34 Pages Posted: 3 May 2004 Last revised: 29 Oct 2015
Date Written: May 1992
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.
Suggested Citation: Suggested Citation
Thursby, Marie C. and Kovenock, Dan, GATT, Dispute Settlement and Cooperation (May 1992). NBER Working Paper No. w4071. Available at SSRN: https://ssrn.com/abstract=324040