Arresting the Opposition: Free Trade and Labor Unions in Developing Countries

• In Event: Labor and Firms in the Global Economy

Abstract

Why, at the turn of the twenty-first century, did country after country in the developing world open their economies to the global market? This paper places labor unions and government repression at the heart of the debate over trade liberalization in developing countries. It argues that the move towards free trade involved a top-down democratization process that empowered export-oriented businesses but silenced the demands of protectionist labor unions. In contrast, bottom-up democratization led by labor unions led to a continuation of trade protection. This paper supports these arguments with a multi-method approach that combines qualitative case studies of Argentina, Bolivia, and India with quantitative analysis of data from 126 developing countries from 1985 to 2010. In general, the empirical evidence suggests that the move towards free trade in developing countries was resisted by labor unions, and only proceeded in democratic countries to the extent that such opposition was repressed.

Author

• Adam Dean, George Washington University