POLI 359 Lecture Notes - Lecture 1: World Trade Organization, De Jure, Bermeo

• School: McGill University
• Department: Political Science
• Course: POLI 359
• Professor: Leonardo Baccini

Document Summary

Part 2: the wto: effectiveness and dsm. Basic principles - ex: cut tariffs with one state must cut all others. Decision-making process - can still be biased in favour of powerful countries through batna. Doha round - countries are struggling to agree on even stricter provisions on trade related issues. Let"s now move to the effectiveness of the gatt/wto. To estimate the impact of the gatt/wto on trade flows we need an appropriate tool. Gravtiy model (tinbergen, 1962) use to gravitiy model. Workhorse in a number of empirical trade studies. Bilateral trade is directly proportional to economic size of two countries and indirectly propotional to the distance between them. Standard control variables: adjacency common language colonial links common currency island, landlocked institutions, infrastructure, migration flows . Rose (2004) finds no empirical evidence that gatt/wto increases trade. De jure members: members of the wto, applied and accepted. However here is where informal governance comes to play a role.