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Regulatory autonomy and multilateral disciplines: The dilemma and a possible resolution

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  • Mattoo, Aaditya
  • Subramanian, Arvind

Abstract

A major challenge for the multilateral trading system is to secure the benefits of trade liberalization without infringing on the freedom of governments to pursue legitimate domestic objectives. The difficulty lies in distinguishing between two types of situations. In one, a non-protectionist government cannot prevent certain domestic policies from incidentally discriminating against foreign competitors. In the other, a protectionist government uses a legitimate objective as an excuse to design domestic policies which inhibit foreign competition. The challenge is to devise rules which are sensitive to the difference between these two situations, exonerating the former while preventing the latter. The approach suggested in this paper is to create a presumption in favour of the economically efficient policy measure, with departures inviting justification.

Suggested Citation

  • Mattoo, Aaditya & Subramanian, Arvind, 1998. "Regulatory autonomy and multilateral disciplines: The dilemma and a possible resolution," WTO Staff Working Papers TISD-98-02, World Trade Organization (WTO), Economic Research and Statistics Division.
    • Handle: RePEc:zbw:wtowps:tisd9802
    DOI: 10.30875/58942cae-en
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    References listed on IDEAS

    as
    1. Daniel Esty, 1994. "Greening the GATT: Trade, Environment, and the Future," Peterson Institute Press: All Books, Peterson Institute for International Economics, number 40, October.
    2. Arvind Subramanian, 1992. "Trade Measures for Environment: A Nearly Empty Box?," The World Economy, Wiley Blackwell, vol. 15(1), pages 135-152, January.
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    Citations

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    Cited by:

    1. Aaditya Mattoo & Robert M. Stern, 2003. "India and the WTO," World Bank Publications - Books, The World Bank Group, number 15082, December.
    2. Jansen, Marion & Keck, Alexander, 2004. "National environmental policies and multilateral trade rules," WTO Staff Working Papers ERSD-2004-01, World Trade Organization (WTO), Economic Research and Statistics Division.
    3. Bernard Hoekman, 2002. "Developing Countries and the Political Economy of the Trading System," WIDER Working Paper Series DP2002-126, World Institute for Development Economic Research (UNU-WIDER).
    4. Bernard Hoekman & Aaditya Mattoo, 2000. "Services, economic development and the next round of negotiations on services," Journal of International Development, John Wiley & Sons, Ltd., vol. 12(2), pages 283-296.
    5. Lawton, Thomas C. & McGuire, Steven M., 2001. "Supranational governance and corporate strategy: the emerging role of the World Trade Organization," International Business Review, Elsevier, vol. 10(2), pages 217-233, April.
    6. Neven, Damien J., 2001. "How should "protection" be evaluated in Article III GATT disputes?," European Journal of Political Economy, Elsevier, vol. 17(2), pages 421-444, June.

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    More about this item

    Keywords

    international trade; regulation; national treatment; protection;
    All these keywords.

    JEL classification:

    • F13 - International Economics - - Trade - - - Trade Policy; International Trade Organizations
    • K20 - Law and Economics - - Regulation and Business Law - - - General
    • K33 - Law and Economics - - Other Substantive Areas of Law - - - International Law

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