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The process of ratifying CAFTA in Costa Rica required traversing a contentious political landscape involving intense legislative battles, massive public demonstrations, and finally a national referendum in October 2007. By employing the mechanism of direct democracy to ratify a free trade agreement, Costa Rica made history. But how did this experiment with direct participation affect Costa Rica's democracy? This article evaluates what the referendum achieved in terms of promoting citizen engagement, equipping voters to make informed choices, resolving the CAFTA conflict in a way viewed as legitimate, and shaping citizens' relationships to representative institutions. While the referendum had positive effects, it had several negative consequences for representative democracy, which raises questions about the limits of democratic control over economic policy in the era of globalization. [ABSTRACT FROM AUTHOR]