Preferential Trade Agreements and Leaders' Business Experience.

This article investigates the influence of executive leaders' prior business managerial experience on their countries' engagement in preferential trade agreements (PTAs) and the depth of such agreements. Using a newly constructed dataset covering 185 countries from 1948 to 2009, the study finds that leaders with business backgrounds are significantly more likely to initiate and sign deeper PTAs compared to nonbusiness leaders. The analysis employs instrumental variable techniques and leverages exogenous leadership transitions due to sudden deaths or illnesses to address endogeneity concerns. An illustrative case study of Canadian Prime Minister Brian Mulroney's role in the 1988 US–Canada Free Trade Agreement further supports the argument that business experience shapes trade policy preferences through socialization and material interest channels. The findings highlight the importance of individual leaders' professional backgrounds in shaping international economic cooperation beyond structural and institutional factors.