The developmental state in global regulation: Economic change and climate policy
| Author | Jonas Meckling |
| DOI | 10.1177/1354066117700966 |
| Published date | 01 March 2018 |
| Date | 01 March 2018 |
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https://doi.org/10.1177/1354066117700966
European Journal of
International Relations
2018, Vol. 24(1) 58 –81
© The Author(s) 2017
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DOI: 10.1177/1354066117700966
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The developmental state in
global regulation: Economic
change and climate policy
Jonas Meckling
University of California, Berkeley, USA
Abstract
What are the origins of global regulation? This article proposes that the developmental
state — the state investing in economic development — can be a source of global
environmental regulation. Through industrial policy, the developmental state can
promote structural economic change in polluting sectors that supports global regulatory
policy in two ways: first, providing state support to green industries creates economic
interests in support of global regulation; and, second, driving down the cost of
technology through government subsidies alters the pay-offs of global cooperation for
other states. This article examines the two mechanisms in the case of climate change:
the global leadership of the European Union; and international cooperation on the Paris
Agreement. The argument advances our theory of the state in global regulatory politics
as both a developmental and a regulatory force. This article identifies significant scope
for the developmental strategies of major economies to change the interest and cost
structures of polluting sectors to support global environmental regulation.
Keywords
Business, climate change, developmental state, global environmental politics, global
regulation, regulatory state, renewable energy, technology
Introduction
Global regulatory policy has grown rapidly over the past few decades. Yet, the extent of
regulatory cooperation varies significantly across issue areas. In global environmental
politics, for instance, the 2013 Minamata Convention on Mercury achieved international
Corresponding author:
Jonas Meckling, Department of Environmental Science, Policy, and Management, University of California,
Berkeley, 130 Mulford Hall, Berkeley, CA 94720, USA.
Email: meckling@berkeley.edu
700966EJT0010.1177/1354066117700966European Journal of International RelationsMeckling
research-article2017
Article
Meckling 59
cooperation, while efforts to cooperate on climate change faced gridlock for more than a
decade. Research shows that the success or failure of global regulation depends on the
interests of powerful states, notably, the US and the European Union (EU) (Drezner,
2007; Vogel, 1996). The literature offers two predominant explanations for the global
regulatory policy of these states: government officials with a high degree of autonomy
formulate policy, or powerful business interests shape policy (Falkner, 2008; Hopgood,
1998; Mattli and Woods, 2009). These explanations of global regulatory policy build on
a theory of the state as regulator: state officials either impose global rules on business, or
business interests capture the rule-making process.
This article extends our understanding of the state in global environmental regulation
to include the developmental state — the state that intervenes in economic sectors to
promote structural economic and technological change. While scholars have historically
understood the regulatory and the developmental state as two distinct state forms (Evans,
1995; Johnson, 1999; Wade, 1990), I argue that regulatory and developmental strategies
coexist in modern economies.1 The governments of the US, Europe, and China engage in
both environmental regulation and green industrial development, though their industrial
policy styles and apparatus differ from those of the classic developmental states in East
Asia. Modern industrial policy is not dirigiste state planning, but focuses on providing
policy direction and support for innovation-oriented private sector activity (Rodrik,
2007; Stiglitz et al., 2013). Importantly, the developmental state’s ability to intervene in
the economic structure of polluting sectors2 with industrial policy can support global
regulatory policy through two mechanisms: first, providing government support to clean
technology industries grows business interests that are in favor of global regulation,
which helps to overcome opposition to regulation; and, second, incentivizing the devel-
opment and use of clean technology lowers technology costs, which alters the pay-offs
of global regulation for other states. The developmental state can thus reconfigure busi-
ness interests and reduce the adjustment cost of global regulatory cooperation. The argu-
ment advances our understanding of agency in global environmental regulation,
highlighting the role of developmental state actors and sets of states championing new
technologies. It also contributes to the growing debate on the dynamic interaction of
market and technology development, on the one hand, with global environmental regula-
tion, on the other (Kim and Urpelainen, 2013; Vormedal, 2010).
This article examines the argument with regard to global climate politics, which was
widely considered a failure (Hale et al., 2013; Victor, 2011) as fossil fuel interests largely
captured the domestic and international regulatory process (Ciplet et al., 2015; Levy and
Newell, 2002). As a result, a fragmented regime of weak market-based governance
emerged (Meckling, 2011; O’Neill, 2017). Within this picture of regulatory failure, two
policy successes stand relatively tall: the persistence of global leadership by the EU; and
global cooperation on the Paris Agreement of 2015. This article argues that the develop-
mental state enabled these two outcomes by changing the economic structure of the
global energy sector. The notion of economic structure, here, refers to the relative weight
of clean technology and polluting business interests and the relative costs of clean and
polluting technologies. This emerging structural economic change has affected regula-
tory outcomes in two ways: first, the creation and growth of clean energy interests in
Europe has helped fuel the EU’s global regulatory leadership on climate change; and,
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