Trade Packages: Making Trade Agreements Work in the Service of Society

International trade agreements typically benefit the national welfare of the nations that sign them. However, they also generate economic displacements as well as negative social and environmental spill-overs. The traditional approach to address these negative spill-overs has been to rely on domestic flanking policies, which are de-linked from the trade agreement itself. This approach, however, has not always worked well. Too often trade has been liberalized internationally, but domestic lawmakers have failed to enact the needed measures to address economic disruptions and spill-over effects on the environment and society. This has sapped the support for trade. Popular resentment of 'globalisation' has driven anti-trade sentiments to heights not seen since the 1930s in key geographies. A trend that has been intensified further with the COVID-19 Pandemic. This is having serious consequences for the multilateral trading system. Although some rebalancing may be needed, the risk is that moves towards de-globalisation compromise the massive benefits that open trade have brought to countries. This project will explore if and how trade agreements could become a vehicle to address these spill-overs more directly by including the necessary flanking policies that offset the negative effects either (i) in the trade agreement itself or (ii) anchored in the domestic legislation implementing the trade agreement (hereafter "package treaties"). The project is inspired by early examples of such inclusions in recent trade agreements. There is a need for an innovative and interdisciplinary effort (international economics, law, and relations) to further explore such tools for trade and identify if and how these modalities can be politically realistic and socially effective for "packaging" trade agreements, be it in the agreement itself or its domestic implementation, with complementary policies in ways that pre-empt, minimise or redress the disruptions. The findings have the potential of reshaping the way future international trade agreements are developed and how domestic trade policy can be anchored to required flanking policies.This project will fill important gaps in the literature, by expanding on emerging scholarship on package treaties by: (i) Offering a deeper understanding of the spill-over effects that trade agreements have on jobs, income distribution, the environment, and gender. We will develop recommendations on how to integrate ex-ante impact assessment tools into the scoping and negotiating process to better account for spill-over effects on job, income distribution, the environment, and gender. (ii) Mapping out the different ways countries have addressed (or not) spill-over effects when they adopted international trade treaties. We will produce a database of flanking provisions that have been "packaged" in trade agreements or domestic implementing legislation to address the spill-overs, illuminate the domestic political dynamics behind those choices, and seek to understand the reasons why in other cases negative spill-over effects are not adequately addressed at the domestic level. (iii) Exploring the effectiveness and practicality of trade packages as a tool to address the spill-over effects. We will develop in-depth case studies of the various models of existing "package" trade agreements, explore their pros and cons, trace their ensuing effects, and assess their consequences. We will also explore why package treaties have not been used in other specific cases. (iv) Developing recommendations on if and how package treaties could be further used, considering economic and political optimal fits with different individual national solutions, and highlighting their advantages and challenges. The results will be published into at least: two special issues/edited interdisciplinary book volumes on package treaties, four co-authored peer reviewed articles, three related doctoral theses, a stand-alone database of flanking policies, working papers and policy briefs, two large conferences on "package treaties", etc.The three co-applicants: Richard Baldwin (Professor of International Economics), Joost Pauwelyn (Professor of International Law) and Cedric Dupont (Professor of International Relations) bring extensive, complementary experience and past experience working together. They will work with a team of three Post-Doc researchers and three Phd students.