Legal Framework for International Business

II. Actors

Realists view states as the primary actors in the international system. In other words, states are treated as natural actors in world politics. In fact, IR scholars often discuss sovereign states interacting in an institutional and legal void that is described as a ‘state of nature’ or ‘anarchy (meaning a lack of sovereign authority or government). Kenneth Waltz, in his influential book Theory of International Politics (1979), famously viewed states as the only relevant units for understanding the structure of world politics. Waltz and other realists argue that state behavior is best explained by the balance of power in the international system, as measured by materials factors, such as size of territory and population, and the strength of the military and economy. If one wishes to understand world politics, according to this perspective, the important factor is to understand which states have the most power in the international system. Within this context, international law is largely irrelevant. States do not respond primarily to legal rules, but rather to practical considerations determined by the amount of power they have vis-à-vis other states. Ultimately, the contours of the international system are shaped by power and the use of force, and not by international law.

Such approaches make it difficult for realist IR scholars to analyze developments in international organizations and international law in which states voluntarily comply with international law, give up aspects of their sovereignty, or share sovereignty with other actors. It also means that realists have a difficult time studying international organizations or international legal orders as anything more than the outcome of state interests. A key example here would be the emergence of the European Union as an entity in which states have pooled their authority and have delegated aspects of their sovereignty to a supranational organization. Such institutional arrangements are difficult to understand from a purely state-centric and power politics perspective. For example, the introduction of the Euro as a common currency in many EU states, and the emergence of a European common monetary policy, poses a puzzle to realists as it suggests a willingness of EU states to relinquish national autonomy and sovereignty in a key area of domestic economic policy.