EU Delegation and Agency in International Trade Negotiations: A Cautionary Comparison*

Abstract

The principal-agent (PA) approach is increasingly used to explain how and why the EU formulates its trade policy and engages in international trade negotiations. This article evaluates the utility of PA in trade policy through a comparative analysis of the EU's participation in two different international negotiations: the International Competition Network and World Trade Organization (2001-06). The comparison of EU institutions and activities in these two empirical cases suggests that while PA seems well suited to explain international negotiations in regulatory policies (competition), it seems less suited to explain developments in distributive policies (trade). The findings, which reveal potential problems of multiple agents and a greater likelihood of observational equivalence in trade policy, advise caution when using PA to explain the EU's behaviour in international trade negotiations. Copyright (c) 2007 The Author(s); Journal compilation (c) 2007 Blackwell Publishing Ltd.

The role of the European Parliament in international negotiations after Lisbon

“…Given the EU's complex system of governance, most studies used principalagent models to examine the act of delegation in international negotiations (e.g., Hawkins et al 2006;Pollack 1997); they attempted to explain why member states allowed the Commission to negotiate in their name and to evaluate how much freedom the Commission enjoyed while acting as an agent (e.g., Damro 2007;Dür 2006;Elsig 2007;Kerremans 2004). Before Lisbon, most international agreements fell outside the scope of the consent procedure (introduced in the Single European Act); consequently, the Commission would generally represent the EU at the international level and the Council would be in charge of drafting the mandate, as well as signing and ratifying the agreement.…”

“…Ad locum controls previously varied depending on the legal basis of international agreements. In first-pillar matters (now extended to all negotiations under Article 218 TFEU), the EU negotiator often received new negotiating directives or had to consult a Council special committee; in some cases, member states even sat alongside the Commission at level I, which allowed for direct oversight (Collinson 1999;Damro 2007;Delreux 2008;Kerremans 2006). In third-pillar matters, negotiations were led by the Presidency, which afforded even closer control by the Council, since the EU negotiator was one of its members (Delreux 2008).…”

Process-Tracing as a Tool to Analyse Discretion

“…By doing so, we can better control for problems of observational equivalence related to the anticipatory adaptive behaviour of actors and other empirical challenges noted by principalagent scholars (Pollack 2002;Damro 2007). The reason for this is that we would be going beyond an input-output empirical analysis of correlations, investigating what actors actually do in the process.…”

“…principal-agent scholars studying the EU often focus on determining the degree of potential autonomy as a function of the size of informational asymmetries and the strength of the control functions (Pollack 1999;Franchino 2000aFranchino , 2000bTallberg 2002;Dijkstra 2014;Elsig 2007;Furness 2013). While there is a long list of potential theoretical determinants of high agency costs, the most often discussed are: the delegation of strong powers (Pollack 2003), the presence of only a limited pool of potential agents (Hawkins and Jacoby 2006), weak sanction mechanisms (Pollack 1999(Pollack , 2003Kerremans 2006;Delreux and Kerremans 2010), high informational asymmetries (Epstein and O'Halloran 1999;Dijkstra 2010) and strong preference differences between principal(s) and agent (Waterman and Meier 1998;Epstein and O'Halloran 2008;Damro 2007) or among principals (Elsig 2007(Elsig , 2010Delreux and Kerremans 2010;niemann and Huigens 2011). More recently, EU scholars have also indicated the potential effect of incomplete contracting (conceição-Heldt 2013) or, when taking into account the increasingly complex decision-making contexts such as the EU's presence in international institutions, the informality of the institutional environment (niemann and Huigens 2011) and the compellingness of the international negotiation context (Delreux 2011).…”

“…Pollack (2002) for example discusses the methodological challenge of observational equivalence, which follows from potential anticipatory adaptive behaviour by the agent (Kroll this volume). Multiple authors have in that regard already highlighted the problem of differentiating between autonomous agency behaviour and effective control by the principal (Weingast and Moran 1983;Pollack 2002;Damro 2007;Delreux 2013), yet only few have offered solid solutions. In order to overcome these difficulties, Pollack urged for a comparative case study approach that would allow the analyst to "trace the hypothesised causal mechanism at work" (Pollack 2002: 202).…”