Dismantling the Ancien Régime: Public Service Liberalization in the EU and the Vulnerability of Sector Regimes

Asano, Yasuko (2009) Dismantling the Ancien Régime: Public Service Liberalization in the EU and the Vulnerability of Sector Regimes. In: UNSPECIFIED.

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Abstract

How was it possible for public services to be liberalized in the EU despite a history of strong government control? Much of the literature on this issue has developed around the argument over the impact of EU institutions on the liberalization process. But the fact that liberalization is not an EU-only phenomenon poses problem: did EU institutions really matter? The paper tries to assess the relative impact of EU institutions and non-EU factors, especially the role of institutions at the sectoral level which has largely been ignored. Liberalization of public services involves the difficult task of dismantling an ancien régime which justified and supported monopolization, and of setting up a new one. Thus, it is highly likely that the vulnerability or strength of the former regime will affect the prospects of liberalization at the EU level. Against this backdrop, the paper focuses on “sector regimes” that governed service provision in each sector. Introducing the framework of sector regimes has several advantages. First, it allows us to trace and explain the agenda-setting process and preference change of member states in a dynamic way. Secondly, it helps us predict how likely member states' preferences are to converge. Thirdly, it allows us to see that the nature of relationship between member states and EU institutions is not a uniform one, but that it is in fact shaped by the vulnerability of sector regimes. The paper examines two cases, the liberalization of air transport and telecommunications services. The case studies show that liberalization of the two services was brought by the subsequent weakening of national sector regimes, and find that the impact of EU institutions was greater in the telecommunications sector than in the air transport sector due to the difference in vulnerability of the sector regimes.

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