The stated purpose of the World Trade Organization (WTO), which may come as a surprise, is to raise living standards all around the world. The opening of the Agreement establishing the world trade regime lists the following goals:
raising standards of living, ensuring full employment and a large and steadily growing volume of real income and effective demand, and expanding the production of and trade in goods and services, while allowing for the optimal use of the world’s resources in accordance with the objective of sustainable development, seeking both to protect and preserve the environment and to enhance the means for doing so in a manner consistent with their respective needs and concerns at different levels of economic development.
It is clear that the framers of the WTO were committed to promoting equitable development, but let’s note right away that the means for achieving this aspiration, expanding market access and deepening integration of the global economy, has been confounded with the end of the WTO agenda. In other words, sustainable development is viewed today as synonymous with maximizing trade. This post presents an alternative bent of economic development, following Dani Rodrik’s ‘The Global Governance of Trade as if Development Really Mattered’ in this regard, one which displaces the enshrinement of trade liberalization and emphasizes instead country-specific institutional innovations, based on local knowledge and experimentation.