North American Free Trade Agreement as a two-level game and implications for the free trade area of the Americas

The purpose of this paper is to break through the complexity of the NAFTA negotiations in order to reveal some of the contentious issues from three stages of the NAFTA bargaining process: the fast track agreement, the negotiations under President Bush, Sr., and the side payments under President Clinton. Putnam's two-level game theory will help describe how the interests of business, environmental groups, and labor unions influenced the outcome of the NAFTA through their respective win-sets, domestic and international power relations, and side agreements. Extrapolating from Putnam's model and the success in NAFTA bargaining, we can predict that the ongoing Free Trade Area of the Americas (FTAA) negotiations are more likely to succeed if international representatives strategize to create favorable conditions for domestic ratification through understanding the domestic constituencies and win-sets of the players.