Global governance

Matteo Fiorini, Bernard Hoekman, Petros Mavroidis, Douglas Nelson, Robert Wolfe, 09 July 2020

The WTO membership faces many challenges, ranging from substantive rulemaking on policies generating trade conflicts to revitalising the multilateral dispute settlement system. This column reports on the results of a recent survey of the trade community regarding the priorities confronting the next WTO Director-General. There is a substantial degree of commonality in rank orderings of substantive issues for negotiation, institutional reform, and daily operations of the WTO, but underlying this are significant differences in rankings of issues and options across groups of respondents. Resolving the dispute settlement crisis is a clear priority for most respondents, especially government officials. 

Matteo Fiorini, Bernard Hoekman, Petros Mavroidis, Douglas Nelson, Robert Wolfe, 08 July 2020

The WTO is looking for a new Director-General. This column reports on selected results of a recent survey designed to help identify what the trade community thinks is needed. The results suggest strong support for someone with managerial and political experience, and a professional network that spans international organisations, major capitals, and international business. African respondents assign the highest priority to regional diversity. Overall, there is a distinct contrast between the preferred profile and that of the incumbent.

Stephen P. Ferris, Jan Hanousek, Jiri Tresl, 30 April 2020

Corporation corruption is an issue that remains at the forefront of regulatory policy. This column examines the persistence of corruption among a sample of privately held firms from 12 Central and Eastern European countries. Creating a proxy for corporate corruption based on a firm’s internal inefficiency, it is suggested that corruption can enhance a firm’s overall profitability. A channel analysis reveals that inflating staff costs is the most common approach by which firms divert funds to finance corruption. Corruption may persist simply because of its ability to improve a firm’s return on assets.

Thomas Tørsløv, Ludvig Wier, Gabriel Zucman, 21 April 2020

Despite the legal frameworks and large amounts of lost tax revenue, profit-shifting practices persist around the world. This column argues that fiscal authorities of high-tax countries face an incentive problem in combatting profit shifting to tax havens. Enforcement efforts are focused on relocating profits booked in other high-tax countries rather than those in tax havens. This can ultimately result in lower global tax payments of multinational companies. The results call for a global corporate tax reform in order to save resources that currently go to wasteful and inconsequential tax enforcement.

Susan Ariel Aaronson, 05 February 2020

Individuals, citizens and firms have become increasingly dependent on data-driven services such as artificial intelligence and apps, and the same is true of defence and national security officials. This column argues that the US failure to adequately govern how firms use and monetise data affects national security in many ways. It also examines specific examples of the misuse of data and assesses the responses by the US and the EU.

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