Dispute and the odds

. . . is the topic of my Trade Tripper column in this Friday-Saturday issue of BusinessWorld. Excerpts:

"Thus, it would be interesting to see what inputs game theory could provide on the probable outcome of the said cases. This is because, while normally one would think that the moment a dispute comes before a panel then chances are 50-50 for either party. This apparently is not so, according to the 2002 findings of Andrew Guzman of the University of California, Berkeley, in his paper 'The Political Economy of Litigation and Settlement at the WTO.' He found that complainant countries (or countries that complain against other countries’ trade barriers) in WTO disputes have almost a 90% chance of winning. These findings were corroborated in A Theory of WTO Adjudication by Juscelino Colares of Syracuse University, which made use of empirical analysis of WTO adjudication from 1995 through 2007, revealing again a high disparity between complainant and respondent countries’ success rates: Complainants do win 90% of the time. This rather unfortunate statistic is obviously well above the 'win rate' of any domestic legal system (or any other international dispute system for that matter).

Which perhaps underlines another important thing: international trade disputes are really no places for domestic industries involved to engage in flaky thinking or grandstanding."