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Translating Intent into Action: ImplementingEnvironmental CommitmentsDavid G. Victor a & Eugene B. Skolnikoff ba Council on Foreign Relations in New Yorkb Massachusetts Institute of Technology in Cambridge , MassachusettsPublished online: 05 Nov 2012.

To cite this article: David G. Victor & Eugene B. Skolnikoff (1999) Translating Intent into Action: ImplementingEnvironmental Commitments, Environment: Science and Policy for Sustainable Development, 41:2, 16-44, DOI:10.1080/00139157.1999.10544061

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Many environmental problem s are

internati onal : their causes or con­

sequenL'es cross political borders. Com­

bating these prob lems requires coordi ­

nation among states. In nearly everv

case . states have responded to trans­

bound ary environmental problems via

internat ional agreements. The pace of

negotiating such agreements has been

swi ft and increasing. More than one­

half o r the 170 multilateral environ­

mental agreements now on the United

Nations list were added in the last 25

vears. Much of the canon of interna­

tiona l environmental law. inc ludi ng

ag ree ments on track in hazard ous

wastes. global warming. and depletion

of the stratospheric ozone layer. has

been adopted only in the last decade.

Given the rapid expansion of inter­

national environmental agreements. it

is natural to as k wheth er and how thev

have been effect ive. To address these

quest ions. the International Instirute

for Appli ed Sys tem s Analysis

(IIASA ). a nongovernm enta l research

instit ute based in Laxenbu rg. Austria.

sponsored a project entitled " Imple­

ment ation and Effecti veness of Inter­

nati onal Environm ent al Co mmit-

~avid G. Victor and'---_

ments' (IEC). The focus of the project

was the process of imp lementation­

how intent translates into ac tion to

so lve intern ati on al environme nta l

problem s. Among the products of this

multidi sciplinary e ffo rt involving two

dozen scholars were 14 historical case

studies on topic s ranging from the reg­

ulation of ac id rain in Europe to the

limitati on or trade in hazardous chem­

icals and pes ticides. These studies.

which form the basis or this article and

are presen ted in a recent bOOK. are

summar ized in Table 1 on page 18.

Study parti cipants examined two

c ruc ial as pec ts 01' imp lem entati on:

how national governments and stake­

holders have translated international

co mmitments into national ru les and

changes in behavior : and how interna­

tional institution s have aided the mon­

itoring, enforce ment, and adjustment

of internati onal agreements. For near ­

lv all the interna tional environmental

problems on the age nda toda y. inade-

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Regulation of whaling in Iceland and Norway

Implementation of controls in the formerSoviet Union

Implementation of North Sea pollution controlsin the Netherlands, Norway, and the UnitedKingdom

quate attention to implementation atboth the national and international lev­els is a large part of the reason whyinternational agreements have fallenshort of their promise . And as the pol­icy agenda has grown more demand­ing, requiring that international agree­ments play an even greater role incoordinating the behavior of nationalgovernments, private firms, and indi­viduals, the importance of implemen­tation has grown.

At the national level, special atten­tion was given to the many efforts bypolicymakers to engage stakeholders.Contrary to fears that stakeholderswould take over and capture the processof regulation, we found that activeefforts to engage industry and environ­mental nongovernmental organizations(NGOs) were often a boon. Typically,stakeholders- not governments-hadthe information necessary to design andimplement effective regulatory pro­grams. Getting stakeholders involvedmade it easier to design and implementmore effective environmental protec­tion. The most successful efforts toengage stakeholders have been thosethat have altered the incentives for themto participate-for example, by makinguseful environmental data available sothat public interest groups could partic­ipate on an equal footing with privatefirms and governments. Formal rules,such as granting NGOs access to fora,were much less important.

Several of the IEC studies focused onnational implementation in countriesthat are undergoing a transition fromcentral planning. Because these coun­tries also host some of the worst envi­ronmental problems, putting effectiveregulatory programs into place therecould dramatically reduce internationalproblems-acid rain and the fouling ofthe Baltic Sea, for example-while alsocutting severe local smog and contami­nated drinking water. The studiesshowed that efforts to build market­based, democratic institutions in theformer communist countries are alsomaking possible more effective imple­mentation of international environmen-

tal commitments. But in Russia-by farthe largest of the transition countriesand home to many of the most severeenvironmental threats-many otherfactors have hobbled implementation.Western assis tance has had someimpact, but much less than hoped andclaimed by donors.

Our studies confirm that nearly allgovernments comply with nearly alltheir binding international environ­mental obligations. However, in thepast, high compliance with interna­tional environmental commi tmentsoften reflected the fact that the com­mitments were fairly trivial , in manycases simply codifying rather thanchanging behavior. But the effective­ness of those commitments in lessen­ing environmental problems was alsolow. Incentives to cheat were few andthe need for strict monitoring andenforcement was low. As efforts to

Table 1. The isc case studies

Issue

Conservation and preservationof fauna and flora

Stratospheric ozone depletion

Baltic Sea pollution

Trade in hazardous chemicalsand pesticides

Acid rain in Europe

North Sea pollution

Whaling

Marine dumping of nuclear waste

tackle environmental probl ems haveinten sified, how ever, commitmentshave become more dem anding andthus the incenti ves to chea t havegrown. For this reason, stricter moni­toring and enforcement are increa s­ingly essential to ensuring that thosecomm itments are implemented fully.The historical record of high compli­ance without much monitoring andenforcement is a poor indicator ofwhat will be needed for more effectiveinternational enviro nmental protec­tion in the future .

Although sys tematic review ofimplementation is commonplace innational regulatory programs, the sys­tematic monitoring, assessment, andhandling of implementation failuresby interna tional institutions is relative­ly rare. Nonetheless, efforts to providesuch review are growing. The IIASAproject found that formal mechanisms

Case Study

Long-term trends in systems forimplementation review

The Montreal protocol's system forimplementation review

The Montreal protocol 's noncomplia nceprocedure

The Baltic regime's system for implementationreview

Implementat ion in the former Soviet UnionImplementation in Poland

The United Nations Environment Pro­gramme/Food and Agriculture Organizationscheme for prior informed consent

Review and modeling system for air pollutiondata

Implementat ion of nitrogen oxide controls inthe Netherlands , Norway, and the UnitedKingdom

Implementat ion in the former Soviet UnionImplementation of contro ls on Norilsk Nickel

18 ENVIRO NM ENT M ARCH 1999

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for implementation review exist innearly every recent internati onal envi­ronmental agreement. In addition,many informal mechanisms to reviewimplementation and handle cases ofnoncompli ance often operate in tan­dem with the form al mechanisms.Together, these formal and inform almechanisms form what the IIAS Aresearchers termed "systems forimplementation review."

The true capacity of an internationalenvironmental regime to spot and han­dle cases of poor implementation andto adjust commitments over time canbe assessed only by looking at the for­mal and inform al mechanisms togeth­er. For example, the most effectiveincentives for Russia to comply withthe Montreal protocol proved to be amix of subsidies and threatened sanc­tions, only some of which were actual­ly formally authorized and implement­ed und er the protocol. Blendingformal and informal measures is nec­essary because many countries havebeen unwilling to accept internati onalagreements that include strict , auto­mat ic, and formalized mechanisms formonitoring and enforcement.

We present below in more detail theIIASA project's findings concerningimplementation at the national andinternational levels in more detail.Because the res ults often differedappreciably from our expectations, thediscussion is framed in terms ofexpectat ions versus findings.

National Implementation

Most of the case studies examinedthe critical processes by which interna­tional environmental commitments areput into practice at the national level.The studies traced implementation inWestern , market-based countries aswell as in countries (mainly Russia)that are undergo ing a transit ion to a lib­eral, market-based society.1

The studies demonstrate that there isno standard implementati on process.Even simil ar countries adopt very dif­ferent approaches, and within coun-

tri es the impleme ntation processvaries markedl y among sectors .Because these differences make gener­alization difficult , study particip antsfound that it was crucia l to narrow the

inquiry. As a result, the case studiesfocu sed on two major aspects ofnational implementation: how patternsof participation and the process oftransition to a market econ omy haveaffected efforts to implement interna­tional commitments.

Participation

A striking attribute of efforts tomanage environmental problems is theparti cipation of many stakeholders,including government agencies, indus­try, and environmental pre ssuregroups. Dur ing the last two decades,participation has expanded dramatical­ly. Previou sly, access to internationaland national policy processes had beenlimited to government officials and afew "insider" industries. Today, a widerange of public interest gro ups alsohave form al access, and there are callsfor still further expansion. In parallelwith rising participation, the policyagenda more often includes environ­mental problems that intrinsicallyaffect a large number of stakehold-

ers- problems that are caused bybehavior that is pervasive in socie ty.For instance, several of the IEC stud­ies focused on polluti on that flows into the Baltic and North Seas from the

diverse activrties of farmers, house­holds, firms, and municipaliti es. Envi­ronm ental problems of this kind aredifficult to manage because they oftenaffect and require the regulation ofthousands or even million s of actorsrather than a well-defined sector orgroup.· The IEC studies focused onhow these numerous stakeholders par­ticipate in the implementation processand on whether patterns of participa­tion matter.

Expectation: Patterns of participa­tion influence both policy decisionsand implementation.

Finding: Rising participation hascert ainly affected the process of mak­ing and implementing internationalenvironmental commitments. Effortsto expand participation have typicallyresulted in greater access and influ­ence for public interest NOOs. Asthese interest groups have gained astronger voice, the result often hasbeen bolder environmental commit­ments and policies. But the impact ofrisin g parti cipat ion on beha vior-

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which is ultimately what mattersmost-is less clear. In many cases,bold commitments and policies haveactuall y led to little change in thebehavi or that causes environmentaldegrad ation. However, we found thatparticipation by the "targets" of regu-

lation (usually industry) has made reg­ulation more effective. Targets provideinvaluable informati on on the feasibil­ity of different options for implement­ing international commitments. Thatinformation, which is often not avail­able elsewhere, can yield policies thatare more realistic and ultimately moreeffective because they better reflectindustry's interests and capabilities.

Although participation by targetsyields many benefits, it also imposesrisks. The most dangerous is that open­ing access to more stakeholders couldyield policy that merely reflects specialinterests. As expected, IEC found thatthe risks of "regulatory capture" declinesharply when groups with countervail­ing interests also participate. Far fromexcusing government from the functionof analyzing and imposing public poli­cy, expanding the participation ofNGOs requires active management.

Expectation: Oversight by environ­mental NGOs is extensive.

Finding: Today it is widely assertedthat NGOs playa central role in moni­toring and enforcing compliance withinternati onal environm ental commit­ments. NGOs are crucial, it is claimed,because they ensure that governmentslive up to their international obliga-

tions. The IEC studies foundthat in democratic industrialcountries NGOs do providesome broad oversight so thatflagrant violations of interna­tional commitments by thesecountries are rare. But onlyrarely do NGO s sponta­neously emerge to providesystematic supervision ofthe implementation process.Rather, in most area s ofinternational environmentallaw, NGOs have focused onsetting the agenda rather thanon implementation.

The IEC studies suggestthat independent oversightand enforcement are rarelyperformed by NGOs becausesuch functions require exten-sive information, which is

expensive to obtain. The exceptionsinclude international efforts to protectwildlife, such as the agreements to reg­ulate trade in endangered species,where public interest NGOs have beenin operation for decades, slowly build­ing the databases and networks that arecrucial to monitoring and enforcement.Other exceptions include cases whereNGOs derive direct benefits, such asthe highly visible actors to block oceandumping and whaling. But the newerenvironmental problems caused byhighly diffuse activities often do notlend themselves to such high-profileenforcement activities. In such cases,many individual actors contribute onlya minor part of the total problem; few,if any, are attractive villains.

The IIASA researchers concludedthat balanced participation-by targetgroups as well as by other NGOs- iscrucial, especially because in mostcases national governments and inter­national institutions cannot take all of

the actions necessary to address theenvironmental issues on the agendatoday. Interestingly, one of the mostobvious policy tools for achieving thisbalance of participation-changingthe rules of access for potenti al partic­ipants-often has little influence onwho participate s, the policies thatresult , or their practical influe nce .Much more important are the costsand benefits of participation, whichare difficult for policymakers to influ­ence directly. In the effort to protectthe North Sea, for example, the pat­terns of participation (both inside themajor state s and in the internationalnegotiating fora) were not muchaffected by changes in the formal rulesof access. Rather, NGOs took on theseissues and their parti cip ation thusincreased; more lenient rules for for­mal access to meetings and documentsfollowed later. These results suggestthat current polic y debates, whichemphasize the importance of formallyallowing NGOs greater access to poli­cymaking fora, are somewhat misdi­rected. Formal access is sometimesnecessary, but it is not the most impor­tant factor.

Societies in Transition

Countries that are making the transi­tion from central planning face-andhave caused-some of the most severeenvironmental problems. Nuclear fall­out from the Chernobyl accident is themost notorious example, but the for­mer centrally planned countries alsohave been among the largest contribu­tors to acid rain in Europe, pollution ofinternational rivers and seas, emissionsof greenhouse gases , and dumping ofhazardous wastes. In addition, the mostserious failures to comply with theMontreal protocol on stratosphericozone depletion are all by countriesthat are undergoing transition." Russiareceived primary attention in the IECproject because of its sheer size andimportance. Indeed, consumption offossil fuels in the Russian Federation ismore than twice that of all other transi-

(continued on page 39)

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Translating Intent into Action(continued fro m page 20)

tion countries combined and exceedsthe total in France, Germany, and theUnited Kingdom .

Expectation: Transition is disrup­tive and thus impedes implementationofenvironmental commitments.

Finding: The effectiveness of envi­ronm ental commitments in transitioncountries has been mixed. As expec t­ed, transition has caused regulatoryproblems because of poor regulatoryinstitutions, decentrali zation , and inef­fective environm ental tax collection.Because the cha ins of dec is ionsrequ ired to implement policies havegrown more complex, the opportuni­ties for implementation failure haveincreased. Far more actors now play arole in policy actions than was the caseunder central plannin g. The shift fromcentral cont rol has suddenly presentedthese countries with the same chal­lenge that Western countr ies haveface d for several decades: how tochange the behavior of large numb ersof dispersed actors.

In general, the case studies show thatin Russia the transition has not led torampant noncompli ance with the coun­try's international commitments. How­ever, in most cases "compliance" ismerely the result of reduced economicoutput leading to a significant drop inpollution. In many cases, pollut ionintensity (i.e., pollution per unit of eco­nomic activity) has actually risen. Forexample, official statistics show thateconomic activity in St. Petersburg hasdropped 50 percent while pollu tion hasdeclined only 10 percent.

Our analysis is quite pessimistic:Until new regulatory structures takehold , environmental regulation willremain ineffect ive. In cases whereimplementation requires costly invest­ments, such as build ing wastewatertreatment plants to reduce the pollu­tion flowin g into rivers and the BalticSea , carefully directed financial ortechnology transfers may be essential

unt il n sing profits fro m econom icrecovery are available .

There are, however, a few brightspots : Transition has also broughtmany benefits, includin g more rationalpricing of resources and more openpolitical systems . In some cases, liber­al politics has led to more stringentenvironmental policies. For example,policies to limit marine dumping ofnucl ear waste in Ru ssiahave been a direct conse­quence of wider participa­tion and the wider availabil­ity of informati on to andgreate r parti cip ation byenvironmental groups andthe parliament in the policyprocess. However, thosebenefits were short-lived. Inrecent years the Russiangovernment has actively sti­fled the abil ity of civil soci­ety to organize and influ­ence public policy. Of all thecountries studied, Ru ssiawas the only one where participationby environmental NGOs has declined.In most of the former Soviet Union,implementat ion of policies remainspoor ; the environmental benefits oftransition are not yet much in evidence.

Ex pectation: The West can help alot, especially with fi nancial transfers.

Finding : International resources canbe important but are generally not deci­sive. Indeed, it is rare that externalresources provide more than one-quar­ter of the total funding for environmen­tal projects. In theory, financial transferschemes-often called joint implem en­tation (JI)-can yield significant effi­ciency gains, but the lEe studies showthat implementing those transfers canbe highly complicated under conditionsof transition, where property rights tendto be unstable and the enforcement ofcontracts is poor. We consider financialtransfers in more detail later.

Implementation Review

Because regulation of many diffuseactors is often complex, governments

cannot be sure in advance whethertheir efforts to put internati onal com­mitmen ts into practice will be success­ful. Moreover, some governments mayintentionally violate their internationalobligations. Thu s, there is a need toreview implementation and handle theprobl ems that arise. Implementationreview can also make it easier to iden­tify problem s with existing agree-

ments, which can aid the process ofrenegotiation and adju stment. Suchreview processes are especially vitalwhen complex and uncertain problemsare on the international environmentalagenda. Those problems, such as waterpollut ion from land-based sources andglobal warming, are poorly understoodand involve thou sands or even millionsof stakeholders. Only through an evo­lutionary process that promotes learn­ing and adjustment can the most effec­tive international commitment s beidentified and implemented.

The IIASA researchers found thatintern ational agreeme nts that includeprocedures for ga thering and review­ing information on implementationand handling implementati on prob ­lem s are more likely to be effectivethan those where litt le effort has beengiven to developing the functions ofimpl ementation review. Howe ver,until now implem ent ation review hasneith er been the topic of much re­search nor high on the pol icy agenda.In part , that is due to the fact thatman y international enviro nmenta l

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comm itments have not been demand­ing: Because countries have had littlereason to violate the agreements, theneed for implementation review hasbeen minimal. Yet in every agreementthe IIASA researchers studied, coun­tries ' commitments generally havebecome more stringent and the costand complexity of implementation hasrisen over time. Thu s, the need foreffecti ve implementation review hasbeen growin g.

Expectation: Systems f or verifica­tion and enf orcement are poor:

Finding: Research completed priorto the IEC project had demonstratedthat formal mechanisms for implemen­tation review were scarce, weak, orrarely used. For example, most envi­ronmental agreement s required gov­ernment s to report data on their com­pliance, but the reports were typicallylate, incomplete , and not useful.' TheIEC studies show that the situation isnot so bleak, however. In every agree­ment examined, governments arereporting more useful data than before.Moreover, in practice , implementationreviews are actually being carried out.Previous studies missed the full extentof this activity because they focused onform al procedures. We found thatmuch implementation review is per­formed by institutions and actors thatare not formally charged with thisfunction. In the Baltic Sea regime, forinstance, there has been extensiveimplementation review even though(until recently) no organization hadbeen formally charged with reviewingimplementation of the Baltic Sea 'slegal conventions.

The IEC studies demonstrate thatthese decentralized (and often infor­mal) activities are generally synergis­tic with the formal procedures thatexist in some international environ­mental agreements. The resulting sys­tem for implementation review hasimproved the effectiveness of everyagreement we studied- it made par­ties more accountable for the imple­mentation of their commitments;helped to direct assistance that facili -

tates compliance; and provided infor­mation and assessments that make iteasier to adjust agreements over time.

This novel system per spectiveunderscores the need to look farbeyond the formal procedures whenstudying and designing the institutionsthat review implementation. Indeed,some of the most politi cally sensitive

tasks, such as making financial assis­tance conditional upon adequateimplementation performance, areoften best handled in an ad hoc fashionby institutions that are not formallycharged with the task of implementa­tion review. Formal review mecha­nisms (even weak ones) are nonethe­less important-they help ensure thatad hoc and informal efforts operate inconcert . But policy efforts to makeagreements more effective shouldfocus not only on creatin g formal pro­cedures but also in facilitating theequally import ant informal activities.

Expectation: International law isweak because strong "enf orcement "tools are not available; thus interna­tional institutions can do no more than"manage " violations of internationalcommitments.

Finding: The IEC studies confirmwhat has been widely claimed, name-

Iy, that most implementation failuresare managed with "soft" measuressuch as persuasion and negotiation.But the studies also show that theregimes that have elicited the mostcooperation (such as the Montreal pro­tocol) have at their disposal more pow­erful carrot s and sticks that they use toenforce international obligations. Con-

trary to our expectations, such toolsare increasingly being used, and theywork-especially when the sanctionhas been to withdraw financial assis­tance . In the Montreal protocol, forexample, developing countries that donot fulfill their obligations to reportdata are cut off from the protocol' sMultilateral Fund, which pays muchof the cost of implementing thesecountries ' commitments under the pro­tocol. In every case, the threat of a cut­off has brought swift compliance. Thecombination of soft management­backed by stricter enforcement whennecessary-has been effecti ve. Themost flagrant violations have beendeterred and reversed only whenstrong incentives, including threats oftrade sanctions, have been applied}

Expectation: National data report­ing is incomplete.

Finding: Data are the backbone of

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can indeed be effective-the tragedy isnot inevitable.

However, the con ditions underwhich international institutions havebeen most effective do not alwaysexist. Cooperation is most effectivewhen socie ties are already stronglycommitted to environmental protec­tion. Typically, those societies are theadvanced indu stri al dem ocracies,where environmental action has beencatalyzed by visible and severe envi­ronmenta l probl ems such as sea ldeaths and algal blooms in the NorthSea. As the international environmen­tal agenda expands, effective coopera­tion will require engaging countriesthat have been more reluctant to paythe costs of environmental protection.Their response will depend, in part, onthe spread of environmental valuesand whether politi cal structures areresponsive to public concerns.

In some cases, international institu­tions have made cooperation muchmore effective by compensating reluc­tant countries for the costs of imple­mentin g international environmentalcommitments. The Montreal protocol'sMultilateral Fund, which pays devel­oping countries the full extra cost ofcomplying with the protocol, is thebest example. Others include bilateral

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MONTEREY INSTITUTE OF INTERNATIONALSTUDIES425 VAN BUREN STREET . MONTEREY. CA 93940 USATEL (83I) 647-6543 • FAX (831) 647-4199E-Mail cgarrett@miis .edu • www.miis .edu

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region) or the shock of mysterious sealdeaths in the North Sea (which galva­nized public concern) have been themost importan t turning points inaddress ing environmental probl ems.Moreover, intrinsic features of prob­lems, such as the costs and benefits ofregulating certain activities, stronglydetermine which efforts to addressinternational environmental degrada­tion will be most consequential.

Institutions and agreements makecooperation easier, but rarely are theydecisive. Nonetheless, they are themain tools available to policymakers.The IEC research shows how to makethem more effective. The IIASA workis relevant for four topics that theoristsand policymakers regularly address.

First, can the "tragedy of the com­mons" be solved? When the environ­ment is available to everyone, andnobody pays the full cost of environ­ment al degradati on, tragedy ofte nresults. Each individual may degradeonly a small part, but collectively theenvironment is destroyed.' One typicalreply to this tragedy is regulation. Butmost observers conclude that interna­tional regulation is bound to be inef­fective because international institu­tions are weak. The IIASA researchshows that international institutions

Implications

implementation review; without gooddata, systems of implementat ion re­view work poorly or not at all. Mostdata are supplied by national govern­ments in the form of regular reports .The IEC studies show that the problemof late and incomplete data is beingsolved-reporting rates have risen fornearly all count ries in nearly all of theagreements that were studied. (In afew cases, such as the Montreal proto­col, high reporting rates are made pos­sible because the costs of reporting aresubsidized and other benefits of inter­national cooperation are made condi­tional upon reporting.)

A more intractable problem re­mains, however: poor data quality.National data are often inaccurate andnot comparable, which impedes all butthe simplest reviews of implementa­tion. The only effect ive response tosuch problems has been extensive pro­grams to improve data repor ting,backed by efforts to build institutionsthat use and compare data. Suchcapacity requires much time to build,typically at least a decade of activesupport. We found that data on poli­cies and implementation plan s areespecially poor; yet such informationis necess ary if implementation reviewis to determine whether countries areon track to meet commitments in thefuture, rather than merely assessingafter the fact whether countries havecomplied. Only a forward-lookingsys tem can tackle implementationproblems before they becom e fullblown and identify adjustments thatare needed to make international a­greements more effective.

Just how effective are internationalinstitutions and agreements at changingthe behaviors that cause environmentalproblems? The IEC research shows thatmost changes in behavior have not beena consequence of institutions and agree­ments. Rather, external factors, such asthe end of the Cold War (which hadimpeded cooperation in the Baltic

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funding programs, such as aid for pro­jects to limit pollution that flows intothe Baltic Sea from countries undergo­ing economic transition. Compensa­tion can be vital , but in cases where theprice tag is high (such as global warm­ing) compensation alone may not beadequate. Different incentives, such astrade sanctions and other penalties,may be needed in those cases. To date,sanctions have been used rarely, butwhen applied they have often beeneffective. A looming challenge is todetermine when and how sanctions canbe made compatible with internationaltrade rules . Potential conflicts betweenthe sanctions that have sometimes beenvital to international environmentalcooperation and free-trade rules thatdiscourage sanctions have not beentested or settled .

Second, what do the IEC studiesreveal about the use and effectivenessof market-based mechanisms for pro-

tecting the environment? Experienceat the national level, especially in theUnited States, shows that mechanismssuch as tradable emissions permits oreffluent fees encourage firms to findthe least costly means of protecting theenvironment. The same logic couldbe applied at the international level.

Indeed, the 1997 Kyoto protocol envi­sions creating a system of internation­ally tradable emission rights that canbe used to lower the cost of cuttingemissions of greenhouse gases .

The most important lesson from theIEC project is that the internationaluse of market-based incentives is vir­gin territory. There are no direct his­torical precedents, and there is muchto be learned about the institutionsthat will be needed for successfulinternational use of market-based sys­tems . Experience at the national levelstrongly suggests that monitoring andenforcement are vital for effectivemarket-based systems. The IEC stud­ies show that these functions general­ly have not been well performed byinternational institutions. In instanceswhere monitoring and enforcementhave been most effective, such as Rus­sia's noncompliance with the Montre­al protocol, critical functions have

been performed by means of informalarrangements . That does not bode wellfor market-based systems, which are(probably) most effective when sup­ported by the transparent, systematic,and formal rule of law. Better institu­tions for monitoring and enforcementwill be needed if market-based institu-

tions are to operate effectively at theinternational level.

Several of the IEC studies exam­ined bilateral financial transfers of thetype likely to occur under joint imple­mentation. In this arrangement, whichis similar to emission trading, a down­wind or downstream country investsin projects that reduce the pollutionfrom an upwind or upstream source.Often the investor's own facilities arealready relatively clean, and thus it ismuch cheaper to control pollutionelsewhere-financial transfers allowfor a cleaner environment at lowercost." The experience with Baltic Seapollution control , where mainly West­ern European governments invested inpollution control in the Eastern Euro­pean littoral states, shows that 11 canwork . That experience also confirmsthat the level of 11 activity dependshea vily on the ability to identify,negotiate, and implement projects­factors that are often termed "transac­tion costs ." Such projects have beennumerous in countries and sectorswhere transaction costs have beenlow. But elsewhere market-driven 11activity has been scant. One particu­larly severe impediment has been thedifficulty of obtaining a secure con­tract in countries like Russia, wherepolitical power has become fragment­ed, property rights are uncertain, andthe legal system is poor. The IIASAresearchers' study of the faileddecade-long effort by Finland, Swe­den, and Norway to clean up a nickelsmelter on Russia 's Kola Peninsulaillustrates that these conditions oftenblock 1I-type financial transfers .'

Third, the IEC studies contribute tothe ongoing debate in the social sci­ences that is often termed "the newinstitutionalism." This debate con­cerns whether and how institutionsaffect the behavior of people and soci­eties . The IEC studies clearly showthat international institutions canaffect behavior. They also reveal howpolicy choices in the des ign of institu­tions can affect outcomes.

One area of particular interest con-

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cern s the choice between binding andnonbinding agreements.' The IIASAresearch confirms what many othershave claimed: Compliance with legal­ly binding commitments has beenhigh. But as suggested previ­ously, the level of complianceis a poor indicator of whetherinstitutions have actually hadan effect on behavior: In thepast, governments made a spe­cial effort to ratify only thosecommitments with which theycould easily comply.

Compliance with nonbind­ing commitments has beenlower, but ironicall y we foundthat such commitments oftenhave a larger influence onbeh avior. For example, the"prior informed consent"(PIC) scheme to regulate tradein hazardous chemicals andpesticides became more effec­tive over time due to rapidlearning and adjustment with experi­ence . In that case and many others,governments were more willing toexperiment with ambitiou s commit­ments because the obligations werecodified in nonbinding form.

When flexibility, learning, and rapidadjustment are important, a nonbind­ing agreement is more effective than abindin g one. But nonbindin g commit­ments are not always superior. Likeother forms of international coopera­tion , agents must have an interest inaddressing the problem at hand. More­over, learning and adjustment, thehallmarks of a nonbinding approach,occur mainly when there is extensivereview of implementation-that is,when systems for implementationreview are active. Moreover, nonbind ­ing agreem ents do not appear effectivein deterring willful violations. In thosecases, a binding approach may bemore effective. The IEC studies ofcooperation in the North Sea and theBaltic Sea show that a hybrid ap­proach may be best: nonbinding com­mitments to set the pace and generaldirection of cooperation, and binding

commitments to codify specific prac­tices and standards into law.

These findings suggest that non­binding agreements would be moreeffective in the early stages of han-

dling the new generation of environ­mental problems, such as globalwarming and loss of biological diver­sity. These problems are marked bythe need for sometimes costly butuncertain changes in behavior. Flexi­bility can promote ambitious coopera­tion and learning , with the best solu­tions later codified into binding law.This finding differs sharply from con­ventional wisdom, which maintainsthat the most effective internationalregimes are those built on legally bind­ing treaties.

The fourth and final issue concernsthe role of governments. Manyobservers have declared that govern­ment is on the decline. In its stead iscivil society, represented by NGOssuch as public interest groups andindustry associations. IIASA's researchconfirms that participation by civilsociety has grown dramatically.Indeed , most international environ­mental issues are on the agendabecause public concerns put themthere. However, while the spread ofdemocratic decisionmaking has, bydesign, limited the power of the state,

governments still negotiate , sign, andratify agreements. Thus, governmentaldecisionmaking processes ultimatelydetermine the content of internationallaw. Moreover, often only governments

have the resources to run costlyprograms in the public interest ,such as data gathering andresearch that are essential tonegotiating and maintainingeffective international environ­mental commitments. Indeed,as modern societies becomemore democratic and market­based, the need for an entity toperform these functions willgrow-acting alone, no privateactor will provide these essen­tial public goods. Governmentsrecognize that ecological inter­dependence reduces their abilityto act unilaterally. Nearly everycountry on Earth participates inat least a few international envi-ronmental agreements, and

most countries are active members ofseveral dozen. But ecological interde­pendence has not removed govern­ments from the scene; rather, it hasforced them to find ways to use thetools of international cooperation tocoordinate their behavior. The IECstudies show that, increasingly, theyare succeeding.

David G. Victor is the Robert W. Johnson. Jr.• Fellowfor Science and Technology at the Council on ForeignRelations in New York. Eugene B. Skolnikoff is anemeritus professor of political science at the Massa­chusetts Institute of Technology in Cambridge, Massa­chusetts. The authors joi ntly led the project on whichthis article is based. They may be contacted throughVictor at the Council on Foreign Relations, 58 East68th Street, New York, NY 10021 (telephone: 212-434­962 1; e-mail: dgvictor@cfr.org).

The other participants in the project were SteinarAndresen. Olav Schram Stokke, Jon Birger Skjaerseth,and Jergen Wettestad of the Fridtjof Nansen Institute.Norway; Helmut Breitmeier of the University of Darm­stadt, Germany; Ronnie Hjorth of Linkiiping Universi­ty, Sweden; Owen Greene and Julian Salt of the Uni­versity of Bradford, United Kingdom; John Lanchberyof the Verification Technology Information Centre.United Kingdom; Mark Levy of CIESIN and ColumbiaUniversity, New York; Elena Nikitina and AlexeiRoginko of the Russian Acade my of Science s;Vladimir Kotov of the Academ y of Transport, Russia;Edward Parson of Harvard University, Cambridge,Massachusetts; Juan Car los di Primio of Karlsruhe,Germany; Oran Young of Dartmouth College, Hanover.New Hampshire; and Michael ZOrnof the University ofBremen, Germany. The advisory committee included

VOLUME 41 NUMB ER 2 ENVIRO NMENT 43

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Abram Chaye s of Harvard Law School, Cambridge,Massachusetts; Gueorgui S. Golitsyn of the Institute ofAtm ospheric Physics. Russia; Peter Sand of the Uni­versity of Mun ich. German y; and Arild Underdal of theUniversity of Oslo, Norw ay. We benefitted from theregular pani cipa tion of Tom Schell ing of the Universi­ty of Maryland, College Park, and Chris Stone of theUniversity of Southe rn California, Los Angeles, in theproject's activities.

The views expressed in this art icle are the authors' ow nand not necessarily those of IIASA or its memberorganizations. An earl ier version of th is articleappeared in the Spring 1997 issue of IIASA' s Opt ionsmagazine. Th e research is presented in more detail inD. G. Victor. K. RaustiaIa, and E. B. Skolnikoff, eds.•The Implementa tion and Effectiveness of Internat ionalEnvironmental Commitments: Theon' and Practice(Cambridge. Mass.: MIT Press, 1998). A list of otherpublications stemming from the lEe project is avail­able at http ://ww w.iiasa.ac.atJResearchlIEC.

NOTES

I . For more on the method s employed by the study.see D. G, Victor. K. Raustiala, and E. B. Skolnikoff,eds., The Impl ementation and Effectiveness of Interna ­tional Environmental Commitments: Theory and Prac­tice (Cambridge, Mass.: MIT Press. 1998), chapter 1.In addition to conducting historical case studies. theproject sponsored an effort to build a " regimes data­base" of all the major variables that contribute to theeffec tiveness of internationa l environmental commit­ments as a research tool.

2. For a review of the project' s conclusions conc ern ­ing countries with economies in transition, see Victor et

al., note I above; and V. Kotov et al., " Implementationof Intern ational Environmental Comm itment s in Coun­tries in Transition ," MOcr-MOST Economic Policy illTransition Economies 7, no. 2 (1997): 103.

3. See General Accounting Office. Internation alEnvironment: International Agreements A re Not WellMonitored, GAO/R CED-92-43 (Washin gton, D.C. .1992); and 1. H. Ausubel and D. G. Victor, "Verifica­tion of International Envir onm ental Agreements: 'Annua l Review of Energy and Environment vol. ]7(1992 ): 1.

4. For more on the debate between the managementand enforceme nt approac hes. see A. Chayes and A. H.Chayes , The Nell' Sovereignty (Cambridge, Mass.: Har­vard University Press. 1996).

5. See J. Burger and M. Gochfeld, "The Tragedy ofthe Commons 30 Years Later ," Environment, December1998, 4 ; and the commentaries beginning on page 4 ofthis issue .

6. For more on joint impl ementation. see L. D. D.Harvey and E. J. Bush, "Joint Implementation: AnEffect ive Strategy for Combating Global Warming" ."Environment, October 1997. 14; and the commentariesbeginning on page 44 of the Novemb er 1997 issue .

7. See V. Kotov and E. Nikitina, "Norilsk Nickel:Russia Wrestles with an Old Polluter: ' Environment,Novemb er 1996. 6.

8. For a review of the IEC project's findings on theuse and effectivene ss of nonbind ing agr eements.including the co nditions under which nonbindingregimes are more effective than binding ones ; ways thatnonbi nding and binding agreeme nts can be used in tan­dem ; and the impl ications for policy, see Victor et al..note I above, chapter 16; and D. G , Victor, "The Useand Effec tiveness of Nonbinding Instrum ents in theManage ment of Complex International Environmenta lProblems," Proceedings of the America" Society ofIntern ational Law , 9 1st annual meeting, 1997,241.

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