On the effects of the design of international institutions: Judicialization and cooperation in the World Trade Organization

In the current multilateral trade regime, members often negotiate under the shadow of World Trade Organization (WTO) law. In this article, we develop a systematic explanation of how the legal vulnerability of members' domestic policies affects the prospects for cooperation in the trade regime. First, we show that contrary to conventional wisdom, increased enforcement does not necessarily make actors shy away from further cooperation. Legal vulnerability can ignite a positive dynamic of cooperation because it can increase the set of feasible agreements between WTO members. Subsequently, we examine how the nature of the issue at stake, that is, whether it can be easily disaggregated into negotiable units, crucially determines whether this positive dynamics of cooperation can take place. We illustrate the cogency of the argument by way of four in-depth case studies, which illustrate how potential (or actual) defendants and potential (or actual) complainants in WTO disputes responded to the incentives brought about by legal vulnerability and negotiated during the Doha round.