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July 1: What is the role of international organizations and do they really matter? Abbot, Kenneth and Duncan Snidal. 1998. Why States Act through Formal.

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Presentation on theme: "July 1: What is the role of international organizations and do they really matter? Abbot, Kenneth and Duncan Snidal. 1998. Why States Act through Formal."— Presentation transcript:

1 July 1: What is the role of international organizations and do they really matter? Abbot, Kenneth and Duncan Snidal. 1998. Why States Act through Formal Organizations. Journal of Conflict Resolution 42:3-32.

2 Last class take-home point Analytical tool: –Time inconsistent preference problem –A.K.A. (also known as): Commitment problem Present bias

3 Do IOs matter?

4 Dramatic action United Nations Security Council (UNSC) sanctions on Libya International Atomic Energy Agency (IAEA) inspectors in North Korea United Nations (UN) peacekeepers in the Middle East North Atlantic Treaty Organization (NATO) in Bosnia The Uruguay Round the World Trade Organization (WTO) & the dispute settlement mechanism

5 Ongoing action: Global health policy (the WHO) Development (the World Bank) Monetary policy (the International Monetary Fund) Participation reduces the chances of war among members Participation increases the chances of democracy

6 Various sizes: From: –Asia-Pacific Economic Cooperation forum (APEC) - $2 million budget (pays for their annual meeting?) To: –European Union (EU) - verging on a sovereign state –World Bank - >10,000 employees from 160 countries (2/3 in Washington) –IMF (Aug. 2008: $341 billion)

7 Specialized agencies: ILO –http://www.ilo.org/global/What_we_do/lang--en/index.htmhttp://www.ilo.org/global/What_we_do/lang--en/index.htm ICAO –http://www.icao.int/icao/en/howworks.htmhttp://www.icao.int/icao/en/howworks.htm FAO –http://www.fao.org/about/about-fao/en/http://www.fao.org/about/about-fao/en/ Others: –UNEP http://www.unep.org/Documents.Multilingual/Default.asp?Document ID=43http://www.unep.org/Documents.Multilingual/Default.asp?Document ID=43 –EBRD http://www.ebrd.com/about/index.htm

8 Finding research on IOs: Google Scholar!!! http://scholar.google.com/ http://scholar.google.com/ ISI Web of Science http://isiknowledge.com/ http://isiknowledge.com/

9 IOs allow for: CENTRALIZATION –A concrete and stable organizational structure and an administrative apparatus managing collective activities May allow for immediate action (UN Security Council) Or for specialization (OECD has >200 working groups) May have flexible design (IMF voting structure) or be rigid (UN Security Council) INDEPENDENCE –The ability/authority to act with a degree of autonomy within defined spheres

10 Rational choice perspective: LEADERS found/use IOs when benefits of cooperation outweigh (sovereignty) costs IOs produce collective goods in PD settings & solve coordination problems Coordination problems? –E.g., Battle of the sexes game

11 PD settings? Prisoner's dilemma http://www.youtube.com/watch?v=ED9gaA b2BEw&feature=relatedhttp://www.youtube.com/watch?v=ED9gaA b2BEw&feature=related http://www.youtube.com/watch?v=p3Uos2f zIJ0http://www.youtube.com/watch?v=p3Uos2f zIJ0

12 Prisoner's Dilemma: A non-cooperative, non-zero-sum game. (Mixed game of cooperation and conflict.) Individual rationality brings about collective irrationality.

13 Example… –You're reading Tchaikovsky's music on a train back in the USSR. –KGB agents suspect it's secret code. –They arrest you & a "friend" they claim is Tchaikovsky. –"You better tell us everything. We caught Tchaikovsky, and he's already talking…"

14 You know that this is ridiculous – they have no case. But they may be able to build a case using your testimony and "Tchaikovsky's." If you "rat" out your "friend" – they will reduce your sentence. If not, they will throw the book at you.

15 Player 2 Player 1 Cooperate w/friendDefect (rat) Cooperate w/friend -3, -3-25, -1 Defect (rat) -1, -25-10, -10

16 The same situation can occur whenever "collective action" is required. The collective action problem is also called the "n-person prisoner's dilemma." Also called the "free rider problem." "Tragedy of the commons." All have similar logics and a similar result: –Individually rational action leads to collectively suboptimal results.

17 Is cooperation ever possible in Prisoner's Dilemma? Yes In repeated settings Axelrod, Robert M. 1984. The Evolution of Cooperation. New York: Basic Books.

18 So, IOs facilitate cooperation by coordinating states on superior equilibria/outcomes And lower the transaction costs of doing so

19 Alternatives to the rational- institutionalist perspective

20 Realist theory States do not cede to supranational institutions the strong enforcement capacities necessary to overcome international anarchy Thus, IOs and similar institutions are of little interest They merely reflect national interests and power and do not constrain powerful states Does realism = rational choice? Realism focuses on state interests - ignores microfoundations (leader incentives, domestic politics)

21 Constructivist theory Where to ideas and preferences come from? Focus on norms, beliefs, knowledge, and (shared) understandings IOs are the result of international ideas, and in turn contribute towards shaping the evolution of international ideas Vital for the understanding of major concepts such as legitimacy and norms

22 Abbot & Snidal: States use IOs to… Reduce transaction costs; Create information, ideas, norms, and expectations; Carry out and encourage specific activities; Legitimate or delegitimate particular ideas and practices; Enhance their capacities and power

23 Principal-Agent framework IOs are thus "agents" Their (biggest) members are the "principals" Agency slack?  – "bureaucratic" perspective

24 The principal-agent problem The agent works for the principal The agent has private information The principal only observes an outcome Must decide to reelect/pay/rehire/keep the agent If standards are too low, the agent “shirks” If standards are too high, the agent gives up We need a Goldilocks solution – set standards “just right.” We may have to accept some an “information rent” –Either pay extra or accept agency slack (corruption?)

25

26 If reelection criteria are too high, the government will not supply effort when exogenous conditions are bad. If reelection criteria are too low, the government will not supply effort when conditions are good. What should you do? Intuition: It depends on the probability of good/bad conditions & on the difference in outcomes when conditions are good/bad…

27 Solution? TRANSPARENCY?

28 Public choice/Bureaucratic theory IOs are like any bureaucracy Allow governments to reward people with cushy jobs The bureaucracy is essentially unaccountable Seek to maximize their budgets Look for things to do

29 Back to rational-institutionalist view…

30 What do IOs do for their members? Pooling resources (IMF/World Bank, World Health Organization) - share costs, economies of scale Direct joint action - e.g., military (NATO), financial (IMF), dispute resolution (WTO)

31 LAUNDERING Allow states to take (collective) action without taking direct responsibility (or take responsibility with IO support) Examples: –The IMF does the dirty work –UN Security Council resolutions - a form of laundering? When an IO legitimates retaliation, states are not vigilantes but upholders of community norms, values, and institutions Korean War - The United States cast essentially unilateral action as more legitimate *collective* action by getting UN Security Council approval

32 Neutrality Providing information –Really? http://www9.georgetown.edu/faculty/jrv24/IMFforecasts.html http://www9.georgetown.edu/faculty/jrv24/IMFforecasts.html Collecting information –Really! http://www9.georgetown.edu/faculty/jrv24/transparency.htmlhttp://www9.georgetown.edu/faculty/jrv24/transparency.html Example –Blue helmets: –http://www.youtube.com/watch?v=O0n2- YpwPWY&feature=PlayList&p=BBF5269792FC9ED6&playnext=1& playnext_from=PL&index=15http://www.youtube.com/watch?v=O0n2- YpwPWY&feature=PlayList&p=BBF5269792FC9ED6&playnext=1& playnext_from=PL&index=15

33 Community representative  Legitimacy Articulate norms? http://goodliffe.byu.edu/papers/catcascade 2.pdf http://goodliffe.byu.edu/papers/catcascade 2.pdf Universal Jurisdiction (more than a norm - a legal standard) – The CAT Honduras and the OAS??

34 Enforcement? The problem of endogeneity –100% Compliance may mean the IO is doing *nothing* –Be careful what conclusions we draw from observations Compliance is meaningful only if the state takes action it would not take in the absence of the IO IMF/World Bank CONDITIONALITY

35 Answers to today's question: IO's reduce transaction costs - costs of doing business & coordinate on superior equilibria Enabling members to have: –LAUNDERING –Neutrality –Community representative –Enforcement –Legitimacy - shared beliefs that coordinate actors regarding what actions should be accepted, tolerated, resisted, or stopped To these ends IOs are created centralized & independent

36 Analytical tools Time inconsistent preference problem / Commitment problem / Present bias Research networking Prisoner’s dilemma Principal-Agent framework Realist theory Constructivist theory Public choice/Bureaucratic theory

37 Thank you


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