Five Questions on Comparative Regionalism

You have written widely on the role of regional organizations in advancing—or retarding—the prospects for democratic rule. How did your earlier work tackle these problems?

I became interested in the phenomenon of European regionalism in the early 2000s, when I was a PhD student at the European University Institute in Florence. Many of my classmates were excited about EU enlargement and its implications for candidate countries, as well as for democratization in Central and Eastern Europe. But EU membership was never a realistic possibility for Russia, and thus the well-known EU “carrot-and-stick” mechanism of democracy promotion was far less applicable to Russia than to the EU candidate states.

Nevertheless, the EU’s impact on democratization inspired many scholars, and my early research examined how the EU promoted democracy not only at the national level but also at the subnational level. The EU’s role in democratization within Russian regions presented a particularly intriguing case from both scholarly and policy perspectives.

At the same time, while European integration was deepening, the 1990s also witnessed processes of political disintegration across Eurasia. The collapse of the Soviet Union led to the establishment of the Commonwealth of Independent States (CIS) in 1991, a new regional international organization (RIO). Philippe Schmitter, with a long history of studying regionalism and democratization, and Michael Keating, who studied regionalization, inspired me to adopt a comparative perspective on how the CIS resembled and differed from the EU. Bringing together these two perspectives—EU influence on democratization and the role of regionalization and decentralization in political transformation—became the central focus of my research and shaped much of my subsequent work in the field.

How does your recent contribution on development banks relate to your previous work on international organizations and democratization?

In studies coauthored with Alexander Libman, we identified a new phenomenon that we termed non-democratic regional organizations (NDROs), also referred to as authoritarian regionalism. We argued that authoritarian regionalism is a relatively recent phenomenon that emerged following the dissolution of the Soviet Union in the 1990s. Our research showed that this development occurred alongside the adoption and imitation of institutional features associated with the EU and democratic governance. These findings were not particularly counterintuitive. Just as regional organizations led by democracies are likely to promote and diffuse democratic norms and practices among their members, organizations led by autocracies can be expected to facilitate the spread of non-democratic values, institutions, and governance practices. Yet the point had not been made empirically. This research on NDROs has inspired me to examine the role of regional development banks in shaping political regime transitions within their respective regions.

The recent study, coauthored with Vinícius G. Rodrigues Vieira and Christopher A. Hartwell, forms part of a larger research project that Vinícius and I initiated at the Princeton Institute for International and Regional Studies with support from the Fung Global Fellows Program at Princeton University. We examine how different regional development banks led by democracies influence political developments in borrowing member states. Using three widely employed measures of democracy over the period 1972–2008, we find that membership in the International Bank for Reconstruction and Development (IBRD) and the European Bank for Reconstruction and Development (EBRD) is associated with stronger democratic development. By contrast, the effects of membership in and borrowing from the Inter-American Development Bank (IADB), the African Development Bank (AfDB), and the Asian Development Bank (ADB) are more mixed, suggesting that the relationship between regional development banking and democracy diffusion is more complex than often assumed.

Your piece argues that different regional organizations have different effects. Do those arise from the regional context or the membership of the organizations in question?

Regional context and historical legacies are highly important, but other factors can also facilitate or hinder democracy promotion. First, historical legacies help explain some of the variation in the impact of multilateral regional development banks on democracy diffusion. My primary area of expertise is post-communist Europe and Eurasia, particularly the legacies of communism that continue to shape their sociopolitical development. Research on Eastern Europe and Eurasia has demonstrated that these historical legacies influence public opinion and trust of international institutions, levels of corruption, and democracy, among other factors. In short, regional historical legacies shape the broader environment within which democratization unfolds by influencing attitudes, institutions, and patterns of behavior.

A second factor, however, is the nature of the RIOs themselves. Even regional organizations led by democracies, including the regional development banks in our study, differ considerably from one another. They were established at different historical moments and were designed to pursue distinct priorities and objectives. In some cases, lending from regional banks was not explicitly tied to promoting democratization in a borrowing state.

By contrast, the EBRD was created during the democratic transitions of the 1990s and was given a more explicit mandate to support market reforms, sustainable development, and democratization in post-communist states. These institutional differences and political regimes of the leading states of the EBRD may help explain why some organizations appear to have stronger diffusion of liberal values and sustainability than others.

This line of research has increasingly moved beyond the study of political regimes alone to explore the implications of regional organizations for issues such as sustainable development. I distinguish between democratic environmental regionalism, associated with democracy-based regional organizations (e.g., the EU and the EBRD), and autocratic environmental regionalism, associated with NDROs (e.g., the Eurasian Development Bank and the Eurasian Economic Union). My recent research has focused explicitly on the role of the EBRD and the EU in promoting and diffusing the values and principles of sustainable development. The findings provide evidence that these values have, to some extent, been transferred to actors such as the Asian Infrastructure Investment Bank (AIIB), the Eurasian Development Bank (EDB), and the Eurasian Economic Union (EAEU). However, an important question remains: do references to sustainable development in the founding legal documents and official communications of the AIIB, EDB, and EAEU represent genuine commitments, or are they primarily rhetorical? More specifically, are these principles implemented in practice, or do they merely reflect processes of imitation and institutional mimicry? This work represents an important step toward building a dialogue between the relatively new literature on authoritarian regionalism and broader debates on sustainability.

What are the factors operating here?

Our study only hints at several potential causal mechanisms and factors for this diffusion of sustainable development principles, and a more detailed investigation remains part of our future research agenda. Nevertheless, it is possible to speculate about some of the mechanisms and conditions that may help explain our findings.

The first factor relates to the role of geography, for example, proximity to large, economically powerful consolidated democracies or autocracies. The literature on diffusion has long emphasized the importance of geographic proximity in the spread of political regimes, norms, and practices. Political influence, policy learning, and institutional emulation are often more likely among neighboring states, although the direction of diffusion may vary depending on the regional context. Geographic proximity is not a causal mechanism in itself; rather, it serves as a facilitating condition that strengthens other mechanisms of diffusion and influence.

A second set of explanations concerns historical legacies, as discussed earlier. Historical legacies are likewise not mechanisms per se but broad contextual factors that encompass a range of causal processes. One particularly intriguing concept in this regard is the “limiting factor.” Among the various drivers of autocratization, this perspective may help explain the relationship between loans provided by regional multilateral development banks and the persistence or consolidation of non-democratic regimes in certain cases.

Borrowed from biology and adapted for political science, the theory of the limiting factor suggests that non-democratic regimes may endure when their survival depends heavily on a single critical source of economic support or development. If a non-democratic or transitional government retains effective control over external loans and those resources are essential to the polity’s economic stability and survival, external financing may inadvertently reinforce existing political structures rather than encourage political liberalization. In other words, resources provided by democratic sponsors can, under certain conditions, be used by incumbent elites to strengthen and consolidate the existing regime. This outcome may be particularly likely when external assistance is not accompanied by robust monitoring, auditing procedures, or effective “carrot-and-stick” mechanisms that make future funding conditional upon progress in democratization.

Finally, some regions of the world are characterized by the close coexistence of consolidated democracies and a wide range of non-democratic regimes. For example, some of my recent research has focused on the Arctic, a region that brings together states with sharply contrasting political systems, where consolidated democracies share borders and interact with non-democratic states. Such cases highlight the importance of regional context and the consequences of political diversity within a single geographic space.

Such diversity of political regimes within close geographic proximity can be viewed from at least two perspectives. First, the well-documented mechanisms of the diffusion of liberal values tend to operate most effectively in contexts of geographical proximity. Second, consolidated democracies often participate in the same RIOs as non-democratic states, as is the case in the Arctic Council. Consequently, interaction and dialogue among member states may facilitate the diffusion of both environmental and democratic values within these regional organizations. This proximity and coexistence of different polities sharing a self-defined region also encourage us to reconsider broader questions concerning sustainable development, the role of civil society, and the significance of cross-border interactions in shaping political and social outcomes.

Your findings raise significant policy questions about how advanced democracies should engage with authoritarian regional organizations. Do you have thoughts on that question?

This is an important question, although it is easier to address from the perspective of the broader research project rather than this individual article alone. The present publication is one of several collaborative studies examining the consequences of multilateral regional development banks.

Our first study on this topic, coauthored with Vinícius G. Rodrigues Vieira, published in 2020, also produced somewhat counterintuitive results. In that article, we examined the relationship between lending by democracy-led multilateral regional development banks and the voting behavior of borrowing states in the United Nations General Assembly. We found that borrowing from most regional development banks was associated with lower levels of voting alignment with the United States, particularly among more influential borrowing states.

The present study extends this research agenda by examining political regime development as the dependent variable, drawing on the same underlying dataset. As discussed earlier, our findings suggest that the effects of institutions led by democracies are not uniform. Rather, the relationships between RDB membership, lending, and democratic development vary considerably across institutions.

From a policy perspective, our findings suggest that greater attention should be paid to the institutional design and operational practices of individual banks rather than assuming that all democracy-led RDBs produce similar outcomes. In this regard, the EBRD stands out as a particularly important case. Compared with the other banks in our study, the EBRD appears to have been more successful in fostering democratic development, largely because democratization formed an explicit part of its institutional mandate.

For advanced democracies, the key policy lesson may therefore be the importance of adopting a more nuanced approach to democracy promotion. Rather than focusing solely on the provision of financial resources, policymakers should consider mechanisms that tie support more closely to governance outcomes, institutional reforms, and democratic accountability. To the extent that regional conditions permit, some of the strategies and practices associated with the EBRD may offer a useful model for promoting and diffusing democratic norms in other regional contexts.

Anastassia Obydenkova is a research scientist at the Institute for Economic Analysis of the Spanish National Research Council (IAE-CSIC) and affiliated professor at the Barcelona School of Economics. She received her PhD from the European University Institute in Florence and has held teaching and research appointments at a number of institutions in Europe and the United States. Stephan Haggard is a distinguished research professor at the UC San Diego School of Global Policy and Strategy and IGCC research director for democracy and global governance.

Thumbnail credit: EBRD (Flickr)