asioworski (1986), and Russett et al (1998), have found that increases in trade flows among countries (or between pairs of them) decrease the chances that those countries will be involved in political or military conflicts with each other. Others, such as Waltz (1979) and Barbieri (1996), argue that increased trade and the interdependence it creates either increase conflict or have little effect on it. One way the rush to free trade might affect the international politi- cal system, then, is by increasing or decreasing the level of political-military conflicts. The different arguments, however, imply different feedback mecha- nisms. If trade promotes pacific relations among trading nations, then such a pacific environment is likely to stimulate further trade liberalization and flows; on the other hand, if trade produces more conflict, then we might expect more protectionism and less openness in the future.
These more dynamic models of how international trade and domestic poli- tics interact are an important area of research. They may tell us a good deal about what the rush to free trade, if sustained, may mean for the future. Will the global liberalization process bring increasing pressures for more openness and for democracy? Or will it undermine itself and breed demands for closure and a backlash against governments and the international institutions that support openness? Will openness produce a peaceful international system or one prone to increasing political conflict? The answers to these questions will in turn tell us much about the future direction of trade policy globally.
CONCLUSION
The question that I set out to address was why nations around the globe have liberalized their trade policies since 1980. I examined the preeminent theories of trade policy to see if they could help explain this monumental shift in policy. In this section I assess how well they have done and where future research might be useful.
Why have trade barriers been declining globally since 1980? Existing theories suggest at least three plausible answers. The first involves changing preferences about trade policy among domestic actors. Clearly, in the 1980s, many political leaders and some societal groups in countries around the globe changed their views on what their best trade policy choice was. Political lead- ers in the LDCs launched ambitious, unilateral economic reforms that included massive trade liberalization, while leaders in the advanced industrial countries undertook large-scale, multilateral efforts to reduce trade barriers. For the lat- ter group, it is hard to pinpoint changes in political institutions or democrati- zation as playing a major role. Instead, the virtuous cycle—growing trade cre- ating more groups in favor of trade liberalization, which in turn created more impetus for greater liberalization and more trade—seems to be a key factor. For the LDCs, on the other hand, changes in leaders’ preferences and in politi-
cal institutions appear more important. The failure of ISI, economic crises, the success of the relatively open Asian NICs, and the demise of a socialist al- ternative all combined to make leaders favor economic reforms that included trade liberalization. Democratization in some countries also fostered this pro- cess. Large-scale changes in political institutions, especially in the direction of democracy, may be necessary for the kind of massive trade liberalization that occurred in some LDCs. But changes in preferences cannot be overlooked in explaining the rush to free trade.
One might think that international factors would play a major role in this
global change in policy. But it is harder to argue this. Certainly, the collapse of socialist and communist economies, which was part and parcel of the end of the Cold War and the demise of the Eastern bloc, had an effect. Leaders could no longer plausibly appeal to such models to justify their protectionist policies. But it is important to remember that many of the unilateral reforms toward lib- eralization began in the early or mid 1980s, before the collapse of the Eastern bloc. They also began at a time when many observers thought American he- gemony was long past, especially economically. Perhaps most important was the role of international institutions. For the advanced industrial countries, the GATT allowed countries to design wide-ranging packages of reciprocal trade concessions that fostered broad liberalization; in addition, the EU helped pro- mote liberalization within an ever-growing Europe. For the LDCs, the role of the IMF and World Bank may have played a larger role. Economic distress forced countries to turn to these institutions for help, and part of the price was a prescription of trade liberalization. Although for some leaders this prescription fit with new trade preferences, for others it was a bitter pill to swallow and one they would not have taken without external pressure.