The Optimal Design of Trade Policy Flexibility in the WTO

This paper is a contribution to the literature on rational design of trade agreements. The World Trade Organization (WTO) is an incomplete contract among sovereign states. Incomplete contracts contain gaps. Ex post, contractual gaps may leave gains from trade unrealized; they may create 'regret' in signatories once unanticipated contingencies or sudden protectionist backlashes have occurred. Trade policy flexibility mechanisms, such as the 'safeguards clause' under Art. XIX GATT, are geared towards seizing ex post regret by allowing parties affected by a protectionist shock to partially and temporarily withdraw from previously made trade liberalization concessions - given that they compensate the victim(s) of such backtracking behavior. This paper examines the somewhat understudied issue of optimal trade policy flexibility design in the WTO: In particular, we analyze whether ex post escape should be organized by means of a unilateral opt-out clause (a 'liability rule' of escape), or a bilateral renegotiation provision (a 'property rule' of escape). Modeling the WTO as a fully non-contingent tariff liberalization contract with contingencies (or 'states of nature') asymmetrically revealed, we find that a liability rule backed by expectation remedies payable to the affected victim Pareto-dominates both a renegotiation clause, as well as any other remedy arrangement connected to a liability rule. Only the remedial design of liability-cum-expectation damages yields the desirable incentives to liberalize ex ante, and to default ex post and therewith is able to replicate the outcomes of the hypothetical contracting ideal of the complete contingent contract

A Meaningful U.S. Cap-and-Trade System to Address Climate Change

There is growing impetus for a domestic U.S. climate policy that can provide meaningful reductions in emissions of CO2 and other greenhouse gases. In this article, I propose and analyze a scientifically sound, economically rational, and politically feasible approach for the United States to reduce its contributions to the increase in atmospheric concentrations of greenhouse gases. The proposal features an up-stream, economy-wide CO2 cap-and-trade system which implements a gradual trajectory of emissions reductions over time, and includes mechanisms to reduce cost uncertainty. I compare the proposed system with frequently discussed alternatives. In addition, I describe common objections to a cap-and-trade approach to the problem, and provide responses to these objections

Stem and progenitor cells for liver repopulation: can we standardise the process from bench to bedside?

There has been recent progress in the isolation and characterisation of stem/progenitor cells that may differentiate towards the hepatic lineage. This has raised expectations that therapy of genetic or acquired liver disease might be possible by transplanting stem/progenitor cells or their liver-committed progeny. However, it is currently impossible to determine from the many documented studies which of the stem/progenitor cell populations are the best for therapy of a given disease. This is largely because of the great variability in methods used to characterise cells and their differentiation ability, variability in transplantation models and inconsistent methods to determine the effect of cell grafting in vivo. This manuscript represents a first proposal, created by a group of investigators ranging from basic biologists to clinical hepatologists. It aims to define standardised methods to assess stem/progenitor cells or their hepatic lineage-committed progeny that could be used for cell therapy in liver disease. Furthermore standardisation is suggested both for preclinical animal models to evaluate the ability of such cells to repopulate the liver functionally, and for the ongoing clinical trials using mature hepatocytes. Only when these measures have been put in place will the promise of stem/progenitor-derived hepatocyte-based therapies become reality.status: publishe

Patent Rights and Human Rights: Exploring their Relationships

The assessment of the relationship between patent rights and human rights has resulted in several tentative findings, such as by the UN Sub-Commission on the Promotion and Protection of Human Rights, that there are ‘‘apparent’’ or ‘‘actual or potential’’ conflicts. Also the World Intellectual Property Organization says that ‘‘conflicts may exist’’ between the two. This article, which is based on a Ph.D. dissertation on the right to food and the Agreement on Trade-Related Aspects of Intellectual Property Rights (TRIPS Agreement), analyzes the relationship between the two, based on an established understanding of conflict in international law, namely incompatible obligations. Also another level of conflict is introduced, namely conflict on the level of prescribed measures in one treaty which impedes the taking of measures prescribed by another treaty. Finally, the article assesses conflict on the level of impact. The findings are that strict legal conflict between the two is difficult to establish, but that there are serious concerns regarding their implementation. Developing states should make use of all the flexibilities that the TRIPS Agreement provides