EH.net is owned and operated by the Economic History Association with the support of other sponsoring organizations.
Remaking U.S. Trade Policy: From Protectionism to Globalization
Published by EH.NET (January 2008)
Nitsan Chorev, Remaking U.S. Trade Policy: From Protectionism to Globalization. Ithaca: Cornell University Press, 2007. xii + 242 pp. $42.50 (cloth), ISBN: 978-0-8014-4575-0.
Reviewed for EH.NET by Douglas A. Irwin, Department of Economics, Dartmouth College.
In recent years, political scientists (such as I. M. Destler, Sharyn O'Halloran and Michael Hiscox), economists (Robert Baldwin), and historians (Alfred Eckes, Thomas Zeiler) have studied the shift in U.S. trade policy from high protective tariffs in the early twentieth century to lower tariffs and even "free trade" agreements in the late twentieth century. With this book, a sociologist, Nitsan Chorev (an assistant professor at Brown University), has now entered the fray.
In Remaking U.S. Trade Policy, Chorev argues that globalization did not arise simply because economic obstacles to greater integration in trade and finance eroded over time. Rather, there was an important political component to globalization because legislative and policy barriers to integration were systematically dismantled. Chorev argues that "advocates of free trade prevailed in the struggle with protectionists by manipulating the institutional arrangements governing trade policy formation and implementation, replacing institutional arrangements that favored protectionism with new ones that favor a more internationalist orientation."
Chorev identifies three such institutional shifts in U.S. trade policy since the early 1930s. First, the Reciprocal Trade Agreements Act of 1934, which eventually led to the General Agreement on Tariffs and Trade in 1947, introduced a period of what she calls "selective protectionism," i.e. a general reduction in trade barriers except for politically powerful import-sensitive sectors. Second, the Trade Act of 1974 strengthened the laws governing trade remedies under the jurisdiction of the executive branch and introduced a regime of "conditional protectionism," i.e., certain statutory requirements had to be met for firms to receive protection from imports. Third, the creation of the World Trade Organization in 1995 established a regime of "legalized multilateralism" wherein the trade policies of all countries operated under a single legal framework, complete with a judicial dispute settlement mechanism. Each of these institutional transformations shifted U.S. policy in the direction of more open trade: "each new institutional regime led to the further exclusion of protectionist voices from the process of decision making" and hence "today's protectionist sentiments pose little threat to the durability of economic globalization and the future expansion of economic practices."
The book is very well organized around these concepts. Chapters 1 and 2 outline the political basis for economic globalization. Chapter 3 examines selective protectionism during the 1934-1974 period. Chapter 4 deals with the origins of conditional protection, which characterized the period from 1974 to 1994 and is covered in chapter 5. Chapter 6 examines legalized multilateralism from 1994 to 2004.
The organizational triad of selective protectionism, conditional protectionism, and legalized multilateralism is a useful way of thinking about these periods. The book is a good introduction to this important policy shift (although not as exciting as Destler's American Trade Politics.) In the end, however, the book does not reveal much that is new to those familiar with these periods in trade policy history. While chapter 3 draws mainly on secondary sources, Chapter 4 (on the period just before 1974) brings out interesting new archival evidence on thinking about trade policy in the Nixon administration. In addition, Chapter 5 relies on archival evidence from the Ford and Carter administrations. While useful to specialists, the new archival evidence does not really change our understanding or interpretation of what trade policy was all about during these years.
The book is well written but does not depart from the standard storyline established by others. The greatest disappointment to this reader was the hope that the discipline of sociology might add a new perspective on the policy shift, which has been studied in detail by political scientists. While the story is nicely told, it does not appear that sociologists have any greater insight into (or any significantly different understanding of) this change than other academic disciplines. For example, Chorev depends upon political scientists such as Haggard (1988), O'Halloran (1994), Hiscox (1999), Schnietz (2000) and others who have studied the initial transformation brought about by the Reciprocal Trade Agreements Act of 1934 in great detail. Still, Chorev's book provides a good introduction for those wishing to understand the important changes in U.S. trade policy over the past seventy years.
Destler, I. M. 2005. American Trade Politics fourth edition. Washington, DC: Institute for International Economics.
Haggard, Stephan. 1988. "The Institutional Foundations of Hegemony: Explaining the Reciprocal Trade Agreements Act of 1934." International Organization 42: 91-119.
Hiscox, Michael J. 1999. "The Magic Bullet? The RTAA, Institutional Reform and Trade Liberalization." International Organization 53: 669-98.
O'Halloran, Sharyn. 1994. Politics, Process, and American Trade Policy. Ann Arbor: University of Michigan Press.
Schnietz, Karen E. 2000. "The 1934 Reciprocal Trade Agreements Act: Partisan Institutional Protection of Liberal Trade Policy." Journal of Policy History 12: 417-44.
Douglas A. Irwin is Professor of Economics at Dartmouth College. His book The Genesis of the GATT (coauthored with Petros Mavroidis and Alan Sykes) will be published by Cambridge University Press in 2008.