Please use this identifier to cite or link to this item: http://hdl.handle.net/10419/226234
Authors: 
Schjelderup, Guttorm
Stähler, Frank
Year of Publication: 
2020
Series/Report no.: 
CESifo Working Paper No. 8532
Abstract: 
This paper shows that Investor-State Dispute Settlements (ISDS) makes multinational firms more aggressive by increasing cost-reducing investments with the aim to enlarge the potential compensation an ISDS provision may offer. While a larger investment reduces the market distortion, it will also make potential compensations larger. Consequently, potential compensations to a foreign investor do not imply a zero-sum game. ISDS may decrease domestic welfare, in particular if the investment leads to the establishment of an export platform, and we find that even global welfare may decline.
Subjects: 
investor-state dispute settlement
multinational enterprises
foreign direct investment
TTIP
TPP
JEL: 
F21
F23
F53
F55
Document Type: 
Working Paper

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