Why should governments delegate decision–making authority over territorial issues to an international institution? This study argues that governments are motivated to reach territorial solutions to reduce the opportunity costs associated with a festering dispute. The evidence suggests that domestic political incapacity to negotiate concessions is associated with a commitment to arbitrate. Compliance is a function of the net costs and benefits involved in accepting the arbitral decision. These costs include the loss of valuable territory, but noncompliance also exacts costs with respect to governments? reputation, both domestically and internationally. This research speaks to a broader debate about the role of international legal institutions in foreign policy making and international outcomes. It shows that governments have good reasons, under certain political and economic conditions, to use international legal processes as a substitute for domestic political decision making.
Journal of Conflict Resolution 46, no. 6 (2002): 829-856.