Explaining the Non-Proliferation Regime: Anomalies for Contemporary International Relations Theory

Explaining the Non-Proliferation Regime: Anomalies for Contemporary InternationalRelations TheoryAuthor(s): Roger K. SmithSource: International Organization, Vol. 41, No. 2 (Spring, 1987), pp. 253-281Published by: The MIT PressStable URL: http://www.jstor.org/stable/2706662 .

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Explaining the non-proliferation regime: anomalies for contemporary international relations theory Roger K. Smith

Academic fashion in the discipline of international relations has turned in the last few years to the study of "regimes." A commonly accepted definition of international regimes is a set of implicit or explicit "principles, norms, rules and decision-making procedures around which actor expectations converge in a given issue-area."'1 Following from this definition, a wide range of au- thors have proceeded to identify regimes in such issue-areas as money, trade, oceans, food, and environment. However, little scholarly analysis has been devoted to the study of regimes in the domain of security, as opposed to the field of international political economy. One of the principal excep- tions to this general rule, the recent and original work of Robert Jervis, suggests that this dearth of scholarly study is not the result of neglect, but rather, inherent in the nature of the subject. There is little security regime analysis because there are currently no security regimes; regimes are more difficult to establish in the security area than in the economic realm because of the inherently competitive cast of security concerns, the unforgiving nature of the problems, and the difficulty in determining how much security the state has or needs (the area of nuclear armaments demonstrates how subjec- tive the latter consideration can become).2 Nevertheless, the term "regime"

1. Stephen D. Krasner, "Structural Causes and Regime Consequences: Regimes as Interven- ing Variables," in Krasner, ed., International Regimes (Ithaca: Cornell University Press, 1983), p. 1. The book contains all the articles originally published in the journal International Organi- zation 36 (Spring 1982). Subsequent citations will be to the book rather than the special issue of the journal. For a recent critique of regime analysis, see Friedrich Kratochwil and John Gerard Ruggie, "International Organization: A State of the Art on an Art of the State," International Organization 40 (Autumn 1986), pp. 753-75.

2. Robert Jervis, "Security Regimes," in Krasner, ibid., pp. 173-195. See also two other related works by Jervis: "Cooperation Under the Security Dilemma," World Politics 31 (Janu- ary 1978), pp. 167-186; and "From Balance to Concert: A Study of International Security Cooperation," World Politics 38 (October 1985), pp. 58-78. Also see Stephen Van Evera, "Why Cooperation Failed in 1914," World Politics 38 (October 1985), pp. 80-117; and George W. Downs et al., "Arms Races and Cooperation," World Politics 38 (October 1985), pp. 118-146.

International Organization 41, 2, Spring 1987 C) 1987 by the World Peace Foundation and the Massachusetts Institute of Technology



254 International Organization

is increasingly appended to the term "non-proliferation" to describe the system of cooperation concerning the "horizontal" spread of nuclear weapons.3 Thus, the first question that this essay will seek to answer is whether common policy assumption and usage can be reconciled with scholarly definition.

The second question addresses theory. While it has been relatively easy to prove the empirical existence of regimes in economic areas, the theoretical task of explaining regime formation and maintenance within traditional international relations theory has been notably unsuccessful. A recent reformula- tion of the traditional state-centric power politics paradigm is the theory of hegemonic stability. Greatly simplified, the theory states that the presence of a single, preeminent state will lead to the emergence of regimes that benefit not only itself, but all the states in the system; in essence, a hegemon will force the system toward a point of Pareto-optimality by providing public goods, most notably a system of order. Conversely, the absence or decline of hegemon will lead to disorder and other undesirable outcomes for the system of states. The novelty of the theory is that it stands conventional or intuitive logic about hegemony on its head; instead of claiming that hegemony is exploitative and only to the benefit of the hegemon, the theory argues that hegemony is widely beneficial.4 Thus, the second question that this essay seeks to answer is whether the theory of hegemonic stability adequately explains the formation and existence of a "nuclear non- proliferation regime."

The third question, like the second, involves theoretical considerations. A call has gone out to scholars in the field of international relations to link, in a "formally rigorous way or an empirically comprehensive way," the ''upward-looking theory of strategy with the downward-looking theory of

3. Some of the recent literature on non-proliferation in which a "regime" is presumed to exist includes: Joseph S. Nye, "Maintaining the Non-Proliferation Regime," International Organization 35 (Winter 1981), pp. 15-38; William C. Potter, Nuclear Power and Proliferation: An Interdisciplinary Approach (Cambridge, Mass.: Oelgescher, 1982); Robert L. Beckman, Nuclear Non-Proliferation: Congress and the Control of Peaceful Nuclear Activities (Boulder: Westview, 1985); Jed C. Snyder and Samuel F. Wells, eds., Limiting Nuclear Proliferation (Cambridge, Mass.: Ballinger, 1985); and Rodney W. Jones et al., The Nuclear Suppliers and Non-Proliferation: International Policy Choices (Lexington, Mass.: Lexington, 1985).

4. The definition of the theory of hegemonic stability used in this article draws largely from the work of Robert 0. Keohane, who has given the theory its intellectual prominence through his criticisms and revisions. See Keohane and Joseph S. Nye, Power and Interdependence: World Politics in Transition (Boston: Little Brown, 1977), pp. 38-53; Keohane, "The Theory of Hegemonic Stability and Changes in International Economic Regimes," in Ole R. Holsti et al., eds., Change in the International System, (Boulder: Westview, 1980), pp. 131-162; Keohane, "The Demand for International Regimes," in Krasner, International Regimes, pp. 141-172; and Keohane, After Hegemony: Cooperation and Discord in the World Political Economy (Princeton: Princeton University Press, 1984). For a sophisiticated, historically-based theory of why hegemons decline, see Robert Gilpin, War and Change in World Politics (Cam- bridge: Cambridge University Press, 1982). A recent article that critiques the theory of hegemonic stability in rigorous detail is Duncan Snidal, "The Limits of Hegemonic Stability Theory," International Organization 39 (Autumn 1985) pp. 579-614.



Non-proliferation regime 255

regimes."5 There has been, thus far, one serious effort to link theories concerning the "demand" of regimes with their "supply": the functional theory of regimes.6 The functional theory of regimes combines the "upward- looking" theory of games with the "downward-looking" theory of public goods and market failure. Basically, the theory argues that under conditions of "political market failure" there are incentives for states to pursue their self-interest rationally and egoistically by creating a regime. This regime gives a sense of legal liability, reduces transaction costs, and corrects infor- mational imperfections around a cluster of issues. A regime, according to the functional theory, will facilitate mutually beneficial agreements on those issues. The functional theory has only been applied to the international economic regimes of trade, money, and oil. Thus, the third question ex- plores the functional theory when applied to the "nuclear non-proliferation regime."

This essay contends that the system of international cooperation over non-proliferation does constitute a regime, but that such a regime presents a serious anomaly for contemporary international relations theory in explaining both its formation and maintenance, despite recent modifications. This article concludes that the theory of hegemonic stability and the functional theory cannot adequately explain the nuclear non-proliferation regime; both theories suffer from premature exhaustion in their search for independent variables to explain regimes. What needs to be considered, in addition to power and egoistic self-interest, is knowledge and the process by which states "learn." This article does not explore the myriad technical and political issues that are of considerable importance in the broader problem of preventing proliferation, (problems such as the use of plutonium as a civilian nuclear fuel, or the question of so-called "second-tier" suppliers, including Argentina, Brazil, and South Africa).7 Rather, I focus on a balanced theoretical understanding of the nuclear non-proliferation regime and the implications of such an understanding for international relations theory.

5. Robert Axelrod and Robert 0. Keohane, "Achieving Cooperation under Anarchy: Strate- gies and Institutions," World Politics 38 (October 1985), pp. 252-253.

6. Keohane, After Hegemony, pp. 85-109; see also Keohane, "The Demand for Interna- tional Regimes." For two thoughtful reviews of the functional theory, see Oran R. Young, "International Regimes: Toward a New Theory of Institutions," World Politics 39 (October 1986), p. 104-122; and James N. Rosenau, "Before Cooperation: Hegemons, Regimes, and Habit-Driven Actors in World Politics," International Organization 40 (Autumn 1986), pp. 849- 894.

7. See note 3 for current literature that addresses these issues in depth. For recent reviews of the 1985 Nuclear Non-Proliferation Treaty Review Conference, see the following articles in Arms Control Today 15 (October 1985): Lewis A. Dunn, "Standing up for the NPT"; Charles N. Van Doren, "Outlook Brightens for the NPT Regime"; and Leonard S. Spector, "Unfinished Business at the NPT Review." See also Mitchell Reiss, "Beyond the 1985 NPT Review Conference," Survival 27 (September/October 1985); and Lewis A. Dunn, "Building on Success: the NPT at Fifteen," Survival 28 (May/June, 1986).




Regimes and Nuclear Non-Proliferation

What is a regime?

Like many central concepts in the study of international relations-terms such as "balance of power," "national security," and "reciprocity"8- "regime" has come to mean to mean many things to many people at different times. John Ruggie first introduced the concept of international regime to international relations theory in 1975; he defined it as "a set of mutual expectations, rules and regulations, plans, organizational energies and financial commitments which have been accepted by a group of states."9 By 1983, the concept of regime centered around four principal components: principles, norms, rules, and decision-making procedures. Stephen Krasner defines each of these components:

Principles are beliefs of fact, causation, and rectitude. Norms are standards of behavior defined in terms of rights and obligations. Rules are specific prescriptions or proscriptions for action. Decision-making procedures are prevailing practices for making and implementing collective choice.'0

These elements, while necessary for a regime, are not sufficient. Regimes must constitute something more than just short-term expressions of rational self-interest. As Krasner insists, "it is the infusion of behavior with princ- ples and norms that distinguishes regime governed activity in the international system from more conventional activity guided exclusively by narrow calculations of interest. " Long-term considerations are essential when one examines security regimes; as Jervis points out, what analytically distinguishes "regimes" from "agreements" is that, while the latter arranges the promotion of immediate self-interest, the former's purpose is to facilitate agreements through the sacrifice of immediate gain; what allows states to sacrifice the immediate in exchange for future gain is the expectation of reciprocity. 12 Thus, we can distinguish between principles and norms on one hand and rules and procedures on the other. Since principles and norms inculcate an anticipation of reciprocity, they should be considered the "basic defining characteristics" of a regime.13 A regime's rules and procedures

8. For a discussion of the ambiguity surrounding these key terms, see Ernst B. Haas, "The Balance of Power: Prescription, Concept, or Propaganda?" World Politics 6 (July 1953); Arnold Wolfers, "National Security as an Ambiguous Symbol," in Wolfers, Discord and Collabora- tion: Essays on International Politics (Baltimore: Johns Hopkins University Press, 1962); and Robert 0. Keohane, "Reciprocity in International Relations," International Organization 40 (Winter 1986).

9. John Gerard Ruggie, "International Responses to Technology: Concepts and Trends," International Organization 34 (Summer, 1975), p. 570.

10. Krasner, "Structural Causes," p. 2. 11. Ibid., p. 3. 12. Jervis, "Security Regimes," passim. 13. Krasner, "Structural Causes," p. 3; see also John Gerard Ruggie, "International Re-

gimes, Transactions, and Change: Embedded Liberalism in the Postwar Economic Order," in Krasner, International Regimes, pp. 195-231.




may be altered over time as conditions change, but they must remain consistent with the norms underpinning the regime. If these basic norms and principles should change, then the regime no longer exists. Taken together, these principles, norms, rules, and procedures provide the second essential characteristic of regimes beyond a commitment to the long-term: a regime is a system of injunctions about international behavior.

A non-proliferation regime

As its guiding principle, a nuclear non-proliferation regime presumes that the spread of nuclear weapons into many hands would further jeopardize prospects for international peace and security. The hypothesized cause-and- effect relationship underlying this presumption is that while weapons, even nuclear weapons, do not cause conflict, they can significantly exacerbate tensions, especially when they have the socially destructive potential of thermonuclear weapons. Consequently, the appropriate behavior for nuclear-armed states is not to assist others in attaining a similar capacity, and for states without a nuclear armory to forego acquiring one. According to one scholar and former policymaker, the great danger is the "exponential curve of 'speculative fever,' " in which a fear-inspired, mad scramble to possess nuclear weapons raises tensions to a feverish level, and with those tensions the prospect of war.'4

These general principles have been translated into specific norms through two sets of institutions: the series of treaties banning the deployment of weapons of "mass destruction" from set geographical boundaries (the Ant- arctic Treaty, 1959; the Outer Space Treaty, 1967; the Treaty of Tlatelolco, 1967; and the Seabed Arms Control Treaty, 1972); and the Nuclear Non- Proliferation Treaty (NPT) of 1970. The more important institution is the NPT, for it explicitly lays out the essence of the "nuclear bargain" between the nuclear "haves" and "have nots" in six operative clauses. The first three articles obligate the signatories not to transfer nuclear weapons to non- nuclear weapon states (NNWS), not to produce nuclear weapons unless they had already succeeded in doing so, and not to export nuclear materials without international safeguards. The next three clauses establish the "in-

14. Nye, "Maintaining the Non-Proliferation Regime" pp. 15-16. The view that few nuclear weapon states is better than more is by no means universally shared. A prominent international relations scholar who argues the opposite is Kenneth N. Waltz; see "What Will the Spread of Nuclear Weapons Do to the World?" in John Kerry King, ed., International Political Effects of the Spread of Nuclear Weapons (Washington: Government Printing Office, 1979); and Waltz, The Spread of Nuclear Weapons: More May Be Better, Adelphi Paper 171 (London: Interna- tional Institute for Strategic Studies, 1981). A scholar whose recent work argues for the "man- agement" of proliferation instead of its prevention, especially in the Middle East, is Shai Feldman; see Israel's Nuclear Deterrence: A Strategy for the 1980s (New York: Columbia University Press, 1982); and "Managing Nuclear Proliferation," in Snyder and Wells, Limiting Nuclear Proliferation, pp. 301-318. For a recent consideration of whether more or fewer nuclear weapon states would be desirable, see Bruce D. Berkowitz, "Proliferation, Deterrence and the Likelihood of War," Journal of Conflict Resolution (March 1985), pp. 57-82.




alienable right" of all parties to develop nuclear energy for peaceful purposes. It also provides that all parties should facilitate, and have right to participate in, the fullest possible exchange of equipment, materials, and scientific and technological information for the peaceful uses of nuclear energy. And finally, the NPT enjoins all parties to "pursue negotiations in good faith on effective measures relating to cessation of the nuclear arms race at an early date and to nuclear disarmament"; or in other words, the nuclear weapon states were to end their "vertical" proliferation in exchange for an end to "horizontal" proliferation. 15

The "basic bargain" that the NPT signified was that, in return for forego- ing the acquisition of nuclear weapons, the NNWS extracted from the nuclear states a commitment to provide them nuclear technology suitable for the development of nuclear energy industries and to restrain the vertical spiral in nuclear weapon inventories. Underlying the explicit bargain was a tacit agreement: NNWS would not seek to acquire nuclear weapons so long as the nuclear states (both the economically dominant as well as militarily dominant states) sustained a robust and expanding international economy and a system of relative free trade in conventional weaponry.

At both levels of agreement, explicit and implicit, paradoxes have emerged. The calculability, and hence stability, of the system of deterrence between the United States and the Soviet Union has been created with the assistance of large stockpiles of diverse nuclear weaponry. This vertical proliferation, at odds with Article VI, has been largely responsible for the circumspect caution with which the two antagonists have confronted one another, and for the provision of extended deterrence to key allies, who, as a result, have been able to eschew the development of nuclear arsenals of their own. Thus, substantial reductions in the arsenals of the superpowers' nuclear inventories would run counter to the underlying logic of the NPT which views extended deterrence as central to non-proliferation. 16 A second para- dox is related to the implicit bargain concerning a "free market" in conventional arms. The so-called "dove's dilemma" is that if conventional arms are not provided to NNWS, then there will be strong incentives to acquire nuclear weapons; on the other hand, the supply of conventional weapons, in addition to being capable of raising tensions in their own right, can be complements as well as alternatives for nuclear weapons by providing NNWS with advanced delivery systems should they decide in the future to "go nuclear." 7

In addition to the paradoxes that the NPT has raised, the language of the

15. U.S. Arms Control and Disarmament Agency, Arms Control and Disarmament Agree- ments: Texts and Histories of Negotiations (Washington: ACDA, 1982), pp. 91-95.

16. See George Quester, "Nuclear Proliferation: Linkages and Solutions," International Organization 33 (Autumn 1979), passim.

17. See Lewis A. Dunn, "Some Reflections on the 'Dove's Dilemma,' " International Or- ganization 35 (Winter 1981), passim.




treaty has engendered serious political questions. First, what should be the policy of suppliers towards non-parties to the treaty? Cooperation with these countries, while not prohibited by the treaty, would in effect discriminate against NPT members, since the latter would have to accept safeguards while the former would not. Second, does the phrase "fullest possible" cooperation mean that sensitive technologies involving enrichment and reprocessing-technologies that would decisively assist a country's efforts to build a bomb-can be transferred, even though that would mean a violation of Article I?

The locus of rules and decision-making procedures of the nuclear non- proliferation regime can be found most immediately in the system of international safeguards, which is administered by the International Atomic Energy Agency (IAEA). The IAEA was created in 1957 to facilitate the diffusion of peaceful nuclear technology through the American program, Atoms for Peace. According to a former high-level American policymaker on proliferation issues, "The safeguards system is central to the basic bargain of the international regime in which other countries are assisted in their peaceful nuclear energy needs in return for their accepting the intrusion of safeguards and inspection.'"18 These safeguards are necessary because they provide an agreed mechanism for demonstrating and verifying compliance with commitments not to divert safeguarded material to military use; they also provide detailed knowledge of the location, status, and use of safeguarded materials and equipment. Such knowledge is a necessary substitute for trust.

While the safeguards are a critical component of the regime, the IAEA system has no mechanism for effective enforcement; its most potent instru- ment is to suspend technical assistance to a state in violation of the safeguards-to date, no one has ever filed a report of noncompliance. The IAEA's ability to detect noncompliance is also in doubt. The Osirak incident in June 1981, in addition to raising questions about "vigilante" proliferation, raised questions about the IAEA's ability to detect diversions in a timely manner. These questions acquired added poignancy when the IAEA an- nounced it could not adequately account for all of the nuclear material at Pakistan's KANUPP facility.19

Less immediate, but no less critical, rules and decision-making procedures can be found in each country's laws-especially the nuclear suppliers'. For example, according to the International Financial Institution Act of 1977, the United States must suspend any export-import bank loans to any country that terminates safeguards on U.S.-exported material or nuclear equipment; this law also prohibits the extension of any new credits to a

18. Nye, "Maintaining the Non-Proliferation Regime," p. 17. 19. See Jed C. Snyder, "Iraq," and Richard P. Cronin, "India and Pakistan," in Snyder and

Wells, Limiting Nuclear Proliferation, pp. 3-42, 59-88.




NNWS that subsequently detonates a nuclear device.20 Also, the Nuclear Non-Proliferation Act of 1978 had a sharp international reception as the Carter administration attempted to strengthen the non-proliferation regime by making nuclear export criteria more stringent.2'

Two other sources of rules and decision-making procedures appeared during the mid-1970s: the Nuclear Suppliers Group (1974), and the Interna- tional Fuel Cycle Evaluation (INFCE) (1977). The purpose of the Suppliers Group was to establish guidelines for nuclear commerce that would keep commercial competition from undercutting safeguard obligations. INFCE, which had a goal to restrict the spread of weapons-grade plutonium, was actually tied more closely to the international regime given its much broader membership. INFCE has forty-six members as opposed to fifteen for the Suppliers Group; INFCE also included states that were not well advanced in their nuclear energy program.

Apparently, given the general criteria used to confirm the existence of an international regime, there is indeed a nuclear non-proliferation regime. However, as mentioned earlier, most regime analysis has studied international economic issues and consequently, the criteria it developed may not be completely appropriate to security issue regimes. We need to examine whether the international arrangements over nonproliferation conform to the prerequisites established thus far for the existence of security regimes.

Jervis's conditions for the existence of a security regime can be divided into two sets: broad systematic circumstances, and more narrow variables that "directly bear on the security dilemma."22 Under the heading of broad systemic conditions, we can identify four that are most propitious for the formation and maintenance of a security regime: first, a security regime will be most possible after a highly destructive and prolonged war; second, the actors must believe that the value they place on security cooperation is shared by other states, as cooperation will not occur if states believe that they are confronted by a defector with strong anti-status quo ambitions; third, there all the major actors must accept the status quo; and fourth, war and the "individualistic pursuit of security" must be seen as more costly than cooperative action.23

All these conditions are replicated, at least in part, in today's world. Less than forty-five years ago, mankind's most costly war, in terms of lives and treasure lost, was concluded by two of the most militarily efficient and

20. For the consequences of American legislation on U.S. relations with certain emerging nuclear states, and the impact of that legislation on those nascent nuclear programs, see Leonard S. Spector, Nuclear Proliferation Today (Cambridge, Mass: Ballinger, 1984).

21. See Beckman, Nuclear Non-Proliferation, passim. For a prefiguration of the Carter administration's non-proliferation policy, see the Ford/Mitre report by the Nuclear Energy Study Group, Nuclear Power: Issues and Choices (Cambridge, Mass.: Ballinger, 1977).

22. Jervis, "Security Regimes," p. 178. 23. Most of these conditions are drawn from Jervis, ibid., passim; also see the sources cited

in note 2.




socially destructive actions: the bombing of Hiroshima and Nagasaki. Given that nuclear weapons are indiscriminate in their effects, and that their effects are widespread, we can conclude reasonably that none of the nuclear weapon states, let alone most of the NNWS, place a high value on rapid or wide proliferation. The nuclear non-proliferation regime, as it now stands, represents a modified but fundamental acceptance of the immediate postwar status quo. The status quo was that nuclear weapons were held by only a tiny minority of states. The modification is that basic nuclear science and technology should be shared with the vast majority. And finally, in today's world, it is a truism that nuclear war is exceptionally costly not only in its effects, but also in its preparation.

The variables that directly concern the security dilemma facing each state revolve around the ability to distinguish offensive from defensive weapon systems and on the relative potency of those respective systems. Jervis reasons that:

If defensive measures are both distinct and potent, individualistic security policies will be relatively cheap, safe, and effective and there will be less need for regimes. When the opposite is the case-when offensive and defensive weapons and policies are indistinguishable and when attacking is more effective than defending-status quo powers have a great need for a regime, but forming one will be especially difficult because of the strong fear of being taken advantage of.24

One of the most propitious sets of conditions for regime formation, Jervis concludes, are those in which "offensive and defensive weapons and policies are distinguishable but the former are cheaper and more effective than the latter.... "25 Under such circumstances, the costs of individualistic action are high, the incentives to cooperate are strong, and the fear of being taken advantage of are low enough to make joint action consistent with national security interests.

To compare Jervis's ideal with today's reality, we must consider the "of- fensiveness" or "defensiveness" of a particular weapon system on two levels: tactical and strategic. The Strategic Defense Initiative, for example, is inherently a tactical defensive system, but it can be employed in a strategic offensive mode to complement a large-scale, preemptive first strike. What this example demonstrates is that the nature of weapons systems along the offensive/defensive continuum at the strategic level is a function less of the qualities of the weapon itself and more of the foreign policy purposes which the weapon system is meant to serve. Nuclear weapons, given their destructive capacity and the accuracy with which they can be delivered to their target, are more militarily efficient when used offensively at the tactical level, than if they are employed defensively. It seems that the Douhet princi-

24. Jervis, "Security Regimes," p. 178. 25. Ibid.




ples of aerial bombardment are much more applicable today than when they were formulated over sixty years ago: in the nuclear era, the advantage lies with the side that strikes first; at present, there is no militarily efficient or cost-effective way to provide a credible area defense. From such analysis, we can reasonably conclude that the conditions are present for the formation and maintenance of a security regime encharged with preventing the spread of nuclear weapons, and that the established arrangements are consistent with the general criteria for an international regime. Why was this regime formed, and why has it been maintained?

Hegemonic stability and the non-proliferation regime

The theory of hegemonic stability

I have asserted that the theory of hegemonic stability modified the traditional state-centric power politics paradigm of international relations. To more fully understand the distinctive nature of this modification, it is beneficial to review the strict traditional view of international regimes. In regime analysis, the traditional perspective of international relations has been labeled the "structuralist" position. Structuralists employ a schematic design that posits state behavior as the dependent variable and considerations of power as the independent variable. As a consequence, structuralists can see no utility in the concept of a regime: in addition to obscuring the dominant, dynamic, underlying international politics and being value-biased, the concept has no explanatory value. Susan Strange, one of the most represen- tative structuralists in a seminal collection of articles on regime theory, argues that "all those international arrangements dignified by the label regime are only too easily upset when either the balance of bargaining power or the perception of national interest (or both together) change among those states who negotiate them."26

The modified structuralist approach (under which the theory of hegemonic stability falls) has some use for the concept of regime. This position retains the same schematic design as the structuralists, except that it shows regimes as intervening variables between the basic causal variable, power, and state behavior. Under this conceptualization, regimes impact on behavior when "Pareto-optimal outcomes could not be achieved through uncoordinated individual calculations of self-interest.' 27

Based on a modified structuralist orientation, the theory of hegemonic stability has three key propositions. The first is that hegemons, given their

26. Susan Strange, "Cave! Hic Dragones: A Critique of Regime Analysis," in Krasner, International Regimes, p. 345.

27. Krasner, "Structural Causes," p. 7; also in that same volume see the arguments of Arthur A. Stein, "Coordination and Collaboration: Regimes in an Anarchic World," pp. 115- 140; and Keohane, "The Demand for International Regimes," pp. 141-172.




power capabilities, are responsible for the formation of regimes.28 Two quali- fications or distinctions should be made. First, one should differentiate between the "crude" and "refined" versions of hegemonic regime formation. The crude variant posits an automatic relationship between the distribution of power and the creation of regimes-a state with hegemonic power will automatically and naturally form regimes to advance its interests. A more refined or more sophisticated analysis of hegemonic regime formation does not posit an automatic coupling of power with leadership, but rather is sensitive to the domestic political milieu and constitutional arrangements, as well as the history of the hegemon. Hegemony under the refined version can be defined as a situation in which "one state is powerful enough to maintain the essential rules governing interstate relations and willing to do so."29 A second distinction is between hegemonic power in an overall structural sense or just in particular issue-areas. If hegemonic power is conceived as existing in an overall sense, then there are a number of associated assumptions that should be acknowledged: the first is that the power of the hegemon is fungible, that is, it can be transformed from its natural issue domain to other issue-areas; consequently, it is assumed that there is a seamless web linking issues, and within this web, a definite hierarchy of issues that rein- force the hegemon's primary strength. If a hegemon is seen as existing only in a given issue-area, then the opposite is assumed: little meaningful fungibil- ity of power, no seamless web, and no hierarchy of issues.30

The title of Robert Keohane's latest book effectively captures the essence of the second key proposition in the theory of hegemonic stability. After Hegemony: Cooperation and Discord in the World Political Economy asks how the benefits of hegemonic cooperation can be sustained after the hegemon's decline. The second proposition is that the cooperation enforced by the hegemon and provided by the existence of regimes benefits not only the hegemon but also the entire system. This regime is, in other words, an international public good. Hegemonic stability theory also has three critical assumptions: (a) different states will be able to simultaneously consume or benefit from the provision of the good; (b) noncontributors or "defectors" cannot be excluded from the benefits of the collective good; or in other words, there can be "free-riders"; and (c) collective action is impossible. As one scholar points out, the last assumption is essential for this theory:

for if collective action is possible then states might cooperate to provide public goods in the absence of hegemonic power. If it is not possible, then only a hegemonic actor . .. can provide the good because only it

28. For a discussion of the absolute versus relative size of hegemons and the contrast between coercive and benevolent leadership in the formation of regimes, see Snidal, "The Limits of Hegemonic Stability Theory," pp. 588-590.

29. Keohane and Nye, Power and Interdependence, p. 44 (emphasis added); see also Keohane, After Hegemony, pp. 32-39.

30. See Keohane and Nye, Power and Interdependence, pp. 38-60.




can act unilaterally to provide the good or coerce others into contribut- ing or both.3'

The third key proposition concerns hegemonic decline. According to some scholars, hegemons historically have declined for three principal reasons: increasing costs of system maintenance, diffusion of technology, and increasing internal consumption vis a vis domestic investment. These factors invariably lead to relative decline and, eventually, to absolute decline in most cases.32 This decline is seldom sudden and, due to the regimes created and sustained by the hegemon, a habit of cooperation is inculcated; what might be called "leadership lag" develops, in which the cooperation suited to the hegemon is continued despite its decline. Put simply, the third proposition states that as hegemons go, so go their regimes; and with the disappearance of a hegemon and its regimes, so vanishes whatever vestige of international order.

Theory and the non-proliferation regime

A widely shared interpretation of postwar history affirms the validity of the first key proposition, that a hegemon's willing and active intervention is essential for the formation of a regime. The 1950s and 1960s, according to this interpretation, are a "golden age of non-proliferation," a time (as one author describes it) when the United States, "largely by virtue of its preeminence in nuclear commerce, was able to forge and progressively upgrade an international consensus that served both its own self-interest and the general welfare. " 33 Such an interpretation, while consistent with the theory of hegemonic stability, is at odds with history.

Few would argue that the United States, in 1945, was in a position of overall systemic and absolute hegemony in the issue area of nuclear energy and weaponry. A minor, but significant, tenet of this first proposition is that it is natural for the hegemon to seek to recreate and perpetuate the conditions that gave it unrivaled power. Consequently, the rudimentary origins of the nuclear non-proliferation regime date back to 1943. In an effort to keep Nazi Germany from developing an atomic bomb, Britain and the United States agreed at the Quebec Conference in 1943 not to transfer information regarding the atomic bomb project to third parties. The logic behind this wartime policy of selective denial was carried into the immediate postwar years and transformed into a policy of comprehensive denial. Based on the recommendation of the Acheson-Lilienthal Report, the United States of- fered to work out arrangement for the international ownership and control of

31. Snidal, "The Limits of Hegemonic Stability Theory," p. 593. 32. Gilpin, War and Change, passim. 33. Peter A. Clausen, "US Nuclear Exports and the Non-Proliferation Regime," in Snyder

and Wells, Limiting Nuclear Proliferation, p. 190.




all nuclear materials and facilities in the 1946 Baruch Plan. However, pend- ing agreement on such an arrangement with appropriate international safeguards, the United States prohibited, through the MacMahon Act of 1946, the export of nuclear materials, equipment, or technology to any nation.34 With the predictable failure of the Baruch Plan, due to the United States' refusal to grant the Soviet Union a power of veto, American nuclear policy, regardless of intent, became one of extreme denial-a policy that would, if successful, preserve the American nuclear monopoly position.

This attempt by the United States to build a very restricted non- proliferation regime, while in agreement with the traditional assumptions about hegemonic behavior, stood in marked contrast with the other attempts by the United States to build regimes in the postwar period. The trade regime35 that the United States constructed in the postwar period, with its principles of non-discrimination and liberalization, was rooted in classical liberal economic thought, which has as its core proposition the unhindered operation of the marketplace. Unfettered operation entailed two conditions: no privileged, protected monopolies; and easy access to markets. This trade regime, when combined with American aid policies, sought to create a system of economically strong and competitive states. The inference to be drawn from this is that the United States, in the issue of trade, deliberately pursued a set of policies and institutions that would reduce American political and economic hegemony.36 For example, Senate support for both the Marshall Plan and accession to the North Atlantic Treaty were contingent on the understanding that European economic and military dependence was to be a temporary phenomenon; through "self-help and mutual aid" the Euro- peans would eventually enter into an equitable partnership with their cousins in the New World. The early postwar policies on trade have worked: the United States, while still possessing the world's largest economy is increasingly caught in a competitive struggle with Western Europe, Japan, and the "new industrializing countries." The United States is no longer an economic hegemon; it no longer has unrivaled economic strength or authority. In sharp contrast, the regime that the United States tried to establish to control nuclear proliferation-a regime designed to preserve American hegemony-was spectacularly unsuccessful and short-lived.

The period 1946-53 illustrates the inherent limitations of a policy of ex-

34. See Beckman, Nuclear Non-Proliferation, pp. 29-35. 35. For introductions to the "trade regime," see Charles Lipson, "The Transformation of

Trade: The Sources and Effects of Regime Change," in Krasner, International Regimes, pp. 233-272; and Jock A. Finlayson and Mark W. Zacher, "The GATT and the Regulation of Trade Barriers: Regime Dynamics and Functions," in Krasner, ibid., pp. 273-314; also in the Krasner volume, see Ruggie, "International Regimes, Transactions, and Change: Embedded Liberalism in the Postwar Economic Order."

36. In contrast to this line of reasoning David H. Blake and Robert S. Walters argue that the postwar multilateral agreements on trade and money were designed to "facilitate the perpetua- tion of American preeminence," The Politics of Global Economic Relations (Englewood Cliffs, N.J.: Prentice-Hall, 1983), p. 2.




treme denial on nuclear issues. The nature of the nuclear "problem" con- fronting mankind is, in its most fundamental sense, a problem of knowledge. The origins of the nuclear problem lie not in any unique social or political circumstance of our time, but rather in the attainment by mankind after centuries of scientific thought and endeavor, of a certain level of knowledge of the physical universe; such knowledge cannot be unlearned nor prohibited from distribution. Thus, the "solution" to the associated dangers of nuclear energy use in both peaceful and bellicose forms is only partially amenable to technical remedy; fundamentally, the solution lies in the patterns of social and political interaction that man fashions. By 1952, without any direct assistance from the United States, two other nations had joined the nuclear weapons club (Soviet Union, 1949; and Britain, 1952), and sev- eral others were embarked on extensive civil nuclear programs.

With its monopoly position involuntarily stripped away, the United States shifted its policy from one of extreme denial to one of controlled construc- tive cooperation. The 1953 Atoms for Peace program centered on manipulat- ing incentives through a loose nuclear "bargain." In return for access to nuclear technology and materials, recipients would give assurances of peaceful use and would accept safeguards to verify compliance with those assurances.37 The Atoms for Peace program was more than an attempt to create a nuclear weapons oligopoly; it was a recognition that the knowledge of mankind cannot be held and exploited exclusively by one nation. The new American policy assumed that while the United States could not prevent the development of nuclear weapons in other countries, it might nonetheless gain influence through the cooperation of the nuclear "have-nots." Nuclear cooperation could elicit "peaceful-use" commitments, and, it was hoped, steer nuclear programs in cooperating countries away from military activities.

The 1953 Atoms for Peace program provided clearer outlines of what a viable non-proliferation regime would entail, but the regime could not be said to be institutionalized until over a decade later when the NPT was signed and enacted. Atoms for Peace had no injunctions, and injunctions are the "essence" of regimes. The new American policy did not directly con- strain national nuclear weapon programs. Participating countries were free to pursue military nuclear programs in conjunction with externally assisted peaceful ones, as did France; there was no compulsory renunciation of a weapons option.38 The effect of this omission was that the "bargain" was

37. Safeguards were initially administered on a bilateral basis by the United States and then transferred to the International Atomic Energy Agency (IAEA) after the agency's inspection procedures were established in 1960.

38. This is not to say that the United States did not attempt to "dissuade" countries, such as France, from pursuing a nuclear weapons program. France, with its own domestic sources of uranium and privileged access to sources in former French colonies, was not completely at the mercy of the stranglehold on uranium supplies that the United States and Britain (through the Commonwealth) held, but it was vulnerable. In 1956 and 1965, France attempted to purchase




hedged on both sides of the nuclear supply line. If recipients of nuclear aid were not required to give non-proliferation assurances, it was also true that there were limits to cooperation on the supplier side, especially regarding the enrichment technologies so crucial to weapons development.

The reasons for the switch in American policy, beyond the futility of a denial strategy, were threefold: the need to reduce alliance tensions; the desire to expand commercial possibilities; and the hope that peaceful nuclear cooperation could be turned to American advantage in the U.S.- U.S.S.R. arms race.39 The conditions for American support of a NPT were similar, but instead of seeking advantage over the Soviet Union, American leaders signed the NPT with the expectation that it would further detente. Unlike Atoms for Peace, the negotiations for the NPT exacerbated tensions within the Atlantic Alliance, particularly with the Federal Republic of Germany, which saw the NPT and the abandonment of the proposed Multi- lateral Force as the beginning of a nuclear rapprochement between the superpowers that would be contrary to European interests.40 And commercially, the United States had reached the zenith of its possibilities by signing of the NPT due to a decision in the late 1950s by the European Atomic Energy Community to recommend that Europe adopt the American light water reactor over the gas-cooled reactor developed by Britain and France.4' Following the initial exports to Italy in 1958 and the Federal Republic of Germany in 1961, American firms (primarily Westinghouse and General Electric) staked out a commanding position in the nuclear energy market; through direct sales and licensing agreements, U.S. firms supplied 90 percent of the European market by the time the NPT was signed.42 Such foreign commercial success was essential to the U.S. nuclear industry because of

Canadian uranium on an unrestricted basis. Both times the United States objected, and both times the sale fell through. Eventually, the Canadian government decided that all sales of uranium to any state, including the United States, would be subject to a peaceful-uses-only clause. In the "Honeywell incident" (also in 1965), the United States prevented the sale of computers to France that could aid the efforts to build a force de frappe. See Lawrence Scheinman, Atomic Energy in France Under the Fourth Republic (Princeton: Princeton Univer- sity Press, 1965), pp. 176-84; and Scheinman, "Security and a Transnational System: The Case of Nuclear Energy," International Organization 25 (Summer 1971), pp. 637-638.

39. On the U.S.-U.S.S.R. context, see Henry Sokolski, "Atoms for Peace: A Non- Proliferation Primer?" Arms Control (September 1980), passim.

40. On the politics of the NPT negotiations, see Elizabeth Young, A Farewell to Arms Control (Hammondsworth, U.K.: Penguin, 1972); and George Quester, The Politics of Nuclear Proliferation (Baltimore: Johns Hopkins University Press, 1973). For an insightful treatment of the tensions between American alliance and non-proliferation policies, see William Bader, The United States and the Spread of Nuclear Weapons (New York: Pegasus, 1968).

41. On the "reactor wars" and U.S. penetration in the European market, see Irvin C. Bupp and Jean-Claude Derian, Light Water: How the Nuclear Dream Dissolved (New York: Basic, 1978); and Henry Nau, National Politics and International Technology: Nuclear Reactor De- velopment in Western Europe (Baltimore: Johns Hopkins University Press, 1974).

42. Paul Jaskow, "The International Nuclear Industry Today," Foreign Affairs 54 (Summer 1976), p. 792.




the slow development of the American domestic market. The NPT would, however, create and further conditions for a relative decline of the American commercial dominance in the nuclear market.

The NPT institutionalized a regime by enlarging and making more explicit the "bargain" first made with the Atoms for Peace program. For the first time, recipients of nuclear equipment and fuel were asked to renounce formally and officially the development of nuclear explosives and to accept safeguards on their entire nuclear programs, including both indigenous and foreign-assisted activities and facilities. On the other side, nuclear suppliers pledged to provide the "fullest" possible exchange of nuclear information and equipment consistent with peaceful uses of nuclear energy. It was the second half of the nuclear "bargain" that brought U.S. proliferation policy into an alignment that was consistent philosophically and effectively with much of the American postwar regime building. It was philosophically consistent in that it embraced the principles of classical liberal economics. Effectually, it firmly established the conditions for American decline in the nuclear energy market, a decline that was progressively reflected in the establishment of the Nuclear Suppliers Group in 1974, the 1975 West German sale of enrichment and reprocessing technology to Brazil, the French sales of export reprocessing facilities to South Korea and Pakistan, and the creation of INFCE (International Fuel Cycle Evaluation) in 1977. The NPT and the regime it institutionalized helped to create a set of market conditions that differed radically from what had prevailed before. Previously, nuclear energy was a "seller's market" due to the presence of only one supplier of commercially viable technology and equipment. Now, in a highly competitive "buyer's market," a growing number of countries are vying for sales at a time when the market is depressed, due to low prices of alternative energy sources (namely oil), problems associated with pervasive cost-overruns, and public health hazards (most recently illustrated by the Chernobyl incident).

The development of the nuclear non-proliferation regime reverses every core proposition for the theory of hegemonic stability. Theory states that a hegemon will encourage cooperation, that a regime will not be possible without a hegemon' s initiative and effort. While the United States did eventually encourage cooperation, it saw no reason initially to link the development of peaceful nuclear energy and nuclear weapons so long as it appeared able to control the process of technological diffusion. As one scholar notes, "The desire to construct the non-proliferation regime came only when the process seemed to go out of [the United States' and the Soviet Union's] control. 43 Other countries essentially forced the hegemon to see the benefits of cooperation. It has been said as a criticism of the theory of hegemonic stability that "hegemons require deference to enable them to construct a

43. Ernst B. Haas, "Why Collaborate? Issue Linkage and International Regimes," World Politics 33 (April 1980), p. 371.




structure ... it is too expensive and perhaps self-defeating to achieve this by force."44 However, more than deference was required in the construction of the non-proliferation regime, given the intrusive nature of the safeguards and the ability to proceed (albeit at extreme cost) without U.S. help. It required active, indeed energetic, cooperation with the hegemon.

The theory also states that, as a hegemon declines, the regime undergoes a period of progressive strain until it finally collapses, due to the absence of hegemonic leadership. Contrary to the theory, the non-proliferation regime was institutionalized precisely when the United States entered a period of overall hegemonic decline; it has grown more effective during a period when the United States has declined as a hegemon in the issue-area of nuclear energy. Between the time the United States tabled a draft non-proliferation treaty to the Eighteen-Nation Disarmament Committee in August 1965 and the formation of the Nuclear Suppliers Group in 1974, the United States began to suffer from the classic symptoms of a hegemon in decline: rising costs of system maintenance, a diffusion of technology, and a level of consumption that outweighed investment. The period from the mid-1960s to the mid-1970s has as its historical bookends the introduction of large military units in Vietnam and their eventual withdrawal. However, much more is contained in that period than the process of American military engagement in and retreat from Southeast Asia. From 1966 to 1971, the United States suffered a growing deficit with its balance of payments, until the debt tripled to $10 billion in 1971. Also in that year, the value of American imports exceeded exports for the first time in the 20th century, and America became a net importer of energy. The inflation induced by huge budget deficits, designed to simultaneously finance a major war and extensive social welfare programs, contributed to the erosion of American economic strength by discouraging savings and investment.45 In the military realm, 1967 marks the point when the Soviet Union began to achieve rough parity at the level of central strategic forces, and the first Strategic Arms Limitation Treaty agreement in 1972 ratified a balance of central nuclear forces that had the U.S.S.R. ahead in some static indicators of capability. As discussed earlier, this was also the period that saw the American share of the nuclear market ebb from its high of nearly 100 percent in the late 1960s to 35 percent by the late 1970s.46

Not only was the non-proliferation regime formed at the end of American

44. Keohane, After Hegemony, p. 45. 45. The question of whether the United States is still a hegemon is not yet a closed question.

See Susan Strange, "Still an Extraordinary Power: America's Role in a Global Monetary System," in Raymond E. Lombra and William E. Witte, eds., Political Economy of Interna- tional and Domestic Monetary Relations (Ames: Iowa State University Press, 1982); and Bruce Russett, "The Mysterious Case of Vanishing Hegemony: Or Is Mark Twain Really Dead?" International Organization 39 (Spring 1985).

46. Clausen, "US Nuclear Exports," in Snyder and Wells, Limiting Nuclear Proliferation, p. 201.




hegemony, but it has grown and been relatively successful. One is led to conclude that the "success" over non-proliferation has been because of, not despite, American hegemonic decline. The period of American hegemony saw the greatest weapons proliferation. Since the signing of the NPT and U.S. decline, only the Indians exploded a nuclear device in 1974.47 As one former U.S. policymaker on non-proliferation issues observed:

What is remarkable . . . is that the rate of proliferation has not been faster. Of the score or more states that could probably have exploded a device if they had chosen to do so, less than a third so chose in the past three decades.48

Moreover, while France, as a non-party to the NPT, has always stated that it would act as a party, the other major nuclear weapon non-party state, the People's Republic of China, has until quite recently rejected the basic norms of non-proliferation. Over the past three years, China's policy has changed radically. While still critical of the NPT, it has insisted that it will not assist other countries acquire nuclear explosives and that it will require IAEA safeguards on its nuclear exports. A positive sign recently occurred among the group of emerging or "second tier" nuclear suppliers: Argentina, which in 1979 received a heavy water plant and a reactor from West Germany and Switzerland-acquisitions which pushed Argentina close to nuclear self- sufficiency-has indicated that it will require IAEA safeguards on its nuclear exports.49

All this is not to say that there are not challenges to the non-proliferation regime's viability or that the United States has played no significant role since 1970. As mentioned earlier, the problems defy easy solution: a growing and competitive group of nuclear suppliers crowd a depressed market; the most promising clients are those who have strong incentives to acquire nuclear weapons; sophisticated technological "sweeteners" could win the day; and the use of plutonium as a civilian nuclear fuel pose is on the rise. Despite its decline, the United States is not without influence. For example, during the Carter administration, INFCE was formed and was successful

47. There is, of course, considerable circumstantial evidence that South Africa (possibly in conjunction with Israel) exploded a nuclear device in 1979. For a review of this evidence, see Washington Office on Africa Educational Fund, "The September 27, 1979 Mystery Flash: Did South Africa Detonate a Nuclear Bomb?" (21 May 1985). What makes this report so interesting is that it relies heavily on U.S. Naval Research Laboratory documents. For a more general review of South Africa's status as a nuclear threshold state, see Robert Jastrow, "South Africa," in Snyder and Wells, Limiting Nuclear Proliferation, pp. 146-180. The widely held belief that Jerusalem secretly possessed nuclear weapons was recently given additional cre- dence; based on the testimony of Mordechai Vanunu, a former employee of the Dimona nuclear plant, London's Sunday Times reported on 5 October 1986 that Israel had stockpiled about 100 atomic weapons over the last twenty years, making Israel the sixth-ranked nuclear power in the world.

48. Nye, "Maintaining the Non-Proliferation Regime," p. 15. 49. Dunn, "Building on Success," pp. 230-231.




in getting the FRG to implement a moratorium on new reprocessing exports and also in persuading France to suspend the export of reprocessing technology to Pakistan.50 Under Reagan's tenure, the United States has encouraged China's policy change by offering a nuclear cooperation agreement (signed in 1984 and ratified in 1985), and has discouraged Pakistan's nuclear proliferation through a combination of Indian diplomacy and an economic/military aid package with F-16s.51 The central point is that the regime has been maintained and strengthened as its patron hegemon has declined markedly in relative strength.

The fact that the regime was formed and maintained during hegemonic decline calls into question the remaining key proposition of hegemonic stability theory-namely, that only a hegemon can provide the public good of the regime, because no collective action is possible. While no one questions that the non-proliferation regime provides a public good, we can ask who, exactly, provides this public good. As two analysts observe:

Unless the unexpected happens and the US market for power reactors revives, leadership will move elsewhere in the 1980s, and probably to France, West Germany, and Japan. In some respects it has already done so.52

Evidently, collective action is possible without the aegis of hegemonic leadership. Continued cooperation between the United States, France, West Germany, and Japan is doubtful given their significant divergences in interest and perspective, but one noted analyst observes optimistically that a "vibrant supply regime" will extend into the 1990s and beyond because the four will focus on "political, institutional non-proliferation, in contrast to technical solutions."53

When one compares the evidence with the theory, the results are quite paradoxical. Instead of regime formation and maintenance existing in direct relation to the degree of hegemonic power, an inverse relationship exists: as the position of American hegemony eroded, cooperation on nuclear non- proliferation has grown. While the critical role the United States plays in the defense of Western Europe, Japan, and South Korea may explain those countries' cooperation, it by no means explains the cooperation of the

50. On the Carter administration's emphasis on utilizing "supplier leverage," see Beckman, Nuclear Non-Proliferation; Joseph S. Nye, "Non-Proliferation: A Long Term Strategy," For- eign Affairs 56 (Spring 1978); George Quester, ed., Nuclear Proliferation: Breaking the Chain (Madison: University of Wisconsin Press, 1981); and Michael Brenner, Nuclear Power and Non-Proliferation (New York: Cambridge University Press, 1981).

51. On the Reagan approach to non-proliferation, which stresses "reliable supply," see Peter Clausen, "The Reagan Non-Proliferation Policy," Arms Control Today 14 (December 1982); Spector, "Unfinished Business"; and Dunn, "Standing up for the NPT."

52. William Walker and Mans Lonnroth, Nuclear Power Struggles: Industrial Competition and Proliferation Control (London: George Allen and Unwin, 1983), p. 1.

53. Joseph F. Pilat, "The Future of the Nuclear Supply Regime," in Jones, Institutional Policy Choices, pp. 90-91.




Soviet Union, Sweden, India, and the rest of the Third World. The existence and maintenance of the non-proliferation regime must be explained by something other than the distribution of power.

The functional theory of regimes and non-proliferation The functional theory

The theory of hegemonic stability falls prey to the realist tendency to overstate the degree of anarchy in international politics and, consequently, understate the potential for states to rationally pursue cooperation. Hege- monic stability theory, like realism before it, argues that states can be treated as unitary (rational) actors engaged in the pursuit of advancing self- interest; in this pursuit, they will sometimes find it advantageous to take actions that harm other states, especially if there is no central authority to enforce rules and apply sanctions. However, this rationality does not prevent states from collaborating when it is in their best interest. Indeed, the burden of much recent scholarship in international relations, particularly in international political economy, verifies the existence of a great deal of cooperation.54

Since international politics is more like a Lockean world than a Hobbesian one, we must clearly understand what is meant by "cooperation." Accord- ing to two scholars:

Cooperation is not the equivalent to harmony. Harmony requires the complete identity of interests, but cooperation can only take place in situations that contain a mixture of conflicting and complementary interests.55

Such a definition has two critical assumptions. The first is that cooperation, unlike harmony, requires active and deliberate attempts to adjust policies to meet the demands of others. Second, cooperation is initiated on the basis of anticipated effects-effects that are believed to be beneficial. On this second assumption, the functional theory of regimes is grounded.56 The principal anticipated effect, according to the functional theory, is that the regime will overcome conditions of "political market failure."

The functional theory of regimes also is grounded in the vocabulary and logic of microeconomics. The correspondence in the analogy are quickly and

54. For example, see Keohane, After Hegemony, passim; Krasner, International Regimes, passim; and the special issue of World Politics 38 (October 1985), entitled "Cooperation under Anarchy."

55. Axelrod and Keohane, "Achieving Cooperation under Anarchy," p. 226. 56. The principal author of the functional theory is Robert Keohane; see his "Demand for

International Regimes," passim; and After Hegemony, pp. 85-109. For a related argument, see Arthur A. Stein, "Coordination and Collaboration: Regimes in an Anarchic World," in Kras- ner, International Regimes, pp. 115-140.




easily made: the nation-state corresponds to the firm, the international system is the marketplace, and the great powers are oligopolists. But more fundamentally, both the marketplace and the international systems are conceived as "self-help systems," and in both the actors are unified and rational. Using the Coase theorem of microeconomics, Robert Keohane, the leading theorist of functional approach, argues that the anarchic world of international politics creates an intrinsic "demand" for international regimes, and that regimes are responses to problems of property rights, legal liability, high transaction costs, and information imperfections inherent in the international system. In essence, regimes engender Pareto-optimal outcomes unavailable to uncoordinated, individualistic pursuit of self-interest; they overcome "political market failure" by facilitating agreements. As Keohane elaborates:

Governments believe that ad hoc attempts to construct particular agreements, without a regime framework, will yield inferior results com- pared to negotiations within the frame work of regimes.57

"Political market failure" is ameliorated by the "legal liability" that regimes provide. The significance of international regimes lies not in their formal legal status, since any pattern of legal liability can be overturned by the action of sovereign states, but in the establishment of stable mutual expectations about others' patterns of behavior that permit the development of working relationships. Regimes provide a semblance of legal liability so that the "costs of reneging on commitments are increased, and the costs of operating within these frameworks are reduced."58

The high transaction costs of "political market failure" are reduced by regimes exploiting potential economies of scale in "dense" issue-areas. Regimes, quite simply, reduce costs by linking issues. When a number of issues are closely related, an ad hoc approach toward those issues will be less effective than approaching them with a shared set of principles, norms, rules, and decision-making procedures. This linkage of issues encourages the "nesting" of regimes within one another; the cumulative effect of "nesting" is to create a situation analogous to an iterated, open-ended game of Prisoner's Dilemma. Unlike a single, finite play of a PD game, the rational thing to do in an iterated, open-ended PD game is to cooperate, not "de- fect." According to Keohane:

Without international regimes linking clusters of issues to one another, side payments and linkages would be difficult to arrange in world politics; in the absence of a price system for the exchange of favors, institutional barriers would hinder the construction of mutually beneficial

59 bargains.

57. Keohane, After Hegemony, p. 88. 58. Ibid., p. 89. 59. Ibid., p. 91.




One of the most pressing problems that frustrates coordination is insuffi- cient and asymmetrically shared information. Thus, regimes overcome a third cause for "political market failure" by increasing the distribution and accuracy of critical information, and thereby reduce the level of uncertainty and risk in making agreements. Regimes can help governments assess others' reputations by not only providing standards of behavior against which performance can be measured, but also basic information on performance. Keohane suggests that:

[R]egimes may also include international organizations whose secre- tariats act not only as mediators but as providers of unbiased information that is made available, more or less equally to all members.60

The functional theory and the non-proliferation regime

The functional theory of regimes upholds the Waltzian dictum that a good theory of international politics is "systemic.' '61 However, Keohane's functional theory goes beyond previous "systemic" theories in a highly innova- tive way: it combines the "downward-looking" theory of public goods and market failure with the "upward-looking" theory of games or rational choice. This combination is particularly valuable for analyzing the non-proliferation regime since it accounts for one of the principal anomalies that appeared with the application of hegemonic stability theory, namely, the self-sustaining character of the regime despite the decline of the hegemon.

The non-proliferation regime, through its explicit and implicit obligations as embodied by the NPT, generates an aura of "legal liability" and consequently establishes clear and stable expectations about others' patterns of behavior. The non-proliferation regime's "basic bargain" clearly links the issues of economic health and military security, both at the level of domestic and international politics. Fundamental budget allocations are critically affected by the decision to acquire nuclear weapons. The international rami- fications of such a decision are obvious: the regional apprehension, the general disapprobation, and the probable ostracism. The development of nuclear energy is crucially affected by decisions concerning financing and transfers of technology. The non-proliferation regime is consequently "nested" within an extensive set of other international arrangements, including those for monetary relations, foreign investment, aid to developing countries, formal alliances, and a myriad security arrangements that involve extended nuclear deterrence and conventional arms transfers. A generally reliable flow of unbiased information reduces the transaction costs of nuclear energy cooperation, and makes this complex of overlapping and cross-

60. Ibid., p. 94.ioaPoiis(eYokRndmHu, 61. See Kenneth N. Waltz, Theory of International Politics (New York: Random House,

1979), pp. 38-59.




cutting issues more understandable, and hence more amendable to coherent and consistently beneficial action. This information flow is provided by the flawed, but so far sufficient IAEA safeguard system; the conferences of nuclear suppliers; international discussions over the fuel cycle; and the pe- riodic reviews of the NPT. The constancy of this information flow suffices to lengthen the shadow of the future for members of the regime by providing "timely warning" of any impending "defection," and as a result, it facilitates the arrangement of many lesser agreements. To use the lexicon of test pilots, the function theory can explain why states-often in extremely tense conflict relations, or in pursuit of egoistical self-interest-will push the limits of adherence to the NPT, but not break the proliferation "barrier. "

However, functional theory's central strength, explaining regime maintenance, presents a critical problem. By defining a regime as a structure designed to facilitate international agreement, the functional theory answers specifically why states continue to cooperate with a regime, but it disregards the larger question of why regimes arise at all in international politics. This deficiency can be traced back to a slight, but significant, modification in the definition of regimes. This redefinition leads the functional theory to a theoretical cul de sac.

International regimes, as defined by Krasner, are "principles, norms rules, and decision-making procedures around which actor expectations converge in a given issue-area.' 62 Keohane extends this definition, making it more precise and potentially more sterile. For Keohane, regimes are designed to facilitate agreements; he suggests that they are the outgrowth of bargaining and negotiation, leading to institutional arrangements which are formalized in contracts or treaties. He also suggests that arrangements emerging in any other way do not qualify as regimes,63 excluding the possi- bility that regimes might emerge spontaneously, or through coercion.' By emphasizing negotiation and bargaining, Keohane reintroduces the distribution of power as an independent variable explaining regime formation. This reintroduction of the distribution of power leads back to the theory of hegemonic stability and its attendant problems. In other words, Keohane disposes of hegemonic power as the key explanatory variable in regime formation:

The dominance of a single great power can contribute to order in world politics, in particular circumstances, but it is not a sufficient condition and there is little reason to believe that it is necessary.65

62. Krasner, "Structural Causes," p. 1. 63. Keohane acknowledges that "cooperation need not involve any negotiation at all," but

focuses his attention exclusively on "coordination achieved through bargaining," After Hegemony, p. 76.

64. See Oran R. Young, "Regime Dynamics: The Rise and Fall of International Regimes," in Krasner, International Regimes, pp. 93-113.

65. Keohane, After Hegemony, p. 46.




While Keohane rejects hegemony's explanatory power, he retains the basic theoretical orientation to international politics that hegemonic stability assumes. Hegemonic stability, as a modification of realism, sees regimes as intervening variables between the independent variable of power and the dependent variable of state behavior. In Keohane's own words:

From a theoretical standpoint, regimes can be viewed as intermediate factors, or "intervening variables," between fundamental characteristics of world politics such as the international distribution of power on the one hand the behavior of states . . . on the other.66

The functional theory, as it has been thus far formulated, lacks explanatory variables for regime formation. This is a critical deficiency, since there is a pressing need to explain why the convergence of actors' expectations leads to a change in behavior and rationality.

While logic generally refers to form, not content, rationality, as used in the functional theory, involves both form and content. As Keohane explains, ''rationality" means that actors have "consistent ordered preferences, and that they calculate costs and benefits of alternative courses of action in order to maximize their utility in view of these preferences. "67 In a "self-help system," the formation of a regime in a given issue-area must be preceded by at least a slight change in rationality, a change in preference, otherwise why would the regime not already exist? This change is a special prerequi- site in security issue-areas, where international cooperation runs counter to long-standing tradition.

Traditionally, security has been viewed as a national asset, acquired and enhanced by unilateral decisions and actions. Yet prior to and certainly after the signing of the NPT, a vast majority of nations decided, in a coordinated manner, to eschew the acquisition of the most powerful weapons yet devised and to legitimize the possession of such weapons by a select few. Security (at least as it concerns nuclear weapons) has been redefined through the nonproliferation regime as a situation produced by negotiation and moni- toring rather than as a national resource earned by unilateral effort. Conse- quently, a central question in the analysis of all regimes is why a particular regime was created at a particular moment in history: Why then? Why not earlier? Why not later? The functional theory does not explain the creation and simultaneous convergence of a new interest by a host of states differing widely in history, political culture, and capability. Though the functional theory provides a powerful analytical tool for discerning the dynamics of regime maintenance, it fails to help us understand why a regime was formed at all, because it does not get at why there was a redefinition of egoistic self- interest.

66. Ibid., p. 64. 67. Ibid., p. 27.




An apparent profitable avenue of inquiry to complement the functional theory's explanation of the non-proliferation regime is advanced by Ernst Haas and James Rosenau. Both scholars stress the importance of knowledge and learning as a key variable in explaining regime formation. Haas defines knowledge as "the sum of technical information and of theories about that information which commands sufficient consensus at a given time among interested actors to serve as a guide to public policy designed to achieve some social goal.' '68 Haas argues that knowledge creates a basis for cooperation by illuminating complex interconnections that were previously not understood; the potentialities inherent in "cognitive evolutionism" can bridge ideological cleavage and make possible more cooperative definitions of self-interest.69 Rosenau's conception of the state is that of a "habit-driven actor"; such a conception, however, does not imply constancy, for "among their habits is a readiness to learn from experience and to acquire new skills that may, in turn, facilitate further learning."70 Since states are open to learning, they are capable of changing and can do so in two ways:

(a) when the external stimuli are so persistently and startling different so as to jolt habitual modes and foster new patterns more appropriate to the evolving circumstances; or (b) when new skills, capabilities, and/ or responsibilities develop within the actor, forcing the old habitual ways to yield to new ones.71

It can be argued that the knowledge of what effect nuclear weapons could have on the international system was so "startling different" that the new "skill" of waging nuclear war pushed states toward the formation of new habit.

The knowledge/learning approach to explaining regime formation is particularly appropriate to the nonproliferation regime. As we have seen, neither the distribution of power nor egoistic self-interest provide a complete explanation. Likewise the variables of usage and custom stressed by scholars of the "Grotian school," to use Krasner's taxonomy, are not particularly appropriate to the non-proliferation regime.72 Conventional wisdom on regimes assumes that patterns of behavior lead to the development of convergent expectations, which in turn lead to the formation of regimes. In the case of the non-proliferation regime, it seems clear that it was built not on existing patterns of behavior, but on convergent expectations prior to any well-developed pattern of interaction. To employ Haas's terminology, there was con-

68. Haas, "Why Collaborate?" pp. 367-68. 69. Ernst B. Haas, "Words Can Hurt You; or Who Said What to Whom about Regimes," in

Krasner, International Regimes, pp. 23-59. 70. Rosenau, "Before Cooperation," p. 864. 71. Ibid. 72. See Young, "Regime Dynamics"; and Donald J. Puchala and Raymond F. Hopkins,

"International Regimes: Lessons from Inductive Analysis," in Krasner, International Re- gimes, pp. 61-92.




siderable "substantive linkage" of issues prior to the formation of anything resembling a non-proliferation regime; "substantive linkage" proceeds "on the basis of cognitive developments based on consensual knowledge linked to an agreed social goal."73 Such expectations centered around a need or an agreed social goal that required a "diffuse" sense of reciprocity before any pattern of "specific" reciprocity was formalized or even widely practiced; this runs contrary to Keohane's finding that a sequence of "specific" reciprocity generally precedes the formation of "diffuse" reciprocity.74 Thus, the non-proliferation regime presents an anomaly for some of the most recent international research and theorizing.

Conclusion

The hegemonic stability theory and, in part, the functional theory fail to explain the formation and maintenance of the non-proliferation regime. This failure is partially due to the fact that the latter veers sharply away from its intellectual roots, an attempt to construct a "complex interdependence" model of international relations, while the former denies the validity of such a model.

The complex interdependence model attempted to intergrate the burgeon- ing research of the 1960s and 1970s. Research of that period studied the penetration of the state by a variety of other states and non-state actors (sub- national, supra-national, and transnational); the state was ensnared in a web of varied relationships, all of which eroded its sovereignty. And as the state became increasingly sensitive and vulnerable to forces beyond its control, foreign policy could no longer be insulated from domestic political processes and decisions. In its most fundamental sense, complex interdependence posited an alternative model to that of realism: states are not unitary, rational actors; states, while preeminent, are not the only significant actors on the world stage; multiple channels of communication exist, not just high- level intergovernmental exchanges; there is no seamless web or hierarchy of issues; foreign policy cannot be autonomous from domestic politics; and military force possesses less political utility than is often attributed to it.75 The complex interdependence model, beyond spurring a revival in realist thought,76 has not replaced realism as the dominant paradigm in the study of

73. Haas, "Issue Linkage," p. 372; the "tactical linkage" of issues is used only to obtain additional bargaining leverage, usually after a regime is formed.

74. Keohane, "Reciprocity," passim. 75. The attempt to construct a complex interdependence model is the subject of a special

issue of International Organization (Summer 1971), entitled "Transnational Relations and World Politics" and edited by Robert Keohane and Joseph Nye; and Keohane and Nye, Power and Interdependence.

76. See Waltz, Theory of International Politics, and Robert 0. Keohane, ed., Neorealism and Its Critics (New York: Columbia University Press, 1986).




international relations.77 It has not done so, at least in the realm of regime analysis, because its central tenets have not been applied to regime analysis.

Robert Keohane, one of the most prolific and scholarly students in the field of international relations, is the principal author of the functional theory and one of the leading architects of the complex interdependence school. An ironic twist in Keohane's work is that while less than a decade separates the publication of Power and Interdependence and After Hegemony, the bodies of theory in those two works are scarcely related. The most obvious point of departure is Keohane's differing conceptions of the state. Where once he described states as "multifaceted, even schizophrenic,"78 he now assumes in the functional theory that they are "rational utility maximizers."79 The functional theory begins with a close approximation to a microeconomic model, in which all actors make rational choices, and then relaxes this model only slightly by incorporating the notions of "bounded rationality" and "satisficing" behavior. How Keohane modifies his assumption of rationality brings the functional theory into its second conflict with complex interdependence. Where Keohane once saw a complicated strand of many different relationships and channels of communication as vitally important,80 he now, despite passing references to non-state actors, restricts the focus of his analysis almost exclusively to intergovernmental relations and high-level governmental actors to avoid "theoretical anarchy.' '81 Ironically, it was this "theoretical anarchy" of many actors and multiple channels that was so significant for the study of international politics.

The principal reason for this deviation from the basic premises of complex interdependence is the application of rational choice or game theory to regime analysis. The effect is to present a conception of the dynamics of international politics that is directly at odds with that of complex interdependence. With rational choice, the conception is one of discrete, isolated moves, not an endless flow of decisions overlapping one another on a variety of levels; the conception, according to one critic of rational choice, is of "actors who act toward and react to, rather than interact with, each other."82 Though it seems that a number of distinguished scholars have come to share one observer's confident belief that "game theory brings the contending 'interdependence' and 'Realist' positions together in a common framework,"83 there is at this time reason to regard such confidence with more than a little skepticism.

77. See K. J. Holsti, The Dividing Discipline: Hegemony and Diversity in International Theory (London: Allen and Unwin, 1985).

78. Keohane and Nye, Power and Interdependence, p. 35. 79. Keohane, After Hegemony, p. 83. 80. Keohane and Nye, Power and Interdependence, pp. 33-34. 81. Keohane, "Demand for International Regimes," p. 144. 82. Rosenau, "Before Cooperation," p. 877. 83. Duncan Snidal, "The Game Theory of International Politics," World Politics 38 (October

1985), p. 56.




The principal consequence of this deviation from the basic premises of complex interdependence is that Keohane is, in the words of one thoughtful observer, unable to "follow his discussion of 'issue density' and 'nesting' to its logical conclusions because of the paradigmatic assumptions which con- strain him.' 84 By focusing on unified rational actors' bargaining and negotiation, Keohane and others ignore the role that knowledge and learning may play in the creation and maintenance of regimes. As Stephen Krasner argues, "Knowledge alone is never enough to explain either the creation or functioning of a regime. . . . But knowledge and understanding can affect regimes. If regimes matter, then cognitive understanding can matter as well."85

An alternative explanation of regimes that is more consistent with the evidence underpinning the complex interdependence model and also per- mits consideration of knowledge, as well as power and interest, as explanatory variables for regime formation, is the so-called "Grotian" perspective. The "Grotian" analyst stresses that regimes are social institutions existing at all levels of social life. As Oran Young proclaimed, "We live in a world of regimes. "86 Amplifying on this central premise, two other "Grotians" explain:

a regime exists in every substantive issue area in international relations where there is discernibly patterned behavior. Wherever there is regu- larity in behavior some kinds of principles, norms and rules must exist to account for it.87

The value of recognizing that regimes are more than formal, negotiated arrangements complements the evidence identifying a complex web of en- during practices which exists between and among states. By highlighting the conclusion that regimes are "human artifacts,"88 which are created not dis- covered, the "Grotians" acknowledge that the rise and fall of regimes is more than a mechanicalistic response to changes in the distribution of power or manifestations of rational, egoistic self-interest. The "Grotian" preoccu- pation with usage and custom, while as limited as power or self-interest, is inherently elastic enough to give a central place to knowledge and learning.89

The "Grotian" perspective also accepts the theoretical "anarchy" of a

84. Richard L. O'Meara, "Regimes and Their Implications for International Theory," Mil- lennium: Journal of International Studies (Winter 1984), p. 256.

85. Stephen D. Krasner, "Regimes and the Limits of Realism," in Krasner, International Regimes, p. 368. While Keohane devotes little attention to exploring the role of knowledge and learning in regimes, he is well aware of its potential importance, Keohane, After Hegemony, p. 132.

86. Oran R. Young, "International Regimes: Problems of Concept Formation," World Poli- tics 33 (April 1980), p. 31.

87. Puchala and Hopkins, in Krasner, International Regimes, p. 63. 88. Young, "Problems of Concept Formation," p. 349. 89. See Puchala and Hopkins's discussion of "evolutionary change" in regimes, which oc-

curs without major changes in the distribution of power, in "Lessons from Inductive Analysis," pp. 65-66.




myriad of relations and actors. Young, for instance, identifies the unique two-tier implementation process which characterizes regimes in the international system: "In formal terms, the members of international regimes are sovereign states, though the parties carrying out the actions governed by international regimes are often private entities."90 And Puchala and Hopkins note that each regime contains elites; these "elites" are not states, but rather bureaucratic actors and individuals within states.91 The "Grotians" are heartened by the fact that states are not rational, unitary actors, that to determine the "national self-interest" one must first identify which self and which interest. Such an observation ties in directly with the knowledge that national nuclear decisions are produced by complex processes involving different actors with different interests and perspectives.92 By opening up the "billiard ball," the "Grotian" perspective allows a consideration of how states "learn." In other words, it allows scholars to go beyond the classical utilitarian theory of decision-making in regime analysis, with its assumptions of rational cost-benefit estimation, and include theories that, at times, more closely approximate reality, such as John Steinbruner's "cybernetic theory.'93

Two contemporary explanations for regime formation and maintenance treated here, hegemonic stability and the functional theory, suffer from an analytically limiting parsimony in the realm of independent variables. Power and egoistic self-interest, while important, are not sufficient to adequately explain the appearance and endurance of a set of principles, norms, rules, and decision-making procedures on non-proliferation. Generalizing from the example of the non-proliferation regime, a more promising avenue of research for regime analysis might be amending the functional theory to make it more consistent with the "Grotian" assumptions. Such a theoretical alignment would allow consideration of knowledge and learning to be integrated more centrally into regime analysis. Such an alignment would also be consistent with the research and theorizing of the 1960s and 1970s.

90. Young, "Regime Dynamics," p. 93. 91. Puchala and Hopkins, "Lessons from Inductive Analysis," p. 63. 92. See Herbert Kitschelt, "Four Theories of Public Policy Making and Fast Breeder Reac-

tor Development," International Organization 40 (Winter 1986), pp. 65-105. 93. John D. Steinbruner, The Cybernetric Theory of Decision: New Dimensions of Political

Analysis (Princeton: Princeton University Press, 1974).



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Explaining the Non-Proliferation Regime: Anomalies for Contemporary International Relations Theory