Just published – Fabio Franchino

The Excessive Deficit Oversight of the European Union Works

Since 1994, the budgetary process of European Union governments can be subject to a supranational oversight procedure if the deficit is deemed excessive.

Does it work? In brief, yes.

In this work, I show that the impact of surveillance during budget drafting offsets that of a two-year shortening of expected government duration, the addition of one party to a government coalition when debt is high, or a leftward shift in government ideology when the risk of replacement is low.

Using a technique called exact matching on treatment histories, I also show that these effects peak after four to five years.

Being under surveillance may lower the benefits of fiscal profligacy in the proximity of elections. Reforms, on the other hand, like the one occurring now, hardly make a difference.

Franchino, Fabio. 2023. ‘International Oversight of Fiscal Discipline’. European Journal of Political Research. Early View. https://doi.org/10.1111/1475-6765.12600.

Asbtract: Fiscal discipline, the sustainable balancing of government outlays with revenues, is one of the most extensively theorized and empirically investigated objects of inquiry in political economy. Yet, studies covering European Union (EU) countries have mostly ignored the oversight of national budgets via the EU excessive deficit procedure. I explain why this surveillance engenders lower deficits and investigate its effects across all EU member countries. Results indicate that the impact of surveillance during budget drafting offsets that of a two-year shortening of expected government duration, the addition of one party to a government coalition when debt is high, or a leftward shift in government ideology when the risk of replacement is low. Moreover, estimates from exact matching on treatment histories indicate that these effects peak after four to five years. These findings have important normative implications for democratic policy-making in European countries and the fledgling EU-wide fiscal policy.

Bargaining outcomes and success in EU economic governance reforms

We assess the accuracy of procedural and bargaining models in predicting the outcomes of the reforms of the economic governance of the European Union (EU) that took place between 1997 and 2013. These negotiations were characterized by high costs of failure. We confirm the accuracy and robustness of the compromise model, but a procedural model with a costly reference point performs well, indicating that misestimation of the no-agreement cost may be a reason for its commonly reported poorer accuracy. However, this model is more sensitive to measurement errors. We also show how both models contribute to understanding bargaining success and how the conditional influence of the European Parliament should not be ignored. We conclude by discussing the implications of these results for our understanding of the EU.

Franchino F and Mariotto C (2022) Bargaining outcomes and success in EU economic governance reforms. Political Science Research and Methods 10(2). 2021/07/15 ed. Cambridge University Press: 227–242. DOI: 10.1017/psrm.2021.26.

Noncompliance risk, asymmetric power and enforcement design

In the European Union, states can distribute enforcement prerogatives between a supranational agency, over which they exercise equal influence, and a Council of ministers, where power resources mostly vary by country size. What shapes attitudes towards different enforcement designs? States at greater risk of noncompliance should eschew deeper cooperation and prefer procedures over which they can exercise more influence. Employing an original data set of positions on relevant contested issues during the negotiations over fiscal governance rules from 1997 to 2012, we show that governments at greater risk of noncompliance prefer greater discretion and, if they have higher voting power, more Council involvement in enforcement. These factors only partially explain positions on Commission empowerment. Given their greater indeterminacy, attitudes are also shaped by national public opinion.

Franchino F and Mariotto C (2021) Noncompliance risk, asymmetric power and the design of enforcement of the European economic governance. European Union Politics 22(4). SAGE Publications: 591–610. DOI: 10.1177/14651165211023832.

Electoral competitiveness and responsiveness in the EU

Several studies have reported a relationship between governments’ behaviour in the EU Council and public opinion. However, doubts remain about which mechanisms drive this relationship. We argue that governments align their behaviour with public opinion to forestall future electoral sanctions (rational anticipation). To test this, we deduce hitherto untested observable implications of rational anticipation which suggest that governments’ responsiveness to public opinion depends on national-level electoral competitiveness. Using DEU modules I-III and an original empirical measure of electoral competitiveness, we ascertain whether governments adjust their responsiveness as: (1) the expected time period to upcoming elections decreases, and (2) the probability of losing their position in the party system in the next election changes. Our results provide evidence that government parties rationally anticipate risks related to their position in the party system but not to early elections. These findings have implications for our understanding of representation in the Council.

Franchino F, Kayser MA and Wratil C (2022) Electoral competitiveness and responsiveness: rational anticipation in the EU Council. Journal of European Public Policy 29(1). Routledge: 42–60. DOI: 10.1080/13501763.2021.1991986.

PRINCIPI DI SCIENZA POLITICA 2/ED

Principi di scienza politica è la migliore introduzione alla disciplina a livello internazionale. Questo testo trasforma studenti interessati al mondo politico che li circonda in osservatori analitici e sofisticati. Il volume offre una chiara e rigorosa introduzione dell’applicazione del metodo scientifico allo studio della politica e una tra le più complete e aggiornate rassegne delle ricerche più recenti.
La nuova edizione mantiene il focus sulle più importanti domande di ricerca affrontate dagli studiosi, sulle questioni intorno alle quali è iniziato a emergere un consenso, e sugli strumenti più sofisticati utilizzati dagli scienziati politici per affrontare queste complesse domande. Il volume si basa sulla terza edizione americana, ampliamente rivisitata e integrata. Fra gli aggiornamenti segnaliamo un’estesa revisione del capitolo sulle dittature con una discussione dei due problemi principali del governo autoritario; una trattazione più approfondita della teoria della modernizzazione culturale con una panoramica dei metodi più avanzati per condurre sondaggi; nuovi paragrafi sui problemi della delega nelle democrazie e sulle questioni relative all’integrità elettorale; una rassegna ampliata delle diverse forme di rappresentanza; una nuova presentazione intuitiva dell’analisi statistica.
Le sezioni relative all’Italia sono state aggiornate e integrate con argomenti quali, per esempio, come si fanno e disfano i governi; l’integrità elettorale; la politica delle riforme elettorali dall’unità a oggi; l’Italia interpretata come una repubblica dei veti.

William Roberts Clark, Matt Golder, Sona Nadenichek Golder. 2022. Principi di Scienza Politica. Milano: McGraw-Hill.
Edizione italiana curata da Fabio Franchino, Luigi Curini, Daniela Giannetti, Valerio Vignoli, Francesco Zucchini.

Politicization and EU economic governance

Does politicization – the expansion of the scope of national conflict – shape EU policy design? Are the functional pressures shaping design disrupted?

We address these questions with regard to the EU economic governance regime in this @jepp_journal article.

We reach the following conclusions:

a) This regime, based heavily on Council-centred enforcement, is clearly not in line with standard liberal-intergovernmental expectations about policy design, especially given significant noncompliance.

The first figure below illustrates how enforcement-related prerogatives are pooled within the Council, rather than delegated to the Commission, as liberal-intergovernmentalism suggests, despite the extensive noncompliance. The second figure shows the patterns of noncompliance with this regime across time and member states.

b) We argue that this design has more to do with salience and severe implementation uncertainties, related to somewhat arbitrary criteria, like the reference values, and to unobservable quantities, whose measurement depends on uncertain estimates, THAN with politicization.

For instance, the Council is unlikely to heavily rely on Commission enforcement if the measurement of the output gap is highly uncertain.

c) Yet, problems of compliance and commitment, threats of exclusion and veto, issue linkages, path dependencies, and supranational involvement remain central in explaining the overall direction of reforms toward national tightening, limitation of Council authority and delegation to the Commission, despite recent politicization

d) Note however that this was a case where mass domestic politicization was triggered BY noncompliance and elite conflict. So we should not conclude that politicization is necessarily epiphenomenal for policy design.

Thanks to the special issue editors: C. Reh, C. Koop, and E. Bressanelli.

Franchino, Fabio, and Camilla Mariotto (2020) ‘Politicisation and Economic Governance Design ‘ Journal of European Public Policy, 27:3, 460-480.

European Union can afford to be more transparent

Transparency improves the relationship between citizens and politicians, but it could lead to posturing or pandering to public opinion. Politicians may therefore fail to adopt policies and reach valuable compromises. In a recent research, Sara Hagemann and Fabio Franchino show that the drawbacks of increased transparency in the EU Council of Ministers have not materialized. The European Union can afford to be more transparent.

Recent studies suggest there is a direct trade-off between transparency and efficiency in legislative politics. We challenge this conclusion and present a bargaining model where one particular kind of transparency – the publication of legislative records – works to overcome problems of incomplete information.

We also present empirical findings from legislative activities in the Council of the European Union from 1999 to 2014 and from 23 interviews with senior officials in Brussels. Our results show that increased transparency, in the form of publication of legislative records, does not lead to gridlock or prolonged negotiations.

On the contrary, recordings of governments’ positions help facilitate decision-making as they increase credibility of policy positions. This, in turn, lowers risk of negotiation failure and screens out marginal amendments.

The article is available here

Hagemann, Sara, and Fabio Franchino. “Transparency vs Efficiency? A Study of Negotiations in the Council of the European Union.” European Union Politics, (February 8, 2016) OnlineEarly. doi:10.1177/1465116515627017.

Personal websites: Fabio Franchino, Sara Hagemann

Your prejudices about law observance are (sometimes) wrong

Italy more law observant than Denmark and Finland? Spain more compliant than Germany? You hardly hear this in the news, but these are the surprising patterns of noncompliance with the regulation on state aid in the European Union between 2000 and 2012. We report the results from a research conducted by Fabio Franchino and Marco Mainenti that explains how electoral institutions shape the incentives of governments to comply with international obligations.

Check out this figure.

It illustrates the proportion of unlawful measures out of the total number of state aid measures adopted by the countries of the European Union (EU) (measures are unlawful if they do not comply with the EU provisions on state aid). Existing explanations of compliance and implementation in the European Union cannot satisfactorily describe these patterns.

These data not only display surprising patterns across countries but the simple fact that a government decides in the first place to avoid these rules is puzzling since the likelihood of being detected is high and the costs associated with noncompliance are not trivial (an unlawful aid must be recovered, including the accrued payable interests). Notice that certain state aid measures are compatible with EU law.

To explain why countries are willing to take these risks, we use the recent literature on how compliance with international obligations is affected by the types of electoral institutions employed in a country. These institutions can shape the incentives of governments to comply because of the misalignment they may engender between the collective objectives of a government party and the individual objectives of its members in the legislature.

We find that an increase of district magnitude improves compliance (district magnitude is the number of seats available in an electoral district). The higher the magnitude the less politicians are pressured to cater to constituency-specific interests and the less likely they will press their government to circumvent the EU provisions on state aid.

However, where either party leaders have no control over the ballot rank or other electoral rules strengthen the incentives to search for a personal vote, compliance decreases with higher magnitude. These electoral rules increase competition among candidates in a multi-member district. The higher the number of candidates, the toughest the competition and the need for politicians to distinguish themselves from copartisans, the higher the pressure to evade the rules.

Our work also provides evidence for the effects of electoral reforms on compliance.

The article is available here

Franchino, Fabio, and Marco Mainenti. “The Electoral Foundations to Noncompliance: Addressing the Puzzle of Unlawful State Aid in the European Union.” Journal of Public Policy 36, no. 3 (September 2016): 407–436. doi:10.1017/S0143814X15000343.

Data download (coming soon)

Personal websites: Fabio Franchino, Marco Mainenti

How we value honest and competent politicians (so long as they share our views)

How we value competence, honesty and other valuable traits depends on how close politicians are to our ideas. If they are distant, we tend to dismiss those qualities. We may even prefer unsavory politicians if the alternative is someone supporting policies we deeply dislike. We report the results from an experiment conducted by Fabio Franchino and Francesco Zucchini with the research assistance of Alessandra Caserini of the Laboratorio Indagini Demoscopiche, Università degli Studi di Milano.

Un brigante onesto è un mio ideale. Giuseppe Garibaldi

Competence, like truth, beauty and contact lenses, is in the eye of the beholder. Laurence J. Peter

‘Honesty is the best policy’. How can we disagree with Benjamin Franklin? Right? But how do we actually value honesty and other universally cherished traits, such as competence and dedication, when we choose politicians?

In 2012–13, we have conducted experiments in which participants were asked to choose between candidates who vary along three character-based valence (education, income and honesty) and two ideological (attitudes toward taxation and spending and the rights of same-sex couples) attributes.

Our results indicate that education and integrity, but not income (unsurprisingly), indeed behave like valence issues in which voters prefer more to less. More interestingly, the degree to which a valence attribute like education, which is a proxy for competence, influences the propensity to choose a given candidate depends on the proximity between the political views of the respondent and the political views of the candidate.

In other words, we do value competent politicians, so long as they share our views. If they do not, we tend to dismiss these traits.

In awkward situations where participants have to choose between one politician with whom they share the political views, but there are issues concerning his integrity, and a second politician who is clean but supports disliked policies, they tend to prefer the (at least integrity-wise) unsavory candidate.

Honesty is the best policy, if you support the best policies.

The article is available here

Franchino, Fabio, and Francesco Zucchini (2014) ‘Voting in a Multi-Dimensional Space: A Conjoint Analysis Employing Valence and Ideology Attributes of Candidates‘, Political Science Research and Methods, 3,2: 221-241

Data download

Links to websites: Fabio Franchino, Francesco Zucchini, Alessandra Caserini , Laboratorio Indagini Demoscopiche

Conciliation Committee Negotiations

Franchino, Fabio and Camilla Mariotto (2013) ‘Explaining Negotiations in the Conciliation Committee‘, European Union Politics, 14.

Abstract

The conciliation committee is the ultimate bicameral dispute settlement mechanism of the ordinary legislative procedure of the European Union. Who gets what, and why, in this committee? We argue that its institutional setup is biased in favour of the Council of Ministers. Employing the Wordfish algorithm, we show that the joint text is more similar to the Council common position than to the parliamentary reading in almost 70 percent of the dossiers that reached conciliation up to February 2012. The European Parliament is more successful in the post-Amsterdam period, when the Council decides by qualified majority voting, the rapporteur comes from a large party, the European Commission is supportive, and when national administrations are more involved in the implementation process than the Commission.

Data download