On the Role of International Courts

Jasmina Karabegovic () and Christoph Kuzmics ()
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Jasmina Karabegovic: University of Graz, Austria
Christoph Kuzmics: University of Graz, Austria

No 2025-04, Graz Economics Papers from University of Graz, Department of Economics

Abstract: International cooperation sometimes requires flexible agreements that permit temporary non-compliance in certain circumstances. Whether these circumstances occur is often only privately known by the non-complying partner. This paper analyzes how an international court that can only provide information without having any enforcement power can help sustain such flexible international agreements. We study this in a repeated game setting where the monitoring is public but imperfect. We find that for sufficiently patient governments there are in principle highly efficient self-enforcing agreements available. We then focus on the case of impatient governments and identify conditions under which an international court without enforcement power could indeed improve the efficiency of agreements.

Keywords: Repeated games; imperfect public monitoring; international trade; dispute resolution (search for similar items in EconPapers)
JEL-codes: C72 C73 D02 F13 (search for similar items in EconPapers)
Date: 2025-06
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