Subsidies in Civil Aircraft Manufacturing: The World Trade Organization (WTO) and the Boeing-Airbus Dispute

Knorr, Andreas; Bellmann, Jörg; Schomaker, Rahel

doi:10.21552/estal/2012/3/308

Cited by 3 publications

(7 citation statements)

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“…The same reasoning applies to any business decision by economic players who are supposed to be fully aware of all strategic interdependences allowing them to anticipate any possible response(s) by competitors (Knorr et. al (2012)).…”

Section: Figurementioning

confidence: 98%

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'Flying High in a Plane' Appellate Body Report, European Communities and Certain Member States – Measures Affecting Trade in Large Civil Aircraft (WT/DS316/AB/RW)

Crivelli

Rubini

2019

SSRN Journal

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This article reviews the Appellate Body decision in the implementation phase of the EC-Aircraft dispute. Focusing on some of the key findings, we assess whether they are legally and economically correct. We conclude that a) though still unclear, the test for establishing de facto contingency on import substitution subsidies is probably too demanding; that b) though legitimate, the interpretation of the remedy of removal of the adverse effects for actionable subsidies is the weakest and most deferential possible; that c) the hesitation in confirming that quantitative methods are the key tool to define the relevant market is unwelcome; and that d) the Appellate Body correctly recognise the importance for Panels to consider, in the context of the serious prejudice analysis, whether the like product of the complainant has been subsidised. Most importantly, the analysis of this case, set within the broader jurisprudence and practice, has led us to conclude that WTO subsidy disciplines are not particularly strong. The review of the main economic theories justifying subsidy control (strategic trade policy, terms of trade, private information, commitment theory) has shown that no single theory is able to fully account for subsidies and the need to control them. The key question is the definition of what we want to achieve by controlling subsidies, which is the main message sent to the policy-makers and negotiators that are currently considering law reform.

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Section: Figurementioning

confidence: 98%

“…Indeed, airlines also benefits from economies of scope, for example regarding training and maintenance when operating a standardized fleet. This is the reason why an aircraft model is rarely produced without being accompanied by "derivatives" forming all together an aircraft family (Knorr et. al (2012)).…”

Section: Economics Of the Large Civil Aircraft Industrymentioning

confidence: 99%

'Flying High in a Plane' Appellate Body Report, European Communities and Certain Member States – Measures Affecting Trade in Large Civil Aircraft (WT/DS316/AB/RW)

Crivelli

Rubini

2019

SSRN Journal

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Section: Economics Of the Large Civil Aircraft Industrymentioning

confidence: 99%

‘Flying High in a Plane’ Appellate Body Report, European Communities and Certain Member States – Measures Affecting Trade in Large Civil Aircraft

Crivelli

Rubini

2020

World Trade Review

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This article reviews the Appellate Body decision in the implementation phase of the EC–Aircraft dispute. Focusing on some of the key findings, we assess whether they are legally and economically correct. We conclude that (a) though still unclear, the test for establishing de facto contingency on import substitution subsidies is probably too demanding; (b) though legitimate, the interpretation of the remedy of removal of the adverse effects for actionable subsidies is the weakest and most deferential possible; (c) the hesitation in confirming that quantitative methods are the key tool to define the relevant market is unwelcome; and (d) the Appellate Body correctly recognize the importance for Panels to consider, in the context of the serious prejudice analysis, whether the like product of the complainant has been subsidized. Most importantly, the analysis of this case, set within the broader jurisprudence and practice, has led us to conclude that WTO subsidy disciplines are not particularly strong. The review of the main economic theories justifying subsidy control (strategic trade policy, terms of trade, private information, commitment theory) has shown that no single theory is able to fully account for subsidies and the need to control them. The key question is the definition of what we want to achieve by controlling subsidies, which is the main message sent to the policy-makers and negotiators that are currently considering law reform.

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“…Around the world some national airlines, airports, air traffic management infrastructure and services are government owned, controlled and regulated. Some manufacturers receive tax incentives and subsidies (directly or indirectly) to help with the development of new commercial aircraft, and airlines receive government contracts to transport government personnel (Knorr, Bellmann, & Schomaker, 2012;Vasigh, Fleming, & Tacker, 2013). Government regulations and interventions have both facilitated and hinder the evolution of the airline-aviation industries (Button & McDougall, 2006;Gillen, 2011;Morrison & Winston, 1989).…”

Section: Aviation Regulationmentioning

confidence: 99%

“…Governments can provide funds or subsides for constructing airports, to develop new air routes, to upgrade production facilities, to research and develop new aircraft and aviation technology (Bednarek, 2016;Knorr et al, 2012;Ramos-Pérez, 2016;A. Smyth, Christodoulou, Dennis, AlAzzawi, & Campbell, 2012).…”

Section: Aviation Finance and Subsidiesmentioning

confidence: 99%

A study of carbon dioxide emissions reduction opportunities for airlines on Australian international routes

Yin¹

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Subsidies in Civil Aircraft Manufacturing: The World Trade Organization (WTO) and the Boeing-Airbus Dispute

Cited by 3 publications

References 0 publications

'Flying High in a Plane' Appellate Body Report, European Communities and Certain Member States – Measures Affecting Trade in Large Civil Aircraft (WT/DS316/AB/RW)

'Flying High in a Plane' Appellate Body Report, European Communities and Certain Member States – Measures Affecting Trade in Large Civil Aircraft (WT/DS316/AB/RW)

‘Flying High in a Plane’ Appellate Body Report, European Communities and Certain Member States – Measures Affecting Trade in Large Civil Aircraft

A study of carbon dioxide emissions reduction opportunities for airlines on Australian international routes

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