Date of Award

Spring 5-2-2016

Level of Access Assigned by Author

Open-Access Thesis

Degree Name

Master of Arts (MA)

Department

Global Policy

Advisor

Kristin Vekasi

Second Committee Member

James H. Breece

Third Committee Member

Patrick Downey

Abstract

This thesis analyzes Japan’s decision to use Dispute Settlement Mechanisms (DSMs) in trade agreements. International trade rules are effective when properly applied: they prevent abrogation of the obligations that come with membership in international economic organizations. The DSMs are important ways to enforce the international trade commitments agreed upon by signatory countries. To date, member countries have filed more than 500 cases through the World Trade Organization (WTO), effectively enforcing the rules of the largest multilateral trade organization. On the other hand, in Japan's regional trade agreements (RTAs), none of the DSMs have ever been invoked despite the presence of many potential disputes. This paper first looks through the previous literature related to the use/non-use of DSMs. After that it introduces originally collected data on Japan’s DSMs in trade agreements and analyzes which variables affect Japan’s decision to initiate a formal dispute settlement process in the World Trade Organization. It finds that the amount of export, the degree of democracy, and sectoral characteristics positively affect Japan’s decision of using a DSM. On the other hand, Japan’s decision to use or join a DSM is negatively affected by RTA with a disputing country, Southeast Asian category, the number of use times when Japan used DSMs with that disputing country, and even the disputing country’s Gross Domestic Product (GDP) per capita. The results of analysis implies that the Japan is concerned that using a DSM may worsen the relations with a disputing country. I suggest multilateral DSM would be a better option to mitigate Japan’s concerns about using a DSM in its RTAs.

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