TY  - JOUR
AU  - Bagwell,Kyle
AU  - Staiger,Robert W.
TI  - What Do Trade Negotiators Negotiate About? Empirical Evidence from the World Trade Organization
JF  - National Bureau of Economic Research Working Paper Series
VL  - No. 12727
PY  - 2006
Y2  - December 2006
UR  - http://www.nber.org/papers/w12727
L1  - http://www.nber.org/papers/w12727.pdf
N1  - Author contact info:
Kyle Bagwell
Department of Economics
Stanford University
Landau Economics Building
579 Serra Mall
Stanford, CA 94305-6072
Tel: (650) 723-3251
E-Mail: kbagwell@stanford.edu

Robert W. Staiger
Department of Economics
Stanford University
Landau Economics Building
579 Serra Mall
Stanford, CA  94305-6072
Tel: 650/723-0533
Fax: 650/725-5702
E-Mail: rstaiger@stanford.edu
AB  - What do trade negotiators negotiate about?  There are two distinct theoretical approaches in the economics literature that offer an answer to this question: the terms-of-trade theory and the commitment theory.  The terms-of-trade theory holds that trade agreements are useful to governments as a means of helping them escape from a terms-of-trade-driven Prisoners' Dilemma.  The commitment theory holds that trade agreements are useful to governments as a means of helping them make commitments to the private sector. These theories are not mutually exclusive, but there is little direct evidence on the empirical relevance of either.  We attempt to investigate empirically the purpose served by market access commitments negotiated in the World Trade Organization. We find broad support for the terms-of-trade theory in the data. We claim more tentatively to find support in the data for the commitment theory as well.
ER  -