The origins of European competition policy: redistributive versus ideational explanations

Abstract

This article examines the origins of European competition policy. Whereas a new and influential view holds that German ordoliberal ideas were the driving force behind the emergence of that policy, I argue that such ideational explanations are theoretically unconvincing, methodologically biased and substantively wrong. Based on a careful observation of the most relevant actors' preferences, the terms of their interaction during the Paris negotiations of 1950–51, and the institutional context of their operations, I conclude that French planners' preferences, German reactions and US policy must all be examined together to produce a more convincing account of the emergence of the most supranational of all European policies. The finding that European competition policy emerged out of an acrimonious bargaining episode between pro-competition French bureaucrats and anti-competition German politicians points to the redistributive nature of European competition rules, and thereby severely challenges ideational theories, liberal-intergovernmentalism and delegation-for-credibility theories alike.

Keywords:

• Competition policy
• ideational accounts
• origins
• redistributive motives

ACKNOWLEDGMENTS

I wish to thank Pinar Akman, Giuliano Amato, Carles Boix, Juan Diez Medrano, Klaus-Dieter Ehlermann, José Fernandez-Albertos, Andreas Gofas, Fred Halliday, Adrienne Héritier, Christian Joerges, Jacint Jordana, Hussein Kassim, Nikitas Konstantinidis, Elia Marzal and Nikolaos Zahariadis, as well as the JEPP referees, for their comments on earlier versions of this article. All remaining errors are mine.

Notes

For example, Majone has incorrectly argued that ‘When the Treaty of Rome was signed only Germany, among the founding members, had a forceful antitrust law and a forceful regulatory body, the Federal Cartel Office, to implement it’ (Majone 1997: 145). In fact, that law was enacted on 1 January 1958 – seven years after the signing of the Treaty of Paris of 1951, and eight months after the signing of the Treaty of Rome of 1957. The causality may therefore be running exactly contrary to Majone's interpretation.

Moravcsik makes similar factual mistakes, which also bias his theoretical conclusions. He locates the beginning of ECP in 1957, and argues that ‘The Spaak Report, at Erhard's insistence, had called for regulation of monopolies and trusts as well as state subsidies. Provisions for action against mergers, monopolies, and dumping (Articles 85–86) were limited, applicable only for mergers and monopolies at the European level’ (Moravcsik 1998: 149). In reality, neither did Erhard need to insist to create ECP, nor is it accurate that the Treaty of Rome contained merger provisions (this occurred only as late as 1989, with the passage of Council Regulation 4064/89).

Gerber argues that both the emergence and the evolution (i.e., the implementation) of ECP rules are owing to ordoliberal ideas and actions. The present article critically re-examines only the first limb of his argument on the emergence of these rules.

‘La continuation du relèvement de la France sera arrêtée si la question de la production industrielle allemande et de sa capacité de concurrence n'est pas réglée rapidement. … Du point de vue français, une telle solution [i.e., what became the Schuman Plan] met l'industrie française sur la même base de départ que l'industrie allemande, élimine le dumping à l'exportation qu'autrement poursuivrait l'industrie allemande de l'acier. Elle fait participer l'industrie d'acier française à l'expansion européenne, sans crainte de dumping, sans la tentation du cartel. Les prix de l'acier baisseront en France’ (Monnet in Reuter 1980: 166–7).