Reynolds, Kara MarieBown, Chad P.2015-05-042015-05-042015-04https://hdl.handle.net/10986/21856This paper examines the implications of the terms-of-trade theory for the determinants of outcomes arising under the enforcement provisions of international agreements. Like original trade agreement negotiations, the paper models formal trade dispute negotiations as potentially addressing the terms-of-trade externality problem that governments implement import protection above the globally efficient level so as to shift some of the policys costs to trading partners. The approach is to extend earlier theoretical models of trade agreement accession negotiations to the setting of enforcement negotiations in order to guide the empirical assessment. The paper uses instrumental variables to estimate the model on trade volume outcomes from World Trade Organization (WTO) disputes over 1995–2009. The evidence is consistent with theoretical predictions that larger import volume outcomes are associated with products that have smaller increases in foreign exporter-received prices (terms-of-trade losses for the importer) as a result of the dispute, larger pre-dispute import volumes, larger import demand elasticities, and smaller foreign export supply elasticities. Dispute settlement outcome differences are also explained by variation in institutionally-motivated measures of retaliation capacity and the severity of the free-rider problem associated with foreign exporter concentration.en-USCC BY 3.0 IGOSETTLEMENT NEGOTIATIONSTRADE VOLUMESEXPORT SUPPLYURUGUAY ROUNDLIABILITYPANEL REPORTTRADE LOSSESWORLD TRADE ORGANIZATIONINTERNATIONAL ECONOMIC LAWAD VALOREMDISPUTE SETTLEMENTINCOMEINTERESTEXPECTATIONSIMPORTING COUNTRIESTRADE BARRIERSCOUNTERVAILING DUTIESINTERNATIONAL TRADING SYSTEMREAL GDPINTERNATIONAL ORGANIZATIONSCHANGES IN TRADEDISPUTE SETTLEMENT PROCEDURESGDP PER CAPITAEXPORTSNATIONAL TREATMENTELASTICITYGLOBAL” POLICIESTRADE FLOWSECONOMETRIC ESTIMATESPOLITICAL ECONOMYEXPORTERSEXPORT PRICESDEMAND ELASTICITIESECONOMIC RELATIONSWELFAREINCENTIVESEQUILIBRIUMTRADE NEGOTIATORSVARIABLESIMPORTED PRODUCTSPANEL REPORTSDISPUTE SETTLEMENT SYSTEMMARKET ACCESSINTERNATIONAL BANKEXPORT SUBSIDIESDISPUTE RESOLUTIONTRADE AGREEMENTSEXPORTING COUNTRYIMPORT PRODUCTSOIL PRICESABSOLUTE VALUECONSUMER SURPLUSREGIONAL TRADECASE LAWVALUE OF IMPORTSANTIDUMPINGIMPORT POLICYEXTERNALITIESIMPORT PROTECTIONFREE RIDER PROBLEMWTOIMPORT RESTRICTIONSWORLD PRICESTRADE DISPUTESACCESSECONOMICS LITERATUREFREE RIDERTRADE POLICYDISPUTE SETTLEMENT RULESTRADE AGREEMENTAVERAGE TRADETRADE PREFERENCETRADE MOTIVESTRADE EXTERNALITIESLEGAL ASPECTSEXTERNALITYIMPORT MARKETSDISPUTE RESOLUTION PROCESSECONOMIC OUTCOMESINTERNATIONAL TRADEECONOMETRIC ANALYSISEXPORTING COUNTRIESVALUEDEMAND SHOCKSCONCESSIONSDEMANDTRADE PROTECTIONEXPORT SHARESMEASUREMENTFOREIGN EXPORTERSMANAGED TRADEBENCHMARKINTERNATIONAL AGREEMENTSECONOMIC THEORYTRADE LIBERALIZATIONSETTLEMENT OF DISPUTESENDOGENOUS VARIABLESECONOMICSECONOMIC MODELSWORLD TRADING SYSTEMTERMS OF TRADERECIPROCITYECONOMIC LAWDOMESTIC DEMANDAPPELLATE BODY REPORTTRADE DATAIMPORTING COUNTRYEXPORT POLICYTRADEAPPLICATION OF RECIPROCITYGDPDOMESTIC PRICESGOODSTHEORYTRADING SYSTEMLEGAL SYSTEMBILATERAL TRADETRADE RESTRICTIONAPPELLATE BODYECONOMIC DISTORTIONSSUPPLYRETALIATION LEVELSPRODUCT MARKETSTRADE DISPUTEIMPORT POLICIESINTERNATIONAL LAWLEGAL PROCEDURESBILATERAL TRADE DATAPOLICY RESEARCHARBITRAGEOUTCOMESIMPORT VALUEDISPUTE SETTLEMENT PROCESSPRICESARBITRATORDEVELOPMENT POLICYFUTURE RESEARCHWorking PaperWorld Bank10.1596/1813-9450-7242