The Generalized System of Preferences and Ngo Activism

Can preferential market access help to enforce Labor Laws in beneficiary countries? The US Generalized System of Preferences (GSP) is accorded conditional on compliance with labor rights and leaves room for petitioning revising the scheme upon request by interest groups. Using data from Indonesian Manufacturing firms, we show that GSP renegotiation combined activism workers' groups helped increase firm-level average wages up minimum-wage level, not only inside but also outside export sector. leverage allowed NGOs act more effectively putting violation national under international spotlight.