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- W2124133079 abstract "Abstract This paper explores the limits of international trade cooperation in the presence of a dispute settlement procedure. The dispute settlement procedure is modeled as set of conditions imposed on the punishment equilibria of a repeated tariff game, conditions that are consistent with the WTO principles of conciliation and reciprocity. The resulting equilibria are “renegotiation-proof” in the sense of Pearce [Renegotiation-proof equilibria: collective rationality and intertemporal cooperation. Yale Cowles Foundation Discussion Paper: 855, Yale University, 1987]. We find that tariff agreements cannot achieve free trade in the presence of the dispute settlement procedure, although the cost of this limitation becomes small for high discount factors. Quota agreements can achieve free trade under the dispute settlement procedure; however, countries would always prefer to settle disputes with tariff sanctions, if given a choice. These results are related to recent dispute settlement reforms." @default.
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- W2124133079 date "2001-06-01" @default.
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- W2124133079 title "Optimal international trade agreements and dispute settlement procedures" @default.
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- W2124133079 doi "https://doi.org/10.1016/s0176-2680(01)00031-3" @default.
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