Research Proposal Shorts II: Preference Clustering in Decentralized Cooperation Models

Note: Second in an occasional series of short research proposals on various topics in international relations.

Decentralized cooperation models, in the process of stylizing state interactions, appear to treat states approaching a negotiation as randomly distributed along dimensions of state preferences. However, the real world provides testable examples of states that may exhibit patterns of preference clustering, by geography, religion, or other extra-legal norms that could be expected to reduce some of the informational problems of cooperation. The states of the European Union share a set of norms that have helped facilitate “deep cooperation” (Downs et. al. 1996 "Is the Good News about Compliance Good News about Cooperation?," International Organization 50:379-406) agreements. Similarly, former colonies and their respective former colonial powers may share both legal standards and cultural norms that may provide the basis for deeper cooperation through greater prior certainty.

However, in the issue area of foreign aid, Abbott and Snidal (1998, “Why States Act Through Formal International Organizations,” Journal of Conflict Resolution 42:3-32) claim that, “States may prefer development assistance from an independent financial institution over direct aid from another state, especially a former colonial power or one seeking political influence.” This claim appears to be related to the functionalist argument elucidated by Simmons and Martin (2002, “International Organizations and Institutions,” pp. 192-211 in Carlsnaes et. al., Handbook of International Relations.) that delegation to an international institution can be beneficial if domestic institutions pose a barrier to realization of benefits by transferring policymaking to an international level.

The assumption that former colonies may prefer to reject support from former colonizers is empirically testable. If Abbott and Snidal’s claim is true, an analysis of foreign aid to former colonial countries should be expected to reflect a preference away from direct aid from a former colonizer and towards aid from IFIs. For example, publicly available data from the Philippines, a United States colony from 1935-1946, could be used to compare aid received from USAID versus IFIs such as the IMF and World Bank. An analysis across many more former colonies and colonial powers would, of course, be necessary. Two caveats to this type of test should be noted. First, foreign aid received may not fully reflect state preferences, but rather exogenous factors such as the availability of funds from the donor country. Second, a careful distinction should be made between direct assistance and loans, as states may respond differently to the conditions attached to each.

Decentralized cooperation models could also be specialized to sharpen the analysis of clarity of information between former colonies and former colonial powers. Shared history may not provide the only basis for this solution to the information problem. Since many former colonies gained sovereignty through colonial wars, the information collected by both parties through battle, negotiation and settlement may also serve to clarify information in future negotiations. Building on Axelrod and Keohane’s (1985, “Achieving Cooperation Under Anarchy,” World Politics 38:226-54) conception of a shadow of the future, which promotes long-term cooperation in iterated interactions, the postcolonial relationship can be characterized as creating a “shadow of the past,” where greater cooperation comes not from iterated future threats but from multiple levels of intertwined past experience.

The concept can be further expanded to sanctioning and monitoring models. If former colonies and former colonial powers in fact share certain norms, this might modify the punishment strategies available both actors. For example, the former colony may punish defection more harshly (retribution) or be unable to punish at all, while the former colonial powers may be restricted in range or severity punishments due to domestic audiences of immigrants or international norms (in the sense conveyed by Chayes and Chayes 1993, “On Compliance,” International Organization 47:175-206) which discourage a re-enactment of the previous power imbalance.

More generally, if the relationship between colonial and post-colonial states alleviates the information problem in negotiations, both parties would be expected to have lower transaction costs and therefore be more likely to enter cooperative agreements instead of resorting to IFIs or other IOs, another empirically testable supposition hinted at by this motivating area of research.