85th International Atlantic Economic Conference

March 14 - 17, 2018 | London, United Kingdom

Social expectations concerning free trade agreements: Perception versus reality

Friday, 16 March 2018: 3:00 PM
Bogna Gawronska Nowak, Associate Professor , Economics and Management, Lazarski University, Warsaw, Poland
Krzystof Beck, Ph.D. , Lazarski University, Warsaw, Poland
Paul Valdivieso, Ph.D. , Institute for Socio-Economic Enquiry, Warsaw, Poland
Recently the Free Trade Agreements (FTA) have been drawing public attention enormously being affected by new waves of political populism, alter-globalisation, and some tendencies to redefine patterns of the world economic ties. From the European perspective especially the Comprehensive Economic and Trade Agreement (CETA), and the Transatlantic Trade and Investment Partnership (TTIP) have brought “on board” serious public concerns about environmental protection, food quality, job security, and citizen rights. Donald Trump openly criticizes the North American Free Trade Agreement (NAFTA) calling it “the single worst trade deal ever approved in this (US) country”.

The main purpose of this paper is to confront the social perception concerning the FTA with the so-called “expert knowledge”. Defining a mismatch between the social perception and the expert knowledge may contribute to better understanding of the controversies on the FTA, as well as to properly defining possible sources of social conflicts and vulnerabilities of the policy implementation level. Having examined relevant studies on the social expectations in Europe concerning FTA (for example Bertelsmann Foundation, 2016; Eurobarometer 2015, 2014) we have observed that the analysis should be developed and continued in more detail, including country-specific and time-variant dimensions. The European perception should be contrasted with the American one, however devoting special attention to opinions of the Latin Americans that constitute a significant population in the U.S. and are major contributors and beneficiaries of the NAFTA.

We test the following hypotheses:

There is a mismatch between social perception and expert knowledge on the FTA.

The mismatch is mainly based on emotional rather than a rational basis (on social sentiments).

We use content analysis as well as Bayesian Model Averaging, which allows estimation of how far from objective judgment an opinion of an average user of the internet is in Europe, U.S., and Latin America.