Title : What strategies are viable for developing countries today? The World Trade Organization and the shrinking of 'development space'
Working Paper No : 31 (series 1)
Author(s) : Robert Hunter Wade
Date : June 2003
[PDF]
Abstract : The world is
experiencing a surge of international regulations aimed at
limiting the development policy options of developing country
governments. Of the three big agreements coming out of the
Uruguay Round ? on investment measures (TRIMS), trade in
services (GATS), and intellectual property rights (TRIPS) ? the
first two limit the authority of developing country governments
to constrain the choices of companies operating or hoping to
operate in their territory, while the third requires the
governments to enforce rigorous property rights of foreign
(generally Western) firms in the face of ?theft? by domestic
firms. Together the agreements make comprehensively illegal many
of the industrial policy instruments used in the successful East
Asian developers to nurture their own firms, industries and
technological capacities. They are likely to lock in the
position of Western countries at the top of the world hierarchy
of wealth.
The paper describes how the three agreements, in the name of
motherhood principles like ?reciprocity? and ?no distortions?,
constitute a modern version of Friedrich List?s ?kicking away
the ladder?. It then outlines some needed changes in the way we
think about development and in the role of multilateral
organizations. It concludes that the practical prospects for
change along these lines are slender, but not negligible.