International Institutions and Issue Linkage February 2004 economic welfare by 56 billion dollars annually,which Iida 1993;Odell 2000).While two-level game analy- would be in addition to the direct budget savings.In sis has improved our understanding of how domestic Japan and Europe,on the other hand,where many politics affect outcomes,many studies treat the inter- producers are not competitive in world markets,liber- national level as an undifferentiated bargaining arena. alization threatens the welfare of rural society.Politi- Milner (1997.70),for example,writes,"The interna- cization and high economic stakes make for an ex- tional game adopted does not have a well-defined in- plosive combination that threatens the stability of the stitutional structure;politics on that level are assumed trade system.Japan and Europe both have risked trade to be anarchic,and international negotiations are gen- wars with the United States over food fights (Davis erally conducted without a constitutionally mandated 2003a).Agricultural issues have nearly blocked the sequence of moves."This disregards the dense network conclusion of successive trade rounds and generated of international institutions that shapes the conduct of half of all GATT trade disputes over the period 1960 any given negotiation. 89(Hudec 1993,327).Agriculture continues to present The institutions of the negotiation structure-the a central challenge for the successful conclusion of the agenda,rules,and procedures that guide the interac- new WTO trade round launched in November 2001 tion between states in a policy dispute-influence the in Doha,Qatar.The large share of agriculture in the negotiation outcome because they establish which al- economies of developing countries makes further lib- ternatives are considered and how they are decided. eralization of agricultural trade essential if the Doha As with other institutional constraints,such as interna- Round is to fulfill its development agenda tional treaties or legislative committee rules,the insti- Although agriculture remains protected in compari- tutions of the negotiation structure favor certain actors son to other sectors,liberalization has occurred.Over and policy options(Keohane 1984;North 1990;Shepsle the past 30 years,even Japan and Europe have agreed and Weingast 1995).In trade negotiations,institutions to reduce many trade barriers,and the share of im change both the mobilization by interest groups and ports in total consumption has increased.According the policy track for decision making. to the OECD measures of agricultural protection,the First,the negotiation agenda sets the negotiation total support for agriculture as a share of GDP has stakes and policy scope.Publicly announcing the issues declined from 2.4%for Japan and 2.6%for the EU that are up for discussion informs domestic actors of in 1986 to 1.4%for both in 2001 (OECD 2002b,187, the potential gains and losses.Interest groups are in- 196).In specific policy changes,market price support volved in the process of creating the agenda as they has been reduced,Japan dismantled its system of quota lobby for the inclusion or exclusion of their own issue. restrictions one by one,and the EU replaced its trade- Few,however,lobby beyond their own issue.Govern- distorting variable levy with a more transparent tariff ments must aggregate diverse demands from domestic system.Thus,negotiations on agricultural trade policy interests while also trying to accommodate other gov- have included both dramatic negotiation failures and ernments to produce a single agenda.The final agenda negotiations that brought substantial liberalization. reveals the full array of issues that then become im- portant for all groups with a stake in any one issue. Likewise,the issues on the agenda determine the scope FRAMEWORK FOR NEGOTIATION of bureaucratic and political committee jurisdictions ANALYSIS that will address the negotiation.This matters given the importance of who initiates policy proposals and who In negotiations that bring liberalization,what has al- makes the last decision(Garrett and Tsebelis 1996). lowed governments to overcome domestic interests Second,the negotiation procedures guide the se- that will be harmed?The literature on trade politics quence of decisions.If there are multiple issues on the highlights the importance of distributional stakes for agenda,for example,the negotiation could culminate in interest groups(Grossman and Helpman 1995;Hiscox a single decision on all the issues or separate decisions 2002:Milner 1997).I emphasize how the institutional on each one.As shown by the literature on institutions context of the international negotiation changes the in American politics,outcomes often differ according aggregation of these interests.Negotiations that link to which alternatives are presented to the legislature issues across multiple sectors have a different impact on (Shepsle and Weingast 1995). domestic politics than single sector negotiations.An in- Third,the nature of the rules determines the form stitutionalized linkage of negotiations on multiple sec- of commitments that are reached in the negotiation tors broadens interest group lobbying and bureaucratic Specifically,the rule framework creates the expecta- jurisdiction to counter the domestic bias that favors tion for whether a negotiated agreement will represent protection. a binding legal commitment with a monitoring mecha- Putnam (1988)introduced the analogy of two-level nism.This raises the costs of later defection from agree- games to characterize the observation that a leader ne. ments.Greater legalization adds the value of the rule gotiates simultaneously over domestic goals and the system and future cooperation as new incentives.Taken international bargain.Since then,a growing literature altogether,the institutions of the negotiation structure has attempted to explain how interest groups,domes- have a direct impact on the distributional consequences tic political institutions,or the bargaining strategies of of the negotiation. negotiators determine the range of possible negotia- There are multiple venues for trade negotiations, tion agreements(Evans,Jacobson,and Putnam 1993; and the institutional context influences the potential 154 Reproduced with permission of the copyright owner.Further reproduction prohibited without permission.Reproduced with permission of the copyright owner. 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