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Regional cooperation, and the role of international organizations and regional integration

  • Schiff, Maurice
  • Winters, L. Alan

The authors examine regional cooperation among neighboring countries in the area of regional public goods. These public goods include water basins (such as lakes, rivers, and underground water), infrastructure (such as roads, railways, and dams), energy, and the environment. Their analysis focuses on developing countries and the potentially beneficial role that international organizations and regional integration may play in bringing the relevant countries to a cooperative equilibrium. A major problem in reaching a cooperative solution is likely tobe the lack of trust. If neighboring countries do not trust each other because of past problems, they may fail to reach a cooperative solution as each tries to maximize its gain from the regional public good. These strategies typically do not account for spillover effects and ultimately leads to losses for all parties. Other constraints on reaching a cooperative solution are its complexity and the financial requirements. Two types of institutions may help resolve some or all of these problems. International organizations can help with trust, expertise, and financing. The United Nations and the World Bank have been involved in a number of such projects in Africa, Asia, and elsewhere, and have been successful in helping parties reach cooperative solutions. Regional integration agreements, though not necessary for regional cooperation, may also be helpful by embedding the negotiations on regional cooperation in a broader institutional framework. The authors examine these issues with the support of both analysis and a number of case studies.

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Paper provided by The World Bank in its series Policy Research Working Paper Series with number 2872.

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Date of creation: 31 Jul 2002
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Handle: RePEc:wbk:wbrwps:2872
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  1. Casella, Alessandra, 1993. "Trade as an Engine of Political Change. A Parable," CEPR Discussion Papers 779, C.E.P.R. Discussion Papers.
  2. Hearne, R.R. & Easter, K.W., 1995. "Water Allocation and Water Markets. An Analysis of Gains-from-Trade in Chile," Papers 315, World Bank - Technical Papers.
  3. Dinar, Ariel & Wolf, Aaron T., 1997. "Economic And Political Considerations In Regional Cooperation Models," Agricultural and Resource Economics Review, Northeastern Agricultural and Resource Economics Association, vol. 26(1), April.
  4. Barret, Scott & DEC, 1994. "Conflict and cooperation in managing international water resources," Policy Research Working Paper Series 1303, The World Bank.
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