| Review of: | States of Liberalization. Redefining the Public Sector in Integrated Europe by Mitchell P. Smith |
|---|---|
| Reviewed By: | Marc Schattenmann |
| Reviewed in: | Governance |
| Date accepted online: | 14/01/2008 |
| Published in print: | Volume 20, Issue 03, Pages 545-556 |
Book Reviews
Over the past 15 years, public services that Europeans once took for granted and regarded as the core of their state's activities have been transformed beyond recognition. Gone are the days when
In a more general form, these questions have been at the heart of the long-standing debate in comparative political economy between those who expect ever more convergence between national policies and institutions and those who insist on the possibility of diversity in the face of ever increasing interdependence and a globalizing economy. This debate has rather recently entered EU studies, too. After decades of mostly explaining why nation-states choose integration, exploring the mechanics and effects of "Europeanization" (i.e., the transformation of national institutions and policies through the process of European integration) has become one of the most productive areas in the field.
Smith's book makes an important contribution to both the more general and Europeanization debates by examining three cases where liberalization occurred to different degrees and in different ways. The first case is public procurement. There, far-reaching liberalization had been enacted by the European institutions by 1993, but little interpenetration of national markets ensued. The second case examines postal services, a sector where liberalization has been slow and incremental, especially when compared to industries such as electricity and telecommunications. Here, Europeanization has had the effect of increasing, rather than decreasing, protectionism in some member states. The third case is a one-country, one-sector study of government aid to public enterprises: Germany's system of public sector banks, the
According to his findings, the timing and scope of liberalization depends on three factors. It depends, first, on the extent of formal complaints of actual and potential competitors of protected public service providers. These complaints allow the European Commission (EC) and the European Court of Justice to police and enforce European competition rules. Accordingly, much depends on whether or not market structures and EC competition rules foster the emergence of such complaints. If complaints arise, the reactions of the public sector monopolists are crucial. Do they reform in expectation of inescapable liberalization or do they resist and fight back? Second, liberalization depends on the cost-benefit calculations of public sector monopolists and protectionist governments. These may change over time, in one direction or another, depending on whether the hope of gaining market share in other EU member states or the fear of facing foreign competition in the home market dominates the calculation. Finally, liberalization depends on shifts in actor constellations. It becomes more likely if the weight of public sector monopolists in national policy formulation can be reduced either by "participation expansion" or by the extension of the political arena to the European level.
The fact that these "it depends" answers are nuanced and permit neither easy generalizations nor predictions will be applauded by some and deplored by others. Those who look for an original and sweeping new theory of liberalization or Europeanization should look elsewhere. The same holds for those who want a formal model that reduces the political analysis of the liberalization process in Europe to a computational problem. Rather, this is a book for those who believe that the best we can do is to narrow down the possibilities of what the "it" entails in "it depends" formulations and to formulate a number of "more likely, less likely" scenarios, while recognizing that actual decisions charting the course of liberalization and Europeanization are ultimately up to the multitude of actors and their unpredictable interactions. This is a book for those who believe in the value of theoretically informed case studies and carefully documented process tracing.
Quite obviously,