Tariff retaliation versus financial compensation in the enforcement of international trade agreements

• 成果类型: Article
• 署名作者: Limao, Nuno; Saggi, Kamal
• 署名单位: National Bureau of Economic Research; Center for Economic & Policy Research (CEPR); University System of Maryland; University of Maryland College Park; Southern Methodist University
• 刊物名称: JOURNAL OF INTERNATIONAL ECONOMICS
• ISSN/ISSBN: 0022-1996
• DOI: 10.1016/j.jinteco.2008.03.005
• 发表日期: 2008
• 页码: 48-60
• 关键词: DISPUTE SETTLEMENT; WTO; TARIFFS; monetary fines; bonds; policy coordination

摘要

We analyze whether financial compensation is preferable to the WTO's current dispute settlement system that permits injured member countries to impose retaliatory tariffs. We show that, ex-post, monetary fines are more efficient than tariffs in terms of granting compensation to injured parties but fines suffer from an enforcement problem since they must be paid by the violating country. If fines must ultimately be supported by the threat of tariffs, they fail to yield a more cooperative outcome than the use of tariffs alone. Furthermore, the exchange of bonds between symmetric countries also does not improve enforcement relative to retaliatory tariffs. (C) 2008 Elsevier B.V. All rights reserved.