The (Neglected) Employment Dimension of the World Trade Organization

Abstract

A key assumption underlying the World Trade Organization (WTO) is that its program of trade negotiations will strengthen the world economy and lead to more trade, investment, employment and income growth throughout the world. In the author's view, the WTO truly is strengthening the world economy and promoting trade and investment in many parts of the world. Yet the rest of the thesis is debatable. Is it necessarily true that the WTO and the trade negotiations it sponsors are increasing employment and income growth throughout the world? Indeed, even aggregating the world economy into one planetary unit, one wonders whether increased trade (and its ensuing dynamic efficiencies) inevitably increases the quantity of global employment. Even if it does, what is the quality of the jobs created? Does the WTO promote what the International Labour Organization (ILO) calls decent work? Such questions underlie the subject of this article - the neglected employment dimension of the WTO. The author does not propose to answer these questions empirically. Instead, the article endeavors to point out how little the WTO does to monitor these issues or to design trade rules with sensitivity to the objective of employment growth. So far, the WTO has not set any quantitative goals for income or employment growth. The trade ministers have alluded to their desire that the WTO promote the benefit and welfare of their peoples, but the ministers are lackadaisical about keeping WTO negotiations on schedule. In view of the broad nature of international trade law today, the WTO seems to be overlooking many opportunities to promote a positive employment agenda.

Keywords: trade, WTO, employment

JEL Classification: F1, H0, K31, N3, N7