Ideas, interests, and institutionalization: “trade in services” and the Uruguay Round

Abstract

After much deliberation, member governments of the General Agreement on Tariffs and Trade (GATT) agreed to pursue a new regime for international trade in services as part of the Uruguay Round negotiations begun in 1986. The talks have produced a draft agreement—the General Agreement on Trade in Services (GATS)—which, if ratified, could have important implications for the world economy. But when the question of trade in services first arose, most governments did not understand the issues or know whether a multilateral agreement would be to their advantage. If anything, their existing national interests and institutions seemed contrary to the goal of liberalizing trade in services. This article argues that an epistemic community of services experts played a crucial role in clarifying and framing the complex issue of trade in services and placing it on the global agenda. Through their analyses of the services issues and their interactions with policymakers, the epistemic community members were able to convince governments that international services transactions had common trade properties and that the liberalization of services through removal of nontariff barriers was potentially advantageous to developing as well as developed countries. In addition to fostering international negotiations within the GATT forum and helping states redefine their interests, the community members were instrumental in specifying a range of policy options to be considered. However, once governments understood their interests and domestic constituencies were mobilized, their policy choices were influenced more by power and bargaining dynamics than by continuing, direct epistemic community influence.