At a time when multilateral trade negotiations are failing, the World Trade Organization’s Dispute Settlement Understanding (DSU) is widely seen as the paragon of legalized dispute settlement and is thought to play a key role in liberalizing world trade. We ask a simple empirical question with important theoretical implications: do WTO disputes increase trade? We systematically analyze the effects of WTO disputes on a country’s imports at the product level.
We find that WTO disputes do not, on average, increase a country’s imports of the products at issue. We find only very specific effects of disputes based on the dispute outcome and issue-area. We find significant variation across countries in their responsiveness to disputes, yet that most common explanations cannot account for this variation. This article highlights and begins to fill a significant gap in our understanding of the purpose of the WTO and its effects on trade.
Thursday, August 22, 2013
Chaudoin, Kucik, & Pelc: Do WTO Disputes Actually Increase Trade?
Stephen Chaudoin (Univ. of Pittsburgh - Political Science), Jeffrey Kucik (Univ. College London - Political Science), & Krzysztof Pelc (McGill Univ. - Political Science) have posted Do WTO Disputes Actually Increase Trade? Here's the abstract: