Structural Conditions and the Propensity for Regional Integration
| Author | Gaspare M. Genna,Brian Efird |
| Published date | 01 September 2002 |
| Date | 01 September 2002 |
| DOI | http://doi.org/10.1177/1465116502003003001 |
| Subject Matter | Articles |
Structural Conditions and the
Propensity for Regional
Integration
Brian Efird
Decision Insights, Inc., USA
Gaspare M. Genna
Winona State University, USA
ABSTRACT
This paper proposes a theory for regional integration based
on structural conditions. By applying power transition
theory, we are able to account for and anticipate not only
the tendency for pairs of countries to participate in inte-
gration, but the likely intensity of such integration as well.
We find that integration is most likely when there is an asym-
metric distribution of power between countries and when
they are jointly satisfied after a power transition has
occurred. These results hold even after controlling for level
of development and trade flows. We test this theory on all
politically relevant dyads between 1950 and 1996 using a
novel method to measure the level of regional integration.
We illustrate the empirical findings through simulations that
track the developments leading to Europe’s Economic and
Monetary Union (EMU).
267
European Union Politics
[1465-1165(200209)3:3]
Volume 3 (3): 267–295: 026075
Copyright© 2002
SAGE Publications
London, Thousand Oaks CA,
New Delhi
KEY WORDS
integration theory
power transition
structural conditions
EMU
Introduction
This paper applies power transition theory to the process of regional inte-
gration. This work explains why some countries wish to develop integrated
economies while others do not. This allows us to identify those regions where
supranational political institutions are likely to form, as well as to suggest
how likely they are to endure. Current integration research suffers from not
including relative power changes and status quo satisfaction in its attempt to
explain or predict the development of supranational political institutions. We
hope that our work begins to correct this deficiency. Power transition theory
has traditionally been applied to war decisions. However, this theoretical
framework is readily applicable to the question of regional integration
because it provides a structural explanation of the international system based
on the interrelationship between the relative power of countries and their
degree of satisfaction with each other – there is no need for this explanation
to be limited to conflictual relations. In particular, we will show that a change
in the relative power of countries explains the development of integration
through the role of cooperative behavior in a country’s economic growth.
Since the heart of integration is enduring cooperative behavior among coun-
tries, power relationships combined with the degree of satisfaction with a
potential ally can facilitate these cooperative agreements. The theory pre-
sented here addresses these conditions.
Regional integration involves a non-coerced process in which economic
coordination and adjustments produce a merger of economic and political
institutions among countries. The non-coerced aspect of this concept sepa-
rates integration from empire building. Integration also includes the ability
of a merged entity ‘to maintain itself in the face of internal or external chal-
lenges’ (Etzioni, 1965: 330) and to depend upon ‘peaceful change among its
population’ (Deutsch et al., 1957: 5). These attributes require that common or
supranational institutions be adopted and that they, more or less, become the
new centers of decision-making (Haas, 1958; see also Tsebelis, 1994; Stone
Sweet and Sandholtz, 1997). To explain integration, therefore, requires an
understanding of the structures that drive this process. We argue that two
forces – asymmetric power relations and status quo satisfaction between two
countries (referred to as dyads) – are crucial for explaining and estimating
the likelihood and intensity of integration.
We begin with a brief overview of some international relations theories
to assess whether they can aid in answering the broad question of this paper.
In particular, we are interested in how research in the field addresses the
development of supranational political institutions, given their importance to
the overall integration process. We argue that the development of regional
European Union Politics 3(3)
268
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