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Stability and Rigidity: Politics and Design of the WTO's Dispute Settlement Procedure

Published online by Cambridge University Press:  02 September 2005

B. PETER ROSENDORFF
B. PETER ROSENDORFF
Affiliation:
University of Southern California
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Abstract

The increased “legalization” embodied in the revised Dispute Settlement Procedure (DSP) of the World Trade Organization (WTO) is shown to be an institutional innovation that increases the opportunities for states to temporarily suspend their obligations in periods of unexpected, but heightened, domestic political pressure for protection. This increased flexibility in the system reduces per-period cooperation among states but also reduces the possibility that the regime may break down entirely. There is shown to be a trade-off between rigidity and stability in international institutional design in the face of unforeseen, but occasionally intense, domestic political pressure. In a model with a WTO that serves both an informational and adjudicatory role, it is established that agreements with DSPs are self-enforcing, are more stable, and are more acceptable to a wider variety of countries than agreements without DSPs. Evidence drawn from data on preferential trading agreements supports the key hypotheses.

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ARTICLES
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American Political Science Review , Volume 99 , Issue 3 , August 2005 , pp. 389 - 400
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© 2005 by the American Political Science Association

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