Delegation to International Organizations: Agency Theory and World Bank Environmental Reform

TLDR

International relations theory inadequately explains IO autonomy and transformation, either overlooking state‑driven deviations or ignoring state roles in reforming IO institutions. The study proposes an agency theory of IOs to fill these explanatory gaps and to resolve issues of common agency and long delegation chains. The model links state–IO interest slippage to institutional mechanisms such as staff selection, monitoring, procedural checks, and contracts, and tests this by analyzing World Bank reforms and lending patterns from 1980 to 2000.

Abstract

Current international relations theory struggles to explain both the autonomy and transformation of international organizations (IOs). Previous theories either fail to account for any IO behavior that deviates from the interests of member states, or neglect the role of member states in reforming IO institutions and behavior. We propose an agency theory of IOs that can fill these gaps while also addressing two persistent problems in the study of IOs: common agency and long delegation chains. Our model explains slippage between member states' interests and IO behavior, but also suggests institutional mechanisms—staff selection, monitoring, procedural checks, and contracts—through which states can rein in errant IOs. We evaluate this argument by examining multiple institutional reforms and lending patterns at the World Bank from 1980 to 2000.