On Europe Now

Over the next few posts I will be revisiting work completed as part of my undergraduate degree. Today I start with European integration, this essay explores whether or not any theory can fully explain the process of integration. I toyed with the idea of updating the writing style of these essays but in the end decided to retain them in their original form.

Can any theory fully explain the process of European Integration? If not, why not?

The process of European integration is a puzzling one for integration theorists. This is due to its complexity and because integration of this nature had never occurred before. The result of this is that several theories have sought to explain the integration of Europe.
Initially theories of European integration grew out of the International Relations school of thought, however as integration progressed new theories have developed to try and explain the governance of the EU. The main difference however is between those who view the EU as supranational in nature versus those who view it as more intergovernmental.

In this assessment I will focus on three main schools of thought on integration theory: first I will look at the Neofunctionalist perspective of European integration, followed by the intergovernmentalist perspective looking at Moravcsik and his theory of Liberal Intergovernmentalism (LI), then finally I will look at New Institutionalism (NI) assessing European integration through the branch of the Historical Institutionalist perspective of that school.

Neofunctionalism lies in the supranationalist camp in the intergovernmentalist versus supranational debate. Neofunctionalism has its roots in two US academics Haas and Lindberg ; the theory contends that the process of ‘spill-over’ is the “mechanism for integration” .

Spill-over occurs when integration in one area is a co-requisite of integration in an interrelated policy area . On this basis European integration can be seen as a backward process of integration with co-requisites requiring pre-requisites and these pre-requisites further becoming co-requisites for something else.

Spill-over comes in three main forms, functional, political and cultivated .
Functional spill-over is based on economics, with areas in an economy being “so interdependent that it is impossible to treat them in isolation” , as a result the pre-requisite – co-requisite situation described earlier occurs.

In explaining EU integration it can be argued that functional spill-over occurred, when the integration of coal and steel (the first integration at European level, the European Coal and Steel Community) required the integration initially of other ‘energy sectors’, which required the integration of economies as a whole , which is evident in the signing of the Treaty of Rome establishing the European Economic Community (EEC) in 1957 .

Political spill-over occurs when elites in member states increasingly focus their attention at the supranational level to solve their domestic problems , the view would then be formed that supranational solutions are better than those at national level and as a result these elites will “refocus their activities, expectations and perhaps loyalties to the new centre… lead[ing] to calls for further integration”
This spill-over is highlighted by the fact that there wasn’t just one treaty at Rome in 1957, but two, political spill-over led to the Treaty establishing the European Atomic Energy Community (EURATOM) being signed at the same time .

Cultivated spill-over is defined by the role supranational institutions take in providing “integrative initiatives” to increase the pace and areas of integration.
Such an example can be found in the publication by the Commission in 1985 of its White Paper Completing the Internal Market which called for a removal of all non-tariff barriers in the Union , as a result by the end of that year the Single European Act was agreed and signed the following year.

Neofunctionalism does not however completely explain the process of European integration.
Neofunctionalism it is argued does not differentiate between low politics that of domestic issues, and high politics that of security and foreign affairs , as such it fails to explain why the Member States opted to create an intergovernmental pillar (one of two under the EU umbrella) for ‘Common Foreign and Security Policy’.

Furthermore it fails to explain the ‘empty chair crisis’ of 1965, in which de Gaulle objecting to the majority voting methods in the Council and the supranationalist implications this gave rise to, recalled all French representatives from the decision making bodies of the EEC . The ‘Luxembourg Compromise’ which solved this crisis, created the principle of national vetoes if member states felt a proposal went against ‘vital’ national interest, and this “put a break to further extension of the scope of the Community” .

However recent evidence has shown that Neofunctionalist theory can still be used to explain the integration process. Taking the Stability and Growth Pact (SGP) as an example, Heipertz and Verdun argue that “it is factually impossible to supranationalise monetary policy and leave the fiscal regime unchanged as if exchange rates were still present and flexible”
As a result they argue that the SGP was a result of functional spill-over, as the requirements of a monetary union (the adoption of the Euro) required a supranational approach to keeping budget deficits (a fiscal issue) within agreed limits.

However the Neofunctionalist theory does not “account for the entire SGP case” , Tranholm-Mikkelsen likens European integration to an elephant with Neofunctionalist theory explaining the parts “that make the animal move”.

Much of the criticism of Neofunctionalism comes from, not surprisingly, the other side of the theoretical spectrum, under the intergovernmentalist school of thought.
Intergovernmentalism originated from international relations theory specifically the realist view, which asserts that states are the most important actors in international affairs.
Intergovernmentalism therefore seeks to explain the process of European integration by explaining it as “the converging national interests of states” .

The theory has its foundations in the academic Hoffman, however it has since been reformulated by his former student Moravcsik under the heading Liberal Intergovernmentalism (LI) .
There are three main assumptions behind LI, first is the assumption of “rational state behaviour” where states will always use the most suitable means to achieve their objectives .

This it can be argued is why states turn to the European level to solve domestic issues, as the “pro-European idealism of heads of government” faced with economic reliance on each other realise the benefits of “long-term co-operation”. They are willing to ‘pool’ their sovereignty as “efficiency and effectiveness require”. Likeness can be drawn here to the Neofunctionalist view of political spill-over.

Secondly the pluralistic views on European policy in society are combined by the government, and these forms the preferences of the government , these targets are shaped by “domestic pressures and interactions” .

In his analysis of the negotiations taking place around the Single European Act (SEA), Moravcsik explains that the British government under Thatcher “being fully aware that the City contained highly competitive banking and insurance sectors” called for liberalisation of the service sector across Europe, in an attempt to make it more competitive.

The third assumption of LI, is that the “outcome of negotiations between governments are essentially determined by their relative bargaining powers” with larger states therefore dominating the agenda.

Moravcsik explained this again using the SEA as an example, “the dominance of the three largest states is revealed most clearly by the lack of cases in which a smaller nation either initiated or vetoed a central initiative”.

European integration according to the LI view is controlled by the member states and while the supranational institutions at EU level may play a role in the process, this is merely a “means of locking one another into commitments” , as without this locking in effect there would be a lure to defect from agreements . The role these supranational institutions play is negligible in relation to the whole process, with European policy making having the Council of Ministers as its focal point.

Integration itself, the theory contends has not been a smooth spill-over transition as claimed by the Neofunctionalists but one of “fits and starts” relying on intergovernmental conferences (IGC’s) and European Council meetings of the heads of states and governments.

Perhaps the strongest argument for a LI view of European integration is the fact that member states can secede from the Union whenever they like, thus halting the process of integration in their own country.

Moravcsik’s theory of European integration came under intense criticism by academics, and it is argued does not explain fully the process of integration.

The main criticism is that LI has focused on a “series of snapshots” where major decisions on European integration took place at the European Council level, rather than on more day to day decisions.

The view that governments amalgamate domestic interests and preferences and take them to the bargaining table is flawed, as it appears to lack an understanding of the “closed nature of IGC policy-making” . The issues to be discussed being very vague and the specifics often unknown until the conference begins.

Furthermore it oversimplifies the political process, “politics is not always a rational process: ideology, belief and symbolism can play as important a role as substance”

Using the British negotiations around the Maastricht Treaty as an example, divisions within the Major Cabinet “crucially affected the position eventually adopted by the Prime Minister” an ideologically divided Cabinet had forced Major to change his policy views on Maastricht so as to avoid a critical split.

LI appears in this instance to be able to answer only economic issues with regards to government policy formation, and is unable to answer questions of a political nature, which formed a considerable part of the Maastricht negotiations. Moravcsik however has admitted that LI is difficult to adapt to non-economic areas, but for a theoretical approach that aims to have a “broad and predictive ambition” this admittance only serves to undermine further his own theory.

In particular LI fails again to understand the character of IGC’s in its statement that large states dominate the agenda , large states may dominate the agenda on some issues, but “unanimity is required for a treaty amendment” , this coupled with the fact that unanimity voting rules are used for most of the key decisions in the EU and that the ‘Luxembourg Compromise’ discussed earlier is still in force shows the fallibility in Moravcsik’s argument.

In light of this, it becomes clear that Moravcsik’s use of IGC’s in attempting to elucidate his theory only serves as an own goal by his admittance that his theory fails on political issues, as intergovernmental negotiations have “at their core a political process”,

The LI view that supranational institutions do not matter is challenged by Kassim and Menon, LI they state “underestimates the Commissions ability to act as a policy entrepreneur” , empirical studies have been carried out which shows that the Commission plays a considerable role in European integration.

Using the example of airline travel the Commission backed by the European Court of Justice (ECJ) enforced the competition rules of the Community against the wishes of the national governments who at the outset rejected it .

This view that the institutions of the Community shape the process of integration can be explained by Neoinstitutionalism or ‘New Institutionalism’.

LI therefore “must be supplemented by other models” to explain the process of European integration.

Both Neofunctionalism and LI are described as ‘grand theories’ of European integration. Both of which have emerged from international relations thought. It is argued that if the EU can be likened to a state then the theoretical lenses we use to analyse it can be drawn from schools of thought that analyse nation-states or so called ‘middle-range theory’. New institutionalism (NI) is one such theory.

The main idea behind NI is “institutions affect outcomes” . NI differs to Neofunctionalism in that it does not need to differentiate between high and low politics, the rules of interaction affect the conduct of social actors at all levels.
NI differs to LI in that LI “ignores the endogenous effects of EU membership” on the process of European integration.

There are three schools of thought under the NI umbrella: Historical institutionalism (HI), rational choice institutionalism (RCI) and sociological institutionalism (SI).

HI focuses on the “distributions of power that are produced by institutional arrangements” over time. The result of these institutional arrangements gives rise to the member states losing their hegemony of the integration process . Institutions, “once established, can become subject to increasing returns or lock in effects, constraining the behaviour of the actors who established them”

RCI focuses on how institutions limit the “rational actions of political actors” and how these institutions mould the integration process through these actors. States when faced with these institutions change their conduct towards them and use them to reach their end objectives , thus acting rationally.
RCI shares with LI the view that states combine interests from their constituents and then present these ‘rationally’ at European level.

SI by contrast focuses on how institutions alter the “preferences and even identities of national elites involved in the process of European integration” these can often be culturally explained , and include ‘informal norms and formal rules’, the difference being that SI see these norms and rules as institutions themselves.

HI takes up a position which encompasses both SI and RCI . In comparison to RCI, HI shares the view that member states “intentionally create institutions to solve collective action problems” HI shares with SI the view that as time progresses, “institutions help to reinforce culture and condition responses to potential and real change” , as such I will focus on HI when assessing NI theory and its attempt to explain the process of European integration.

How then does HI explain the process of European integration? Well as explained before HI contends that the “current functioning of institutions cannot be derived from the aspirations of the original designers” as time progresses ‘gaps’ emerge between how the member states want integration to progress and what the institutions at EU level do. These so called gaps emerge for four reasons.

Firstly the institutions at European level given their new nature as political actors will seek to develop their own interests, these interests may differ from those of the member states who created the institutions.

Reference can be made here to the ECJ which over the course of several decades has steadily ‘constitutionalised’ the integration process in its own view with its rulings. This is because of the supremacy of EU law over national law . For example in 1990 in the case Barber vs. Guardian Royal Exchange Assurance Group, the ECJ ruled that,

occupational pensions are a part of an employee’s pay and must therefore comply with Article 119 of the EEC Treaty dealing with equal pay for men and women… the Court stated that it was contrary to Article 119 to impose different age requirements for men and women on conditions for obtaining pensions on compulsory redundancy under a private pension scheme

thus the ECJ deepened the integration process and extended EU competency into new fields.

Secondly, politicians in the various member states all face elections; as a result they will tend to focus on the short term goals, while EU institutions by the complex nature of integration will need to focus on the long term goals or as Pierson puts it “Long term institutional consequences are often the by products of actions taken for short term political reasons” .

Using an aforementioned example, in the negotiation of the Maastricht Treaty, John Major could not afford to face a serious backbench revolt over the ‘Social Chapter’ so close to an election as such a deal had to be struck with the 11 other member states to have a separate social protocol which would see Britain excused from enforcing any legislation under this new protocol.

The third gap to cause member states to lose control of the integration process is tied in with the Neofunctionalist logic of spill-over mentioned earlier, that of unanticipated outcomes .
‘Issue density’ causes the necessity of member states to assign resolutions to specialists due to time restrictions and lack of technical knowledge; these can result in unforeseen outcomes . In the intervening period between IGC’s (the ‘gaps’ being discussed) “flesh must be added to the skeletal frameworks” how this ‘flesh’ is added is up to the European institutions.

Furthermore issue density results in spill-over, as mentioned before spill-over occurs when it becomes difficult to confine integration to just one policy sector due to the close knit nature of modern economies which further causes unforeseen outcomes ,.

The final gap concerns that of policy preferences, over time with subsequent enlargements policy coalitions at European level will change , after all with each subsequent enlargement the numbers in the Commission, Council of Ministers, European Parliament and ECJ change to reflect the new size of the Union, with most of these institutions having one member from each member state.
In the Council the accession of ten new member states in 2004 significantly altered the Franco-German alliance that had previously existed, now a coalition between Britain and the new member states based around “pro-American, economically liberal views” had developed, shifting the possible policy outcomes. One such example is the appointment of José Manuel Barroso, an advocate of liberal economics and a supporter of the Iraq war, as president of the European Commission in 2004 over Guy Verhofstadt the choice of the Franco-German Alliance .

Does HI fully explain the process of European Integration? Much like the other two theories discussed it does not. It comes some way in doing so in comparison to the other theories, by encompassing both Neofunctionalist and LI views, but fails in placing institutions above member states, after all “national representatives are present at key stages of the policy process” and while institutions may direct the process of European integration in the interim periods, the frequency of IGC’s means that the compass can be swiftly pointed in a new direction.

To conclude, can any theory explain the process of European integration? Yes, several can, and over the last few pages the approaches of Neofunctionalist LI and HI have attempted to, but when the question is asked can it do so fully? The answer is no.
European integration is a complex process with differing theories being appropriate to explain different areas of integration . This process is an ongoing one described as a “social scientific puzzle” trying to explain the full picture of any puzzle that is ongoing and therefore incomplete is clearly impractical. It is not a fruitless process however as by seeking to explain the whole process of integration, integration theorists have provided us with the tools to extract an explanation of at least some parts of it.

To add to Tranholm-Mikkelsen’s summation of Neofunctionalism ; if Neofunctionalism explains the parts that make the elephant move, then LI explains the part that chooses the direction to move in and NI explains the parts that keep the elephant from falling over.


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  1. Thanks for raising this question of the motor of integration, as it is fundamental to progress and at present the source of confusion. Functionalist/neofunctionalist and other theories got everyone on a wrong track, as they (1) used American models like Haas et al (2) did not do thorough research into Community origins. The other theories too often just followed in their mistakes. The original motor of integration was not the Common Market but the Coal and Steel Community of 1951, which is very little analyzed by these economist/ political theorists (see http://www.schuman.info/proppurp.htm ). (3) In contrast with these theories I have not found any problems with what Schuman said about the theory and practice of applying supranational principles to create in the long-term a democratic management system for the whole of Europe. He said it would start an unstoppable process, he was sure about its longevity of the Community core, and the checks and balances — seen in the long term — have so far proved quite adequate to ensure a certain level of democracy is maintained (although we are now going through another denial of this by the politicians who brought in the Lisbon / constitutional treaty against the wishes of voters expressed in referendums.) Thus Schuman provides predictive capacity, the main purpose of a useful scientific theory. Schuman himself called the process he started a ‘scientific experiment’ in democracy. It has the main attributes of science.

    The major mistakes in the premisses of the theories include (1) lack of inclusion of the ECSC (2) assumption that Monnet was the originator. He wasn’t. And he had no working theory of Community integration rather than just an idea of a single market like USA (3) lack of analysis what the key idea of supranational democracy is. (4) Confusion about the term supranational plus lack of any reference to Schuman’s writings and speeches about the concept of the supranational. Schuman, a lawyer, prime minister, wrote a book on supranational democracy and gave scores of speeches. These are ignored, for reasons only known to the would-be theorists. Schuman said that the Community was the first example of a supranational institution in history — an indication that it is worth studying as a concept in terms of its origin and purpose (which is what the site http://www.schuman.info aims to do). Monnet had nothing to do with this ‘supranationality concept’ as he admits in the Memoirs (see the series of articles about Monnet on the site Monnet1.htm etc to Monnet7.htm ) (5) Integration is firmly based on a theory and practice of law, as later academics acknowledge. (6) It is also based on a historic analysis of constitutional theory (7) It also relates to a concept of political and moral philosophy that is not reflected in the theories I have seen. ‘Step by step’ = pragmatism or the accumulation of wisdom and trust, not ‘spill over’. (8) the motor has little to do with US federalism and more to do with international law theories. The European system is the only one with a supranational Commission or High Authority. What is it for? How should it operate according to the treaties? Does it do so in practice? What about the elections of civil society bodies that have never taken place yet? What about the areas where politicians opposed the treaties by ‘illegal’ action, according to the Founding Fathers? (9) Are the theories descriptive only? They make little distinction between actors acting legitimately or illegitimately against the integration process and those acting in harmony with its democratic principles of supranationality. For example is de Gaulle a part of what they are trying to describe? Mrs Thatcher? Mr Barroso? Are they for or against? Are all politicians honest? Does it matter in a theory? (10) I have never seen any of these theorists (though I have stopped reading much of the literature) refer to what the European Founding Fathers called the great Charter of the Community (Magna Carta) signed almost 60 years ago on 18 April 1951 defining the principles of interdependence and democracy as well as the unity of Europe. http://www.schuman.info/EuropeDeclaration.htm This is equivalent to the Declaration of Independence for the US, according to the Founding fathers. Its lack in the literature gives me little confidence that the theorists have done their homework. It is based on a concept that is ill-defined or not defined by the theorists — the supranational.

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