Obsolescing Bargains and Institutional Design: Balance in Post-War Institutions

• In Event: New Perspectives on International Collaboration

Abstract

Some multilateral institutions have extensive design features geared toward the protection of weaker states, while others do not. Why? Existing literatures, both power-based and institution-based, explain these features with reference to underlying power differentials and their derivatives (such as ability to finance). However, we argue that, in some circumstances, multilateral institutional design aims to artificially level the playing field, protecting the interests of states that are at greater risk from opportunism by their partners. Through institutional design, states try to prevent “obsolescing political bargains” between powerful states and their weaker counterparts. The expected risk of an obsolescing bargain is higher when: cooperation requires one state to invest more upfront than its partners; the less-potentially-vulnerable partners have reputations for reneging on commitments; and there is greater uncertainty about the future of technological change. In these situations, potentially-vulnerable states demand stronger institutional protections upfront, such as exemptions from certain rules, unbalanced representation on governance boards, and relatively more extensive rules limiting the autonomy of stronger states. When the gains from cooperation are high enough and all other design options have been rejected, stronger states accept these demands. Cases of “balanced” and “unbalanced” institutions from different aspects of the postwar regimes - trade, international finance, nuclear energy, public health, and telecommunications - provide evidence.

Authors

• Ayse Kaya, Swarthmore College

• Chad Rector, Marymount university