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Reluctant Partners: A History of Multilateral Trade Cooperation, 1850-2000
Published by EH.NET (September 2004)
Andrew Brown, Reluctant Partners: A History of Multilateral Trade Cooperation, 1850-2000. Ann Arbor: University of Michigan Press, 2003. xiii + 254 pp. $49.50 (hardcover), ISBN: 0-472-11305-4.
Reviewed for EH.NET by Susan Ariel Aaronson, Kenan Institute, Kenan Flagler Business School, University of North Carolina.
As this review was written, the Doha Round continues to dither along. After three years of talking about the scope and purview of what they should talk about, the 147 nations of the WTO, finally developed a framework for their talks. One has to wonder why so many nations spend so much time talking about how to talk about trade liberalization.
Economist Andrew Brown has written this book to explain why nations put so much effort into multilateral trade talks. He believes countries have learned "that the material benefit from cooperation can make it worthwhile to rein in their Hobbesian mistrust of other countries. The key has been the recognition of their mutuality of interest" (p. 2). He notes "the advance in trade cooperation has been the story of the gradual liberation of countries from the tyranny of precise equivalence in the interpretation of reciprocity" (p. 37-38). Brown defines trade cooperation as "the resolution of conflicting interests in a mutually advantageous way." He then describes operating principles of reciprocity, nondiscrimination, and national treatment as essential tools to help policymakers achieve the cooperation nations want.
Brown's book examines the last one hundred years of trade policy and sees a pattern of ever greater trade cooperation. That is what's visible, but what's visible is not the whole story. The system and institution that encouraged multinational trade liberalization -- the GATT/WTO -- seems to be showing its age. While it worked well through the Uruguay Round, increasingly, nations are turning to bilateral trade agreements to achieve their international objectives. As evidence, both the U.S. and the EU are enthusiastically pursuing bilateral free trade agreements in many regions of the world. (In 2004 alone, the U.S. has negotiated some 14 of these agreements.)
Brown's strategy for the book is problematic. He cites no primary sources for his evidence. He did not look, for example, at Department of State or U.S. Trade Representative files from the U.S. Archives (now available for the Tokyo Round) to root his theories. He relies on outdated definitions. For example, he says trade policy and commercial policy are the same thing (p. 4) but trade policy includes the key barriers to trade today -- national regulations, competition policy, etc. Commercial policies simply include traditional barriers to trade such as tariffs and quotas. While these barriers remain important, one can't examine multinational trade cooperation without discussing both. It is not until p.195 that he discusses some of these concerns, which he concludes should not be pursued through trade policy. But he doesn't really address why these concerns seem to so frequently intersect with trade policy and how they can be addressed outside of the multilateral trade regime. Finally, the book promises to be a history of multilateral trade cooperation, but it is very U.S. centric. He never discusses the debate over multilateralism in Brazil, China, or France, as example, so that we can understand if these nations are as reluctant or as enthusiastic as the U.S. to partner in trade.
Brown has read widely and cited a wide range of secondary sources, but again his sources and writing focus on the U.S., which may have resulted in a very U.S. neoclassical perspective on multilateral trade cooperation. The analysis would have been deepened by scholars such as Amartya Sen; Kimberley Ann Elliot, Jeff Schott, David Vogel, Alfred Eckes and the more recent edition of I. M. Destler's magisterial study of U.S. trade policymaking trade liberalization: American Trade Politics: System under Stress. He tends to skirt over challenges to multilateral trade cooperation developed in the U.S. In recent years, the U.S. has demanded that its trade partners reduce real or imagined barriers to U.S. exports and investment, with the threat of retaliation of under Section 301, special 301 and super 301. Although these strategies are discussed on pp. 125-129, his examination of multinational trade cooperation seems simplistic. One can argue that the threat of unilateralism is a powerful incentive towards greater multinational trade cooperation, just as some analysts see America's use of bilateral free trade agreements as a tool to prod reluctant multilateralists to make better deals at the WTO. But they can also illuminate a weaker commitment to multilateral trade cooperation -- a thesis that Brown never discusses.
Brown's discussion of "the developing countries," in chapter 8 is especially simplistic. I am not sure if he is including middle income countries or countries such as China and India which have not only commodities but highly skilled workers and high-tech high-value goods to trade. The analysis again relies totally on secondary sources -- and very few are cited in the footnotes. He states that the developing countries became more oriented towards market opening policies as a result of financial crises and dissatisfaction with state-oriented trade policies. He ignores the role that declining foreign aid funds, IMF and IBRD policies played in moving countries towards greater openness. He never utilizes the perspective of developing country officials or scholars. Brown concludes "a multilateral trade regime ... that constrained ... the opportunistic behavior of the more powerful countries was distinctly attractive to them" (p. 147). But what alternatives were available to these countries given the growing importance of trade and the decline of official aid?
The best chapter of the book is the final chapter, which is much broader in its analysis. Brown here is thoughtful about the challenges to multilateralism in the twenty-first century. But major developing country trading nations Brazil and China have taken on the role of supportive leaders of multilateralism. That is a reason to be optimistic about the future of a multilateral cooperative strategy. In this chapter, Brown does not take on the potential and inadequacies of the WTO as the main institution to foster multilateral trade liberalization. The WTO has proven itself flexible and transparent. Its leadership and staff have worked hard to explain its actions to the citizens of its member governments. But 147 countries may be simply too many countries. Brown notes multilateral trade cooperation has endured because of pragmatism. But pragmatism may lead many WTO members to broker deals with their most important trading partners first. The twenty-first century may prove multilateral trade negotiation outdated -- at least under the aegis of the WTO.
Susan Ariel Aaronson is author of Taking Trade to the Streets: The Lost History of Public Efforts to Shape Globalization (University of Michigan Press, 2001).