WTO Working Papers

WTO working papers usually represent research in progress. Such research may be conducted in the preparation of WTO Secretariat reports, studies or other material for WTO members. The papers are circulated for comment because the WTO considers critical review of professional research to be extremely important.


Public Services and the GATS

The status of public services is one of the most hotly debated issues surrounding the GATS. There are two approaches to distinguish such services from any other services: an institutional approach that focuses on the legal and institutional conditions governing supply (e.g. ownership status, market organisation), and a functional approach based on the policy objectives that may be involved (e.g. distributional and quality-related considerations, concepts of universal access). Given the wide range of institutional arrangements that exist in different jurisdictions, with significant variations over time, the former approach does not appear appropriate. The services provided by government-owned facilities, whose costs are covered directly by the State, may well be indistinguishable, for all practical purposes, from the services provided by private commercial operators, whose users (students, patients, passengers, etc.) are reimbursed. This paper discusses the relevance of the GATS for different organisational settings - from government monopolies to regulated and/or subsidized private provision - that may be used by WTO Members to meet typical public service objectives. It turns out that virtually all forms of organisation can be accommodated within the framework of the Agreement. To fully exploit its opportunities and avoid unpleasant surprises, however, governments would need to thoroughly analyse the relevant provisions in the light of their own policy objectives.


Keywords: public services, trade in services, WTO
JEL: H70: Public Economics / State and Local Government; Intergovernmental Relations / State and Local Government; Intergovernmental Relations: General; F13: International Economics / Trade / Trade Policy; International Trade Organizations; H40: Public Economics / Publicly Provided Goods / Publicly Provided Goods: General
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