The literature on pretrial dispute settlement has studied the effect of first-order uncertainty on pre-trial settlement bargaining while assuming away any uncertainty about higher-order beliefs. We propose a settlement bargaining model in which one player receives a private and noisy signal of...

Small and large countries show divergent behavior in the dispute settlement process of the WTO. Disputes that involve larger economies are more likely to result in litigation. Moreover, in a dispute between a large country and a small country, litigation is more likely if the small country is...