Enforcing International Trade Agreements with Imperfect Private Monitoring
研究了国家在不完美私人监督下如何通过私人触发策略限制隐蔽贸易壁垒，并分析了WTO通过第三方触发策略将惩罚信号从私人转为公开，从而改善合作均衡的作用。
To analyse the role that the World Trade Organization (WTO) plays in enforcing international trade agreements, this paper first explores what countries can achieve alone by characterizing optimal <it>private trigger strategies</it> (<it>PTS</it>) under which each country triggers a punishment phase by imposing an <it>explicit</it> tariff based on privately observed imperfect signals of the other country's concealed trade barriers. It identifies the condition under which countries can restrain the use of concealed barriers based on <it>PTS</it> and establishes that countries will not reduce the cooperative protection level to its minimum attainable level under the optimal <it>PTS</it>. This paper then considers <it>third-party trigger strategies</it> (<it>TTS</it>) under which the WTO allows each country to initiate a punishment phase based on the WTO's judgement about potential violations. By comparing the optimal <it>PTS</it> and optimal <it>TTS</it>, it demonstrates that the WTO facilitates a better cooperative equilibrium by changing the nature of punishment-triggering signals from <it>private</it> to <it>public</it>, which in turn enables countries to use a more efficient punishment, such as an asymmetric and a minimum punishment.