The David Effect and ISDS

<!DOCTYPE html> <html lang="en"> <head> <title>The David Effect and ISDS - EJIL</title> <meta http-equiv="X-UA-Compatible" content="IE=edge"> <meta http-equiv="Content-Type" content="text/html; charset=utf-8" /> <meta name="viewport" content="width=device-width, initial-scale=1.0" /> <meta name="application-name" content="EJIL"> <meta name="author" content="EJIL"> <meta name="keywords" content="" /> <meta name="description" content="" />  <link rel="stylesheet" href="https://maxcdn.bootstrapcdn.com/bootstrap/3.3.7/css/bootstrap.min.css" integrity="sha384-BVYiiSIFeK1dGmJRAkycuHAHRg32OmUcww7on3RYdg4Va+PmSTsz/K68vbdEjh4u" crossorigin="anonymous"> <link href="https://fonts.googleapis.com/css?family=Open+Sans" rel="stylesheet"> <link href="./css/style.css" rel="stylesheet" type="text/css" /> </head> <body> <header> <div class="pre-nav container-full"> <img id="logo" src="/images/logo.svg" alt="EJIL"> <div id="metaNav"> <nav role="navigation" aria-label="Meta navigation"> <ul class="remove-list-style"> <li id="skippy"><a href="#content" class="sr-only sr-only-focusable">Skip to main content</a></li> <li><a href="/contactus.php">Contact</a></li> <li><a href="http://services.oxfordjournals.org/cgi/alerts/etoc?goAlpha=Alphabetically">Join Mailing List</a></li> </ul> </nav> <form action="search.php" method="post" id="search" class="searchform"> <label for="keywords" class="hidden">Search</label> <input type="text" id="keywords" name="keywords" placeholder="Search" /> </form> </div> </div> <div id="primaryNav"> <nav class="container" role="navigation" aria-label="Main navigation"> <ul id="menu-main" class="nav nav-justified nav-tabs"> <li class=""><a class="" href="/index.php">Home</a></li> <li class=""><a href="/about/index.php">About EJIL</a></li> <li class=""><a href="/current.php">Current issue</a></li> <li class=""><a href="/live.php">EJIL: <strong><em>Live!</em></strong></a></li> <li class=""><a href="/podcasts.php">EJIL: <strong><em>The Podcast!</em></strong></a></li> <li class=""><a href="/bookreviews/index.php">Book reviews</a></li> <li class=""><a href="/archives.php">Archives</a></li> </ul> </nav> </div> </header> <main class="generalpage container content article"> <h1>Articles</h1> <div class="title">The David Effect and ISDS</div> <ul class='authors'> <li>Puig, Sergio <a href='#1'>1</a></li><li>Strezhnev, Anton <a href='#2'>2</a></li> </ul> <h2>Abstract</h2> <p class='abstract'>The legitimacy of international investment law is fiercely contested. Chiefly, scholars argue that investor–state dispute settlement empowers corporations from rich nations over governments of poor ones. Some also assert that poor nations facing investment claims have limited ability to improve their standing in this setting of adjudication. Based on a first-of-its-kind experiment conducted on 257 international arbitrators, this article argues that one avenue to improve standing is for developing countries to exploit their ‘underdog’ status. We presented arbitrators with a vignette describing an investor–state dispute and randomly assigned different features to test their effect. Our results suggest arbitrators are prone to a particular type of bias – surveyed professionals were more likely to grant poor respondent states reimbursement of their legal costs compared to wealthy states when the respondent won the dispute. Based on this ‘David effect’, we argue for re-conceptualizing investor–state arbitration as a tool for partially mitigating power imbalances.</p> <ul class="authors_infos remove-list-style"> <li><a id='1' name='1'>1</a>Associate Professor, James E. Rogers College of Law, University of Arizona, Tucson, AZ, USA. Email: spuig@email.arizona.edu.</li><li><a id='2' name='2'>2</a>PhD Candidate, Department of Government, Harvard University, Cambridge, MA, USA. Email: astrezhnev@fas.harvard.edu. The authors would like to thank Christopher T. Robertson, Susan D. Franck, Josh Kertzer and Beth Simmons for helpful comments or suggestions.</li> </ul> <span class="glyphicon glyphicon-download-alt" aria-hidden="true"></span> <a href='./pdfs/28/3/2807.pdf' target='_blank' onclick="ga('send', 'event', 'File', 'PDF', 'Vol. 28 (2017) No. 3 - The David Effect and ISDS (./pdfs/28/3/2807.pdf)');">Full text available in PDF format</a><div id='download_acrobat_reader'>The free viewer (Acrobat Reader) for PDF file is available at the <a href='http://www.adobe.com/products/acrobat/readstep2.html'>Adobe Systems</a></div> <div class="navigation"> <a href='article.php?article=2798&issue=137'>Previous Page</a><a href='archive.php?issue=137'>Table of contents</a><a href='article.php?article=2796&issue=137'>Next Page</a> </div> </main> <footer> <ul class="logos remove-list-style"> <li><a href="https://www.eui.eu/en/academic-units/academy-of-european-law"><img src="./images/logo_eui.png" alt="EUI"></a></li> <li><a href="http://www.law.nyu.edu/"><img src="./images/logo_nyu.png" alt="NYU Law"></a></li> <li><a href="http://ejil.oxfordjournals.org/"><img src="./images/logo_oups.png" alt="Oxford University Press"></a></li> <li><a href="http://www.esil-sedi.eu/"><img src="./images/logo_esil.png" alt="ESIL"></a></li> </ul> <p>© 1998 - 2025 European Journal of International Law <br />All comments and suggestions should be sent to the Webmaster. <br />This site is part of the Academy of European Law online, a joint partnership of the Jean Monnet Center at NYU School of Law and the Academy of European Law at the European University Institute.</p> </footer> </body>  <script> (function(i,s,o,g,r,a,m){i['GoogleAnalyticsObject']=r;i[r]=i[r]||function(){ (i[r].q=i[r].q||[]).push(arguments)},i[r].l=1*new Date();a=s.createElement(o), m=s.getElementsByTagName(o)[0];a.async=1;a.src=g;m.parentNode.insertBefore(a,m) })(window,document,'script','//www.google-analytics.com/analytics.js','ga'); ga('create', 'UA-11073886-2', 'auto'); ga('send', 'pageview'); </script> <script src="http://code.jquery.com/jquery-1.11.2.min.js"></script> <script type="text/javascript" src="./js/analytics.js"></script> </html>

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The David Effect and ISDS - EJIL