Global Governance and the Problem of the Second Best: The Example of Reforming the World Trade Organization

Abstract

This article–a unique collaboration between political philosophy and empirical analysis–applies the problem of the second best to the subject of global governance reform. The problem of the second best raises a concern about an “approximation trap” where steps intended to move closer to an ideal instead generate outcomes that are worse than the unreformed system. The solution, we argue, is “second-best theorizing,” identifying a package of objectives worth protecting so long as the first-best ideal remains elusive. Our second-best theorizing involves ideal elements that one can approximate, deviant elements that one must defend so long as the ideal is unattainable, a substantive floor so that reforms do not make things worse, and a meta-requirement that wholesale institutional change take the form of a “constructive vote of no-confidence.” We then apply these criteria, suggesting reforms of the World Trade Organization (WTO). Our example of the Kantian ideal, our second-best criteria, and their application to the WTO are real examples. Yet our larger objective is to demonstrate the problem of the second best as it applies to global governance, thus their development is mainly illustrative. Readers need not share either the first or second-best objectives to agree with the larger point. So long as efforts to approximate an ideal (e.g. economic growth, Pareto welfare improvements, etc.) can fall prey to the approximation trap, our endorsement of the superiority of second-best theorizing applies. In fact, one of our goals is to prompt second-best theorizing around a range of proposals to reform the global order, to make global capitalism more normatively defensible and politically sustainable.