The United States, the ITO, and the WTO: Exit Options, Agent Slack, and Presidential Leadership

A central issue facing the newly-created World Trade Organization is "the U.S. question." That is, to what extent will the United States abide by the spirit as well as the letter of the WTO's rules rather than going its own way de facto if not de jure? And what will shape the extent of U.S. compliance? In this paper we attempt to identify the distinctive features of the historical context that will shape the outcome. We do so by comparing the debate over the WTO with that surrounding the International Trade Organization. In analyzing the two episodes, we distinguish three stages in the process of reaching an international agreement: negotiation, ratification, and compliance. Our analysis of U.S. behavior in these stages emphasizes three factors: exit options (the value of the best alternative to ratifying an agreement), the slack between U.S. principals and their negotiating agents, and the presidential effort spent to build domestic support.

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Working or Discussion Paper
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JEL Codes:
Fl; O1
Series Statement:
Working Paper

 Record created 2017-04-01, last modified 2018-01-23

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