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A Principal-Agent Approach to the Study of Cohesion Policy Implementation

European Union
Differentiation
Policy Implementation
Member States
Claudia Gloazzo
University of Strathclyde
Claudia Gloazzo
University of Strathclyde

Abstract

The European Union is characterized by various powers being spread out among different levels of government (EU, national, sub-national) and government actors (states, regions, local authorities). This configuration influences the implementation of European Union policies, as different actors at various levels may adopt distinct policy solutions. Policy implementation in multi-level governance arrangements is in fact transferred to a wide range of actors, each adopting different policy solutions and policy instruments within the legal framework provided for by EU institutions. In terms of policy instruments, Cohesion policy funding has traditionally been made available to citizens through grants. In the last 15 years however new policy instruments (loans, guarantees and equity funds) have been adopted and increasingly used. The European Commission promotes these financial (engineering) instruments (FI) as a sustainable, efficient and qualitatively better way to spend EU money. This rationale for policy intervention has not yet been researched in relation to its implications for the governance of Cohesion policy. Financial instruments rely on actors of different nature (public, private, mixed) which are delegated crucial management and implementation tasks. Moreover FI are implemented through more complex structures than grants. These rely on the delegation of tasks and reponsibilities in a chain of multiple Principal-Agent and accountability relationships. This paper suggests a typology of various governance arrangements applied to the implementation of Cohesion policy, when financial instruments are used. By comparing three types of governance arrangements (public in Germany, private in the UK and mixed in Italy) and drawing on a mixed database of quantitative and qualitative resources, the researcher provides insights on how these different types work in practice. It also intends to highlight how the different policy solutions adopted in various countries cope with the Principal-Agent problem of delegation of tasks and responsibilities from public officials to the other actors involved in the management and implementation of the funds. Finally the researcher will talk throught the implications for public accountability and policy performance. This paper contributes to the MLG and the delegation literature, by providing an overview of empirical solutions adopted in the policy implementation of Cohesion policy.