Title: Do preferential trade agreements provide reasonable insurance?

Authors: Craig Applegate; Chris Sadleir

Addresses: Faculty of Business, Government and Law, University of Canberra, ACT 2601, Australia ' Faculty of Business, Government and Law, University of Canberra, ACT 2601, Australia

Abstract: Preferential trade agreements have been criticised for not increasing economic welfare relative to the status quo. In this article, we suggest that even if this is the case, they offer a reasonable form of insurance against possible adverse trade or investment policies in the future. In Australia, preferential trade agreements have been controversial with the release of a Productivity Commission report in 2010 and the commonwealth government's response to it in 2011. A particularly controversial aspect of such agreements is whether they should include investor-state dispute resolution mechanisms which are often considered unnecessary in a country subject to the rule of law.

Keywords: preferential trade agreements; PTAs; free trade agreements; FTAs; regional trade agreements; investment promotion agreements; investment protection agreements; IPPAs; international trade; foreign investment; reasonable insurance; public policy; Australia; investor-state dispute resolution.

DOI: 10.1504/IJPP.2013.056583

International Journal of Public Policy, 2013 Vol.9 No.4/5/6, pp.389 - 399

Received: 13 Sep 2012
Accepted: 11 Apr 2013
Published online: 31 Jan 2014 *

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