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Whentradeliberalizationturnsintoregulatoryreform:Theimpactonbusiness–governmentrelationsininternationaltradepoliticsCorneliaWollandAlvaroArtigasCentred’E´tudesetdeRecherchesInternationales(CERI)-SciencesPo,Paris,FranceAbstractBusiness–governmentrelationsontradeissuesaregenerallycharacterizedasprotectionistlob-byingor–lessoften–lobbyingfortheliberalizationofmarkets.However,withtheevolutionofthetradingsystem,negotiationstodayconcernnotjustmarketopening,butalsotheregula-toryframeworksthatstructureinternationaltrade.Thistransformationhasimportantconse-quencesforthewaysinwhichprivateinterestscancontributetotradenegotiations.Insteadofsimplytryingtoexertpressure,businessesandotherprivateactorsnowformworkingrelation-shipswithgovernmentsbasedonexpertise,learning,andinformationexchange.Thisarticleillustratesthesenewformsofpublic–privateinteractionswithexamplesfromtheUSA,theEuropeanUnion,andBrazil.Keywords:Brazil,EuropeanUnion,lobbying,trade,UnitedStates.IntroductionInternationaltradenegotiationshavechangedprofoundlyinthelast50years.SincethefirstroundsoftalksundertheGeneralAgreementonTariffsandTrade(GATT),tradenegotiationshavemovedfromthereciprocalreductionoftariffbarrierstoincludeawealthofnon-tariffbarriers,focusingincreasinglyondomesticissueswithanimpactontrade.TheUruguayRoundledtothecreationoftheWorldTradeOrganization(WTO)in1995andexpandedthecoverageofthemultilateraltradingsystemtoservicesandintellectualpropertyrights.Trade-relateddomains,suchasenvironmentorlaborstandards,competition,orinvestmentpoliciesarealsoaffectedbytherulesnegotiatedundertheWTO(seeHoekman&Kostecki2001;Bartonetal.2006).Withtheexpansionoftradeissues,newnon-governmentalgroupshavetriedtotakepartintradenegotia-tionstooffsettheinfluenceofbigbusiness(Bayne&Woolcock2003).Indeed,activistsandtheanti-globalizationmovementshavearguedthattheWTOiscapturedbybigbusiness,whichmaintainsapparentlyprivilegedrelationshipswithtradenegotiators(e.g.Wallach&Sforza1999;Wesselius2002).Correspondence:Dr.CorneliaWoll,CERI-SciencesPo,56rueJacob,75006Paris,France.Email:woll@ceri-sciences-po.orgAcceptedforpublication19February2007.Regulation&Governance(2007)1,121–138doi:10.1111/j.1748-5991.2007.00010.xª2007TheAuthorsJournalcompilationª2007BlackwellPublishingAsiaPtyLtdBusiness–governmentrelationshavebeencentraltoacademicwritingontradepolicyforalongtime.Accordingtotheschoolofeconomicregulation,whichstilldominatestradepolicystudiestoday,tradedecisionsaretheresultofindustrylobbying(Stigler1971;Posner1974;Buchananetal.1980;Krueger1995).Inmosttradepolicyaccounts,businessisassumedtodeterminefirstwhereitsmaterialinterestslie:intheprotectionofhomemarketsorintheaccesstonewmarkets(Frieden&Martin2002,p.126).Itthentriestoinfluencepoliticaldecision-makers,offeringvotesorfinancialincentivesinexchangeforthedesiredoutcome.Withinthisframework,studyingthemakingoftradepolicyrequiresunderstandingwhenfirmswilllobbyforprotectionismandwhenforliberalization,andsophisticatedmodelshavebeendevelopedtopredictingindustrybehavioraccordingtofactordistribution,sectors,orfirmstrategies(Alt&Gilligan1994;Milner1999;Hiscox2002).1Anempiricalstudyofcurrentbusiness–governmentinteractions,however,revealsamorecomplexreality.Firstofall,firmsmaintainagreatvarietyofrelationswithgovernmentsthatgofarbeyondmakinggeneraldemandsforopenorclosedmarkets.Dependingonthesectors,governmentsmaysolicitfirminputandevendelegatetaskstobusinessactors(Cutleretal.1999).Second,business–governmentrelationsoftentaketheformofcloseworkingrelationships,characterizedbythemutuallybeneficialexchangeofinformationandreciprocallearning(Shaffer2003;Woll2005).Althoughfirmssometimesknowexactlywhattheywantandthenpressuretheirgovernmentstocomplywiththeseinterests,business–governmentrelationsgofurtherbeyondsimplepressurelobbyingthanpreviouslyassumedintheinternationalpoliticaleconomyliter-atureontrade.Thecentralargumentofthispaperisthattraditionalbusiness–governmentmodelsfailtocaptureanincreasinglycomplexempiricalreality,becausetheyarebasedonanoutdatedandsometimesinaccurateconceptionthenatureoftradenegotiations.Pressurelobbyingforprotectionismorliberalization,asappropriateasitmaybefortariffnego-tiations(e.g.Kingstone2000),doesnotaccountforstrategiesrelatedtothenewdynam-icsandcomplexissuesnegotiatedundertheWTO.Theliberalizationoftradeinproductshasmovedthetargetofbusinesslobbyistsfromtariffstoprocessandproductionmeth-ods–andthereforetoenvironmentandlaborstandards–althoughsubsidies,andlatelysafeguards,remainanimportantissue(Hoekman&Kostecki2001,p.453;Read2005).2Recenttradingissuesincreasinglyimplytheconstructionorharmonizationofspecificregulatoryregimes,especiallyinnewareassuchasintellectualpropertyorservicetrade(Sauve´&Stern2000;Mattoo&Sauve´2003).Thisnotonlyappliestomultilateralagree-ments,suchastheWTO’sSanitaryandPhytosanitaryMeasuresAgreement,theTech-nicalBarrierstoTradeAgreement,orelementsoftheGeneralAgreementonTradeinServices,ithasalsobeenparticularlytrueinthecaseofbilateralagreementssincetheearly2000s.3Inthiscontext,business–governmentrelationsresembletheintera
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