International institutions: weak commitments and costly signals

Abstract

As commitment devices, international institutions encourage cooperation by imposing costs on members who do not live up to their commitments. However, the costs that institutions can impose are limited, so that their commitment capacity is weak. Institutions can also impose costs as a condition of membership, allowing them to serve as costly signals. A model of weak commitment and costly signaling leads to a number of hypotheses about patterns of cooperation, institutional membership, and states’ preferences over institutional design. For example, existing members of an institution should impose higherex antecosts when a potential new member could either gain significant benefits from reneging on their commitments in the future, and when the new member expects to gain high benefits from future cooperation. These results are consistent with empirical work on institutions including peacekeeping and the World Trade Organization.