A restricted scope
The scope of the GATT negotiations was largely confined to manufactures. All three of
the big negotiating blocs were major producers of manufactures and had the potential to
be major exporters to each other. Liberalization offered each bloc the chance to reap
economies of scale within manufacturing, raising efficiency without contracting the
sector. The resource reallocations triggered by liberalization were thus intra-sectoral.
Further, for much of the period growth was rapid and so these intra-sectoral adjustments
could be accommodated within the context of overall expansion. This restriction of scope
to manufacturing made the negotiations much easier. Being confined to a single sector,
the effects of a liberalization were basically common to all participants. Further,
manufacturing was an easy sector because there were large and well-understood
economies of scale, and because factor mobility within the sector was high. Notably, the
GATT did not attempt to negotiate agricultural liberalization among its members.
With the historical moment in its favor, a membership restricted to willing liberalizers,
and the scope restricted to a single, easy sector, the GATT was hugely successful. By the
time it was transformed into the WTO, intra-OECD manufacturing trade was virtually