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Developing Countries and Enforcement of Trade Agreements: Why Dispute Settlement Is Not Enough

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  • Bown, Chad P.
  • Hoekman, Bernard

Abstract

Poor countries are rarely challenged in formal WTO trade disputes for failing to live up to commitments, reducing the benefits of their participation in international trade agreements. This paper examines the political-economic causes of the failure to challenge poor countries and discusses the static and dynamic costs and externality implications of this failure. Given the weak incentives to enforce WTO rules and disciplines against small and poor members, bolstering the transparency function of the WTO is important to make trade agreements more relevant to trade constituencies in developing countries. While our focus is on the WTO system, our arguments also apply to reciprocal North-South trade agreements.

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Paper provided by C.E.P.R. Discussion Papers in its series CEPR Discussion Papers with number 6459.

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Date of creation: Sep 2007
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Handle: RePEc:cpr:ceprdp:6459

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Keywords: developing countries; dispute settlement; enforcement; trade agreements; WTO;

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References

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  1. Horn, Henrik & Maggi, Giovanni & Staiger, Robert, 2007. "Trade Agreements as Endogenously Incomplete Contracts," CEPR Discussion Papers 6037, C.E.P.R. Discussion Papers.
  2. Petros C. Mavroidis & Kyle Bagwell & Robert W. Staiger, 2004. "The case for tradable remedies in WTO dispute settlement," Discussion Papers 0405-05, Columbia University, Department of Economics.
  3. James P. Durling, 2003. "Deference, But Only When Due: WTO Review of Anti-Dumping Measures," Journal of International Economic Law, Oxford University Press, vol. 6(1), pages 125-153, March.
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  6. Bown, Chad P., 2005. "Trade remedies and World Trade Organization dispute settlement : Why are so few challenged?," Policy Research Working Paper Series 3540, The World Bank.
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  8. Simeon Djankov & Bernard Hoekman, 1998. "Conditions of Competition and Multilateral Surveillance," The World Economy, Wiley Blackwell, vol. 21(8), pages 1109-1128, November.
  9. Eschenbach, Felix & Hoekman, Bernard, 2006. "Services policies in transition economies: on the EU and WTO as commitment mechanisms," World Trade Review, Cambridge University Press, vol. 5(03), pages 415-443, November.
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  11. Chad P. Bown, 2005. "Participation in," World Bank Economic Review, World Bank Group, vol. 19(2), pages 287-310.
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  18. Chad P. Bown, 2004. "On the Economic Success of GATT/WTO Dispute Settlement," The Review of Economics and Statistics, MIT Press, vol. 86(3), pages 811-823, August.
  19. Kyle Bagwell & Robert W. Staiger, 2004. "The Economics of the World Trading System," MIT Press Books, The MIT Press, edition 1, volume 1, number 0262524341, December.
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Citations

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Cited by:
  1. Bernard Hoekman, 2008. "The General Agreement on Trade in Services: Doomed to Fail? Does it Matter?," Journal of Industry, Competition and Trade, Springer, vol. 8(3), pages 295-318, December.
  2. Manfred Elsig, 2010. "The World Trade Organization at work: Performance in a member-driven milieu," The Review of International Organizations, Springer, vol. 5(3), pages 345-363, September.
  3. Hoekman, Bernard & Sekkat, Khalid, 2010. "Arab Economic Integration: Missing links," CEPR Discussion Papers 7807, C.E.P.R. Discussion Papers.

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