Power and Governance in a Partially Globalized World

Robert Keohane

• Publisher: Routledge
• Year: 2003
• ISBN:
  9781134443062
• Edition: 1
• Topic: Politica e relazioni internazionali
• Subtopic: Politica

As one of the most innovative and influential thinkers in international relations for more than three decades, Robert O. Keohane's groundbreaking work in institutional theory has redefined our understanding of international political economy.

Consisting of a selection of his most recent essays, this absorbing book address such core issues as interdependence, institutions, the development of international law, globalization and global governance. The essays are placed in historical and intellectual context by a substantial new introduction outlining the developments in Keohane's thought, and in an original afterword, the author offers a challenging interpretation of the September 11th attacks and their aftermath. Undoubtedly, this book is essential reading for anyone with an interest in international relations.

1 Introduction : from interdependence and institutions to globalization and governance¹

Robert O. Keohane
(2002)

This volume contains essays written (several in conjunction with co-authors) between 1990 and 2001. All of them revolve around issues of interdependence, institutions, and governance in world politics. They address a wide variety of different problems, but they do so, I believe, from the standpoint of a consistent analytical framework. That is, there is a view of how the world works embedded in these essays, each of which reveals a different aspect of this multifaceted understanding of world politics.

The purpose of this introduction is, first of all, to elucidate this conception of how the world works. It is both individualist and institutionalist, regarding institutions both as created by human action and as structuring that action. The principal motor of action in this view is self-interest, guided by rationality, which translates structural and institutional conditions into payoffs and probabilities, and therefore incentives. But my conceptions of self-interest and rationality are broad ones. Self-interest is not simply material; on the contrary, it encompasses one’s interest in being thought well of, and in thinking well of oneself. One’s self-interest is not divorced from one’s principled ideas or identity but closely connected with them. Furthermore, not all action is necessarily self-interested: actions such as those of firemen rushing into the burning World Trade Center on September 11, 2001, reflect commitment and courage rather than interest.

The resulting conception of how the world works is complex, seeking to take into account subjectivity as well as objectivity, primal urges for power as well as institutional constraints, principled beliefs and worldviews that cannot be validated as well as rational calculation. It therefore lacks parsimony. The core of my contribution to this view of the world has been to explore how international institutions operate, in the context of interdependence. But my exploration of institutions and interdependence has taken place in the context of an awareness of how they are affected by other, broader factors. Hence, I do not assume that institutions and interdependence are the most important aspects of contemporary world politics, that they somehow contain the unique key to history. Indeed, they only make sense if they are fit into the larger puzzle.

What follows is part intellectual autobiography, part elaboration of connections among views, and presumably part rationalization of arguments that I now see as more closely connected than they may have originally been.² After all, to a considerable extent we invent the past. Nevertheless, I believe that this reconstruction is not pure invention; and it can be at least partially tested by reference to the essays that appear, with minor stylistic or grammatical changes but without substantive changes, in this volume.

I begin with the concept of interdependence, as discussed and elaborated by Joseph S. Nye and myself in 1977. I next discuss what I call “institutional theory” and its research program, then turn to its implications for the study of international law. From there, I move to the two key buzzwords of our own day – globalization and governance – and try to show how, in discussing those concepts, I used and elaborated the framework of analysis developed earlier in the study of institutions and interdependence. At the end of this introduction, I refer to an essay that illustrates how my way of understanding world politics can be applied to contemporary events. Shortly after September 11 I set myself the task of asking about the implications of that attack for theories of world politics, in particular for the theories with which my own work is associated. My response was not meant to be comprehensive, since scholars with other specialties would respond from their own distinctive perspectives. But since this essay should illuminate both the value and the limitations of my own approach, it is included as Chapter 12 of this volume.

From interdependence to institutional theory

Over thirty years ago, astute observers of the world political economy began to comment on striking increases in economic connections among societies and the growing role of multinational corporations (Cooper 1968; Vernon 1971). Meanwhile, the literature on the European Community, pioneered by Ernst B. Haas, focused on how economic interdependence affected arrangements for governance (Haas 1958). Nye and I picked up on these themes, beginning with our edited special issue of International Organization on transnational relations (Keohane and Nye 1972), a term that we did not invent but that we did insert into the literature on world politics.

At that time the buzzword for these changes was “interdependence”. In the 1970s, Nye and I built a theory elucidating the notion of “complex interdependence,” an ideal type for analyzing situations of multiple transnational issues and contacts in which force is not a useful instrument of policy. We defined interdependence itself more broadly, to encompass strategic issues involving force as well as economic ones. In our analysis, interdependence is frequently asymmetrical and highly political: indeed, asymmetries in interdependence generate power resources for states, as well as for non-state actors. Power and Interdependence, published first in 1977, elaborated this theory and applied it to fifty years of history (1920–1970) in two issue-areas (oceans and money) and two country relationships (US–Australia and US–Canada). There were a number of gaps in our analysis, some of which we acknowledged a decade later,³ but the analysis of the relationship between asymmetrical interdependence and power continues to be useful, as illustrated by Chapter 12.

Power and Interdependence contained an incipient theory of institutions, in the form of what Nye and I called an international organization model of regime change (Keohane and Nye 1977, 54–58). But this theory was not well-developed. What preoccupied me for seven years after the publication of Power and Interdependence was the puzzle of why states establish international regimes – rule-oriented institutions that limit their Members’ legal freedom of action. In After Hegemony: Cooperation and Discord in the World Political Economy (1984), I presented a theory of international institutions based on rationalist theory, in particular economic theories of the firm and of imperfect markets. I argued that institutions perform important tasks for states, enabling them to cooperate. In particular, institutions reduce the costs of making, monitoring, and enforcing rules – transaction costs – provide information, and facilitate the making of credible commitments. In this theory, the principal guarantors of compliance with commitments are reciprocity (including both threats of retaliation and promises of reciprocal cooperation) and reputation. A brief summary of the major arguments of this theory, and a discussion of its evolution, is contained in Chapter 2 below.

My formulation of institutional theory has often been referred to as “liberal institutionalism” or “neo-liberal institutionalism.” These labels do not appeal to me, not just because they are awkward. My theory does have its roots in liberalism, as Chapters 3 and 11 demonstrate. But the connotations of liberalism are multiple and misleading. My theory has nothing to do with the view that commerce leads necessarily to peace; that people are basically good; or that progress in human history is inevitable – all propositions sometimes associated with liberalism. Nor is it connected with the view that liberty should have priority over equality and social justice, much less with the “neo-liberalism” of the past decade: the so-called “Washington Consensus” that dictated the dismantling of much governmental regulation of markets in developing countries. My liberalism is more pessimistic about human nature and more cautious about causal connections running from economics to politics than some versions of classical liberalism; and I have never been a supporter of the “Washington Consensus” in its strong neo-liberal form. Since attaching a “liberal label” to my perspective generates such a need for explication, it seems better to leave it off entirely.

“Institutionalist” is descriptive of my work, since it emphasizes the significance of institutions and seeks to explain them. Using this term is not meant as a claim to intellectual hegemony. Indeed, there are many other institutionalist theories, often with quite different concepts, and implications, than my own (March and Olsen 1995, Chapter 2; March and Olsen 1999; Ruggie 1998; Ruggie 1999). However, I regard my own formulation as having as good a claim to the adjective “institutionalist” as any of its competitors. When I refer below to “institutionalist theory,” I refer to my own version of institutionalism.

The theory in After Hegemony was rather stylized: as in Power and Interdependence, differences in domestic politics were deliberately overlooked for purposes of simplification. This is not to say that the importance of domestic politics was denied: quite the contrary. But the theory did not encompass domestic politics. Indeed, the theoretical gap created by the omission from the theory of domestic politics was sufficiently wide to drive many dissertations through it. Some of my former students have been leaders in this effort. They have analyzed the impact of domestic politics on world politics, in the context of a sophisticated understanding of interstate politics and the roles played by international institutions and non-state actors.⁴

The fact that my former students have written over a dozen books linking domestic politics and international relations is not only gratifying to me personally; it illustrates a broader aspect of American graduate education that is often overlooked. The resumés of scholars normally include only their own work. But the puzzles that they recognize but fail to address may be as important to their own students, and to their field as a whole, as their own contributions. Paths that lead through open doors may beckon more strongly to aspiring scholars than imposing intellectual edifices, no matter how impressive. And the explorations of graduate students instruct their professors. Graduate education is a process of interchange, not merely of transmission.

The theory developed in After Hegemony and closely related writings (e.g. Keohane 1986b) was strongly affected by my research on trade, monetary, and energy issues – all questions of material self-interest in which reciprocity played a substantial role. On the whole, the same framework fits environmental issues quite well (Haas, Keohane and Levy 1993; Keohane and Levy 1996). Perhaps this congruity should not be surprising, since similar questions arise of cross-border externalities and economic competition. On both sets of issues, monitoring of agreements is important and is carried out largely under the auspices of international institutions, while enforcement takes place through state action, legitimated through such institutions.

Environmental issues do have a moral dimension that is largely missing from the economic questions emphasized in After Hegemony. Principled ideas, concerned with right and wrong, play a significant role in mobilizing publics on issues such as ozone depletion, pollution of the oceans, and global warming. Such principled ideas play an even more prominent role on questions of human rights. And causal ideas, specifying connections between cause and effect, are important in policy debates in both issue-areas, as well as in other arenas of world politics.

Intrigued by the role of ideas, and their connections to rationalistic frameworks of analysis, Judith Goldstein and I began to explore the role of ideas on policy in the early 1990s (Goldstein and Keohane 1993). The role of ideas, of course, has been a long-standing theme in the work of a number of distinguished students of international relations, including my own mentor, Stanley Hoffmann (1987), Hedley Bull (1978), and Martin Wight (1992). Goldstein and I, however, were particularly interested in reconciling theories of rational choice, with which we were sympathetic, with our view that ideas are significant in world politics. We distinguished among three types of beliefs: worldviews, principled beliefs, and causal beliefs. Worldviews are illustrated by religion, principled beliefs by doctrines of human rights, and causal beliefs by Keynesian or monetarist theories of macroeconomics. All three types of belief affect policy, but they do so differently.

Goldstein and I went on to suggest that ideas exert effects along three causal pathways: (1) as “roadmaps,” (2) as focal points where there is no unique equilibrium, and (3) as embedded elements of institutions. Our essay is not reprinted here both because it is well-known and easily accessible, and because it forms an integral part of an edited volume to which it served as an introduction. But my thinking since the early 1990s has been deeply affected by my appreciation, heightened by work on this project, of the role of ideas in world politics. As noted below, my recent work on international law seeks to explore how the ideas incorporated in legal thinking affect persuasion and practice in world politics.

As these remarks imply, I disagree with the frequently-heard criticism that the role of ideas is necessarily de-emphasized by a view of the world that is based on an individualist ontology and a neo-positivist epistemology. It is individu...

Table of contents

• Cover
• Title
• Copyright
• Contents
• Dedication
• Preface
• Acknowledgments
• 1. Introduction: from interdependence and institutions to globalization and governance1
• PART I. Interdependence and institutions
• PART II. Law
• PART III. Globalism, liberalism, and governance
• Index