Power Plays and Capacity Constraints: The Selection of Defendants in World Trade Organization Disputes

By A. Guzman, Beth A. Simmons. The Journal of Legal Studies, 2005

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This paper examines the relationship between the wealth and power of states and their ability to participate fully within the World Trade Organization's system of dispute resolution. Two alternative hypotheses are considered. The power hypothesis predicts that politically weak countries will refrain from filing complaints against politically powerful states for fear of costly retaliation. The capacity hypothesis predicts that low‐income states will tend to complain about behavior by high‐income states because the latter offer a higher expected return. We test these two hypotheses and find considerable support for the capacity hypothesis and no support for the power hypothesis. We conclude that poor states behave differently than their rich counterparts because they lack the financial, human, and institutional capital to participate fully in the dispute resolution system.

Subfields: Development, Economics and Econometrics, Sociology and Political Science

View Paper: https://www.semanticscholar.org/paper/f373e3006ee87e800086fe09ac8bf3c8b3601e06

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Citations in the corpus

Who Files? Developing Country Participation in GATT/WTO Adjudication (2009, background): “Guzman and Simmons (2005) argue that poorer countries are more likely to target wealthy countries since there are more market gains from a victory if it increases access to a high value market.”
Competing for Capital: The Diffusion of Bilateral Investment Treaties, 1960–2000 (2004, background): “(See Table 1.)”