Studying conditionality – the external incentives model

Despite its widespread use in literature, a consensual understanding of EU conditionality is missing in academic debates. Similarly as Europeanisation, conditionality is commonly studied with the use of rational choice institutionalism and sociological institutionalism, linked respectively with the logic of consequences and appropriateness originating in the work of March and Olsen (1998) discussed in the previous section. Rational choice studies commonly follow the logic of consequences, linked to the perceived benefits of conditionality. On the other hand, authors like O’Brennan (2006) have recognised the importance of the logic of appropriateness, stressing that “normative explanations of the enlargement prove much more compelling than either geopolitical or economic- centred arguments” (p.177). In an analysis of the relative impact of membership conditionality incentives and socialisation, Kelley (2004b) concludes that “combining both socialisation-based efforts and conditionality appears not only effective, but also wise” (p.453). This research recognizes the importance of both logics and thereby emphasizes the need for simultaneous examination of literature from both strands for the study of this mechanism and its impact.

The most common analytical tools for the examination of political conditionality have revolved around the previously examined logics of consequences and appropriateness. In line with this division, Schimmelfennig and Sedelmeier (2005b) have developed three models for the examination of the effectiveness of conditionality – the external incentives model, the social learning model and the lesson drawing model. These models were applied in two alternative contexts: democratic (political as used in this thesis) and acquis conditionality. For these authors, conditionality is “a bargaining strategy of

reinforcement by reward, under which the EU provides external incentives for a target government to comply with its conditions” (Schimmelfennig and Sedelmeier, 2004 p.662). The conclusions of their research indicate that rule transfer from the EU to the CEECs and the variation in its effectiveness are best explained according to the external incentives model and are linked to the high credibility of EU conditionality and the low domestic costs of rule adoption (Schimmelfennig and Sedelmeier, 2005b). Having in mind that the credibility of conditionality in the area of minority protection is low, because of the contested nature of minority protection norms and the domestic costs are usually high, the chances for success of the external incentives are low. According to this model, the minority condition should not be effective, even though in cases like Latvia and Estonia conditionality has been praised for its success in relation to the protection of minorities, going directly against the logic of the external incentives model. In light of these bleak predictions for success, Sasse (2009) has argued that the link between low domestic adoption costs and effective conditionality undermines the very notion of conditionality (p.18).

The external incentives model has been the main explanatory tool for the study of rule adoption by the candidate countries in both the eastern enlargement of the EU as well as in the seldom studies of the Western Balkans accession (Grabbe, 2005, Trauner, 2011). At the same time, its application in non- acquis policy areas and political conditionality especially has been subject to criticisms due to its focus on the outcome, presupposed determinacy of EU rules, focus on power politics and overestimating the role of EU conditionality (See Hughes et al., 2005, Brusis, 2005b, Grabbe, 2006). First, by focusing on rule adoption as the outcome of conditionality, the external incentives model does not provide sufficient tools to examine the process of application of conditionality which is of interest to this research. As a result, the approach does not account for the changes of conditionality over time, which are of significance for the before and after approach adopted for this thesis.

Second, in the specific policy area of interest to this research, the external incentives model is not adequate due to the presumed determinacy of the EU rules. Rational institutionalist explanations of conditionality assume an existing consensus between both sides on the content of EU rules and the benchmarks for their fulfilment. On the other hand, as already explained, conditionality in relation to minority policies conditionality is highly flexible. Grabbe (2006) points to the analytical difficulties of grasping conditionality since it has become a moving

target. This has been the case foremost in the political criteria as the EU has moved down the path of using conditionality on issues of domestic politics (Pridham, 2002b). Moreover, “the EU puts different emphasis on the way it justifies its policy of conditionality to domestic actors in the various Western Balkan countries – a differentiation closely linked to the specificity of each case” (Noutcheva, 2007). As a result, the premise of the existence of a consensual understanding on the side of both the candidate country and the EU is strongly contested in academic literature, especially in relation to political conditionality. In response, Hughes and Sasse (2003) argue that “the standard measure of compliance employed in studies of EU enlargement, the degree and pace of transposition of the acquis de l’union, is not useful since EU law is virtually nonexistent, in the policy area of minority protection” (p.2).

It is nevertheless necessary to qualify that the setting of criteria in the minority area is difficult primarily due to the complex nature of these policies. Pravda (2001) explains this practical problem in setting democratisation criteria and evaluating political performance, because “political targets are typically qualitative and hard to define as precisely as economic goals” (p.13). Brusis (2005b) also concludes that the conditions “are likely to have a more tangible direct impact in issue areas where the EU has a more prescriptive acquis” (p.316). In light of these assessments, Magen and Morlino (2009) criticize the tendency of literature towards the homogenisation of external influence on domestic reform processes (p.12). Hughes et al (2005) consider that a “fundamental problem for the concept is that macro-level and policy-level studies are inconclusive about the causal effects of ‘Europeanisation’ and demonstrate the persistence of deep structural divergences across national and policy contexts” (p.28). Magen and Morlino (2009) also underline that in reality, the same factors have a varying effect on democratisation outcomes, in light of the specific outcome studied.

Moreover, it has been further argued that “if the conditionality criteria pertain to an issue area perceived as problematic for national identity, a different line of reasoning will be triggered than in cases where the criteria are considered unproblematic” (Freyburg and Richter, 2010 p.266). National minority issues are from this perspective of highest salience for the national identity. For Freyburg and Richter (2010) national identity determines the logic of social action that governments will follow when responding to the Union’s conditionality criteria (p.266). Thus, in these policy areas, the findings on the effectiveness on the external incentives model are qualified by emphasizing the context-dependent

influence of the EU as an actor (Schimmelfennig and Sedelmeier, 2005a p.223). Overall, as a result of these difficulties in framing the EU’s impact in relation to minority protection in an external incentives model, research has recommended its use predominantly in relation to prescriptive acquis policies.

Rationalist explanations of conditionality have also been under criticism due to their focus on power politics, which is not always adequate for grasping the nature of conditionality. To illustrate this point, Grabbe (2006) examines the restrictions of the free movement of people in the 2004 and 2007 accession, concluding that “the candidates did not just respond to the material incentives provided by the EU’s exercise of power” (p.202). Hence, if rational choice explains the nature and behaviour of national governments, governments in many cases do not respond to EU conditionality in terms of their most favourable choices. Grabbe (2006) goes on to argue that “for the CEE candidates, the puzzle lies in their continued implementation of EU policies despite the imposition of a transition period and despite high levels of uncertainty” (p.3). She explains this phenomenon through the locking in the process of “Europeanisation which had a momentum and logic independently of the negotiations” (Grabbe, 2006 p.3).

Lastly, the external incentives model has been under criticism because of the risk of overestimating the effects of the EU conditionality. As explained in the introduction, the simultaneity of the processes of Europeanisation and democratisation makes it increasingly difficult to account for the developments linked to each of them separately. Moreover, as the EU appeared as an actor in the CEE countries at a point when early transition choices had already been made, there is no possibility to study the effectiveness in absence of alternative setting without the EU as an actor. As a result, demonstrating causal links between the externally induced conditions and the domestic policy choice has been increasingly difficult. The external incentives model, according to Brusis (2005b) “does not allow the interference that the domestic change is driven by EU incentives because the Union applies conditionality or because domestic actors justify their decision as driven by EU conditionality” (p.297).32 As a result of these assessments, the external incentive model, although used for the study of acquis conditionality is not considered as an appropriate framework for this study, which is interested in the role of EU in shaping minority policies between 1997 and 2012. For this purpose, the next section, examines the alternative approach for the

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In light of these criticisms, this dissertation tackles specifically the role of domestic actors in the operation of conditionality.

study of EU conditionality by focusing on the process of its application and evolution over time, which is used in this thesis.