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Gatt, Dispute Settlement And Cooperation

  • DAN KOVENOCK
  • MARIE THURSBY

This paper analyzes GATT and its dispute settlement procedure (DSP) in the context of a supergame model of international trade featuring both explicit and implicit agreements. An explicit agreement, such as GATT, may be violated at some positive cost in addition to retaliatory actions that might be induced by the violation. We interpret this cost as arising from "international obligation", a phenomenon frequently mentioned in the legal literature on GATT. We focus on how international obligation affects two aspects of GATT-DSP: unilateral retaliation and the effect of inordinate delays in the operation of DSP. Copyright 1992 Blackwell Publishers Ltd..

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Article provided by Wiley Blackwell in its journal Economics & Politics.

Volume (Year): 4 (1992)
Issue (Month): 2 (07)
Pages: 151-170

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Handle: RePEc:bla:ecopol:v:4:y:1992:i:2:p:151-170
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  1. Edward J Green & Robert H Porter, 1997. "Noncooperative Collusion Under Imperfect Price Information," Levine's Working Paper Archive 1147, David K. Levine.
  2. Hungerford, T.L., 1990. "Gatt: A Cooperative Equilibrium In A Noncooperative Trading Regime?," Working Papers 262, Research Seminar in International Economics, University of Michigan.
  3. 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.
  4. Robert C. Feenstra & Tracy R. Lewis, 1987. "Negotiated Trade Restrictions with Private Political Pressure," NBER Working Papers 2374, National Bureau of Economic Research, Inc.
  5. Dilip Abreu & Paul Milgrom & David Pearce, 1997. "Information and timing in repeated partnerships," Levine's Working Paper Archive 636, David K. Levine.
  6. Kyle Bagwell & Robert W. Staiger, 1988. "A Theory of Managed Trade," NBER Working Papers 2756, National Bureau of Economic Research, Inc.
  7. Riezman, Raymond, 1991. "Dynamic tariffs with asymmetric information," Journal of International Economics, Elsevier, vol. 30(3-4), pages 267-283, May.
  8. Baldwin, Robert E. & Clarke, Richard N., 1987. "Game-modeling multilateral trade negotiations," Journal of Policy Modeling, Elsevier, vol. 9(2), pages 257-284.
  9. Brown, Fred & Whalley, John, 1980. "General Equilibrium Evaluations of Tariff-Cutting Proposals in the Tokyo Round and Comparisons with More Extensive Liberalisation of World Trade," Economic Journal, Royal Economic Society, vol. 90(363), pages 838-66, December.
  10. Chan, Kenneth S., 1988. "Trade negotiations in a Nash bargaining model," Journal of International Economics, Elsevier, vol. 25(3-4), pages 353-363, November.
  11. Mayer, Wolfgang, 1981. "Theoretical Considerations on Negotiated Tariff Adjustments," Oxford Economic Papers, Oxford University Press, vol. 33(1), pages 135-53, March.
  12. Crawford, Vincent P, 1982. "A Theory of Disagreement in Bargaining," Econometrica, Econometric Society, vol. 50(3), pages 607-37, May.
  13. Segerstrom, Paul S., 1988. "Demons and repentance," Journal of Economic Theory, Elsevier, vol. 45(1), pages 32-52, June.
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