Testing international trade law: Empirical studies of GATT/WTO dispute settlement

Abstract

Law did play an important role in this lawyerless multilateral trade order, but which one? Roessler (1999, 10) Introduction Dispute settlement under the General Agreement on Tariffs and Trade (GATT) and its successor, the World Trade Organization (WTO), is the very “backbone of the multilateral trading system” (Moore 2000). Indeed, despite being likened to a “court with no bailiff” (Rossmiller 1994, 263), the GATT/WTO system is widely touted as the most successful of any comparable institution today (Hudec 1993, 353; Petersmann 1997, 63–65; Moore 2000). Add to this that the WTO's Dispute Settlement Understanding (DSU) has corrected many of the shortcomings of GATT 1947, and it is little wonder that most observers are even more optimistic about the future. Until recently, however, there has been virtually no empirical evidence brought to bear on the most important questions in the field. Why do countries take some of their complaints to GATT/WTO and prosecute others unilaterally, “out of court”? Why are some disputes settled with liberalization by the defendant, while the status quo prevails in others? And has greater legalization of the system made dispute settlement more efficacious? Taking Robert Hudec's Enforcing International Trade Law as its point of departure, a growing literature has begun to tackle these and related questions, testing hypotheses against data on the hundreds of complaints filed since 1948. Some of the results confirm prevailing views about the political economy of GATT/WTO dispute settlement.

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