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Peculiarities of Retaliation in WTO Dispute Settlement

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Author Info
Anderson, Kym

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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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Paper provided by C.E.P.R. Discussion Papers in its series CEPR Discussion Papers with number 3578.

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Date of creation: Oct 2002
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Handle: RePEc:cpr:ceprdp:3578

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Related research
Keywords: compensation; dispute settlement; retaliation; WTO;

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Find related papers by JEL classification:
F13 - International Economics - - Trade - - - Trade Policy; International Trade Organizations
K33 - Law and Economics - - Other Substantive Areas of Law - - - International Law
K42 - Law and Economics - - Legal Procedure, the Legal System, and Illegal Behavior - - - Illegal Behavior and the Enforcement of Law
Q17 - Agricultural and Natural Resource Economics; Environmental and Ecological Economics - - Agriculture - - - Agriculture in International Trade

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References listed on IDEAS
Please report citation or reference errors to , or , if you are the registered author of the cited work, log in to your RePEc Author Service profile, click on "citations" and make appropriate adjustments.:
  1. Grossman, Gene M & Helpman, Elhanan, 1994. "Protection for Sale," American Economic Review, American Economic Association, vol. 84(4), pages 833-50, September. [Downloadable!] (restricted)
    Other versions:
  2. Grossman, Gene M & Helpman, Elhanan, 1995. "Trade Wars and Trade Talks," Journal of Political Economy, University of Chicago Press, vol. 103(4), pages 675-708, August. [Downloadable!] (restricted)
    Other versions:
  3. 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.
  4. Robert C. Feenstra, . "Integration Of Trade And Disintegration Of Production In The Global Economy," Department of Economics 98-06, California Davis - Department of Economics. [Downloadable!]
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Cited by:
(explanations, Please report citation or reference errors to , or , if you are the registered author of the cited work, log in to your RePEc Author Service profile, click on "citations" and make appropriate adjustments.)

  1. Pao-Li Chang, 2004. "The Politics of WTO Enforcement Mechanism," Working Papers 04-2004, Singapore Management University, School of Economics. [Downloadable!]
    Other versions:
  2. Joseph Pelzman & Amir Shoham, 2007. "WTO Enforcement Issues," Global Economy Journal, Berkeley Electronic Press, vol. 7(1). [Downloadable!]
  3. Carsten Herrmann-Pillath, 2006. "Reciprocity and the hidden constitution of world trade," Constitutional Political Economy, Springer, vol. 17(3), pages 133-163, September. [Downloadable!] (restricted)
  4. Thomas A. Zimmermann, 2005. "WTO Dispute Settlement at Ten: Evolution, Experiences, and Evaluation," International Trade 0504003, EconWPA. [Downloadable!]
  5. Fritz Breuss, 2004. "WTO Dispute Settlement: An Economic Analysis of four EU-US Mini Trade Wars," WIFO Working Papers 231, WIFO. [Downloadable!]
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