Punishment and Dispute Settlement in Trade Agreements

Arbeitspapier

This paper interprets dispute settlement procedures and punishments as responses to the fact that trade agreements are incomplete contracts. If no weight is given to the adjudication phase and if the degree of trade relatedness is known with certainty, the negotiated trade agreement will feature commensurate punishments, will induce violation of the dispute settlement ruling, and will deliver optimal liberalization and optimal unilateral trade-related action. With the adjudication phase of concern, the trade agreement will feature less liberalization, but still with a presumption of at least approximate commensurate punishment. The optimal trade agreement will likely induce abiding by the ruling when negotiators attach more importance to the adjudication phase, and violating it when they attach less.

Object Details

• Language: Englisch

References and Relationships

• Bibliographic citation: Series: EPRU Working Paper Series ; No. 2001-14

Classification and Topics

• Classification: Wirtschaft
• Subject: Handelsabkommen ; Unvollständiger Vertrag ; Schiedsgerichtsbarkeit ; Theorie

Contributors, Places and Time

• Event: Geistige Schöpfung
• (who): Ethier, Wilfried J.
• Event: Veröffentlichung
• (who): University of Copenhagen, Economic Policy Research Unit (EPRU)
• (where): Copenhagen
• (when): 2001

Further information

• Handle: http://hdl.handle.net/10419/82069
• Last update: 10.03.2025, 11:42 AM CET