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Why Do Countries Adopt Free Trade?
Democracy- Versus Elite-Based Explanations
Malcolm Fairbrother
School of Geographical Sciences
University of Bristol
University Road
Bristol BS8 1SS
United Kingdom
[email protected]
Tel: +44 117 9288303
July 2013
Abstract
Since the 1990s, why have so many countries made policy changes liberalizing international
trade and direct investment? A number of studies have found a statistical association between
economic openness and political democracy, and present free trade as a consequence of states’
increasing accountability to majority interests and preferences. Other research challenges this
view, however, emphasizing instead the preferences and power of elites. This article evaluates
these two perspectives against each other by assessing evidence for their presumed causal
mechanisms. The weight of the evidence, from the secondary literature and case studies of
Mexico and Canada, supports the elite-centered perspective more than the alternative, calling
into question the theory that democracy fosters free trade.
Keywords: free trade; democracy; elites; foreign direct investment; NAFTA
2 Introduction
Policy changes have been the source of three-quarters of post-World War II growth in
world trade as a share of GDP—much more than technological innovation and diffusion (Baier
and Bergstrand 2001). Such policy changes have often taken the form of international “free
trade” agreements liberalizing foreign direct investment as much as trade, and substantially
expanding cross-border flows of goods, services, and capital (Baier and Bergstrand 2007; Büthe
and Milner 2008; Goldstein, Rivers, and Tomz 2007).
This article addresses the question of why so many countries have adopted free trade—
liberalized trade and direct investment—since the 1980s.1 The literature on this question is
sharply divided between explanations pointing to the rise and impact of political democracy and
others based on the actions of economic, political, and/or technical elites. To their mutual
detriment, neither approach gives serious consideration to the other; if anything, they each give
the impression that the other does not exist. This article seeks to overcome this balkanization.
The major evidence for the democracy-centered explanation of free trade is statistical:
cross-sectional and longitudinal associations between democracy and economic openness. The
theoretical rationale for this perspective is that under democracy the interests and preferences of
the majority rule, and liberal trade and investment policies are in the interest of the majority. In
authoritarian polities, by contrast, states are often tied to local businesspeople who, this view
holds, stand to lose out from free trade and so demand autarky instead.
The alternative to this approach is one emphasizing elites as the key supporters of free
trade, where elites are people in possession of relatively large amounts of some valued resource,
such as money, legal authority over public policy, or recognized expertise. Studies emphasizing
3 the roles of economic, political, and/or technical elites suggest a more antithetical relationship
between free trade and democracy, wherein majority interests and/or preferences are not
overpowering, but irrelevant or even overridden. While sharing a common emphasis on the
preferences and behaviors of elites, studies comprising this second literature nonetheless diverge,
in that they concentrate on four different kinds of elites with diverse relationships to the
policymaking process: businesspeople, state technocrats, international financial institutions, and
economists. Implicitly, the literature suggests that these actors work together in two specific
combinations, depending on countries’ levels of development. In developed countries, business
mobilization has been central to the liberalization of trade and direct investment; in developing
countries, on the other hand, states have pursued such policy changes more independently of
domestic business. In the latter context, free trade has been a project of state technocrats both
empowered and constrained by international financial institutions and markets. The elite-focused
literature thus explains free trade as the product of two distinct political economic pathways.
This article tests both the democracy- and the elite-based explanations of free trade. To
do so, I first compare their presumed causal mechanisms with relevant results from other existing
studies, particularly research on public opinion. Second, the article employs Lieberman’s (2005)
mixed-method strategy for comparative research, which combines cross-national statistical
modeling with studies of specific country cases conforming to fitted statistical models. A valid
theory should be capable of predictions consistent both with regressions across countries, and
causal processes within them. This paper treats the cross-national regressions presented in other
published studies as the first stage of a nested analysis, and both generic and case-based evidence
as the second. This article therefore responds to recent reviews of the democracy-centered
literature, which note that the mechanisms linking presumed cause and effect remain uncertain,
4 and that there is a need for more work on precisely how democracy, arguably, may foster
liberalization (Milner and Mukherjee 2009: 178; also Guisinger 2009: 554). In a literature reliant
on observational rather than experimental data, solid evidence for causal mechanisms would
seem important if not essential for demonstrating a causal relationship.
The two country cases considered here are those of Mexico and Canada. These two
countries followed independent but parallel tracks to economic opening from the early 1980s to
the mid-1990s, culminating in their common enactment of the North American Free Trade
Agreement (NAFTA) in 1994. They both previously restrained their integration with the
neighboring, much larger United States economy; they both passed nationalist and restrictive
foreign investment laws in 1973; and in 1980 they jointly rejected U.S.-based proposals for
continental economic integration (Senate Standing Committee on Foreign Affairs 1980). In
1988, both countries held elections that narrowly returned governments who subsequently
dismantled their countries’ long traditions of restraining rather than embracing continental
economic integration. Considering their trajectories from the early 1980s to the mid-1990s thus
makes each country both a negative and a positive case (Haydu 1998), and allows for an
assessment of cases following both pathways implied by the elite-based literature.
To preview the paper’s main arguments, both generic and case-specific causal process
observations belie key implications of the theory that democracy fosters free trade. In most
countries, survey research finds that public support for trade and investment liberalization is
lukewarm at best, and not strong enough to have much impact on policymakers. In the specific
cases of Mexico and Canada, public opinion was largely irrelevant; free trade derived instead
from the changing preferences of political and economic elites, respectively. While this
conclusion will be unsurprising to some, for scholars explaining liberalization by reference to
5 democracy and majority interests, the results of the case studies should represent an important
challenge. Given the lack of support for the theory’s posited mechanisms, the case for a causal
relationship between democracy and free trade is not yet convincing; the relationship may be
spurious. The article concludes with suggestions for future research, particularly on the statistical
association between democracy and free trade.
Free Trade and its Drivers
Given the prevalence of liberal trade and investment policies today, it is easy to overlook
how different the world was prior to the policy shifts of the 1980s and 90s. According to one
influential dataset, which codes countries’ trade regimes as either “open” or “closed” every year
since 1950, only 37 out of 140 were open in 1980, and of these only 15 were developing
countries.2 Ten years later, 61 countries were open, and then 103 by 2000.3 With respect to direct
investment and the multinationalization of production, the stock of worldwide FDI as a share of
GDP increased from 5.92 per cent in 1980 to 31.57 per cent in 2010.4
Until the 1990s, the United States and Western European nations had generally open
economies, especially the smaller European nations (Katzenstein 1985). The other western
offshoots (Australia, Canada, and New Zealand), and Japan, were a little less liberal though still
broadly open to the world economy. In the rest of the world, barring a few outliers like the East
Asian Tigers, only starting in the 1990s did trade and direct investment begin to grow steadily.
Many developing countries, including large ones like Argentina or Brazil, worked to delink their
economies from international markets for substantial periods of time. As late as 1985, one
influential scholar, in a book subtitled The Third World Against Global Liberalism, named India
and China as “developing countries that are substantially disengaged from the world economy,
6 and are likely to remain so” (Krasner 1985: 296). In the 1970s, there were international conflicts
about international economic integration, and heated debates about whether poorer countries
stood to gain much from it (Frieden 2006). From World War II until the 1980s, free trade was
thus limited to only a minority of (mostly wealthy) countries, while the speed of change since the
1980s has been dramatic.
Explanation I: Democracy and Factors of Production5
Coincident with the rise of economic liberalism in the late twentieth century, many
countries also transitioned to more politically liberal regimes in the 1980s and 1990s (see e.g.,
Schwartzman 1998; Wejnert 2005). And statistical analyses have found strong evidence that
democracy is positively associated with international economic liberalism.6 Democratization
tends to be followed by increases in trade flows, tariff reductions, and the liberalization of nontariff barriers to trade (Dutt and Mitra 2002; Eichengreen and Leblang 2008; Mansfield, Milner,
and Rosendorff 2002; see Milner and Mukherjee 2009 for a review). Similar results hold for
direct investment (Pandya forthcoming). If democracy is taken somewhat more abstractly to be
relative equality of political power in society, there is other evidence for the proposition that
democracy and economic openness are associated. For example, post-Communist countries with
more fragmented state power have tended to liberalize trade more than similar states where
power has been more centralized—and this holds even for non-democratic countries (Frye and
Mansfield 2003). In short, the statistical evidence for an association appears strong, though
questions remain about its robustness to alternative measures of openness (Kono 2006) and the
possibility that democracy is partly a consequence, not just a cause, of free trade (Rudra 2005b).
7 Why might political democracy cause trade and investment liberalization? Advocates of
interpreting the association as causal argue both that democratization grants political power to a
wider share of the population—making their policy preferences more influential—and that most
people will have favorable views of freer trade and other kinds of economic liberalism because
liberalism produces economic benefits for the majority (Milner and Kubota 2005). This view of
trade rests on neoclassical economic theory, which holds that countries can reap the gains of
specialization and comparative advantage irrespective of the types of goods and services they
produce (e.g., Krugman 1993). The end results should be greater efficiency and the consumption
of more and/or higher quality goods and services; as Destler (1995: 283) explains, “the whole
purpose of trade is … to buy from abroad what is less expensive there.”
The theoretical rationale for linking free trade to democracy derives largely from the
expected benefits of openness versus autarky for different constituencies in a country. The
neoclassical Heckscher-Ohlin-Samuelson model of trade (referred to hereafter as “HOS”)
predicts that a country’s relatively abundant factors of production stand to gain from
international economic integration, and scarce factors do not (see e.g., Goldberg and Pavcnik
2007).7 A scarce factor, by virtue of its being scarce, commands a high price in the status quo
situation of economic closure, whereas international integration makes it less scarce and thus
undermines its power in the marketplace. In developing countries contemplating integration with
wealthier ones, low-skilled labor is the relatively abundant factor, whereas in wealthier nations
capital and highly skilled labor are the abundant factors. Given this view of different people’s
interests, and the rational choice assumption that interests drive preferences, HOS predicts that
capital owners and high-skill workers in poorer countries will prefer economic closure, while
lower-skilled workers will support it. There is therefore theoretical reason to expect more
8 liberalism in developing countries where public policies are more accountable to majority
opinion; autarky is likelier under conditions of non-democracy, where political rulers cater to the
domestic elite of capital owners and highly skilled professionals (Milner and Mukherjee 2009).
Governments’ responsiveness to the will of the median voter, and the threat of electoral
punishment, therefore drives the liberalization of trade and direct investment; democracy fosters
free trade by allowing the preferences of the majority to rule (Busch and Mansfield 2010; Milner
and Kubota 2005; Pandya forthcoming). Kono (2008) thus finds that democracy, in interaction
with public support, is associated with freer trade—though he also finds that democracy by itself
is not, where public support is absent.
The democracy-centered literature tends to focus on developing countries, because of the
opportunities to exploit change over time in the level of a given country’s democracy; few
wealthy countries have recently transitioned to democracy. But the argument does have
implications for wealthier (and thus more capital-abundant and labor-scarce) nations. In such
contexts, HOS predicts the benefits of opening to flow more to capital owners than to workers
(Watson 1993). Yet because the median voter remains a worker, public opinion on trade should
be mixed, at best (a prediction which survey data support, as discussed below). If democracy
makes policymakers accountable to the preferences of the majority, and the majority of voters in
richer countries have ambiguous interests with respect to trade, then there is little reason to
expect liberalization in such nations to derive from the democratic accountability of politicians to
the electorate. Consistent with this implication, one recent study finds that while democracies
and wealthier countries tend to be more open than non-democracies and poorer countries, the
interaction between these conditions is associated with greater trade barriers (Tavares 2008).
9 Explanation II: Elites and their Power
In contrast to studies focused on democracy and the preferences of the majority, other
research emphasizes the agendas and actions of elites. The emphasis on the behaviors and/or
interests of the few, rather than the preferences and interests of the many, sets this second
literature at odds with the first; the implication is that, if anything, political democracy is
antithetical to free trade. The two literatures also differ in that the first expects business to favor
autarky (at least in developing countries), whereas the second—depending on the specific
variant—views business as a key advocate of free trade.
The elite-centered arguments emphasize at least four distinct categories of actors who
they claim perform key roles in fostering free trade: international creditors, domestic business,
economists, and technocrats. These arguments all suggest that free trade follows from some
category of elites favoring international economic opening, acting in pursuit of that policy goal,
and possessing sufficient power such that they can instigate a significant shift in public policy,
perhaps even in the face of opposition. This section discusses each category of elites in turn.
First, one major strand of the political economy literature stresses the power of wellresourced international financial institutions and private creditors, and emphasizes their
preference for market-conforming policies (McMichael 2005; Park, Jang, and Lee 2007; Woods
2006). When a state becomes dependent on the IFIs (the World Bank and International Monetary
Fund), this dependence allows the latter to dictate policies to the former—such policies typically
being liberal and conducive to economic opening and integration. Dependence arises from debt
or balance of payments crises, where a state cannot repay its foreign creditors, and so desperately
requires short-term financial assistance. In another, somewhat softer variant of this argument,
10 dependence on the IFIs shifts the balance of power in domestic politics, and gives an advantage
to actors sympathetic to the same policies as the staff of the IFIs (e.g., Schneider 1998; Teichman
2004). Political actors with the training and connections that allow them to negotiate with a
state’s foreign creditors gain an advantage in competing for policymaking control, and are thus
eventually empowered to implement market-oriented policy revolutions as an “inside job” (Babb
2001). A final variant suggests that the influence of the IFIs can be intellectual: financial
dependence makes it harder for states to ignore the abundance of IFI-generated reports and
studies advocating economic liberalism (Broad 2006; Edwards 1997).
A second category of explanations looks not to external constituencies, but to a key
domestic one: the private sector. Many studies present neoliberal policy changes as the product
of proactive lobbying and campaigning by business, especially big business and/or multinational
firms specifically (Carroll 2004; Robinson 2004; Rupert 2000; Sklair 2002; Van Apeldoorn
2002). This perspective holds that business wins from freer markets, often at the expense of other
interest groups, and presumes that business unity in support of liberal trade and investment
policies is high (Harvey 2005).8 Work in this vein often adopts a very class-oriented view of
policymaking generally, contrary to work rejecting that business is a unified collective actor
(e.g., Hart 2004). Neoliberal agreements and policies benefit business by helping to suppress
wage and benefit demands by labor, and/or by entrenching pro-business governance measures in
areas like investor and/or intellectual property rights (Gill 1995). Some statistical research has
also emphasized business collective action, showing for instance that in the U.S. congressional
votes on NAFTA (in 1993) and the GATT (1994) capital and labor groups were bitterly opposed,
with business in favor (Beaulieu and Magee 2004).
11 The third approach shifts to another domestic but extra-state constituency: economists.
Some literature suggests that recognized technical authorities in relevant policy areas can use the
force of their expertise to convince political elites and/or the general public to become favorable
to neoliberal policies (Rupert 2000; Sheppard 2005). Economists in universities and think tanks
may have no formal policymaking authority, nor exceptional financial resources at their disposal,
but they have intellectual authority with respect to economic policymaking, and thus arguably
substantial influence over it (Bockman and Eyal 2002; Montecinos and Markoff 2001). This
authority increases the impact of their written reports, oral testimony, and statements in the
media, and gives them some influence over the views of non-economists in policy-relevant
roles—business, law, public administration, and the like. Survey-based research into economists’
policy preferences confirms that they are strongly unified in support of liberal trade policies
(Blendon et al. 1997; Frey et al. 1984). The neoclassical framework has long subscribed to the
idea of comparative advantage, and rejected mercantilism as internally contradictory (Krugman
1993). Among industrial democracies since the Great Depression, the strength of economists’
support for free trade has been consistently strong, though support among developing country
economists has been much more variable, as the discipline of economics has changed
substantially over the course of several decades in many developing countries (Coats 1997; Babb
2001; Montecinos and Markoff 2001). As developing country economists have become more
similar to their developed country counterparts (i.e., more neoclassical), their policy preferences
have converged. One recent study, albeit of another policy domain, therefore finds that the
higher the number of American-trained economists in a country, the higher the likelihood of
privatization, consistent with the thesis that the preferences of economists carry substantial
weight (Kogut and Macpherson 2008).
12 The fourth and final body of literature looks again at economists, but this time within
rather than outside the state. “Technocrats” are the final group of actors sometimes said to be key
agents of neoliberalism (for discussions see Centeno 1993; Domínguez 1997; Markoff and
Montecinos 1993). Technocrats are state actors with formal authority over policymaking, which
allows their preferences to exercise significant direct influence over key outcomes. What
distinguishes technocrats from other politicians is their prior academic training and possession of
recognized credentials in economics. Such training makes them intellectually committed to
liberal trade an investment policies, to a much greater degree than other politicians would be,
given specified levels of support versus opposition by the general public and relevant interest
groups. Non-technocratic politicians may therefore bend with the political winds on trade, with
interest group pressures exogenously determining their policy priorities. In contrast, like
economists outside the state, technocrats’ own biographies condition their policy preferences.
Unlike economists in universities and think tanks, however, technocrats have direct, formal
authority over policy. As evidence for the influence of technocrats, Chwieroth (2007) finds that
having economists in top government posts increases the probability of a country liberalizing its
capital account.
Among these various elite-focused arguments, few if any have confronted the reverse
thesis that free trade is a consequence of democratization. This paper is the first to use case
studies of specific countries to assess both explanations simultaneously. Doing so, however,
requires recognizing how the various elite-centered arguments reviewed above do not apply to
all countries. Rather, existing studies strongly suggest that in developed countries, states have
liberalized trade and investment pursuant to private sector mobilization (e.g., Blyth 2002; Harvey
2005; Levitt 2006; McBride 2001; Rupert 2000; Saad-Filho and Johnston 2005; Sklair 1995,
13 2001). In developing countries, by contrast, states have acted more autonomously from domestic
business; they have tended to open their economies under greater influence from abroad, and
under the guidance of technocrats whose policy preferences largely dovetail with those foreign
influences (Babb 2001; Geddes 1995; Haggard and Kaufman 1992). The lower enthusiasm of
business in developing countries is understandable in light of the Heckscher-Ohlin-Samuelson
model, discussed earlier, which implies that developing country capitalists are likely to suffer
more from international competition. It also follows from the fact that, until the 1980s, many
developing states used import-substitution industrialization strategies specifically to foster
industries not otherwise viable without state assistance and protection. Evans (1979: 273) and
Behrman (1974: 3) therefore argue that prior to the dramatic rise of FDI in recent decades,
businesspeople in developing countries often sought state protection in their home markets from
foreign-based multinational enterprises.
Causal Process Evidence
This section assesses the democracy- and elite-centered theories, by examining the
evidence for the observable implications of their implied causal mechanisms. Process-tracing, or
narrative appraisal, can contribute to theory testing by checking for a previously unspecified
chain of events and/or conditions plausibly linking an independent variable or antecedent
condition to a dependent variable or outcome of interest (George and Bennett 2005; Mahoney
1999). The absence of such a chain suggests that a statistical association between two variables
may well be spurious.
14 The section begins by presenting broad-based evidence about causal processes in many
countries, drawing in particular on results from recent survey data analyses, and then proceeds to
discuss the details of causal processes of specific cases.
First, the democracy-based explanation of free trade posits that public opinion supports
free trade in most countries. Is this view justified? The third wave of the World Values Survey
(conducted in the mid-1990s) asked nationally representative samples of respondents in a crosssection of 52 countries: “Do you think it is better if: (A) goods made in other countries can be
imported and sold here if people want to buy them, or (B) there should be stricter limits on
selling foreign goods here, to protect the jobs of people in this country?” In only eight countries
did more respondents answer A than B. Economists might point out that this is a misleading
question to ask, insofar as trade actually has little impact on employment (Krugman 1993). That,
however, is beside the point under consideration here: if people believe that trade depresses
employment, and they support trade restrictions more than trade opening as a consequence, the
fact remains that free trade is not a policy rooted in the preferences of the majority.
Other survey research finds substantially more support for trade and investment
liberalization. Surveys in many countries over multiple waves in the 2000s by the Pew Global
Attitudes Project (2009), for example, have found that majorities everywhere think “growing
trade and business ties” with other countries are a good or very good thing for their countries.
The seemingly contradictory results of these surveys are reconcilable in light of the major effects
of question wording. Using survey experiments with samples of American and Argentineans, for
example, Hiscox (2006) and Ardanaz, Murillo, and Pinto (2013) respectively find very different
responses depending on whether a question about trade includes a preamble about possible
effects on jobs.9 While calling into question claims of widespread public opposition to free trade,
15 these results also suggest more importantly that most people hold only weak opinions about
international economic policy. Recent work shows that trade as an issue has very low salience
for the public, such that voters are scarcely aware of how their elected representatives voted on
recent trade legislation, and do not use the ballot box to hold politicians accountable for those
votes (Guisinger 2009; Medrano and Braun 2012).
Second, arguments about the consequences of political democracy for policy outcomes
rest heavily on the HOS trade model, described above. The theory predicts that elites in poorer
countries will favor autarky, while the majority will be more pro-trade, while this cleavage
should be reversed in richer countries. But do the available survey data actually support these
predicted preferences? In the case of the capital-abundant United States, there is indeed a strong
positive correlation between various measures of skill (or human capital) and support for free
trade, as HOS would predict (Hainmueller and Hiscox 2006; Scheve and Slaughter 2001). And
cross-nationally, the more capital-abundant the country, the greater the impact of a worker’s skill
on his/her support for free trade, another finding consistent with HOS (Mayda and Rodrik 2005).
There is not, however, the expected negative correlation between skill and pro-trade sentiment in
poorer countries: skill correlates with support for freer trade even in countries where HOS
predicts it should not (Margalit 2012; Medrano and Braun 2012). And analyses of individuallevel survey data belie a Heckscher-Ohlin-Samuelson-based model of people’s policy
preferences in other ways too. Some studies find that, contrary to HOS, policy preferences and
political cleavages follow the logic of a sectoral model known as Ricardo-Viner, wherein capital
and labor are allied within industries and divided across them (Hiscox 2001). Cross-sectionally,
preferences are tied to consumption, not just positions in the labor market (Baker 2005).10
16 In sum, there is little evidence that people’s policy preferences are clear and strong, that
they reflect the trade model underlying the arguments about the influence on democracy, or that
voters take trade and investment policy into account when voting.
Case-Specific Evidence about Causal Processes
I now turn to causal process observations specific to particular cases of economic closure
and opening. In order to select appropriate cases, I follow the recommendations of Lieberman’s
(2005) nested analysis approach. According to that approach, in instances where the results of an
initial large-N analysis appear broadly satisfactory, cases selected for subsequent qualitative
investigation should fall “on the [regression] line.” The rationale is that such cases should
possess causal processes that are more representative than exceptional. I chose the case studies
that follow because they conform to the key pattern in the large-N democracy-centered literature
and in the small-N elite-based literature.
I consider the experiences of Mexico and Canada, a developing country that transitioned
to democracy at the end of the twentieth century, and a stably wealthy democracy. Each country
can be treated as at least two cases—one before and one after a significant episode of economic
opening—allowing for contrasts between positive and negative cases of free trade, and avoiding
problems of selection bias.11 Developing country cases that fall “on the line” for the democracybased literature are those where democratization preceded the liberalization of trade and
investment policies. The experiences of wealthier, more developed countries such as Canada are
not typically the focus of the democracy-based literature, much of which considers only
developing countries. But the theory that democracy fosters economic openness has implications
17 for wealthy democracies: their openness should be due, in substantial part, to their politicians’
accountability to publics that support free trade. In contrast, the elite-centered view charges that
the durability, if not expansion, of economic openness in any country is due to advocacy or
pressure from the powerful few, not the majority.
According to the elite-based argument reviewed above about the power of international
financial institutions and markets, free trade is partly due to external influences. Other studies go
further, and suggest that, at least in some instances, free trade is a direct imposition of states
and/or private elites in dominant nations—in recent times, the United States above all.
Explanations of the rise of the post-World War II multilateral trading system point to the
willingness and ability of the U.S. to “both twist arms and offer system-sustaining concessions”
(Krugman 1991: 28; Mastanduno 2009). Some nationalist accounts view the willingness of
Mexico and Canada to negotiate North American free trade as the continuation or intensification
of longstanding U.S. domination (e.g., Calderón and Arroyo 1993; Barlow and Campbell 1993;
Hellman 1983; Levitt 1970). As discussed below, the U.S. expressed its interest in an expansive
regional economic integration agreement decades before Mexico or Canada. Perhaps American
pressure overwhelmed domestic politics? If indeed North American free trade was a U.S.
imposition, however, then free trade in Mexico and Canada cannot have been due to either
democracy or to the actions of domestic elites; such arguments thus challenge both general
approaches. Methodologically, moreover, the cases could not be considered independent.
The accounts that follow, however, belie suggestions that North American free trade was
a simple imposition of either the American state or American economic elites. Politicians in both
Mexico and Canada came to believe in free trade for reasons discussed below, and both countries
held out successfully on many contentious issues in the negotiations (e.g., energy, agriculture,
18 cultural industries—see e.g., Cameron and Tomlin 2000). They also made the U.S. wait many
years before agreeing to negotiate in the first place. In the Mexican case, the state sought
assistance from U.S.-dominated international institutions in the 1980s (most notably the IMF),
which gave the U.S. leverage over Mexican policymaking for a time. But there is otherwise no
evidence of direct imposition of free trade on either Mexico or Canada; indeed, short of massive
bribery or the threat of war, it is not clear precisely what form “imposition” could take. American
businesspeople contributed to North American free trade by lobbying for specific content in the
agreements and in promoting NAFTA to the American public, not by pressuring counterparts or
politicians abroad.
These accounts describe complex historical processes in only summary form. They do
not provide comprehensive histories, but employ existing historical materials in ways that allow
for assessments of, and thus an adjudication between, the democracy- and elite-based
explanations of free trade. They aim to capture each case’s key characteristics, and aside from
existing historical accounts they rest on much original data collected by the author in the course
of a broader project on North American free trade generally. This entailed 114 interviews with
informants in Mexico, Canada, and the U.S. (mostly negotiators, other public officials,
politicians, political staff, and private sector representatives); analyses of a wide range of
archival evidence (governmental and private sector publications, transcripts of legislative
debates, news coverage, and public opinion polls); and a synthesis of many previous academic
studies and journalistic accounts of North American free trade. Interviewees agreed to speak on
condition that they not be quoted by name, but identified solely by their posts at the time.
19 Mexico
From the mid-twentieth century through the early 1980s, Mexico employed a strongly
nationalist-statist though still broadly market-based development model, and economic openness
was low. Mexico declined to join the multilateral trading system (the GATT), and relied on a
complex system of tariffs, quotas, regulations, and import licenses, to restrain its international
economic integration via trade and investment (Lustig 1998). In contrast, starting in the later
1980s and through the 1990s and 2000s, Mexico firmly embraced international trade and
investment, and saw dramatic increases in its international economic integration. In 1986 it
joined the GATT and in 1987 the state unilaterally accelerated its international economic policy
liberalization program, in an effort to deal with a surge of inflation. According to the Wacziarg
and Welch dataset, Mexico was open starting in 1987. But Mexico’s most important
international economic policy shift of the late twentieth century was yet to come: the initiation of
talks with the U.S. in 1990 about a free trade agreement (FTA). On January 1st, 1994, as the
culmination of trilateral negotiations among Mexico, the U.S., and Canada, the North American
Free Trade Agreement (NAFTA) entered into force. Over the course of the 1990s, Mexico built
on NAFTA in negotiating a series of bilateral and regional trade agreements with other countries
in both the developing and developed worlds (Ortiz Mena 2004).
Mexico experienced partial political liberalization in the 1980s and early 1990s. In the
minds of most observers, and according to the binary definition of Przeworski et al. (2000),
Mexico became a democracy in 2000. In that year, the ruling Partido Revolucionario
Institucional (Institutional Revolutionary Party, or PRI) lost the presidency for the first time in
20 decades. But, according to Marshall, Jaggers, and Gurr’s (2010) Polity IV dataset, which treats
democracy as gradational, there was a gradual increase in the country’s level of democracy
starting in the 1970s. Mexican authoritarianism took the form of a dominant party system, where
elections were held and opposition parties were allowed to campaign, but the PRI used state
funds to finance patronage and disproportionate campaign spending that consistently ensured its
electoral success (Dresser 1991). The system gradually broke down, as opposition parties
became increasingly popular and influential; the PRI’s seat share in the lower house of the
congress steadily declined from 1961 to 2000 (Greene 2007), and opposition parties won a
growing share of sub-national elections. After 1982, conditions of economic crisis and scarcity
further undermined the PRI’s financial privilege. At the same time, secular socio-demographic
and economic changes in Mexico fostered the emergence of an increasingly autonomous and
assertive mass media, important elements of which were strong critics of the ruling regime
(Lawson 2002). In 1988, the threat of losing the presidential election, for the first time in
decades, forced the PRI to resort to widely decried fraud; whether the PRI candidate, Carlos
Salinas de Gortari, really won a majority of the votes cast in that election will never be known.
In short, the Mexican state’s democratic accountability was growing just as it deepened
Mexico’s economic opening and integration into international markets. Mexico therefore fits the
pattern found in the democracy-centered literature.
Its trajectory also, however, fits one of the two pathways—the technocratic one—
outlined by the elite-centered literature. Over the course of the 1980s, U.S.-trained economists
with distinctly market-oriented economic ideas took over the upper echelons of the Mexican
state. This new generation of policymakers gradually displaced their older, more statistnationalist competitors, to the point where much of the federal cabinet consistent of economists
21 with PhDs from elite U.S. universities (see e.g., Babb 2001; Centeno 1997; Thacker 2000). Most
accounts attribute the rise of these technocrats to some extent to the external constraints on the
Mexican state in light of the debt crisis of the early 1980s, and the economic hard times for
several years afterwards. In these circumstances, Mexico grew dependent on the World Bank,
IMF, and private external creditors—constituencies with which technocrats were well placed to
negotiate, and which conversely supported their agendas. According to most qualitative accounts
it was this combination of external structural and financial constraints, and internal activism by
true-believing technocrats, that led to the replacement of Mexico’s inward-oriented
industrialization model with free trade.12
Given the above, was Mexico’s opening a consequence of the state’s growing
accountability to a mass public desirous of economic opening, instead of to privileged
industrialists favoring closure? Or was it a function of technocrats’ policy preferences?
Consistent with the democracy-based view, important elements of the business
community in Mexico were hostile to, or at least unenthusiastic, about economic opening in the
1980s and 1990s. Large nationalized enterprises, such as the state energy company PEMEX, and
many small manufacturers were critical (Johnson Ceva 1998; Shadlen 2000; Thacker 2000). One
negotiator therefore reported that “we had to do [the NAFTA] negotiation with a very
protectionist private sector,” and in his view “the internal negotiation was much more difficult
than the external one.” Another NAFTA negotiator agreed: “there was a very strong opposition.
Because of that, we had to work really, really hard at the consultations … to convince sectors of
the benefits.” A third added that: “Before and during the whole negotiation, there were very
intense debates between the government and private sector—very intense. In whatever area.”
22 And an industry representative focused on the issue of government procurement, for example,
explained that:
As advisers to the government, we had the following position: We don’t want a
chapter on government procurement. … If there is a chapter on government
procurement, it should be [a limited one]. If it’s opened up, we want important
exceptions for sectors like energy, that are fundamental. And we lost it all!
The Mexican state thus faced, and successfully mitigated, the risk of substantial business
dissidence, especially from smaller firms and those supplying state-owned enterprises. However,
larger private firms—whose weight was growing in Mexico’s economy as a whole—were
substantially more enthusiastic (Flores Quiroga 1998; Shadlen 2000; Thacker 2000). And,
though it took some of them until after the formal negotiations had concluded, all of Mexico’s
major national business associations eventually endorsed NAFTA.13 It is not the case, then, that
democratization undermined the power of a domestic economic elite that supported autarky:
Mexico’s very top businesspeople were advocates of opening, as were the key associational
voices bringing together major sectors of domestic business, even if many of their members were
unenthusiastic. Overall, then, the preferences of Mexican businesspeople were mixed, with many
uncertain about their interests.
The malleability of many businesspeople’s views allowed the Mexican state, in tandem
with supportive large business, to cultivate their support. The official private sector advisory
structure set up for the NAFTA negotiations proved especially helpful in this regard. Known as
COECE (Coordinadora de Organismos Empresariales de Comercio Exterior, or Business
23 Coordinating Council for Foreign Trade), one interviewee described this structure as
“fundamental—we had very specific interlocutors for each issue, and we established working
groups, since the beginning of the preparatory work, to review all the issues.” The Mexican state
used COECE to get the private sector involved in the definition of NAFTA’s content, which
gave potential business dissidents a reason not simply to lobby against the agreement in general.
In exchange, as one negotiator put it, “Mexico tried to put on the negotiating table the position of
the private sector.” To participate in COECE, however, firms had to fund their own
representatives; for that reason, and also because of the way that responsibilities were allocated,
bigger business was by all accounts much better represented (Alba Vega 1997; Johnson Ceva
1998; Thacker 1999).
Much like business, the available evidence suggests that Mexicans as a whole were
uncertain about the costs and benefits of economic opening.14 Some public opinion data—from
1990 onwards, regarding NAFTA specifically—suggest that the majority of Mexicans generally
accepted the idea of free trade with the U.S. (e.g., Dyck and Greenfield 1994), with support
highest among higher income earners (Wilson 2001). As a sign of the state’s growing sense of
democratic accountability, in the early 1990s the Salinas administration became the first in
Mexico to hire an in-house pollster, and subsequent polls found majority support for NAFTA.15
On the other hand, far more Mexican respondents to the 1996 World Values Survey favored
“stricter limits on selling foreign goods here, to protect the jobs of people in this country” than
allowing “goods made in other countries [to] be imported and sold here if people want to buy
them” (76 to 16 per cent).
Most importantly, however, there is little evidence to suggest that the preferences of
ordinary Mexicans figured in the state’s pursuit of economic opening. The state’s decisions to
24 propose a free trade agreement with the U.S., to negotiate it, and to ratify it were all largely
orthogonal to public opinion. One interviewee, involved in Salinas’ public opinion polling,
bluntly explained that: “the decision to initiate the process to sign a Free Trade Agreement with
the United States and Canada ... was taken without taking any surveys beforehand. … The
decision did not depend on whether people wanted it or didn’t want it.” On the contrary, “there
was never a direct, immediate rationale for the structural reforms in terms of the effects they
could have on voting. To the contrary. There were two very large concerns. Losing the support
of the PRI itself ... And losing voters.” So when President Salinas instructed his staff to broach
the subject of an FTA with their American counterparts in early 1990, according to interviewees,
they feared a public backlash far more than they expected public enthusiasm, and they made no
announcement about the talks until the media broke the story.
Once the plans went public, opponents of NAFTA rapidly began organizing. A Mexican
Action Network on Free Trade (Red Mexicana de Acción Frente al Libre Comercio, or RMALC)
emerged out of meetings among a small number of academics, trade unionists, and civil society
organizations—plus counterparts in Canada (Massicotte 2001; Calderón and Arroyo 1993). Most
of organized labor in Mexico was closely tied to the PRI, but one alliance of independent trade
unions, the Frente Auténtico del Trabajo (FAT), became a key player in RMALC and provided
funding and office space. While influential among intellectuals and civil society organizations,
these opposition forces were not able to generate a large-scale public debate about NAFTA on
the part of the mass public, however. While the authoritarian Mexican state was prevented from
repressing critics by the threat of non-ratification of NAFTA in the U.S., the state used the
channels of influence at its disposal simply to outweigh them (Poitras and Robinson 1994).
25 Canada
For Canada, even more than for Mexico, the late-twentieth century embrace of free trade
was centered on the negotiation of a specific agreement with the United States. Like Mexico,
Canada had historically sought to restrain, rather than deepen, its relationship with its much
larger neighbor. But once it stopped rejecting the idea of bilateral free trade, foreign trade and
investment expanded rapidly relative to GDP. The Canada-U.S. bilateral free trade agreement
(CUFTA) went into effect at the start of 1989, five years before the trilateral NAFTA. From a
Canadian perspective, NAFTA was largely an extension and expansion of the earlier bilateral
agreement, and it was CUFTA that embodied an enormously controversial policy change in
Canada. The public debate about it in the late 1980s was intense, and arguably more so than for
any other international economic policy change in Canada’s history.
Like for Mexico, causal process observations from the Canadian case are consistent with
one of the elite-centered arguments discussed above—though in the Canadian case, the
originating advocates of free trade were based in the private rather than public sector.
Canada’s post-World War II international economic policies were broadly liberal, but
less so than the median developed country.16 While many Canadian bureaucrats and politicians
were sympathetic to economists’ arguments for free trade—and leading academic economists in
Canada were strongly supportive of free trade both generally and with the U.S. specifically
(Economic Council of Canada 1975; Johnson 1968)—Canadian business was not. The result was
a sometimes hostile standoff between the private and public sectors over the issue of Canada’s
economic openness, with opposition to freer trade being particularly rooted in the manufacturing
sector. Only in the early 1980s did Canadian manufacturers became much more sanguine about
26 their ability to thrive in international markets, and with their reversal of views, the Canadian
private sector as a whole became very motivated to pursue a bilateral Canada-U.S. free trade
agreement (Richardson 1992; Langille 1987). Between the late 1970s and the mid-1980s, the
preferences of Canadian business changed substantially. In 1977, the Canadian Manufacturers’
Association (CMA) stated that “at this stage in Canada’s development as an industrial nation, our
industry is in general not as capable of benefiting from trade concessions gained as it is
vulnerable to trade concessions granted.” By 1984, the CMA had substantially changed its tune,
saying “Canadian industry needs further multilateral trade liberalization… Moreover, it needs to
[give] consideration to entering into a trade agreement with the U.S.” Although some previous
studies have found sectoral divides with respect to free trade, starting in the early 1980s the
business community in Canada became strongly united in favor of greater opening, with the few
dissenters being relatively small industries (e.g., furniture, wine). The catalyzing event was the
early 1980s recession, which was not only economically damaging to Canadian firms, but also
produced a brief spike of protectionist sentiment in the U.S., leading some Canadian exporters to
fear for their access to their most important foreign market. One business association interviewee
summed up that “it's in that recession, in the early 80s, that the understanding of the economics
of Canadian manufacturing started to change.”
The shift in business priorities reflects the growing robustness of the Canadian corporate
sector. Several authors have noted how, after a nadir in the early post-World War II period, by
the 1970s Canadian firms were starting to invest substantially more abroad and to some extent
retaking control from foreigners at home (e.g., Niosi 1981), and that trend continued (Carroll
2004). Rather than a defensive posture in the face of foreign (especially American) corporate
dominance, in the 1980s Canadian business adopted an outwardly oriented, even aggressive
27 perspective, perceiving international markets as opportunities rather than threats. Canada’s
experience is thus consistent with Japan’s, for example, on which basis Yoshimatsu (2000: ix)
concludes that “as firms strengthen international linkages in the form of multinational operations
and international corporate alliances, they become more committed to trade liberalization of the
global market.”
It was in 1985, soon after it became clear that the trade policy preferences of the
Canadian business community had changed dramatically, that the Progressive Conservative
(“Tory”) government of Prime Minister Brian Mulroney accepted a long-standing tacit invitation
from the U.S. to negotiate a bilateral free trade agreement. Before taking that step, the
government consulted extensively with horizontal and industry-specific business associations
(Simeon 1987), such that, as one business association leader put it, Mulroney “took what was
generally seen as a political risk for the country as a whole, but … not a political risk in terms of
being in tune with the business community. In fact, quite the opposite.” The same interviewee
confirmed that the CMA “adopted a position fully and aggressively supporting the free trade
negotiations, which was diametrically opposed to the historical position of the association.”
Private sector priorities—above all secure export access to the U.S. market—heavily
shaped the government’s priorities in the subsequent negotiations. Business campaigning for free
trade was extensive before, during, and after the negotiations, and dovetailed with a longstanding enthusiasm for the idea on the part of liberal-minded bureaucrats in Ottawa, as well as
outside economic policy experts in Canadian universities and think tanks (Golob 2003). The
Tory government had numerous ties to the private sector, shared many of its views, and
generally sought to pursue business priorities as a matter of course (Watson 1987).
28 Business support for free trade was therefore substantial in Canada—significantly
stronger and broader than in Mexico during the creation of NAFTA. What though of Canadian
public opinion, and the state’s accountability to it?
CUFTA’s passage came to depend on the re-election of the Tory government that
negotiated the agreement between 1985 and 1987. In the federal parliamentary election of 1988,
only the Tories promised to enact the agreement if elected; the other two major parties (the
Liberals and New Democrats) made their opposition central to their platforms. Their opposition
was shared by a civil society alliance, known initially as the Pro-Canada Network, and later as
the Action Canada Network (see Ayres 1998). This alliance emerged out of meetings between
the Canadian Labour Congress and a left-nationalist association known as the Council of
Canadians, and also organizing by church-based activists.17
As the election campaign unfolded, the free trade agreement became the main debate and
issue—a rare instance where trade became a salient public concern. In the end, the Tories were
successfully re-elected, with more than half the seats in the parliament—but only a plurality (43
per cent) of the popular vote. The centrist Liberals and labor-allied New Democrats received 32
and 20 per cent of the popular vote respectively: a majority, if combined. There is good reason to
think that these vote shares derived in substantial part from people’s opinions of free trade: a poll
taken in the same month as the election found 39 per cent support and 51 per cent opposition to
the FTA (LeDuc 1989). The evidence about public opinion does not therefore suggest that the
Canadian electorate supported the principle policy change by which Canada adopted regional
free trade in the late twentieth century. CUFTA would not have passed had public opinion alone
determined its fate.
29 Public support would likely have been even lower, however, but for substantial business
campaigning for free trade between 1986 and the 1988, and during the 1988 election campaign.
The country’s three major business associations—the Canadian Manufacturers’ Association,
Canadian Chamber of Commerce, and the Business Council on National Issues—joined and
campaigned together, through an alliance they called CATJO (“Canadian Alliance for Trade and
Job Opportunities”—see Ayres 1998; Doern and Tomlin 1991). As the Prime Minister’s thenChief of Staff writes in his memoirs, in the 1988 election “the business community rallied in
unprecedented fashion to demonstrate support for the agreement” (Burney 2005). Or, as a
business association leader, put it, “the manufacturing community fought on [Mulroney’s] side.”
During the negotiation and ratification of NAFTA in the early 1990s, public opinion in
Canada turned even more negative about free trade. The Canadian economy went into recession
just as it was beginning to adjust to new market conditions under CUFTA. In 1993, 33 per cent
of respondents to one survey reported supporting free trade, while 60 per cent were opposed;
regarding the then still-to-be-enacted NAFTA, 23 per cent were in favor and 69 per cent were
opposed.18 Survey respondents with more education and higher incomes tended to be more
supportive (Mendelsohn and Wolfe 2001).
Conclusions
In Canada, economists’ views about the desirability of free trade did not change over
time, bureaucrats’ views changed little, the views of business changed a great deal, and the
priorities of politicians followed those of Canadian business. The pattern of changes over time
differed substantially from the pattern in Mexico, where business views evolved little (remaining
30 mixed), and the priorities of politicians and top bureaucrats evolved dramatically, as technocrats
replaced previous generations of political elites. In neither case, however, was the state’s
democratic accountability an important impetus to free trade. Mexico’s technocrats were so
concerned about a public backlash that they delayed announcing their intention to pursue free
trade with the U.S. for as long as possible; in Canada, if anything, public opinion weighed
against North American free trade—though support increased later in the 1990s (Mendelsohn
and Wolfe 2001).
More generally, in the typical country public opinion is mixed about free trade; the highly
educated are consistently supportive but other people are not; voters are generally uninformed
about international economic policies; and what preferences people do have in this domain do
not make much difference to how they vote. Both generic and case-specific causal process
observations therefore belie the proposition that mass public opinion and/or voters’ demands
drive the policy changes that open national economies to international markets.
Instead, arguments about the power of elites are more convincing—though the relevant
elites vary across national contexts, given the important political economic differences between
developing and developed countries in particular. Contrary to the implications of some studies
(e.g., Harvey 2005; Richardson 1992), free trade is not always a project of business, and business
is not always in favor of free trade. In Canada, prior to the 1980s, the national business
community—particularly given the strong views of manufacturers specifically—was hostile to
free trade. In Mexico, free trade was a project of the state—under the guidance of neoclassical
economic technocrats—not the private sector, the latter being internally divided and thus as a
whole relatively passive.19
31 Given the above, the case for a causal relationship between democracy and free trade is
questionable. Nevertheless, the statistical association between them remains to be explained. In
this regard, it would be useful for future research to address the possibility that the association is
due to the presence of some common driver of both democratization and free trade. One
possibility is that the rise of certain kinds of political elites in authoritarian states, such as
technocrats with substantial previous exposure to world culture, may create the conditions for the
adoption of free trade and subsequent transitions to democracy. Both democracy and free trade
could be more likely to occur in countries with greater exposure to a world culture sympathetic
to political and economic liberalism (Finnemore 1996). One key means by which world culture
is transmitted is epistemic communities, or groups of recognized experts (Simmons, Dobbin, and
Garrett 2006). The relative population of such experts varies from country to country, as does
experts’ freedom to travel or study abroad, and thereby to absorb norms and ideas which they
may import back home. It would not be surprising if the same non-democracies that came to be
governed by technocrats—highly educated individuals exposed to foreign expertise and ideas—
were also more likely to transition to democracy. The highly educated tend to be strong
supporters of both state accountability and free trade (Hainmueller and Hiscox 2006), such that
while technocracy only emerges in non-democratic contexts, many technocrats may nonetheless
believe in the value of democracy, and be more likely to introduce it.20 Once they gain power,
and perhaps implement some of their highest-priority economic policy changes, they may take
steps to transition to democracy. Or they may at least be less likely to use violence in repressing
popular demands for democracy, setting technocratic non-democracies apart from other, more
intellectually and economically autarkic nations. It is because of this possibility, at least, that the
32 statistical association between democracy and free trade is by itself not conclusive evidence of a
causal relationship.
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1
Trade and direct investment are distinct, but often linked through their inclusion in the same agreements,
and for reasons explained further below, explanations of their recent liberalization have been similar.
2
The dataset, described and made available in Wacziarg and Welch (2008), is an updated and refined
version of Sachs and Warner’s (1995).
3
The binary measurement of economic opening reflects that countries have tended to make transitions to
free trade at distinct and identifiable moments in their histories, such as in acceding to GATT or
negotiating and ratifying an agreement with one or more sizeable neighbors. Binary classifications are not
perfect, but neither are other possible indices (Milner and Kubota 2005: 122-3). Tariff rates alone do not
reflect important non-tariff barriers (Kono 2006), and it is not straightforward to combine tariffs and nontariff barriers into a single summative index.
4
These figures come from UNCTAD’s Foreign Direct Investment on-line database.
45 5
Studies of trade and investment liberalization have also pointed to a variety of influences not otherwise
addressed here, including domestic electoral institutions, party cleavages, and economic geography (for a
review see Busch and Mansfield 2010). These other arguments have however focused much more on
differences across the treatment of industries within a given country, or differences across countries, at a
given point in time. As explanations of change over time within countries, existing literature has placed
primary emphasis on the influence of political democratization, or of elite action.
6
Many studies do not define provide formal definitions of democracy, but simply work with measures
from large datasets like Polity IV and Freedom House, which concentrate on procedural and institutional
criteria like the existence of elections and constraints on the executive, or on the protection in practice of
political rights. I adopt this approach here as well.
7
Underscoring its importance, Goldberg and Pavcnik (2007: 58) call the Heckscher–Ohlin model “the
best known general equilibrium model of international trade”.
8
Consistent with this view, for example, Rudra (2005a) finds that the bargaining power of labor has
declined as economic openness has increased across most of the developing world.
9
Margalit (2012) and Ehrlich and Hearn (2013) also demonstrate the sensitivity of measured public
opinion to various kinds of survey stimuli.
10
Other studies link policy preferences to psychological and/or cultural factors (e.g., O’Rourke and
Sinnott 2001).
11
Canada was a broadly open economy even before the 1980s. But the stark differences between its
policies before and after the 1980s make for a useful comparison with cases of transition in developing
countries.
12
The Mexican negotiators hoped NAFTA would attract more foreign investment to Mexico, and so
accepted a series of U.S. demands for business-friendly intellectual property and investor rights, as well
as disciplines on interventionist policies in these areas. These measures, which have been replicated in
46 various ways globally and/or in other agreements, have subsequently been decried as constraints on
legitimate public policies and on democratic governance (Clarkson 2002; McBride 2006; Shadlen 2005).
13
The National Chamber of the Manufacturing Industry (Cámara Nacional de la Industria de
Transformación, or Canacintra) was divided by the process of opening in the 1980s, with a splinter group
forming a rival association (Shadlen 2000). But even Canacintra eventually endorsed NAFTA, in 1993.
14
An important exception in this regard may be for labor mobility.
15
Some of the resulting datasets are now available from the Centro de Investigación y Docencia
Económicas in Mexico City.
16
Hart (2002: 75) notes that until the Canada-U.S. free trade agreement of the 1980s, the “basic
orientation” of Canadian trade policy included a heavy dose of protection.
17
Church-based activism in Canada latter would also prove instrumental, in the early 1990s, in the
alliance-building with Mexican dissidents critical of NAFTA.
18
POLLARA: Canada Perspectives, Quarter 3, 1993. N=1100.
19
Since NAFTA, political and economic elites have proposed further forms of “deep integration” (on
which see for example the volume edited by Grinspun and Shamsie 2007). For the most part, Mexicans
and Canadians warmed on free trade after the implementation of NAFTA (Mendelsohn and Wolfe 2001;
CIDE, COMEXI, and the Chicago Council on Foreign Relations 2004), though somewhat less so on
“globalization” than “trade agreements” (Wolfe and Mendelsohn 2004). Mendelsohn and Wolfe (2001:
237) argue that even after CUFTA and NAFTA "Canadians do not think or know that much about trade,"
and that “the public possesses little information about foreign affairs generally and about trade
specifically” (ibid., 242).
20
Bernhard and Karakoç (2007) find that education is positively associated with participation in both
organizational life and political protests.