Skip to main content

Theory of Plutocratic Delegation

  • Chapter
Regional Integration
  • 156 Accesses

Abstract

My dependent variable is plutocracy, a type of governance structure that states sometimes use for economic integration. While two other structures—intergovernmental and supranational—are well known to scholars of integration, plutocracy—rule by the wealthy—has been overlooked. Under this third structure, members of the integration accord delegate policy making to the wealthiest state among them. My theory of plutocratic delegation, developed in this chapter, identifies five necessary conditions for plutocracy.

This is a preview of subscription content, log in via an institution to check access.

Access this chapter

Chapter
USD 29.95
Price excludes VAT (USA)
  • Available as PDF
  • Read on any device
  • Instant download
  • Own it forever
eBook
USD 39.99
Price excludes VAT (USA)
  • Available as PDF
  • Read on any device
  • Instant download
  • Own it forever
Hardcover Book
USD 54.99
Price excludes VAT (USA)
  • Durable hardcover edition
  • Dispatched in 3 to 5 business days
  • Free shipping worldwide - see info

Tax calculation will be finalised at checkout

Purchases are for personal use only

Institutional subscriptions

Preview

Unable to display preview. Download preview PDF.

Unable to display preview. Download preview PDF.

Notes

  1. Ronald H. Coase, “The Nature of the Firm,” Economica 16, no. 4 (1937): 386–405; “The Problem of Social Cost,” Journal of Law and Economics 3, no. 1 (1960): 1–44,

    Article  Google Scholar 

  2. Friedrich A. von Hayek, “The Use of Knowledge in Society,” American Economic Review 35 (1945): 519–30; and Studies in Philosophy, Politics, and Economics (Chicago: Chicago University Press, 1967).

    Google Scholar 

  3. Adding to the confusion, another intellectual approach is called Neo-Institutional Economics. The leaders of neo-institutionalism include John K. Galbraith, Clarence Ayres, and Adolph Lowe. For a discussion on this approach, see Allan G. Gruchy, Contemporary Economic Thought: The Contribution of Neo-Institutional Economics (Clifton, NJ: Augustus M. Kelley, 1972).

    Google Scholar 

  4. For example, see Beth V. Yarbrough and Robert M. Yarbrough, Cooperation and Governance in International Trade: The Strategic Organizational Approach (Princeton, NJ: Princeton University Press, 1992);

    Book  Google Scholar 

  5. Benjamin J. Cohen, The Geography of Money (Ithaca: Cornell University Press, 1998);

    Google Scholar 

  6. David A. Lake, Entangling Relations: American Foreign Policy in Its Century, Princeton Studies in International History and Politics (Princeton, NJ: Princeton University Press, 1999);

    Google Scholar 

  7. Katja Weber, Hierarchy Amidst Anarchy: Transaction Costs and Institutional Choice, Suny Series in Global Politics (Albany, NY: State University of New York Press, 2000);

    Google Scholar 

  8. and Kathleen J. Hancock, “Surrendering Sovereignty: Hierarchy in the International System and the Former Soviet Union” (Dissertation, Ph.D., University of California, San Diego, 2001).

    Google Scholar 

  9. Terry M. Moe, “The New Economics of Organization,” American Journal of Political Science 28 (1984): 756.

    Article  Google Scholar 

  10. For recent developments, see Michael J. Tierney, “Delegation Success and Policy Failure: Collective Delegation and the Search for Iraqi Weapons of Mass Destruction,” Law and Contemporary Problems 71, no. 1 (2008): 283–312;

    Google Scholar 

  11. Curtis A. Bradley and Judith G. Kelley, “The Concept of International Delegation,” Law and Contemporary Problems 71, no. 1 (2008): 1–36;

    Google Scholar 

  12. Darren G. Hawkins et al., eds., Delegation and Agency in International Organizations (Cambridge, UK: Cambridge University Press, 2006);

    Google Scholar 

  13. Alexander Thompson, “Screening Power: International Organizations as Informative Agents,” in Delegation and Agency in International Organizations, ed. Darren G. Hawkins, et al. (Cambridge, UK: Cambridge University Press, 2006);

    Google Scholar 

  14. Mark A. Pollack, The Engines of European Integration : Delegation, Agency, and Agenda Setting in the EU (Oxford and New York: Oxford University Press, 2003);

    Book  Google Scholar 

  15. and Daniel L. Nielson and Michael J. Tierney, “Delegation to International Organizations: Agency Theory and World Bank Environmental Reform,” International Organization 57, no. 2 (2003): 241–76.

    Article  Google Scholar 

  16. Bruce Bueno de Mesquita et al., The Logic of Political Survival (Cambridge, MA, and London: The MIT Press, 2003), 38.

    Google Scholar 

  17. Darren G. Hawkins et al., “Delegation under Anarchy: States, International Organizations, and Principal-Agent Theory,” in Delegation and Agency in International Organizations, ed. Darren G. Hawkins, et al. (Cambridge: Cambridge University Press, 2006), 7.

    Chapter  Google Scholar 

  18. Alec Stone Sweet and Wayne Sandholtz, “Integration, Supranational Governance, and the Institutionalization of the European Polity,” in European Integration and Supranational Governance, ed. Wayne Sandholtz and Alec Stone Sweet (Oxford and New York: Oxford University Press, 1998), 8.

    Google Scholar 

  19. Darren G. Hawkins and Wade Jacoby, “How Agents Matter,” in Delegation and Agency in International Organizations, ed. Darren G. Hawkins, et al. (Cambridge: Cambridge University Press, 2006); Nielson and Tierney, “Delegation to International Organizations”; and Thompson, “Screening Power.”

    Chapter  Google Scholar 

  20. Mark A. Pollack, “Delegation and Discretion in the European Union,” in Delegation and Agency in International Organizations, ed. Darren G. Hawkins, et al. (Cambridge, UK Cambridge University Press, 2006).

    Google Scholar 

  21. Robert Shuman, the architect of the EU’s genesis organization, the European Coal and Steel Community, originally wanted the “High Authority,” which later became the Commission, to have much stronger supranational powers. For a discussion of the High Authority’s formation, see Berthold Rittberger, “Which Institutions for Post-War Europe? Explaining the Institutional Design of Europe’s First Community,” Journal of European Public Policy 8 (2001): 673–708.

    Article  Google Scholar 

  22. Andrew P. Cortell and Susan Peterson, “Dutiful Agents, Rogue Actors, or Both? Staffing, Voting Rules, and Slack in the WHO and WTO,” in Delegation and Agency in International Organizations, ed. Darren G. Hawkins, et al. (Cambridge, UK: Cambridge University Press, 2006).

    Google Scholar 

  23. For a comparison of dispute settlement mechanisms, see James McCall Smith, “The Politics of Dispute Settlement Design: Explaining Legalism in Regional Trade Pacts,” International Organization 54, no. 1 (2000): 137–80;

    Article  Google Scholar 

  24. and Daniel Y. Kono, “Making Anarchy Work: International Legal Institutions and Trade Cooperation,” Journal of Politics 59, no. 3 (2007): 746–59.

    Google Scholar 

  25. For a principal-agent analysis of the EU’s supranational organizations, see Pollack, Engines of European Integration. For an overview of all the EU’s institutions, see Desmond Dinan, Ever Closer Union: An Introduction to European Integration (Boulder: Lynn Rienner, 2005), Part II.

    Google Scholar 

  26. For a persuasive account of how the European Court of Justice became so powerful, see Karen J. Alter, “Who Are the ‘Masters of the Treaty’? European Governments and the European Court of Justice,” International Organization 52, no. 1 (1998): 121–47; and Establishing the Supremacy of European Law: The Making of an International Rule of Law in Europe (New York: Oxford University Press, 2001).

    Article  Google Scholar 

  27. For an argument about how EU leaders inadvertently tied their own hands, see Paul Pierson, “The Path to European Integration: A Historical Institutionalist Analysis,” Comparative Political Studies 29, no. 2 (1996): 123–63.

    Article  Google Scholar 

  28. Barbara Koremenos, “When, What, and Why Do States Choose to Delegate?” Law and Contemporary Problems 71 (2008): 155.

    Google Scholar 

  29. Alexander J. Motyl, Imperial Ends: The Decay, Collapse, and Revival of Empires (New York: Columbia University Press, 2001).

    Google Scholar 

  30. For some of the more prominent work on rational choice approaches in political science and the early debates about their utility, see Jon Elster, The Cement of Society : A Study of Social Order (Cambridge, UK, and New York: Cambridge University Press, 1989);

    Book  Google Scholar 

  31. Donald P. Green and Ian Shapiro, Pathologies of Rational Choice Theory: A Critique of Applications in Political Science (New Haven: Yale University Press, 1994);

    Google Scholar 

  32. James G. March and Herbert Alexander Simon, Organizations (New York: Wiley, 1958);

    Google Scholar 

  33. and Kenneth A. Shepsle and Mark S. Bonchek, Analyzing Politics: Rationality, Behavior, and Institutions (New York and London: W.W. Norton and Company, 1997).

    Google Scholar 

  34. Herbert Alexander Simon, Administrative Behavior; a Study of Decision-Making Processes in Administrative Organization, 2nd ed. (New York: Macmillan, 1957);

    Google Scholar 

  35. Oliver E. Williamson, Markets and Hierarchies, Analysis and Antitrust Implications: A Study in the Economics of Internal Organization (New York: Free Press, 1975);

    Google Scholar 

  36. and Douglas C. North, “Structure and Performance: The Task of Economic History ” Journal of Economic Literature 16, no. 3 (1978): 963–78.

    Google Scholar 

  37. James D. Morrow, Game Theory for Political Scientists (Princeton, NJ: Princeton University Press, 1994), 19.

    Google Scholar 

  38. Interview with NTV, Moscow, June 12, 1994, as reported in Taras Kuzio, Russia-Crimea-Ukraine: Triangle of Conflict (London: Research Institute for the Study of Conflict and Terrorism, 1994), 41.

    Google Scholar 

  39. Bueno de Mesquita et al., Logic of Political Survival, 38–55. The authors refer to three groups, with the coalition as a subset of selectorate. However, since each group is a subset of the one before it—the selectorate is a subset of all residents, and so on—I refer to these as four rather than three groups. For the original use of “selectorate,” see Philip G. Roeder, Red Sunset: The Failure of Soviet Politics (Princeton, NJ: Princeton University Press, 1993);

    Google Scholar 

  40. and Susan Shirk, The Political Logic of Economic Reform in China (Berkeley: University of California Press, 1993).

    Google Scholar 

  41. Interestingly, empirical research suggests that states of relative equality rarely succeed in forming their own integration accords. For example, in the 1800s, several southern German states of equal wealth attempted to form their own customs union; it failed. Similarly, the Central Asian states after the collapse of the Soviet Union considered their own accord, which would have included Kazakhstan and Uzbekistan, states of relatively equal wealth. The newly independent southern African states also considered their own accord. None of these agreements materialized. See also Walter Mattli, The Logic of Regional Integration: Europe and Beyond (Cambridge, UK, and New York: Cambridge University Press, 1999).

    Book  Google Scholar 

  42. J. Clark Leith and John Whalley, “Competitive Liberalization and the US-SACU FTA,” in Free Trade Agreements: U.S. Strategies and Priorities, ed. Jeffrey J. Schott (Washington, D.C.: Institute of International Economics, 2004), 335–36.

    Google Scholar 

  43. Lawrence B. Krause, European Economic Integration and the United States (Washington, D.C.: Brookings Institution, 1968);

    Google Scholar 

  44. Harry G. Johnson, “The Gains from Free Trade with Europe: An Estimate,” Manchester School of Economic and Social Studies 26 (1958), “The Trade Effects of EFTA and the EEC, 1959–1967” (Geneva: EFTA Secretariat, 1972), and “The Effect of EFTA on the Economies of Member States,” (Geneva: EFTA Secretariat, 1969);

    Google Scholar 

  45. and Bela A. Balassa, “Trade Creation and Trade Diversion in the European Common Market,” The Economic Journal 77, no. 305 (1967): 1–21.

    Article  Google Scholar 

  46. Oliver E. Williamson, The Economic Institutions of Capitalism: Firms, Markets, Relational Contracting (New York and London: Free Press and Collier Macmillan, 1985).

    Google Scholar 

  47. For a summary of the arguments that Russia is neo-imperialist or post-imperialist, or something else, see Celeste A. Wallander, “Russian Transimperialism and Its Implications,” The Washington Quarterly 30, no. 2 (2007): 107–22.

    Article  Google Scholar 

  48. Rawi Abdelal, National Purpose in the World Economy: Post-Soviet States in Comparative Perspective (Ithaca: Cornell University Press, 2001).

    Google Scholar 

Download references

Authors

Copyright information

© 2009 Kathleen J. Hancock

About this chapter

Cite this chapter

Hancock, K.J. (2009). Theory of Plutocratic Delegation. In: Regional Integration. Palgrave Macmillan, New York. https://doi.org/10.1057/9780230101913_3

Download citation

Publish with us

Policies and ethics