Cross-border labor mobility: A critical assessment of WTO's GATS Mode 4 vis-à-vis regional trade agreements

Abstract

Purpose

The purpose of the paper is to examine convergence of economic interests – both empirically and theoretically – among labor-abundant (labor-sending) and labor scarce (labor receiving) countries, in the context of Mode 4 of the General Agreement on Trade in Services (GATS) of the WTO. The paper also explores regional trade associations as an interim alternative forum for promoting temporary cross-border labor mobility in the backdrop of failure of multilateral trade negotiations under the Doha Round.

Design/methodology/approach

The research methodology of the paper involves literature review, an analysis of databases and theoretical findings, and a critical examination of pertinent empirical and secondary information on the subject matter.

Findings

The findings reveal that although a convergence of economic interests seem to exist between the labor-sending and receiving countries for promoting cross-border labor mobility, this sector faces formidable trade and non-trade barriers across the world, especially in the developed countries. As multilateral trade negotiations under the Doha Round have failed to make any progress toward liberalization of this sector, regional trade associations, especially those pursued by the USA, Canada and Australia, seem to provide a credible alternative vehicle, as an interim measure, for further liberalization of this sector. These RTAs can serve as examples for other RTAs to promote regional mobility of labor.

Research limitations/implications

Cross-border temporary labor mobility, as envisaged by GATs of the WTO, is a burgeoning field. Although some serious works are available, especially sponsored by the World Bank and some leading universities, there is a considerable dearth in this field, especially in respect to contribution from individual scholars and researchers. This paper fills the void to some extent by ascertaining factors and forces that help or hinder cross-border mobility, by pointing out limitations of multilateral trade negotiations under the WTO, and by exploring the regional trade associations as an interim measure for promoting cross-border labor mobility.

Practical implications

This paper points out factors and forces that help or hinder cross-border mobility, ascertains crucial limitations of multilateral trade negotiations under the WTO, and explores the RTAs as an interim measure for promoting cross-border labor mobility – all these would have practical policy implications.

Originality/value

The originality of the paper lies with its critical and careful review of existing literature and available databases, with the determination of factors and forces that help or hinder cross-border mobility in the contemporary world, in pointing out the limitations of multilateral trade negotiations under the WTO, and in exploring the RTAs as an interim measure for promoting cross-border labor mobility.

Citation

Dowlah, C. (2014), "Cross-border labor mobility: A critical assessment of WTO's GATS Mode 4 vis-à-vis regional trade agreements", Journal of International Trade Law and Policy, Vol. 13 No. 1, pp. 2-18. https://doi.org/10.1108/JITLP-12-2012-0020