Skip to main content

Research Objectives

The research aim of CCD is to understand the causes and consequences of the institutions of trade diplomacy. Diplomats operate within a set of domestic and international institutions that govern their behavior in international trade negotiations. But we have little systematic knowledge about the specifics of these rules and procedures, how they came into being, how they vary over time and across countries and how they affect economic outcomes.


In the United States, Congress enacted Trade Promotion Authority (TPA) in 1974 to structure the process of trade negotiations. TPA, which is also known as “fast-track”, stipulates the negotiating objectives for U.S. trade diplomats, spells out a consultation and reporting process for diplomats to keep Congress and the business community informed during trade negotiations, and establishes an expedited procedure for Congress to pass implementing legislation.

TPA has been renewed four times by Congress and has been used to successfully conclude 14 free trade agreements and two multilateral GATT/WTO rounds since 1974. Yet despite the importance of this legislation, scholars have all but ignored the institutional details of the TPA and each of its four renewals.

The same lacunae holds for TPA’s predecessor – the Reciprocal Trade Agreements Act (RTAA) of 1934. Between 1934 and 1945, RTAA was used by U.S. presidents to negotiate 32 bilateral trade agreements with 27 countries. n 1947, the U.S also negotiated the GATT under the authority of the RTAA. The RTAA was renewed 12 times before being superseded by TPA, yet no scholarship has examined the causes and consequences of changes to the RTAA over its history.

Questions Asked Today

Given this lack of scholarship, our initial set of empirical research questions asks how does the negotiating process and outcome differ with changes in congressional legislation on trade diplomacy? More specifically, for every renewal of the RTAA, and for every change in the TPA, we seek answers to questions that fall into three major categories:

Drivers of the Change

  • Who were the authors of bills introducing the change?
  • Which legislators voted for the bills and why?
  • How do legislators votes for bills change over time?

Procedural Changes Enacted

  • Who is empowered to negotiate on behalf of the U.S. and what is their rank and title?
  • What type of agreements are allowed: bilateral, regional or multilateral?
  • Are negotiations with specific countries or regions allowed or disallowed?
  • What negotiation objectives, broad-based or sector-specific, are defined by Congress?
  • What are the procedures for notification and consultation with Congress?
  • What are the procedures for notification and consultation with private-sector actors?
  • What type of expedited procedures for implementing legislation are stipulated? These may include (1) mandatory introduction; (2) automatic discharge from the committees of jurisdiction; (3) time-limited floor debate; and (4) an “up or down,” simple majority vote.

Economic Outcomes

  • How did trade policy (tariff and non-tariff barriers) change and for which sectors?
  • How did transfers (or compensation) to negatively affected industries change?
  • How did regional/sectoral imports and exports change?
  • How did regional/sectoral productivity/output change?
  • How did productivity/output change for small/medium/large businesses?

Research Aim

A broader aim of this research is to shed light on the process of institutional change. We have a gap in our understanding of how and why trade policymaking institutions change when rational actors are selecting these institutions. One approach, which we will explore theoretically, is that institutional change arises when a state of the world is realized for which there is no prescribed action under the existing institution. This may be because the state was unexpected (a shock), it was too costly to describe this state in the initial institution (contract incompleteness), or agents chose to ignore such states in the institutional design (rational inattention).

The questions to be asked in this setting are:

  • What are the equilibrium institutions that arise?
  • How do these institutions change and how is this affected by the status quo institution?
  • What conditions lead to the persistence of "good" institutions?

The overall objective of the CCD is to have a better understanding of how institutions of trade diplomacy affect commercial and diplomatic interests. This will help answer questions about the welfare and distributional consequences of trade policy institutions and, ultimately, result in the better design of these institutions.