Rethinking International Subsidy Rules

Doug R Nelson
Authors registered in the RePEc Author Service: Bernard Hoekman

No 14833, CEPR Discussion Papers from C.E.P.R. Discussion Papers

Abstract: Geo-economic tensions, notably associated with the rise of China, and global collective action problems – climate change; the COVID-19 pandemic – call for international cooperation to revise and develop rules to guide both the use of domestic subsidies and responses by governments to cross-border competition spillover effects. Current WTO rules dividing all subsidies into prohibited or actionable categories are no longer fit for purpose. Piecemeal efforts in preferential trade agreements and bi- or trilateral configurations offer a basis on which to build but are too narrow in scope. Addressing spillover effects of subsidies could start with G20 countries launching a work program to mobilize an epistemic community concerned with subsidy policies, tasked with building a more solid evidence base on the magnitude, purpose and effects of subsidy policies. The need for such cooperation has become even more pressing by the COVID-19 pandemic and the associated increase in the use of subsidy programs in major economies.

Keywords: Subsidy policies; Spillovers; International cooperation; G20; Wto (search for similar items in EconPapers)
JEL-codes: E61 F02 F15 (search for similar items in EconPapers)
Date: 2020-05
New Economics Papers: this item is included in nep-int
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Citations: View citations in EconPapers (19)

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Journal Article: Rethinking international subsidy rules (2020)
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