Members of the WTO use the system to improve governance among nations such as Russia that want to join this rules based system. Working parties comprised of other WTO member states closely monitor potential members, and make sure these nations meet their commitments. Once these acceding nations become members, they are monitored through trade policy reviews and can be challenged in a trade dispute. In short, the WTO has a feedback system to hold members to account for their trade practices and governance commitments. Policymakers have termed this process of using membership as a lever to improve governance “policy anchoring” (Francois 1996; Bachetta and Drabek 2002; Basu 2008).
To ascertain when policy anchoring occurs, we divided countries into four groups: countries We call the first group nonmembers: it includes countries that never joined the WTO as well as countries that are attempting to join but have not yet been accepted. Some of the nonmembers completed their accession negotiations during our period of study; we label them the completed negotiating group. Countries that have gained approval to accede must then must gain domestic approval (which may take several years) to join the WTO. If they succeed, they become part of the new members group (countries that became members after 1995 (we note that our data begins in 1996). Finally, we call nations that joined the GATT between 1948-1995 longstanding members. Because our period of study extends from 1996-2011, a country such as Cambodia could be a member of three different groups, moving from nonmember to completed negotiations (2003) to new member (2005).
We found that nations change their laws and policies to join the WTO during and after the accession process. Countries that successfully negotiate to join the WTO exhibit improved performance on metrics of evenhandedness and access to information during the negotiating process, but we did not find commensurate improvements in performance on metrics of due process. New members showed mixed effects, while this group generally improved their performance on metrics to access to information, evenhandedness weakened in new WTO members and we found no significant effects with metrics of due process. Moreover, longstanding members improved their performance on accession to information and due process, but evenhandedness did not improve. In sum, the WTO’s effect on governance was uneven–policymakers improved their performance on these metrics some of the time. Interestingly, because our data is not limited to governance in the trade regime but covers the polity as a whole, our empirical evidence provides partial support for our hypothesis that the norms of good governance promoted by the WTO transcend the trade sphere and affect the country’s approach to governance in general.
