Suspiciously Timed Trade Disputes, Institute for Advanced Studies (Austria)

Jan 26, 2017, 16:00 – 18:25, University of Vienna, Oskar-Morgenstern-Platz 1, 1090 Vienna (Skylounge, 12th floor)

Georg Kirchsteiger (Free University Bruxelles)

This paper shows that electoral incentives crucially affect the initiation of trade disputes. Focusing on WTO disputes filed by the United States during the 1995-2014 period, we find that U.S. presidents are more likely to initiate a dispute in the year preceding their re-election. Moreover, U.S. trade disputes are more likely to involve industries that are important in swing states. To explain these regularities, we develop a theoretical model in which re-election motives can lead an incumbent politician to file trade disputes to appeal to voters motivated by reciprocity.


Botond Köszegi (Central European University Budapest) will also hold a conference on the same occasion (Title tba)