International trade and labour: a quest for moral legitimacy

Abstract

PurposeThe purpose of this paper is to critically review the arguments for and against a social clause as an ethical benchmark for international trade.Design/methodology/approachThe paper takes a social economic approach in analysing the case for and against a social clause in international trade. It considers an economic, jurisprudential, social and human rights case for a social clause.FindingsThe consideration of a social clause purely in economic terms, removed from its social context fundamentally flaws the arguments on both sides of the debate. The conclusion of south‐south labour agreements, north‐south bilateral free‐trade agreements and regional integration schemes incorporating labour standards has a positive impact on diffusing tension and helping in consensus building around the issue. Labour standards are human rights and to claim comparative advantage in human rights in trade is unethical. There is a need to keep the debate alive especially within the World Trade Organization.Practical implicationsThe paper provides an insight into the utility of a social clause in the trade and development agenda for both developed and developing countries.Originality/valueGiven the strength of emotions surrounding the issue, the proposed approach will assist in detoxing the debate and in providing an avenue for vertical and horizontal consensus building on the issue.