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Ellen L. Frost*
Like a big bang, the explosion of information technology, both symbolized and realized by the Internet, has vastly multiplied opportunities for international commerce. Thanks to a digitally linked global economy, information zips across national frontiers without stopping at customs. A revolution is upon us, says IBM to its website readers; the private sector is reinventing itself to deal with the technology, but the public sector is just beginning to face the issues it raises.1
One of those issues is the future of trade policy Has the explosion of information technology changed the fundamental character of trade policy as it has been practiced to date? If not, what impact does or should it have? In other words, what is new?
This article will make the case that information technology does not alter the nature of U.S. trade policy, but it greatly expands its scope and partially transforms the role of trade negotiators. With respect to the telecommunications industry-i.e., the highway builders or carriers of information-negotiators face a largely familiar set of topics. But fulfilling the potential of electronic commerce, the for-profit traffic on the highway, opens up an unfamiliar universe of regulatory issues.
The resolution of these issues will need to be coordinated with the evolution of new multilateral rules. Increasingly, both policymakers and negotiators will find themselves not only holding talks with foreign governments, but also mediating between a variety of regulatory authorities and interest groups in their own country. But first, analyzing the implications of the new information technology for U.S. trade policymakers and negotiators requires a clear understanding of the ways that globalization and technology have shaped trade-and hence the U.S. trade policy agenda-thus far.
GLOBALIZATION
At the root of the globalization process are the twin technological revolutions in information and transportation. These revolutions enable companies to engage in flexible manufacturing and customized production to supply local markets around the world. A product meant for one set of consumers can easily be adapted for another. Mass production in a single location is disappearing. Few, if any, globally traded manufactured goods are produced in a single country, loaded into a crate and shipped intact to foreign customers. Instead, companies are now in a position to disperse different phases of the...