Suchergebnisse

A major contributor to the crisis at the World Trade Organization is the decline in support for multilateralism in the United States. Three key problems with the organization's design precipitated the decline. First, incomplete rules related to trade remedies are interpreted by the organization's Appellate Body in ways that conflict with a narrow set of sensitive US domestic priorities. Second, existing organization rules do not sufficiently account for non-market economies, such as China. Third, remediation of these problems is infeasible due to consensus-based decision-making in the World Trade Organization. These problems represent more fundamental challenges induced by increased economic integration—loss of sovereignty and erosion of democracy. To alleviate these problems in multilateral agreements we suggest: (1) a narrow solution that carves out a special process for handling trade remedy disputes; (2) a broad solution that relaxes the requirement of consensus for the organization's reform, adopting some form of supermajority voting or a sunset clause; (3) the reform of domestic consensus-building institutions within the US that directly address the political-economy sources of voter discontent.

When do voters win? We derive conditions under which a democracy will produce policies that favor the voter over special interests in a setting where politicians can be influenced by contributions from special interests, and are also motivated by electoral incentives. We show that increasing office holding benefits, increasing political competition, decreasing potential rents to special interests, and increasing the salience of policy imply improved policies for the representative voter. We examine panel data on the ratio of taxes paid by individuals relative to corporations in the United States and show that it is negatively correlated with political competition, office holding benefits, and policy salience, as predicted by the model.