The trans-Atlantic economies of the US, Canada, and a number of European countries were not only a driving force behind the creation of the GATT, but they provide perhaps the most familiar story line for how the GATT facilitated gradual, multilateral trade liberalization and allowed countries to sustain an extensive period of low most-favored-nation (MFN) tari¤s. These countries used the GATT forum to reduce MFN tari¤s reciprocally through periodic negotiating rounds (WTO, 2007), and they then locked in those low tari¤s through legally binding commitments. Table 1 illustrates the multilateral trade liberalization process of negotiations (percentage tari¤ cuts) covering 1947-1994, and Table 2 documents the resulting average applied ad valorem tari¤ rates for a number of these countries in 1952 and again in 2005 after eight rounds of GATT negotiations.<sup>4</sup> The trans-Atlantic GATT experience is not, however, how countries have universally liberalized their MFN tari¤s or even entered into the GATT/WTO system. There are two prominent classes of exceptions that are best illustrated by the GATT/WTO experience of other member countries.

First, some countries did not enter the system at its inception; indeed, many “latecomers”did not seek or were not admitted entrance into the agreement until well after the initial set of GATT Contracting Parties had already substantially negotiated MFN tari¤ liberalization. As such, the GATT/WTO has had the ‡exibility to accommodate accessions by major economies, including West Germany in 1951, Japan in 1955, China in 2001, and Russia in 2012.<sup>5</sup> Second, many developing countries chose not to participate in the reciprocal tari¤ liberalization negotiations that took place under successive GATT rounds. Instead, countries including GATT founders India and Brazil requested and utilized “special and di¤erential treatment” exemptions from reciprocity in order to pursue import substitution policies. While such countries may currently apply relatively low (in historical terms) MFN tari¤s, their liberalization episodes frequently were not undertaken reciprocally, but instead unilaterally (e.g., India) or in concert with a period of preferential liberalization (e.g., Brazil). These and other countries also did not follow the transAtlantic approach of gradually lowering their MFN tari¤s over decades; instead, their period of low and sustained multilateral tari¤s began suddenly and not until the 1990s. And unlike the US and the EU, the relatively low MFN tari¤ rates that countries like Brazil and India apply have not been legally bound under the WTO at similarly low levels.

Finally, the WTO’s 161 members notwithstanding, there are at least three dozen countries that are not yet members. While most are developing countries and some liberalized their trade regimes

> with a single trade policy and tari¤, and the European Commission “speaks”on behalf of the EU member states in most WTO matters. Nevertheless, most other customs unions are not represented in the WTO in this manner, with individual countries retaining WTO membership rights and obligations.

> 4 By 1952, average import tari¤s expressed in ad valorem terms had already fallen substantially from peak levels in the 1930s and 1940s due to a combination of in‡ation, as many were imposed as speci...c duties, and the negotiated liberalization of the ...rst three GATT rounds. Irwin (1995, Table 5.2) reports average tari¤ rates in 1931 (after the US imposition of its Smoot-Hawley tari¤) for France, Germany, and Italy of 38, 40, and 48 percent, respectively. Irwin (2011, 2012) describes the political-economy forces behind the import protection that increased sharply during the Great Depression, and Irwin, Mavroidis, and Sykes (2008) describe the negotiations that ultimately led to establishment of the GATT in the late 1940s. WTO (2007) also provides an extensive analysis tracking the multilateral trade liberalization that took place over the 60 year period following the GATT 1947 inception.

> 5 China was an original Contracting Party to the GATT but withdrew in 1950. The other two original Contracting Parties to subsequently withdraw from the GATT were Lebanon and Syria.

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