Economists Steve DeLoach and Tina Das recently had a paper accepted for publication. The paper, “Power Politics and International Labor Standards,” will appear in International Advances in Economic Research, Volume 12, No. 1, February 2006.
The paper was co-authored with Lindsey Conley ’04. The project began when Das, DeLoach and Conley received a Summer Undergraduate Research Experience (SURE) grant in the summer of 2003.
The paper analyzes the ongoing debate over the economic rationale and fairness of proposals to make international trade conditional on the harmonization of labor standards. Recent bilateral agreements between the United States and countries like Jordan and Cambodia are often cited as models for how linking labor standards to trade can improve working conditions and increase exports in less-developed countries.
With this in mind, DeLoach, Das, and Conley investigated factors that affect countries’ enforcement of standards relating to “freedom of association and collective bargaining.” Based on their empirical analysis, they found wealthier countries and those that spend more on education are more likely to enforce higher levels of labor standards. Most interestingly, however, relatively powerful countries are less likely to enforce labor standards.
As they argue, the idea that relatively powerful countries are able to shirk the enforcement of labor standards without incurring potentially costly trade sanctions is deeply troubling. The data suggest that relatively powerful countries are in a position to use the adherence to international labor standards as a tool of strategic trade policy. By forcing less powerful countries to adhere to strict labor standards that more powerful countries can shirk, powerful countries are able to extract a greater share of the gains from trade. This raises significant questions about the fairness and logic of all such linked trade agreements.
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