IDEAS home Printed from
   My bibliography  Save this article

WTO Enforcement Issues


  • Pelzman Joseph

    () (George Washington University, U.S., and Ben-Gurion University of the Negev, Beer Sheva, Israel)

  • Shoham Amir

    () (College of Management, Rishon L’Tzion, Israel, and Sapir Academic College, Israel)


In theory, the WTO dispute settlement system is expected, via an elaborate system of sequential legal maneuvers to ensure the implementation of the dispute settlement body (DSB) recommendations. In reality when trade issues rise above some critical threshold to a respondent, the theory behind the DSU enforcement breaks down and the well meaning legal system only leads to prolonging the dispute rather than resolving it. Since 1995, more than 300 complaints have been filed through the WTO dispute settlement system. In most cases, the parties reach a mutually satisfactory solution in accordance with the WTO Agreements through consultations without having recourse to the panel and Appellate Body review. When the consultation process fails the resulting process of Panel reports and Appellate Body reports result in a removal or modification of the violating measures. In those cases where there is no removal or modification of the violating measures, the period of non-compliance tends to be very long and leads to core questions about the true intent of the DSU. In particular, was the DSU designed to ensure a legal process for the settlement of a dispute and to recommend a remedy to the offending violation but was not designed to secure compliance.The intent of this paper is to show that this is indeed the case. Moreover, if one treats the WTO as a contract, then the non-compliance issue may be viewed as an `efficient breach' and the only efficient remedy is a `fine' rather than the usual practice of suspension of concessions or other obligations to the offending Member. Under our suggested enforcement rules, it may be possible for a Member to continue to breach her obligation to the WTO contract while simultaneously compensating for damages created by the offending measure. The end result will be more efficient than the current system of diplomatic maneuvering designed to pressure the Member to remove or modify the offending measure.

Suggested Citation

  • Pelzman Joseph & Shoham Amir, 2007. "WTO Enforcement Issues," Global Economy Journal, De Gruyter, vol. 7(1), pages 1-27, February.
  • Handle: RePEc:bpj:glecon:v:7:y:2007:i:1:n:4

    Download full text from publisher

    File URL:
    Download Restriction: For access to full text, subscription to the journal or payment for the individual article is required.

    As the access to this document is restricted, you may want to search for a different version of it.

    References listed on IDEAS

    1. Martin, Stephen & Scott, John T., 2000. "The nature of innovation market failure and the design of public support for private innovation," Research Policy, Elsevier, vol. 29(4-5), pages 437-447, April.
    2. Karolina Ekholm & Johan Torstensson, 1997. "High-Technology Subsidies in General Equilibrium: A Sector-Specific Approach," Canadian Journal of Economics, Canadian Economics Association, vol. 30(4), pages 1184-1203, November.
    3. Isabel Busom, 2000. "An Empirical Evaluation of The Effects of R&D Subsidies," Economics of Innovation and New Technology, Taylor & Francis Journals, vol. 9(2), pages 111-148.
    4. Minoru Kitahara & Toshihiro Matsumura, 2006. "Realized Cost-Based Subsidies For Strategic R&D Investments With "Ex Ante" And "Ex Post" Asymmetries," The Japanese Economic Review, Japanese Economic Association, vol. 57(3), pages 438-448.
    5. Poyago-Theotoky, Joanna, 1998. "R&D Competition in a Mixed Duopoly under Uncertainty and Easy Imitation," Journal of Comparative Economics, Elsevier, vol. 26(3), pages 415-428, September.
    6. Miyagiwa, Kaz & Ohno, Yuka, 2002. "Uncertainty, spillovers, and cooperative R&D," International Journal of Industrial Organization, Elsevier, vol. 20(6), pages 855-876, June.
    7. Klette, T.J. & Moen, J. & Griliches, Z., 1999. "Do Subsidies to Commercial R&D Reduce Market Failures? Microeconometric Evaluation Studies," Papers 16/99, Norwegian School of Economics and Business Administration-.
    8. Lakdawalla, Darius & Sood, Neeraj, 2004. "Social insurance and the design of innovation incentives," Economics Letters, Elsevier, vol. 85(1), pages 57-61, October.
    9. Petrakis, Emmanuel & Poyago-Theotoky, Joanna, 2002. "R&D Subsidies versus R&D Cooperation in a Duopoly with Spillovers and Pollution," Australian Economic Papers, Wiley Blackwell, vol. 41(1), pages 37-52, March.
    Full references (including those not matched with items on IDEAS)

    More about this item


    Access and download statistics


    All material on this site has been provided by the respective publishers and authors. You can help correct errors and omissions. When requesting a correction, please mention this item's handle: RePEc:bpj:glecon:v:7:y:2007:i:1:n:4. See general information about how to correct material in RePEc.

    For technical questions regarding this item, or to correct its authors, title, abstract, bibliographic or download information, contact: (Peter Golla). General contact details of provider: .

    If you have authored this item and are not yet registered with RePEc, we encourage you to do it here. This allows to link your profile to this item. It also allows you to accept potential citations to this item that we are uncertain about.

    We have no references for this item. You can help adding them by using this form .

    If you know of missing items citing this one, you can help us creating those links by adding the relevant references in the same way as above, for each refering item. If you are a registered author of this item, you may also want to check the "citations" tab in your RePEc Author Service profile, as there may be some citations waiting for confirmation.

    Please note that corrections may take a couple of weeks to filter through the various RePEc services.

    IDEAS is a RePEc service hosted by the Research Division of the Federal Reserve Bank of St. Louis . RePEc uses bibliographic data supplied by the respective publishers.