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The New Political Economy of Trade: Understanding the Treatment of Non-Tariff Measures in European Union Trade Policy

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The New Political Economy of Trade: Understanding the Treatment of Non-Tariff Measures in European Union Trade Policy The London School of Economics and Political Science The New Political Economy of Trade: Understanding the Treatment of Non-Tariff Measures in European Union Trade Policy Elitsa Garnizova A thesis submitted to the Department of International Relations of the London School of Economics for the degree of Doctor of Philosophy, London, November 2018 Page 1 of 324 Declaration I certify that the thesis I have presented for examination for the MPhil/ PhD degree of the London School of Economics and Political Science is solely my own work other than where I have clearly indicated that it is the work of others (in which case the extent of any work carried out jointly by me, and any other person is clearly identified in it). The copyright of this thesis rests with the author. Quotation from it is permitted, provided that full acknowledgement is made. This thesis may not be reproduced without my prior written consent. I warrant that this authorisation does not, to the best of my belief, infringe the rights of any third party. I declare that my thesis consists of 115,854 words; 99,109 excluding Table of Contents, Bibliography and Appendices. Statement of use of third party for editorial help I can confirm that Chapter 1 was copy edited for conventions of language, spelling, and grammar by Bregtje Kamphuis, and Chapters 2 and 3 were edited by Dr Marina Cino-Pagliarello. Page 2 of 324 Abstract Non-tariff measures have become a central topic to the debate of how international trade rules and domestic regulatory choices are to co-exist. They are an essential feature of the trade in goods and services, investment, and public procurement regimes. Moreover, different ideas on what is fair and legitimate and how this is justified co- exist. The evolution of the inclusion of non-tariff measures can be explained by rational choice explanations looking at the changed composition and patterns of trade and resulting domestic-international dynamics. However, this explanation is only partial since it does not tell us which factors explain the different understanding of non-tariff measures and how this varies in different periods and contexts. While the constructivist literature and mainly, the literature on the role of ideas in EU trade policy have brought a stronger understanding of the content and influence of ideas, we are still missing an understanding of the content and ideas vis-à-vis non-tariff measures and regulatory issues due to the principal focus on neoliberal ideas. The dissertation aims to provide a theoretically and empirically grounded analysis of the policy process behind what we term negotiability or the overlap between what agents perceive as negotiable in the coordinative and communicative discourse. Through a combination between theory-induced and data-induced thematic and discourse analysis, we identified which factors affect negotiability. The empirical material uses a combination of primary sources, official EU documents, and in-depth elite interviews. Building on existing ideational theories, we show how two different problem definition of non-tariff measures as regulatory protectionism and as regulatory heterogeneity affect their treatment and lead to discrimination across partners. Drawing on existing theories about ideational change, we also show the meeting between the trade and regulatory regimes have brought slow, gradual change in EU trade policy through inconsistencies, ad-hoc processes, and experimentation thus creating space for discontinuities in neoliberal ideas. By analysing the international political economy causes of the treatment of non-tariff measures, we contribute new aspects to EU trade policy and on the role of ideas in understanding change-continuity. Page 3 of 324 Table of Contents Declaration ................................................................................................................... 2 Statement of use of third party for editorial help ..................................................... 2 Abstract ........................................................................................................................ 3 Table of contents .......................................................................................................... 4 List of Tables................................................................................................................ 7 List of Figures .............................................................................................................. 7 List of Boxes ................................................................................................................ 7 Acknowledgements ...................................................................................................... 8 List of abbreviations ................................................................................................... 13 Chapter 1. Introduction .............................................................................................. 16 1.1. ‘Tilting at windmills’ or how to think about non-tariff measures? ............. 16 1.2. The social construction of trade barriers ..................................................... 19 1.2.1. Defining non-tariff measures ............................................................... 19 1.2.2. A natural development in trade policy? ............................................... 20 1.2.3. What should trade negotiators negotiate about? .................................. 23 1.2.4. Research question and the argument in brief ....................................... 27 1.3. Existing explanations to the ‘regularising’ trade landscape ........................ 30 1.4. Summary of methodological, empirical and theoretical contributions ....... 42 1.5. Thesis outline .............................................................................................. 45 Chapter 2. Theoretical framework ............................................................................. 48 2.1. Introduction ................................................................................................. 48 2.2. The changing character of trade negotiations .............................................. 51 2.3. Theorising ideational development ............................................................. 55 2.3.1. Levels of ideational analysis ................................................................ 57 2.3.2. Constitutive versus causal ideas ........................................................... 60 2.3.3. Relationship between different levels of ideas..................................... 61 2.3.4. Ideational transformations .................................................................... 62 2.4. Neoliberalism and public philosophies ....................................................... 63 2.5. Regulatory protectionism and regulatory heterogeneity as policy programmes ............................................................................................................ 69 2.6. Regulatory cooperation and other policy ideas ........................................... 72 2.7. Summary of theoretical argument: movement from policy solution to problem definition to public philosophy ................................................................ 79 2.8. Concluding remarks .................................................................................... 82 Chapter 3. Research strategy ...................................................................................... 83 Page 4 of 324 3.1. Rationale for the choice of a single case study and justification of the choice of periods ................................................................................................................ 83 3.1.1. Choice of European Union’s trade policy as a single case study ......... 83 3.1.2. Choice of periodisation ........................................................................ 86 3.1.3. Choice of non-tariff measures and regulatory issues ........................... 89 3.1.4. Choice of constructivist approach ........................................................ 92 3.2. Research Design .......................................................................................... 95 3.3. Induction, Interpretation and Historicising ................................................. 97 3.3.1. Interviews ............................................................................................. 97 3.3.2. Thematic analysis ............................................................................... 100 3.3.3. Discourse analysis .............................................................................. 101 3.3.4. Process tracing from a constructivist perspective .............................. 102 3.4. Operationalisation and observable implications ........................................ 103 3.5. Robustness of the research design ............................................................. 109 3.6. Self-reflection on interviewee-interviewer dynamic ................................. 111 Chapter 4. Trade and regulation in an institutional and historical context .............. 112 4.1. From theory to practice ............................................................................. 112 4.2. Policy programmes and EU trade policy ................................................... 115 4.3. Policy ideas and discretion of the European Commission ........................ 125 4.4. Actors involved in EU’s trade policy ........................................................ 129 4.5. Implications
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