World Trade Organization Research

“

The WTO was established to promote global business by encouraging multilateral trade liberalization (Bagwell & Staiger, 2004). The multilateral trading system is supported by the well-known economic rationale of free trade: efficiency gains for consumers. To achieve this goal, the design and operation of the WTO are guided by three main principles: (i) nondiscrimination (most-favoured-nation), (ii) reciprocity (balancing concessions on tariffs), and (iii) nullification (countermeasures). These rules constrain the use of trade-restrictive policies by national governments. In this way, WTO-led globalization seeks to harness this gain of free trade (Bagwell & Staiger, 1999). These principles do make economic sense, as the WTO promotes global trade (Rose, 2004). However, the welfare arguments lend support to a critique of the WTO's present structure for the uneven distribution of gains from free trade between developed and developing member countries (Subramanian & Wei, 2007). Even so, the WTO rule system provides space for the formation of regional trade agreements (RTAs). The WTO's inability to effectively promote and govern free and fair trade has led to the proliferation of plurilateral RTAs (Hartman, 2013). However, the RTAs also constrain member countries choices of change in monetary and fiscal policies to address cases of market failure (Bown, 2017). The WTO member countries failure to reach consensus on imperative issues of agriculture, food security, fishery subsidies, electronic-commerce and environmental sustainability has slowed the pace of multilateral trade liberalization. At the same time, DSB remained crucial to international trade dispute settlement due to its exclusive and compulsory jurisdiction (Davey, 2022).

”