Brown Bag Seminar with Krzysztof Pelc, Oxford University

Can International Institutions Bypass Spoiler Members? The Case of the Trade Regime and the MPIA

Abstract

In response to the impasse caused by the US’ blockade of the World Trade Organization’s dispute settlement body, 52 Member-states have devised a voluntary, binding judicial workaround. The Multi-Party Interim Appeal Arbitration Arrangement (MPIA) is a singular yet overlooked innovation in global governance. This article asks two questions: first, what determines who joins a novel enforcement mechanism in the midst of a global “backlash” against trade liberalization? Secondly, does the MPIA work? Examining countries’ trade policy in the run-up to the MPIA’s creation suggests that the main motivation for MPIA participation is the possibility to challenge trade partners’ measures; vulnerability to others’ challenges, conversely, does not deter joining. The same analysis can be used to predict subsequent MPIA entrants, in ways that accord with anecdotal evidence. A corollary finding is that insofar as the US reasons similarly to other countries, its trade profile suggests it does not stand to gain much from more credible enforcement, in ways that challenge the conventional wisdom from hegemonic stability theory. Secondly, it may seem early to measure the effectiveness of a nascent tribunal, yet no successful enforcement mechanism can wait until the ruling stage to exert its primary impact. Looking at dyadic trade measures over time, we show evidence that the MPIA generates deterrence, and that this effect is growing. From an institutional standpoint, the experiment appears to be working: the MPIA is not only an interim solution, but also a prototype for institutional innovation in the face of hegemonic spoilers.

About the speaker

Krzysztof Pelc is Lester B. Pearson Professor of International Relations at Oxford University, a member of the DPIR, and a Professorial Fellow at St-Anne's College. 

His research examines the international political economy. He is especially interested in how the design of rules can affect the odds of cooperation between states, and how some rules benefit some countries over others. This has led him to write about participation in international institutions, privacy and publicity, the effects of (il)legitimacy on political outcomes, optimal ambiguity, the impact of hard times on cooperation, precedent in public international law, whether workers can be compensated for losses from globalization, and the circumstances under which governments are allowed to break formal rules.

The unifying theme of this work is the idea of credibility. Being believed is the most valuable asset in both political and commercial markets. So how do market actors and political leaders get others to believe they are reliable types when unreliable types abound? 

Prof Pelc received his PhD from Georgetown University and spent his postdoc at Princeton's Niehaus Center. He then taught at McGill University for over a decade. Prof Pelc has been a visiting professor at NYU, the Jawaharlal Nehru Institute of Advanced Studies in New Delhi, and the University of Copenhagen. He was awarded the 2017 McGill's Faculty of Arts Award for Distinction in Research. 

Prof Pelc's most recent book is "Beyond Self-Interest: Why the Market Rewards Those Who Reject It", with Oxford Press and Bloomsbury in which he argues that the true idols of market society are those who deny their self-interest or appear to do so. Trouble ensues. See the review in the Financial Times. Read the review in the Toronto Star. 

Prof Pelc was the winner of the Financial Times 2021 Essay Prize on the occasion of the Political Economy Club's bicentenary. He occasionally writes fiction and was the 2019 winner of Canada's CBC Short Story Prize.

We strongly encourage you to attend this event on-site. In case you cannot be present in person, please register here to attend online (via Zoom): https://us06web.zoom.us/meeting/register/tZMof-CoqzkrG91-q8cm9sY6GdeO6g6FtZXz