Analysing the rationalistic theory of international regimes by examining common grounds and differences of its main approaches – neoliberalism and neorealism

Term Paper, 2009

12 Pages, Grade: 1,0



1. Introduction

2. The concepts of neoliberalism and neorealism

3. The influence of hegemony on international institutions

4. Prospects for synthesis

5. Conclusion


1. Introduction

When one wants to understand international regimes — their formation, maintenance and breakdown, the best way to begin is to try analysing these aspects by looking at and using theories connected to these specific problems. In our case we have a set of three main theories that are concerned with the wide field of international regimes: interest-based neoliberalism, power-based neorealism and knowledge-based cognitivism. Each of those theories has a unique view of international regimes and the phenomena related to them, although when looked at closer, one notices that they do in fact have several things in common. Of these three, neoliberalism and neorealism are both rooted in and based on the theory of rational choice — that is rationalism. Within the boundaries of rationalism however they do preserve their own interpretations of international regimes. In this essay we will therefore focus on the converging aspects of neoliberalism and neorealism as well as on their differences. Thus in the end it is our goal to show possible ways of how these two rationalistic approaches could be amalgamated so that their advantages may be used in a combined form by future political scientists, not ignoring the difficulties that one faces, when making such an attempt.

2. The concepts of neoliberalism and neorealism

The neoliberal view of the outcome of regime formation procedures is rather optimistic. In their opinion the main actors in world politics are states and therefore when it comes down to regime building, states are the decision-makers. As with individuals in society, states act within a global network of their kind and have a certain interest in achieving gains such as resources, capital or solutions to problems with the help of interstate cooperation. Up to this point there are no differences between the two approaches since neorealism regards states as the main actors in world politics that are interested in gains, too. This is due to the fact that both theories unfold within the sphere of rationalism. The rationalistic approach argues that decisions made by governments are not influenced by domestic issues and events. A state may therefore undergo an internal or domestic transformation over the years and will not be affected in its preferences and decision-making neither in the international system nor within institutions. Hasenclever, Mayer and Rittberger argue: "If preferences are generally assumed not to be amenable to sudden and frequent change this assumption holds specifically for the interaction among states. In rationalist models, interaction (including cooperation) does not affect actors' utility functions or identities [...]. Preferences help to explain interaction but not vice versa. This is another way of saying that rationalist analyses treat states as basically atomistic actors and deny (more often implicitly than explicitly) the existence of an international society [...]."[1]

However, when leaving the rationalistic ground that highlights the similarities of neoliberalism and neorealism and if we are to concentrate on the gains as to observe the expectations related to them and the concerns that arise with them, we do face fundamentally different viewpoints.

Neoliberals who regard themselves als institutionalists — that is people who are generally confident in positive outcomes of regime formation procedures and regard international institutions as important players in world politics — argue that states are concerned with their absolute gains only. So when they expect more gains of a regime than they could acquire by acting on their own, the chances that states will form regimes are seen as very high, because states are in no fear of other states showing aggressions towards them that result from regimes in the first place. On the contrary neorealists are convinced of the importance of relative gains. In an anarchic system like the world we live in states do also look at the gains their regime partners make. That has little to do with jealousy but with the fear of being cheated or betrayed although the value of cooperation is an important factor as well and not be underestimated. Neorealists are so very sensitive to the area a regime is concerned with because it might in the long run affect a states' security. Therefore if an area is directly or indirectly connected to the security and safety of a state then it will be even more interesting to look at the gains the partner has from the cooperation. Hasenclever, Mayer and Rittberger state: "Neoliberals depict states as rational egoists who are concerned only with their own gains and losses. By contrast, realists insist that the utility function of states are (at least) partially interdependent such that the gains from mutual cooperation that a state's partners achieve may diminish considerably the utility of this state and consequently its willingness to cooperate in the first place"[2]

Grieco on the other hand argues: "For realists, international anarchy fosters competition and conflict among states and inhibits their willingness to cooperate even when they share common interests. Realist theory also argues that international institutions are unable to mitigate anarchy's constraining effects on interstate cooperation. Realism, then, presents a pessimistic analysis of the prospects for international cooperation and of the capabilities of international institutions. The major challenger to realism has been what I shall call liberal institutionalism.... The new liberal institutionalists basically argue that even if the realists are correct in believing that anarchy constrains the willingness of states to cooperate, states nevertheless can work together and can do so especially with the assistance of international institutions."[3]

All trade agreements for example are related to security questions since when one gains relatively more capital than another he may invest that capital to increase his military power and later on turn against his former partner up to the point at which the declaration of war stands. Exactly this worst case scenario — your former regime partner declaring war at you in the future due to his higher relative gains in the first place — is the great inhibitor of regime formation in the eyes of neorealists. To sum up the arguments made up until now, neoliberals highlight the fear of being cheated on while neorealists care most about the worst case scenario. Grieco concludes: "Realism, then, finds that there are at least two major barriers to international cooperation: state concerns about cheating and state concerns about relative achievements of gains. Neoliberal institutionalism pays attention exclusively to the former, and is unable to identify, analyze, or account for the latter."[4]

Due to the assumption that an attack of your former partner is one of the possible outcomes of a regime, neorealists argue that regime formation in the first place is a rather unlikely or at least difficult process. They accuse the neoliberals of not taking the anarchic system into account as much as they do themselves and therefore misinterpret the chances of regime building. In fact neoliberals do not even agree upon the possibility that your present partner may become your foe in the near future. Naturally such sheer ignorance does not make it easy for neorealists to have a productive discussion on the regime formation process with their rationalistic counter-theorists. When referring to Grieco, the point that was intended to be made becomes more clear: "[...], neoliberal institutionalism misconstrues the realist analysis of international anarchy and therefore it misunderstands the realist analysis of the impact of anarchy on the preferences and actions of states. Indeed, the new liberal institutionalism fails to address a major constraint on the willingness of states to cooperate, which is generated by international anarchy and which is identified by realism. As a result, the new theory's optimism about international cooperation is likely to be proven wrong."[5] On the other hand, realists tend to ignore the possibility of institutions to serve as a valuable part in solving conflicts between states that could result in war. So if realists only look at institutions in a way that they might make the cooperating states more powerful than the non-cooperating states, an important feature of institutions is forgotten, because they may also be formed for informative purposes such as providing both partners with the specific information that is necessary for them to trust each other and not wage themselves in false fears of an upcoming war. The provision of information only does not by itself solve the problem of relatively unfair payoffs to the cooperating states since it cannot help solving the inequality. So if the fear of being treated unfair is considered and included in the contracts of the regime, when it is being established in the first place, arrangements can be made that provide states with an option to equalise the gains. Hasenclever, Mayer and Rittberger argue: "As regards gaps in gains, international regimes (as, for example, GATT) often include stipulations providing for differential treatment of weaker partners who are less well able to exploit the opportunities resulting from regime-based cooperation. Regimes may also serve as institutional frameworks to facilitate the arrangement of side-payments to improve the relative performance of otherwise dissatisfied actors. The regular review conferences prescribed by the procedural component of many regimes allow relatively disadvantaged states to voice their concerns about skewed distribution of gains and to push for corrections."[6] Even though the supporters of neither approach claim their theory to be perfectly matched by reality, when one looks for mere empirical evidence for the neorealistic view the outcome of that search is rather fruitful. Throughout the last centuries states have cooperated with one another on countless issues and occasions.

The Hitler-Stalin Pact may serve as a prominent example to confirm the fears of neorealists who emphasise the chance of a friend turning into a foe. Neoliberalists might argue that this arrangement is not an international regime in terms of a modern definition and because it is was formed in times of war - nonetheless one can derive the arguments neorealists make. Neoliberals, however, do not completely ignore the negative effects that an anarchic system has on the regime formation process, but still find arguments for their optimism. The prevalent problematic (game-theoretic) situation states find themselves in is the Prisoner's Dilemma.


[1] HASENCLEVER, A., MAYER, P. & RITTBERGER, V. (1997) Theories of international regimes. Cambridge, Cambridge University Press, p. 25.


[3] GRIECO, J. M. (2000) Anarchy and the Limits of Cooperation. In ART, R. J. & JERVIS, R. (Ed s.) International Politics. Enduring Concepts and Contemporary Issues. New York, Longman., p. 70.

[4] GRIECO, J. M., p.71.

[5] GRIECO, J. M., p. 70-71.


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Analysing the rationalistic theory of international regimes by examining common grounds and differences of its main approaches – neoliberalism and neorealism
University of Bamberg  (Lehrstuhl für Internationale Beziehungen)
International Institutions
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ISBN (Book)
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Neoliberalismus, Neorealismus, Kognitivismus, Rationalismus, Rational Choice, Internationale Organisation, Internationale Institution, Regime, Anarchie, Kooperation, Internationale Beziehungen
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Jakob Weber (Author), 2009, Analysing the rationalistic theory of international regimes by examining common grounds and differences of its main approaches – neoliberalism and neorealism, Munich, GRIN Verlag,


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