Disciplining domestic regulation: the World Trade Organization and the market for professional servi

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Disciplining domestic regulation: the World Trade Organization and the market for professional services

Patricia J. Arnold


Abstract

This paper presents an institutional analysis of the processes underlying the globalization of professional service and
labor markets. Focusing on the accountancy sector, the research documents the ongoing efforts by non-market insti-
tutions, including transnational accounting firms and industry lobbies in Europe and the US, to create a global market
for accounting and auditing services under the auspices of the World Trade Organization (WTO). The research shows
how international trade agreements, specifically the General Agreement on Trade in Services (GATS)
and the Disciplines on Domestic Regulation in the Accountancy Sector, are being used to eliminate domestic regulations that industry views as barriers to trade and investment, such as diverse national and sub-national licensing and qualification requirements, regulations limiting scope of practice and forms of business organization, and non-harmonized technical standards. The
paper discusses the implications of theses trends for the future of domestic regulation and democratic forms of economic governance.

Introduction

Citizens and workers who are confronted with
the negative social repercussions of globalization,
such as job flight to low wage markets, global
environmental destruction, and unstable interna-
tional financial markets often feel powerless in the
face of change. This sense of powerlessness is
heightened by a contemporary mythology that
portrays globalization as natural and inevitable––
an impersonal and immutable force, akin to the
weather, that is beyond human intervention and
control; a force that workers and companies, alike

http://citeseerx.ist.psu.edu/viewdoc/download?doi=10.1.1.471.9900&rep=rep1&type=pdf