North American Free Trade: Issues and Recommendations

By Gary Clyde Hufbauer; Jeffrey J. Schott | Go to book overview

Preface

International trade negotiations have been one of the focal points of research at the Institute for International Economics throughout its history. At the request of then-United States Trade Representative Bill Brock, Gary Clyde Hufbauer and Jeffrey J. Schott developed one of the initial blueprints for the Uruguay Round in Trading for Growth:The Next Round of Trade Negotiations ( 1985). Schott subsequently offered a midcourse assessment in Completing the Uruguay Round:A Results-Oriented Approach to the GATT Trade Negotiations ( 1990). Paul Wormacott prepared a blueprint for the Canada-US Free Trade Agreement in The United States and Canada:The Quest for Free Trade ( 1987), and Schott's United States-Canada Free Trade:An Evaluation of the Agreement ( 1988) was used extensively in the ratifickion debate in both countries. Schott's Free Trade Areas and U.S. Trade Policy ( 1989) examined the prospects for additional regional pacts, including one between the United States and Mexico.

Hufbauer and Schott drew on these previous analyses in preparing the current study, the most comprehensive to date of the proposed North American Free Trade Agreement (nafta). They address the aggregate economic effects of such an arrangement, its six key functional components, and the six sectors that would be most significantly affected. They draw implications for each of the three countries involved and for the world trading system as a whole, including how a nafta could affect the balance between globalism and regionalism in trade policy in the 1990s and beyond. Building on this analysis, Hufbauer and Schott will examine in a forthcoming Institute study the prospects for free trade in the Western Hemisphere along the lines proposed by President George Bush in his Enterprise for the Americas Initiative.

The Institute for International Economics is a private nonprofit institution for the study and discussion of international economic policy. Its purpose is to analyze important issues in that area, and to develop and communicate practical new approaches for dealing with them. The Institute is completely nonpartisan.

The Institute is funded largely by philanthropic foundations. Major institutional grants are now being received from the German Marshall Fund of the United States, which created the Institute with a generous commitment of funds in 1981, and from the Ford Foundation, the William and Flora Hewlett Foundation, the William M. Keck, Jr. Foundation, the Alfred P. Sloan Foundation, the C. V. Starr Foundation, and the United States-Japan Foundation.

Support for the present study was provided by the Charles R. Bronfman Foundation, the John D. and Catherine T. MacArthur Foundation, and The

-xi-

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North American Free Trade: Issues and Recommendations
Table of contents

Table of contents

  • Title Page iii
  • Contents v
  • Preface xi
  • Board of Directors xiv
  • Acknowledgments xv
  • I - The Political Eonomy of a NAFTA 1
  • 1 - Nafta: Overview and National Objectives 3
  • 2 - The Substantive Agenda and Implications for Nonmember Countries 23
  • II - Economic Implications 45
  • 3 - Trade Effects of a Nafta: a Survey 47
  • 4 - Investment 71
  • 5 - The Maquiladora Phenomenon 91
  • 6 - Labor Issues 107
  • 7 - Environmental Questions 131
  • 8 - Rules of Origin 155
  • 9 - Intellectual Property Issues 173
  • III - Sectoral Analyses 183
  • 10 - Energy 185
  • 11 - Automobiles 209
  • Appendix - Motor Vehicle and Parts Manufacturers in Mexico 234
  • 12 - Steel 243
  • 13 - Textiles and Apparel 263
  • 14 - Agriculture 279
  • 15 - The Mexican Financial System 305
  • IV - Summary and Conclusions 327
  • 16 - Summary and Conclusions 329
  • References 345
  • Index 361
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