Dispute Settlement at the WTO is widely touted as the success story of the international economic order, yet we know remarkably little about whether WTO cases affect trade flows in any meaningful way. Specifically, when litigants announce a mutually satisfactory solution, does one gain more than the other? What truly takes place during early settlements, the contents of which are kept private? Does the complainant always benefit the most, as has been widely held? In this article we open the black box of early settlement, to show that the conventional wisdom on the distributional effects of WTO cases is missing a large piece of the puzzle. Settlements prior to rulings do benefit the complainant, but only in a narrow set of cases. Otherwise, going to panel has a more predictably positive effect on trade flows. By tracking trade flows of products at issue in disputes, we re-question the true impact of the legal body that has been called the cornerstone of the international trade regime.
