Fragmentation? 225
Leadership and Domestic Adjustment 227
Managing the Issues: The Bali Ministerial 232
After Bali: Possible Pathways Back to Geneva 236
Why There Isn’t More Trade 239
Notes 245
Bibliography 267
Index 283