Regional market building as a social process: an analysis of cognitive strategies in NAFTA, the European Union and Mercosur

Regional market building is a social process. Market officials pursue integration objectives in the midst of unique institutional, cultural and economic contexts. Influenced by those contexts, they design markets with similar objectives but remarkably different architectures. This article offers a comparative analysis of the use of law for cognitive standardization in three regions: NAFTA, the European Union and Mercosur. In NAFTA, officials have adopted a minimalist approach, relying on external organizations for standard setting and case-by-case resolutions in case of conflict. By contrast, in the European Union and Mercosur, officials have developed extensive secondary legal systems rich with ontological and normative notions about the world. Those cognitive notions vary significantly, however, across the two markets in terms of targets and content. A historical institutionalist framework is developed to account for the observed differences across the three regions. Two variables are posited as being especially influential: the pre-existing legal traditions of the member states and the powerful interest groups that have flourished in those traditions. The empirical analysis centres on laws and cognitive notions in three areas: economics, the environment and public health. The findings improve our understanding of regional integration efforts and have implications for the literature on globalization and standards.