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Developing Countries as Plaintiffs and Defendants in GATT/WTO Trade Disputes

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  • Chad P. Bown

Abstract

Developing countries have been increasing their participation in the formal institutions and proceedings of the multilateral trading system. A prominent example is their more frequent involvement as defendants and plaintiffs in GATT/WTO trade disputes. This paper provides an initial economic appraisal of developing country performance in the GATT/WTO dispute settlement system. We measure the economic resolution of these disputes through trade liberalisation gains, and our results suggest that developing country plaintiffs have had more success under WTO disputes than was the case under the GATT. We also document evidence on potential determinants of this success: the capacity for plaintiffs to make credible retaliatory threats and the guilty determinations by GATT/WTO panels. Finally, there is also some evidence that developing countries have recognised the importance of retaliatory threats and have responded by changing their pattern of dispute initiation under the WTO to better take advantage of the instances in which they have sufficient leverage to threaten retaliation and induce compliance with GATT/WTO obligations.

Suggested Citation

  • Chad P. Bown, 2004. "Developing Countries as Plaintiffs and Defendants in GATT/WTO Trade Disputes," The World Economy, Wiley Blackwell, vol. 27(1), pages 59-80, January.
    • Handle: RePEc:bla:worlde:v:27:y:2004:i:1:p:59-80
    DOI: 10.1111/j.1467-9701.2004.00588.x
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    1. Colleen Hamilton & John Whalley, 1995. "Evaluating the Impact of the Uruguay Round Results on Developing Countries," The World Economy, Wiley Blackwell, vol. 18(1), pages 31-49, January.
    2. Blonigen, Bruce A. & Bown, Chad P., 2003. "Antidumping and retaliation threats," Journal of International Economics, Elsevier, vol. 60(2), pages 249-273, August.
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    Cited by:

    1. Bown, Chad P. & Crowley, Meredith A., 2006. "Policy externalities: How US antidumping affects Japanese exports to the EU," European Journal of Political Economy, Elsevier, vol. 22(3), pages 696-714, September.
    2. Bown, Chad, 2007. "Developing Countries and Enforcement of Trade Agreements: Why Dispute Settlement Is Not Enough," CEPR Discussion Papers 6459, C.E.P.R. Discussion Papers.
    3. Horn, Henrik & Mavroidis, Petros C., 2006. "A Survey of the Literature on the WTO Dispute Settlement System," Working Paper Series 684, Research Institute of Industrial Economics.
    4. Nuno Limão & Kamal Saggi, 2018. "Tariff retaliation versus financial compensation in the enforcement of international trade agreements," World Scientific Book Chapters, in: Kamal Saggi (ed.), Economic Analysis of the Rules and Regulations of the World Trade Organization, chapter 13, pages 299-311, World Scientific Publishing Co. Pte. Ltd..
    5. Francois, Joseph & Horn, Henrik & Kaunitz, Niklas, 2008. "Trading Profiles and Developing Country Participation in the WTO Dispute Settlement System," Working Paper Series 730, Research Institute of Industrial Economics.
    6. Tan Li & Larry D. Qiu, 2021. "Beyond trade creation: Preferential trade agreements and trade disputes," Pacific Economic Review, Wiley Blackwell, vol. 26(1), pages 23-53, February.
    7. Jakubik, Adam & Piermartini, Roberta, 2023. "How WTO commitments tame uncertainty," European Economic Review, Elsevier, vol. 157(C).
    8. Antoine Bouët & Jeanne Métivier, 2020. "Is the dispute settlement system, “jewel in the WTO’s crown”, beyond reach of developing countries?," Review of World Economics (Weltwirtschaftliches Archiv), Springer;Institut für Weltwirtschaft (Kiel Institute for the World Economy), vol. 156(1), pages 1-38, February.
    9. Feinberg Robert M., 2011. "Antidumping as a Development Issue," Global Economy Journal, De Gruyter, vol. 11(3), pages 1-17, September.
    10. Julián Tole Martínez, 2014. "Solución de controversias en los TLC. Aportes del Derecho de la OMC," Books, Universidad Externado de Colombia, Facultad de Derecho, edition 1, volume 1, number 702.
    11. Götz, Christian & Heckelei, Thomas & Rudloff, Bettina, 2010. "What makes countries initiate WTO disputes on food-related issues?," Food Policy, Elsevier, vol. 35(2), pages 154-162, April.
    12. Antoine Bouet & Jeanne Métivier, 2017. "Is the WTO Dispute Settlement Procedure Fair for Developing Countries?," Working Papers hal-02149414, HAL.
    13. Johannes Urpelainen, 2009. "Political-economic problems in trade capacity building," The Review of International Organizations, Springer, vol. 4(4), pages 329-359, December.
    14. Johan Lindeque & Steven McGuire, 2007. "The United States and trade disputes in the World Trade Organization: Hegemony constrained or confirmed?," Management International Review, Springer, vol. 47(5), pages 725-744, September.
    15. R A Read, 2005. "Trade dispute settlement mechanisms: the WTO dispute settlement understanding in the wake of the GATT," Working Papers 564824, Lancaster University Management School, Economics Department.
    16. Khan, Haider & Liu, Yibei, 2008. "Globalization and the WTO Dispute Settlement Mechanism: Making a Rules-based Trading Regime Work," MPRA Paper 7613, University Library of Munich, Germany, revised 2008.
    17. Bagwell, Kyle & Mavroidis, Petros C. & Staiger, Robert W., 2007. "Auctioning countermeasures in the WTO," Journal of International Economics, Elsevier, vol. 73(2), pages 309-332, November.
    18. Goetz, Christian & Heckelei, Thomas, 2009. "The determinants of bilateral World Trade Organization disputes in the agro-food sector," 2009 Annual Meeting, July 26-28, 2009, Milwaukee, Wisconsin 49461, Agricultural and Applied Economics Association.
    19. Wilfred J. Ethier, 2003. "TRIPS, externalities, trade agreements, hostages," PIER Working Paper Archive 03-034, Penn Institute for Economic Research, Department of Economics, University of Pennsylvania.
    20. Fabien BESSON & Racem MEHDI, 2010. "Is WTO Dispute Settlement System Biased Against Developing Countries? An Empirical Analysis," EcoMod2004 330600022, EcoMod.

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