Layna Mosley, at UNC, argues “yes”:http://www.nytimes.com/2011/10/28/opinion/free-trade-by-itself-can-lift-labor-standards-abroad.html?_r=2&ref=opinion in today’s _New York Times._
bq. Research I conducted over the last several years with the political scientists Brian Greenhill and Aseem Prakash suggests that trade with developed nations helps developing countries expand labor rights themselves. Why? International trade gives producers incentives to meet the standards of their export markets. When developing nations export more to countries with better labor standards, their labor rights laws and practices tend to improve. Our findings, which are based on newly collected measures of labor rights around the world, demonstrate a “California effect” on workers’ rights, in which exporting nations are influenced by the labor rights conditions that prevail in their main trading partners. … Our research demonstrates that when a developing country with low labor standards trades with higher-standards countries like the United States and those in Europe, it comes under influences from the market itself that improve its labor standards. And this has a greater impact on developing nations than including labor conditions in trade agreements.
Greenhill, Mosley and Prakash’s 2009 APSR article on this topic can be found “here”:http://faculty.washington.edu/aseem/apsr.pdf.