Revisiting Embedded Liberalism: Does the Theoretical Possibility Meet Empirical Validity? Analyzing Labor Laws and Preferential Trade Agreements.

Extant scholarship on embedded liberalism (EL) emphasizes whether governments keep their promises to protect the risk-bearers of economic liberalization but overlooks its liberalization effect. In particular, scholars rarely explore how EL solves the time-inconsistency problem plaguing economic libe...

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Publicado en:International Studies Quarterly Vol. 69; no. 2; pp. 1 - 17
Autor principal: Wang, Zhiyuan
Formato: Artículo
Publicado: Oxford University Press / USA Jun2025
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Acceso en línea:Ver este registro en EBSCOhost
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      pub: Oxford University Press / USA
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        atl: Revisiting Embedded Liberalism: Does the Theoretical Possibility Meet Empirical Validity? Analyzing Labor Laws and Preferential Trade Agreements.
      aug:
        au: Wang, Zhiyuan
        affil: University of Florida, United States
      su:
        Labor laws
        Liberalism
        Political systems
        Social security
        Commercial treaties
        Free trade
        Inconsistency (Logic)
      sug:
        subj:
          Labor laws
          Liberalism
          Political systems
          Social security
          Regulation, Licensing, and Inspection of Miscellaneous Commercial Sectors
          Commercial treaties
          Free trade
          Inconsistency (Logic)
      ab: Extant scholarship on embedded liberalism (EL) emphasizes whether governments keep their promises to protect the risk-bearers of economic liberalization but overlooks its liberalization effect. In particular, scholars rarely explore how EL solves the time-inconsistency problem plaguing economic liberalization, i.e. governments may ex post renege on their policy promises made prior to the liberalization. To fill this void, in this study, I look into how social insurance shapes efforts to liberalize trade. I argue that institutionalized social consensus such as labor market institutions (LMIs) mitigates the time-inconsistency problem and encourages trade liberalization. I test this argument by examining how LMIs affect the making and design of preferential trade agreements (PTAs). Leveraging comprehensive datasets on labor laws and PTAs, an endogenous count model analysis finds that strong labor laws are positively associated with the growth of PTAs. Furthermore, robust labor laws tend to produce deeper PTAs with rigorous enforcement mechanisms. These effects dominate in democracies and are not a function of policy substitution. The empirical findings remain considerably consistent across alternative econometric estimators, variable measures, and model specifications, except those concerning enforcement-related hypotheses. Overall, this study demonstrates that pre-committed social protection facilitates economic liberalization, corroborating the core thesis of EL.
      pubtype: Academic Journal
      doctype: Article
      src: R
    language: English
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