The Politics of Informal Governance

Why do states sometimes use informal instead of formal institutions to govern global problems? Extant research on the forms of institutionalization in world politics focuses on formal modes of cooperation, such as intergovernmental organizations and treaties. Formal rules, however, do not exhaust the institutional variety of international cooperation. They are often inadequate, if not entirely misleading, descriptions of the game that actors play in world politics. Recent work in political science has started to examine informal governance as a mode of cooperation in global governance. In this paper, I examine the factors that lead states to choose between formal intergovernmental organizations, informal intergovernmental organizations, and transnational public-private governance initiatives to structure their interactions and govern global problems. I highlight the political dimensions of informal governance and argue that distributional conflict and power asymmetries are critical for the selection and design of informal modes of international cooperation. States use informal institutions as a means to project power and bias outcomes toward their particularistic interests. Using a new dataset on formal and informal international institutions, I test hypotheses derived from this argument as well as alternative functionalist explanations. Results indicate that power dynamics are a strong driver of the emergence of informal international institutions, while functionalist factors are of less importance.