In the paper, he focuses mostly on the participation of developing countries in the International Government Organisation, but he also gives some interesting definitions on some key words which often appear in global governance discussions.

Global economic governance and types of actors

Global economic governance is the set of norms and institutions along which rules are generated to manage the global economy.

He focuses on four types of actors in Global Economic Governance

• intergovernmental organizations (IGOs)
• states
• non-governmental organizations (NGOs)
• businesses.

Secession, Veto and Opt-Out

The secession right is the right for a state to quit the organization and hence free itself from any obligations and rights.

The opt out right is the right not to implement decisions of an IGO while remaining member of it.

The veto right is the formal right for individual states to veto an organization’s decisions.

Confederations and federations

Weak confederations are IGOs in which member-states have an opt out right but no veto rights. States may not be forced to follow a global rule but they may not prevent others from adopting it for themselves.

Strong confederations have a veto-right but no opt-out right. States may prevent a rule from being adopted, but once adopted, they must all follow it. Strong confederations have therefore the advantage of discipline but the disadvantage of inflexibility, and are best suited for relatively small groups of states with a common sense of purpose.

Federations are IGOs in which states have neither opt out nor veto rights, and hence are forced to follow rules that they do not approve whenever they find themselves in minority.

Statutes, culture, reality

Jabocs also makes the interesting distinction between statutes, cultures and reality. His remarks on the influence of the G7 and other international organisation in the field of standard setting are very interesting:

Global economic policy involves numerous “codes and standards” emanating from the Bretton Woods institutions, the G7, the OECD, the BIS, the FSF, and some UN agencies, as well as from international professional associations (i.e., global business).

Many of these organizations, particularly in the financial area, are selective clubs of Northern states that function with a strong culture of consensus. The global regulations they develop are all subject to opt out rights, and indeed they are often not even enshrined in treaties.

But there is a strong peer pressure among Northern states to actually comply with them, supported by pressure from global business but also from domestic business since, as mentioned earlier, economic isolation from global norms can hurt domestic enterprises.

These organizations can therefore arguably be described as strong confederations.

States that are not members of these exclusive clubs are also expected to embrace the regulations they generate, but they benefit from a real opt out capacity. Many of them exercise that capacity, but others adopt codes and standards to comply with IMF conditionality or because of pressures from credit rating agencies or other private financial actors.