The Evolution and Utilization of the GATT/WTO Dispute Settlement Mechanism

Pao-Li Chang ()

No 475, Working Papers from Research Seminar in International Economics, University of Michigan

Abstract: This paper attempts to study the usage of the GATT/WTO dispute settlement mechanism and to explain its patterns across different regimes and decades, using a unified theoretical model. This study first explores the role of the degree of legal controversy over a panel ruling in determining countries' incentives to block/appeal a panel report under the GATT/WTO regime. The model is able to explain the surge in blocking incidence during the 1980s over the preceding GATT years and the immense frequency at which the new appellate procedure under the WTO is invoked. Furthermore, a two-sided asymmetric information framework is used to study the effects of political power on countries' incentives to use, and interactions in using, the GATT/WTO dispute settlement mechanism. It is shown that the magnitude of the political cost relative to the potential benefit that the complainant stands to gain when using this mechanism determines the pattern of filing activity and the frequency of various procedural outcomes. This result, when confronted with the statistics on disputes in different decades of the GATT regime, provides us an indicator of how well the dispute procedure has worked during various decades, in terms of how much this procedure has been subject to potential power politics.

Keywords: GATT/WTO; dispute settlement (search for similar items in EconPapers)
JEL-codes: F02 F13 K33 K41 K42 (search for similar items in EconPapers)
Pages: 41 Pages
Date: 2002
References: View references in EconPapers View complete reference list from CitEc
Citations: View citations in EconPapers (3)

Downloads: (external link)
http://fordschool.umich.edu/rsie/workingpapers/Papers451-475/r475.pdf

Related works:
Working Paper: The Evolution and Utilization of the GATT/WTO Dispute Settlement Mechanism (2007)
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:mie:wpaper:475

Access Statistics for this paper

More papers in Working Papers from Research Seminar in International Economics, University of Michigan Contact information at EDIRC.
Bibliographic data for series maintained by FSPP Webmaster ().