Governance, Multilevel Governance and Europeanization

1
Governance, Multilevel Governance and
Europeanization
European Social Policy Course4 May 2009 J. R.
Grote
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Governance

• Where does it come from?
• What does it mean?
• How has been conceptualized?
• What are the nain types?
• Which are the scientific disciplines devoted to
  its study?
• Is there something like an overall definition
  that would be shared by everybody?
• What are its pre-requisites and what its
  obstacles?
• What is it expected to achieve?

3

Worldwide governance indicators

• The most widely diffused notion of the
  governance term is probably the various
  governance indices produced by international
  organizations to measure the performance and
  development capacity of countries in the first,
  the second and the third world. The aim is, in
  most cases, to arrive at something being called
  good governance.
• Most of these studies make use of compound
  indices whose number, in principle, is unlimited.
  For example
• Gross Domestic Product
• Levels of Poverty
• Levels of Education
• Government effectiveness
• Rule of law
• Political stability and so forth
• Whether this really adds up to reflect
  governance and governance capity is questionable.
  Yet, at least, it provides for interesting
  comparative information that has not been
  available in previous periods
•  

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Control of corruption 2007
Political stability 2007
Voice and accountability 2007
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Government effectiveness 2007
Rule of law 2007
Regulatory quality 2007
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Governance design or emergence?

• Governance is a method/mechanism for dealing with
  a broad range of problems or conflicts in which
  actors regularly arrive at mutually satisfactory
  and binding decisions by negotiating with each
  other and cooperating in the implementation of
  these decisions.
• Governance as institutional cybernetics or
  governance as an emergent phenomenon that
  develops behind the backs of the people.
  Governance as a quasi-natural response to
  increasing problems of coping with complexity in
  politics, in technology, in social life, etc.
  Governance as a self-equlibrating process.

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John Stuart Mill, 1862. Considerations on
Representative Government. New York Harper
Brothers.

• Central question To what extent are forms of
  government a matter of choice?
• All speculations concerning forms of government
  bear the impress, more or less exclusive, of two
  conflicting theories respecting political
  institutions or, to speak more properly,
  conflicting conceptions of what political
  institutions are. By some minds, government is
  conceived as strictly a practical art, giving
  rise to no questions but those of means and an
  end. Forms of government are assimilated to any
  other expedients for the attainment of human
  objects. They are regarded as wholly an affair of
  invention and contrivance. Being made by man, it
  is assumed that man has the choice either to make
  them or not, and how or on what pattern they
  shall be made. () To find the best form of
  government, to persuade others that it is the
  best and, having done so, to stir them up to
  insist on having it, is the order of ideas in the
  minds of those who adopt this view of political
  philosophy. They look upon a constitution in the
  same light (difference of scale being allowed
  for) as they would upon a steam plow or a
  threshing machine.

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• To these stand opposed another kind of political
  reasoners, who are so far from assimilating a
  form of government to a machine that they regard
  it as a sort of spontaneous product, and the
  science of government as a branch (so to speak)
  of natural history. According to them, forms of
  government are not a matter of choice. We must
  take them, in the main, as we find them.
  Governments can not be constructed by
  premeditated design. They are not made, but
  grow. Our business with them, as with the other
  facts of the universe, is to acquaint ourselves
  with their natural properties, and adapt
  ourselves to them. The fundamental political
  institutions of a people are considered by this
  school as a sort of organic growth from the
  nature of life of that people a product of their
  habits, instincts, and unconscious wants and
  desires, scarcely at all of their deliberate
  purposes. Their will has had no part in the
  matter but that of meeting the necessities of the
  moment by the contrivances of the moment (). It
  is difficult to decide which of these doctrines
  would be the most absurd, if we suppose either of
  them held as an exclusive theory. But, though
  each side greatly exaggerates its own theory, out
  of opposition to the other, and no one holds
  without modification to either, the two doctrines
  correspond to a deep-seated difference between
  two modes of thought and though it is evident
  that neither of these is entirely in the right,
  yet it being equally evident that neither is
  wholly in the wrong, we must endeavour to get
  down to what is at the root of each, and avail
  ourselves of the amount of truth which exists in
  either.

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• Governance in the economy and in industrial
  sectors

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The variety of mechanisms for the governance of
sectorsby P.C. Schmitter

• Up to now, scholars have emphasized the
  importance of simple dichotomies
• Charles Lindblom Market and State
• Oliver Williamson Hierarchy and Market
• Hybrid forms may exist according to these
  authors, but they are regarded as intrinsically
  unstable
• Schmitter argues that there are many of such
  hybrids and that they may be more stable than
  suggested by the standard literature
• Alliances
• Networks

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• Figure 1 distinguishes between
• a vertical axis two generic types of exchange)
  and a
• horizontal axis three means of enforcing
  whatever mechanism comes about)
• The figure generates six partially overlapping
  boxes
• Markets spontaneously equilibrating (unvisible
  hand),
• Hierarchies based on enforcement mechanisms
  (guarantee of property rights) which can be
  internalized within a company,
• Communities self-equilibrating (normative
  consensus among their members),
• States (or public hierarchies) external units of
  enforcement par excellence and have a sovreign
  status
• Alliances
• Networks.

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Fig. 1 The governance of economic sectors

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• Governance in politics and society

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• However, the problem can also be addressed from
  the more encompassing perspective of Overall
  Modes of Societal Order in modern societies and
  nation states.
• Several of such modes have been said to exist
  and are frequently addressed by different social
  science disciplines
• - The Market
• - The State
• - The Society
• While state and market are generally accepted as
  ordering mechanisms by virtually all scholars, it
  happens that some use the notion of Civil Society
  (rather than just society) while others insert
  Networks into the menu of orders. Others again
  have suggested that the market and the state are
  complemented by the Community as a third and the
  Association as a forth mode of societal order.
• Independently from what is ultimately prefered,
  the most important thing is that, to speak of
  governance, these orders need to overlap to some
  extent thus partly complementing and partly
  contradicting each other.

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Is Governance able of solving the problems
resulting from the incompatibility or
complementarity of different types of orders?
(from Streeck/Schmitters essay on PIGs)

• Modern societies, polities and economies can
  only be analyzed in terms of a specific mix of
  these institutions and principles. Each of them
  can in principle undermine but also strengthen
  the existence of adjacent institutions and
  principles.
• Communities can undermine markets (informal
  collusion, clientelist arrangments) but can also
  encourage mutual confidence and good faith
  necessary for stable economic exchange.
• Markets can decompose community bonds and erode
  common values but can also provide for
  opportunities for extended reproduction.

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• State intervention can distort markets but can
  also provide for a legal framework that guides
  and makes economic exchange viable.
• Free contracts and competition may contradict
  state policies but even the most etatist state
  requires markets as a supplementary mechanism of
  allocation.
• State growth and government intervention may lead
  to a disintegration of communities but, at the
  same time, communities without a state would
  always be in danger of losing their identity and
  independence.
• Communitarian tribalism can frustrate the
  development of a stable nation state while, at
  the same time, a state without some degree of
  spontaneous solidarity among its citizens is no
  more than a bureacratic or military conspiracy.

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While until this point, hardly anybody would have
a problem with the description of virtues and
vices of these three modes of societal order,
Streeck and Schmiiter are convinced that there is
a forth mode which has so far been largely
neglected

• Streeck and Schmitter introduce an additional
  and distinct institution (including these
  institutions guiding principles) which they call
  Association.
• Association is more than a transient amalgam
  of the three other orders and is capable of
  making a lasting and autonomous contribution to
  rendering the behaviour of social actors
  reciprocally adjustive and predictable. The
  guiding principle of interaction and allocation
  of this mode of societal governance is
  organizational concertation.
• But let us have a look at the other principles
  as well

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Three or four modes of societal order
Communities, Markets, States and Associations?
Communities Markets States Associative order (PIG)
Coordination Spontaneous solidarity Dispersed competition Hierarchical control Intra/ inter-organizational Concertation
Main actors Families Firms/ parties Bureaucratic agencies Associations, movements
Entry conditions Ascriptive member status Abiltiy to pay, eligibility to vote Legal authorization Capacity to disrupt and compromise
Exchange medium Esteem Money/ votes Coercion Mutual recognition
Exchange product Compacts Contracts/ political positions Regulation Pacts
Resources Trust, respect Pol. and econ. entrepreneurship Legitimate control Guaranteed access
Motives of actors Esteem of followers Profit/ electoral victory Careers, bureaucratic stability Organizational development
Cleavages Natives vs. foreigners Sellers vs. buyers, parties vs. voters Rulers vs. ruled Members vs. leaders vs. state interlocutors
Pay-offs Mutual affection, collective identity Material prosperity, citizen accountability (External) security Social peace
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• Both in practice (empirical manifestations of
  it) and in theory (analytical reflection on it),
  governance needs to be/ can be
• - approached from (at least) three
  analytical angles in a simultaneous fashion.
• - understood in terms of an emergent
  phenomenon that tends to develop
  everywhere within a given political system and
  tends to achieve equilibrium points which
  reflect highly specific situations in
  political, societal and in economic terms
• - understood in terms of deliberate design.
  i.e. as a program or strategy elaborated by
  political practitioners and political analysts

20
The number of potential hybrids and of their
concrete overlap areas is in principle unlimited
S
M
A
C
Communitarian markets, New Public Management,
social economy, associative democracy,
public-private partnerships, etc.
21
Scientific order and disorder
In a situation where everything overlaps and
depends on each other, the established
disciplines dealing with these systems might run
into problems. It is today hardly imaginable that
any single of these disciplines will be able to
dealing with the complexity characterizing any
single of their analytical targets. Hence the
need for inter-disciplinary research!
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Governance as network
23
There is of course also a network component
involved in discussions of governance. Imagine
the people represented below were political
institutions, organizations and different
organizational layers that are formally divided
by specific tasks and duties (e.g. the president,
ministerial offices, and public and private
organizations attached to these offices).
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Rectangular matrix of advise relations (14 x 14)
director
head of division
book-keeper
secretaries
To whom do you turn with questions relevant to
your work? orTo whom do you turn for
information of strategic importance?
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Simple network graph
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Status analysis
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Status indices
secretaryhead of divisiondirectorhead of
division head of division secretarysecretarybook
keeperbook keeper book keeper book keeper book
keeper book keeper book keeper book
keeper secretary
head of division
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Governanceby Anne Mette Kjaer

• On paradigm shifts and the meanings of
  governance
• GOV in Public Administration/ Public Policy
• GOV in International Relations
• European GOV (and MLG)
• GOV in Comparative Politics and economic
  development
• GOV in Processes of Democratization and
  Transition
• GOV and the World Bank

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I. Paradigm shift in public policies

• From hierarchy, sub-ordination and top-down
  control
• towards
• Policy networks
• network management, self-organizing networks
• Meta-governance
• Managing the rules (of formulation,
  decision-making and implementation) and
  coordinating them across policy domains
• Coordinating the plurality of hierarchies,
  markets and networks across domains

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II. Paradigm shift in international relations

• From the neo-realist assumption of states as the
  most important actors in world politics
• versus
• a growing importance of multinational actors and
  transnational networks
• a growing importance of international regimes

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III. Paradigm shift in European integration
studies

• From a focus on European integration and
  institutions (as the explanandum)
• towards
• a focus on EU policy-making,
• its effects on domestic policies and
• on the management of complex inter-relationships
  in policy-making across all levels (subnational,
  domestic, supranational)

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IV. Paradigm shift in political economy

• From the neo-liberal position (the state should
  have no role at all and leave development to the
  market)
• towards
• a heterarchic conception of governance as the
  management of self-organizing networks that
  involve a plurality of organizational forms such
  as the state, the market or networks

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V. Paradigm shift in democratization/ transition
research

• From modernization and early transition theories
  (determinism and presumption of the existence
  of only one single path-way of development
  towards democracy)
• towards
• institutional governance approaches
• that allow for a more open-ended vision
• and argue that institutions circumscribe
  political agency in as much as agents themselves
  are capable of altering institutions

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VI. Paradigm shift in the international economy

• From a selective policy followed by the World
  Bank (granting help to those that already have
  good governance)
• towards
• a critique of the WBs dependency on its largest
  shareholder (the US)
• a focus on accountability versus a global public

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Governance and political design
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Attributive requisites of governance
arrangements (from PC Schmitter, 2002)

• a. List of potential pro-governance policies
  supported and implemented by public authorities
• b. List of necessary attributes on the part of
  (organized) civil society
• c. List of principles for the chartering,
  composition and decision-rules of governance
  arrangements

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I. Pro-governance policies

• 1. freedom of association, petition and assembly
• 2. legal recognition
• 3. special fiscal treatment
• 4. arenas for functional representation
• 5. guarantees of access to decision-making
• 6. protection from non-intromission in internal
  affairs
• 7. subsidization with public funds
• 8. obligatory membership and/ or member
  contributions
• 9. legal extension of contracts
• 10. devolved responsibility for policy
  implementation

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II. Attributes of (organized) civil society

• 1. class, sectoral, professional or corporate
  consciousness
• 2. voluntarism
• 3. moral sentiments
• 4. sociability
• 5. trust
• 6. altruism or other-regardingness
• 7. universalism
• 8. sense of personal efficacy
• 9. organizational skills

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III. Principles for the chartering, the
composition and the decision-rules of Governance
Arrangements
a) Chartering

• 1. mandated authority (clearly circumscribed
  mandate by the EU establishing its composition
  and rules)
• 2. sunset principle (not for an indefinite
  period pre-established date of expiry with
  possibility of renewal)
• 3. functional separability (no overlap in tasks
  with existing EU institutions)
• 4. non-supplementarity (no displacement of
  existing EU institutions)
• 5. request variety (EGA can narrow or widen the
  range of participants and modify internal rules
  as long as it does not violate the general
  charter)
• 6. anti-spill-over (no EGA should exceed the
  tasks for whose solution it has originally been
  designed)

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b) Composition

• 1. rights (membership in a national political
  community)
• 2. spatial location (all those living on a
  regular basis within a demarcated territory)
• 3. knowledge (person or organization possessing
  indispensible knowledge for solution of problem)
• 4. share (holders of property rights in those
  assets being affected by EGA)
• 5. stake (all those that could materially or
  spiritually be affected by operation of EGA)
• 6. interest (anybody representing a constituency
  who demonstrates sufficient awareness about the
  issue at stake)
• 7. status (each organization having an official
  status in the representation of social, economic
  or political categories)

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Composition continued (different types of
holders)

• primary citizens
• 1. rights holders citizens/voters
• secondary citizens
• 2. space holders residents
• 3. knowledge holders experts
• 4. share holders owners
• 5. stake holders beneficiaries AND victims
• 6. interest holders spokespersons
• 7. status holders representatives

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c) Decision rules

• 1. putative equality (irrespective of size,
  each participant should be considered as equal
  no first, second, third class participants)
• 2. horizontal interaction (avoidance of hierarchy
  such as stable delegation of tasks, formalized
  leadership, etc.)
• 3. consensus principle (no majority voting, no
  imposition but deliberation, persuasion and
  regular interaction)
• 4. open-door (possibility of exit-option without
  subsequent retaliation)
• 5. proportionality (outcomes are roughly
  proportional to the specific assets of each
  participant)
• 6. shifting alliances (avoidance of rigid
  cleavages permanent re-composition of groups and
  actors)
• 7. checks and balances (no decision on matters
  concerning outside organizations)
• 8. reversibility (no decisions that cannot be
  annulled by right holders, i.e. citizen/ voters

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Multilevel Governance (MLG)

• 1. MLG visualized
• 2. MLG and jurisdictions

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A simple circuit of functional political exchange
State authorities Representatives of labor
unions Representatives of business associations
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A simple circuit of territorial political exchange
Government at level A
Government at level A
Government at level A
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A more complex representation of Multilevel
Governance and of the positioning of different
actor categories
government
NGOs
International suprantional
associations
National
Sub-national(regional, local)
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Unraveling the Central State, but How? Types of
Multi-Level Governanceby Liesbet Hooghe and Gary
Marks

• Type I Governance
• The intellectual foundation for Type I
  governance is federalism, which is concerned with
  power sharing among a limited number of
  governments operating at just a few levels.
  Federalism is concerned chiefly with the
  relationship between central government and a
  tier of non-intersecting sub-national
  governments. The unit of analysis is the
  individual government, rather than the individual
  policy. In the words of Wallace Oates (1999,
  1121), dean of fiscal federalism, "The
  traditional theory of fiscal federalism lays out
  a "general normative framework for the assignment
  of functions to different levels of government
  and the appropriate fiscal instruments for
  carrying out these functions." The framework is
  system-wide, the functions are bundled, and the
  levels of government are multiple but limited in
  number.

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• Type II Governance
• An alternative form of multi-level governance is
  one in which the number of jurisdictions is
  potentially vast rather than limited, in which
  jurisdictions are not aligned on just a few
  levels but operate at numerous territorial
  scales, in which jurisdictions are task-specific
  rather than general-purpose, and where
  jurisdictions are intended to be flexible rather
  than durable. This conception is predominant
  among neoclassical political economists and
  public choice theorists, but it also summarizes
  the ideas of several scholars of federalism,
  local government, international relations, and
  Europeanstudies.

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• Type I governance constrains the number of
  jurisdictions according to the following design
  principles
• Nonintersecting memberships. Jurisdictional
  memberships at the same territorial level do not
  overlap. Nonintersecting membership limits the
  need for jurisdictional coordination horizontally
  at any level and, vertically, across levels.
• Cascading jurisdictional scale. The territorial
  scale of jurisdiction decreases sharply across
  levels. European Union countries have between two
  and five subnational levels, described by the
  European Commission in terms of a common rubric,
  the Nomenclature des unitis territoriales
  statistiques (NUTS) (Eurostat 1999, 27). The
  median population represented in the first level,
  NUTS 1 jurisdictions, is 3.89 million that in
  the second level, NUTS 2 jurisdictions, is 1.42
  million NUTS 3 jurisdictions have a median
  population of 369,000 the median population in
  NUTS 4 is 48,000 and at the lowest level, NUTS
  5, it is 5,100. In the United States, the
  corresponding median population is 3.76 million
  for states, 69,600 for counties, and 8,800 for
  subcounties. A cascading jurisdictional scale
  spreads governance across vastly different scales
  but limits the total number of sub-national
  levels to three, four, or, at most, five tiers.

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• General-purpose jurisdictions. A logical
  corollary is that authoritative competencies are
  bundled into a small number of extensive packages
  at each level. Type I governance disperses
  authority across widely different levels and
  constrains the number of levels by making the
  jurisdictions at each level multipurpose.
• Systemwide architecture. The pyramidal structure
  of Type I governance lends itself to hierarchical
  direction. Most Type I governance systems are
  bound together by a single court system with
  ultimate authority to adjudicate among contending
  jurisdictions.

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• Type II governance is alternative to Type I.
• It limits coordination costs by constraining
  interaction across jurisdictions. Type II
  governance sets no ceiling on the number of
  jurisdictions but spawns new ones along
  functionally differentiated lines. As a result,
  externalities across jurisdictions are minimized.
  This is an exact corollary to Herbert Simon's
  (1996,178) notion of "nearly decomposable
  structures. Simon argues that tasks within an
  organization should be distributed so that the
  share of internal interactions within constituent
  units is maximized and the share of external
  interactions minimized. The idea, applied to
  jurisdictional design, is to distribute tasks so
  that the short-run behavior of actors across
  different jurisdictions is more or less
  independent from that of others, while their
  long-run behavior is connected only in the
  aggregate.' How can decomposability be attained
  in policy provision? How, in other words, can one
  break up policymaking into discrete pieces with
  minimal external spillover?

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• The following design principles characterize
  Type II governance.
• Functional specificity. Specific, functionally
  distinct competencies are hived off and
  insulated. In this way, externalities-and
  therefore interdependence-among jurisdictions are
  minimized. The assumption that all significant
  costs and benefits are internalized within the
  jurisdiction is a foundation of Type I1
  governance theory, including Tiebout's (1956)
  theory of jurisdictional competition, Buchanan's
  (1965) theory of clubs, and Oates analysis of
  metropolitan competition (Oates and Schwab 1988).
• Flexible, policy-specific, architecture. Type I1
  governance is designed with respect to particular
  policy problems-not particular communities or
  constituencies. Institutional design-the scope of
  a jurisdiction, its mode of decision making,
  adjudication, and implementation-can thus be
  adapted to particular policy problems.

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• The two types of governance share one vital
  feature They are both radical departures from
  the centralized state. However, they diffuse
  authority in contrasting ways.
• Type I governance bundles competencies in
  jurisdictions at a limited number of territorial
  levels. These jurisdictions form part of a
  system-wide plan They are mutually exclusive at
  each territorial level, and the units at each
  level are perfectly nested within those at the
  next higher level. Jurisdictional design
  generally corresponds to communal identities
  Each jurisdiction caters to an encompassing group
  or territorial community. These jurisdictions are
  oriented to voice rather than to exit. Type I
  governance reflects a simple design principle
  Maximize the fit between the scale of a
  jurisdiction and the optimal scale of public good
  provision while minimizing inter-jurisdictional
  coordination by (a) creating inclusive
  jurisdictions that internalize most relevant
  externalities and (b) limiting the number of
  jurisdictional levels.

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• Type II governance also limits the transaction
  costs of inter-jurisdictional coordination, but
  it does so in a fundamentally different way, by
  splicing public good provision into a large
  number of functionally discrete jurisdictions.
  But these jurisdictions do not conform to an
  overarching blueprint. Rather, each is designed
  to address a limited set of related problems.
  Type II jurisdictions are task-driven. Hence, the
  same individual may be part of several
  overlapping and intersecting jurisdictions.
  Membership in Type II jurisdictions tends to be
  conditional and extrinsic. Type II jurisdictions
  are often designed to have low barriers to entry
  and exit so as to engender competition among them.

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3. Europeanization

• 1.Conceptualizing and measuring it
• 2. Europeanization in comparative perspective

56
3.1 The domestic effect of Europeanization
57
3.2 Two logics of domestic change
58
3.3 Degrees of domestic change
59
Democracy in Europe. The EU and National Policy
Makingby Vivian A.Schmidt
1. Policies
60
3. Patterns of policy formulation and
implementation
Member states along a continuum from statist to
corporatist processes
61
Corporatist countries
62
Statist/ etatist countries
63
Pluralist countries
64
National patterns of policy-making and the impact
of the EU
65
Conclusions Policies
66
2. Politics
67
Representative politics of simple and compound
polities
68
Simple and compound polities along a continuum
betweenmajoritarian and proportional electoral
systems
69
Percentage of people who said they were very or
fairly satisfied with their domestic political
system
70
Percentage of people who said they trusted the
European Union
71
Percentage of people who feel their countrys
membership in the European Union is a good
thing
72
Percentage of people who see themselves as both
their nationality and European
73
Percentage of people who feel their country
benefits from EU membership
74
Conclusions Politics
75
2. Polities
76
Simple and compound polities along a continuum
betweenunitary, regionalized and federal
structures
77
Institutional structures of simple and compound
polities
78
The differential effect of the EU on national
executives powers, projection of preferences
and compliance patterns related to institutional
structure
79
Conclusions polity