Integrating Integration Theory: Neo-functionalism And .

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Global Society, Vol. 10, No. 3, 1996225Integrating Integration Theory:Neo-functionalism and International RegimesTHOMAS GEHRINGIt is common to juxtapose inter-governmentalism and neo-functionalism as thetwo most important, and seemingly mutually exclusive, frameworks to interpretthe phenomenon of "European integration" and its institutional dimension, theEuropean Community. 1Inter-governmentalism promises to offer a broadly applicable concept for theanalysis of international cooperative institutions. 2 It recognises that the Community emerged from the self-help based international system and emphasisesthe continuing central role of the member states. However, conceiving of theCommunity as one international institution among many others it tends todisregard the specificities of this particular institution. Moreover, inter-governmentalism is conceptionally founded on a state-centred and static approach toinstitutions and cannot, therefore, cope with integration as a process of development over time, nor does it readily accommodate the role of non-state actorswithin the Community system.1. A single European Community did not formally exist prior to the Maastricht Accord, while thesame treaty established the "European Union" in which three original Communities are now e m b e d d e d .To ayoid confusion, the present article uses the term "European C o m m u n i t y " for the comprehensiveinstitution both in its pre-Maastricht and post-Maastricht (i.e. Union) stage.2. Stanley Hoffmann, "Obstinate or Obsolete? The Fate of the Nation-State and the Case of WesternEurope", Daedalus, Vol. 95, No. 3 (1966), pp. 862-915; Stanley Hoffmann, "Reflections on theNation-State in Western Europe Today", journal of Common Market Studies, Vol. 21, No. 1 (1982), pp.21-37; Robert O. Keohane and Stanley Hoffmann, "Institutional Change in Europe in the 1980s", inRobert O. Keohane and Stanley Hoffmann (eds.), The European Community: Decisionmaking andInstitutional Change (Boulder: Westvievv, 1991), pp. 1-39; Andrew Moravcsik, "Negotiating the SingleEuropean Act: National Interests and Conventional Statecraft in the European Community",International Organization, Vol. 45, No. 1 (1991), p p . 651-688; Andrew Moravscik, "Preferences andPower in the European Community: A Liberal Inter-governmentalist Approach", journal of CommonMarket Studies, Vol. 31, No. 4 (1993), p p . 473-524.1360-0826/96/030225-29 e University of Kent at Canterbury

226T. GehringA body of literature that is more or less related to the ideas of neo-functionalism avoids these mistakes.3 It is interested in the process of increasing integration rather than in the interaction of actors in a fairly stable environment. Itemphasises the dynamics of integration and identifies the role of supranational,transnational and sub-national actors in this process. Not least, it is capable oftaking account of the particularities of the European Community. However,beyond description of the Community system neo-functionalism has difficultiesin accommodating the role of the member states within the integration process.Even more problematic, the now exclusive focus on the European Communityjeopardises theory building because serious theory cannot be built upon andtested against one and the same empirical case.4Hence, analysts frequently conclude that neither of the two perspectives isclearly superior to the other and that both of them contribute to explainingempirically observed outcomes.5 Under these conditions theoretical anarchy andeclecticism proliferate.A closer look at the existing divide reveals that it is made up of twointerrelated aspects. At the theoretical level a static and state-centred theory isjuxtaposed with a dynamic theory emphasising the role of supra-national andnon-state actors. And at the empirical level a broad perspective on a wide rangeof similar institutions is confronted with a view on a phenomenon sui generisthat is perceived as not really being comparable to anything else. Against thisbackdrop, two questions may be posed: If it is accepted that the EuropeanCommunity is an empirically unique phenomenon, does it really need its owntheory? And vice versa: if it is true that modern neo-functionalism focuses onphenomena other than traditional inter-governmentalism, is the European Community the only empirical subject that may be examined in this way?The present paper answers both questions in the negative. It suggests that acloser focus on the impact of institutions for governance offers opportunities fora fruitful integration of the main approaches to European integration. From aninstitutional perspective the European Community may be interpreted both asan institution that has been established by the member states within thehorizontally organised international system to facilitate and stabilise cooperation, and as a polity within which intra-institutional decision processes take3. Wayne Sandholtz, "Choosing Union: Monetary Politics and Maastricht", International Organization, Vol. 47, No. 1 (1993), pp. 1-39; Anne-Marie Burley and Walter Mattli, "Europe Before the Court:A Political Theory of Legal Integration", International Organization, Vol. 47, No. 1 (1993), pp. 41-76; GaryMarks, "Structural Policy in the European Community", in Alberta M. Sbragia (ed.), Euro-Politics:Institutions and Policymaking in the "New" European Community (Washington DC: Brookings, 1992), pp.191-224; Jeppe Tranholm-Mikkelsen, "Neo-functionalism: Obstinate or Obsolete? A Reappraisal in theLight of the New Dynamics of the EC", Millennium, Vol. 20, No. 1 (1991), pp. 1-22. On the originalneo-functionalism, see Ernst B. Haas, The Uniting of Europe (Stanford CA: Stanford University Press,1958); Joseph S. Nye, "Comparing Common Markets: A Revisited Neo-Functionalist Model", in LeonN. Lindberg and Stuart A. Scheingold (eds.), Regional Integration: Theory and Research (Cambridge MA:Harvard University Press, 1971), pp. 192-231; Philippe C. Schmitter, "A Revised Theory of RegionalIntegration", in ibid., pp. 232-264.4. James A. Caporaso and John T.S. Keeler, "The European Community and Regional IntegrationTheory", in Carolyn Rhodes and Sonia Mazey (eds.), The State of the European Union, Vol. 3 (Boulder:Lynne Riener, 1995), p. 36.5. Alberta M. Sbragia, "Introduction", in Alberta M. Sbragia, op. cit., pp. 1-2; David R. Cameron, "The1992 Initiatives: Causes and Consequences", in Sbragia, op. cit., pp. 25-30.

Integrating Integration Theory227place that allow the participation of non-state actors and, to some degree, evenhierarchical governance.The paper looks first into the common roots of neo-functionalism and regimetheory and locates them in the middle ground between realism and legalism.Subsequently, it develops a concept of institutionalised international governancethat introduces an institutional perspective into the dominant approach tointernational regimes and applies it to the European Community. Finally, itopens the static concept for feedback effects and development over time.The paper concludes that the analysis of institutionalised international governance within the horizontally structured international system may in fact develop an international relations perspective that focuses on horizontalcoordination among states without simply disregarding the institutional particularities of the Community. Rather, this perspective helps draw attention to thedifferences between regular dynamic international regimes and the Community.It is apt to explain w h y (some) hierarchical governance is possible even withoutserious accumulation of power at the top of the hierarchy.From Neo-Functionalism to International Regimes: The Common Roots ofTheories of Institutionalised CooperationUnlike modern domestic systems (or at least the conceptional model derived ontheir basis) the international system is horizontally, not hierarchically ordered. Itlacks a powerful entity above its component units (i.e. states) that would be ableto establish and enforce collectively oriented norms. However, while the"anarchy" of the international system relates to this lack of hierarchy, it does notnecessarily imply absence of order. 6 Rather, the evaluation of the consequencesof international anarchy constitutes a central concern of international relationstheory.Between Legalism and RealismLegalism and classical institutionalism start from the assumption that international anarchy (or its adverse affects) may be overcome by the establishmentof international organisations and the development of international law. 7 Withinthe context of European integration it is reflected in the belief that the adoptionof a European constitution would itself constitute the key step for transformingthe European Community into a true federal state. 8 Approaches of this typeattribute a considerable amount of independent influence to international institutions even without a powerful sanctioning apparatus to enforce collectivelyoriented norms and policies. They assume that an appropriately designedinstitution is capable of steering the decisions of the units and, consequently, oftaming their otherwise self-interested and occasionally conflict-raising behaviour. Hence, the establishment of international institutions itself may be con-6. Helen Milner, "The Assumption of Anarchy in International Relations Theory: a Critique", Reviewof International Studies, Vol. 17, No. 1, pp. 67-85.7. For example, Grenville Clark and Louis B. Sohn, World Peace through World Law (Cambridge MA:Harvard University Press, 3rd edn, 1966).8. Carl J. Friedrich, Europa—Nation im Werden? (Bonn: Europa Union, 1972).

228T. Gehringceived of as an important step for the progressive development of internationalrelations.In contrast, political realism argues that the existence of international anarchywill almost automatically lead to a self-help system in which the survival of theunits (i.e. states) depends first and foremost on their own behaviour.9 Stableinstitutions are believed to constitute merely an epiphenomenon of the alreadyexisting constellation of power and interests that is not capable of exertingindependent influence. Therefore, realism warns against following the idealisticrecommendations of legalism and institutionalism. States are advised to accumulate power resources and enhance their position within the system vis-a-vis theircounterparts as far as possible. In this view it is far less important whethercooperation produces mutual gains than how these gains are distributed.10 Afterall, a powerful entity does not exist above the state-level to protect the weakerunits from adverse action by the stronger ones. Any trust in the ordering powerof international institutions is completely misconceived and may even aggravateconflict if it generates unrealistic expectations.These two approaches constitute the extremes on a continuum. While one ofthem believes in the relevance of institutions and recommends their establishment, the other denies their power and warns against relying on them. Themiddle ground between these extremes is occupied by theories which are lessoptimistic than legalism and traditional institutionalism but also less pessimisticthan political realism. Generally, they are based on the assumption that situations frequently allow mutually beneficial collaboration even of self-interestedactors, rather than being zero-sum. Moreover, they emphasise the beneficial roleof institutions even in the absence of serious sanctioning power for the establishment, maintenance and development of international collaboration, while takingaccount of the limits of their influence.Beyond the Nation-state: Functionalism and Early Neo-functionalismThere can be no doubt that functionalism11 and its later refinement, i.e. earlyneo-functionalism,12 set out to occupy this middle ground. They rejected boththe power-orientation of realism13 and the "grand designs" of legalism andtraditional institutionalism. Instead, they advocated a strategy of institutionallysupported incrementalism. They drew attention to the distinction betweenpower issues ("high politics") and welfare issues ("low politics") and arguedthat the latter, in contrast to the former, bore the potential for the collectivepursuit of common interests. Over time, progress in "low politics" would9. Edward H. Carr, The Twenty Years Crisis, 1919-1939: An Introduction to the Study of InternationalRelations (London: Harper, 1939); Hans J. Morgenthau, Politics Among Nations: The Struggle for Power andPeace (New York: Knopf, 5th edn, 1973); Kenneth Waltz, Theory of International Polities (Reading:Addison-Wesley, 1979).10. Waltz, op. at., p. 105.11. David Mitrany, A Working Peace System (Chicago: Quadrangle, 1966).12. Haas, The Uniting of Europe, op. ät.; Leon Lindberg, The Political Dynamics of European EconomicIntegration (Stanford: Stanford University Press, 1963); Leon Lindberg and Stuart A. Scheingold, Europe'sWould-Be Polity. Patterns of Change in the European Community (Englewood Cliffs: Prentice-Hall, 1970).13. Ernst B. Haas, Beyond the Nation-State: Functionalism and International Organization (Stanford CA:Stanford University Press, 1964).

Integrating Integration Theory229produce fundamental political consequences. If peace could be built on its basis,it would be a "working peace system", "not a peace that would bring the nationsquietly apart, but a peace that would bring them actively together".14In the highly technocratic functionalist perspective of world politics the properadministration of things was expected to produce more appropriate results thanpolitical governance. Organisations should be established and invested withcompetencies to execute the common interest. Therefore, institutions should beshaped according to the functions which they were actually intended to performfor (and that is, in the interest of) the actors concerned, i.e. "form should followfunction".15 Under these conditions institutions were indispensable instrumentsto instigate and support the process of integration and could operate without aconcentration of sanctioning power.Functionalist and neo-functionalist theories focus on the progressive development of integration and therefore emphasise the role of "spill over" effects. Theyemphasise the relevance of early institutionalisation of limited cooperation andexpect its later expansion. From an institutional perspective, "spill over"amounts to a (positive) feedback mechanism stressing the possibility of self-supporting social processes that start modestly, gain dynamics and may over timeproduce dramatic outcomes.16 (Neo-) functionalism also draws attention to therelevance of sub-national actors for this process, be they citizens or interestgroups. For Haas, political integration was immediately linked to the emergenceof "a new political community superimposed over the pre-existing ones"17 andbased on the anticipated shift of the loyalty of elites from the national to thesupranational setting. Accordingly, the establishment of appropriate institutionsand the transfer of the necessary competencies would decrease the role of theparticipating nation-states at least in relative terms, because other actors wereexpected to partially take over control both at the supranational and at thesub-national level.However, it should be recalled that Haas developed his argument in directresponse to the European Coal and Steel Community (ECSC), an institution ofa particularly functionalist shape governing a limited sector of regional relationsaccording to criteria quite clearly outlined in the Paris Treaty. Against thisempirical background he put forward an ideal-type process which shouldeventually lead to federation.Collective Decision-making and IntegrationA few years later Lindberg drew a significantly different conclusion from hisstudy of European integration. "My own investigations have led me to adopt amore cautious conception of political integration, one limited to the development of devices and processes for arriving at collective decisions by means otherthan autonomous action by national governments".1** It seemed to him that "it islogically and empirically possible that collective decision-making procedures14. Mitrany, op. cit., p. 51.15. Ibid.16. Later scholars of regional integration discovered also negative ("spill back") and indifferent("spill around") feedback effects; see Schmitter, op. cit.17. Haas, The Uniting of Europe, op. at., p. 16.18. Lindberg, The Political Dynamics of European Economic Integration, op. cit., p. 5 (emphasis added).

230T. Gehringinvolving a significant amount of political integration can be achieved withoutmoving toward a "political community" as defined by Haas".19It is worth noting that Lindberg did not induce this modification of theconcept of integration from the dramatic events caused by French foreign policylater in the 1960s. Rather, he derived it from his empirical examination of theEuropean Economic Community, the one original Community founded ongeneral, instead of sector-specific, integration. Apparently, this type of integration caused different governing mechanisms, presumably because it requireda constant stream of political, and not merely administrative, decisions. It wasprecisely this Community which unfolded by far the most rapid and dynamicdevelopment during the past three decades. Accordingly, the integration mechanism of the Economic Community that was based on collective decision-making could be expected both to dominate the future integration process and tomove into the centre of academic interest.Lindberg's modification disentangled political integration from the fate of theparticipating nation-states and opened neo-functionalism for a more intergovernmental perspective. While it did not rule out that political integrationmight lead to the emergence of a "new political community", it emphasised thepossibility that it could remain in a state dominated by collective decision-making (supplemented with some delegation of power). It already envisaged aCommunity that was primarily characterised by coordination among the member states.20 It was thus not very far from the later conception of a "confederal"system in which actors at the supranational (i.e. Community organs), national(i.e. governments of the member states), and transnational level (i.e. interestgroups) operated side by side.21 In a system of this type, which might be stableover time without necessarily becoming a true federal state in the mediumterm,22 many problems of coordination and implementation among states arosein a similar manner as they did in other settings of international relations.23When regional integration as a specific field of academic observation andtheorising lost its relevance during the early part of the 1970s and was eventually declared obsolete24 because the hope for the rapid emergence of a Haasian"political community" had vanished upon the actual events, two developmentshad blurred the theoretical distinction vis-ä-vis the study of international relations. Lindberg's turn in perspective and the confederal approach suggested that19. Ibid., p. 5.20. Not surprisingly, Lindberg employed later on a system-theoretical approach to integrate bothdimensions. See Leon Lindberg, "The European Community as a Political System: Notes toward theConstruction of a Model", Journal of Common Market Studies, Vol. 5, No. 4 (1967), pp. 344-387.21. On confederalism, see Donald J. Puchala, "Of Blind Men, Elephants and InternationalIntegration", lourmil of Common Market Studies, Vol. 10, No. 3 (1972), pp. 267-284, and Paul Taylor, "ThePolitics of the European Communities: The Confederal Phase", World Polities Vol 27 No 3(1975) np336-360.22. William Wallace, "Less than a Federation, More than a Regime: The Community as a PoliticalSystem", in Helen Wallace, William Wallace and Carole Webb (eds.), Policy-Making in tiie EuropeanCommunity (Chichester: Wilev, 1983), pp. 403-436.23. Donald J. Puchala, "Domestic Politics and Regional Harmonisation in the European Communities", World Politics, Vol. 27, No. 4 (1975), pp. 496-520; Donald J. Puchala, Fiscal Harmonisation in theEuropean Communities: National Politics and International Cooperation (London: Pinter, 1984).24. Ernst B. Haas, The Obsolescence of Regional Integration Theory (Berkeley CA: Berkeley University,Institute of International Studies, 1975).

Integrating Integration Theory231the development of integration within the European Community might be morestate-centred and therefore conceptionally less unique than assumed. And (neo-)functional ideas had gained so much relevance within international relationstheory at large that Haas expressly called for the inclusion of regional integrationinto, and its subordination to, the study of changing patterns of interdependence.25Interdependence and Issue Area-specific CooperationCentral neo-functional ideas were especially blossoming in the study of international interdependence.26 Like neo-functionalism, this area of internationalrelations theorising was clearly directed against the traditional narrow powerorientation of realism. It paid attention to the relevance of functional cooperationin world politics and the participation of non-state actors therein. It emphasisedthe role of lower level communication among functional bureaucracies27 and theimportance of "organisation" and multilateral negotiations as independent explanatory factors beyond power.28 Keohane and Nye developed "complex interdependence" as an ideal type of relationship within the international systemdiametrically opposed to the realist type.29The interest in "international regimes" as a new area of study was rooted inthis neo-functionally informed branch of international relations theorising.30When Ruggie proclaimed that "international relations were institutionalised",31it had become clear for some years that the horizontal structure of the international system did not preclude the emergence of institutions that matteredbecause they were capable of influencing the behaviour of actors, and accordingly the outcomes of situations. However, the concept of international regimeswas far from clearly outlined. Originally regimes were not more than somehowstabilised patterns of interdependence.32 Only much later they became expresslyunderstood as outcomes of negotiations, that is as arrangements that weredeliberately established by the actors concerned to foster their own interests.33 Incontrast to realists, regime theorists assumed that states have separate interestsin different issue-areas and not a stable hierarchy of interests with security at itstop. Opportunities for cooperation would then depend on the particular condi25. Ibid., p. 88.26. Robert O. Keohane and Joseph S. Nye (eds.), Transnational Relations and World Politics (CambridgeCA: Harvard University Press, 1972).27. Robert O. Keohane and Joseph S. Nye, "Transgovernmental Relations and InternationalOrganizations", World Politics, Vol. 27, No. 1 (1974), pp. 39-62.28. Ernst B. Haas, "Is there a Hole in the Whole? Knowledge, Technology, Interdependence, and theConstruction of International Regimes", International Organization, Vol. 29, No. 3 (1975), pp. 827-875.29. Robert O. Keohane and Joseph S. Nye, Power and Interdependence: World Politics in Transition(Boston/Toronto: Little Brown, 1977).30. See, for example, Ernst B. Haas, "On Systems and International Regimes", World Politics, Vol. 27,No. 2 (1975), pp. 147-174; Keohane and Nye, Power and Interdependence, op. cit.31. John G. Ruggie, "International Responses to Technology: Concepts and Trends", InternationalOrganization, Vol. 29, No. 4 (1975), pp. 557-583.32. Keohane and Nye, Power and Interdependence, op. cit.33. See Robert O. Keohane and Joseph S. Nye, "Power and Interdependence Revisited", InternationalOrganization, Vol. 41, No. 4 (1987), pp. 725-753; Robert O. Keohane, "The Analysis of InternationalRegimes: Towards a European-American Research Programme", in Volker Rittberger (ed.), RegimeTheory and International Relations (Oxford: Clarendon, 1993), pp. 23-45.

232T. Gehringturns prevailing within a given issue-area. Accordingly, international regimeswere necessarily issue-area specific and their shape was largely determined bythe structure of the respective issue-area (hence, again "form followed function").However, while it was clear that technological, economic, and later environmental cooperation would almost throughout affect the interests of sub-nationalactors, the regime concept did not pay particular attention to interest groups andother sub-national actors. Moreover, the assumed issue-area specificity of international regimes made it difficult to accommodate another central concern offunctionalism, namely the "spill over" concept. While the possibility of dynamically expanding substantive cooperation within the international system wasnot denied, it was expected normally to take place in the form of the emergenceof new regimes within separate issue-areas. Conceptionally, dynamics wasbeyond a theoretical approach that took specific arrangements as its units ofanalysis.These modifications hardly reduced the importance of the new approachbecause it was precisely the highly overestimated relevance of spill over in thecase of the European Community and the lacking emergence of a Haasian "newpolitical community" that had led to the revocation of neo-functionalism. Inessence early regime theory primarily dropped the unsuccessful elements of theoriginal neo-functionalism. Hence, the regime concept of the late 1970s did notonly attract some important neo-functionalist scholars,34 it may be considered asthe true successor of neo-functionalism. The central message of regime theorytoward neo-functionalism was that states might (in their own interest) play apositive role in organising international relations, rather than merely being theopponents and victims of political integration. Implicitly, international relationstheory offered international regimes as the suitable units of comparison for theEuropean Community.Regime theorists claimed that institutions could matter and change behavioureven under conditions of international anarchy. When Waltz35 developed structural neo-realism and submitted a theoretically clarified version of the realistargument based on a clear epistemology, some institutionalists accepted theWaltzian methodology and reacted in defence of the institutionalist argument.36The "cooperation under anarchy" approach produced a lot of theoretical and, onthat basis, empirical insights about the opportunities and limits of cooperation inthe horizontally structured international system.37 Eventually it decided the long"neo-realist—neo-institutionalist debate" of belief about the power of institutions in its favour.3834. This is especially true for Haas and Nye while other scholars of regional integration, for exampleSchmitter and I.indberg, retained the interest g r o u p orientation and directed their attention toward thestudy ot neo-corporatism in domestic political systems.35. Walt/, of. cit.3h. Duncan Snidal, ' T h e Limits of Hegemonic Stability Theory", International Organization, Vol. 34,No. 4 (1985), pp. 579-614; Robert O. Keohane, After Hegemony: Cooperation and Discord in the WorldPolitical Economy (Princeton: Princeton University 1'ress, 1984). Keohane, ibid., p. 67, expressivendeavoured to avoid the "smuggling in" of idealistic assumptions.37. Kenneth Oye, "Explaining Cooperation under Anarchy", World Politics, Vol. 38, No. 1 (1985), pp.1-24; Robert Axelrod and Robert O. Keohane, "Achieving Cooperation under Anarchy" World Politic*Vol. 38, No. 1 (1985), pp. 226-254.38. Robert Powell, "Anarchy in International Relations: The Neo-realist—Neo-liberalInternational Organization, Vol. 48, No. 2 (1994), pp. 313-344.Debate"

Integrating Integration Theory233In contrast to Waltzian neo-realism, the mainstream approach to regimes isstill an institutional concept that is firmly located in the middle ground betweenrealism and legalism. It emphasises the positive role of institutionalised cooperation in the international system and draws attention to the opportunities formutually beneficial cooperation depending on the constellation of interestsamong the participating actors within the issue-area concerned. However, itsstrict individualist methodology generates a practically state-centred and largelystatic concept of governance that precludes the exploration of feedback mechanisms and the dynamics inherent in institutions.Although dominating the study of international regimes, the rationalisticmainstream does not monopolise it.39 A heterogeneous "reflective" (or better,"constructive") branch that has not yet been synthesised into a coherent rivalapproach to international regimes, emphasises a number of other aspects, forexample the autonomous influence of institutions beyond cooperation amongstates, the relevance of norms and law and the possibility of (positive) feedback.40 Reflective contributions are in one way or another closer to the interdependence-oriented origins of the regime concept of the 1970s than the dominantmainstream. They centre around the argument that an existing institution may(as an independent variable) affect not merely the behaviour, but also theinterests of the member states. Hence, international regimes as empiricallyobservable phenomena might be more than cooperative arrangements amongrationally behaving state actors. And as a field of study international regimesmust not be confused with a particular theoretical perspective. In short, thedomination of the rational choice-based perspective toward internationalregimes does not invalidate the suitability of these institutions as units ofcomparison for the European Community.The Nexo Wave of European Community StudiesSince the latter part of the 1980s the theoretically informed study of Europeanintegration attracted consi

Integrating Integration Theory: Neo-functionalism and International Regimes THOMAS GEHRING It is common to juxtapose inter-governmentalism and neo-functionalism as the two most important, and seemingly mutually exclusive, frameworks to interpret the phenomenon of "European integration"

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