Trading Away Tariffs: The Operations of the GATT System

Abstract

Abstract Since its formation, the GATT/WTO system has facilitated a worldwide reduction of trade barriers. We return to a founding moment of the regime, the GATT 1947 (GATT47), and look closely at the liberalization process, analyzing exactly what concessions were granted to whom and in return for what. With these data, we evaluate three prominent explanations for the operation of the early GATT. First, we ask whether or not US negotiators granted asymmetric access to the US market to spur post-war recovery. Second, we look at how the rules adopted in GATT47 balanced the interests of import sensitive producers with those of the more nascent exporter interests. Third, we examine specific US concessions and ask whether or not the US used the domestic market to either increase the productive capacity of nations damaged during the war and/or to bolster unstable regimes. Our most general finding is that the US, at least in this first Round of the trade regime, was less a liberal warrior and more a seeker of stability, and that tariff setting was significantly constrained by the institutions governing global tariff negotiations.