A theory of emerging order within institutional complexes: How competition among regulatory international institutions leads to institutional adaptation and division of labor

This article introduces, summarizes and contextualizes the key questions and findings of a special issue of Global Policy on the resourcing of international organizations (IOs). The article sets out trends in the financial resources available to IOs; discusses their organizational consequences; and highlights analytical implications for the study of IOs. We discuss resource diversification associated with growing complexity of the origins and types of funding available to IOs; the importance of non-state actors in IO funding; and contestation over the classification of resources. Resource diversification encourages organizational differentiation, manifested in major shifts in resource-related actor constellations and their impact on the autonomy of IOs; adjustments to budgeting procedures; and functional differentiation within IOs and the emergence of new types of IOs that are partly driven by resourcing. These observations invite an analytical perspective in the study of IOs that pays systematic attention to the administrative governance dimension of IOs; the entrepreneurial character of many IOs; and organizational fields as a focus of analysis. Read together, the 11 contributions to the special issue underline that paying attention to their resourcing can advance our understanding of IOs.At a time when newly elected US President Donald Trump announces severe budget cuts to the United Nations system, the relevance of resourcing for the functioning of international organizations (IOs) can be in no doubt. It has long been recognized that access to financial and other resources is critical to the evolution of IOs and to the realization of their global policy ambitions (Wright, 1957). Complaints from the leadership of IOs about inadequate resources also have a long tradition, and the mismatch between IO mandates, as set by member states, and available resources to carry out those mandates effectively is a recurrent concern (see Annan, 1993, for the UN). Some IOs, such as the African Union (Engel, 2015) or UNRWA (Bocco, 2010) appear to suffer from chronic underfunding. Others have a long history of repeated funding 'crises', typically brought about by either the unexpected partial withholding of member state contributions (for the United Nations see Claude, 1964;Taylor, 1991; for UNESCO see H€ ufner, 2017;. In other cases, resource mismatch has been the result of unforeseen demands on IO budgets, as in the case of refugee crises or natural or man-made disasters (McDermott, 2000). In view of these challenges, the need to reform UN financing and resource politics has been recognized and many proposals have been put forward over the years (see Muttukumaru, 2016 for a present-day reform proposal).A central finding of this special issue is that there are several critical issues that matter when studying the resourcing of IOs, beyond the overall levels of funding available and the details of resource allocation. Among these issues are:(1) the mix of sources of funding, namely, who provides the finances of IOs; (2...

Section: An Administrative Governance Perspectivementioning

confidence: 99%

Resourcing International Organizations: Resource Diversification, Organizational Differentiation, and Administrative Governance

Goetz

Patz

2017

“…Functional overlap can lead to cooperation resultant from a division of labour among institutions, in turn linked to the members of a particular institution having an interest in a particular division or labour. This fosters institutional adaptation to achieve the desired complementarities (Gehring and Faude, ). Instead of turning to forum shopping, as much current literature assumes, members of two or more institutions with functional overlap will seek to maximise their participation in multiple institutions.…”

Section: Theoretical Framework and Methodologymentioning

confidence: 99%

“…Instead of turning to forum shopping, as much current literature assumes, members of two or more institutions with functional overlap will seek to maximise their participation in multiple institutions. They do so by pressing for adaptation and concomitant division of labour, as the case of agricultural GMOs illustrates (Gehring and Faude, ).…”

Section: Theoretical Framework and Methodologymentioning

confidence: 99%

Rise of Complementarity between Global and Regional Financial Institutions: Perspectives from Asia

Rana¹,

Pardo

2018

Global economic governance is in flux. The institutions and norms set up by the US and other Western powers decades ago are being eroded. Regional organisations and emerging powers are challenging them. This is especially the case in East Asia and China. Or are they? In this article we argue that East Asian countries in general and China in particular are not challenging existing global institutions and norms. Instead, they are setting up and developing institutions that complementrather than compete againstexisting institutions. Even though there is a degree of 'healthy' competition between regional institutions and their global counterparts, the former are essentially complementary to the latter. Global institutions can offer knowledge and capacity building to regional institutions, which in turn can provide access to a larger pool of resources. To prove our argument, we analyse the cases of liquidity provisionin the form of the IMF and the Chiang Mai Initiative Multilateralisation and development financingwith the World Bank on the one hand and the Asian Infrastructure Investment Bank and the New Development Bank on the other. Our findings suggest that the multi-layering of international governance need not lead to competition between layers. Policy Implications• Regional financial and development financing institutions complement their global counterparts. • Global institutions can offer knowledge and capacity-building to regional institutions, which in turn provide access to a larger pool of resources.• A degree of 'healthy' competition is beneficial by promoting reform and increasing the supply of public goods.• Global and regional institutions should not engage in a race to the bottom. • East Asia and China are not challenging existing global institutions.• The IMF and ASEAN+3 should develop more structured and systematic cooperation. • The World Bank and the ADB should strengthen cooperation with new, China-led development banks.Global Policy (2018) 9:2

“…On the other hand, by recurring to an agency with similar duties, they also induced competition for the World Trade Organization and increased its incentives to be more responsive to their own preferences. In general, ‘functional overlap’ serves to induce competition between rival agencies, challenging their respective ‘bureaucratic monopolies’ (Gehring and Faude, ). While hopes are that competition increases performance, it is also possible that the adoption of new legal provisions undermine the original arrangements (Shaffer and Pollack, ).…”

Section: Theoretical Perspectives: State Influence At International Omentioning

confidence: 99%

Trust Funds as a Lever of Influence at International Development Organizations

Reinsberg

2017

Trust funds -broadly defined as financial vehicles to channel development funding earmarked for specific purposes through international development organizations -have grown substantially over the past two decades. Reflecting the variety of trust fund purposes and related governance arrangements, an emergent literature emphasizes a diversity of reasons underlying this growth. This paper proposes a simple -yet encompassing -explanation applicable to all kinds of funds: donors use trust funds to wield 'influence' -leveraging financial resources to alter the policies of multilateral organizations. Based on interviews at the World Bank, the study shows that influence is a dominant motive behind trust funds, though the capacity and willingness to wield influence varies across donors. Influence is a salient motive especially for medium-sized donors and emerging donors but surprisingly less so for large donors. In addition, attempts of influence are most effective when donors promote new thematic issues that did not previously feature Bank assistance and outside established programs. Concerns among stakeholders about undue donor influence are highest with respect to the global knowledge work of the World Bank but are virtually absent when involving donors in the operational activities at the country level. Policy Implications• Policy-makers need to be aware that trust funds are prone to be used as levers of influence.• Donor involvement in multilateral agency operations can enhance the effectiveness of operations but at the same time undermine the legitimacy of global governance; stakeholders must find a balance between these two considerations.• International development organizations should have clear guidelines regarding which kinds of donor involvement they can accept and which practices of involvement are incommensurate with their own procedural rules; they must communicate these guidelines internally and vis-a-vis external stakeholders.• Sectors that are prone to undue influence -for example global knowledge work -should be financed from core contributions.