The Ordo-Liberal Origins of Modern International Investment Law: Constructing Competition on a Global Scale

This article historicises contemporary international economic law, with an emphasis on bilateral investment treaties (BITs) and investor-state dispute settlement clauses (ISDS). Reacting to the apparent paradox that the first states to conclude such agreements in the late 1950s were West Germany and Switzerland, it puts forward the argument that we need to pay closer attention to the ordo-liberal origins of international economic law. By focusing on the dual move of internationalisation and judicialisation of economic governance through BITs and ISDS clauses this article contends that both these developments represent attempts to resolve the problem of the politicisation of the global economy, an issue that was central to the ordo-liberal project. In developing this line of inquiry, the article explores some of the core elements of the ordo-liberal theory of law and its relationship with the global economy, focusing specifically on the writings of the German scholar Wilhelm Röpke produced shortly before, during, and immediately after World War II. In this context, international economic law is conceptualised as a mechanism that constructs the ordo-liberal competitive order on a global scale, while ensuring that the state is institutionally strong, yet limited in the functions ordo-liberals considered to be acceptable.