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Made to Measure? Europeanization, ‘goodness of fit’ and adaptation pressures in EU competition policy and regional aid

Mendez, Carlos and Wishlade, Fiona and Yuill, Douglas (2007) Made to Measure? Europeanization, ‘goodness of fit’ and adaptation pressures in EU competition policy and regional aid. [Report]

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Abstract

Increasing attention has been devoted to understanding the process and outcomes of Europeanization, but the measurement of its impact and of the adaptational pressuresinvolved remains elusive. Conventional constructs of Europeanization view 'goodness of fit' as a key indicator of the level of adaptational pressure. However, the number and variety of factors to consider casts doubt on the usefulness of this concept as a predictor of outcomes, as opposed to an ex post explanatory variable. The measurement of Europeanization and adaptational pressures can be facilitated by three elements: adopting an EU-wide perspective to enable a comparative assessment of impactsand outcomes; using a clear example of a new European level policy initiative that impacts on all Member States simultaneously; and a detailed knowledge of the ex ante and ex post situation in each Member State. The case study analysed here incorporates all these elements.In 1998 the European Commission introduced regional State aid guidelines that were explicitly modelled on the German approach to regional aid. From 2000 these rules were tobe imposed on all the Member States, almost all of which had radically different regional aid traditions. Over the period 1998-2000, this resulted in fundamental policy reviews in most countries and intense negotiations between Member States and DG Competition. Counter-intuitively, perhaps, given the apparently very limited adaptation required, the most difficult negotiations concerned German regional aid, with the dispute culminating in Germany challenging the Commission before the European Court of Justice. Against this background, this article provides a cross-country analysis and evaluation of adaptational pressures under the 1998 regional aid guidelines. It contributes to the Europeanization literature by exploring the means by which policy change can be measured and by investigating whether the predictive capacity of 'goodness of fit' can be improved.