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Pecularities of Retaliation in WTO Dispute Settlement

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Author Info

  • Kym Anderson

    ()
    (School of Economics, University of Adelaide, Australia)

Abstract

The dispute resolution procedures of the World Trade Organization allow sanctions to be imposed when a country is unwilling to bring a WTO-inconsistent trade measure into conformity. Apart from the fact that the procedure for triggering the retaliation process has ambiguities that need to be removed, the retaliation itself has some undesirable economic features. This paper looks at why compensation is not preferred to retaliation and then examines five economic features of the temporary trade retaliation that WTO may permit under certain conditions. Both efficiency and equity concerns are raised. The paper concludes with some suggestions for reforming this part of WTO dispute resolution during the review of the Dispute Settlement Understanding that is due to be completed by May 2003.

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File URL: http://www.adelaide.edu.au/cies/papers/0207.pdf
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Bibliographic Info

Paper provided by University of Adelaide, Centre for International Economic Studies in its series Centre for International Economic Studies Working Papers with number 2002-07.

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Length: 28 pages
Date of creation: Mar 2002
Date of revision:
Handle: RePEc:adl:cieswp:2002-07

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Keywords: WTO; Dispute settlement; Compensation; Retaliation;

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References

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  1. Grossman, G.M. & Helpman, E., 1993. "Trade Wars and Trade Talks," Papers 1-93, Tel Aviv.
  2. Gene M. Grossman & Elhanan Helpman, 1992. "Protection For Sale," NBER Working Papers 4149, National Bureau of Economic Research, Inc.
  3. Robert Feenstra, 2003. "Integration Of Trade And Disintegration Of Production In The Global Economy," Working Papers 986, University of California, Davis, Department of Economics.
  4. Salas, Mauricio & Jackson, John H, 2000. "Procedural Overview of the WTO EC-Banana Dispute," Journal of International Economic Law, Oxford University Press, vol. 3(1), pages 145-66, March.
  5. Gary Clyde Hufbauer & Jeffrey J. Schott & Kimberly Ann Elliott, 1990. "Economic Sanctions Reconsidered: 2nd Edition," Peterson Institute Press: All Books, Peterson Institute for International Economics, number 82.
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Citations

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Cited by:
  1. Pao-Li Chang, 2004. "The Politics of WTO Enforcement Mechanisms," Econometric Society 2004 Australasian Meetings 117, Econometric Society.
  2. Ludmila Štěrbová & Kamila Trojanová, 2013. "Patent Protection of European Pharmaceutical Innovations in India," Současná Evropa, University of Economics, Prague, vol. 2013(3), pages 35-54.
  3. Chau, Nancy H. & Färe, Rolf, 2011. "Shadow pricing market access: A trade benefit function approach," Journal of Economic Theory, Elsevier, vol. 146(4), pages 1631-1663, July.
  4. Thomas A. Zimmermann, 2005. "WTO Dispute Settlement at Ten: Evolution, Experiences, and Evaluation," International Trade 0504003, EconWPA.
  5. Anderson, Kym, 2004. "Setting the Trade Policy Agenda: What Roles for Economists?," Working Papers 14574, International Agricultural Trade Research Consortium.
  6. Fritz Breuss, 2004. "WTO Dispute Settlement: An Economic Analysis of Four EU–US Mini Trade Wars—A Survey," Journal of Industry, Competition and Trade, Springer, vol. 4(4), pages 275-315, December.
  7. Cardwell, Ryan & Kerr, William A., 2013. "Reforming WTO Rules on Export Restrictions - Is There Any Point?," Commissioned Papers 158894, Canadian Agricultural Trade Policy Research Network.
  8. Fritz Breuss, 2004. "WTO Dispute Settlement: An Economic Analysis of four EU-US Mini Trade Wars," WIFO Working Papers 231, WIFO.
  9. Carsten Herrmann-Pillath, 2006. "Reciprocity and the hidden constitution of world trade," Constitutional Political Economy, Springer, vol. 17(3), pages 133-163, September.

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