Please use this identifier to cite or link to this item: https://hdl.handle.net/10419/338359 
Year of Publication: 
2026
Series/Report no.: 
CESifo Working Paper No. 12395
Publisher: 
Munich Society for the Promotion of Economic Research - CESifo GmbH, Munich
Abstract: 
We study the sustainability of international trading rules in a multipolar world. A rules-based equilibrium is shaped by three forces. A static temptation to exploit market power undermines cooperation, while two dynamic forces support it: the efficiency gains from rules and the cost of reestablishing the regime once a country becomes hegemonic. When multipolarity is short-lived and involves few co-leaders, a strong enough prospect of future hegemony ensures rules cooperation. However, in a more fragmented world, the sustainability of rules is more likely if shared leadership is expected to persist, to ensure long-lasting efficiency gains.
Subjects: 
hegemonic stability theory
World Trade Organization
trade agreements
multipolarity
JEL: 
F02
F13
F53
H87
Document Type: 
Working Paper
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