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Broude, Tomer; Moses, Shai --- "The behavioural dynamics of positive and negative listing in services trade liberalization: A look at the Trade in Services Agreement (TiSA) negotiations" [2016] ELECD 1156; in Sauvé, Pierre; Roy, Martin (eds), "Research Handbook on Trade in Services" (Edward Elgar Publishing, 2016) 385

Book Title: Research Handbook on Trade in Services

Editor(s): Sauvé, Pierre; Roy, Martin

Publisher: Edward Elgar Publishing

ISBN (hard cover): 9781783478057

Section: Chapter 15

Section Title: The behavioural dynamics of positive and negative listing in services trade liberalization: A look at the Trade in Services Agreement (TiSA) negotiations

Author(s): Broude, Tomer; Moses, Shai

Number of pages: 27

Abstract/Description:

From a standard rational choice perspective, the choice architecture of an international trade in services liberalization scheme as structured around either positive or negative listing should not have any appreciable effect on the depth and breadth of commitments. In contrast, behavioral economics, in particular Prospect Theory and phenomena such as framing effects and status quo bias, suggest that a negative list approach would be more conducive to economic liberalization. Several additional complicating factors, such as sectoral considerations, negotiating asymmetries and transaction costs, preclude this hypothesis from being subjected to reliable empirical testing. However, a case study of the currently ongoing negotiations towards a plurilateral Trade in Services Agreement (TiSA), reveals that trade diplomats are acutely attuned to the potential importance of such negotiated ‘choice architecture’, and that behavioral effects can exert significant influence on negotiations. This demonstrates that behavioral dynamics, especially compromise effects, are a significant part of international trade talks, at least with respect to services trade.