Gatt, Dispute Settlement and Cooperation
Marie C. Thursby
Georgia Institute of Technology - Strategic Management Area; National Bureau of Economic Research (NBER)
Chapman University - Economic Science Institute; CESifo (Center for Economic Studies and Ifo Institute)
NBER Working Paper No. w4071
This paper analyzes GATT and its dispute settlement procedure (DSP) in the context of a supergame model of international trade featuring both explicit and implicit agreements. An explicit agreement, such as GATT, may be violated at some positive cost in addition to retaliatory actions that might be induced by the violation. We interpret this cost as arising from 'international obligation," a phenomenon frequently mentioned in the legal literature on GATT. We focus on how international obligation affects two aspects of GAIT-DSP: unilateral retaliation and the effect of inordinate delays in the operation of DSP.
Number of Pages in PDF File: 34
Date posted: May 3, 2004
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