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Adjudication without Enforcement in GATT Disputes

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  • Eric Reinhardt

    (Department of Political Science, Emory University)

Abstract

Disputes under the General Agreement on Tariffs and Trade (GATT) exhibit a puzzling selection effect. Defendants concede more prior to GATT judgments than afterward, despite GATT's lack of enforcement power. Yet, why would states plea-bargain if they know they can spurn contrary rulings? To find out, the article develops an incomplete information model of trade bargaining with the option of adjudication. The plaintiff has greater resolve prior to a ruling, believing that the defendant might be compelled to concede to an adverse judgment—even if that belief later proves false. Surprisingly, this resolve induces more generous settlements even from defendants who intend not to comply with any ruling. After a ruling, however, this anticipatory effect is irrelevant: adjudication works best when threatened but not realized. The prospect of adjudication thus conditions the behavior of states even when enforcement is not forthcoming but not through mechanisms identified by previous studies.

Suggested Citation

  • Eric Reinhardt, 2001. "Adjudication without Enforcement in GATT Disputes," Journal of Conflict Resolution, Peace Science Society (International), vol. 45(2), pages 174-195, April.
    • Handle: RePEc:sae:jocore:v:45:y:2001:i:2:p:174-195
    DOI: 10.1177/0022002701045002002
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    References listed on IDEAS

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    Cited by:

    1. Trofimov, Ivan D., 2017. "Political economy of trade protection and liberalization: in search of agency-based and holistic framework of policy change," MPRA Paper 79504, University Library of Munich, Germany.
    2. Jeheung Ryu & Randall W. Stone, 2018. "Plaintiffs by proxy: A firm-level approach to WTO dispute resolution," The Review of International Organizations, Springer, vol. 13(2), pages 273-308, June.
    3. Lee, Jiwon & Wittgenstein, Teresa, 2017. "Weak vs. Strong Ties: Explaining Early Settlement in WTO Disputes," ILE Working Paper Series 7, University of Hamburg, Institute of Law and Economics.

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