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Published online by Cambridge University Press: 26 October 2009
Member governments of the European Community have frequently urged the necessity of closer cooperation and collaboration in meeting the challenge posed by new technologies and in countering the lead achieved by the United States and Japan. After delays which seemed almost to contradict any sense of urgency, the Council of Ministers of the Community agreed to a multi-annual Framework Programme of Scientific Research in 1983. A critically important element of that Programme, the European Strategic Programme of Research and Development in Information Technology (ESPRIT), was agreed only after further extensive delays in February 1984. The renewal and extension of the Framework Programme was proposed by the European Commission in early 1986 but was finally agreed only in September 1987, the delay having been caused by the opposition of Britain, France and West Germany, the three member states largely responsible for the protracted negotiations on ESPRIT in 1984. Much attention has been paid to the history of the Framework Programme and ESPRIT, but the budgetary aspects of the decisions, aspects that were highly significant in delaying agreement, especially on the part of Britain and West Germany, have tended to be ignored.
1 See, for example, Arnold, E. and Guy, K., Parallel Convergence: National Strategies in Information Technologies, (London, 1986)Google Scholar; Jowett, P. and Rothwell, M., The Economics of Information Technology (London, 1986)CrossRefGoogle Scholar; Sharp, M. and Shearman, C., European Technological Collaboration (London, 1987).Google Scholar
2 For an application of the theory of collective action to international cooperation in research, see Bobrow, D. W. and Kudrle, R., ‘Energy R&D: In Tepid Pursuit of Collective Goods’, International Organization 33 (1979), 149–176.Google Scholar
3 For one application of the theory of collective action to the Community, see Cohen, B. J., ‘European Financial Integration and National Banking Interests: A Public Goods Approach’, paper delivered at the 1987 Annual Meeting of the American Political Science Association, Chicago, 09 1987Google Scholar.
4 In the mid 1960s, the US challenge was brought dramatically to the attention of the general public by Servan Schreiber, J. J. in his The American Challenge (London, 1967)Google Scholar.
5 Financial Times, 15 02 1984Google Scholar.
6 The Economist, 24 11 1984Google Scholar.
7 Wilmot, Robb‘The Market Perspective’, speech to the ESPRIT Technical Week 1985 (Brussels ITT Task Force, European Commission 1985)Google Scholar.
8 See the report on Forecasting and Assessment in Science and Technology, the FAST Report of 1982, reprinted as Eurofutures: The Challenges of Innovation (London, 1984)Google Scholar.
9 The twelve companies were: Bull, CGE and Thomson from France; AEG, Nixdorf and Siemans from West Germany; GEC, ICL and Plessey from the UK; Olivetti and STET from Italy; and Philips from the NetherlandsGoogle Scholar.
10 The administrative structure established for ESPRIT is set out in The Mid-Term Review of ESPRIT (Brussels, 1985)Google Scholar.
11 One hostile government would, in fact, have been enough to halt the project as unanimity was required in the Council of Ministers; ESPRIT and the Framework Programme were necessarily based on Article 235 of the Treaty of Rome as R&D did not as such come within the TreatiesGoogle Scholar.
12 For a general discussion of the budgetary arrangements then pertaining, see Strasser, D., The Finances of Europe (Brussels, 1980)Google Scholar and Wallace, H., Budgetary Politics: The Finances of the European Communities (London, 1980)Google Scholar.
13 See Denton, G., ‘Restructuring the EC Budget: Implications of the Fontainebleau Agreement’ Journal of Common Market Studies 23 (1984). A further complicating factor was that the European Parliament has continuously sought to enhance its role in the budgetary process but this is not pursued in this paperGoogle Scholar.
14 Agence Europe, 14 12 1983Google Scholar.
15 For the Commissions's statement as recorded in the Council's minutes, see Agence Europe, 20 02 1984Google Scholar.
16 Agence Europe, 6 12 1986Google Scholar.
17 The British Presidency in fact postponed the meeting of Research Ministers fixed for 22 December 1986 on the grounds that agreement was unlikely, even though a numerical majority remained in favour of the meeting (only the West Germans, French and perhaps the Danes supported the UK). Agence Europe, 11 12 1986. The fact that there were divisions in Whitehall between the Prime Minister and other interested ministers did not help either.Google Scholar See The Independent, 5 03 1987Google Scholar.
18 New Scientist, 26 02 1987Google Scholar.
19 Ibid.
20 Agence Europe, 26 03 1987Google Scholar.
21 For a discussion of full definitions of public goods, see Taylor, M., Anarchy and Cooperation (New York, 1976), pp. 14–15. Some of the goods we are concerned with here are somewhat divisible and hence are not pure public goodsGoogle Scholar.
22 The idea of free-riding is discussed in Olson, M., The Logic of Collective Action (Cambridge, Mass, 1965).Google Scholar For a discussion of a games-theoretic treatment of free-riding, see Taylor, M. and Ward, H., ‘Chickens, Whales and Lumpy Goods’, Political Studies, 30(1982), pp. 350–370.Google Scholar Also Hardin, R., Collective Action (Baltimore, 1982). Partial reform of the CAP might yield some marginal alleviation of pressure on the budgetary front without solving the structural problem of agricultural surplusesGoogle Scholar.
23 Com(83)358 Final. Proposal for a Council decision adopting ESPRIT, 2 06 1983Google Scholar.
24 On lumpy goods, see Taylor, and Ward, , ‘Chickens, Whales and Lumpy Public Goods’.Google Scholar
25 The Delors proposal (see Agence Europe, 9 01 1987) was the basis for the agreement on the Budget and CAP reform at the February 1988 European Council. As the 1984 VAT increase showed, without other changes, it might yield only a temporary respiteGoogle Scholar.
26 Relaxation of this constraint is perhaps possible: if the UK had linked the research budget to the size of the budgetary rebate, for example, it might have hoped to have got a reasonable research budget while paying less towards research by itself when its increased rebate was taken into account. Research, however, unlike the CAP, was too insignificant an issue on which to peg something as politically sensitive as a rebate claim.
27 The Financial Times (30 03 1987) calculated that for every £1 Britain spent on Community research, the Community itself spent £1.25 in BritainGoogle Scholar.
28 The classic texts are Niskanen, W., Bureaucracy and Representative Government (Chicago, 1971)Google Scholar and Downs, A., Inside Bureaucracy (Boston, 1967)CrossRefGoogle Scholar.
29 Agence Europe, 25 02 1987Google Scholar.
30 Denmark has in general supported budgetary constraint in the Community and seems to have been willing to move in the direction of the UK, West Germany and France during the bargaining over Framework (see Agence Europe, 20 12 1986). Italy and Greece were certainly the most vociferous opponents of cutting the Commission's proposal, though this does not necessarily indicate a desire for large budgetsGoogle Scholar.
31 We do know that the UK had a ceiling in mind (Agence Europe, 19 February 1987) but not the exact figure.
32 Voting was still relatively rare in 1986-87 but the Framework proposal had to be agreed unanimously. Voting weights, however imperfectly, reflect something of the real power balance because: (a) the threat of bringing a question to the vote is a potent one; (b) decisions within the unanimously agreed Framework were subject to majority voting; (c) given the increased significance of voting under the SEA, it must be assumed that member states viewed voting rights as close enough to the existing power balance. Our earlier analysis also suggests that members' net benefits are a single-peaked function of the size of the budget. Finally, the budget decision can be treated as essentially unidimensional, concerning the size of the budget. Hence the conditions for the existence of the core may be met (Ordeshook, Games Theory and Political Theory, pp. 361–64). In figure 3 the voting weights of members are placed in brackets under their names. The lower end of the core is France's budgetary optimum; the UK and West Germany do not have enough weight acting alone to constitute a blocking coalition but they would have enough weight in conjunction with France. The top end of the core is certainly above the Commission's proposal; the members of group three do have enough to constitute a blocking coalition and, by definition, all prefer a budget higher than the Commission's proposal.
33 This conclusion also holds good for the ESPRIT case. Under the slightly different voting weights then prevailing, the botto m end of the core was West Germany's optima while its upper would again have been at the optima of one of the members wanting more than the Commission's proposal.
34 Ideally rational choice theory would wish to explain such coalitions as they emerge rather than take them as given. See Ordeshook, , Games Theory and Political Theory, chapter 9, especially pp. 398–402, for suggestive ideas drawn from game-theoryGoogle Scholar.
35 Of the various games theoretic models of collective action which have been suggested, it is only in Chicken that each side clearly has an incentive to commit itself to non-cooperation; in Prisoners' Dilemma, a player committing himself in this way would find the other replying non-cooperatively, even in a super-game, and the same holds true in Assurance, for in each of these games the other player's rational response would be non-cooperation.
36 The seminal work on Chicken and its tactics is Schelling, T. C., Arms and Influence (New Haven, 1966)Google Scholar. See also Ward, H., The Risks of a Reputation for Toughness', British Journal of Political Science 17 (1986), 23fl52, which discusses allusions to Chicken in the literature o n national level budgetary politics and n-person ChickenGoogle Scholar.
37 The smaller the payoff differential between one's preferred outcome and the compromise, the less attractive is the strategy of sticking to commitments. See Ward, ‘The Risks of a Reputation for Toughness’.
38 Another way of seeing the budgetary bargaining game here would be to see it as strongly interlinked with budgetary reform. Thus the following game might arise: Plausibly, this game, too, might be regarded as Chicken, but we suggest that general budgetary and research budgetary matters are best regarded as two distinct games not a single one.
39 New Scientist, 8 10 1987, 24–25Google Scholar.
40 The best known statement of this point is in Allison, G. T., The Essence of Decision (Boston, Mass., 1971) especially chapter 1. This sort of position is often associated with the view that states do not have the information, the time, nor the ‘rational capacity’ to make optimal choices. We feel that though the decisions were complex, they were ‘transparent’ enough to apply ‘mainstream’ models of optimization as an organizing deviceGoogle Scholar.
41 On how power can be built into the rational choice approach to bargaining, see Ward, H., ‘A Behavioural Model of Bargaining’, British Journal of Political Science 9(1977), 201–218Google Scholar.
42 See, for example, Axelrod, R. and Keohane, R. O., ‘Achieving Cooperation under Anarchy: Strategies and Institutions’, World Politics 38(1985), 226–255, and other articles in this issue on regimesGoogle Scholar.
