Christina Davis (Harvard University), “Shaping Trade Stability: WTO Rulings on Export Restrictions and Business Confidence in Supply Chains”

US ET: April 9 (Thursday), 8 – 9 PM

JST: April 10 (Friday), 9 – 10 AM

Zoom Registration: Link

Paper TBA.

Authors: Christina Davis (Harvard University), Jialu Li (independent researcher), and Sayumi Miyano (Osaka University)

Presenter: Christina Davis (Harvard University)

Abstract:
An effective international legal system resolves disputes and deters violations. Once the strongest area of international law, the WTO has been weakened by internal conflicts, trade wars, and supply chain disruptions. This paper examines whether WTO rulings still bolster confidence in the rules-based trade order, focusing on business perceptions of supply chain stability. Using a 2022 survey experiment of Japanese firm managers, we assess how WTO rulings shape expectations about trade reliability. Respondents were randomly assigned to receive varying information regarding a WTO ruling that found China’s export restrictions on raw materials violated WTO rules, modeled on an actual case. We analyze how legal rulings and policy changes affect confidence in securing input supplies and compare perceptions of China’s supply chains versus other countries. Results show that learning about a WTO ruling against China lowers confidence in China’s supply chain reliability. However, further learning about China’s compliance with the ruling significantly restores confidence—more than similar policy changes without multilateral enforcement. These findings suggest that while highlighting violations may weaken trust, compliance strengthens confidence in global trade stability.

Discussants: Gregory Shaffer (Georgetown University Law Center), Iain Osgood (University of Michigan)

Chair TBA