International organizations, International relations, Institutions, Performance, F53, F55,

This article seeks to explain why the World Bank's environmental performance is so uneven despite numerous reform efforts. I argue that a principal-agent model offers a potentially powerful tool for analyzing gaps between the mandates and performance of international organizations (IOs) such as the World Bank. The model is particularly useful when it is calibrated to recognize problems of antinomic delegation and the dual role an IO may have as both agent and principal. Antinomic delegation occurs when states ask IOs to take on complex tasks that are difficult to institutionalize. Recognizing that many IOs may be principal and agent at different stages of the policy process reveals more opportunities for agency slack that are not well addressed by the IO literature. This article presents these modifications to the principal-agent model and applies the model to the case of the World Bank. The case study demonstrates that the nature of the tasks being delegated and the incentives shaping both sides of the principal-agent relationship are key sources of disconnect between the institution's stated goals and its performance. Copyright (c) 2005 Massachusetts Institute of Technology.

Contents2.1. Total explicit subsidy costs of Egypt's food subsidy system, by commodity, 1980/81 to 1996/97 8 3.1. Rates of food subsidy to consumers per unit of commodity, 1996/97 14 5.1. Allocation of food subsidy beneµts, and distribution of population and poverty, by governorates 5.2. Urban and rural allocations of per capita absolute food subsidy beneµts, by governorates, 1997 5.3. Distribution of food subsidy beneµts and poverty, by region, 1997 5.4. Per capita purchases of subsidized and open-market bread and ×our, by region 5.5. Share of households purchasing subsidized baladi bread and wheat ×our, by region and expenditure quintile 5.6. Per capita monthly absolute beneµts to consumers from subsidized baladi bread and wheat ×our, by region and expenditure quintile 5.7. Average travel time to baladi bread outlets, by expenditure quintile 5.8. Average time waiting in line to purchase subsidized baladi bread, by expenditure quintile 5.9. Restrictions on subsidized baladi bread and wheat ×our purchases, by expenditure quintile 5.10. Share of households holding ration cards, by expenditure quintile 5.11. Households with green and red ration cards, by expenditure quintile 39 5.12. Prevalence of unregistered members in the ration card-holding households, by expenditure quintile 5.13. Self-reported reasons for unregistered household members, by expenditure quintile 5.14. Per capita purchases of rationed and open-market sugar and cooking oil, by region iv Tables 5. 15. Share of all households purchasing subsidized sugar and cooking oil, by region and expenditure quintile 5.16. Per capita monthly absolute beneµts to consumers from subsidized and rationed sugar and cooking oil, by region and expenditure quintile 5.17. Per capita monthly absolute beneµts to consumers from all four subsidized commodities, and total beneµts expressed as a percent of total per capita expenditures, by region and expenditure quintile 6.1. Purchases of subsidized baladi bread 6.2. Purchases of subsidized wheat ×our 6.3. Purchase of subsidized rationed sugar 6.4. Purchases of subsidized rationed cooking oil 6.5. Leakage in the baladi bread subsidy system 6.6. Leakage in the wheat ×our subsidy system 6.7. Leakage in the rationed sugar subsidy system 6.8. Leakage in the rationed cooking oil subsidy system 6.9. Per capita monthly baladi bread subsidy beneµts accruing to expenditure quintile groups, by region, and beneµts to nonneedy, 1997 6.10. Per capita monthly wheat ×our subsidy beneµts accruing to expenditure quintile groups, by region, and beneµts to nonneedy, 1997 6.11. Per capita monthly sugar subsidy beneµts accruing to expenditure quintile groups, by region, and beneµts to nonneedy, 1997 6.12. Per capita monthly cooking oil subsidy beneµts accruing to expenditure quintile groups, by region, and beneµts to nonneedy, 1997 6.13. International comparison of cost-effectiveness of selective programs 7.1. Per capita expenditures, calorie availability, and calorie cost, by food group for metropolitan Egypt, 1997 7.2. Per capita expenditures, c...

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's article, "Delegation to International Organizations: Agency Theory and World Bank Environmental Reform"~International Organization, Spring 2003!, makes a strong argument for ways in which principal-agent~P-A! models advance theoretical explanations of the behavior and performance of international organizations~IOs!+ Most IOs suffer from widely recognized gaps between their mandates and their performance, gaps not well explained by the major theories in our field+ P-A models are premised on the assumption that performance problems naturally arise when one actor~the principal! delegates to another actor~the agent! the authority to act in the former's interests+ The models seek to explain why and how the divergence of interests between the two parties may result in the agent's actions differing from the principal's intentions, how agents may be better controlled, and the costs of doing so+ The article is a straightforward application of the basic insights of the P-A model to the case of the World Bank's environmental behavior+ The authors want to explain what they identify as sudden and significant environmental reform at the Bank in 1994, after previous Bank reforms fell short of altering its behavior+ The authors argue that the successful reform efforts reflect the convergence of preferences among the Bank's major member state principals, and their use of a variety of screening, oversight, and contracting tools to reduce slippage between their interests and those of the Bank staff agents+ The authors test their model by examining the Bank's environmental behavior from 1980-2000 and use descriptive statistics to assess Bank environmental lending behavior during the same period+ They conclude that a comparison of lending patterns in 1994-2000 with the 1987-93 period shows "significant behavioral changes that stick follow institutional reforms+" 1 Although the article explores important theoretical territory, it contains empirical and methodological problems that seriously undermine its arguments+ In a I would like to thank