Safeguards and voluntary export restraints under the World Trade Organization

Koichi Kagitani and Kozo Harimaya

Japan and the World Economy, 2015, vol. 36, issue C, 29-41

Abstract: Though the WTO agreement of safeguards prohibits VERs, WTO members can still use VERs without formal intergovernmental agreements. Our theoretical analysis shows that the fear of invoking a safeguard measure by an importing country on a good can induce a disruptive exporter of the good to enforce such a VER under certain conditions (for example, if the number of exporting country is not large). Our empirical analysis, using Japan's first safeguard actions as a case study, suggests that if producers of an exporting country capture an export market and if there is a large drop in their export price, the producers seeing a growing threat of safeguards will enforce such VERs. Our results highlight the need for amendments to the WTO Agreement on Safeguards.

Keywords: Safeguards; Voluntary export restraints; WTO; Political economy; Agricultural trade (search for similar items in EconPapers)
JEL-codes: D72 D73 F13 (search for similar items in EconPapers)
Date: 2015
References: View references in EconPapers View complete reference list from CitEc
Citations: View citations in EconPapers (2)

Downloads: (external link)
http://www.sciencedirect.com/science/article/pii/S0922142515000304
Full text for ScienceDirect subscribers only

Related works:
This item may be available elsewhere in EconPapers: Search for items with the same title.

Export reference: BibTeX RIS (EndNote, ProCite, RefMan) HTML/Text

Persistent link: https://EconPapers.repec.org/RePEc:eee:japwor:v:36:y:2015:i:c:p:29-41

DOI: 10.1016/j.japwor.2015.06.001

Access Statistics for this article

Japan and the World Economy is currently edited by Robert Dekle and Yasushi Hamao

More articles in Japan and the World Economy from Elsevier
Bibliographic data for series maintained by Catherine Liu ().