Getting ‘real’ about ISDS reform: a critical realist view of international investment law’s status quo

Abstract Investor–State dispute settlement (ISDS) is the topic of a concerted reform effort by actors in International Investment Law (IIL). The proposals proffered by United Nations Commission on International Trade Law’s Working Group III have centred around rectifying procedural complaints like the inconsistency in arbitral case law. Little attention has been given to more paradigmatic ideas such as abandoning international arbitration altogether. This article argues that the absence of any meaningful consideration for a radical departure from the current status quo is largely the effect of epistemological privilege. I adopt the philosophical framework of Critical Realism to argue that much of the work towards reforming the regime is grounded in empirical epistemologies that do not consider the deeper, more complex issues that affect IIL’s operation. I make this argument through an examination of behavioural economics’ integration into scholarship and the positivist basis of the reform proposal for an advisory centre for international investment law.