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Intrinsic vs. extrinsic incentives for reform: An informational mechanism of E(M)U conditionality
The Review of International Organizations ( IF 4.5 ) Pub Date : 2020-07-07 , DOI: 10.1007/s11558-020-09387-w
Nikitas Konstantinidis , Yannis Karagiannis

How does the prospect of accession to an international union affect a non-member-state government’s incentives to implement political and economic liberalization reforms? To answer this question, we propose an informational mechanism of international union accession conditionality drawing on Bénabou and Tirole’s (The Review of Economic Studies, 70, 489–520, 2003) formalization of intrinsic and extrinsic motivation. In a Bayesian game of union accession between a supranational principal (e.g., EU Commission) and a national agent (e.g., the government of the target country), we find that the extrinsic bonus of post-accession transfers may on the one hand reinforce the agent’s short-term incentives to meet the accession criteria but on the other hand can also “crowd out” its intrinsic motivation to liberalize and comply with the union’s acquis in the long run. As a result, we expect that (i) net-recipient countries’ post-accession pace of reform may decline or even turn negative over time (temporal effect), (ii) the crowding-out effect will be stronger for countries that enjoy higher levels of distributive net transfers and those that go through a lengthier negotiation period (spatial effect), and (iii) early liberalizers are ex ante more likely to be officially selected as union candidate members, accept the accession contract, and implement the required reforms. We illustrate the theoretical mechanism and dynamics of the model with anecdotal evidence from two paired comparisons in respect to the effects of economic conditionality attached to EMU accession (Greece vs. Spain) and political conditionality attached to EU accession (Hungary vs. Estonia).

中文翻译:

改革的内在动力与外在动力:E(M)U条件的信息机制

加入国际联盟的前景如何影响非成员国政府实施政治和经济自由化改革的动力?为了回答这个问题,我们基于贝纳布和蒂罗尔(《经济研究评论》,2003年第70期,第489-520页)的内在动机和外在动机的形式化,提出了一种国际加入条件的信息机制。在超国家主体(例如,欧盟委员会)与国民之间的贝叶斯联盟加入博弈中代理商(例如目标国家的政府),我们发现加入后转移的外部奖励一方面可以增强代理商满足加入标准的短期动机,但另一方面也可以“挤出市场” ”它的内在动机放宽,符合工会acquis从长远来看。因此,我们预计(i)净接受国的改革步伐可能随着时间的流逝而下降甚至消极(时间效应);(ii)拥挤国家的拥挤效应将更强。分配净转移的水平以及经过较长谈判期的转移水平(空间效应),以及(iii)早期的自由化者是事前更有可能正式被选为工会候选人,接受加入合同并实施所需的改革。我们从两个成对的比较中说明了该模型的理论机制和动力学,这些证据是关于加入EMU的经济条件(希腊对西班牙)和加入欧盟的政治条件(匈牙利对爱沙尼亚)的成对比较。
更新日期:2020-07-07
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