Do WTO Disputes Actually Increase Trade?

40 Pages Posted: 1 Aug 2013

See all articles by Stephen Chaudoin

Stephen Chaudoin

University of Illinois at Urbana-Champaign

Jeffrey Kucik

University College London

Krzysztof Pelc

McGill University

Date Written: 2013

Abstract

At a time when multilateral trade negotiations are failing, the World Trade Organization’s Dispute Settlement Understanding (DSU) is widely seen as the paragon of legalized dispute settlement and is thought to play a key role in liberalizing world trade. We ask a simple empirical question with important theoretical implications: do WTO disputes increase trade? We systematically analyze the effects of WTO disputes on a country’s imports at the product level.

We find that WTO disputes do not, on average, increase a country’s imports of the products at issue. We find only very specific effects of disputes based on the dispute outcome and issue-area. We find significant variation across countries in their responsiveness to disputes, yet that most common explanations cannot account for this variation. This article highlights and begins to fill a significant gap in our understanding of the purpose of the WTO and its effects on trade.

Keywords: International Trade, International Political Economy, WTO, Dispute Settlement

Suggested Citation

Chaudoin, Stephen and Kucik, Jeffrey and Pelc, Krzysztof, Do WTO Disputes Actually Increase Trade? (2013). APSA 2013 Annual Meeting Paper, American Political Science Association 2013 Annual Meeting, Available at SSRN: https://ssrn.com/abstract=2299651

Stephen Chaudoin (Contact Author)

University of Illinois at Urbana-Champaign ( email )

702 S. Wright Street
Urbana, IL 61801
United States

Jeffrey Kucik

University College London ( email )

Gower Street
London, WC1E 6BT
United Kingdom

Krzysztof Pelc

McGill University ( email )

855 Sherbrooke St. W
Montreal, Quebec H3A 2T7
Canada

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