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Why Are So Many WTO Disputes Abandoned?

Author

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  • Kara M. Reynolds

    (Department of Economics, American University)

Abstract

Previous research on the success of the WTO dispute settlement system may miscalculate the true benefits of the dispute process due to the nature of the datasets used. Approximately 33 percent of all disputes filed at the WTO are classified as pending or inactive, and thus omitted from most studies. Further investigation reveals that many of these inactive cases were actually settled by the countries involved or considered in a similar WTO dispute and, as a result, no further WTO action was taken. This suggests that the WTO dispute settlement process may be more effective in resolving disputes than otherwise thought. For those disputes not successfully resolved, I empirically estimate why countries may choose to initiate WTO dispute settlement action but fail to follow through, thus allowing the offending party to continue with the alleged WTO-illegal activities. The results suggest that developing countries are less likely to resolve their complaints in the WTO dispute settlement system, a troubling implication for the equity of the system.

Suggested Citation

  • Kara M. Reynolds, 2007. "Why Are So Many WTO Disputes Abandoned?," Working Papers 2007-05, American University, Department of Economics.
    • Handle: RePEc:amu:wpaper:0507
    DOI: 10.17606/pp10-nj49
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    File URL: https://doi.org/10.17606/pp10-nj49
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    Cited by:

    1. Chad Bown & Kara Reynolds, 2015. "Trade flows and trade disputes," The Review of International Organizations, Springer, vol. 10(2), pages 145-177, June.
    2. Kara M. Reynolds & Chad P. Bown, 2014. "Trade Flows and Trade Disputes," Working Papers 2014-05, American University, Department of Economics.

    More about this item

    Keywords

    WTO Dispute Settlement;

    JEL classification:

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

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