forthcoming, Journal of International Economics Trade Disputes and the Implementation of Protection under the GATT: An Empirical Assessment

This paper is a first attempt to empirically determine why countries choose to violate or adhere to GATT rules when making trade policy adjustments between negoti-ating rounds. We use a previously unexploited set of data in which countries implemented two ‘types ’ of protection under the GATT system between 1973-1994: (i) ‘legal ’ protection in which countries utilized the GATT’s safeguards provisions, and (ii) ‘illegal ’ protection in which the protection was provided outside of the safeguards provisions, resulting in a formal trade dispute. We find substantial evidence that concerns for retaliation affect government policy decisions in ways which contribute to the explanation of the existence of trade disputes