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Article: Most-Favored-Nation Principle
- Article from:
- Encyclopedia of American Foreign Policy
- Author:
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Most-Favored-Nation Principle
Justus D. Doenecke and
Michael R. Adamson
From its inception, the United States has incorporated the most-favored-nation (MFN) principle into its trade policy. Until 1923 it adhered to its conditional form and thereafter to unconditional MFN treatment. Only with the passage of the 1934 Reciprocal Trade Agreements Act (RTAA), however, did Congress allow U.S. trade negotiators to use unconditional MFN treatment as an instrument of trade liberalization. That is, the MFN principle does not equate with free or freer trading environments. From 1778 until 1934, U.S. trade policy was explicitly protectionist. In this environment, the adoption by the ...