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We investigate whether and how economic integration increases state capacity. This important relationship has not been studied in detail so far. We put together a conceptual framework that highlights what we call the Montesquieu, Weber and Smith channels to guide our analysis. Each of these corresponds to a series of mechanisms in three distinct institutional arenas: judiciary, bureaucracy and competition policy. To test our framework, we introduce a new panel of institutional reform measures that allow us to investigate how changes in these three arenas interact with each other and what sequence of changes yields increases in state capacity. The yearly data set covers all the 17 candidate countries to join the European Union (EU) after the 1995 enlargement. Deep integration, we find, can induce broad institutional change by providing incentives for simultaneous change in core state institutions. Bureaucratic independence and judicial capacity seem to be the key engine of the process engendered by the prospect of EU membership. Yet early and abrupt removal of external anchors might generate significant backsliding, or reversals, in domestic institutional change.

Published online 10 October 2018 ; We investigate whether and how economic integration increases state capacity. This important relationship has not been studied in detail so far. We put together a conceptual framework that highlights what we call the Montesquieu, Weber and Smith channels to guide our analysis. Each of these corresponds to a series of mechanisms in three distinct institutional arenas: judiciary, bureaucracy and competition policy. To test our framework, we introduce a new panel of institutional reform measures that allow us to investigate how changes in these three arenas interact with each other and what sequence of changes yields increases in state capacity. The yearly data set covers all the 17 candidate countries to join the European Union (EU) after the 1995 enlargement. Deep integration, we find, can induce broad institutional change by providing incentives for simultaneous change in core state institutions. Bureaucratic independence and judicial capacity seem to be the key engine of the process engendered by the prospect of EU membership. Yet early and abrupt removal of external anchors might generate significant backsliding, or reversals, in domestic institutional change. ; EU's Seventh Framework Programme for Research, Technological Development and DemonstrationEuropean Union (EU)

AbstractWe investigate whether and how economic integration increases state capacity. This important relationship has not been studied in detail so far. We put together a conceptual framework that highlights what we call the Montesquieu, Weber and Smith channels to guide our analysis. Each of these corresponds to a series of mechanisms in three distinct institutional arenas: judiciary, bureaucracy and competition policy. To test our framework, we introduce a new panel of institutional reform measures that allow us to investigate how changes in these three arenas interact with each other and what sequence of changes yields increases in state capacity. The yearly data set covers all the 17 candidate countries to join the European Union (EU) after the 1995 enlargement. Deep integration, we find, can induce broad institutional change by providing incentives for simultaneous change in core state institutions. Bureaucratic independence and judicial capacity seem to be the key engine of the process engendered by the prospect of EU membership. Yet early and abrupt removal of external anchors might generate significant backsliding, or reversals, in domestic institutional change.

We investigate whether and how economic integration increases state capacity. This important relationship has not been studied in detail so far. We put together a conceptual framework to guide our analysis that highlights what we call the Montesquieu, Weber and Smith channels. Each of these correspond to a series of mechanisms in three distinct institutional arenas: judiciary, bureaucracy, and competition policy. To test our framework, we introduce a new panel of institutional reform measures which allow us to investigate how changes in these three arenas interact with each other and what sequence of changes yields increase in state capacity. The yearly data set covers all the 17 countries that became candidates to join the European Union (EU) after the 1995 enlargement. Our main finding is that the relationship between bureaucratic independence and judiciary capacity seems to be the key engine of the process of state capacity building engendered by the prospect of EU membership. Deep integration, we find, can induce broad institutional change by providing incentives for simultaneous change in core state institutions. Yet early and abrupt removal of external anchors might generate significant backsliding, or reversals, in domestic institutional change.

We study whether and how economic integration increases state capacity. Despite the recent surge in economist's interest in state capacity, there remains a lack of theory-based detailed empirical measures. This paper introduces a new panel of institutional reform measures. We present a political economy framework highlighting the Montesquieu, Weber and Smith channels and yielding hypotheses about the judiciary, bureaucracy, and competition policy. Our main finding is that the relationship between bureaucratic independence and judiciary capacity seems to be the main engine of the process of state capacity building engendered by the prospect of European Union membership.

This study examines the effectiveness of the EU's efforts to improve labour standards among its neighbouring countries through its market integration-based regulatory governance approach. We consider the European Neighbourhood Policy as a critical case for assessing the prospects and limitations of the EU's broader agenda to promote non-trade related policy objectives through its trade policy. Using a combination of regression and comparative analysis (in Moldova and Morocco), we show that upgrading in conditionality, assistance and dialogue can contribute to improvements in labour standards, albeit with significant shortcomings. In the absence of greater EU commitment towards strengthening domestic institutions, engaging labour organizations and adopting a problemsolving approach, EU-led improvements on the books will not result in changes on the ground. Even formal changes will be restricted to areas that are compatible with other major EU policy objectives, such as market integration, political and human rights. In this context, improvements at the implementation level have been facilitated to some extent by supplementary initiatives by labour organizations, albeit within the constraints of weak state capacity. ; "The project leading to this paper received funding from the European Union's Horizon 2020 research and innovation program under grant agreement No 770680 (RESPECT)"

This paper analyses the role of domestic factors in the ability of the EU to promote NTPOs through formal trade policies and market integration, as two distinct governance approaches. Focusing on labour standards, we examine how economic and political factors in developing economies influence the ability of key stakeholders – governments, businesses and labour organizations – to undermine or reinforce EU governance efforts. We use a combination of regression and comparative case analysis to assess associations and understand processes on ground. The quantitative analysis shows that improvements in labour standards are closely associated with 1) labour standards in key export markets, 2) technological sophistication of exports, 3) state capacity and 4) freedom of CSOs. Comparative analysis of how differences in state strategies and capacity, key export destinations and strength of labour organizations across Moldova and Morocco set in place divergent pathways of labour standard improvements allows us to shed more light on the potentials and limitations of EU governance efforts. ; This project was supported by European Union Horizon 2020 research and innovation grant 770680