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The Politics of WTO Enforcement Mechanisms

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Author Info
Pao-Li Chang

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Abstract

This paper analyzes the influence of domestic political considerations by disputing governments on the WTO enforcement outcome, following a violation ruling against the defendant. Since a different mix of import or export sectors in the disputing countries will benefit from the alternative enforcement outcomes – compliance, compensation, retaliation, and the status quo, they become competing forces that steer the strategic interactions between the disputing governments. This paper first studies the complainant’s retaliation capacity and strategy in formulating the retaliation list, and then examines the scope of settlement possibilities between the disputing parties. The results of the paper provide a synopsis of the disputing governments’ political payoffs under the alternative enforcement scenarios and the conditions that determine the outcome of the implementation

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Publisher Info
Paper provided by Econometric Society in its series Econometric Society 2004 Australasian Meetings with number 117.

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Date of creation: 11 Aug 2004
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Handle: RePEc:ecm:ausm04:117

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Related research
Keywords: trade sanction enforcement failure compliance compensation political economy

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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

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  1. Anderson, Kym, 2002. "Peculiarities of retaliation in WTO dispute settlement," World Trade Review, Cambridge University Press, vol. 1(02), pages 123-134, August. [Downloadable!]
    Other versions:
  2. Monika BÜTLER & Heinz HAUSER, 2000. "The WTO Dispute Settlement System : A First Assessment from an Economic Perspective," Cahiers de Recherches Economiques du Département d'Econométrie et d'Economie politique (DEEP) 00.02, Université de Lausanne, Faculté des HEC, DEEP. [Downloadable!]
    Other versions:
  3. Pao-Li Chang, 2002. "The Evolution and Utilization of the GATT/WTO Dispute Settlement Mechanism," Working Papers 475, Research Seminar in International Economics, University of Michigan. [Downloadable!]
  4. Ludema, Rodney D., 2001. "Optimal international trade agreements and dispute settlement procedures," European Journal of Political Economy, Elsevier, vol. 17(2), pages 355-376, June. [Downloadable!] (restricted)
  5. 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:
  6. Bown, Chad P., 2002. "Why are safeguards under the WTO so unpopular?," World Trade Review, Cambridge University Press, vol. 1(01), pages 47-62, April. [Downloadable!]
  7. Hungerford, Thomas L., 1991. "GATT: A cooperative equilibrium in a noncooperative trading regime?," Journal of International Economics, Elsevier, vol. 31(3-4), pages 357-369, November. [Downloadable!] (restricted)
  8. Dan Kovenock & Marie Thursby, 1992. "GATT, Dispute Settlement and Cooperation," NBER Working Papers 4071, National Bureau of Economic Research, Inc. [Downloadable!] (restricted)
  9. Giovanni Maggi, 1999. "The Role of Multilateral Institutions in International Trade Cooperation," American Economic Review, American Economic Association, vol. 89(1), pages 190-214, March. [Downloadable!] (restricted)
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This page was last updated on 2008-10-31.

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