Discussion Papers

No.683 Theorizing regional group formation : anatomy of regional institutions from a membership perspective

by Shintaro Hamanaka

January 2018


Drawing inspiration from the ancient Chinese proverb "寧為雞口,無為牛後" in Zhan Guo Ce [戰國策], which means that "it is better to be the head of a small group than to hold a less powerful position in a large group," this paper offers an alternative explanation to institution-building. The proposed theory is expected to shed light on institution-building not only in Asia-Pacific, but also all over the world. In theorizing institution-building, we put special emphasis on membership and leadership, which are intrinsically linked concepts. The key factor connecting the two concepts is "exclusion," because exclusion of rivals is necessary in order for a state to become a leader. We hypothesize that a potential leader attempts to form a group from which more powerful states are excluded, in order to become an actual leader. Our main claim is that the creation of a regional group is an effective way to exclude rivals and become an actual leader. We will examine the explanatory power of Regional Group Formation Theory, using 33 cases of regional institution-building projects in Asia-Pacific since WWII. Our empirical investigations revealed three of Japan's behavior patterns with regard to membership in regional groupings, strongly suggesting the validity of the proposed theory: (i) Japan does not support regional groups which include the US, because US presence limits Japan's leadership opportunity (five out of six cases of groups including the US); (ii) Japan supports regional groups excluding the US, where it can hold the leadership position (19 out of 23 cases of groups excluding the US); and (iii) Japan opposes regional groups excluding Japan, where countries like Indonesia lead (Japan tried to join all of 4 cases).

Keywords: Regional Group Formation Theory, Regionalism, Regional institution-building, Membership, Leadership, Exclusion

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