The New Protectionism in Industrial Countries: Beyond the Uruguay Round
IMF Policy Discussion Papers, February 1, 1994
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Bibliographic details
- Authors: Douglas A. Irwin
- Published: February 1, 1994
- Series: IMF Policy Discussion Papers
- DOI: https://doi.org/10.5089/9781451972405.003
Overview and central thesis
- Author: Douglas A. Irwin
- Date of issuance: February 1, 1994
- Central thesis: Trade protection in industrial countries has shifted from protecting agriculture and basic manufacturing (dominant in the 1970s and 1980s) toward protecting and promoting high-technology sectors in recent years; new forms of protection—particularly subsidies and antidumping rules—have not necessarily contravened GATT rules, and the Uruguay Round fell short of reigning in such interventions.
- Policy implication highlighted: The next challenge for world trade negotiators is to contain the pressures for intervention in high-technology and similar areas.
Key findings and analysis
- Historical shift in emphasis:
- 1970s and 1980s: Protection focused on agriculture and basic manufacturing, where many industrial countries had lost (or never had) comparative advantage.
- Recent years (relative to paper): Emphasis has moved toward protection and promotion of high-technology sectors.
- New forms of protection:
- Primary instruments identified: subsidies and antidumping rules.
- Legal context: These measures have not necessarily contravened GATT rules.
- Assessment of the Uruguay Round:
- Conclusion: The Uruguay Round fell short of reigning in interventions using subsidies and antidumping rules.
- Economic appraisal:
- Theoretical, empirical, and practical considerations call for great skepticism about the desirability and efficacy of recent trade interventions, even if theoretical justifications exist under certain conditions.
- Policy challenge:
- World trade negotiators face the task of containing pressures for intervention in high-technology and related areas.
Policy recommendations and implied actions
- Contain pressures for intervention in high-technology sectors and analogous policy domains.
- Exercise skepticism toward interventionist trade policies (subsidies, antidumping) given doubts about their efficacy and desirability from theoretical, empirical, and practical perspectives.
- Strengthen multilateral discipline beyond the Uruguay Round to address newer forms of protection that fit within existing GATT rules but undermine liberalization objectives.