World Trade Organization Case Scenario
World Trade Organization Is the World Trade Organization still effective and relevant in today’s global political economy? Provide at least one argument for or against it’s continued relevance and support it with evidence. Write a 270 words response to Ana Nickless: Ana Nickless wrote: Although current WTO tariff reduction negotiations are hopelessly gridlocked and WTO regulations are filled with loopholes that still tend to benefit developed countries more than developing countries, I would argue that the organization is still relevant, primarily because the WTO is usually capable of settling trade disputes between members. Similarly, according to Cohn the WTO is also capable of “implementing and monitoring trade principles and rules”, or preventing member states from reneging on their trade agreements in the first place (p 232.) In contrast, Rodrik states that “the enforcement powers of the GATT were a joke,” which resulted in huge segments of the world economy being locked out of GATT trade agreements (p 73-74.) Although developing countries often benefit less than developed countries from WTO principals, rules, and court proceedings, I largely agree with Rodrik when he says “the problems that trade creates should be solved not by protectionism but through domestic policies that compensate the losers” (p. 88.) By implementing/monitoring trade rules and settling disputes, the WTO is providing a public good, without which we couldn’t dream of having nearly as much global free trade or reaping the enormous benefits of comparative advantage. Thus the WTO helps to prevent free riders, and if countries could figure out how to orient their domestic policies to compensate their internal “losers,” standards of living would hopefully rise worldwide, albeit at different rates. Since according to Cohn the three main functions of the WTO are 1. to implement/monitor trade rules, 2. settle disputes among members, and 3. conduct multilateral trade negotiations, and since the WTO is on balance only failing at #3, I would argue that it is indeed still relevant in today’s global political economy (p. 232.) References Cohn, Theodore H. (2016). Global Political Economy: Theory and Practice. New York, NY: Routledge. Rodrik, Dani. (2011). The Globalization Paradox: Democracy and the Future of the World Economy. New York, NY: W.W. Norton & Company.