Hostname: page-component-cd9895bd7-7cvxr Total loading time: 0 Render date: 2024-12-22T16:27:04.578Z Has data issue: false hasContentIssue false
  • English
  • Français

Banana Splits: Policy Process, Particularistic Interests, Political Capture, and Money in Transatlantic Trade Politics

Published online by Cambridge University Press:  20 January 2017

Olivier Cadot  and
Douglas Webber
Olivier Cadot*
Affiliation:
HEC Lausanne, CERDI and CEPR, London
Douglas Webber*
Affiliation:
INSEAD
*
HEC Lausanne, BFSH 1, CH1015 Lausanne, Switzerland. Email: [email protected].
INSEAD, Asian Campus, 1 Ayer Rajah Avenue, Singapore 138676. Email: [email protected].
Get access Rights & Permissions [Opens in a new window]

Abstract

The most intractable and protracted transatlantic trade conflict of the last decade was over bananas, which grow neither on the European nor on the North American continent. Our explanation of the conflict emphasizes the determining role of the domestic politics of the EU and the United States. It was driven not only by the extreme divergence of preferences of Brussels' and Washington's domestic constituencies, rooted in the competitive position of competing banana industries, but also, and critically, by the institutional configuration of (agricultural) trade policymaking on either side of the Atlantic. The EU agricultural trade policy process is characterized by a division of labor that favors agricultural over wider trading interests, sectoral segmentation, and sector-specific issue-linkage. The U.S. trade policy process is characterized by the Congress's growing reassertion of its trade policy prerogatives, the growing institutionalization of firms' access to the trade policy bureaucracy, and the growing volume and role of corporate campaign donations. The combined effect of these different policy process traits has been to facilitate the capture of banana trade policy by highly organized, particularistic, and predominantly trading interests. Although neither the WTO nor the transatlantic trading relationship ultimately “slipped” over bananas, the conflict provides scant reason for optimism concerning the future of this relationship or indeed of the multilateral international trading system, at least in as far as the latter depends on good EU-U.S. relations.

Type
Research Article
Information
Business and Politics , Volume 4 , Issue 1 , April 2002 , pp. 5 - 39
Copyright
Copyright © V.K. Aggarwal 2002 and published under exclusive license to Cambridge University Press 

Access options

Get access to the full version of this content by using one of the access options below. (Log in options will check for institutional or personal access. Content may require purchase if you do not have access.)

References

Baldwin, Robert E., Magee, and Christopher S. 2000. Congressional Trade Votes: From NAFTA Approval to Fast-Track Defeat. Washington, DC: Institute for International Economics.Google Scholar
Bhagwati, Jagdish. 1965. “On the equivalence of tariffs and quotas.” In Trade, Growth and the Balance of Payments: Essays in Honour of Gottfried Haberler, edited by Baldwin, Robert E. et al. Chicago: Rand McNally.Google Scholar
Borrell, Brent. 1994. “EU Bananarama III.” Policy Research Working Paper 13/86. Washington: World Bank.Google Scholar
Borrell, Brent. 1999. “Bananas: straightening out bent ideas on trade as aid.” Paper presented at the conference on agriculture and a new trade agenda from a development perspective, October, Geneva.Google Scholar
Borrell, Brent and Cuthbertson, S. 1992. “EC Banana Policy 1992: Picking the Best Option.” Working Paper. Canberra: Centre for International Economics.Google Scholar
Borrell, Brent and Yang, M.C. 1990. “EC Bananarama 1992.” WPS 523. Washington, DC: The World Bank.Google Scholar
Borrell, Brent and Yang, M.C. 1992. “EC Bananarama 1992: The sequel, the EC Commission Proposal.” WPS 958. Washington, DC: The World Bank.CrossRefGoogle Scholar
Bütler, Monika and Hauser, Heinz. 2000. “The WTO Dispute Settlement System: A First Assessment from an Economic Perspective.” Journal of Law, Economics and Organization 16 (2): 503–523.CrossRefGoogle Scholar
Cadot, Olivier and Webber, Douglas. 1996. “Banana Split in Europe.” Fontainebleau: INSEAD (Teaching Case A).Google Scholar
Center for Responsive Politics. 2001. “Campaign Finance Reform.” Available from <http://www.opensecrets.org/news/campaignfinance/index.asp>. Accessed 5 August 2001..+Accessed+5+August+2001.>Google Scholar
Center for Responsive Politics. 1999a. Results: Individual Donors Search. Available from <http://www.crp.org/indivs/cgi-win/indivs.exe>. Accessed 12 March 1999..+Accessed+12+March+1999.>Google Scholar
Center for Responsive Politics. 1999b. Top 50 Soft Money Contributors. Available at <http://www.opensecrets.org/pubs/bigpicture2000/top_contrib/softmoney.ihtml>. Accessed 16 November 1999..+Accessed+16+November+1999.>Google Scholar
Common Cause. 2001. The Half Billion Dollar Shakedown. Washington, DC: Common Cause.Google Scholar
Common Cause. 2000. A Reporter's Guide to Money in Politics: Campaign 2000. Washington, DC: Common Cause.Google Scholar
Destler, I.M. 1995. American Trade Politics, 3rd edition. Washington, DC and New York: Institute for International Economics and Twentieth Century Fund.Google Scholar
Destler, I.M. and Balint, Peter J. 1999. The New Politics of American Trade: Trade, Labor, and the Environment. Washington, DC: Institute for International Economics.Google Scholar
Dole. 2001. Press releases: Reaction to United States Trade Representative's Actions over European Banana Regime, 12 April. Available from <http://www.dole.com/company/press>. Accessed 11 May 2001.. Accessed 11 May 2001.' href=https://scholar.google.com/scholar?q=Dole.+2001.+Press+releases:+Reaction+to+United+States+Trade+Representative's+Actions+over+European+Banana+Regime,+12+April.+Available+from+.+Accessed+11+May+2001.>Google Scholar
Everling, U. 1996. “Will Europe slip on bananas? The bananas judgment of the Court of Justice and national courts.” Common Market Law Review 33: 401–437.CrossRefGoogle Scholar
Garten, Jeffrey. 1997. “Business and Foreign Policy.” Foreign Affairs 76 (3): 67–79.Google Scholar
Gilpin, Robert. 2000. The Challenge of Global Capitalism: The World Economy in the 21st Century. Princeton, NJ: Princeton University Press.CrossRefGoogle Scholar
Gleason, Carolyn and Walther, Pamela D. 2000. “The WTO Dispute Settlement Implementation Procedures: A System in Need of Reform.” Law and Policy in International Business 31 (3): 709–736.Google Scholar
Gourevitch, Peter. 1996. “Squaring the circle: the domestic sources of international cooperation.” International Organization 50 (2): 349–373.Google Scholar
Grant, Wyn. 1993. Business and Politics in Britain, 2nd edition. Basingstoke and London: Macmillan.CrossRefGoogle Scholar
Hall, Peter. 1979. Governing the Economy: The Politics of State Intervention in Britain and France. Cambridge: Polity Press.Google Scholar
Hallam, David and Professor the Lord Peston. 1997. “The Political Economy of Europe's Banana Trade.” Occasional Paper No. 5. Reading: University of Reading Department of Agricultural and Food Economics.Google Scholar
Hanson, Brian. 1998. “What Happened to Fortress Europe? External Trade Policy Liberalization in the European Union.” International Organization 52 (1): 55–85.CrossRefGoogle Scholar
Hayes-Renshaw, Fiona and Wallace, Helen. 1997. The Council of Ministers. Basingstoke and London: Macmillan.CrossRefGoogle Scholar
Héritier, Adrienne. 1993. “Policy-Netzwerkanalyse als Untersuchungsinstrument im europäischen Kontext: Folgerungen aus einer empirischen Studie regulativer Politik.” In Policy-Analyse: Kritik und Neuorientierung, edited by Héritier, . Opladen: Westdeutscher Verlag.CrossRefGoogle Scholar
Ikenberry, G. John. 2000. “Don't Panic: How Secure Is Globalization's Future?” Foreign Affairs 79 (3): 145–151.CrossRefGoogle Scholar
Kindleberger, Charles. 1973. The World in Depression. Berkeley/Los Angeles, CA: University of California Press.Google Scholar
Kuilwijk, Kees Jan. 1996. “The EC banana saga: Some reflections on the rights of EC importers and the Community public interest.” In European Trade and Industry in the 21st Century: Future Directions in EC Law and Policy, edited by Kuilwijk, and Wright, Robert. Beuningen: Nexed.Google Scholar
Mann, James. 2000. About Face: A History of America's Curious Relationship with China, from Nixon to Clinton. New York: Vintage Books.Google Scholar
Mearsheimer, John J. 1990. “Back to the Future: Instability in Europe After the Cold War.” International Security 15 (1): 5–56.CrossRefGoogle Scholar
Meunier, Sophie. 2000. “What Single Voice? European Institutions and EU-U.S. Trade Negotiations.” International Organization 54 (1): 103–135.Google Scholar
Milner, Helen. 1990. “The Political Economy of U.S. Trade Policy: A Study of the Super 301 Provision.” In Aggressive Unilateralism: America's 301 Trade Policy and the World Trading System, edited by Bhagwhati, Jagdish and Patrick, Hugh T. New York: Harvester Wheatsheaf.Google Scholar
Müller-Armack, Alfred. 1971. Auf dem Weg nach Europa. Tübingen and Stuttgart: Rainer Wunderlich and C.E. Poeschel.Google Scholar
Neustadt, Richard E. 2001. “The Weakening White House.” British Journal of Political Science 31 (1): 1–11.Google Scholar
Nicoll, William. 1994. “Representing the States.” In Maastricht and Beyond: Building the European Union, edited by Duff, Andrew, Pinder, John and Pryce, Roy. London and New York: Routledge.Google Scholar
Nivola, Pietro S. 1990. “Trade Policy: Refereeing the Playing Field.” In A Question of Balance: The President, the Congress, and Foreign Policy, edited by Mann, Thomas E. Washington, DC: The Brookings Institution.Google Scholar
Noland, Marcus. 1999a. The New Protectionists: The Privatisation of U.S. Trade Policy. Studies in Trade and Development No. 3. London: Institute of Economic Affairs.Google Scholar
Noland, Marcus. 1999b. “Learning to Love the WTO.” Foreign Affairs 78 (5): 78–92.Google Scholar
Nugent, Neill. 1994. The Government and Politics of the European Union. Durham, NC: Duke University Press.CrossRefGoogle Scholar
Olson, Mancur. 1965. The Logic of Collective Action: Public Goods and the Theory of Groups. Cambridge, MA: University of Harvard Press.Google Scholar
Pedler, R.H. 1994. “The Fruit Companies and the Banana Trade Regime (BTR).” In Lobbying in the European Union, edited by Pedler, and Van Schendelen, M.C.P.M. Aldershot: Dartmouth.Google Scholar
Ruggie, John Gerard. 1994. “At Home Abroad, Abroad at Home: International Liberalisation and Domestic Stability in the New World Economy.” Millennium: Journal of International Studies 24 (3): 507–526.CrossRefGoogle Scholar
Shaffer, Gregory C. 2001. “The Blurring of the Intergovernmental: Public-Private Partnerships behind US and EC Trade Claims.” In Transatlantic Governance in the Global Economy, edited by Pollack, Mark A. and Shaffer, . Lanham: Rowman & Littlefield.Google Scholar
Soisson, Jean-Pierre. 1993. Politique en jachère. Paris: Albin Michel.Google Scholar
Spence, David. 1995. “Negotiations, coalitions and the resolution of interstate conflicts.” In The Council of the European Union, by Westlake, Martin. London: Cartermill.Google Scholar
Stevens, Christopher. 1996. “EU policy for the banana market: The external impact of internal policies.” In Policy-Making in the European Union, edited by Wallace, Helen and Wallace, William. Oxford: Oxford University Press.Google Scholar
Streeck, Wolfgang (with Schmitter, Philippe). 1992. “From National Corporatism to Transnational Pluralism: Organized Interests in the Single European Market.” In Social Institutions and Economic Performance: Studies of Industrial Relations in Advanced Capitalist Economies, by Streeck, . London: Sage.Google Scholar
Thagesen, Rikke and Matthews, Alan. 1997. “The EU's Common Banana Regime: An Initial Evaluation.” Journal of Common Market Studies 35 (4): 615–627.Google Scholar
Thelen, Kathleen and Steinmo, Sven. 1992. “Historical institutionalism in comparative politics.” In Structuring Politics: Historical institutionalism in comparative analysis, edited by Thelen, and Steinmo, . Cambridge: Cambridge University Press.CrossRefGoogle Scholar
Van de Kaastele, Adelien, 1998. “The banana chain: the macroeconomics of the banana trade.” Paper presented at the International Banana Conference, May, Brussels.Google Scholar
Van Schendelen, M.C.P.M. 1996. “‘The Council decides’: Does the Council decide?” Journal of Common Market Studies 34 (4): 531–548.CrossRefGoogle Scholar
Vogel, David. 1997. Barriers or Benefits? Regulation in Transatlantic Trade. Washington, DC: Brookings Institution Press.Google Scholar
Watkins, Michael, Edwards, Mickey and Thakrar, Usha. 2001. Winning the Influence Game: What Every Business Leader Should Know about Government. New York: John Wiley.Google Scholar
Wessels, Bernd-Artin. 1995. Das Bananendiktat. Frankfurt/Main and New York: Campus.Google Scholar
Westlake, Martin. 1995. The Council of the European Union. London: Cartermill.Google Scholar
Wilson, James Q. 1980. “The Politics of Regulation.” In The Politics of Regulation, edited by Wilson, . New York: Basic Books.Google Scholar
WTO. 1999. “European Communities: Regime for the importation, sale and distribution of bananas—recourse to article 21.5 by Ecuador (report of the panel).”Google Scholar
WTO. 2001. Dispute Settlement Body. Annual Report (2001). Addendum: Overview of the State of Play of WTO Disputes (http://www.wto.org).Google Scholar