International Trade and Domestic Regulation
Existing formal models of the relationship between trade policy and regulatory policy suggest the potential for a regulatory race to the bottom. WTO rules and disputes, however, center on complaints about excessively stringent regulations. This paper bridges the gap between the existing formal literature and the actual pattern of rules and disputes. Employing the terms-of-trade framework for the modeling of trade agreements, we show how "large" nations may have an incentive to impose discriminatory product standards against imported goods once border instruments are constrained, and how inefficiently stringent standards may emerge under certain circumstances even if regulatory discrimination is prohibited. We then assess the WTO legal framework in light of our results, arguing that it does a reasonably thorough job of policing regulatory discrimination, but that it does relatively little to address excessive nondiscriminatory regulations.
|Date of creation:||Nov 2009|
|Date of revision:|
|Publication status:||published as International Trade, National Treatment and Domestic Regulation (with Alan Sykes), Journal of Legal Studies, January 2011|
|Contact details of provider:|| Postal: |
Web page: http://www.nber.org
More information through EDIRC
References listed on IDEAS
Please report citation or reference errors to , or , if you are the registered author of the cited work, log in to your RePEc Author Service profile, click on "citations" and make appropriate adjustments.:
- Horn, Henrik, 2006.
"National Treatment in the GATT,"
Working Paper Series
657, Research Institute of Industrial Economics.
- Ludema, Rodney D & Wooton, Ian, 1997. "International Trade Rules and Environmental Cooperation under Asymmetric Information," International Economic Review, Department of Economics, University of Pennsylvania and Osaka University Institute of Social and Economic Research Association, vol. 38(3), pages 605-25, August.
- Grossman, G.M. & Helpman, E., 1992.
"Protection for Sale,"
162, Princeton, Woodrow Wilson School - Public and International Affairs.
- Grossman, G.M. & Helpman, E., 1992. "Protection for Sale," Papers 21-92, Tel Aviv.
- Gene M. Grossman & Elhanan Helpman, 1992. "Protection For Sale," NBER Working Papers 4149, National Bureau of Economic Research, Inc.
- Grossman, Gene & Helpman, Elhanan, 1993. "Protection for Sale," CEPR Discussion Papers 827, C.E.P.R. Discussion Papers.
- Schwartz, Warren F & Sykes, Alan O, 2002. "The Economic Structure of Renegotiation and Dispute Resolution in the World Trade Organization," The Journal of Legal Studies, University of Chicago Press, vol. 31(1), pages S179-204, January.
- Josh Ederington, 2001. "International Coordination of Trade and Domestic Policies," American Economic Review, American Economic Association, vol. 91(5), pages 1580-1593, December.
- Rodney D. Ludema & Ian Wooton, 1994.
"Cross-Border Externalities and Trade Liberalization: The Strategic Control of Pollution,"
Canadian Journal of Economics,
Canadian Economics Association, vol. 27(4), pages 950-66, November.
- Ludema, R.D. & Wooton, I., 1992. "Cross-Border Externalities and trade Liberalization: The Strategic Control of Pollution," UWO Department of Economics Working Papers 9202, University of Western Ontario, Department of Economics.
- Robert W. Staiger & Kyle Bagwell, 1999.
"An Economic Theory of GATT,"
American Economic Review,
American Economic Association, vol. 89(1), pages 215-248, March.
- Rodney Ludema & Taizo Takeno, 2006.
"Tariffs and the Adoption of Clean Technology Under Asymmetric Information,"
gueconwpa~06-06-09, Georgetown University, Department of Economics.
- Rodney D. Ludema & Taizo Takeno, 2007. "Tariffs and the adoption of clean technology under asymmetric information," Canadian Journal of Economics, Canadian Economics Association, vol. 40(4), pages 1100-1117, November.
- Costinot, Arnaud, 2008.
"A Comparative Institutional Analysis of Agreements on Product Standards,"
University of California at San Diego, Economics Working Paper Series
qt09f6660d, Department of Economics, UC San Diego.
- Costinot, Arnaud, 2008. "A comparative institutional analysis of agreements on product standards," Journal of International Economics, Elsevier, vol. 75(1), pages 197-213, May.
- Kyle Bagwell & Robert W. Staiger, 2004. "The Economics of the World Trading System," MIT Press Books, The MIT Press, edition 1, volume 1, number 0262524341, June.
- Christian Broda & Nuno Limao & David E. Weinstein, 2008. "Optimal Tariffs and Market Power: The Evidence," American Economic Review, American Economic Association, vol. 98(5), pages 2032-65, December.
- Pierpaolo Battigalli & Giovanni Maggi, 2003.
"International agreements on product standard: an incomplete contracting theory,"
NBER Working Papers
9533, National Bureau of Economic Research, Inc.
- Pierpaolo Battigalli & Giovanni Maggi, 2003. "International agreements on product standards: an incomplete-contracting theory," Working Papers 229, IGIER (Innocenzo Gasparini Institute for Economic Research), Bocconi University.
- Sumeet Gulati & Devesh Roy, 2008. "National Treatment and the optimal regulation of environmental externalities," Canadian Journal of Economics, Canadian Economics Association, vol. 41(4), pages 1445-1471, November.
- Kyle Bagwell & Robert W. Staiger, 1999.
"Domestic Policies, National Sovereignty and International Economic Institutions,"
NBER Working Papers
7293, National Bureau of Economic Research, Inc.
- Kyle Bagwell & Robert W. Staiger, 2001. "Domestic Policies, National Sovereignty, And International Economic Institutions," The Quarterly Journal of Economics, MIT Press, vol. 116(2), pages 519-562, May.
- Markusen, James R., 1975. "International externalities and optimal tax structures," Journal of International Economics, Elsevier, vol. 5(1), pages 15-29, February.
- Kyle Bagwell, 2009. "Self-Enforcing Trade Agreements and Private Information," NBER Working Papers 14812, National Bureau of Economic Research, Inc.
- Donald H. Regan, 2006. "What Are Trade Agreements For? -- Two Conflicting Stories Told by Economists, With a Lesson for Lawyers," Journal of International Economic Law, Oxford University Press, vol. 9(4), pages 951-988, December.
When requesting a correction, please mention this item's handle: RePEc:nbr:nberwo:15541. 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: ()
If references are entirely missing, you can add them using this form.