To Settle or to Fight to the End? Case-level Determinants of Early Settlement of Investor-State Disputes

Duy Vu

No 2018-36, GREDEG Working Papers from Groupe de REcherche en Droit, Economie, Gestion (GREDEG CNRS), Université Côte d'Azur, France

Abstract: International investment arbitration is a third-party dispute resolution mechanism aimed mainly at depoliticizing investment disputes and maintaining efficient investment flows among countries. Almost one-third of treaty-based investor-State disputes brought before this system are settled before the tribunal's final ruling. Given the classical "Against Settlement" debate in the legal literature, we build an original database of treaty-based arbitrations from 1996 to 2016 to empirically test the determinants of early settlement. We find that the probability of settlement increases if the host State has no experience of resolving those kinds of disputes but decrease if it anticipates a favorable outcome. The nature of the regulatory measures applied by the host State and the identity of foreign investors are additional important determinants of settlement. Interestingly, we find strong evidence of a Dutch effect in dispute resolution.

Keywords: Investor-State dispute settlement; international investment treaties; law and economics; applied econometrics (search for similar items in EconPapers)
JEL-codes: F21 F23 K41 (search for similar items in EconPapers)
Pages: 32 pages
Date: 2018-12, Revised 2020-02
New Economics Papers: this item is included in nep-law
References: Add references at CitEc
Citations: View citations in EconPapers (1)

Downloads: (external link)
http://195.220.190.85/GREDEG-WP-2018-36.pdf Revised version, 2020-02 (application/pdf)

Related works:
This item may be available elsewhere in EconPapers: Search for items with the same title.

Export reference: BibTeX RIS (EndNote, ProCite, RefMan) HTML/Text

Persistent link: https://EconPapers.repec.org/RePEc:gre:wpaper:2018-36

Access Statistics for this paper

More papers in GREDEG Working Papers from Groupe de REcherche en Droit, Economie, Gestion (GREDEG CNRS), Université Côte d'Azur, France Contact information at EDIRC.
Bibliographic data for series maintained by Patrice Bougette ().