Balancers in Designs of International Trade Institutions: Flexibility Theory and Its Empirical Evidences.

The core of "flexibility theory" in designs of international institutions hinges on the need to strike a balance between legalism and flexibility. What has been missed in debates is how to balance these two sides of the same coins and what would be the determinants of this balance. I suggest a flexibility theory of trade-off in multilateral trade institutions. Multilateral trade regimes can be located from full-scale flexibility to the maximum legalism. What determines their locations depends on what kinds of issue they deal with. If a regime mainly faces short-term problems such as coordination in economic crisis, the optimal point should be closer to legalism. On the other hand, if an institution manages long-term projects like free trade promotion and economic development through building trade coalitions, its optimal point is located in the direction of flexibility. The balancing act in optimal design depends on issue-specific. Therefore, if regime's main tasks have evolved, the optimal point of regime is also changed. The evolution of GATT/WTO regime illustrates this point clearly. Systematic empirical evidence is provided by investigating the major international trade regimes created from 1945 to 2000. ..PAT.-Unpublished Manuscript [ABSTRACT FROM AUTHOR]