Institutional Design and Formal Autonomy: Political versus Historical and Cultural Explanations
Yesilkagit, Kutsal, Christensen, Jorgen G., Journal of Public Administration Research and Theory
This article tests two competing hypotheses in the study of the institutional design of regulatory agencies. Political explanations consider the degree of institutional design of regulator' agencies as a function of political factors, such as the degree of policy conflict and political uncertainty. By contrast, historical-cultural explanations of institutional design claim that the design of regulatory agencies is a function of path dependency and national administrative traditions. In this article, we test these hypotheses on a data set of 295 regulatory agencies that were created between 1945 and 2000 in Sweden, the Netherlands, and Denmark. We find strong support for historical-cultural explanations, while our findings suggest that political factors play almost no role in the institutional design of regulatory agencies within parliamentary regimes.
Regulatory reform and the opening of markets for competition have been key topics in comparative analysis of public policy and public administration in recent years. Analyses in these fields pay considerable attention to the creation of regulatory agencies. Some scholars even claim that changes are so many and radical that they have been speaking of the "Advent of the Regulatory State" (Majone 1994). Central in this argument is policy makers' demand for organizational forms that ensure a credible commitment to their reforms of regulatory policy. Parallel to this interest in the implementation of regulatory reform, other scholars have dealt with the causes of delegation to the administration and in particular to agencies enjoying certain autonomy from the political executive. Hence, during the past two decades or so, US studies have produced a wealth of insights into the politics of delegation. The literature offers rich and multiple (partial) explanations for the degree of independence politicians delegate to regulatory bodies. Perhaps the main finding within these studies is the pivotal role that political factors play in processes of regulatory design, with variables of policy conflict and political uncertainty as the usual suspects (Epstein and O'Halloran 1999; Huber and Shipan 2002; Lewis 2003; Moe 1995).
The US-based studies on regulatory design and delegation have been replicated for European parliamentary systems (Bertelli 2006a, 2006b; Elgie and McMenamin 2005; Gilardi 2002, 2005; Jordana and Levi-Faur 2005; Van Thiel 2004). The problem with these studies is that they have produced mixed results. For example, the finding of Gilardi (2002) that the number of veto players has an effect on the degree of formal autonomy of regulatory agencies could not be corroborated by Elgie and McMenamin (2005). These findings, in turn, can neither be substantiated nor refuted by Bertelli, who measured policy conflict on the basis of political parties' attitudes toward regulation, devolution, and administrative efficiency (Bertelli 2006a). Van Thiel (2004), by contrast, found that political factors were not that significant at all; instead, she found that the creation of independent agencies is a path-dependent trend: politicians create independent agencies because their predecessors created independent agencies. Finally, Jordana and Levi-Faur (2005) and Gilardi (2005) claim that the creation of regulatory agencies in both developing and developed economies is caused by diffusion and emulation of the independent agency model.
The disparity in findings between these scholars clearly shows the following: although US scholars have made substantial inroads toward explaining and understanding the determinants of institutional design, students of European regulatory administration are still confronted with a number of contradicting observations. In this article, we will address what we believe is one of the main problems in the study of regulatory administration in European political systems. At the heart of the matter, according to us, lies the lack of a systematic analysis of two alternative explanations for the creation of regulatory agencies: political versus historical and cultural explanations. …