This paper analyzes the expected benefits of investment treaties, including: increased inward investment, increased outward investment, and depoliticization of investment disputes. It then considers evidence of the costs of investment treaties, including: litigation, liability, reputational cost, reduced policy space, distorted power dynamics, reduced role for domestic law-making, and uncertainty in the law. The authors set forth practical steps that states can take relating to both existing treaties as well as future treaties with an objective of increasing desired benefits and decreasing unexpected and high costs of investment treaties. Also available in Mandarin here, and in Spanish here.
A shorter piece on “The Outsized Costs of Investor-State Dispute Settlement” from 2016 similarly shows that the costs of ISDS outweigh its alleged benefits, and alternative strategies should be employed to protect investors and promote the rule of law.