generally, which began in the early 1980 s. Prior to this time, the study of IOs was
quite policy-oriented and descriptive, lacking an overarching analytical framework
(Martin and Simmons 1998 ). This lack of a theoretical foundation meant that,
although individual studies generated strong insights, they did not cumulate to
create a coherent picture of or debate about the role of IOs in the world economy.
This situation changed with the publication of an edited volume calledInter-
national Regimes(Krasner 1983 ) and of Robert Keohane’s bookAfter Hegemony
(Keohane 1984 ). These books cast international institutions in a new light and
suggested a novel explanatory framework for studying them. The puzzle that
motivated this research began with two observations: That international economic
cooperation in the 1970 s was stable in spite of substantial shifts in the distribution
of international economic power, and that organizations such as the Bretton
Woods institutions and the GATT were prominent features of the economic
landscape. Keohane and others argued that these two observations were connected
to one another, and that the existence of institutions and IOs explained the
persistence of economic cooperation.
The fundamental logic of this line of work is summarized in Keohane ( 1982 ).
In order for states to cooperate, they must overcome a range of collective-action
problems. No external enforcement exists in the international economy, so any
agreements must be self-enforcing. This means that states mustWnd ways to
avoid temptations to cheat, for example by reneging on agreements to encourage
trade by erecting protectionist barriers. Avoiding such temptations requires high-
quality information about the actions and preferences of other states, and about
the likely consequences of cheating on agreements. In addition, states must
coordinate their actions, for example agreeing on common technological and
public-health standards. IOs provide forums in which states can mitigate collect-
ive-action problems that threaten stable patterns of cooperation. IOs can per-
form monitoring functions, providing assurance that others are living up to the
terms of their commitments. They are forums for negotiating to resolve coord-
ination problems, and to learn about the preferences and constraints facing other
governments. They create structures for enforcement and dispute resolution,
although actual enforcement powers typically remain in the hands of member
states.
Through these functions, IOs become a valuable foundation for cooperation and
for the global economy. Thus patterns of cooperation can be more resilient in the
face of underlying shifts in economic power and interests. The initial work
applying this ‘‘contractual’’ view of institutions concentrated on international
regimes, deWned as sets of principles, norms, rules, and decision-making proced-
ures (Krasner 1982 ). One advantage of examining regimes, as compared to the
earlier focus on individual IOs, is that this shift allowed researchers to consider
informal institutions as well as formalized bodies. While in more recent years much
attention has shifted back to formal IOs, the understanding that informal bodies of
656 lisa l. martin