A 'New Trade' Theory of GATT/WTO Negotiations

Ralph Ossa

CEP Discussion Papers from Centre for Economic Performance, LSE

Abstract: I develop a novel theory of GATT/WTO negotiations. This theory provides new answers to two prominent questions in the trade policy literature: first, what is the purpose of trade negotiations? And second, what is the role played by the fundamental GATT/WTO principles of reciprocity and nondiscrimination? Relative to the standard terms-of-trade theory of GATT/WTO negotiations, my theory makes two main contributions: first, it builds on a 'new trade' model rather than the neoclassical trade model and therefore sheds new light on GATT/WTO negotiations between similar countries. Second, it relies on a production relocation externality rather than the terms-of-trade externality and therefore demonstrates that the terms-of-trade externality is not the only trade policy externality which can be internalized in GATT/WTO negotiations.

Keywords: Trade negotiations; GATT/WTO; New trade theory (search for similar items in EconPapers)
JEL-codes: F12 F13 (search for similar items in EconPapers)
Date: 2008-06
New Economics Papers: this item is included in nep-int
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Citations: View citations in EconPapers (1)

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Related works:
Working Paper: A 'New Trade' Theory of GATT/WTO Negotiations (2010)
Working Paper: A 'new trade' theory of GATT/WTO negotiations (2008)
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Persistent link: https://EconPapers.repec.org/RePEc:cep:cepdps:dp0877

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