POLI 441 Lecture Notes - Lecture 14: De Facto, World Trade Organization, The Takeaway
Document Summary
Bound rates - the legal maximum up to which you can raise protection. Applied rates - the actual rates you use at the border. Usually positive - there is unused protection in the system, on average 18% When countries have access to both (binding overhand and costly to use flexibility), countries prefer the latter - they opt for the more costly one. Takeaway: cheap flexibility but not as used as one might thing. It"s so cheap that no one can afford to use it. Agriculture and textiles were left off the table as a concession to developing countries. His point is to show that the wto doesn"t have an effect. De facto membership (tomz) is saying that because of the wto you have this. It takes away from rose: saying the wto effect is true for non-wto members. Concern is that the thing you are using to explain something itself is caused by something that is within your causal chain.