Detecting Looming Vetoes: Getting the European Parliament’s Consent in Trade Agreements

Since the implementation of the Lisbon Treaty, the European Parliament wields the power of consent over international (trade) agreements, enabling it to threaten a veto. Due to the extensive financial and reputational costs associated with a veto, the European Commission (hereinafter Commission) was expected to read these threats effectively. However, the Commission’s responses to such threats have varied greatly. Building on a fine-grained causal mechanism derived from information processing theory and an extensive process-tracing analysis of seven free trade agreements post-Lisbon, we explain why the Commission has responded differently to looming vetoes. Our analysis reveals that the variation in Commission responses derives from imperfections in its information-processing system, the ‘early-warning system,’ which had to be adapted to the new institutional equilibrium post-Lisbon. Because of this adaption process, factors exogenous to the parliamentary context (‘externalities’) as well as internal uncertainties (‘internalities’) add constant unpredictability to the Commission’s reading of the European Parliament.

Forest Biosecurity in Canada – An Integrated Multi-Agency Approach

In Canada, forest biosecurity is primarily under federal jurisdiction as the federal government is the signatory to the International Plant Protection Convention and other international trade agreements. The Canadian Food Inspection Agency (CFIA), which is Canada’s National Plant Protection Organization, has the mandate of analyzing risks, setting policy, and managing incursion responses related to forest biosecurity. Other federal government agencies play important roles; the Canada Border Services Agency (CBSA) enforces regulations at international ports of entry and the Canadian Forest Service of Natural Resources Canada conducts research and analysis in support of the development and implementation of phytosanitary regulations. The provinces and territories also manage invasive species through implementing regulations to prevent the spread of established forest pests. This paper outlines the regulatory framework for forest biosecurity within Canada, and provides case studies of species that have invaded Canadian forests or are anticipated to do so in the near future.

SPAIN AS AN ATTRACTIVE PLACE FOR FOREIGN INVESTMENT

The aim of this paper is to examine the Spanish economy, identify key areas for investment and assess the risks and opportunities associated with this. The article examines all aspects related to determining the degree of investment attractiveness of Spain, as well as the current state of the Spanish investment environment and the latest trends in the Spanish investment sector. Other objectives of this study include examining the Spanish economy, identifying key areas for investment and current trends in potential investment. An analysis of the threats and opportunities associated with investing in Spain was also conducted. Various resources have been used to provide reliable, up-to-date, in-depth, detailed and comprehensive analysis. First, the world’s leading databases, such as the World Bank, the International Monetary Fund, UNCTAD, and so on. Second, data from Spanish government and financial institutions were taken into account. In order to study the problem from different angles, the media, scientific papers and journals were also involved in gathering the necessary information. The analysis allowed us to identify the most significant advantages of the Spanish economy as an object of investment, in particular: – highly developed service sectors, such as financial and insurance services, telecommunications, D&R, etc., which are constantly fueled by FDI inflows; – strategic location and opportunity to enter the EU market; – successful internal structural reforms have been implemented, which have led to increased labor flexibility; – favorable conditions for immigration (including labor immigration); – leading positions in terms of solvency and trust; – economic openness of the country and its participation in a large number of international trade agreements; – measures taken to weaken business and investment regulation; – non-interference of the state in business, fair competition and not perverted trade; – excellent infrastructure that stimulates economic growth; – one of the most innovative and efficient tax agencies – AEAT; – absence of other significant socio-economic, legal and criminal risks that hinder investment. Although Spain faces high unemployment, the current economic crisis caused by the Crown virus, and huge public debt, most of them can be turned into the benefits of foreign investment projects. Similarly, to overcome the economic crisis, the country needs an influx of money from outside, so now the conditions for foreign investors are even more favorable

International trade agreements and bargaining

In this dissertation, I provide a compelling explanation about why the World Trade Organization (WTO) permits retaliation only after a lengthy delay. I then explain why it usually rejects requests for retaliation (or a reciprocal withdrawal of concessions) in other related inter- national agreements. Next, I consider a more general problem about agents negotiating over an allocation of some surplus. This multilateral bargaining model could be applied to international trade or many real-world negotiations. I begin by taking a dynamic mechanism design approach and analyze the welfare effects among same-sector retaliation with and without delay as well as cross-sector retaliation with and without delay. I show that a retaliation with delay mechanism generates higher welfare and supports a higher self-enforcing level of cooperation than does a retaliation without delay mechanism. I demonstrate that under certain conditions, a same-sector retaliation mechanism generates higher welfare and supports a higher self-enforcing level of cooperation than does a cross-sector retaliation mechanism. All the above results are showing to hold for several different stochastic process of how a state of the world evolves. I then consider a more general case of bargaining where the size of the surplus is endogenized. In my model of the first two chapters after the introduction, although the size of the surplus varies across time, it still evolves in a stochastic manner. In many real-world negotiations, however, a surplus is usually created by players and each player may have certain power to influence a recognition process. Hence, my main innovation in the last chapter is to allow a surplus as well as recognition probabilities to be endogenously determined by players' actions. I assume that players' actions can have either persistent or transitory effects on a bargaining process. I compare the equilibrium outcomes under different voting rules and show that when a competition becomes less intensive (i.e., a proposal needs the consents of more players), it raises social welfare while it makes a free-ride problem more severe.

International trade agreements and bargaining

In this dissertation, I provide a compelling explanation about why the World Trade Organization (WTO) permits retaliation only after a lengthy delay. I then explain why it usually rejects requests for retaliation (or a reciprocal withdrawal of concessions) in other related inter- national agreements. Next, I consider a more general problem about agents negotiating over an allocation of some surplus. This multilateral bargaining model could be applied to international trade or many real-world negotiations. I begin by taking a dynamic mechanism design approach and analyze the welfare effects among same-sector retaliation with and without delay as well as cross-sector retaliation with and without delay. I show that a retaliation with delay mechanism generates higher welfare and supports a higher self-enforcing level of cooperation than does a retaliation without delay mechanism. I demonstrate that under certain conditions, a same-sector retaliation mechanism generates higher welfare and supports a higher self-enforcing level of cooperation than does a cross-sector retaliation mechanism. All the above results are showing to hold for several different stochastic process of how a state of the world evolves. I then consider a more general case of bargaining where the size of the surplus is endogenized. In my model of the first two chapters after the introduction, although the size of the surplus varies across time, it still evolves in a stochastic manner. In many real-world negotiations, however, a surplus is usually created by players and each player may have certain power to influence a recognition process. Hence, my main innovation in the last chapter is to allow a surplus as well as recognition probabilities to be endogenously determined by players' actions. I assume that players' actions can have either persistent or transitory effects on a bargaining process. I compare the equilibrium outcomes under different voting rules and show that when a competition becomes less intensive (i.e., a proposal needs the consents of more players), it raises social welfare while it makes a free-ride problem more severe.

Essays on the Incentives to Form International Agreements between Asymmetric Countries

International Environmental Agreements suffer from a strong free-riding incentive that generally leads to failure of coalition formation in the economics literature and have been largely unsuccessful in practice. At the same time, preferential trade agreements (PTAs) have increasingly included elements not specifically related to trade, such as domestic policy over the environment, labour, intellectual property, health and investment. One area that has received a great deal of attention is deep agreements is the environment. In this dissertation, we develop three models of asymmetric countries, that include both trade and environmental externalities and study the incentives to form international trade agreements between those asymmetric countries. First, we develop a two-country, two-good model with cross-border negative spillovers and perfect competition in product markets. We compare shallow (trade only) and deep (trade and environment) trade agreements between those two large asymmetric countries, and we show that deep and shallow trade agreements have different outcomes in terms of world and individual countries welfares, trade specialization and environmental damages. Next, we develop two three-country, three-goods models, a “competing importers model” and a “competing exporters model”, and examine equilibrium agreements and environmental outcomes assuming (i) environmental agreements are negotiated separately, (ii) trade agreements are shallow, and (iii) trade agreements are deep. To examine the stability of endogenous deep and shallow trade agreements we set up various three stage games and use coalition-proof Nash equilibria refinement to circumvent the multiplicity of Nash equilibria. Furthermore, in order to examine the differences between shallow and deep trade agreements, we develop extended games where countries can choose between different deep and shallow PTAs and investigate how equilibrium agreements differ based on being deep or shallow. Therefore, in two different models of multiple asymmetric countries, we ask and answer the following questions: (i) how do equilibrium agreements differ when countries choose deep rather than shallow agreements?; (ii) given the choice between deep and shallow trade agreements, would countries prefer to incorporate an environmental clause into their equilibrium trade deal?; and (iii) what are the implications of including non-trade elements in PTAs for the pursuit of global free trade?

Essays on the Incentives to Form International Agreements between Asymmetric Countries

International Environmental Agreements suffer from a strong free-riding incentive that generally leads to failure of coalition formation in the economics literature and have been largely unsuccessful in practice. At the same time, preferential trade agreements (PTAs) have increasingly included elements not specifically related to trade, such as domestic policy over the environment, labour, intellectual property, health and investment. One area that has received a great deal of attention is deep agreements is the environment. In this dissertation, we develop three models of asymmetric countries, that include both trade and environmental externalities and study the incentives to form international trade agreements between those asymmetric countries. First, we develop a two-country, two-good model with cross-border negative spillovers and perfect competition in product markets. We compare shallow (trade only) and deep (trade and environment) trade agreements between those two large asymmetric countries, and we show that deep and shallow trade agreements have different outcomes in terms of world and individual countries welfares, trade specialization and environmental damages. Next, we develop two three-country, three-goods models, a “competing importers model” and a “competing exporters model”, and examine equilibrium agreements and environmental outcomes assuming (i) environmental agreements are negotiated separately, (ii) trade agreements are shallow, and (iii) trade agreements are deep. To examine the stability of endogenous deep and shallow trade agreements we set up various three stage games and use coalition-proof Nash equilibria refinement to circumvent the multiplicity of Nash equilibria. Furthermore, in order to examine the differences between shallow and deep trade agreements, we develop extended games where countries can choose between different deep and shallow PTAs and investigate how equilibrium agreements differ based on being deep or shallow. Therefore, in two different models of multiple asymmetric countries, we ask and answer the following questions: (i) how do equilibrium agreements differ when countries choose deep rather than shallow agreements?; (ii) given the choice between deep and shallow trade agreements, would countries prefer to incorporate an environmental clause into their equilibrium trade deal?; and (iii) what are the implications of including non-trade elements in PTAs for the pursuit of global free trade?