infonet-economy

This paper reviews the economic interventions by governments and central banks in response to the 2007-2009 financial and economic crisis.

In the area of trade policy, we find that protectionism has increased substantially, with governments targeting in particular the products of declining industries and financial services. Nevertheless, spiralling protectionism as in the 1930s has so far been avoided. In investment policy, the crisis has not led to a general increase of protectionist pressures for the time being, although the long-term general trend towards liberalisation has recently been complemented by a parallel trend towards re-regulation. The main areas of economic interventionism, however, have been fiscal policy (mainly through stimulus programs and emergency actions to stabilise the financial system) and monetary policy (mainly through interest rate cuts, quantitative easing and various other actions).

Given their cumulative size, these interventions hold a substantial potential for distortions and undesirable side-effects on both the microeconomic and the macroeconomic levels. These include protectionism, political mismanagement and state failure, the degradation of government finances and the threat of future inflation. These concerns can be addressed, but this requires constant monitoring of the policy areas affected and decisive actions towards achieving a timely exit.

Journal of Economic Literature (JEL) Classification Codes: E52 (Monetary policy), E58 (Central banks and their policies), E62 (Fiscal policy), E63 (Comparative or joint analysis of fiscal and monetary policy; stabilization), F13 (Trade policy; international trade organizations); F21 (International investment; long-term capital movements).

On 1 January 1995, the Understanding on Rules and Procedures
Governing the Settlement of Disputes (Dispute Settlement
Understanding; DSU) entered into force. Since 1998, negotiations to
review and reform the DSU have taken place ("DSU review"), however without yielding any result so far.

The DSU review exercise has only attracted limited academic interest so far. This lack of interest in Members' proposals and negotiations is rather astonishing, particularly if judged in the light of the general explosion of literature on the World Trade Organisation (WTO),
including on its dispute settlement system. Whereas even single
adjudicating decisions such as the rulings in the Shrimp/Turtle or the
Bananas Cases have each become the subject of countless contributions, the efforts of the entire WTO community to make the DSU evolve further have long been neglected. Only recently, a certain academic interest in these negotiations and in the submitted proposals can be noticed.
The over-emphasis of the DSU literature on rulings and recommendations, and the parallel lack of interest in the political discussions on the DSU, is questionable from both an analytical and a practical perspective. From the analytical point of view, it creates a general perception in which the role of the adjudicating bodies tends to be chronically overstated and where the intergovernmental, member driven character of the Organisation is largely overlooked. Practically, such a distorted assessment may lead to policy recommendations or actions which are out of tune with political realities and which may undermine the sustainability of the system.

The DSU review negotiations, albeit unsuccessful so far, have brought forth a variety of proposals in the last seven years. These submissions are supposed to contribute to improvements and clarifications of the mechanism. Not only is the DSU review of interest in its own right, but it also offers a reflection of the experience that WTO Members have gathered in ten years of dispute settlement practice. In doing so, the discussions are revealing with regard to the general degree of satisfaction of Members with the system. They can also serve as an indicator for problems or tensions in the mechanism and for changes in the position of certain Members in and towards the system. Finally, the DSU review discussions assist us in establishing some hypotheses on the future evolution of the WTO dispute settlement mechanism.

This chapter seeks to contribute to the DSU literature by retracing the negotiating process in its context and by analysing the main reasons why the negotiations have failed so far. Part 2 analyses the negotiations that have taken place between 1997 and 2004. In Part 3, the reasons for the failure to bring the negotiations to a successful conclusion so far will be discussed, based on a brief presentation of major proposals. Part 4 presents some elements of a "DSU Review in practice", i.e. practical steps that Members and adjudicating bodies have undertaken to adapt DSU practice to changing circumstances and requirements without modifying the text of the DSU. Part 5 concludes.

Artikel / Articulo: "Aumento del 17% en exportaciones a México" (91 KB) Interview von / Entrevista de Patricia Islas Züttel mit / con Peter Riesterer, Thomas A. Zimmermann, Vicente Fox Quesada, Marta Sahagún de Fox; Technik / servicio tecnico: Werner Christen (mp3) (6.36 MB)

In den letzten Jahren haben sich die aussenwirtschaftspolitischen Parameter der USA teilweise stark geändert. Drei augenfällige Trends bestimmen seither die US-amerikanische Aussenwirtschaftspolitik: Erstens fliessen Sicherheitsüberlegungen seit den Terroranschlägen vom 11.September 2001 massiv in aussenwirtschaftliche Regelungen ein; zweitens schenken die USA der regionalen und bilateralen Ebene bei der Aushandlung internationaler Wirtschaftsabkommen eine gegenüber früher stärkere Beachtung; und drittens scheint die US-amerikanische Aussenwirtschaftspolitik unter zunehmenden protektionistischen Druck zu geraten. Die neuen Entwicklungen erfordern adäquate Antworten seitens der Haupthandelspartner. Volltext (deutsch), 275 KB

Au cours des dernières années, certains paramètres qui soustendaient la politique économique extérieure des États-Unis ont subi de profonds changements. Les considérations sécuritaires ont, d'abord, été intégrées au cadre réglementaire de l 'économie extérieure, depuis les attentats terroristes du 11 septembre 2001. Les États-Unis affichent, ensuite, un intérêt plus marqué qu'auparavant pour la négociation d'accords commerciaux à l'échelon régional et bilatéral. Enfin, la pression protectionniste sur la politique économique extérieure des États-Unis semble augmenter. Ces évolutions récentes appellent des réponses adéquates de la part des principaux partenaires commerciaux. Volltext (fanzösisch) / Texte complet (français), 275 KB/KO

This presentation reviews the economic interventions by governments and central banks in response to the 2007-2009 financial and economic crisis.

In the area of trade policy, we find that protectionism has increased substantially, with governments targeting in particular the products of declining industries and financial services. Nevertheless, spiralling protectionism as in the 1930s has so far been avoided. In investment policy, the crisis has not led to a general increase of protectionist pressures for the time being, although the long-term general trend towards liberalisation has recently been complemented by a parallel trend towards re-regulation.

The main areas of economic interventionism, however, have been fiscal policy (mainly through stimulus programs and emergency actions to stabilise the financial system) and monetary policy (mainly through interest rate cuts, quantitative easing and various other actions).

Given their cumulative size, these interventions hold a substantial potential for distortions and undesirable side-effects on both the microeconomic and the macroeconomic levels. These include protectionism, political mismanagement and state failure, the degradation of government finances, massive tax increases, and the threat of future inflation.These concerns can be addressed, but this requires constant monitoring of the policy areas affected and decisive actions towards achieving a timely exit.

Journal of Economic Literature (JEL) Classification Codes: E52 (Monetary policy), E58 (Central banks and their policies), E62 (Fiscal policy), E63 (Comparative or joint analysis of fiscal and monetary policy; stabilization), F13 (Trade policy; international trade organizations); F21 (International investment; long-term capital movements).

For discussion during the International Workshop on "Competition, Cultural Variety and Global Governance; The Case of the Global Audio-Visual System", ####

Papier auf einem interdisziplinären Doktorandenseminar zu Fragen der WTO, Tübingen, Juli 2001, unter der wissenschaftlichen Leitung von Prof. Dr. Kokott, Prof. Dr. Hauser und Prof. Dr. Martin Nettesheim #### (pdf, 143k)