International Collaboration in the North Atlantic Treaty Organization
Critically examine the proposition that small allies have exploited ' large allies in the North Atlantic Treaty Organisation. Comment on the proposition that prospective gains for producer groups prove more important than assessment of gains to nation states when explaining international collaboration?
The North Atlantic Treaty Organisation (NATO) expanded by three new members in 1999 and thus now has nineteen members. Although most people view this to be a benefit for the future of NATO as it should enhance their strength and credibility there are those who view that it will lead to further exploitation in defence budget sharing and an allocative efficiency. It is thought that due to issues such as Globalisation the world is becoming more interlinked with organisations such as NATO and the UN comprising of more and more members. It is feared that this expansion will lead to problems with free riders taking advantage of the ever-increasing availability of the public goods offered by organisations such as NATO. There is also a case that producer groups within member countries benefit more than the actual nation states as the benefits to them are much more assured and accessible. Politicians are an example of a group, which can benefit greatly from international collaboration, as it is a tool, which can help them, gain re-election.
The first real concerns over the economics of alliances were raised in Mancur Olson and Richard Zeckhauser their writings in 1966. This raises the point that in international institutions such as NATO the smaller allies are relying on the larger allies to pay the vast amount of the defence budget and thus free riding, this became known as the exploitation hypothesis. Sandler and Hartley point out a clear example of this exploitation, as in 1970 the USA contributed 75% on NATO 's defence spending with the next closest allies which included the UK, France and Germany only contributing 6%. The exploitation becomes evident when
The North Atlantic Treaty Organisation (NATO) expanded by three new members in 1999 and thus now has nineteen members. Although most people view this to be a benefit for the future of NATO as it should enhance their strength and credibility there are those who view that it will lead to further exploitation in defence budget sharing and an allocative efficiency. It is thought that due to issues such as Globalisation the world is becoming more interlinked with organisations such as NATO and the UN comprising of more and more members. It is feared that this expansion will lead to problems with free riders taking advantage of the ever-increasing availability of the public goods offered by organisations such as NATO. There is also a case that producer groups within member countries benefit more than the actual nation states as the benefits to them are much more assured and accessible. Politicians are an example of a group, which can benefit greatly from international collaboration, as it is a tool, which can help them, gain re-election.
The first real concerns over the economics of alliances were raised in Mancur Olson and Richard Zeckhauser their writings in 1966. This raises the point that in international institutions such as NATO the smaller allies are relying on the larger allies to pay the vast amount of the defence budget and thus free riding, this became known as the exploitation hypothesis. Sandler and Hartley point out a clear example of this exploitation, as in 1970 the USA contributed 75% on NATO 's defence spending with the next closest allies which included the UK, France and Germany only contributing 6%. The exploitation becomes evident when
Bibliography: Sandler and Murdoch On Sharing NATO defence burdens in the 1990 's and Beyond, Fiscal Studies, vol. 21, no.3, 2000 pg. 297-327 Olson and Zeckhauser An Economic Theory of Alliances, Review of Economics and Statistics, 1966 (vol 48, no 3, pg 266-79) Richards J E Towards a positive theory of international institutions: regulating international aviation markets, International Organisation, vol 53, 1999, pg 1-37 Sandler and Hartley The Political Economy of NATO, Cambridge University Press, 1999, Chapter 2