Beginning roughly in the mid-1980s, Japanese policymakers have campaigned for
greater leadership, influence, and representation in the Bretton Woods institutions. While
gradual, progress has been made. In both institutions, Japan now formally occupies the
number two position behind the United States. However, Japan’s voting shares continue
to lag behind its position in the global economy, and formal representation does not
necessarily correspond to the de facto ability to attain desired outcomes. In addition,
despite similar historical circumstances, I will argue that Japanese success has varied
considerably between the two institutions. Existing international relations theory offers
only limited leverage over such divergence in outcomes.
As this exposition will demonstrate, Japan has achieved more success in obtaining
institutional influence within the World Bank compared to the IMF. An explanation of
this divergence requires a detailed analysis of the operation of path dependence and its
manipulation by national actors. To this end, I will propose a theoretical framework that
treats international institutions as cooperative standards. Like standards such as computer
operating systems or video formats in private markets, international institutions embody
distributive tendencies that can be manipulated by interested actors. For the Bretton
Woods institutions, standard-based competition is particularly salient. The institutional
focus area of the IMF is characterized by higher network externalities and lower
transportability of benefits compared to the World Bank. Consequently, the World Bank
faces greater standard-based competition and is less likely to exhibit path dependence.
This leads to the expectation that Japanese efforts to secure influence in the World Bank
should be more successful than similar efforts in the IMF.
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Convention