The political economist Mancur Olson, in his 1984 book, "The Rise and Decline of Nations," first offered institutional sclerosis as a partial explanation for the divergent growth rates experienced between the winners (with relatively low post-war growth rates) and losers (with relatively high post-war growth rates) of World War II. In liberal democracies experiencing continuity and stability, interest groups form over time and grow to exact rents, becoming vested. The accumulation of vested interests and rent-seekers ultimately slows the ability of a government to reform, adapt, and secure perfectly competitive markets thanks to a related phenomenon studied by Olson: the collective action problem. This sclerosis saps an economy's dynamism and lowers growth rates. In liberal democracies with young institutions, by contrast, competition remains perfect and natural economic dynamism and creative destruction ensue, generating high growth.
Institutional sclerosis is the phenomenon which institutions is effective in changing in some areas but unable to adjust to changes in other areas. Institutions can evolve efficiently in areas of expanding original goals to meet changing environment or including more members. At the same time, however, institutions or organizations face difficulties adjusting itself to new structures or internal policies.
2. Application to Multilateral Organizations
(a) UN Security Council
The number of permanent members or P5 constituting France, the Republic of China, the United Kingdom, the United States, and the USSR (now Russia) to the UN Security Council has not yet remedied despite the increase in the UN membership to 193 states. The UNSC has gone through only one revision in terms of the number of non-permanent member states since its establishment in 1945; initially starting as 6 non-permanent members to gradually expanded as 10 of them. Such rigidity of the UNSC to reflect changing international environment and being stuck in the original structure makes the UNSC suffer from the institutional sclerosis.
Despite intensified interdependence among ASEAN member states as well as three additional guest countries - China, Japan, and South Korea - the organization still emphasizes its non-intervention principle, retaining nation's sovereignty over regional integration.
(c) Asia Regional Forum (ARF)
- Mancur Olson. "The Rise and Decline of Nations" (New Haven: Yale University Press, 1984).
- Tow, William (2009). Security Politics in the Asia-Pacific: A Regional-Global Nexus?. Cambridge: Cambridge University Press. pp. 49–66.