International regime complexity in sovereign crisis finance: a comparison of regional architectures

The theory of international regime complexity that frames this study specifies expectations for international cooperation stemming from different combinations of hierarchy and differentiation among institutions in regime complexes. This paper compares relationships between regional financial arrangements and the International Monetary Fund in the regional complexes for crisis finance in East Asia, Latin America, and the euro area during 2000-2019 and tests these expectations. Creditor states that sit at the nexus between global and regional institutions are particularly influential in the choice of architecture (the combination of hierarchy and differentiation) for these complexes but are constrained by arrangements inherited from previous decades. Once chosen, the complex’s architecture in turn shapes policy adjustment in borrowing countries and influences whether states pursue regime shifting or competitive regime creation when dissatisfied with institutions. These findings generally coincide with expectations, but exceed the degree of policy adjustment that the core theory expected for the euro area. Interinstitutional collaboration, the dynamics of which are elaborated, fills this explanatory gap. The paper concludes that relations among institutions are essential for understanding the outcomes and evolution of regime complexes and underpin a more complete explanation than provided by singular institutionalism, the power-gap hypothesis and other alternative approaches.