Dispute settlement mechanisms and maritime boundary settlements

The literature on the institutionalization of international cooperation argues that states include dispute settlement procedures in their agreements to “tie the hands” of states. This paper reverses this thinking and shows that when a regime provides institutionalized dispute settlement, states sometimes seek to undo it. The settlement of maritime boundaries is a case in point. Governed by the Law of the Sea regime, which provides four institutional mechanisms for states to solve disputes, the vast majority of agreements specify bilateral negotiations as the only way to deal with future conflicts. The reason for this is that states pay attention to both the cost and flexibility of conflict resolutions mechanisms. We find that poorer states are more likely than wealthy states to specify bilateral negotiations, the cheapest and most flexible conflict resolution mechanism. Wealth differentials are also associated with greater demands for flexibility.