July 1 what is the role of international organizations and do they really matter
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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 Organizations. Journal of Conflict Resolution 42:3-32. Last class take-home point. Analytical tool: Time inconsistent preference problem

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July 1 what is the role of international organizations and do they really matter

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.


Last class take home point

Last class take-home point

  • Analytical tool:

    • Time inconsistent preference problem

    • A.K.A. (also known as):

      • Commitment problem

      • Present bias


Do ios matter

Do IOs matter?


Dramatic action

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


Ongoing action

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


Various sizes

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)


Specialized agencies

Specialized agencies:

  • ILO

    • http://www.ilo.org/global/What_we_do/lang--en/index.htm

  • ICAO

    • http://www.icao.int/icao/en/howworks.htm

  • FAO

    • http://www.fao.org/about/about-fao/en/

  • Others:

    • UNEP

      • http://www.unep.org/Documents.Multilingual/Default.asp?DocumentID=43

    • EBRD

      • http://www.ebrd.com/about/index.htm


Finding research on ios

Finding research on IOs:

  • Google Scholar!!! http://scholar.google.com/

  • ISI Web of Science http://isiknowledge.com/


Ios allow for

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


Rational choice perspective

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


Pd settings

PD settings?

  • Prisoner's dilemma

  • http://www.youtube.com/watch?v=ED9gaAb2BEw&feature=related

  • http://www.youtube.com/watch?v=p3Uos2fzIJ0


Prisoner s dilemma

Prisoner's Dilemma:

  • A non-cooperative, non-zero-sum game. (Mixed game of cooperation and conflict.)

  • Individual rationality brings about collective irrationality.


July 1 what is the role of international organizations and do they really matter

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…"


July 1 what is the role of international organizations and do they really matter

  • 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.


July 1 what is the role of international organizations and do they really matter

  • 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.


Is cooperation ever possible in prisoner s dilemma

Is cooperation ever possible in Prisoner's Dilemma?

  • Yes 

    • In repeated settings

  • Axelrod, Robert M. 1984. The Evolution of Cooperation. New York: Basic Books.


July 1 what is the role of international organizations and do they really matter

  • So, IOs facilitate cooperation by coordinating states on superior equilibria/outcomes

  • And lower the transaction costs of doing so


Alternatives to the rational institutionalist perspective

Alternatives to the rational-institutionalist perspective


Realist theory

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)


Constructivist theory

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


Abbot snidal

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


Principal agent framework

Principal-Agent framework

  • IOs are thus "agents"

  • Their (biggest) members are the "principals"

  • Agency slack? 

    • "bureaucratic" perspective


The principal agent problem

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?)


July 1 what is the role of international organizations and do they really matter

  • 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…


Solution

Solution?

  • TRANSPARENCY?


Public choice bureaucratic theory

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


Back to rational institutionalist view

Back to rational-institutionalist view…


What do ios do for their members

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)


Laundering

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


Neutrality

Neutrality

  • Providing information

    • Really? http://www9.georgetown.edu/faculty/jrv24/IMFforecasts.html

  • Collecting information

    • Really! http://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=15


Community representative

Community representative

  •  Legitimacy

  • Articulate norms? http://goodliffe.byu.edu/papers/catcascade2.pdf

  • Universal Jurisdiction (more than a norm - a legal standard) – The CAT

  • Honduras and the OAS??


Enforcement

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


Answers to today s question

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


Analytical tools

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


Thank you

Thank you


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