The Temporary Movement of Workers to Provide Services (GATS Mode 4)

Abstract

Abstract This chapter considers the case and the means for liberalizing the temporary flow of labor between countries for the purpose of providing services: mode 4 of the GATS. Despite being until now a mere bit-player in the GATS, mode 4 is at last starting to command some attention from negotiators and policy makers. The attention is long overdue, especially since serious efforts to liberalize the temporary movement of natural persons (TM) from developing to developed member countries could generate very large mutual benefits. The chapter comprises seven parts: (1) the extent and nature of TM and the barriers to it, and the ways in which we might think of and model the liberalization of mode 4; (2) estimates of the benefits of mode 4 liberalization treating it as akin to migration; (3) the simple gains from TM of persons as part of mode 4 liberalization based on computable models estimates; (4) ways in which the polar forms of thinking about TM may be relaxed in future empirical exercises to try to refine the estimates of the effects of liberalization; (5) practical issues that may be negotiated in the GATS to make TM a reality; (6) the benefits GATS mode 4 may bring to countries wanting to liberalize TM; and (7) arguments for and technicalities of compensating domestic workers who are disadvantaged by inflows of workers from abroad. The addenda to the chapter contain discussion of US experience with the temporary movement of service providers and mode 4 issues in the Latin American context.

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