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Trade policy under the GATT-WTO: empirical evidence of the equal treatment rule

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  • Chad Bown

Abstract

A fundamental difference between multilateral trade agreements like the GATT and WTO and a preferential agreement is the multilateral agreements' inclusion of a most-favoured-nation principle. Though MFN requires that members implement policies that provide equal treatment to all GATT-WTO countries, how far do members actually follow the MFN principle when so required? We empirically investigate a sample of GATT-WTO trade disputes and the effect of successful dispute settlement negotiations on the disputed product trade of third country exporters to the defendant country. We document evidence of trade liberalization consistent with defendant countries successfully applying the equal treatment rule.

Suggested Citation

  • Chad Bown, 2004. "Trade policy under the GATT-WTO: empirical evidence of the equal treatment rule," Canadian Journal of Economics, Canadian Economics Association, vol. 37(3), pages 678-720, August.
    • Handle: RePEc:cje:issued:v:37:y:2004:i:3:p:678-720
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    Cited by:

    1. Sheldon, Ian M. & Chow, Daniel C.K. & McGuire, William, "undated". "Trade Liberalization and Institutional Constraints on Moves to Protectionism: Multilateralism vs. Regionalism," 2018 Allied Social Sciences Association (ASSA) Annual Meeting, January 5-7, 2018, Philadelphia, Pennsylvania 266305, Agricultural and Applied Economics Association.
    2. Kamal Saggi, 2018. "The MFN clause, welfare, and multilateral cooperation between countries of unequal size," World Scientific Book Chapters, in: Kamal Saggi (ed.), Economic Analysis of the Rules and Regulations of the World Trade Organization, chapter 14, pages 312-323, World Scientific Publishing Co. Pte. Ltd..
    3. Shubha Ojha, 2020. "The Rise of Exceptions and the Eclipse of the Elemental Principle of Most-Favoured-Nation," Proceedings of the 18th International RAIS Conference, August 17-18, 2020 017so, Research Association for Interdisciplinary Studies.
    4. Kyle Bagwell & Robert W. Staiger, 2013. "Can the Doha Round Be a Development Round? Setting a Place at the Table," NBER Chapters, in: Globalization in an Age of Crisis: Multilateral Economic Cooperation in the Twenty-First Century, pages 91-124, National Bureau of Economic Research, Inc.
    5. Kyle Bagwell & Chad P. Bown & Robert W. Staiger, 2016. "Is the WTO Passé?," Journal of Economic Literature, American Economic Association, vol. 54(4), pages 1125-1231, December.
    6. Saggi, Kamal & Sengul, Faruk & Yildiz, Halis Murat, 2007. "Sustaining multilateral cooperation among asymmetric countries: Does MFN help?," International Review of Economics & Finance, Elsevier, vol. 16(4), pages 543-562.
    7. McCalman, Phillip, 2010. "Trade policy in a "super size me" world," Journal of International Economics, Elsevier, vol. 81(2), pages 206-218, July.
    8. Chad Bown & Kara Reynolds, 2015. "Trade flows and trade disputes," The Review of International Organizations, Springer, vol. 10(2), pages 145-177, June.

    More about this item

    JEL classification:

    • F13 - International Economics - - Trade - - - Trade Policy; International Trade Organizations

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