The World Trade Constitution: Reinforcing Democracy Through Trade

Abstract:     
Many politicians and scholars argue that the recently-established World Trade Organization (WTO) poses a threat to the democratic sovereignty of its member states. This article refutes the conventional wisdom, arguing that, so long as the WTO operates within proper bounds, it can actually reinforce democracy within member states. We contend that the WTO represents a new "world trade constitution" in which domestic majorities have committed to institutions that restrain the ability of interest groups to obtain protectionist legislation at the public expense. We demonstrate that this constitution has the potential both to help majorities work their will and to promote international trade, thereby increasing global economic growth. We address recent proposals to reform the WTO by involving it in setting global standards in such areas as environmental and labor regulation. Far from creating a more democratic process, we show, these proposals would strengthen the influence of interest groups, leading to results that are neither democratic nor efficient. We also consider the most controversial area of the WTO's jurisdiction-its invalidation of safety, health, and environmental measures that discriminate against foreign imports. We urge that the WTO adopt a jurisprudence that reinforces the democratic processes in member states even as it ferrets out such discrimination.

working papers series