The Economics of Investor Protection: ISDS versus National Treatment

Köhler, Wilhelm; Stähler, Frank

doi:10.2139/ssrn.2752375

Cited by 3 publications

(3 citation statements)

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“…A …rst literature focuses on dispute settlement procedures in trade agreements (see Park, 2016, for a recent survey); within this literature, our paper is most closely related methodologically to Maggi and Staiger (2011), who provide the basic model of dispute settlement in trade agreements on which we build. A second and more recent literature focuses on dispute settlement procedures in investment treaties (see, for example Konrad, 2017, Horn, 2018, Stahler, 2018, Horn and Tangeras, 2019, Janeba, 2019, Kohler and Stahler, 2019and Sykes, 2019. Our use of the Maggi and Staiger (2011) framework makes us methodologically distinct from these papers.…”

Section: Introductionmentioning

confidence: 99%

Disputes in International Investment and Trade

Ossa

Staiger

2022

SSRN Journal

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Section: Introductionmentioning

confidence: 99%

Disputes in International Investment and Trade

Ossa

Staiger

2022

SSRN Journal

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“…As for ISDS, Kohler and Stähler (2019) find that an ISDS provision may improve aggregate welfare generated by a relationship between a foreign investor and a host country if strategic ownership changes could be ruled out. However, the ISDS provision will lead to further distortions and can never achieve the first best.…”

Section: Introductionmentioning

confidence: 99%

An optimal investor-state dispute settlement mechanism

Stähler

2022

J Econ

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Many investment treaties include investor-state dispute settlement (ISDS) provisions which are supposed to protect a foreign investor against opportunistic behavior of a host country. This paper scrutinizes the optimal design of ISDS provisions that solve the holdup problem. It shows that an efficient investor protection mechanism requires an arbitrator as established in investment treaties. However, this arbitrator does neither have to learn nor to evaluate the circumstances of the dispute. Furthermore, any ISDS compensation from the government to the investor should not be based on reductions in investor profits but on the host country’s welfare effects.

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“…The testimony was on March 21, 2018, before the US House Ways and Means Committee. 1 0 See the contributions by e.g Janeba (2016),Kohler and Stähler (2016),Konrad (2017),Schjelderup andStähler (2016), andHorn andTangerås (2017)Sykes (2005).…”

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confidence: 99%