US interests, institutions, and negotiation strategies for agricultural trade

This paper provides an empirical test of how U.S. interests and the GATT regime affect the likelihood of cooperation. Specifically, I examine cooperation on the issue of agriculture trade policy liberalization. By disaggregating different features of negotiations, I demonstrate which institutional features are most important and how they change the political balance in countries that favor agricultural protection. The findings confirm that some but not all features of the GATT institution facilitate liberalization outcomes while controlling for other likely explanations for policy change. Through linking industry issues together in a negotiation with agricultural issues and providing credibility for the linkage, a package negotiation structure can increase the likelihood of liberalization. Comparison of negotiations between the US, Japan and Europe, reveals intriguing differences in how GATT influences policy. Cross-sector linkage between industry and agriculture promotes liberalization in both Japan and the EU, but formal GATT mediation and normative pressure from legal rulings change behavior in Japan and not in Europe. Top candidates for alternative theories point to budget pressures and economic conditions, or the coercive power of threats. While these factors cannot be dismissed, my point is to illustrate that they play a secondary role to features related to the institutions of the trade system. Threats are also more influential against Japan than Europe,while both tend to liberalize agriculture more when there is lower growth in government budget spending. Agriculture policies stand out as one of the most difficult areas for countries to reform protection policies given the entrenched programs and continuing political power supporting the status quo. The fact that agricultural programs resisted reform for decades and protection levels rose despite GATT rules against those policies makes this a ”least likely” case for GATT mediation to promote trade liberalization. If I can show that the GATT institution has any effect in the area of agriculture trade, this is strong evidence supporting theories about the importance of institutions in international relations. Such a hard test is necessary in order to respond to the critiques of realist theories of international relations that contend institutions have little independent impact on international relations and can only facilitate cooperation in the easy cases where differences between parties are small (Mearsheimer 9945). There are two tasks for this study of negotiation context and policy liberalization. First I will briefly address the pre-negotiation stage in which the negotiation context is chosen. Here I focus on US interests as the demanding country along with its anticipation of the reaction in the targeted country. This analysis addresses the potential for a selection effect for which cases go to the GATT institution for mediation. The literature on international