Beyond Trade

Abstract

Increased complexity and density of transnational problems create unprecedented challenges and opportunities for contemporary international governance. “Issue linkage” is one institutional arrangement through which states address these changing circumstances. In this article, we examine the widening scope of the nontrade agenda in preferential trade agreements (PTAs). Nontrade issues (NTIs) such as human rights, democracy, environment, corruption, and labor standards are increasingly linked to PTAs. This issue linkage has important implications for understanding changing patterns of international trade, including the shift to PTAs and the rise of NTIs. We show that (1) states’ choices to commit to bilateral or plurilateral versions of traditional PTAs and to PTAs with NTIs are highly interdependent, (2) states increasingly incorporate NTIs into PTAs, as the associated costs of policy change are lowered through earlier agreements, and (3) network pressures favor the increasing adoption of bilateral and especially plurilateral NTIs over time. Using an original data set on NTIs covering 522 PTAs and spanning the period 1951 to 2009, we evaluate states’ motives behind the widening nontrade agenda of trade agreements using longitudinal network modeling. We employ multiplex coevolution stochastic actor-oriented network models in a novel design to account for interdependencies within and across states’ decisions. Following a descriptive mapping of major NTIs, we evaluate our theoretical arguments. Testing against the alternative explanations of power and commitment, we find that endogenous cost considerations are the most significant factor explaining the inclusion of NTIs into PTAs.