Compliance And Reputation In The International Relations

Legalization and institutionalization have been showing potent sways on contemporary international relations, and rule-based global governance system comes into being in a multitude of world affairs. Whether or not states complied with these rules? Why, if they comply? Inasmuch that these questions seem to be significant in theoretical and practical meaning, relevant enquiry may contribute to understanding the effectiveness or performance of international institutions.This dissertation integrates state’s commitment to and compliance with international rules into a two-stage framework:commitment exists as a statement on ex post behavior, while compliance emerges as fulfillment on ex ante commitment. I will argue that reputation is an important mechanism to incline states toward deference. Violations will invite a bad reputation qua an unfaithful contract-partner and hurt violator’s future ability to credible commitment. Consequently, states have to make trade-off between short-term gains from defect and long-term gains from good compliance-record, for the sake of maintaining an acceptable reputation. In this way, reputation mechanism enhances states’ compliance willingness.While operates on inter-state level, however, reputation mechanism may also works on intra-state panel via so-called "domestic audience cost." Some researchers espouse "theory of democratic compliance," which maintains democracies have better capabilities in making credible commitments and keeping good compliance records, by the reason that decision-makers in these countries, vis-a-vis their counterparts in authoritarian states, face higher "domestic audience cost." Such hypothesis, this dissertation argues, overlooks a pivotal boundary condition, that is, electorate tends to support state’s compliance with international rules. Such an assumption, however, not necessarily holds. Accordingly, it is imperative that researchers investigate voters’ policy preferences in a given substantive issue, in the light of domestic distributive consequences of compliance decision.In order to control so-called "endogeneity problem" and identify constraining effect on state behavior of commitment per se, this dissertation selects sovereign debt as cases. Compliance means repayment service as contracted. In real-world sovereign debt practices, I find four frequent behavioral patterns:1) sovereign defaulters are excluded from international capital market;2) when re-accessing to market, defaulters have to make offers with higher interest rate;3) states with uncertain or tainted reputation resort to self-binding contractual terms so as to persuade potential lenders;4) creditors establish collective action arrangements to activate reputation mechanism. All of these empirical findings appear consistent with theoretical predictions of reputation hypothesis, and suggest reputation mechanism significantly contributes to state’s faithful repayment or compliance.More often than not, electorate doesn’t support faithful debt repayment. Due to their low saving rates in developing countries, external debt accounts for the lion share of government debts. When macro-economic fundamental goes from bad to worse and hence when debt-service issue becomes salient, repayment entails, inter alia, increasing tax and/or cutting social welfare expenditure, which strikes a blow against the broad social strata. Empowered with ballots to decide politician’s political survival, the median voter will punish the decision-maker who advocates debt-service. For this reason, developing democracies tend to more default on their sovereign debts than authoritarian states. Two comparative cases support this finding. The first involves the systemic changes of Argentine voters’ behavior from1999to2001. The second compares the notably distinctive compliance-records on financial stability packages between nascent democratic Peru and military dictatorship in Chile. This finding suggests that, while investigating causal impact of regime type on compliance-record, researchers should take into account domestic distributive consequences of international rules."Theory of democratic compliance," as a universal judgment, should not be applied without certain boundary conditions.