NATIONAL BUREAU OF ECONOMIC RESEARCH
NATIONAL BUREAU OF ECONOMIC RESEARCH
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Learning by Ruling and Trade Disputes

Giovanni Maggi, Robert W. Staiger

NBER Working Paper No. 23774
Issued in September 2017
NBER Program(s):International Trade and Investment Program

Over the WTO years, the frequency of disputes and court rulings has trended downwards. Such trends are sometimes interpreted as symptoms of a dispute resolution system in decline. In this paper we propose a theory that can explain these trends as a result of judicial learning; thus according to our theory such trends represent good news, not bad news. We then offer evidence that the predictions of our model are consistent with WTO trade dispute data, and we take a first step towards estimating the strength and scope of court learning.

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Document Object Identifier (DOI): 10.3386/w23774

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