Institutional Diversification of Economic IOs. A Corporate Action Theory Perspective

Why do some IOs in global economic governance differ concerning their institutional complexity and multitude of involved actors? While the G20 evolved as a highly differentiated fora, drawing on a multitude of managed policy fields and involved actors – even down to the inclusion of „involuntary policy makers“ from private business – other international economic fora like the WTO remain statistic concerning their governance mechanisms and state-centric makeup. Formal factors like „institutional relevance“, „power of the respective members“ or „scope of the policy agenda“ do not seem to provide a sufficient explanation for this phenomenon. Drawing on theories of corporate action and international institutions, the contribution argues that global economic institutions tend to broaden in institutional complexity when they lack governance resources or action capabilities in their respective policy field(s). Furthermore it develops a theoretical approach that demonstrates how diversification can lead to greater influence in the respective policy field(s). This hypothesis is subsequently assessed for six international (social-)economic institutions varying in the degree of action capability. Examined are the G-20 and the OECD as fora with high institutional differentiation, the World Bank Group and the G8 with limited institutional differentiation, and the WTO and the IMF largely lacking differentiation. I conclude that increased differentiation may actually lead to a greater impact on the respective policy field(s). These findings may also contribute to a broader debate on institutional differentiation, especially in security studies.