Toward a Positive Theory of International Institutions: Regulating International Aviation Markets

The regulation of postwar international aviation markets suggests that existing approaches to international institutions cannot adequately account for important elements of international institution building. In particular, scholars have neglected how domestic politics shapes the incentives of national governments to create and maintain international institutions and the impact of domestic politics on the scope and functions of international institutions. Drawing on positive theories of regulation and the literature on property rights, I argue that national politicians use international institutions to increase the wealth available for domestic redistribution. In short, national politicians create and maintain international institutions to maximize domestic political support. I present a domestic political model that explains how, when, and why national politicians create international institutions. The model is applied to the creation of institutions governing international aviation markets in the late 1940s and the reformulation of these institutions over the past two decades.