'Optimal' retaliation in the WTO - A commentary on the upland cotton arbitration

Gene M. Grossman, Alan O. Sykes

Research output: Contribution to journalReview articlepeer-review

17 Scopus citations


The Upland Cotton case raises a range of interesting issues regarding the rationale for retaliation in the WTO system and the proper approach to its calibration. These include: Should the approach to retaliation differ in cases involving prohibited or actionable subsidies? When should cross-retaliation be allowed? Should retaliation be based only on the harm to the complaining nation, or to other nations as well? And, most importantly, what economic content can be given to the standard of countermeasures 'equivalent to the level of nullification or impairment'? We address these and other issues from both a legal and economic perspective, with particular attention to the question of what level of retaliation will restore the lost welfare of the complaining nation.

Original languageEnglish (US)
Pages (from-to)133-164
Number of pages32
JournalWorld Trade Review
Issue number1
StatePublished - Jan 2011

All Science Journal Classification (ASJC) codes

  • Economics and Econometrics
  • Political Science and International Relations
  • Law


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