Interests and Integration: Market Liberalization, Public Opinion, and European Union

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Figures 1. The Eastonian model of public support for European integration 2. Affective support for integration: 1985–91 3. National receipts from CAP spending 4. Occupational differences in support for integration by income 5. National dependence on intra-EU trade 6. Intra-EU trade balance 7. Fatalities from World War II 8. Electoral opposition to democratic capitalism

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Tables 1. Utilitarian Survey Questions 2. Affective Survey Questions 3. Factor Patterns (Standardized Solution) 4. Factor Patterns (Standardized Solutions) for Cross-Construct Two-Factor Model 5. Factor Patterns (Standardized Solutions) for Cross-Construct Two-Factor Model 6. Factor Patterns (Standardized Solutions) for Cross-Construct Two-Factor Model 7. Questions Pertaining to Integrative Policy 8. Correlations of Integrative Policy Variables 9. Testing the Eastonian Model of Support for Integration 10. Comparison of Measures of Affective Support 11. Attitudes on the Employment Prospects of European Integration 12. The Policy Appraisal Model of Support for Integration 13. Descriptive Statistics for the Dependent and Explanatory Variables 14. Occupation, Income, and Utilitarian Support for European Integration 15. Descriptive Statistics for National-Level Variables 16. The National Political Economy and Utilitarian Support for Integration 17. Proletariat Parties 18. Bourgeoisie Parties 19. Reexamining the Human Capital and Income Hypotheses 20. Reexamining the Human Capital and Income Hypotheses (continued) 21. Reexamining the Trade, Security, and Political Stability Hypotheses A1. Means and Variances for Indicators in the Confirmatory Factor Analysis Page xii → A2. Correlations among the Indicators for the Confirmatory Factor Analysis B1. Regression Results for the Control Variables for Table 12 B2. Regression Results for the Control Variables for Table 14 B3. Regression Results for the Control Variables for Table 16

B4. Regression Results for the Control Variables for Table 19 B5. Regression Results for the Control Variables for Table 20 B6. Regression Results for the Control Variables for Table 21 D1. Residual Means for the Regression Analyses in Table 16 D2. Residual Means for the Regression Analyses in Table 21 E1. Results for the Partisanship Control Variables in Model 2, Table 19 F1. Descriptive Statistics for Control Variables in Table 21

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Acknowledgments In the course of developing and completing this project, I have benefited from the intellectual and financial assistance of many people and institutions. First and foremost, I am greatly indebted to Harvey Palmer. This book grew out of our collaborative research that originated in a research design seminar directed by Larry Bartels at the University of Rochester. Harvey has provided valuable comments, advice, and reassurance throughout the writing of this book. Chapters 3 and 5 are based on manuscripts we have coauthored. Several institutions have provided assistance with this project. The Rotary Foundation funded my studies at the College of Europe in Brugge, Belgium. I acquired much of my interest in and knowledge of European integration during my year in Brugge. In particular, I learned a great deal from Professor John Pinder, my Master's Thesis advisor, and discussions with fellow students Anne Chambers, Michael Curtis, Steven Glick, Imelda Higgins, and Michael Vella. Mieke Lefevre at the College of Europe library was of great assistance with research. I wrote the dissertation on which this book is based at the University of Rochester. I am grateful to the department of political science for financial support and an active and stimulating intellectual environment. In particular, my dissertation committee of G. Bingham Powell Jr. (Chair), Richard Niemi, and Renee Smith provided helpful comments, suggestions, and guidance throughout the dissertation. Also, Ted Bird encouraged me to pursue the research questions addressed in chapter 4 of this book. Several colleagues at the University of Kentucky have helped me with revisions of the dissertation. Greg Hager graciously read several drafts of most of the book and offered astute advice and valuable encouragement. Moreover, at crucial points of frustration he provided both a patient ear and comic relief. Mark Peffley helped tremendously with revisions of chapter 2. Scott Hickey assisted with organizing and analyzing the Eurobarometer survey data. I have also benefited from the comments and assistance of several scholars of European politics. Imelda Higgins has provided valuable advice, guidance, and information about legal aspects of European integration. Page xiv → Chris Anderson, Russell Dalton, Richard Eichenberg, Simon Hix, Wayne Sandholtz, Hermann Schmitt, and Guy Whitten have made important comments and suggestions regarding previous drafts of the book. Finally, my parents and Becky Neal have provided encouragement and emotional support throughout the project.

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CHAPTER 1 A Citizens' Europe And why should there not be a European group which could give a sense of enlarged patriotism and common citizenship to the distracted peoples of this turbulent and mighty continent and why should it not take its rightful place with other great groupings in shaping the destinies of man? —Winston Churchill, September 19, 1946 I have always said that Europe must be unified, that this must be done gradually in the economic and cultural domains, later in the military domain and even in the political sphere. —Charles de Gaulle, November 14, 1949 That two of the most prominent European political figures were advocating European integration shortly after World War II is a testament to the dramatic impact of the war on European politics. Prior to the war, interstate rivalries fueled by nationalism characterized European interstate relations. These rivalries extended into the global arena, where European nations competed for territory and markets to promote their industrialization, trade, and national prestige. In turn the European nations became the most wealthy, industrially advanced, and internationally powerful nations in the world. However, these nationalist passions also led to two world wars. By the end of World War II, the European nations’ economies, empires, system of security, and international dominance were destroyed. Military conflict on the Continent severely damaged European industry, agriculture, infrastructure, and commerce. The war weakened European empires, which quickly dissolved in the years following the war. The European system of international security—based on fluid interstate alliances—was thoroughly discredited by its failure to prevent the two world wars. Furthermore, from this weakened international position, Europeans’ economic welfare and security were now vulnerable to international factors beyond their control. This was particularly apparent with the advent of Page 2 → the cold war, in which Europe became an ideological and potential military battlefield in the global confrontation between the United States and the Soviet Union. In sum, by the end of World War II the European nations had self-destructed. It was this legacy of internecine war that motivated many European elites—particularly from Western Europe—to abandon national rivalries and pursue cooperative solutions to their economic and security interests. The fundamental goal of these “integrationists” was to prevent the reemergence of nationalism by diverting public allegiances away from the nation-state and toward a supranational identity. As a means to this end, they proposed different forms of economic and political integration. The “federalists” led by Altiero Spinelli advocated the most ambitious program, which called for the immediate creation of a supranational constituent assembly that would draft a constitution for a “United States of Europe.” However, many national political leaders, while supportive of integration in theory, were unwilling to surrender their national sovereignty in practice. This national resistance to immediate integration effectively thwarted federalist initiatives at the 1948 Congress of Europe in The Hague and dreams of a swift integration of European nations and public allegiances. What eventually carried the day was an incremental approach to integration, championed by Frenchmen Jean Monnet and Robert Schuman. According to Schuman, “Europe will not be made all at once or according to a general plan. It will be built through concrete achievements, which first create a de facto solidarity.” Supranational governance would only be extended over noncontroversial—generally economic—policy areas that provide national benefits.1 This limited focus would secure the support of national governments. Monnet anticipated that, through this gradual extension of supranational authority over economic activity, national sovereignties would eventually enmesh in a supranational arrangement. In turn, the economic and political benefits of this integration would dilute nationalist sentiments, elicit public support for integration, and foster supranational allegiances. Progress in European integration has followed this incremental path. In 1951, six nations—France, Germany,

Italy, Luxembourg, Belgium, and the Netherlands—created a supranational authority to oversee the liberalization of commerce in coal, steel, and iron. In 1957, these nations created the European Economic Community (EEC) that empowered this supranational authority to create and manage an internal market for goods, services, labor, and capital.2 The European Economic Community has since expanded into a European Union (EU) consisting of fifteen West European nations and representing an unprecedented level of interstate political and economic integration. Unlike other international organizations, Page 3 → the EU institutions maintain an independent source of revenues and body of law. These institutions govern a vast array of economic and related policy areas: for example, agriculture, transportation, environmental policy, and international trade. In addition, the member states have laid the foundation for the adoption of a common European currency controlled by a supranational monetary authority. At each step in this process, the leaders of the member states have reaffirmed that the ultimate purpose of integration is a political transformation at the mass level: “an ever closer union of the peoples of Europe.”3 This commitment to public integration is also apparent in EU efforts to create European symbols of political identity. For example, as a result of the 1984 Fontainebleau summit of the leaders of the member states, the European Union adopted its own anthem and flag and initiated an EU passport and driver's license. More recently, the Commission has called for the introduction of an EU birth certificate, a “European dimension” in school textbooks, and an EU “Medal of Merit” that would outrank all other national honors.4 But while the degree of European supranational governance has clearly grown in the past forty years, it is unclear whether this process of integration has fulfilled its fundamental goal: a transformation in public attitudes. Have the economic benefits of integration promoted public support for European integration? Have citizens developed a supranational identity? Has this identity supplanted national allegiances? These are fundamental questions regarding the progress of European integration. In addition, answers to these questions are important for understanding the process of institutional and policy integration in Europe. Public attitudes play an important—sometimes crucial—role in determining the scope and speed of integration. This is evident from the two most recent attempts at institutional and geographic reforms of the European Union. In a June 1992 referendum, the Danish public effectively halted the further institutional and economic integration of Europe by rejecting the Treaty on European Union. Two years later Norwegian voters limited territorial integration by rejecting EU membership. Beyond referenda, public attitudes influence integration through more routine aspects of citizen politics: lobbying, public protest, and elections. Elected national officials respond to constituent interests on European policy just as they would on national policy. For example, in response to public opinion German leaders have recently pushed for a reform of the EU budget and a stiffening of the requirements for the adoption of a common European currency.5 In sum, mass attitudes toward integration are both a measure and a determinant of the process of European integration. The purpose of this book is to assess and explain these attitudes. Specifically, this book Page 4 → addresses two important questions: how do EU citizens structure their attitudes toward integration? and, why do they vary in their support for integration? Given that the focus of European integration remains primarily economic, I contend that the answers to these questions derive from an appreciation of how economic integration differentially influences citizens’ welfare and how economic welfare influences political attitudes. Accordingly, I develop an individual-level theory of support for integration based in economic theories of the distributional consequences of market liberalization and in political theories of attitude formation. I then support the theory with historical survey data of public attitudes toward integration. In so doing, this study provides a systematic explanation of public support for European integration, facilitating an assessment of the progress of European integration and an understanding of citizen politics in the European Union. This introductory chapter is organized as follows. First, I further discuss the substantive relevance of public attitudes to EU politics and the process of European integration. Specifically, I identify several important implications of the study of public attitudes for our understanding of European integration. Second, I review previous research on public attitudes toward integration so as to situate this study with respect to our current knowledge of the subject. Third, I introduce the basic theoretical argument of this study, the organization of the

book, and a brief preview of the empirical findings.

Public Attitudes and the Process of European Integration As a background for this study, it is worth discussing in detail several pertinent aspects of citizen—or mass—politics in the European Union. Citizen politics in the European Union are somewhat different from traditional national mass politics in Western Europe. In Western European nation-states, citizen politics generally concern influencing politics through existing, well-accepted political institutions: for example, elections, party systems, and representative legislatures. The “rules of the game” are occasionally disputed, but mass politics generally focus on influencing the outcomes of the political game, not how it is played. In contrast, the European Union is often referred to as a sui generis political system (Hix 1994, 1). Many of the EU political institutions—particularly those for popular influence—have recently changed or are only now emerging. The “rules of the game” are not well-established. As a result, the creation and stability of EU institutions are highly salient components of EU politics. Mass attitudes play important roles in the development Page 5 → of many of these institutions, such as the creation of an EU party system and the development of a legitimate supranational authority. Consequently, the results of this study have implications for conventional aspects of mass politics, but also for the stability and institutional development of the European Union. The following section discusses several components of citizen politics in the European Union that are relevant to this study. Constraining and Shaping Integrative Reforms Public attitudes affect European integration through popular influence on the EU decision making. The most dramatic and direct public influence on European integration is through public referenda. Currently only Denmark and Ireland require referenda on integrative reforms. However, other nations have held referenda, particularly upon accession to the European Union—most recently Austria, Sweden, Finland, and Norway. These ballots represent an important constraint on the geographic scope of integration, as the Norwegians’ rejections of membership in 1972 and 1994 demonstrated. Also, EU member states have voluntarily called referenda on integration. Although domestic political concerns often underlie these votes, they provide a forum for the discussion of integrative issues and the expression of public support or opposition. In 1989, for example, the Italian government called a referendum on whether the European Community should be transformed into a political union. The overwhelming public support for this initiative reinforced the Italian officials’ and diplomats’ enthusiasm for a federal Europe, furthering the integration process (Nugent 1994, 422). In contrast, the considerable public opposition to the French referendum on the Maastricht Treaty has had a lasting impression on French policy toward the European Union (Nugent 1994, 422). Finally, mass attitudes shape integrative reforms through representative channels. National parliaments that must ratify integrative reforms are accountable to their electorates. Similarly, national ministers who vote on EU policy are also electorally accountable and must therefore be sensitive to public attitudes. A dramatic example of this electoral constraint was the replacement of Britain's Prime Minister Margaret Thatcher due, at least in part, to her party's concerns about the electoral ramifications of her position on European integration. More commonly, public influence has been apparent on particular issues related to European integration, such as the sensitivity of French elected officials to public opinion regarding EU agricultural policy. It is also important to note that, even if the electoral constraint is weak, EU policymakers may be sensitive to public Page 6 → opinion because they desire to lead it. According to Stimson (1991, 9), “the politician who would influence the current of public opinion must swim it.” For these reasons, we need to learn about public attitudes toward integration to understand the process of European integration. Political Cleavages, the European Parliament, and EU Policy-Making Public influence on European integration is not limited to referenda and elections in the national arena. The legislative powers of the European Parliament (EP) provide a direct link between EU citizens and supranational

legislation. This is a relatively new channel of public influence. Until recently, EU bureaucrats in the Commission and national representatives in the Council of Ministers clearly dominated EU policy-making. The European Parliament, which is directly elected, had only a minor role in the legislative process. Recent reforms of the European Union addressed this “democratic deficit” by more directly linking citizens to policy-making. The Single European Act in 1987 and the Treaty on European Union in 1993 enhanced the legislative power of the European Parliament in EU policy-making. This link promises to become more influential in the future, as almost all proposed reforms of the European Union entail a further increase in the EP's legislative powers. This change in the legislative powers of the European Parliament should make citizens’ attitudes toward integration an important determinant of EP partisan politics and policy-making. Until now, voting behavior in the EP elections has largely reflected national partisan concerns rather than EU political issues (Eijk and Franklin 1995; Reif and Schmitt 1980). As a result, the representation of interests in the European Parliament was an artifact of national politics, not a reflection of cleavages in the electorate concerning EU policy or integration. This may change with the reforms of the European Parliament, as votes in EP elections acquire policy consequences. In turn, this encourages policy-oriented voting by the EP electorate (Garrett and Tsebelis 1996). An increase in policy-oriented voting would have two important consequences for policy-making and partisan politics in the European Union. First, public attitudes on integration would influence EU policy-making through their representation by members of the European Parliament. Second, EP partisan politics would increasingly reflect the social cleavages and political concerns of the electorate on EU policy. Consequently, in the future public attitudes toward integration should play a more important Page 7 → role in shaping EU legislation and the EP party system. To anticipate the consequences of such a transformation, we need to understand citizens’ attitudes toward integration. Popular Legitimacy for the European Union Besides their impact on policy, public attitudes are crucial to maintaining the stability of the EU political system (Gibson and Caldiera 1995; Wallace 1994, 81).6 Like most democratic governments, the authority of EU institutions depends on the consent and voluntary compliance of its citizens—that is, legitimacy.7 However, unlike most nation-states, the European Union lacks a supranational means of enforcement; there is no EU police force or army to coerce compliance with EU law. Consequently, EU authority stems exclusively from the voluntary compliance of national institutions and, ultimately, EU citizens. Indeed, perhaps the most remarkable aspect of European integration is that it has sustained and expanded a supranational authority without a means for supranational enforcement. Public affective allegiances and political identification with the EU institutions is an important source of legitimacy for the EU institutions (Lindberg and Scheingold 1970, 55). Widespread public allegiance to the European Union provides a stable source of legitimacy, ensuring compliance that is immune to temporary declines in the performance of governing institutions.8 Thus, we need to assess citizens’ affective attitudes toward the European Union in order to understand the extent of legitimacy for EU governance. This issue is extremely relevant for the further economic and political integration of Europe. Currently, the EU member states are considering several integrative reforms that are controversial at the mass level: the creation of a common European currency, foreign policy, and defense. The endurance of supranational governance in these policy areas depends on a public legitimacy that will buttress supranational authority through hard times.9 The Stability of the European Union, Institutional Reform, and the Democratic Deficit Finally, the structure of public attitudes toward integration is an important determinant of the success of institutional reforms of the European Union, particularly those designed to redress the EU's “democratic deficit.” The democratic deficit refers to the reduced public participation in Page 8 → and control over policy that resulted from moving political authority from the national to the supranational level. In general, proposals to

“democratize” the European Union share three demands: a true bicameral legislature, with EP assent required for all EU legislation; an EP power to propose legislation; and systematic majority voting in the Council of Ministers.10 The viability of these institutional reforms depends in great part on how Europeans structure their political attitudes and interests on EU policy. A large body of research has demonstrated that majoritarian democratic institutions, such as those proposed, are unstable in social settings similar to the EU polity—that is, plural societies (Lijphart 1996; Dahl 1989, 254; Lijphart 1977). Plural societies are defined by the close association of intermediary political institutions—political parties, interest groups, media, schools, and voluntary associations—with distinct segments of the polity. As several scholars have shown, the European Union is segmented along national lines (Hix 1994; Taylor 1991; Slater 1983). Plural societies are generally unstable environments for majoritarian democratic institutions because they impede cross-segmental compromise and heighten intersegmental conflict (Lijphart 1996, 1977). Lacking trans-segmental political associations, citizens generally perceive political conflict through segmental lenses. In turn, this adversarial political climate inhibits compromise, which leads to either immobilism or majority decisions that minorities consider unfair.11 Thus, the success of the proposed reforms of the European Union may depend crucially on how citizens define their interests regarding EU politics. If EU citizens identify their political interests regarding integration solely along national lines, then the introduction of majoritarian democratic institutions may serve to aggravate national political conflicts over EU policy and to reduce the prospects for compromise in a reformed European Union. As a result, the “democratic deficit” may be replaced by a crisis in the stability of the European Union. In sum, citizen politics are fundamental to the process of European integration. First, public opinion has a direct influence on integration through referenda and national representative channels. Second, in the near future mass attitudes are likely to shape the party system of the European Parliament and, as a result, the policy-making process. Third, public allegiances toward integration represent a fundamental indicator of legitimacy for the European Union and of European integration itself. Finally, the extent of public allegiances and the social division of attitudes toward integration are important determinants of the EU's institutional stability and the viability of institutional reforms. Page 9 →

Previous Research on Public Support for European Integration Scholars offer a variety of explanations for and descriptions of public attitudes toward European integration. Studies have used survey data to track support for integration and identify empirical regularities in individuallevel and aggregate-level support (e.g., Inglehart, Rabier, and Reif 1991; Hewstone 1986; Handley 1981; Feld and Wildgen 1976; Shephard 1975). However, this research has not produced a well-tested broad, comparative theory of public support for integration. A large portion of this research has focused on limited time periods and nations (or both). These studies provided post hoc accounts of public reactions to particular events, policies, or circumstances. For example, scholars attributed public opposition to the Maastricht Treaty in France to a variety of nationally idiosyncratic factors: low public approval of President Mitterrand, economic downturn, and public anxiety related to German reunification.12 While such specific circumstances may shape public support for integration, their impact on public attitudes is impossible to evaluate. The problem is that these conclusions were drawn from indeterminate research designs (King, Keohane, and Verba 1994, 46). For example, how can we determine whether public support for the Maastricht Treaty would have been greater if the French economy had been stronger? Without more frequent French referenda on the Maastricht Treaty under varying economic conditions, we have no way of assessing whether economic conditions influenced public support. Furthermore, such nationally or temporally idiosyncratic explanations—even if accurate—contribute very little to our understanding of why public attitudes toward

integration vary in other nations or other times. One would ideally like to account for public attitudes in specific circumstances as instances of a general explanation for public support. This would require a theory of public support for European integration. Scholars have applied several theories from comparative politics to public attitudes toward European integration. Ronald Inglehart's seminal work on value change in advanced industrialized democracies—the “Silent Revolution”—spawned two of the most frequently cited explanations for variation in support for integration: cognitive mobilization and value orientations (Inglehart, Rabier, and Reif 1991; Hewstone 1986; Inglehart 1970a; Inglehart 1970b). Cognitive mobilization refers to a citizen's ability to process information at a high level of abstraction. Value orientations refer to citizens’ political priorities, which Inglehart divides into two types: concerns about economic and physical security (materialist Page 10 → values) and concerns about human rights, the environment, and quality of life issues (postmaterialist values). Both of these explanations posit that citizens’ attitudes toward integration are stable, since cognitive skills and value orientations remain generally unchanged over the adult years. In contrast, Dalton and Eichenberg (1991) posited that individual-level support for integration is flexible. Based on an “economic voting” model, they argued that a citizen's support for integration reflects her evaluations of her personal and national economic situation. As economic evaluations improve, citizens should look more favorably upon governing institutions, including the European Union. While there is some evidence to support both Inglehart's and Eichenberg and Dalton's theories, none of the theories has fared particularly well under empirical scrutiny. Survey evidence casts doubt on the validity of the cognitive mobilization and value orientation explanations (Anderson and Reichert 1996; Inglehart, Rabier, and Reif 1991; Janssen 1991). Dalton and Eichenberg's (1991) individual-level theory has not been directly tested, but a national-level analysis produced rather weak results.13 However, one should reserve judgment on these theories because much of the empirical evidence is methodologically suspect. Empirical analyses of these theories—as well as most studies of public support for integration—have suffered from two important methodological problems. First, most studies arbitrarily designated particular survey questions as measures of public support for integration. Scholars rarely verified that particular questions were indicative of respondents’ support for actual integrative measures.14 Second, previous studies rarely controlled for potentially confounding factors (but see Anderson and Reichert 1996).15 Consequently, much of the evidence regarding these theories provides a poor empirical evaluation of their validity. I will return to these methodological questions and these theories in chapter 6.

An Alternative Theory of Public Support for European Integration In this book, I develop and test an alternative theoretical explanation of public support for integration. The general theoretical claim is that citizens vary in their support for European integration due to differences in the welfare they derive from the economic and political consequences of integration—particularly international market liberalization. This theory is based on three fundamental assumptions regarding (a) the structure of public attitudes toward integration, (b) how citizens appraise the consequences of integration, and (c) the process of political attitude formation. First, I contend that EU citizens structure their attitudes toward integration Page 11 → according to the Eastonian model of public support for governing institutions (Easton 1975, 1965). Briefly stated, the Eastonian model posits that citizens base their support for political institutions on their affective allegiances to these institutions and their utilitarian appraisals of institutional outputs and performance. Citizens with deep affective allegiances provide ardent and stable support, irrespective of their level of utilitarian appraisals. As affective allegiances decline, utilitarian appraisals exert an increasing influence on the level of support. Applied to the EU context, this model explains support for supranational governance as a function of citizens’ affective allegiance to the European Union and their utilitarian appraisals of the consequences of integrative policy, which are primarily economic. Consequently, this model specifies a theoretical connection between the

economic consequences of European integration and public support for integration. Second, I assume that citizens, in their utilitarian appraisals of integration, are self-interested. That is, citizens base their utilitarian evaluations on the welfare they personally derive from European integration. This assumption has its intellectual roots in the study of international political economy. Research in international political economy has shown that international economics—for example, the flows of goods and capital—significantly shape domestic politics through their impact on the economic interests of different segments of society (Eichengreen and Frieden 1994; Frieden 1991; Rogowski 1989; Gourevitch 1986). These studies used international economic theory to identify the distribution across society of economic benefits and costs from changes in international economic conditions. They then demonstrated how, based on this distribution, the affected segments of society responded politically in a fashion consistent with their economic interests. For example, Rogowski (1989) used the theory of comparative advantage to identify the winners and losers in different nations from international trade liberalization and contraction. He then traced the connection between these economic effects and the types of political coalitions that form between labor, capital, and landed interests concerning international economic policy. Implicit in this research is an assumption that citizens in these different segments of society adopt political attitudes and behavior based on their economic self-interest related to international economic policy. I contend that this same approach can explain differences in public attitudes toward European integration. European integration represents a specific international economic policy: the liberalization of the movement of goods, capital, labor, and services among the EU member states. According to international economic theory, this market integration differentially affects citizens’ welfare through its impact on competition in the Page 12 → markets for labor, capital, and goods. EU citizens experience different economic costs and benefits from European integration depending on their position in these markets. I expect citizens to appraise the utility of integration according to these costs and benefits and, according to the Eastonian model, incorporate these evaluations into their support for integration. It is important to note that EU citizens are generally uninformed and unconcerned about European integration and EU politics.16 Thus, I must make a third assumption: that EU citizens form these utilitarian appraisals without a sophisticated understanding of the economics and politics of European integration. Research on public opinion formation provides theoretical arguments and empirical evidence that support this assertion. Studies based on “rational ignorance” contend that citizens use cheap information available in their social and political environment to infer their likely personal benefits from particular policies. Through “cheap” information from informed elite, interest groups, associates, and the media, citizens can form attitudes that reflect their self-interest. In the subsequent chapters I discuss further and, where possible, test these three assumptions.

The Plan of the Book The book is organized as follows. In chapter 2, I present the Eastonian model of public support and empirically examine its applicability to the EU context. Using confirmatory factor analysis, I demonstrate that EU citizens organize their attitudes toward integration on affective and utilitarian dimensions. I then show that these two dimensions relate to support for actual integrative measures in the expected fashion, with utilitarian appraisals increasingly influential on support for integration as affective allegiances decline. The analyses support two important conclusions. First, few EU citizens demonstrate strong affective allegiances to the European Union. Second, due to the low levels of affective allegiances, utilitarian evaluations should be a significant determinant of most citizens’ level of support for European integration. Thus, to understand variation in support for integration, we need to know why citizens vary in their utilitarian support of integration. The remainder of the book focuses on this question. In chapters 3 through 6, I develop and test a theoretical explanation for variation in citizens’ utilitarian support of integration. I contend that, depending on their socioeconomic situation, citizens differ in their ability to benefit from the primary consequences of integrative policy—the liberalization of the EU market for goods, capital, labor, and services. In turn, I expect citizens to form utilitarian evaluations of integration based on these Page 13 → differential benefits. In developing this theory, I discuss how uninformed citizens are capable of making these

seemingly informed evaluations. In chapter 3, I use economic theory to identify how differences in citizens’ income, education, occupational skills, and proximity to intra-EU borders influence their level of benefit from integrative policy. The basic argument is that market liberalization expands economic opportunities for citizens owning financial and “human” capital at the expense of those lacking these resources. First, owners of financial capital benefit from the liberalization of the capital market that increases investment opportunities and the political power of capital relative to labor. Second, occupational competition puts a premium on adaptability that is linked to education and occupational skills—that is, human capital. In addition, I argue that the free movement of goods and citizens provides benefits to consumers and producers situated along intra-EU borders. Due to differences in the variety and price of consumer goods across EU member states, residents of intra-EU border regions have opportunities to exploit cross-border shopping that nonborder residents lack. I use a statistical analysis of survey data from 1975 through 1992 to demonstrate that differences in citizens’ occupation-, education-, income-, and residence-based benefits from integration are positively related to their utilitarian support of integration. In chapter 4, I explore how intraoccupational differences in the benefits of integration relate to variation in utilitarian evaluations of integration. First, based on theories of international economics, I identify differences in the benefits of integration among skilled and unskilled workers. These intraoccupational differences in benefits derive from market liberalization, which promotes a redistribution of labor and capital across the EU economy. For unskilled workers, market liberalization creates competition based on wages. Relatively low-wage workers benefit from the opportunity to seek higher paying jobs while relatively high-wage workers face increasing competition. For skilled workers, market integration introduces competition based on the value of the human capital they contribute to production. Skilled workers with relatively high levels of human capital derive greater benefits from integration than those with relatively low levels of human capital. Second, I contend that farmers, who are the primary recipients of EU spending, differ in their benefits of integration according to their level of EU financial compensation. Using a statistical analysis of survey and economic data from 1975 through 1992, I demonstrate that variation in utilitarian support among skilled workers, unskilled workers, and farmers is consistent with differences in these economic benefits of integration. Page 14 → In chapter 5, I concentrate on how national economic and related political benefits from integrative policy influence individual-level support. EU citizens derive varying degrees of benefits from integration depending on its effect on their national economies. In particular, the liberalization of intra-EU trade differentially affects national economies depending on the importance of intra-EU trade to the national economy and the nation's intraEU trade balance. The benefits of trade liberalization increase with the dependence of the national economy on exports and imports from the EU market and the competitiveness of national exports to the EU market. Through its impact on the national economy, European integration also has political implications. Recall that one of the primary motives for economic integration was to avert the recurrence of interstate rivalry that led to World War II. European integration appears to have achieved this security benefit. However, this benefit is not necessarily of equal value to all EU citizens. I contend that the value of this benefit varies across EU citizens depending on their national context—particularly the level of national loss from World War II. Finally, European integration has political consequences for citizens who support democratic capitalism as their national political economy. European integration, through its contribution to economic growth, contributed to the consolidation of democratic capitalism after World War II. I expect supporters of democratic capitalism to vary in the value they attach to this consequence of integration depending on their national context. I contend supporters increasingly value this political benefit as the level of national opposition or threat to democratic capitalism rises. By adding national political and economic data to the previously analyzed survey data, I provide statistical evidence that citizens’ utilitarian support for integration varies consistently with these national benefits from

integrative policy. In chapter 6 I test the robustness of these utilitarian explanations by reexamining their validity in light of potentially confounding explanations. I evaluate the utilitarian hypotheses while controlling for citizens’ economic perceptions, values, political awareness, cognitive mobilization, partisanship, and national economic conditions. In spite of these controls, the statistical evidence continues to indicate that citizens form their utilitarian evaluations of integration consistent with the theoretical explanations provided in the chapters 3 through 5. In addition, this analysis provides evidence that several often-cited explanations for support for integration are dubious.

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CHAPTER 2 Connecting Economic Integration to Public Support for European Integration Postwar efforts toward the economic and political integration of Europe were initiated in part to stimulate an integration of public attitudes: to develop a sense of European political identity and mutual obligation. To achieve this goal, proponents of integration such as Jean Monnet espoused a strategy based on “functional” logic: that supranational economic integration provides citizens with benefits that promote public loyalty to, support for, and political identification with supranational authority and governance (Slater 1983; Groom 1978; Shephard 1975, chap. 3). In turn, the creation of a public solidarity and a European identity provides legitimacy for supranational governance and support for further economic and political integration (Slater 1983; Shephard 1975, chap. 3). Over the past forty years, the European states have accomplished an impressive degree of economic integration, most evident in the emergence of a single market for goods, capital, labor, and services. However, it is unclear whether public attitudes have responded to this integration according to the functional logic. Have the economic consequences of integration inspired support for, allegiance to, and identification with supranational governance? This book attempts to answer this question. The subsequent chapters will investigate specifically whether the economic consequences of integration are related to support for integration. But prior to that investigation, we must identify more precisely how economic integration relates to political allegiances and support for integration. To this end, this chapter develops and tests a model of public support for integration that specifies the relationships between utilitarian evaluations of the economic integration, supranational political allegiances, and support for European integration. I adopt a model of public support that is based on David Easton's theory of public support for governing institutions (Easton 1965, 75). This model specifies how and under what conditions utilitarian evaluations influence support for European integration. Thus, insofar as utilitarian evaluations respond to the economic consequences of integration, the model provides a theoretical connection between economic integration Page 16 → and public support for integration. In addition, the model identifies how these utilitarian evaluations can translate into affective political allegiances that provide a stable source of public support—or legitimacy—for supranational governance and integration. Several previous studies have applied the Eastonian model to the EU context, but none has verified its assumptions regarding the structure of public attitudes (e.g., Niedermayer and Westle 1995; Inglehart, Rabier, and Reif 1991; Shephard 1975; Lindberg and Scheingold 1970). Consequently, whether the model applies to public attitudes toward integration remains an open question. In this chapter, I provide empirical evidence that this model does indeed explain how EU citizens organize their attitudes toward integration and determine their support for integration. I then use the results of the analysis to appraise the level of citizens’ European identity and sense of mutual obligation—primary indicators of the extent of European integration and of legitimacy for supranational governance. The evidence supports two conclusions: that few citizens express strong affective allegiances to the European Union; and, consequently, that utilitarian evaluations of economic integration are a significant determinant of public support for integration. Before commencing, a preliminary note should be made concerning terminology in this book. Throughout the study, I treat the European Union (EU) and the European Community (EC) prior to 1993 as synonymous with European integration. The European Union currently represents the accumulated progress of European political and economic integration. In addition, further geographical, political, and economic integration are considered within the framework of the European Union. The European Community represented integration prior to 1993, when it was absorbed into the newly created European Union, where it continues to exist. To avoid confusion, I only use European Community in reference to European integration in the pre-EU time period.

The Eastonian Model of Public Support for European Integration The Eastonian Model To understand the relationship between the economic consequences of European integration and support for European integration, I adopt an Eastonian model of public support (Easton 1965, 1975). According to this model, citizens’ attitudes toward integration consist of two dimensions: utilitarian (specific) and affective (diffuse). According to Easton, utilitarian support: Page 17 → … is directed towards the political authorities and authoritative institutions. It assumes that members have sufficient political awareness to be able to associate satisfaction and dissatisfaction with the perceived behavior of these authorities, whether the behavior is in the form of identifiable actions or some attributable general performance. […] Finally, this kind of support varies with perceived benefits or satisfactions. When these decline or cease, support will do likewise. (Easton 1975, 439) Thus, utilitarian evaluations represent a potentially unstable source of support for governing institutions. Affective support represents an allegiance, attachment, or loyalty to governing institutions and policies that may develop as a result of protracted positive utilitarian evaluations. According to Easton, “it consists of a reservoir of favorable attitudes or good will that helps members to accept or to tolerate outputs to which they are opposed or the effects of which they see as damaging to their wants” (1975, 444). In contrast to utilitarian support, affective support is resistant to temporary shifts in institutional performance, providing a stable environment for governance. Strong affective support dilutes the impact of utilitarian appraisals on support for governing institutions. Widespread affective support provides a source of “political capital” for governing institutions, which can be used to confer legitimacy on unpopular decisions.1 Consequently, widespread affective support is essential to long-term political stability (Almond and Verba 1963). These two dimensions of support are interlinked. According to Easton, affective support derives from socialization and from accumulated positive utilitarian appraisals of governance (Easton 1975, 445, 448). And while affective attitudes are generally stable over time, “if discontent with performance continues over a long enough time, it may gradually erode even the strongest underlying bond of attachment” (Easton 1975, 445). Thus, utilitarian evaluations also have an indirect influence on support for integration through their impact on affective allegiances. This conception of political support is not unique to Easton (1965, 1975). Fiorina (1981) proposed a very similar theoretical explanation for variation in partisan support. According to Fiorina, a citizen's support for a political party reflects her political socialization and a running tally of her retrospective evaluations of the party's performance. As positive partisan evaluations accumulate, a citizen's identification with and support for that party becomes stronger and more immune to short-term changes in the party's performance. But even strong party identification can eventually erode due to perceived poor performance by the party. Page 18 → The Eastonian Model in the EU Context Translated into the context of European integration, the Eastonian model posits that citizens’ support for integration derives from their allegiance to supranational governance and their evaluations of the perceived benefits and performance of that governance. Since EU governance predominantly concerns economic integration, citizens’ appraisals of economic integration should dominate these utilitarian evaluations. This provides a connection between economic integration and public support for integration. Previous efforts to use this model of public support for integration have produced dubious results. In an early study, Lindberg and Scheingold (1970) found that levels of affective support were sufficiently high to provide a “permissive consensus” in favor of integration. They concluded that “national and (European) Community

decision-makers can expect to operate relatively freely without encountering significant opposition” (Lindberg and Scheingold 1970, 121). More recent studies (Inglehart, Rabier, and Reif 1991; Slater 1983, 74; Shephard 1975) have confirmed a pervasive and stable level of affective support for European integration.2 However, the relevance of these findings for understanding public support for integration is dubious. Recent public opposition to the Maastricht Treaty casts doubt on the existence of a public “permissive consensus” in favor of European integration. Why is there a discrepancy between the conclusions drawn from survey evidence and actual public behavior? The answer may be that prior survey evidence was inaccurate. Previous studies never verified that the survey questions they used to evaluate affective and utilitarian support actually measured these dimensions. Alternatively, the studies may have been theoretically misguided. Previous research has not shown empirically that the Eastonian model applies to the EU context.3 Previous studies have not established that citizens have distinct affective and utilitarian components to their attitudes toward integration. Also, they have not demonstrated that these components interact in accordance with the theory. Another potential problem is that previous studies have assumed, but not shown, that these components directly relate to support for integration. For example, some studies assumed that affective (diffuse) support is equivalent to support for integration. A similar assumption is often made in judicial research concerning the relationship between diffuse support, as indicative of legitimacy, and compliance with court decisions (Gibson and Caldeira 1995, 460). In the judicial context, this assumption has not fared well under empirical scrutiny. This suggests that one should be cautious in imputing behavior or other attitudes from affective sentiments.4 And as recent evidence of public opposition to the integration suggests, this link Page 19 → between affective support and behavior may be dubious in the EU context as well. In sum, the applicability of the Eastonian model to the context of European integration remains an empirical question. In the following section, I examine the applicability of the model in two parts. First, I use confirmatory factor analysis to test whether utilitarian and affective dimensions underlie citizens’ attitudes concerning European integration. Second, I will evaluate the relevance of these two dimensions for understanding variation in citizens’ support for actual integration.

Evaluating the Eastonian Model of Public Support for Integration Does the Eastonian Model Account for Public Attitudes Toward Integration? To evaluate whether the Eastonian model accounts for public attitudes toward integration, I use a confirmatory factor analysis of Eurobarometer survey data.5 Factor analysis examines how covariation among variables is structured by latent or underlying factors. Confirmatory factor analysis evaluates the performance of a particular factor structure in explaining the covariation among particular variables designated as “indicators” of these factors. The factor structure consists of the number of factors, their interrelationship, and their relationships to the indicators. The performance of the factor structure is evaluated through a measurement model that assesses the fit of this structure with the data. The Eastonian conception of public attitudes toward integration posits the following factor structure: a latent utilitarian and a latent affective dimension that are positively interrelated, since sustained positive/ negative utilitarian support should promote/erode affective support.6 To test this hypothesis, I specify a measurement model using survey questions pertaining to affective and utilitarian aspects of European integration as indicators of these dimensions. Note that in this analysis I am not investigating whether or not these dimensions are related to support for integration. I address that question in the following section. Data

To assess the Eastonian model, I sought survey questions that, based on face validity, concerned utilitarian and affective aspects of integration. Ideally, one would like to assess the model in various years. Unfortunately,

appropriate survey questions are available only in the October 1985 Eurobarometer. This survey was conducted in all of the EU member Page 20 → states at that time. The questions included in the analysis are presented in tables 1 and 2.7 The means, variances, and covariances of the variables are displayed in appendix A. Since utilitarian support reflects an evaluation of the perceived benefits of integration, I expect utilitarian attitudes to structure variation in responses to the questions National Benefit and Evaluation of Membership. Both of these questions ask respondents explicitly to evaluate membership in the European Community (the precursor to the European Union) and current stage of integration at the time of the survey. Responses to these questions should therefore represent tangible appraisals of integration and be generated by the latent utilitarian dimension of a citizen's attitudes toward integration. Affective attitudes are more difficult to measure directly with survey questions than utilitarian attitudes. Affective support is abstract and broad in nature, representing a general orientation toward integration that should express itself in responses to a variety of questions. The questions European Identity and Solidarity are two questions that, based on their face validity, are expected to tap this affective dimension. The question European Identity asks specifically about citizens’ European identification. Page 21 → The question Solidarity measures respondents’ solidarity with EC citizens outside their own country: their willingness to forgo utilitarian benefits for the sake of other EC members. Thus, these questions capture respondents’ political identification with the European Community. I expect variation in responses to both of these questions to be generated by the affective dimension of a citizen's attitudes toward integration. TABLE 1. Utilitarian Survey Questions Evaluation of membership: Generally speaking, do you think that (your country's) membership of the European Community [common market] is … Response: good thing (1); neither good nor bad (2); bad thing (3) National Benefit: Taking everything into consideration, would you say that (your country) has on balance benefited or not from being a member of the EC [common market]? Response: benefited (1); don't know (1.5); not benefited (2) TABLE 2. Affective Survey Questions European identity: Do you ever think of yourself not only as a [nationality] citizen but also as a citizen of Europe? Response: often (1); sometimes (2); never (3) Solidarity: Are you, personally, prepared to make some personal sacrifice, for example, paying a little more taxes, to help another country in the EC experiencing economic difficulties? Response: prepared (1); don't know (1.5); not prepared (2) European unification: In general, are you for or against efforts being made to unify Western Europe? Response: very much for (1); to some extent for (2); don't know (2.5); to some extent against (3); very much against (4) The question European Unification is included in the analysis because previous research has used it as a measure of affective support (e.g., Ingle-hart, Rabier, and Reif 1991, 14). However, I am not convinced that responses to this question are exclusively determined by global affective orientations because the wording of this question is ambiguous. Depending on how respondents conceive of the “Unification of Western Europe,” utilitarian concerns might influence their responses to this question. For example, a respondent who sees integration as purely economic and who has no allegiance to the European Union might be strongly in favor of further integration because she benefits from economic integration. Thus, the vagueness of this question suggests that it may load on both utilitarian and affective dimensions. Analysis

I examine the Eastonian model of public support by evaluating two different measurement models using maximum likelihood estimation.8 As a baseline for comparison, the first model tests an alternative explanation for public attitudes toward integration. Citizens may hold a general pro-or anti-integration orientation that determines their responses to all of these survey questions. If this is true, then one factor should sufficiently account for the covariation among the indicators and all of the indicators should be positively correlated with that single factor. Model 1 in table 3 presents the results from a test of this single-factor measurement model. The results of this measurement model indicate that one factor does not sufficiently explain the covariation among the five survey questions. The standardized coefficients, which give the epistemic correlation between the latent factor and the observed indicator, indicate that, as hypothesized, the variables are all positively related to a single dimension. However, as indicated by the goodness-of-fit measure, a single-factor model provides a poor fit to the data. To measure goodness of fit, I used the Bentler-Bonnet nonnormed goodness-of-fit index. This index—which ranges from zero to one (perfect fit)—has proven to be among the most reliable and robust measures of model fit (Marsh, Balla, and McDonald 1988; Bentler 1990). Since a score greater than 0.9 denotes acceptable fit, the score of .819 for model 1 clearly indicates that the one-factor model is incapable of explaining the covariation among the indicators. Page 22 → The second hypothesis tested is the two-factor solution from the Eastonian model, as depicted in figure 1 (ignoring the dotted line). Model 2 in table 3 presents the results for this measurement model. The Bentler-Bonnett index score of .983 signifies that the model fits the data well. Also, as hypothesized, the National Benefit and Evaluation of Membership indicators load positively on the utilitarian dimension of factor 1 while the indicators European Identity, Solidarity, and European Unification load positively on the affective dimension of factor 2. The interfactor correlation is also consistent with the Eastonian model, with the utilitarian factor positively related to the affective factor. While the results clearly indicate that a two-factor model is necessary to represent the structure of the indicators, diagnostic information from the analysis suggests that model 2 is still mis-specified. The Lagrange multiplier test, which evaluates the loss in goodness of fit associated with model restrictions, indicates that European Unification is directly related to the utilitarian dimension, factor 1. Thus, the more appropriate measurement model represents European Unification as a function of both utilitarian and affective factors—that is, the factor structure of figure 1 including the dotted line. Model 3 in table 3 presents the results for this measurement model. Compared to model 2, model 3 provides a superior fit to the data. The Bentler-Bonnett nonnormed index score increased from .983 in model 2 to .993 in model 3. In addition, with the more properly specified model, the correlation between the two dimensions shrinks from .708 in model 2 to .608 in model 3. By taking account of the multiple roots of the European Unification item, the two dimensions are now more independent of one another. Page 23 → Thus, the confirmatory factor analysis demonstrates that the Eastonian model accurately characterizes EU citizens’ attitudes on utilitarian and affective aspects of European integration. However, before drawing any conclusions it is important to note that these results are based on a cross-national data set. Given that EU member states have had different experiences with EU membership and may have joined for different reasons, these general results may overlook important national variation in the factor pattern for these indicators. Consequently, I performed the same confirmatory factor analysis on national data sets. I present these results in tables 4, 5, and 6. The results of the national factor analyses demonstrate that the same basic measurement model sufficiently accounts for the covariation among the indicators in all of the member states. Factor 1 consistently represents the utilitarian dimension and factor 2 consistently represents the affective dimension. The robustness of the Eastonian model indicates that EU citizens appear to structure their attitudes toward integration in similar ways, independent of nationality.

It is worth noting that across the national models the item European Unification varies in its relationship to the two dimensions. For instance, this indicator has a significant positive loading on the utilitarian factor in Greece, Denmark, and Belgium. This confirms my prior suspicion that, based on its vague wording, this question would elicit responses that capture some utilitarian attitudes as well as affective sentiments. This ambiguous Page 24 → character of European Unification has important implications for appraising support for integration, which I will discuss later in the chapter. Affective and Utilitarian Attitudes and Support for European Integration The confirmatory factor analysis provided evidence that the structure of citizens’ attitudes toward integration is consistent with the Eastonian model. However, it is yet to be established that the Eastonian model Page 25 → Page 26 → explains public support for integration. If the Eastonian model of public support is correct, citizens’ utilitarian and affective attitudes should be related systematically to their support for actual integrative measures. In this section, I further test the Eastonian model by examining the relationship between these two dimensions and support for actual integrative measures. Based on the Eastonian model, how do utilitarian and affective attitudes relate to support for integration? In a general sense, both types of attitudes should be positively related to support. This has been the basic assumption in previous research (Inglehart, Rabier, and Reif 1991; Hew-stone 1986; Shephard 1975; Lindberg and Scheingold 1970). Previous studies have identified survey questions that, based on face validity, tap either the utilitarian or affective dimension and then have inferred from responses to these questions the level of support for integration. However, if the Eastonian model is accurate, such inferences may be misleading because they ignore the dynamic relationship between these dimensions and support. According to the Eastonian model, the influences of these two dimensions on support for integration are interdependent. Citizens with strong affective European allegiances should provide strong stable support for integration. Utilitarian evaluations should be positively related to support, but this relationship should weaken as a citizen's affective allegiances increase. Thus, a citizen with low affective allegiances could be a strong supporter of integration due to his utilitarian evaluations of integration. Alternatively, a citizen with poor utilitarian evaluations of integration could be a strong supporter due to her affective attitudes toward integration. In the ensuing analysis, I will test whether the Eastonian model accurately explains how these dimensions are related to support for actual integration. First, I will examine whether utilitarian evaluations are increasingly related to support for integration as affective allegiances decrease. Second, I will investigate whether support increases with the strength of supranational affective allegiances. Measuring Support for Integration

To test whether the Eastonian model explains public support for integration, we need survey data that include both measures of affective and utilitarian attitudes toward integration as well as measure of public support for actual integrative measures. Two Eurobarometer surveys meet these criteria: Eurobarometers 30 and 38. Eurobarometer 30 (fall 1988) includes a battery of survey questions regarding proposed integrative reforms. These questions, presented in table 7, were chosen because they all ask for the respondent's opinion on a concrete policy step toward further institutional Page 27 → or policy integration but are not highly detailed in how the policy would be implemented.9 The first three questions concern policy areas that are traditionally considered crucial components of national sovereignty: defense, foreign policy, and currency. The fourth question regards institutional integration toward a supranational parliamentary arrangement that would significantly reform the EU political system. Given the importance of national elites in the policy initiation and decision-making process at the time of this survey, this question represented a move from the largely intergovernmental structure to a more distinctly supranational political arrangement. Thus, these four questions refer to significant integrative reforms. Correlations among these variables are displayed in table 8.10 Note that these variables are discrete and thus allow only a crude

representation of the actual continuum of responses to each question. Consequently, the correlations between these variables are attenuated by the errors in measurement due to the dichotomy of responses. This should be kept in mind when assessing the magnitude of the correlations. The strength of these correlations indicates that EU citizens who were supportive of a particular integrative measure were also supportive of the other proposals. This suggests that respondents have a general pro- or antiintegration orientation that underlies their support for these integrative proposals. To capture a citizen's support for actual European integration, I combined responses to these questions to construct a continuum of support for integrative policies. This index of support, called Support for Integrative Policy, ranges from zero (against all proposals) to four (for all proposals). Page 28 → I will also test the hypotheses with survey data from Eurobarometer 38 (fall 1992). This survey includes a question concerning support for the Maastricht Treaty on European Union. The Maastricht Treaty, officially ratified in 1993, is the most recent reform of EU institutions and policies. Among its most important reforms, the treaty enhances the legislative power of the European Parliament and sets the groundwork for economic and monetary union and a common foreign policy. Thus, the Maastricht Treaty represents a concrete example of European integration including significant institutional and policy integration. The survey question is the following: Support for the Maastricht Treaty: If there were a referendum on whether to agree to the Maastricht Treaty or not, would you vote for (2); against (0); or undecided (1)? Measuring the Utilitarian and Affective Dimensions

I designated survey questions as proxies for the utilitarian and affective dimensions. For the analysis of Eurobarometer 30 data, I use the question Evaluation of Membership as a measure of utilitarian attitudes toward integration.11 This question was the strongest loading variable on the utilitarian dimension in the confirmatory factor analysis. To measure the affective dimension, I use the survey question European Identity. I selected this question because it loaded exclusively on the affective dimension in the factor analysis and the question Solidarity was not available in that survey. For the analysis of Eurobarometer 38 data, I also use Evaluation of Membership as a measure of utilitarian attitudes. Unfortunately, neither Solidarity nor European Identity was asked in Eurobarometer 38. Consequently, Page 29 → I am forced to use European Unification as a proxy for the affective dimension. As discussed earlier, Support for Unification is a “noisy” proxy for affective attitudes because it captures some utilitarian evaluations. However, since this question can divide citizens roughly according to the strength of affective attachments, it is useful in testing the hypothesis. I return to this point in the discussion of the results.

Analysis

I begin by testing the first hypothesis: that utilitarian evaluations have an increasing impact on support for integration as affective allegiances weaken. To test the hypothesis, I divided respondents into two groups for both data sets. The first group consists of those with strong affective attachments. For the respondents of Eurobarometer 30 this group included those who “often” think of themselves as citizens of Europe. For respondents of Eurobarometer 38 this group included those who were “very much” in favor of efforts to unify Western Europe. The second group consists of respondents with weak affective attachments, that is, everyone else. I then estimated the correlation between citizens’ responses to Evaluation of Membership and the proxy for support for actual integration in each group for each survey. Table 9 presents the results of this analysis. For the analysis of Eurobarometer 30, the expectation is that utilitarian evaluations, as measured by Evaluation of Membership, are positively correlated with support for integration, as measured by Support for Integrative Policy.

In addition, this positive correlation should be stronger for those citizens with weak affective attachments than for those with strong affective attachments. The correlations reported to table 9 indicate that, as expected, utilitarian evaluations are positively related to support for integration and this relationship is strongest for those citizens with weak affective European allegiance. This is consistent with the Eastonian model of support for integration. Table 9 also presents the results for the analysis of Eurobarometer 38, which uses Support for the Maastricht Treaty as the proxy for support for Page 30 → integration. These results offer further evidence supporting the Eastonian model. For respondents with strong affective attitudes, the correlation between Evaluation of Membership and Support for the Maastricht Treaty is smaller than for respondents with weak affective attachments. Thus, as affective allegiance attachments decrease, utilitarian evaluations of integration have a stronger relationship with support for integration. I also tested the second hypothesis: that affective allegiances are positively related to support for integration. In testing this hypothesis, it is important to recall that affective attachments are expected to have no impact on support among citizens with positive utilitarian evaluations. Regardless of the level of affective supranational allegiance, those with positive evaluations should express high support for integration. In contrast, when one's utilitarian evaluations are negative, one's level of affective attachment should be positively related to support for integration. For this reason, I examined the relationship between affective allegiance and support for integration only among citizens with negative utilitarian evaluations of integration. Specifically, the analysis only included respondents who, in response to the question Evaluations of Membership, considered membership a “bad thing.” For each data set, I estimated the correlation between affective attachments and support for actual integration as measured by the proxy variables used in the previous analysis. For the Eurobarometer 30 survey, the correlation between European Identity and Support for Integrative Policy was .11 (p < .01).12 For the Eurobarometer 38 data, the correlation between European Unification and Support for the Maastricht Treaty was .32 (p < .01).13 Thus, as expected, the strength of affective attachments is positively related to support for integration. In interpreting the results of these analyses, it is important to note that the use of European Unification as a proxy for the affective dimension is unlikely to have caused misleading results. In the analysis of the first hypothesis, the use of European Unification as a measure of affective attachments probably serves to underestimate the influence of affective attachments on these correlations between Evaluation of Membership and Support for the Maastricht Treaty. Because European Unification potentially incorporates some utilitarian concerns, there may be some respondents in the “strong affective” group who actually have weak affective attachments.14 To the extent this is true, the correlation between Evaluation of Membership and Support for the Maastricht Treaty for the “strong affective” group should be overestimated. In other words, any bias due to the use of European Unification to measure affective attitudes should tend to make the correlations for “weak” and “strong” affective respondents appear more similar than they actually are. In turn, this underestimates the Page 31 → impact of affective attachments on the relationship between utilitarian evaluations and support for integration. Thus, given that the correlation for the weak group is twice as big as the correlation for the strong group, the results for the Maastricht analysis offer particularly strong evidence in support of the Eastonian model. In the test of the second hypothesis, the danger was that European Unification might reflect utilitarian evaluations. If so, one would mistakenly attribute a positive relationship between European Unification and Support for the Maastricht Treaty to affective sentiments instead of utilitarian evaluations. However, since the analysis only included respondents who expressed poor utilitarian evaluations, it is unlikely that any positive response to European Unification was indicative of positive utilitarian attitudes. In sum, the results of both analyses indicate that the affective and utilitarian dimensions are related to support for integration in a manner consistent with the Eastonian model. Utilitarian evaluations and affective allegiances are positively related to support for integration. Also, utilitarian evaluations are increasingly related to support for integration as affective supranational allegiances weaken. The evidence is particularly strong because it is derived from analyses of two separate surveys and two different measures of support for actual European integration.

Reappraising Affect-Based Legitimacy for the European Union The previous analyses have important implications for evaluating the extent of affective (diffuse) support for European integration. Affective support—represented by political allegiances to the European Union and a sense of mutual obligation—is a fundamental indicator of the extent of European integration and of legitimacy for supranational governance. Traditionally, scholars have used the survey question European Unification as a measure of affective support (Inglehart, Rabier, and Reif 1991). The methodological advantage of this question is that it has been asked consistently over a long time period. However, the confirmatory factor analysis demonstrated that there is an important methodological disadvantage in using European Unification to measure affective support. While European Unification is strongly related to the affective dimension, it is also related to the utilitarian dimension. Responses to European Unification are thus “noisy” measures of affective support. A similar response to European Unification could come from both a citizen with strong affective support and a citizen with moderate or weak affective support but strong utilitarian support. Thus, conclusions about the extent of affective support for Page 32 → integration that were based on survey responses to European Unification are potentially misleading. In particular, a common conclusion in prior research on integration was that, based on responses to European Unification, the EU public provides a “permissive consensus” for further integration (Inglehart, Rabier, and Reif 1991; Slater 1983; Lindberg and Scheingold 1970). Given the potential problems with the question European Unification, I will reconsider this claim with more appropriate measures of affective support: the survey questions European Identity and Solidarity. The confirmatory factor analysis indicates that, in contrast to European Unification, these two questions are exclusively related to the affective dimension. Consequently, responses to these questions are better measures of affective support than European Unification.15 Table 10 provides a comparison of the national percentage of positive responses to European Identity, Solidarity, and European Unification in Eurobarometer 25 (fall 1985).16 Across nations, variation in positive responses to these questions follows a similar pattern. Nations with a relatively high level of positive responses for one question tend to have relatively high levels of positive responses on the other questions. Thus, these questions appear to trace out similar trends in cross-national variation in affective support. More importantly, for each nation there is a similar pattern in responses across questions. Specifically, the percentage of positive responses is dramatically higher for European Unification than for European Identity and Solidarity. When asked about their sense of EU citizenship, less than one-fifth of the respondents indicated that they often think of themselves as a citizen of Europe.17 For the question Solidarity, only about two-fifths of respondents were prepared to make a personal sacrifice to help another EU member state experiencing economic difficulties. In contrast, there was a much higher level of positive responses to European Unification. Previous studies, when evaluating the level of affective support, generally used the combined percentage of respondents who were “somewhat” or “very much” in favor of further efforts to unify Western Europe (e.g., Inglehart, Rabier, and Reif 1991). Seventy-five percent of respondents fall in one of these two categories. The obvious conclusion to draw from these data is that European Unification gives a dramatically inflated appraisal of the pervasiveness of affective support for integration. These results contrast significantly with previous studies of public attitudes toward integration. Over twenty years ago, Lindberg and Scheingold (1970) identified an affect-based “permissive consensus” in support of integration. More recent studies have confirmed the existence of pervasive and stable affective support. In contrast, this analysis indicates that a public Page 33 → legitimacy for the European Union, grounded in widespread affective attachments, did not exist well before the recent public opposition to the Maastricht Treaty. Using an appropriate measure of affective support, only about one-fifth of the EU public expressed strong affective sentiments in 1985 (see table 10). Furthermore, this low level of affective sentiments appears to be stable over time. Figure 2 plots, from 1985 through 1991, the percentage of EU respondents who “often think of themselves as a citizen of Europe.” Over this time period, this portion of the public never exceeded twenty percent. The consistently low level of affective attachment hardly signifies a “permissive consensus.” It is also worth noting that, as shown in figure 2, the percentage of citizens expressing strong affective attachments

appears to vary only a small amount over time, remaining between ten and twenty percent.18 This is consistent with the Eastonian model, which characterizes affective sentiments as generally stable over time. Of course a more direct test of this would require panel data tracking individual respondents’ affective support over time. These data are not available. These results also have implications for evaluating the progress of European integration. One of the principal goals of economic integration was to promote a public integration whereby citizens’ national political loyalties would develop into supranational allegiances. The evidence presented here indicates that few citizens express a strong supranational identity. Page 34 → Apparently, economic integration is yet to promote a public integration.

Conclusion This chapter has demonstrated the applicability of the Eastonian model of public support to the EU context. The confirmatory factor analysis provided statistical evidence that EU citizens’ attitudes are characterized by affective and utilitarian dimensions that are positively interrelated. Based on the factor analysis I identified survey questions that measure these two dimensions. I then used these survey questions to evaluate the extent of affective support for the European Union and to show that the utilitarian and affective dimensions are related to support for integration in systematic ways. Specifically, I demonstrated that, consistent with the theory, utilitarian evaluations of integration and affective supranational allegiances are positively related to support for integration. Furthermore, utilitarian evaluations are increasingly influential on support for integration as affective allegiances decline. Page 35 → What does the Eastonian model tell us about public attitudes toward integration? The analysis indicates that past evidence regarding affective attitudes is misleading. Accurate measures of affective attitudes do not corroborate the prior conclusion that EU citizens provide a “permissive consensus” supporting integration. Only about onefifth of the EU public expressed strong affective sentiments, and this fraction seems to remain stable over time. This indicates that the EU governing institutions lack a public legitimacy, which could serve to buttress the authority of these institutions during periods of public discontent with EU governance. The low level of affective allegiances also demonstrates that the public integration sought by those who instigated economic integration has not materialized. In spite of remarkable economic and policy integration in Europe, only a small portion of EU citizens think of themselves as European citizens. Finally, the evidence from this chapter has important implications for the central focus of this book: how the economic consequences of integration relate to support for integration. Due to the low level of affective support, the results indicate that utilitarian evaluations are an important determinant of support for integration for the vast majority of citizens. Consequently, understanding why citizens vary in their utilitarian evaluations of integration is crucial to explaining and predicting why citizens differ in their support for integration. This provides a link between the economic consequences of integration and support for integration. Since the primary function of the EU institutions has been economic—to complete and administer the internal market—it seems plausible that citizens’ utilitarian evaluations of the European Union would reflect the EU's economic consequences. The following chapters address this issue.

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CHAPTER 3 Market Liberalization, Economic Interests, and Public Support for European Integration The survey evidence in chapter 2 supported two important conclusions concerning public support for European integration. First, a citizen's level of support for integration derives from two sources: her affective supranational allegiance and her utilitarian evaluation of integration. Support increases with both improvements in utilitarian evaluations and growth in affective allegiance. Furthermore, utilitarian evaluations increasingly influence support as affective allegiances weaken. Thus, utilitarian evaluations have their greatest effect on support for citizens with little or no affective supranational allegiance. Second, the results show that most citizens in the European Union lack strong affective supranational allegiances. This low level of public affective attachments appears to be stable over time. In combination, these two conclusions imply that utilitarian evaluations of integration are an important influence on most EU citizens’ support for integration. Consequently, to understand variation in support for integration we need to explain why citizens differ in their utilitarian evaluations of integration. Why do EU citizens differ in their utilitarian evaluations of integration? In the next three chapters I develop an answer to this question. Put simply, I contend that citizens base their utilitarian evaluations on the welfare they derive from economic integration. European integration has been primarily an economic enterprise, focusing on the implementation of policies that create and maintain a single market: the free movement of goods, capital, labor, and services among the EU member states. In evaluating the performance and perceived benefits from EU membership, I expect citizens to focus on the consequences of these economic policies. In this chapter, I develop this argument and test several hypotheses regarding how the economic consequences of integrative policy relate to utilitarian support for integration. Page 38 →

Economic Integration and Utilitarian Support for European Integration Economics and Utilitarian Support for Integration Eichenberg and Dalton (1993) and Dalton and Eichenberg (1991) provide the only theoretical models of utilitarian sources of variation in public support for integration. Both studies hypothesized that citizens of the European Community (EC)—subsequently the European Union (EU)—credit (blame) EC bureaucrats and politicians when economic conditions are good (bad). Dalton and Eichenberg (1991) tested whether citizens’ perceptions of their personal and national economic situations were related to their support for integration. They found that national averages of citizens’ evaluations of their personal and national economic situation (prospective and retrospective) were positively related to support for integration. The substantive significance of these relationships, however, was small.1 Eichenberg and Dalton (1993) examined whether objective macroeconomic conditions were related to nationallevel variation in support for integration. They found only limited evidence in support of this hypothesis. Among macroeconomic factors (GNP, inflation, and unemployment) only inflation was related to national-level variation in support. They also found that a nation's level of intra-EC trade was positively related to support and that a nation's net fiscal benefit from EC policy was not related to support. In sum, these studies found mixed evidence that objective and perceived economic conditions influence citizens’ evaluations of integration. I contend that national economic conditions are not the only concerns that influence citizens’ utilitarian evaluations of integration. Eurobarometer survey evidence suggests that most EU citizens do not hold the European Union accountable for national economic performance. When asked to name the major cause of their country's current economic problems, 39 percent cited worldwide recession, 23.4 percent blamed domestic developments, and 16.4 percent mentioned American economic policies.2 Only 12.3 percent blamed EC economic

policies. Given this fact, the limited empirical support for Dalton and Eichenberg's hypotheses is not surprising. National and personal economic concerns may influence only a small number of citizens’ attitudes toward integration. Instead, I contend that citizens’ utilitarian assessments of integration are more sophisticated. Rather than merely checking the economic thermometer and adjusting their opinions of integration accordingly, I posit that EU citizens base their utilitarian support for integration on the consequences of economic integration. Individuals in different national and Page 39 → socioeconomic situations experience different costs and benefits from integrative policy. I expect citizens’ utilitarian appraisals of integration to relate positively to these differences in welfare derived from economic integration. I refer to this as the policy appraisal model. Note the difference between this proposition and the economic voting models proposed by Eichenberg and Dalton. In their models, the policy implications of European integration are only influential on public opinion insofar as they shape the general economic environment and personal economic perceptions of the economy. In contrast, the policy appraisal model contends that citizens’ evaluations of integration respond directly to integrative policy, regardless of general economic conditions. To appreciate this distinction, consider a scenario in which trade liberalization—a major component of European integration—creates national economic growth and employment. In this case, both models predict increased public support. I would expect citizens to evaluate EU membership positively due to its commercial benefit while Dalton and Eichenberg would expect public support for integration to increase as a result of improved economic conditions. Now, add to this scenario an oil embargo that causes rampant inflation, economic downturn, and unemployment. In this case the economic voting model would predict declining public support due to worsening macroeconomic conditions. My model predicts that public evaluations of integration would continue to reflect the trade benefits of EU policy (trade liberalization), in spite of economic downturn. While this example serves to distinguish the models, they are not mutually exclusive. Certainly a complete model of utilitarian evaluations of integration could include citizens’ appraisals of their economic situation, both personal and national. I will address the combined effect of these two models in chapter 6. The Policy Appraisal Model The policy appraisal model is based on two assumptions that deserve further discussion. First, I assume that citizens evaluate European integration and EU governance based on the ramifications of economic integration. I make this assumption because the primary focus of European integration and the vast majority of its tangible consequences for citizens have been economic. The initial steps toward European integration were explicitly economic in nature. The purpose of the European Community (EC)—the European Coal and Steel Community, EURATOM, and the European Economic Community—was to create a single economic market for the EC member states. The European Community has specific responsibilities concerning the production and use of agricultural products, atomic Page 40 → energy, coal, and steel. But the primary responsibility of the European Community was to create and manage a liberalized market for goods, services, capital, and labor with a common external tariff—that is, an internal market. The internal market remains the principal achievement of European integration and the primary focus of EU governance. Subsequent revisions of the Economic Community maintained this economic focus. The Single European Act (SEA) of 1987 was primarily designed to accelerate the completion of the internal market. The SEA introduced institutional reforms explicitly to facilitate decision making on policies concerning the establishment and functioning of the internal market. The Treaty on European Union (TEU) of 1993 provided the first major noneconomic integrative steps. The TEU is based on three pillars: the European Community, a Common Foreign and Security Policy, and Cooperation in the Fields of Justice and Home Affairs. However, the EC remains the most important pillar, accounting for most of the EU's policy responsibilities. The TEU also revised the European Community to include provisions for the creation of the Economic and Monetary Union (EMU), consisting of a common currency controlled by an independent EU monetary authority.

This is not to say that European integration has exclusively concerned economics. Clearly, EU authority governs a variety of policy areas that are not explicitly economic in nature—for example, environmental policy. However, the primary obligation of EU membership is adherence to EU policy governing the internal market. These policies required national economic adjustments that introduce new opportunities, competition, and uncertainty for citizens depending on their personal economic assets. Thus, in evaluating integration, it seems plausible that citizens’ utilitarian appraisals reflect the consequences of economic integration. It is important to note that EU citizens are generally uninformed and unconcerned about European integration and EU politics.3 Thus, the policy appraisal model requires a second assumption: that EU citizens form these utilitarian appraisals without a sophisticated understanding of EU governance or integrative policy. How can uninformed citizens make utilitarian evaluations of integration that reflect their self-interest? Recent research based on “rational ignorance” offers an answer (e.g., McKelvey 1985; Popkin 1994). As Downs (1957) originally argued, a rational voter does not incur the cost of obtaining a sophisticated understanding of policies because the likely impact of her informed opinion on political outcomes is very small. However, this does not mean that uninformed citizens cannot form coherent political opinions that are consistent with their personal interests. Citizens can use informational shortcuts and cues from their social environment Page 41 → to infer their likely personal benefits from particular policies and candidates (e.g., Lupia 1994; Popkin 1994; Page and Shapiro 1992; Sniderman, Brody, and Tetlock 1991; Conover and Feldman 1989; McKelvey 1985; Calvert 1985; but see Bartels 1996). Like-minded fellow citizens and elites—for example, politicians, journalists, and union leaders—provide citizens with cues regarding how policies influence their personal welfare. Citizens can also use easily accessible information from the media and interest groups. These information sources often condense complicated issues into simple messages that an uninformed citizen can understand. By using these information shortcuts, uninformed citizens can adopt political attitudes that appear informed and that reflect their interests. Some scholars have asserted that this reliance on elite messages renders public opinion irrelevant. If citizens simply echo the opinions of the informed elite, the argument goes, then public opinion becomes meaningless for policy-making because it is completely endogenous to the opinions of the elites who formulate policy (Ginsburg 1986; and see Kuklinski and Segura 1995, 8). However, this argument rests on a dubious assumption: that citizens simply mimic the elite attitudes available in their informational environment. Citizens are not bound to echo elite attitudes. They can respond to the same cue in different ways depending on their self-interest and political predispositions. As Kuklinski and Hearly argue, when political statements are made in a social context and concern real-world issues, people focus on the pragmatic meaning of the statements, that is, why they were said and not their semantic meaning alone. And the characteristics of the political source influence the pragmatic meaning that people assign. (1994, 748) In other words, citizens can infer their personal benefits from a particular policy by interpreting and selecting messages in their informational environment based on their own personal preferences (Huckfeldt et al. 1995, 1026). To illustrate this, consider the following scenario. The government is considering a new labor policy that will influence union laborers’ wages and shareholders’ dividends. Both shareholders and workers are uninformed about the policy and uncertain about how the policy will influence their interests. They then learn that a probusiness politician publicly endorsed this policy. Based on this endorsement, workers and shareholders are likely to form very different opinions about their likely benefits from that policy. Returning to the policy appraisal model, the preceding discussion provides an explanation for how uninformed citizens can adopt evaluations of integration that reflect their benefits from economic integration. Page 42 → Furthermore, it is important to note that the structure of social and political affiliations among EU citizens facilitates information transmission regarding economic interests. Economic interest is an important basis for political identification among EU citizens (Dalton 1996, 170). Economic interest is also a strong determinant of citizens’ social affiliations—for example, social clubs, private schools, unions, and class-based neighborhoods. Thus, EU citizens are frequently exposed to information from political parties, coworkers, neighbors, and elites

who share their economic interests. The following discussion and analysis examine whether citizens do actually form attitudes toward integration that reflect their self-interest. Based on the policy appraisal model, I specify and test several hypotheses that relate differences in the economic consequences of European integration with variation in utilitarian support for integration. Specifically, I investigate how integrative policy differentially benefits EU citizens according to their socioeconomic situation.

Socioeconomic Differences in the Benefits of EU Market Liberalization The EU's economic mission, as described in the Treaty of Rome in 1957, was to eliminate all barriers to the movement of goods, capital, labor, and services (Article 3, Treaty Instituting the European Economic Community). European integration has grown to include coordinated monetary policy through the European Monetary System (EMS) and a potential Economic and Monetary Union. These policies demand national economic adjustments that provide new opportunities, competition, and uncertainty for EU citizens depending on their personal economic assets and socioeconomic situation (Eichengreen and Frieden 1994, 13). I discuss the differential personal economic implications of these policies in the following sections. Labor Market Liberalization Pursuing the goals of the Treaty of Rome, the European Union has gradually dismantled many barriers to the movement of labor across member states. In principle, the Treaty of Rome prohibited discrimination based on nationality in hiring, wages, and other work conditions for all EU citizens. However, the Treaty allowed several exceptions to this rule. The Treaty protected jobs in the public sector and permitted national discrimination for reasons of public order, public security, or public health (Article 48). These exceptions in combination with the considerable size of the Page 43 → public sector in many EU member states significantly limited the liberalization of the labor market. Subsequent EU legislation and judicial rulings have significantly reduced the scope of these exceptions. The European Court of Justice (ECJ) has interpreted the exclusion of the public sector in a restrictive sense, permitting discrimination only for public sector jobs involving public security and authority.4 In addition, 1964 EC legislation and several rulings by the European Court of Justice reduced the acceptable conditions under which public order or security could justify discrimination.5 1988 EC legislation provided for reciprocal recognition of degrees and certifications—a technical barrier that constituted a significant limitation on access to professional occupations (Guery 1991, 111).6 In short, the process of European integration includes a progressive liberalization of the labor market toward the complete elimination of employment discrimination based on nationality.7 The Benefits and Costs of Labor Market Liberalization

The liberalization of the EU labor markets affects citizens differently according to their level of education and of occupational skills. Education and experience in skilled occupations are advantageous in an advanced industrial economy. Becker (1980) has shown that the accumulation of “human capital” through education and training increases one's earnings and decreases one's risk of unemployment. Poorly educated and unskilled citizens have less valuable and mutable skills, and they are thus more expendable in times of economic downturn than welleducated and skilled citizens. Human capital is a strong indicator of a citizen's ability to adapt to a liberalized EU labor market. EU labor market liberalization disrupts traditional national labor markets by introducing EU-wide competition for jobs. Domestic firms can employ foreign workers, and domestic workers can compete for jobs in foreign firms. Human capital is an important determinant of one's ability to adapt to these conditions (Tsoukalis 1993, 230). EU citizens with high education levels and occupational skills are better prepared to apply their talents in diverse international settings and to adapt to economic changes in their production sector and region. Given the importance of human capital for earnings and employment, I expect well-educated EU citizens in

professional and management positions to be more optimistic about job opportunities created by an EU labor market and less fearful of unemployment resulting from greater competition than poorly educated manual workers. There is evidence that EU citizens perceive integration in these terms. As table 11 indicates, low-skilled citizens are less optimistic about their employment prospects resulting from integration than highly skilled citizens. In a 1987 survey more Page 44 → professionals than manual workers stated that a single European market will create job opportunities and more manual workers than professionals identified competition-related unemployment as the most striking development of integration. In short, labor market liberalization has clear utilitarian implications for citizens depending on their level of human capital. I expect this to be reflected in utilitarian evaluations of European integration. Citizens with high education and skilled occupations should be more supportive of European integration than poorly educated and unskilled EU citizens. I refer to this as the human capital hypothesis. Capital Market Liberalization The Treaty of Rome (Article 67) calls for the progressive elimination of barriers to the movement of capital between EU members and of discriminatory Page 45 → policies based on nationality. The original intent of this provision was vague, restricting capital liberalization to the functions of the common market (Dutheil de la Rochere 1991, 12). Further legislation was necessary to define the extent of this liberalization. A 1962 directive from the Commission designated three categories of capital movements and specified the degree of required liberalization for each category. The first category required complete liberalization of capital movements for foreign direct investment, credits for trade, personal savings, and stock market transactions. In the second, national controls could be implemented conditionally on medium- and long-term credit and securities issued by national firms. For the third category, governments could unconditionally limit deposits and short-term credit and securities (Dutheil de la Rochere 1991, 14). To varying degrees, the EU members have surpassed these standards. By 1983, Germany, Belgium, Luxembourg, and the United Kingdom had eliminated all restrictions on capital movement, and the Netherlands had eliminated all but the last category of restrictions. By 1988, only Greece, Ireland, Portugal, and Spain maintained recourse to the conditional capital controls in category two, and this recourse was only temporarily granted by the Commission.8 The discussion of capital liberalization would be incomplete without addressing cooperation in monetary policy. Since the formation of the European Monetary System (EMS) in 1979, a quasi-fixed exchangerate system has effectively coordinated monetary policies among the EU members. The two major goals of the EMS are to facilitate trade within the European Union and to coordinate economic policy among the EU members. To achieve these goals, the Exchange Rate Mechanism (ERM) of the EMS requires its members to maintain currency parities with the German mark, thus harmonizing EU members’ monetary policy toward German policy. The general impact of the EMS on national macroeconomic policy has been a convergence of national interest rates and inflation rates in the European Union (Tsoukalis 1993, 190). This is true for all EU members, even those who have not chosen to participate in the ERM. More recently, plans have been made to further coordinate EU members’ economic policies. The Treaty on European Union of 1993 provides for an Economic and Monetary Union, with the complete elimination of all capital controls throughout the European Union. EMU also includes the development of the EMS into a fixed exchange rate system, the eventual replacement of all national currencies with a single EU currency, and the creation of an independent EU central bank. Page 46 → The Benefits and Costs from Capital Liberalization and EMU

The liberalization of capital markets and the movement toward Economic and Monetary Union have differential

impacts on EU citizens depending on their income level. Wealthy EU citizens are more likely to benefit from capital liberalization since they can exploit the greater investment opportunities provided by more open financial markets (Frieden 1991, 434). In addition, the EMS provides a general benefit to holders of financial assets: low inflation. Germany is the de facto leader of the ERM, setting the monetary policy that other members must follow. Due to the anti-inflationary bias of German monetary policy, membership in the ERM requires low domestic inflation so as to maintain exchange-rate parities. In general, this anti-inflationary bias has also been present in non-ERM member states. Nonmembers (e.g., Italy, the United Kingdom, and Portugal) have tended to adjust to German monetary policy in preparation for future entry into the ERM. Consequently, inflation rates of all EU members (and even some adjacent non-EU members) have converged toward German rates since the EMS's creation in 1979 (Tsoukalis 1989). This anti-inflationary bias represents a benefit for citizens holding capital assets, since the value of financial assets is inversely related to inflation. In contrast, EU citizens with low incomes are generally hurt by capital liberalization. Low income citizens are dependent upon social welfare programs that are constrained by capital mobility and the EMS. Capital mobility imposes constraints on government welfare spending. As the “structural dependence” thesis argues, the ability of businesses and investors in a common market to move their capital to the most lucrative location creates an atmosphere of competition among the EU member governments to limit taxes (and the social spending they finance) so as to retain and attract investment and industry (Przeworski and Wallerstein 1988; Swank 1993). For example, in 1993 Hoover moved its vacuum cleaning production plant from Dijon, France, to Glasgow, Scotland, because of fiscal incentives from the British government and lower taxes.9 This works to the disadvantage of lowincome citizens who depend on these government-financed social programs. The interests of low-income citizens are also harmed by the EMS. The anti-inflationary bias of the EMS limits spending on social welfare programs by constraining its members’ fiscal policies. The experience of France in the ERM illustrates this fiscal constraint (see Petit 1989; Hall 1986). After coming to power in 1981, the French Left embarked on a dramatic expansion of the welfare state. The government nationalized banks and industries, increased the minimum wage by 25 percent, augmented pensions and family allowances, and shortened the workweek. By 1983, Page 47 → however, these policies had caused inflationary pressures that forced three devaluations of the franc. To keep the franc in the EMS, the French government was forced to alter dramatically its economic policies, especially its fiscal policy. The French government reduced social security benefits, introduced more regressive forms of taxation, and froze wages (Hall 1987, 58). This austerity package had significant adverse consequences for low-income citizens. In sum, capital liberalization has different utilitarian implications for EU citizens depending on their level of income. Wealthy citizens benefit from increased investment opportunities and low inflation. The poor are adversely affected by constrained welfare spending, and they lack the financial resources to exploit the investment opportunities. Consequently, I expect EU citizens’ utilitarian evaluations of integration to be positively related to their level of income. I refer to this as the income hypothesis. Trade Liberalization The liberalization of trade between the EU member states is a fundamental component of European integration. In keeping with the provisions of the Treaty of Rome, practically all tariffs were eliminated on trade between the EU members by 1969. However, a number of nontariff barriers proved difficult to remove. These barriers are generally of three sorts: fiscal, technical, and physical. Fiscal barriers to trade include variable tax codes, technical barriers are different standards and specifications, and physical barriers include customs checkpoints. In 1987, the Single European Act provided for the elimination of all such barriers by 1993, and a Commission report identified 300 measures necessary to complete this task. Although legislation has not completely resolved all of these issues, substantial progress has been made in this direction. Costs and Benefits of Trade Liberalization

The liberalization of trade has important ramifications for producers (and their employees) depending on their competitiveness in the EU market (Smith and Wanke 1993). Relatively efficient firms with strong export demand benefit from reduced barriers to trade. In contrast, trade liberalization hurts firms that depend on government subsidies or protectionist policies.10 Thus, depending on which firms benefit from trade liberalization and citizens’ employment and opportunities for employment in these firms, I expect trade liberalization to influence citizens’ utilitarian evaluations of integration. Unfortunately, data regarding occupation that are sufficiently detailed to examine this issue are not available. One related hypothesis, however, can be tested. Trade liberalization Page 48 → also influences citizens differently depending on where they reside. Europeans residing near borders with other EU members benefit more from increased economic interaction—particularly the free movement of goods—between the neighboring countries than non-border residents. In particular, residents of border areas benefit from cross-border shopping. Residents of both sides of the border derive economic benefits from the free movement of goods. Due to differences in sales tax rates, consumers from relatively high-tax nations can exploit the lower tax rates in adjoining nations.11 For example, with the elimination of customs controls, citizens from Denmark, which has a standard Value Added Tax (VAT) rate of 22 percent in 1987, benefited from access to the German market, which had a standard VAT of 14 percent.12 There are also commercial benefits to firms in the relatively low-tax-rate border region. In the preceding example, German merchants situated near the Danish border benefit from the increased Danish consumer demand. Thus, the free movement of goods provides benefits to residents on both sides of the border. A 1993 Price Waterhouse study demonstrated that many Europeans exploit these opportunities for cross-border shopping. For example, the study found that in Luxembourg, which has relatively low excise duties on tobacco products, nonresidents account for 80 percent of total sales of tobacco products (Price Waterhouse 1993, 63). I expect these benefits of proximity to intra-EU borders to influence citizens’ utilitarian appraisals of integration. Specifically, I posit that border residents will express greater utilitarian support for integration than non-border residents. I refer to this as the proximity hypothesis. The Common Agricultural Policy and Benefits from European Integration The Treaty of Rome (Article 36) provided for the creation of a Common Agricultural Policy (CAP). The CAP, which began in 1962, subsidizes agricultural exports, provides development assistance, protects EU produce from foreign competition, and guarantees prices for agricultural products. The cost of this policy makes it the dominant program in the EU budget, consistently consuming the majority of the EU's revenues. The European Union has reformed the CAP several times in order to limit its cost. In 1968, the Mansholt Plan proposed to reduce the number of farmers and improve the efficiency of the agricultural sector. Although this plan generally failed, similar concerns were raised in the early 1980s due to the increasing agricultural surpluses, recurring budgetary problems, and international pressures. This resulted in a 1984 reform of support for dairy products, including taxes on excess production. Other Page 49 → restrictions on support for sugar and cereals followed in 1986 (Herschtel 1993, 98). In 1992 more global and profound reform was introduced to reduce guaranteed prices and limit the amount of EU resources devoted to the CAP (Herschtel 1993, 98). Costs and Benefits from the CAP

The CAP is a typical redistributive policy. The costs of the CAP are spread out across all EU citizens (as consumers and taxpayers), and the benefits are concentrated among farmers. The costs of the CAP for any citizen are relatively small and fairly evenly distributed across citizens, providing no clear variation in utilitarian consequences. In contrast, the benefits of the CAP fall directly on a small group of citizens: farmers. I expect farmers to incorporate the benefits of the CAP into their utilitarian evaluations of integration. Consequently, all else being equal, farmers should express greater utilitarian support than nonfarmers. I refer to this as the CAP hypothesis.

Testing the Policy Appraisal Hypotheses

Data and Methodology To investigate these hypotheses, I have pooled individual-level Eurobarometer survey data from spring 1975 through spring 1992. This data set includes respondents from Belgium, Luxembourg, France, West Germany, the Netherlands, Denmark, Ireland, and the United Kingdom with the addition of Greece in 1981 and Portugal and Spain in 1987. I selected this data for both theoretical and practical reasons. First, the policy appraisal hypotheses specify systematic relationships between individual-level characteristics and utilitarian evaluations that should be common across time and nations. However, any particular response to a survey question designed to measure utilitarian support may incorporate unsystematic components due to idiosyncratic temporal or contextual factors. In testing the hypotheses, one wants to maximize the chance that the evidence reflects the systematic rather than unsystematic factors. Using a large sample, from a variety of temporal and national contexts, reduces the chance that any inferences we draw from the data reflect merely transient or random processes (King, Keohane, and Verba 1994). In practical terms, a large data set is necessary due to multicollinearity (Corlett 1990). Several of the hypotheses identify sources of variation that are highly correlated—for example, education, income, and occupational skills. Consequently, there is little independent variance among these variables from which to estimate their effects on utilitarian evaluations Page 50 → of integration.13 The combination of these surveys maximizes the independent variation from which to draw statistical inferences, enhancing our confidence in the estimated relationships for these variables.14 The time-series is restricted on both ends by data availability. The dependent variable in this analysis is “utilitarian support for integration,” which will be measured by the following question: Evaluation of Membership: Generally speaking, do you think that (your country's) membership in the European Community (Common Market) is a good thing (2), neither good nor bad (1), or a bad thing (0)? I selected this question for two reasons. First, this question was the strongest and most consistent indicator of the utilitarian dimension in the confirmatory factor analyses in chapter 2. Second, this question was asked over a long time-series. This allows me to investigate the aforementioned hypotheses in multiple years. In this analysis, Evaluation of Membership is normalized so that it ranges from 0 (low utilitarian support) to 100 (high utilitarian support). The scale, although not continuous, eases interpretation of the results. The explanatory variables in the analysis are designed to measure EU citizens’ appraisals of integrative policy related to the liberalization of markets for capital, labor, and goods, and the Common Agricultural Policy.15 To test the human capital hypothesis, I constructed occupational dummy variables for manual laborers, unemployed citizens, executives, and professionals. I also constructed dummy variables for four levels of education, based on the age the respondent finished her education.16 The expectation is that respondents who are not obtaining occupational skills—manual laborers and the unemployed—and who have a low level of education will form less favorable utilitarian evaluations of integration than respondents who are gaining occupational skills—executives or professionals—and have a high level of education. To test the income hypothesis, I constructed dummy variables for four levels of income.17 The theoretical expectation is that respondents in higher income quartiles will evaluate integration more favorably than those in lower income quartiles. To test the CAP hypothesis, I constructed a dummy variable for farmers. The expectation is that, ceteris paribus, farmers will evaluate integration more favorably than nonfarmers. To test the proximity hypothesis, I constructed a dummy variable for residents of intra-EU border regions.18 I expect border residents to express greater utilitarian support for integration than non-border residents. Page 51 → Finally, I included several other dummy variables to control for factors that often influence political attitudes: gender, age, residence, and occupation. The reader should note that the dependent variable, Evaluation of Membership, has a mean of 75.5 and a standard

deviation of 36.1. This means that most of the variation across respondents is between about 40 and 100 points. Since each explanatory variable accounts for only a fraction of this variance, the magnitude of the estimated coefficients may appear small relative to the 100-point scale. The reader should keep this in mind when considering the substantive significance of the estimated relationships. I use an ordinary least squares regression of pooled cross-sectional data to test these hypotheses.19 The pooled design has become infamous for its associated methodological problems (see Beck and Katz 1995; Sayrs 1989; Stimson 1985). First, frequently the error terms do not share a common variance—that is, there is heteroskedasticity. In the presence of heteroskedasticity, the estimates of the standard errors for the parameters are unreliable. In response to this problem I estimated White's heteroskedastic-consistent standard errors for the parameters (see Greene 1993, 391; White 1980). These robust standard errors are accurate in large samples, such as the ones analyzed here (Beck 1996). Second, pooled time-series data often fail to meet the assumption of a common intercept across units—in this case, national publics or years. Citizens from different nations or in different years may have different baseline (or intercept) values. Previous research identified a number of theoretical reasons to believe that varying national traditions may influence the baseline values for citizens of particular nations and that important events may influence the baseline for particular years (Eichenberg and Dalton 1993). For example, citizens of Portugal and Spain, both relatively new democracies, may be generally enthusiastic about integration due to perceptions that it legitimizes their democratic transition. World events, national elections, or European Parliament elections may influence attitudes toward integration in particular years. Such fixed effects, if not accounted for, can cause biased and imprecise parameter estimates. To avoid this problem, the statistical model includes dummy variables for each nation and each year.20 These year variables also capture any time trend (time-series) in the errors. It is worth emphasizing that this analysis uses individual-level rather than aggregate-level data. Thus, the time-series problems (i.e., autocorrelation) of pooled models of panel data are not applicable to this statistical design, which pools a series of independent cross-sections. Page 52 → Statistical Results The results of the statistical analysis are presented in table 12.21 I estimated three OLS regression models. Model 1 includes the full sample of respondents from 1975 through 1992 in all member states. Models 2 and 3 examine the robustness of the hypothesized relationships over time. Previous research suggests that these hypotheses may not hold in certain temporal subsamples. As Anderson and Reichert argued, the project of European integration has changed over time (1996, 236). In particular, the Single European Act (SEA) of 1987 revised the agenda for economic integration, modified the institutions of the European Union, and coincided with the accession of Spain and Portugal. By redefining the geographic boundaries, economic goals, and institutional character of the European Union, this event may have altered the way citizens perceived and evaluated European integration. To control for this temporal effect, I estimated a separate model (model 2) for the pre-SEA subsample and a separate model (model 3) for the post-SEA subsample. In all of the models, the baseline respondent is a British male who finished his education between the ages of 14 and 20, whose income falls in the second national quartile (Low-Mid), who resides in a non-border region, and who is employed in a white-collar profession. The baseline year is 1989 in models 1 and 3 and 1986 in model 2. All parameter estimates for the explanatory variables should be interpreted relative to this baseline respondent.22 Focusing first on the human capital hypothesis, the occupation and education parameter estimates are consistent with expectations. Respondents who were receiving skilled occupational experience—professionals and executives—expressed more utilitarian support than those who were not—manual workers and the unemployed. For example, in the full sample (model 1) manual workers and the unemployed expressed on average over eight and half points less utilitarian support than professionals and executives. Turning to education, the results are also consistent with the human capital hypothesis. Citizens with the most years of education expressed more utilitarian

support than those with the lowest level of education. In model 1, the most educated respondents expressed on average over five points more utilitarian support than the least educated respondents. Note that the cumulative impact of human capital on utilitarian support is substantial. A well-educated professional has over 14 points higher utilitarian support for integration than a poorly educated manual laborer has. Since the standard deviation for the dependent variable is 36 points, Page 53 → the total impact of human capital on utilitarian evaluations is substantively large. The results are also consistent with the income, proximity, and CAP hypotheses. In model 1, the wealthiest EU respondents expressed on average 6.51 points more utilitarian support than the poorest respondents. Residents of border regions expressed, on average, 1.45 points greater support Page 54 → than non-border residents. And employment as a farmer was associated with an average increase of 4.81 points in utilitarian support. The evidence from models 2 and 3 demonstrate the robustness of these relationships over time. The parameter estimates from the regressions in both the pre- and post-SEA subsamples are consistent with expectations. The only exception is that, in the post-SEA sample, occupation as a farmer has no statistically significant impact on utilitarian support. One potential reason for this is that the CAP does not distribute benefits uniformly across farmers. As discussed earlier, CAP spending has changed over time and across farmers due to EU enlargement and fiscal reforms. Consequently, it may be misleading to estimate the relationship between the CAP and farmer's evaluations of integration through a dummy variable common to all farmers. I further explore this issue in the next chapter. The adjusted R2 of the regression models is reported as a convention. R2, as a measure of goodness of fit, is largely irrelevant to this analysis. This analysis was designed to estimate the relationship between the explanatory variables and the dependent variable. Consequently, the relevant statistics are the parameter estimates and their standard errors. The analysis was not designed to maximize the amount of variance in Evaluations of Membership accounted for by the explanatory variables, that is, maximize the R2. It is also worth noting that the R2 is likely to underestimate the amount of utilitarian support explained by the model. The dependent variable, Evaluation of Membership, is polychotomous and consequently suffers from some measurement error. Limited response categories necessarily impose some restrictions on how well respondents can express their attitudes, and some respondents may interpret the meaning of the categories slightly differently. This measurement error is harmless to the estimation of parameter coefficients but does tend to deflate the R2 by creating unsystematic variance for which the model cannot account.23 The only serious reason for concern about the low R2 is that it may indicate model mis-specification, in particular an omitted variable problem. That is, potentially confounding variables may have been left out of the analysis. To minimize this possibility, chapter 6 reexamines these policy appraisal hypotheses with control variables for a variety of alternative explanations of support for European integration.

Conclusion In sum, these results show that EU citizens’ utilitarian support varies systematically with their economic benefits from the liberalization of national markets for capital, goods, and labor and their benefits from the Common Page 55 → Agricultural Policy. A simple way to synthesize the findings of this analysis is to consider how integration differentially affects EU citizens based on the degree to which their welfare depends on wages from labor relative to returns on capital. Prior to and during economic integration, many domestic policies in the EU member states attempted to raise wages relative to returns on capital. Through redistributive policies favoring the poor and labor policies mandating worker benefits, governments effectively increased wages at the expense of revenues from capital investment. European integration, I have argued, constrains national governments in pursuing these policies and thus increases returns on capital investment relative to wages.

The results of the regression analyses suggest that citizens respond to these economic ramifications of integration in their utilitarian evaluations of integration. EU citizens who benefit from this constraint on government support for wages relative to returns on capital demonstrate stronger utilitarian support than those citizens who are disadvantaged by this policy change. Specifically, EU citizens possessing greater human and financial capital evaluate integration more positively than citizens poorer in these capital resources. Also, these results provide further evidence for the Eastonian model of public support for European integration. In chapter 2, the survey question Evaluation of Membership was identified as a measure of utilitarian support. The analysis of this chapter supports this characterization of the survey question, as citizens’ responses to this question appear to incorporate their utilitarian concerns about integration. Broader implications of this section's results for the process of integration, the institutional design of the European Union, and theoretical questions related to public opinion will be discussed in chapter 7.

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CHAPTER 4 Labor Markets, Economic Interests, and Public Support for European Integration The analysis in the previous chapter identified occupation-based differences in citizens’ utilitarian evaluations of integration. One difference was based on occupational skills: citizens with skilled occupational experiences expressed greater utilitarian support than citizens lacking these skills. This occupation-based difference in support was consistent with the differential economic benefits of integration related to human capital. The second occupational difference was based on financial compensation from the European Union (EU). Farmers are the primary recipients of EU spending, and they generally express greater support for integration than nonfarmers. In this chapter, I expand the policy appraisal model by investigating how differences in the economic benefits derived from integration vary within these occupational groups. I then examine how this variation in benefits is related to intraoccupational differences in utilitarian evaluations of integration. First, I use economic theory to identify differences among skilled and unskilled workers in the benefits they derive from integration. The free movement of labor, goods, and capital in the EU market creates new competition in national markets for skilled and unskilled jobs. For these two groups of workers, I examine whether intraoccupational differences in competitiveness account for intraoccupational differences in utilitarian evaluations of integration. Second, I examine how the distribution of EU financial compensation among farmers is related to differences in utilitarian evaluations of integration among farmers.

Occupational Skills, Economic Interests, and European Integration In the previous chapter, the human capital hypothesis identified different economic consequences of European integration for two groups of citizens: skilled and unskilled workers. However, within these two groups, the economic benefits and costs of integration are not uniform. Variation in intraoccupational opportunities and economic benefits from integration depend on the distribution of wages, capital investments, factor endowments, Page 58 → and productivity across the European Union. These economic conditions vary substantially (Tsoukalis 1993). If the policy appraisal model is correct, then these differences in intraoccupational opportunities should translate into variation in support for integration within the skilled and unskilled groups. This section investigates how the occupational costs and benefits of integration are distributed within these two occupational groups. In a later section I examine the connection between intraoccupational differences in the benefits of integration and intraoccupational variation in utilitarian support. Comparative Advantage and the Gains from Trade The international trade theory of comparative advantage states that trade liberalization leads nations to specialize their economic production according to their productive advantages compared to their trading partners. According to the Ricardian model, relative productivity determines comparative advantage. Specialization takes place in the sector of the national economy where firms have the greatest productivity advantage relative to the trading partners (Krugman and Obstfeldt 1994). This is known as the “specific factors” model of comparative advantage (Frieden 1991, 436). Alternatively, the Heckscher-Olin model posits that relative factor endowments determine comparative advantage. A nation specializes in production that uses intensively its abundant factor (e.g., capital or labor). Under free trade, nations export products derived from their relatively abundant factors and import products derived from their scarce factors (Stolper and Samuelson 1941, 65–66). This is referred to as the “abundant factor” model of comparative advantage. In these models, trade liberalization causes a redistribution of income to those firms (and their employees) with a comparative advantage. Consequently, citizens’ gains and losses from free trade depend on their occupation. Citizens employed in relatively productive sectors or who employ relatively abundant factors in their job benefit from free trade. Previous research in international political economy has effectively demonstrated that these

distributional consequences of trade have significant effects on political behavior, as social groups pursue their trade-related interests in domestic political competition (Rogowski 1989). It is important to note that comparative advantage in both models is based on differences in national economic characteristics: the relative national factor endowment and the relative national distribution of labor productivity across firms compared to those of the trading partners. For example, the abundant factor model claims unskilled laborers in relatively Page 59 → labor-abundant nations should gain from trade while manual laborers in relatively labor-scarce nations should lose from trade. In short, the basic conclusion from both models is that national comparative advantage determines differences in benefits from free trade within particular occupations. Beyond National Comparative Advantage These theories of comparative advantage provide an incomplete account of the occupational benefits and costs from market liberalization in the European Union. The European Union, as an internal market, allows for the free movement of labor and capital as well as goods. International economic theory posits that the creation of an internal market leads to a different pattern of specialization and a different distribution of occupational benefits than that generated from the theory of comparative advantage. What kind of specialization accompanies the creation of an internal market? Three prominent theories of regional economic integration provide different answers. First, the abundant factor model, when applied to an internal market, posits that the endowment of factors across nations should converge in the long run. This should lead to declining specialization in production across nations as factor mobility equalizes factor prices across nations (Kim 1995). Labor will move from labor-abundant nations, where wages are relatively low, to labor-poor nations, where wages are relatively high. Capital resources will move from capital-abundant regions, where the returns on capital are relatively low, to capital-poor regions, where the returns on capital are relatively high. Thus, in contrast to the theory of comparative advantage, specialization according to relative national factor abundance does not determine the distribution of occupational benefits resulting from an internal market. Second, the specific factor model, when applied to an internal market, predicts specialization across national economies in response to absolute rather than comparative advantage (Krugman and Obstfeldt 1994, 183). A firm (e.g., an automaker) has an absolute advantage if it is more productive than its competitors within its sector (e.g., the auto industry) of the internal market. This differs from comparative advantage, where the productivity of a firm (e.g., an automaker) relative to firms in other sectors (e.g., agriculture) within its national economy influences the pattern of specialization.1 Absolute advantage determines specialization because all firms in an internal market have access to the same productive resources: for example, labor and capital. As a result, those firms that can use these resources more efficiently have a competitive advantage in their sector of Page 60 → the internal market. Thus, the creation of an internal market should lead to a redistribution of production throughout the integrated economy in response to the absolute advantage of particular firms. Third, Krugman's (1991) theory of regional economic integration posits that factor mobility will lead to regional specialization based on external economies of scale. External economies of scale refer to efficiency gains in a firm's production resulting from the size of an industry, regardless of the size of any one firm in that industry (Krugman and Obstfeld 1994, 115). As the size of an industry increases, all firms benefit from the development of networks for the supply of intermediate products and for the distribution of final products. In this model, specialization in different industries is driven largely by consumer tastes and the geographic location of industrial centers, not national factor endowments or comparative labor productivity. Labor and capital move from regions in economic decline to regions where growth industries agglomerate. This leads to regional specialization in particular industries, such as the concentration of the U.S. auto industry in Detroit, Michigan. While these model diverge considerably in their predictions concerning the pattern of industrial specialization across the EU market, they share two important implications for understanding the differential benefits of integration among skilled and unskilled workers. First, national comparative advantage (depicted as specific factors or abundant factor) does not determine the distribution of economic resources in response to EU market

liberalization. Second, firms’ benefits and losses from integration are not necessarily shared by their employees. Firms are not limited to their national labor market, nor are skilled and unskilled workers limited to employment in national firms. Firms can hire labor from the entire EU labor market, thereby expanding the number of jobs that citizens can compete for and the number of competitors for any given job. Employees whose firm loses from integration are able to seek employment with firms that benefit; employees whose firm benefits face competition for their job from employees from losing industries. In other words, skilled and unskilled workers’ occupational fortunes depend on their own competitiveness, or personal comparative advantage, in their occupational sector of the EU market.2 In the following section, I will discuss specifically what determines this personal comparative advantage for skilled and unskilled workers in the EU market. Unskilled Workers and Economic Integration The liberalization of capital and labor movements has a profound impact on competition for jobs among unskilled workers in the European Union. Page 61 → First, the supply of labor is shared by the entire European Union, thereby decreasing cross-national differences in labor supply that influence wages. Second, the mobility of capital and labor should tend to equalize the labor/capital ratio across the European Union, promoting a convergence of wages for labor. This is accomplished by capital flowing to cheaper labor and this cheaper labor moving to the higher-wage jobs. For example, firms in Luxembourg may move their production facilities to Portugal to take advantage of relatively lower-cost workers and/or Portuguese workers may move to Luxembourg to work for higher wages. Consequently, unskilled workers in Luxembourg face increased competition for their jobs, and Portuguese unskilled workers have increased opportunities to earn higher wages. These incentives for capital investment in low-wage markets are further enhanced by the EU's elimination of barriers to trade. Trade restrictions such as tariffs increase the costs for international producers to centralize production in low-wage markets. Indeed, this may be the explicit purpose of trade restrictions, as nations attempt to attract foreign direct investment by allowing the free movement of capital, but not goods, into their territory.3 The EU's elimination of barriers to trade and capital allows firms to optimize their return on capital. Firms can locate their labor-intensive production in low-wage markets and then sell these products throughout the EU market unhindered by tariffs. For example, in 1993 Hoover moved its production facility from Dijon, France, to Glasgow, Scotland, in order to concentrate its European production of vacuum cleaners in a region with relatively cheap labor.4 For unskilled workers, what determines personal comparative advantage from this market liberalization? Personal comparative advantage depends on how firms distinguish among unskilled workers in selecting employees. In hiring decisions, firms consider both the productivity and the cost of the employee. For unskilled workers, firms can base employment decisions predominantly on cost (wages), since the skills of the employee are generally unrelated to her productivity. Thus, relatively low-wage unskilled workers are attractive to mobile capital and benefit from greater demand due to market integration. For example, low-cost unskilled labor in Spain and Portugal has attracted investment in manufacturing and textiles from other EU members (Wall Street Journal, December 9, 1993, A10).5 In contrast, high-wage unskilled workers are disadvantaged by integration, since market liberalization forces them to compete with low-wage workers for employment and wages. Due to these consequences of market liberalization, I expect low-skilled EU citizens (manual workers) to evaluate integration differently depending on their relative wages. In turn, I expect manual workers’ utilitarian Page 62 → support to reflect these different evaluations, with utilitarian support for integration among manual workers inversely related to wages. I refer to this hypothesis as the relative wages hypothesis. Skilled Workers and Economic Integration What determines personal comparative advantage from the creation of an internal market among skilled workers? As was the case with unskilled workers, personal comparative advantage depends on how firms distinguish among workers in selecting employees. In hiring skilled workers, firms distinguish among applicants according to their productive skills. In particular, firms consider the human capital resources the worker adds to productivity. Human

capital contributes to capital resources in the form of invention, managerial strategies, and technological knowledge. Consequently, the salaries of skilled workers resemble an investment decision by the firm, with the salary reflecting the value of the worker to her firm's productivity (Bok 1993). With market liberalization, EU firms are able to choose skilled workers from the full EU labor market. Consequently, a liberalized EU labor market creates increased opportunities for skilled workers whose human capital is of relatively high value and offers increased competition for skilled workers with relatively low-value human capital.6 For example, an executive whose skills are relatively advanced in her national labor market but relatively low in the EU labor market will face increased competition for her job. Her firm would have the incentive to replace her with a more productive executive from the EU market. What determines the relative value of skilled labor in the EU market? Across the European Union, I expect variation in the advancement of technology and capital resources to determine the relative value of skilled workers’ human capital. Advanced economies provide skilled workers with education, experience, and training in new technologies that make them relatively more productive than skilled workers from less-advanced economies. This is true because, by definition, advanced economies are relatively more capital abundant than less-advanced economies. Skilled workers in advanced economies have professional opportunities to interact with and adapt to these new technologies—opportunities that are not afforded to their counterparts in less-advanced economies. Examples of this would be experience with computer technologies, managerial techniques, and advanced production methods. For these reasons, regional and national differences in technological and financial capital resources promote reputations concerning the relative value of skilled labor (Bok 1993, 68). The differences in training and experience—and subsequent reputation—of professionals and executives from advanced economies make Page 63 → them more competitive in a liberalized EU market than their counterparts from less-advanced economies. In addition, there is variation in the value of human capital across skilled workers within national economies. These differences in human capital are generally captured in differences in remuneration, with wages positively related to productivity. For example, the most skilled doctors and lawyers in a national market generally command the highest salaries in their occupation (Bok 1993). Thus, skilled workers can be differentiated according to the value of their human capital by the productivity of the economy in which they work and by their wage-level within their national economy. If the policy appraisal model is accurate, these differences in occupational opportunities from integration for skilled labor should translate into corresponding variation in utilitarian support for integration. Specifically, I expect utilitarian support to be positively related to the relative value of the human capital of professionals and executives. I refer to this as the relative human capital hypothesis.7

Farmers and Variation in CAP Spending As discussed in the previous chapter, the Common Agricultural Policy (CAP) is a redistributive policy. The costs of the Common Agricultural Policy are spread out across all EU citizens (as consumers and taxpayers) and the benefits are concentrated among farmers. However, the benefits of the Common Agricultural Policy are not evenly distributed across farmers and have changed over time. The magnitude of agricultural subsidies and protection provided by the Common Agricultural Policy varies depending on the type of agricultural production. For example, as discussed in chapter 3, the Common Agricultural Policy imposed restrictions on subsidies for dairy, sugar, and cereal producers in the 1980s while leaving other forms of production untouched. I expect the distributional consequences of the Common Agricultural Policy to influence farmers’ evaluations of European integration. Specifically, I expect farmers’ utilitarian support for integration to increase with their financial benefits from the Common Agricultural Policy. I refer to this as the CAP distribution hypothesis.

Testing the Expanded Policy Appraisal Model Data and Methodology

To test the relative wages, relative human capital, and CAP distribution hypotheses, I use the same data set as in chapter 3 with the addition of OECD economic data and financial statistics from the European Union. Page 64 → These data include all respondents to the Eurobarometer surveys from the spring of 1975 through the spring of 1992. The selection of this data is discussed in chapter 3. Also, as in chapter 3, the dependent variable is “utilitarian support for integration” as measured by the survey question Evaluation of Membership. The selection and coding of this variable are discussed in chapter 3. This variable ranges from 0 (negative evaluation) to 100 (positive evaluation). Three explanatory variables were constructed to examine the relative wages hypothesis and the relative human capital hypothesis. To test the relative wages hypothesis, I created an interaction term, Relative wages. This variable is constructed by multiplying the occupational dummy variable for manual workers by a respondent's relative income. Since the dummy variable is coded zero for non-manual laborers, the parameter estimate for this interaction term estimates the relationship between relative income and support for integration only among manual workers, that is, unskilled workers. I expect income to be inversely related to support for integration among manual workers, as market liberalization favors low-wage workers at the expense of high-wage workers. The calculation of relative wages used for this variable is described in detail in appendix C. In brief, I made two adjustments to each respondent's income as reported in the Eurobarometer. First, I converted reported income into 1990 U.S. dollars according to exchange rates.8 This allows wages to be compared across nations, and it adjusts for inflation across nations and years. I use exchange rates to adjust wages. Since capital is much more internationally mobile in the EU market than labor (Tsoukalis 1993, 173), the personal comparative advantage of a manual worker depends on how successful his wages are at attracting capital investment. In comparing the wages of manual laborers, exchange rates capture the differences in costs of these wages from an investor's perspective.9 I then converted the adjusted income to represent variation from the mean income for each survey. That is, I subtracted the average adjusted income for each survey from the respondent's adjusted income. This adjustment is necessary because the relative wage advantage or disadvantage of a manual worker is only relevant in relation to her contemporaries. By making this second adjustment, the data distinguish between a wage of $2000/month in 1980, which is $1000 above average, and the same wage in 1990 that is the average wage due to an EU-wide increase in wages. I use the same variable construction to test the relative human capital hypothesis, which applies to skilled workers. I created two interaction terms, Relative human capital (professional) and Relative human capital (executive). I constructed these two variables by multiplying the respective occupational dummy variable by a respondent's adjusted relative income. Page 65 → Thus, this variable estimates the relationship between income and support only among these two groups of skilled workers. However, in contrast to the variable Relative wages, I use purchasing power parities (PPPs) instead of exchange rates to adjust the income of executives and professionals. I use income to differentiate skilled workers according to their level of human capital because, generally, wages for skilled workers are positively related to their productivity. As discussed earlier, this is particulary true within a national labor market. However, for wages to capture accurately differences in the value of skilled workers’ human capital across national markets, wages need to be adjusted to capture differences in productivity. Exchange rates, which reflect international flows of capital due to other factors than productivity (such as interest rates), do not necessarily capture these productivity differences. Purchasing Power Parities (PPPs) incorporate cross-national differences in productivity in their comparisons of currencies. PPPs measure how much of a given currency is required to buy a set basket of goods. As a nation's capital and technological resources increase, its economy can produce more value for every unit of labor. This increased value can then be exchanged for goods—that is, increased purchasing power. Thus, as a nation's productivity increases relative to another nation, the PPP for its currency increases relative to the currency of the other nation. In turn, weighting executives’ and professionals’ income by their PPPs allows a comparison of their income based on the productivity of the economy in which they acquired their training and skills. Another advantage of PPPs is that they adjust wages to account for distortions in the labor market that cause

differences in skilled workers’ wages that are not due to productivity. For example, some national markets for skilled occupations are protected by barriers such as language or national credentials. If skilled laborers are relatively scarce in a protected market, then this scarcity may inflate their wages above what their skills would merit relative to the full EU market. Consequently, some cross-national variation in wages for skilled workers may reflect national differences in the supply of capital, not differences in their level of human capital. For wages to reflect accurately differences in the value of human capital across skilled workers, wages need to be adjusted to compensate for such national differences in supply. PPPs adjust for these national differences in the supply of human capital by discounting the wages of skilled workers in relatively capital scarce national economies. Since a nation's PPP with another nation increases with its relative productivity, and since productivity is positively related to the supply of human capital, PPPs adjust currencies to the advantage of nations that are relatively abundant in human capital. Page 66 → Finally, to test the CAP distribution hypothesis, I differentiated EU farmers according to the income they received from the Common Agricultural Policy. An ideal test of this hypothesis would require individual-level data on farmers’ payments from the Common Agricultural Policy. These data are not available. However, data are available on annual CAP payments to the EU member states. From these statistics, I calculated the per capita CAP payments in 1975 ECU for farmers in each nation for each year from 1975 to 1992.10 In other words, I calculated the average financial benefit from the Common Agricultural Policy for a farmer in each country, each year. This measure of farmers’ financial benefit can be compared across time and member states. Thus, I can examine the relationship between CAP receipts and farmers’ utilitarian support by national groups of farmers. Figure 3 displays the level of CAP per farmer spending by nation and year. I then constructed an interaction term called CAP Subsidies that is the product of the occupational dummy variable for farmers multiplied by the per capita subsidies from the Common Agricultural Policy for farmers in the respondent's country and year of the survey. For nonfarmers CAP subsidies equals zero. For farmers, CAP subsidies equals the average subsidy to farmers in that country in that year. I expect farmers’ utilitarian support to vary positively with their per capita receipts from the Common Agricultural Policy. Descriptive statistics for all of the explanatory variables are presented in table 13. Model Estimation and Statistical Results These four new variables were added to those examined in the regression analysis in chapter 3 to construct a revised policy appraisal model.11 I use an ordinary least squares regression (OLS) of pooled cross-sectional data to estimate the hypothesized relationships regarding relative wages, relative human capital, and CAP distribution. As in the analysis in chapter 3, I include dummy variables for each nation and each year in the statistical model to avert potential estimation problems associated with this design.12 Also, I estimate White (1980) heteroskedasticconsistent standard errors for the parameter estimates. For a discussion of the methodological issues, see chapter 3. The statistical results are presented in table 14. As in chapter 3, I estimate three models. Model 1 includes the full sample of respondents from 1975 to 1992. I estimated a separate model (model 2) for the pre–Single European Act (SEA) subsample and a separate model (model 3) for the post-SEA subsample. For a discussion of the selection of these two sub-samples, see chapter 3. The baseline respondent in this model is a British Page 67 → male who finished his education between the ages of 14 and 20, whose income falls in the second national quartile (Low-Mid), who resides in a non-border region, and who is employed in a white-collar profession. The baseline year is 1989 in models 1 and 3 and 1992 in model 2. For Relative wages, Relative human capital (professional), and Relative human capital (executive), the baseline is the average income for the year of the survey.13 For CAP Subsidies, the baseline is a farmer who received zero national per capita receipts from the Common Agricultural Policy. All parameter estimates should be interpreted relative to this baseline.

Finally, it is important to recognize that the dependent variable has a mean of 75.5 and a standard deviation of 36.1 points. This means that most of the variation in support across individuals is between about 40 and 100. Since each explanatory variable accounts for only a fraction of this variance, the magnitude of the coefficients may appear small relative to the 100-point scale. The reader should keep this in mind when considering the substantive significance of the estimated relationships. The results are consistent with the relative wages hypothesis that relative Page 68 → Page 69 → wages influence evaluations of EU membership among manual laborers. The parameter estimate on the income interaction term for manual workers is negative, indicating an inverse relationship between income and utilitarian support among manual workers. In model 1, a one standard deviation (one-SD) increase from the mean income ($1168.4) for manual workers is associated with, ceteris paribus, about a 1.75 point decrease in support for EU membership. The results are also consistent with the relative human capital hypothesis concerning relative income for professionals and executives. For skilled workers, utilitarian support is positively related to income adjusted by purchasing power parities. For professionals in model 1, a one-SD increase in income ($836.2) is associated with an average increase of 3.43 points in utilitarian support. For executives in model 1, a one-SD increase in income ($716.4) is associated with an average increase in utilitarian support of 2.15 points. Figure 4 provides a more comprehensive picture of how the relative wages and relative human capital hypotheses account for occupational differences in utilitarian support, holding all other variables constant. The lines plotted for each occupation follow the slope of the parameter estimates for the interaction terms for each occupation—Relative wages, Relative human capital (professional), and Relative human capital (executive)—from model 1, table 14. For a respondent with the mean income in his occupation, his level of utilitarian support is equal to the intercept plus the value of the coefficient for the dummy variable corresponding to his occupation. For example, for a manual laborer with the mean income, the level of support is the sum of 59.30 and –4.94 which is 54.36. This is the level of support associated with a zero difference from the mean income for manual laborers in figure 4. As respondents’ incomes vary from their occupational mean, their level of support changes in accordance with the lines traced out in figure 4. These lines range roughly from the minimum to the maximum income difference from the mean for each occupation. The trend evident in figure 4 is that as income increases, the skill-based difference in utilitarian support grows larger. The most poorly paid respondents for each occupation differ only slightly in their evaluations of membership (holding all other variables constant). Interestingly, at the very extreme negative difference from the mean income, skilled workers expressed less utilitarian support than the unskilled workers. In contrast, among the best paid respondents in these occupations, skilled workers express over 20 points greater utilitarian support than unskilled workers. Thus, considering that the dependent variable has a standard deviation of Page 70 → about 36 points, relative income accounts for a substantively large divergence in support between skilled and unskilled workers. The results are also consistent with the CAP distribution hypothesis. Farmers receiving large per capita CAP subsidies expressed greater utilitarian support than farmers with small per capita subsidies. To interpret the effect of CAP spending, the coefficient for the Farmer dummy variable is added to the coefficient for CAP Subsidies multiplied by the amount of per capita national CAP subsidies. For a farmer whose nation received no CAP subsidies, there is no occupational influence on utilitarian support. The coefficient for the dummy variable Farmer is not statistically significant, that is, zero. This zero is added to the CAP subsidies coefficient (.44) multiplied by zero, which also equals zero. For farmers in nations that received CAP subsidies, utilitarian support rises with per capita receipts. On average, a one standard deviation increase in per capita subsidies (7,100 ECU/farmer) is associated with an increase of 3.12 points in utilitarian support. The evidence from models 2 and 3 demonstrates the robustness of these relationships over time. The parameter

estimates from the regressions in both the pre- and post-SEA subsamples are consistent with expectations. Utilitarian support decreases with income for manual workers, increases with income for professionals and executives, and increases Page 71 → among farmers with their level of per farmer national CAP subsidies. Note that the coefficient for Farmer differs between the pre- and post-SEA sample, indicating a shift in the baseline value of support for farmers relative to other citizens. This may reflect farmers’ reaction to the entrance of Portuguese and Spanish farmers into the European Union in 1987 and the related reforms of the Common Agricultural Policy. The regression models also included the explanatory and control variables analyzed in chapter 3. The results for these variables are presented in appendix B. The results for the explanatory variables analyzed in chapter 3 are consistent with theoretical expectations. Occupation, income, education, and residence variables are related to utilitarian support as hypothesized in the previous chapter. The adjusted R2 of the model is reported out of convention. See chapter 3 for a discussion of the relevance of R2 in the context of this study.

Conclusion The results of the statistical analysis offer further evidence that variation in EU citizens’ utilitarian support is consistent with their differential benefits from integrative policy. These findings expand on the policy appraisal model, providing a more sophisticated understanding of occupation-based differences in support for integration. Consistent with the human capital hypothesis introduced in chapter 3, skilled workers are on average more supportive of integration than unskilled workers. However, the size of this difference varies systematically with income. This result has important implications for understanding economic and political coalitions regarding European integration. Traditionally, labor and capital have occupied opposing positions in the political economy of Western Europe nations. This is reflected in the traditional Left–Right dimension of party politics, with unskilled labor disproportionately supporting Left parties and skilled labor disproportionately supporting non-Left parties (Gallagher, Laver, and Mair 1992, 176; Dalton 1988, 155). However, while the distinction between skilled and unskilled labor may be meaningful politically in the national arena, the results of this chapter suggest that this same distinction may not translate to the European level. The analysis indicates that relatively low-wage manual laborers, executives, and professionals are closer in their level of utilitarian support with each other than with their occupational counterparts with relatively high wages (see fig. 4). This suggests that occupational skills may not foster the same political cleavages and coalitions at the EU level that have historically emerged at the national level in European politics. This has important implications for the development of a European party system Page 72 → in the European Parliament, which will be discussed in the concluding chapter. In addition, the relationship between farmers’ utilitarian support for integration and their financial benefits from EU spending has several important implications for understanding public support for integration. First, this result indicates that reforms of the Common Agricultural Policy will influence farmers’ evaluations of integration. Since recent and projected reforms of the Common Agricultural Policy call for decreases in agricultural subsidies, we should anticipate a decline in farmers’ support for integration. Second, this result suggests that the European Union can “buy” or lose support from integration through redistributive fiscal policies. In turn, the resulting shifts in public support can influence the process of integration. This is not to say that the European Union, with its small budget, can fund programs that promote widespread support for integration. However, the European Union can afford fiscal programs like the Common Agricultural Policy that target a small group. Correctly targeted, this type of spending can influence elite-bargaining over integration. For example, if the targeted group is well organized politically at the national level (e.g., farmers in France), then this spending could influence integration through public pressure via national political channels.

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CHAPTER 5 The National Political Economy and Public Support for European Integration In chapters 3 and 4, I investigated how the microeconomic benefits and costs of integrative policy influence citizens’ utilitarian support for integration. I demonstrated that several economic implications of European integration transcend national boundaries, accounting for variation in utilitarian attitudes independent of nationality or time. In this chapter, I focus on how economic integration influences citizens’ welfare through its impact on the national economies of the EU member states. Specifically, I investigate how the macroeconomic consequences of EU market liberalization differentially influence citizens’ economic and political interests and, in turn, shape their utilitarian evaluations of integration. That European integration has important national economic and political consequences is hardly surprising. The impetus for European integration was based on the political and macroeconomic concerns of the founding member states of the European Community (EC). These states joined the European Community in response to the economic and political legacy of World War II: lost colonies, destroyed infrastructures and industries, and a defunct security arrangement. Economic integration was designed to energize the economic recoveries of its participants and reduce political tensions on the Continent. European integration has generally delivered on this promise. Integration has contributed to economic growth and the reduction of military tensions among its member states. Furthermore, these national economic and political concerns continue to motivate European integration. For example, recent steps taken to complete the internal market and achieve economic and monetary union were motivated by concerns about both economic growth and political/security interests (Sandholtz 1993). The liberalization of the EU market has three important utilitarian implications for national politics and economics. First, the liberalization of trade has differential benefits for EU national economies depending on national commercial relations within the European Union. Second, by eliminating trade policy as a tool of diplomacy and institutionalizing economic and political links among the member states, European integration Page 74 → fosters economic interdependence among its members that increases the costs of intra-EU military conflict. This reduces the likelihood of intra-EU war. Third, European integration provides greater economic predictability and growth for its member states, which enhances the consolidation of democratic capitalism. Citizens derive benefits from these three consequences of integration to the extent that their national economy benefits, their national security improves, and they value the consolidation of democratic capitalism. As I argue below, citizens vary systematically in these benefits. In turn, I expect citizens to differ in their level of utilitarian support for integration as a result of this variation in benefits. In this chapter I expand the policy appraisal model to include these three welfare implications of integrative policy and examine their impact on citizens’ utilitarian evaluations of European integration.

Trade Liberalization and the National Economy Membership in the European Union represents a liberal trade policy for its members vis-à-vis the other EU members. Liberalized trade may influence national economic conditions in a variety of ways that are salient to EU citizens’ welfare. Free trade can promote economic growth and increased employment. This, in turn, translates into increased tax receipts and expanded public services (Swank 1993, 39). In contrast, liberalized trade can harm a national economy that is uncompetitive with foreign firms, causing a decline in national economic performance, a decrease in tax receipts, and a reduction in public services for citizens. Thus, liberalized trade within the European Union has utilitarian ramifications for EU citizens due to its effects on their national economies. The impact of EU trade liberalization on each nation's economy depends on the structure of its international trade

and the importance of trade to its economy. Integration constitutes an advantage for citizens of nations whose economy depends heavily on intra-EU commerce since EU trade liberalization makes trade more dependable and efficient. As Katzenstein (1985) argued in reference to the small European states, economies that are highly dependent on trade benefit both politically and economically from expanding trade liberalization with their trading partners. In contrast, economies that have a low trade dependence have less to lose economically by restricting trade so as to avoid or soften the economic change and dislocation associated with trade liberalization (Katzenstein 1985, 44). Thus, citizens should increasingly value trade liberalization with particular nations as their national dependence on that trade grows. Translating this hypothesis into the EU context, I expect the benefit of EU Page 75 → trade liberalization for citizens to vary positively with the importance of intra-EU trade to their nation's overall economic activity.1 I refer to this as the trade dependence hypothesis. In addition, trade liberalization influences a nation's economy depending on its trade balance with the other EU member states. Nations that enjoy a trade surplus with other EU members benefit from trade liberalization since it provides national producers with increased access to profitable markets. This growth in export markets benefits the national economy. Conversely, nations whose industries are uncompetitive in the EU market face economic costs due to increased competition from imports. The resulting decline in domestic production adversely affects jobs, growth, and government revenues. Consequently, a citizen's benefits from liberalized trade will depend on her nation's intra-EU trade balance. I refer to this as the trade competitiveness hypothesis.

European Integration and National Security The motivation for European integration is not purely economic. European cooperation is also motivated by a Western European desire to institutionalize economic links between its states in order to neutralize the divisive nationalism that led to two world wars. As Jean Monnet stated: The purpose of European Integration is to eradicate the spirit of superiority, of domination which has driven the various nations of Europe, brought wars, and almost the end of Europe and can again, if not destroyed, bring the end of the world … It is the beginning of organizing for peace. Otherwise, domination will be pursued, and with nuclear arms, that is the destruction of humanity. (May 9, 1950, press conference, Paris) The creation of the European Coal and Steel Community (ECSC), the initial step toward European integration, demonstrated the security motivation for European economic cooperation. One of the sources of controversy after World War II was the future of German coal and steel resources. France was in control of the coal-rich Saar basin, to which Germany had territorial claims. In addition, the industrial Ruhr area of Germany was under international control. For security reasons, the French—along with other Europeans—wanted to keep this militarily valuable coal and steel out of German hands. For economic reasons, West Germany needed these resources and this industrial base to rebuild its economy. To resolve this dilemma, Robert Schuman proposed a supranational authority to oversee the tariff-free movement of coal, steel, and iron within the Page 76 → territories of France, West Germany, and other European states. The proposal was realized with the creation of the ECSC. Subsequent economic integration—the creation of the European Economic Community and European Union—have further reduced the ability of EU member states to use exclusionary or restrictive economic policies for military advantage. This security gain from integration—particularly the reduced threat of German aggression—has different utilitarian implications for citizens depending on how sensitive they are to reduced tensions among the West European states. For citizens of nations that suffered great physical and human losses from the two world wars (e.g., West Germany and France), this reduced tension represents a substantial increase in their security. For citizens of nations that suffered smaller losses (e.g., Spain and Ireland), the value of this reduced threat of war is of relatively less importance to their national security. Thus, I expect EU citizens to differ in their security-based evaluations of integration according to the losses their nation endured from previous military conflict among the EU members.

In addition, the salience of security concerns in EU citizens’ utilitarian appraisals of integration should decline over time. While the “German question” may have weighed heavily on the minds of Europeans immediately following the war, the threat of German military hostility toward the EU members decreased substantially over the subsequent decades. Indeed, one of the clearly positive results of European integration has been the absence of military hostility between the EU member states over the past fifty years. As a result, “armed conflict between any two [members] does not now appear to be remotely possible” (Nugent 1994, 7). Thus, while security concerns may vary across citizens depending on their national experience with the world wars, for all EU citizens the relevance of these security concerns should decay over time. I refer to this as the security hypothesis. Note that this hypothesis differs fundamentally from the security hypothesis proposed by Eichenberg and Dalton (1993). Eichenberg and Dalton posited that EU citizens’ security concerns regarding East–West conflict influence their support for integration. I do not share this contention because European integration does not necessarily influence security concerns that EU citizens may have concerning the likelihood of East–West conflict. The North Atlantic Treaty Organization (NATO) and the United Nations were designed explicitly to deal with such conflicts. Consequently, I do not expect citizens’ utilitarian appraisals of European integration to reflect their concerns over East–West conflict or their general national security. Eichenberg and Dalton (1993) presented evidence in this regard, showing that the level of East–West conflict is not statistically related to support for European integration. Page 77 →

European Integration and the Consolidation of Democratic Capitalism Prior to World War II, most nations in Western Europe had developed democratic political systems and capitalist economic systems. Many of these regimes suffered from both economic and political instability, particularly during the 1930s. This instability, in conjunction with the eventual fall of these regimes, fostered political opposition to democratic capitalism after the war (Lindberg and Scheingold 1970, 6). On the one hand, communist parties espoused the replacement of capitalist economies with command economies, by whatever political means necessary. On the other hand, extreme right-wing parties emerged that rejected pluralistic democracy in favor of authoritarian direction of the government and economy. Consequently, the postwar democratic-capitalist regimes of Western Europe faced political challenges from both ideological extremes of the political spectrum (Urwin 1972, 154). European integration provides support for democratic capitalism. As Urwin argues: After 1945 the extent of wartime damage and dislocation, the dearth of economic resources, and the advent of the Cold War had posed to parliamentary democracy in Western Europe a challenge as grave in its implications as the Nazi threat. To a large extent this threat had been countered, especially in France and Italy with their large Communist parties, by the massive influx of American financial aid and by the developments of the plans for European and Atlantic communities. (1972, 279) The creation of an internal market in the European Union was designed to promote economic predictability and growth for its members, based on a capitalist system. This economic certainty and growth enhanced EU member states’ abilities to respond to the economic demands of their electorates. As one example, the postwar economic growth financed the dramatic expansion of the welfare state in Western Europe. These welfare policies addressed many of the economic concerns of the working class, a traditional base of support for communist parties (Slater 1983). In short, the contribution of European integration to domestic economic conditions helps its member states reduce domestic political opposition to democratic capitalism. Thus, for EU citizens who support democratic capitalism, European integration provides a political benefit by enhancing the stability of their political economy. The extent to which these citizens value this benefit depends on the current threat to political stability. Supporters of democratic Page 78 → capitalism who live in nations with strong political opposition to democratic capitalism should value integration more than supporters who live in nations with only weak political opposition. I expect this political stability concern to influence utilitarian evaluations of integration, with utilitarian support positively related to the value citizens place on the stabilizing role of European integration. I refer to this as the political stability hypothesis.

Testing the Expanded Policy Appraisal Model Data and Methodology To test the trade dependence, trade competitiveness, security, and political stability hypotheses, I use the same Eurobarometer data set as in chapters 3 and 4 with the addition of OECD economic data, war-death data from World War II, and election data from 1970 to 1991.2 These data include all respondents to the Eurobarometer surveys from the spring of 1975 through the fall of 1991. Once again, the selection of this data was based on both theoretical and practical grounds as discussed in chapter 3. The time period is restricted on both ends by data availability. The dependent variable is the same as in chapters 3 and 4: “utilitarian support for integration,” as measured by the question Evaluation of Membership. This variable ranges from 0 to 100. For the coding of this variable see chapter 3. To test the trade hypotheses, I included measures of trade balance and intra-EU commerce constructed from OECD trade data from 1975 to 1991. I constructed two variables: EU Trade Dependence and EU Trade Balance. EU Trade Dependence measures the ratio of a nation's intra-EU trade (imports plus exports) to its gross domestic product.3 This variable captures the dependence of a citizen's national economy on trade with other EU member states. As the ratio increases, the benefits of trade liberalization for the national economy grow. Consequently, I expect citizens’ utilitarian support to be positively related with this variable. Figure 5 plots this measure of national trade dependence over time for each EU member state. The variable EU Trade Balance is a nation's intra-EU trade balance measured in 1990 U.S. dollars and then divided by population.4 This variable is designed to distinguish citizens according to the benefits or costs of EU trade liberalization for their national economy due to the composition of their national intra-EU trade. The variable is measured per capita so as to capture the average costs or benefits from trade liberalization due to the trade balance for each citizen in each nation. This means that an intra-EU trade surplus of one million dollars is given greater value for citizens of Page 79 → Luxembourg (population, 3.5 million) than citizens of France (population, 55 million). I expect citizens’ utilitarian support to be positively related to this variable. Figure 6 displays the intra-EU trade balance per capita for the member states. To test the security hypothesis, I constructed the variables War Deaths and War Deaths Decay. These variables are designed to differentiate EU citizens according to the value they place on the security benefits of European integration. War Deaths is the number of military and civilian deaths per capita from World War II for each member state. When calculating this variable, I used estimates of the EU nations’ 1939 (prewar) populations.5 This variable serves as a proxy for the different levels of destruction endured by EU members from World War II. If the security hypothesis is correct, citizens from those nations with the highest scores on this variable have the most to gain in terms of national security from European integration. These citizens should value the reduced threat of conflict among the EU members the most. In contrast, for citizens whose nations Page 80 → suffered relatively less from World War II, reduced tension between the EU members is of lower relevance to their security. Consequently, I expect citizens’ utilitarian support for integration to be positively related with this variable. Figure 7 shows national variation in the War Deaths. War Deaths Decay is an interaction term between the War Deaths variable described above and the number of years since 1975 that the respondent is interviewed. This variable estimates the impact of time on the relevance of security concerns in EU citizens’ utilitarian evaluations of integration. According to the security hypothesis, the relevance of security concerns should decline over time. Thus, I expect utilitarian support for integration to decrease as this variable increases. To test the political stability hypothesis, we need an indicator of each respondent's support for democratic capitalism and a measure of the level of threat to democratic capitalism in her nation at the time of the survey. Page 81 → According to the hypothesis, as a respondent's support for democratic capitalism increases, his utilitarian support should increase. Also, for those who support democratic capitalism, utilitarian support should

increase with the threat to democratic capitalism in their nation. Since there are no survey questions available in the Eurobarometer that provide direct measures of these indicators, I constructed two proxy variables. To measure political opposition to democratic capitalism, I use the percentage of vote won in national legislative elections by parties that oppose democratic capitalism. Specifically, I averaged the percentage won over the two most recent elections relative to the year the respondent was surveyed. I use an average of two elections because temporary changes in electoral support may result from idiosyncratic characteristics of an election (e.g., a corruption scandal). Such election-specific events may cause electoral support for opposition parties to temporarily change while the Page 82 → level of public opposition to democratic capitalism does not. By averaging the electoral performance over two elections, this variable better captures the trend in political opposition to democratic capitalism.

The parties designated as opponents of democratic capitalism included all Communist parties and a select number of extreme right-wing parties. Communist parties represent opposition to democratic capitalism by definition: their political agenda focuses on overturning capitalism. Right-wing extremist parties generally share an antidemocratic orientation (Mudde 1995, 214). According to Ignazi and Ysmal: The distinctiveness of ERPs [extreme right parties] is based not just on the “intensity” of their neoconservative approach. They are distinct because they endanger the legitimacy of the system. The adoption of a more radical version of neo-conservative values by ERPs is intended to undermine the foundation of the system by delegitimizing the parties and the party system, the parliamentary procedure, the principle of equality, and sometimes even the rule of law. (1992, 21–22) I included all the extreme right parties identified by Ignazi and Ysmal (1992, 17) that espouse antisystem agendas as opponents of democratic capitalism. A list of these parties and a discussion of the criteria for their selection is presented in appendix D. Electoral support for communist and these select extreme right parties measures the level of public antagonism toward democratic capitalism. This serves as an indicator of the political threat to the stability of the regime. Figure 8 shows the national differences in electoral support for these anti–democratic capitalism parties. There are no survey questions that directly and consistently ask respondents their level of support for democratic capitalism. Consequently, I use respondents’ partisan affiliations to infer their positions on democratic capitalism. The Eurobarometer consistently asks respondents’ vote intention if a general election were held tomorrow.6 Based on this question, I separated respondents into two categories according to whether or not they supported a political party that opposed democratic capitalism. The designation of opposition parties follows the categories described previously. I will refer to respondents who intended to vote for opposition parties as “opponents,” and respondents who did not intend to vote for these parties as “supporters.” This distinction does not perfectly separate actual supporters of democratic capitalism from opponents, since some respondents may support a party for other reasons than its position on democratic capitalism. However, as long as opponents of democratic capitalism are more likely Page 83 → than supporters to vote for parties that oppose democratic capitalism, the “opponents” group will, on average, be less supportive of democratic capitalism than the “supporters” group. From these measures, I constructed two variables: Pro-Stability and Threat to Stability. Pro-Stability is a dummy variable, coded (0) for “opponents” and (1) for “supporters.” If the political stability hypothesis is correct, then this variable should be positively related to utilitarian support, as the “supporters” value integration, on average, more highly than the “opponents.” The hypothesis also predicts that utilitarian support should increase among these “supporters” with the level of threat to democratic capitalism in their nation. To test this claim, I created an interaction term called Threat to Stability which consists of the variable Pro-Stability multiplied by the level of electoral opposition to democratic capitalism as Page 84 → described above. Since this variable is coded as zero for opponents of democratic capitalism, this variable measures the threat to democratic capitalism only for

supporters. If the political stability hypothesis is correct, the value that supporters derive from integration should be positively related to the level of threat to democratic capitalism in their nation. Thus, I expect a positive relationship between Threat to Stability and utilitarian support for integration.

Model Estimation These five new variables were added to the variables examined in chapters 3 and 4 to create a revised policy appraisal model. Table 15 presents descriptive statistics for these new variables. For a description of these other explanatory variables, see the discussion in chapters 3 and 4. To estimate the hypothesized relationships, I use an ordinary least squares regression (OLS) of pooled cross-sectional data. As in the analysis of the previous chapters, I am concerned about several methodological problems associated with the pooled design (see Beck and Katz 1995; Sayrs 1989; Stimson 1985). Specifically, I want to avoid estimation problems associated with fixed effects for particular nations and years. In the previous chapters, I used dummy variables for nations and years to control for these fixed effects. This analysis calls for a more complex adjustment to the model. The hypotheses specified in this chapter provide theoretically derived explanations for cross-national and crosstemporal variation in support. Consequently, I expect these explanatory variables to account for fixed effects associated with particular nations and years. It is still possible, however, that these explanatory variables do not account for all of the fixed effects. If so, then these fixed effects can cause biased and imprecise parameter estimates. The ideal solution is to include dummy variables for only those nations and years that have fixed effects independent of the explanatory variables (Stimson 1985, 921). Page 85 → To implement this solution, I first estimated the model without dummy variables for specific years and nations. The results of this estimation are reported in model 1 in table 16. I then examined the residual means for each nation and year and reestimated the model including dummy variables for nations and years with large residual means. The residual means for both models are reported in appendix D. The results of this second estimation are presented in model 2, table 16. The nation and time residual means for this model were close to zero, indicating that the parameter estimates should be free of bias associated with any time- or nation-specific fixed effects. Thus, this second model provides reliable estimates of the relationship between the independent variables and utilitarian support for integration. Statistical Results The results of OLS statistical models that test the revised policy appraisal model are presented in table 16. All interpretation of parameter estimates will refer to the results in model 2. The baseline respondent has a zero national intra-EU trade balance, has no national EU trade, is a citizen of a nation that suffered no war deaths from World War II, and opposes democratic capitalism. All coefficients should be interpreted relative to this baseline respondent. The baseline values for the control variables—for example, education—are the same as in the previous chapters. The statistical results are consistent with the trade hypotheses. A one standard deviation (one-SD) increase in a nation's intra-EU trade dependence (25.9 percent of GDP) is associated with a 2.85 average increase in its citizens’ utilitarian support. A one-SD increase in a nation's intra-EU trade balance ($51.29 per capita) is associated with a 2.97 point average increase in its citizens’ utilitarian support. These relationships are consistent with my expectations that utilitarian support for integration is responsive to the economic gains for citizens’ national economy from liberalized trade. The statistical results are also consistent with the security hypothesis. EU citizens’ utilitarian support is positively related to the number of war deaths their nation suffered during World War II. A one-SD difference in the number of war deaths per capita (1.58) is associated with a 2.54 point average increase in utilitarian support. Also consistent with expectations, the impact of this security concern decreases over time. This is evident from the combined impact of War Deaths Decay and War Deaths on utilitarian support. In the first year of surveys

analyzed—1975—the impact of war deaths on utilitarian support is indicated only by the variable War Deaths, since War Deaths Decay is equal to zero. Thus, for French respondents Page 86 → in 1975, the impact of war deaths per capita on support is equal to 1.61 (the coefficient for War Deaths) multiplied by the war deaths per 1000 for France (1.5), which is 2.42 points greater support. For respondents interviewed in more recent surveys, the impact of war deaths on support declines. For example, for a French respondent in 1985, the impact of war deaths per capita on utilitarian support is 1.01 points, 1.41 points smaller than in 1975.7 Thus, as time passes, the impact of security concerns on utilitarian support declines. Finally, the results are consistent with the political stability hypothesis. The coefficient for Pro-Stability indicates that there is no statistically significant difference in support between “supporters” and “opponents” of democratic capitalism when the threat to democratic capitalism is zero. However, among these “supporters,” the level of utilitarian support for integration is positively related to the level of political threat to democratic capitalism in their nation at that time. The parameter estimate for Threat to Stability indicates that as the electoral strength of parties Page 87 → opposed to democratic capitalism increases, “supporters” raise their utilitarian evaluations of integration. For example, a “supporter” that resides in a nation where parties that oppose democratic capitalism won, on average, 10 percent of the vote in the previous two elections expressed 5 points greater utilitarian support for integration than a “supporter” in a nation where there is no electoral support for such parties. This supports my contention that as the political threat to democratic capitalism rises, supporters of the democratic capitalism should increasingly value the stabilizing influence of EU membership. Also, as the threat increases, the difference in utilitarian support between “supporters” and “opponents” grows.

Conclusion This chapter explored the impact of national economic and political benefits and costs from European integration on EU citizens’ utilitarian support for integration. European integration has important consequences for its citizens’ political and economic welfare related to trade, security, and the stability of democratic capitalism. The results of the analysis indicate that citizens incorporate these national considerations in their appraisals of integration. The results have three important implications for understanding utilitarian support for integration. First, domestic politics play a rather counterintuitive role in shaping attitudes toward integration. Many of the parties that oppose democratic capitalism also oppose integration. Thus, as support for these “opposition” parties grows, one might expect aggregate public support for integration to decline. The results of this analysis indicate that growth in opposition has a more complicated effect. Increased electoral support for parties opposed to democratic capitalism leads to greater support for integration among those citizens who do not support these parties. This means that, as long as “opposition” parties continue to represent a minority of the electorate, increases in “opposition” may lead to a cumulative national increase in support for integration. For example, increased support for right-wing extremism among a minority of citizens may serve to increase the national level of utilitarian support for integration. Second, the decline over time in the impact of security concerns on utilitarian support indicates that the level of support in the recent and original members should tend to converge in the future. The original members suffered considerably greater damage from World War II than the later members. As a result, citizens from the original members (e.g., France and Germany) express greater security-based utilitarian support than citizens of the later members (e.g., Greece and Ireland). The magnitude of this difference, however, has declined over time as World War II fades further Page 88 → into the past. As the effect of security concerns on support declines, the difference in the level of support between the original and later members should converge. In addition, this erosion of security-based variation in support means that trade and political stability concerns should increasingly determine cross-national variation in utilitarian support. Third, the results suggest that the emergence of commercial opportunities in Eastern Europe may lead to decreased public support for integration. The results indicate that as a nation decreases its trade dependence on

intra-EU commerce its citizens decrease their utilitarian support for integration. Thus, to the extent that EU members redirect their commerce toward Eastern Europe and away from the EU market, utilitarian support should decline. German trade interests are particularly important in this regard. German economic interests in Eastern Europe and the former Soviet Union may serve to reduce German dependence on and economic interests in EU markets. Given that Germany accounts for a large share of total intra-EU trade, a diversion of German trade away from the European Union could reduce economic interdependence in the European Union and thereby reduce utilitarian support for integration across the EU member states.

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CHAPTER 6 Alternative Explanations for Public Support for European Integration The previous three chapters provided evidence that EU citizens’ utilitarian support for European integration is based on their self-interest. Those citizens who gain from the liberalization of EU markets for goods, capital, and labor are more supportive of integration than citizens who are less favorably affected by integrative policy. However, this evidence deserves further scrutiny because many of the hypotheses were tested through variables that may be theoretically meaningful in other ways. To test the policy appraisal model, I used proxy variables for characteristics of the winners and losers from economic integration. For example, I used education, income, and occupational skills as proxies for EU citizens’ personal gains or losses in occupational opportunities and returns on financial investments due to European integration. But because these proxy variables are politically meaningful in other ways, there may be a variety of explanations for the finding that those labeled as winners are more supportive of integration than those labeled as the losers. Wealth, education, and occupation are often associated with political skills, cognitive skills, or political affiliations that may influence a citizen's support for integration yet may be unrelated to the utilitarian implications of integrative policy. This same issue is relevant to the national-level factors examined in chapter 5. Thus, to be confident in the empirical validity of the policy appraisal model, I will reexamine the policy appraisal model in light of several alternative hypotheses. In addition to assessing the robustness of the policy appraisal model, this analysis is valuable because it reexamines several alternative theories of individual-level public support for integration. These include explanations based on partisanship, cognitive skills, economic welfare, value orientations, and national economic and political characteristics (Inglehart, Rabier, and Reif 1991; Feld and Wildgen 1976; Hewstone 1986; Handley 1981). While these explanations have been supported by empirical evidence, their validity is dubious for methodological reasons. Much of the evidence consists of bivariate analyses, which may conceal intervening or spurious relationships. This chapter will reconsider these explanations in a Page 90 → multivariate analysis, providing a more rigorous test of their empirical validity.

Challenges to the Human Capital and Income Hypotheses In this section, I examine alternative hypotheses for the statistical evidence in support of the human capital and the income hypotheses. The statistical evidence reported in previous chapters consisted of positive relationships between a citizen's level of education, income, and occupational skills and their utilitarian support for integration. To challenge the robustness of these results, I consider several potentially confounding explanations for occupation-, education-, and income-based differences in support for integration. The Class-Partisanship Hypothesis The results of the analysis in chapter 3 indicate that support for integration varies across citizens depending on the degree to which their economic well-being depends on wages relative to returns on capital. This marks a division in citizens’ support for integration along class lines, with wage-dependent citizens (proletariat) less supportive of integration than citizens dependent on returns from capital (bourgeoisie) offering the most support. Partisanship provides an alternative explanation for this class-based variation in utilitarian support for integration. In all of the EU member states, social class serves to distinguish Left parties, affiliated with the working class, from Right parties (Laver, Gallagher, and Mair 1995; Lipset 1981). Differences in the types of voters that support Left and Right parties are generally consistent with the characteristics of the winners and losers from integrative policy identified in the previous chapters. Highly skilled and wealthy citizens—members of the bourgeoisie—tend to identify with Right parties while Left parties generally attract the support of the proletariat (Dalton 1988, chapter 3). Consequently, the evidence from the policy appraisal model is consistent with a class-partisanship

hypothesis. Consistent with this explanation, Inglehart, Rabier, and Reif (1991) identified a class-based partisan cleavage in support for integration.1 They found that supporters of Left parties were less favorable toward integration than supporters of Right parties, and they attributed this difference in support to the positions of Left and Right parties toward European integration. Generally, parties of the Left (particularly communist parties) have been more skeptical of integration than parties of the Right because Page 91 → of their perception that integration is a manifestation of capitalist forces (Wessels 1995). Consequently, parties of the Left have been generally less supportive of integration than parties of the Right (Budge, Robertson, and Hearl 1987). Note that the class partisanship and the policy appraisal explanations are not mutually exclusive. It is possible that citizens may rely on class-based parties for information concerning their personal economic gains or losses from integration, that is, parties help them appraise integrative policy. As a result, public attitudes toward integration may reflect partisan attachments yet also be consistent with the policy appraisal hypotheses. For example, communist party sympathizers may express less utilitarian support for integration than conservative party sympathizers, but a wealthy communist partisan should still express greater utilitarian support than a poor communist partisan. In other words, citizens may appraise integrative policies based on their self-interest, independent of party affiliation. To control for class partisanship, I added variables indicating citizens’ partisan attachment to proletariat and bourgeoisie parties to the basic policy appraisal model tested in chapter 3. In all of the Eurobarometer surveys from 1975 through 1992, respondents were asked a variation of the following question:2 “If there were a general election tomorrow, which party would you support?” Based on responses to this question, I created two dummy variables. One variable, Proletariat Party, was coded one for respondents who named a party that represents working-class interests and zero otherwise. I identified proletariat parties based on party platform descriptions (Gallagher Laver, and Mair 1992; Jacobs 1989; Featherstone 1988; Delury 1983). I present the parties designated as proletariat in table 17. The second variable, Bourgeoisie Party, was coded one for respondents who named a party that represents the interests of capital (e.g., less government involvement in the economy, reduced welfare and redistributive policies, etc.) and zero otherwise. Based on information from the previously cited sources, I designated the parties included in table 18 as bourgeoisie parties.3 Model 1 in table 19 reports the results from a re-estimation of the policy appraisal model including control variables for class partisanship. In spite of these controls, the results indicate that income, education, and occupational skills are related to utilitarian support as predicted by the human capital and income hypotheses. As for the class-partisanship hypothesis, the coefficients for the party variables are statistically significant, and their relationship with support for integration is in the expected direction. Supporters of proletariat parties are on average over Page 92 → nine points less supportive of integration than supporters of bourgeoisie parties. Thus, while class partisanship does not confound the human capital and income hypotheses, it does account for substantial variation in utilitarian support for integration. Some readers may remain skeptical because the analysis does not account for other potentially confounding aspects of partisanship. In response to this concern, I examined the human capital and income hypotheses while controlling for citizens’ attachments to all political parties. The results of this analysis are presented in model 2 of table 19. The parameter estimates for the party variables are presented in appendix E. The results indicate that, in spite of controls for citizens’ partisanship, utilitarian support for integration is positively related to education, income, and occupational skills. Thus, partisanship does not account for the evidence supporting the human capital and income hypotheses. Page 93 → The Political Awareness and Cognitive Mobilization Hypotheses

One of the principal findings of recent research on public opinion in the United States is that the dynamics of attitude formation are different for particular portions of the population (Zaller 1992; Sniderman 1993, 224; Knight 1985; Stimson 1975). The constraints on citizens’ choices over particular issues—for example, selfinterest, ideology, and values—affect citizens’ political judgments differently depending on their political awareness, cognitive skills, and information. This research supports alternative explanations for the results from the policy appraisal model. A citizen's education, occupational skills, and income level tend to be positively related to her level of political awareness and political sophistication. Hence, the evidence in support of the human capital and income hypotheses may be explained by differences in citizens’ levels of political knowledge and cognitive skills. In this section, I will discuss and test two such alternative explanations. Political Awareness

In The Nature and Origins of Mass Opinion, John Zaller constructed a model of opinion formation that describes how respondents receive political messages, assess information relative to their political predispositions, and draw from various considerations to formulate survey responses. An important component of this model is the level of a citizen's political awareness about the issue under consideration. According to Zaller's reception axiom, “the greater a person's level of cognitive engagement with an issue, the more likely he or she is to be exposed to and comprehend—in a word, to receive—political messages concerning that issue” (1992, 42).4 Consequently, even in cases where most of the political messages on an issue are similar, variation in public opinion on that subject may endure as a result of differences in citizens’ levels of political awareness (Zaller 1992, 98). To the extent that there is a general consensus among mainstream political parties in the European Union in favor of integration, it seems reasonable to assume that EU citizens receive predominantly positive messages from political elites concerning integration, thereby creating the type of informational environment in which Zaller would expect political awareness to determine variation in citizens’ attitudes toward integration. The evidence from chapter 3 appears to be consistent with this hypothesis. Political awareness tends to be positively related to income, education, and occupational skills. Citizens with high political awareness are expected to be better able to receive messages (e.g., “European integration is good”) Page 94 → from political elites. Thus, wealthy, welleducated citizens from high-status occupations should express greater support for the mainstream policy (European integration) than the citizens with lower income, education, and job skills. In sum, my designations of “winners” and “losers” from integration correspond to Zaller's designations of the politically aware and unaware, thereby presenting an alternative explanation for the human capital and income hypotheses. To test whether the political awareness explanation accounts for the evidence in support of these hypotheses, I have included control variables for citizens’ levels of political awareness in the original policy appraisal model. While political awareness has been measured in a variety of ways, the most appropriate measure is based on neutral factual knowledge about the issue under consideration (Zaller 1992, 336).5 Eurobarometer surveys do not usually include measures of respondents’ factual knowledge concerning the European Union. However, the fall 1988 Eurobarometer survey does include three such questions. The questions are the following (the correct answer follows each question): 1. Is it true or false that the European Parliament has the power to pass laws that are binding in each membercountry of the EC? (False) 2. Is it true or false that the European Parliament has the power to refuse the EC budget? (True) 3. Is it true or false that the President of the Commission of the EC is elected by the European Parliament? (False) I awarded respondents one point for each correct answer and I then summed their point total, which ranges from zero to three. I constructed a dummy variable for each value, with a score of three coded as “high awareness” and score of zero coded as “low awareness.” Model 5 in table 20 presents the results of a re-estimation of the policy appraisal model with control variables for political awareness. The analysis includes only respondents from the fall 1988 Eurobarometer. The baseline awareness category is a score of one—”low-mid awareness.”

In spite of controls for political awareness, the results support the human capital and income hypotheses. Utilitarian support remains positively related to education, income, and occupational skills. Also consistent with expectations, political awareness has a positive, but small, effect on utilitarian support. The results indicate the respondents who answered all the questions incorrectly expressed, on average, about two points less utilitarian support than respondents who answered any questions correctly. But the evidence does not identify a statistically significant difference Page 95 → in utilitarian support among those citizens who answered one, two, or three questions correctly. Cognitive Mobilization

Inglehart (1970a) offered another perspective on the role of political information in shaping public attitudes. Inglehart argued that high cognitive mobilization, characterized by a high level of political awareness and welldeveloped skills in political communication, enables citizens to identify with a supranational political community (Hewstone 1986, 44). As cognitive mobilization increases, the European Union and the topic of integration should become more familiar and therefore less threatening (Inglehart, Rabier, and Reif 1991, 147; Janssen 1991, 447). Consequently, support of integration should be positively related to cognitive mobilization. This argument is based on two assumptions. First, Inglehart (1970a) contends that well-developed cognitive skills are necessary for understanding information about European integration because this information is often at a high level of abstraction. Second, according to Inglehart's operationalization of this hypothesis, the influence of cognitive mobilization on a citizen's attitude toward integration is message independent (e.g., Inglehart, Rabier, and Reif 1991).6 The ability to understand information about integration, regardless of its content, promotes support for integration. Inglehart, Rabier, and Reif (1991) used a bivariate analysis to demonstrate that variation in public support for integration, as measured by the survey question Evaluation of Membership, was consistent with the cognitive mobilization hypothesis. Also, Janssen (1991) found corroborating evidence from the 1973–89 Eurobarometer surveys in West Germany, France, Italy, and the United Kingdom, while controlling for political value orientations. The cognitive mobilization hypothesis offers an alternative explanation for the evidence from the policy appraisal model. Inglehart, Rabier, and Reif (1991, 147) argued that occupation-, income-, and education-based variation in support for integration is a consequence of the fact that “those with higher status occupations and incomes, tend to be better educated, better informed about politics, and more active politically than the rest of their compatriots.” In other words, cognitive mobilization could account for the evidence in support of the human capital and income hypotheses. Citizens with high levels of income, occupational skills, and education may express greater utilitarian support due to their cognitive mobilization rather than their utilitarian benefits from integrative policy. To determine whether cognitive skills account for the evidence in support of the policy appraisal hypotheses, I reestimated the original policy Page 96 → appraisal model while controlling for citizens’ levels of cognitive mobilization. To measure a citizen's cognitive mobilization, I used responses to the following two questions, which were designated by Inglehart as indicators of cognitive mobilization (Inglehart, Rabier, and Reif 1991, 147): A. Frequency of Political Discussion: “When you get together with your friends, would you say you discuss political matters frequently, occasionally, or never?” B. Frequency of Persuasion: “When you hold a strong opinion, do you ever find yourself persuading your friends, relatives, or fellow workers to share your views: If so, does this happen often, from time to time, rarely, or never?” These questions were asked in all Eurobarometer surveys from 1975 to 1992. I created dummy variables for each of the response categories to these questions. Models 3 and 4 in table 19 present the results from the re-estimation of the original policy appraisal model while controlling for cognitive mobilization. Model 3 includes the dummy variables for responses to question A, Frequency of Political Discussion. Respondents who “occasionally” discuss politics are the baseline. The results

of the analysis continue to support the human capital and income hypotheses. Education, occupational skills, and income remain positively associated with utilitarian support in spite of controls for the frequency of political discussion. The results also indicate that frequency of political discussion is not positively related to utilitarian support. Instead, the relationship is curvilinear, with the highest utilitarian support expressed by respondents who “occasionally” discuss politics. As frequency of political discussion increases from “never” to “sometimes,” utilitarian support increases. But, as the frequency increases from “occasionally” to “frequently,” utilitarian support decreases. Model 4 includes the variables for responses to question B, Frequency of Persuasion. The respondents who “rarely” persuaded others are the baseline. Once again, the results are consistent with the human capital and income hypotheses. Utilitarian support is positively related to citizens’ levels of income, education, and occupational skills in spite of controls for frequency of political persuasion. As for cognitive mobilization, the results indicate that frequency of persuasion has a curvilinear relationship with utilitarian support for integration. Respondents who “never” persuade others expressed less utilitarian support than all other respondents. However, those who “rarely” persuade others expressed greater utilitarian support than respondents who persuade others “from time to time” and those Page 97 → who persuade “from time to time” expressed greater support than those who “often” persuade. Thus, the utilitarian support does not monotonically increase with cognitive mobilization as measured by frequency of persuasion. This result contradicts previous findings by Inglehart, Rabier, and Reif (1991) that analyzed the same dependent variable. In sum, the inclusion of controls for cognitive mobilization do not account for the evidence in support of the human capital and income hypotheses. In addition, both measures of cognitive mobilization are related to utilitarian support for integration in a curvilinear manner. Increased cognitive mobilization is not monotonically associated with increased utilitarian support. This result is surprising given that several scholars have identified cognitive mobilization as one of the primary sources of variation in Europeans’ attitudes toward integration (Inglehart, Rabier, and Reif 1991; Janssen 1991; Inglehart 1970a). I will comment further on this point in the conclusion. The Political Values Hypothesis Ronald Inglehart's theory of a Silent Revolution is arguably the most often cited explanation for Europeans’ attitudes toward European integration (Janssen 1991, 444). According to this theory, citizens’ political attitudes are shaped by the socioeconomic conditions surrounding their formative, or pre-adult, years. These conditions are expected to instill certain values and attitudes, including national identity, that tend to persist over an adult's lifetime.7 Value priorities primarily concerned with economic and physical security are considered “materialist,” and value priorities that include such needs as intellectual fulfillment, self-actualization, and belonging are “postmaterialist.” Inglehart, Rabier, and Reif (1991, 152) argued that the European Union represented a vehicle for social, political, and economic reform toward a less nationalistic, more egalitarian society that would be more attractive to postmaterialists than the less cosmopolitan materialists. Consequently, Inglehart (1970b) predicted that citizens with postmaterialist values would be more supportive of European integration than those with materialist values. Evidence from surveys of the publics of the original EU member states has been consistent with this explanation (Inglehart 1970b; Inglehart, Rabier, and Reif 1991, 152; but see Janssen 1991). Of particular interest to this study, Inglehart, Rabier, and Reif (1991) used a bivariate analysis to demonstrate that variation in responses to the survey question Evaluation of Membership were consistent with this political values hypothesis. Page 98 → Inglehart's value-oriented explanation for variation in public support for integration may explain the distribution of attitudes evident in the policy appraisal model. Postmaterialist values in general and cosmopolitan attitudes in particular tend to be most prevalent among well-educated and wealthy citizens. Consequently, the fact that support for integration is positively related to education and income may merely reflect differences in citizens’ value

orientations. To test this alternative explanation, I reestimated the policy appraisal model with control variables for postmaterialist and materialist value orientations.8 In all Eurobarometer surveys from 1975 through 1992, citizens were asked to choose what should be their nation's goals (first and second choice) from the following four options: (a) maintaining order in the nation; (b) giving the people more say in important government decisions; (c) fighting rising prices; and (d) protecting freedom of speech. The variable Materialist is coded one for respondents who chose (a) or (c) as their first and second choices and coded zero otherwise. The variable Postmaterialist is coded one for respondents who chose (b) or (d) as the first and second choices and coded zero otherwise. Of the 281,811 respondents analyzed, 77,114 were coded as materialists and 33,876 were designated postmaterialists. All other respondents are considered as “mixed” in their value orientations. Model 6 in table 20 presents the results of the reexamination of the policy appraisal model. Respondents with “mixed” value orientations are the baseline. In spite of controls for value orientations, the results are consistent with the human capital and income hypotheses. Education, income, and occupational skills remain positively related to utilitarian support in spite of controls for political values. In addition, the results are contrary to prior evidence concerning the relationship between values and support for integration (Inglehart, Rabier, and Reif 1991). Materialists are more supportive of integration than postmaterialists. There are at least two explanations for this unexpected relationship between political values and utilitarian support. First, European integration may not represent a postmaterialist issue. Indeed, Inglehart, Rabier, and Reif (1991, 152) suggested that by the mid-1970s the European Community had lost its appeal to postmaterialists and was increasingly seen as a buttress for the status quo rather than a reformist institution. Second, earlier studies that found postmaterialists exceptionally supportive of integration were based on bivariate analyses (e.g., Inglehart, Rabier, and Reif 1991). Consequently, the relationship between postmaterialist values and high support for integration may have been spurious. This relationship may merely have indicated that better educated, wealthier, and more professionally skilled citizens—all frequent characteristics of postmaterialists—are Page 99 → supportive of integration. In any event, the results of this analysis indicate that one of the most often cited explanations for individual-level variation in support for integration is dubious. The Economic Perceptions Hypothesis Dalton and Eichenberg (1991) applied a standard argument from the economic voting literature to explain variation in public support for European integration: voters blame (credit) the European Union for economic downturn (upturn). Although their analysis was concerned with aggregate-level support for European integration, they did specify an individual-level hypothesis. Consistent with research on economic voting (e.g., Lewis-Beck 1988), Dalton and Eichenberg hypothesized that public perceptions of the economy, not just objective measures of economic performance, influence public evaluations of political actors. Thus, citizens’ perceptions of their personal and national economic situation, evaluated both prospectively and retrospectively, should influence their attitudes toward political institutions. In evaluating these hypotheses at the aggregate level, Dalton and Eichenberg found modest support.9 These hypotheses concerning economic perceptions offer an alternative explanation for the evidence supporting the human capital and income hypotheses. Insofar as wealth, education, and occupational skills are positively related to more optimistic perceptions of economic conditions, variation in economic perceptions may explain the greater utilitarian support expressed by the “winners” than the “losers” from integrative policy. Note that there is an important difference between the two explanations. Although a citizen's personal or national economic situation is affected by integrative policy, integrative policy is rarely the main determinant of economic conditions. Consequently, citizens who benefit greatly from integrative policy might find themselves or their nation in a poor economic situation due to local business decisions, trade embargoes, or national policies. Thus,

while the economic voting and policy appraisal hypotheses are not mutually exclusive, they do specify different causal relationships. To determine whether the economic perceptions hypothesis accounts for the evidence from chapter 3, I include the following two measures of citizens’ retrospective economic perceptions that were available in several Eurobarometers:10 Personal Economic Situation: How does the financial situation of your household now compare with what it was 12 months ago (got a lot better, got a little better, stayed the same, got a little worse, got a lot worse)? Page 100 → Page 101 → Page 102 → National Economic Situation: How do you think the general economic situation in the country has changed over the last 12 months (got a lot better, got a little better, stayed the same, got a little worse, got a lot worse)? I coded these variables to range from –2 (got a lot worse) to 2 (got a lot better). Since these questions were not asked consistently in the Eurobarometer surveys, the analysis is conducted on data from seven surveys: the falls of 1984 through 1988 and 1991. If retrospective economic perceptions are responsible for the evidence from the human capital and income hypotheses, then these two variables should account for the variance explained by the occupation, education, and income variables. The results of the analysis, presented in table 20, model 7, are consistent with the human capital and income hypotheses. Education and occupational skills remain positively related to utilitarian support in spite of controls for citizens’ retrospective evaluations of their personal and national economic situation. The results are also consistent with the economic voting hypothesis, with support for integration positively related to citizens’ evaluations of their personal and national economic situation. In addition to being statistically significant, perceptions of the national economy have a strong substantive impact on utilitarian support. A respondent who thought her national economic situation was much better than twelve months ago expressed, on average, over twelve points more utilitarian supportive of integration than a respondent who thought that the situation was much worse. The difference in support between the extreme responses to the personal economic situation question was only about three and one half points.

Challenges to the National-Level Hypotheses In chapter 5, I proposed several hypotheses that incorporate components of the national political economies of the member states into citizens’ appraisals of integrative policy. I then provided evidence that national and temporal variation in support is consistent with these hypotheses. However, previous research on aggregate-level support for integration specifies several other economic and political factors that account for this same national and temporal variation. In this section, I reexamine the trade, security, and political stability hypotheses in light of these potentially confounding factors. Page 103 → Socialization and Utilitarian Support Anderson and Reichert (1996), Bosch and Newton (1995) and Inglehart and Rabier (1978) have all used socialization to explain cross-national and cross-temporal differences in support for integration. These scholars contend that membership in the European Union is a socialization process. As an EU member, citizens witness the workings of its institutions, become familiarized with the benefits associated with membership, and consequently develop positive attitudes toward integration (Anderson and Reichert 1996, 240). Thus, the longer a citizen is a member of the European Union, the greater the support for integration. This socialization process predicts much

higher support for European integration among citizens of the original members of the European Union than among citizens of the later members. In addition, it predicts a general trend of greater public support for integration over time (Inglehart and Rabier 1978). This “socialization” hypothesis could account for the evidence in support of the security and political stability hypotheses examined in chapter 5. To the extent that opposition to democratic capitalism generally declined during the 1980s, the “threat to stability” variable may be tapping a time trend in support explained by socialization. In addition, the original members of the European Union generally suffered far greater deaths from World War II than the later members. Since public support for integration is generally greater among the original members than among the later members, War Deaths may actually capture the effect of the greater socialization of the original members than of the later members. Thus, to be confident in the validity of the political stability and security hypotheses, I will reestimate the policy appraisal model with a control for length of membership. The results are discussed in the next section. Objective National Economic Conditions and Utilitarian Support Inglehart and Rabier (1978) and Eichenberg and Dalton (1993) posited that variation in public support for integration is related to objective national economic conditions. Eichenberg and Dalton (1993) argued that citizens appraise integration based on national economic performance: gross domestic product, unemployment, and inflation. They hypothesized rising support for integration as economic conditions improve. This economic explanation for variation in support may account for the influence of the trade variables included in the policy appraisal model. If trade surplus within the European Union and EU trade dependence generally coincide with strong national economic performance, then the evidence in support Page 104 → of the trade hypotheses may actually reflect public responses to objective national economic conditions (Bosch and Newton 1995). Thus, to be confident in the validity of the trade hypotheses, I will include control variables for the economic indicators specified by Eichenberg and Dalton (1993): unemployment, inflation, and gross domestic product (GDP). These economic indicators were collected from the reports of national economic indicators from the Organization for Economic Cooperation and Development (OECD). GDP is adjusted by purchasing power parties and measured in 1990 dollars. Descriptive statistics for these variables are presented in appendix F. Models 1 and 2 in table 21 present the results of the policy appraisal model of chapter 5 expanded to include control variables for objective economic conditions and length of membership. The models were estimated as in chapter 5. I first estimated the regression model without dummy variables for specific nations and years. The results of this estimation are reported in model 1. I then examined the residual means for each nation and year and reestimated the model including dummy variables for nations and years with large residual means. The residual means for both models are reported in appendix D. The results of this re-estimation are presented in model 2. In the reestimated model, the nation and time residual means were close to zero, indicating that the parameter estimates should be free from bias associated with any time- or nation-specific effects. Consequently, model 2 provides reliable estimates of the relationships between the independent variables and utilitarian support for integration. I will refer to the results of this model when evaluating the hypotheses.11 The results indicate that objective economic conditions and the length of membership do not confound the relationships between citizens’ trade, security, and political stability concerns and their utilitarian evaluations of integration. The findings are consistent with those of chapter 5. EU Trade Dependence and EU Trade Balance are positively related to utilitarian support, indicating that respondents’ support increases with the level of trade benefits their national economy derives from integration. War Deaths is positively related to support and War Deaths Decay is negatively related to support, which is consistent with the security hypothesis. Finally, ProStability and Threat to Stability are positively related to utilitarian support, consistent with the political stability hypothesis. Note that the results were also consistent with the other policy appraisal hypotheses.12 Turning our attention to the alternative hypotheses, the results offer limited support. The results are inconsistent with expectations concerning objective economic conditions. The results indicate that as economic conditions

improve—GDP rises, inflation declines, unemployment declines—utilitarian Page 105 → support decreases. Objective economic conditions have exactly the opposite relationship with support than that expected by Eichenberg and Dalton (1993). Finally, the results are consistent with the “socialization” hypothesis. Length of membership, measured in years a respondent's nation has been an EU member, is positively related to utilitarian support for integration. Page 106 →

Conclusion The evidence from this chapter demonstrates the robustness of the statistical relationship between the welfare implications of integrative policy and utilitarian support for integration. Despite the inclusion of control variables for a variety of alternative explanations, the survey evidence continues to support the policy appraisal hypotheses. In addition, evidence from different temporal subsets of the data is also consistent with the policy appraisal hypotheses. The analysis of political awareness involved only one survey and the analysis of subjective economic conditions included seven surveys from different years. I should also note that a comprehensive “control” model, with simultaneous controls for all of the alternative explanations, produced results consistent with the policy appraisal model.13 The results generally support the previous findings that a utilitarian dimension underlies citizens’ attitudes toward integration and that the survey question Evaluation of Membership is an indicator of this dimension. Recall that the Eastonian model holds that utilitarian attitudes reflect citizens’ evaluations of the performance of governing institutions, in this case the European Union. Several of the alternative hypotheses challenged this contention, positing that responses to Evaluation of Membership reflect nonutilitarian concerns. In particular, the political values and cognitive mobilization hypotheses contended that largely immutable political orientations determine responses to this survey question. If these explanations were strong predictors of this variable, this would call into question the utilitarian character of Evaluation of Membership and the dimension it is assumed to represent. The fact that they are not lends further support to the existence of a utilitarian dimension of support for integration. This analysis also provides evidence that challenges several alternative explanations for variation in support for integration. First, the evidence indicates that utilitarian support is not structured consistently with the cognitive mobilization and value orientation hypotheses. Value orientations appear to have an unexpected effect on utilitarian support, with materialists more supportive of integration than postmaterialists. Cognitive mobilization is related to support in a curvilinear manner, as citizens with the highest level of cognitive mobilization express relatively low utilitarian support. It is important to note that the discordance between these results and previous findings is not an artifact of how support is measured. The evidence presented here and the previous results were both obtained using the same dependent variable: Evaluation of Membership. Consequently, the results reported here indicate that the theoretical relationships of cognitive skills and political values with support for integration should be seriously reconsidered. Page 107 → In addition, the evidence indicates that national economic conditions influence utilitarian support, but in an unexpected manner: improving economic conditions are related to declining support. George (1985, 176) offers a potential explanation for this finding: European integration is economically appealing because economic conditions are bad. The argument goes as follows. European national leaders have found themselves increasingly unable to manipulate their national economies. Due to global market trends they have had to endure unacceptable levels of growth, inflation, and unemployment. Closer economic integration with other EU member nations is a way of regaining some of this lost control over their economies. Thus, poor macroeconomic conditions may enhance the appeal of European integration—for example, economic and monetary union—to national leaders. If these elite attitudes influence mass opinion, public support for integration would be negatively related to national economic conditions.

Three alternative hypotheses were clearly confirmed by the analysis: the economic perceptions hypothesis, the class-partisanship hypothesis, and the socialization hypothesis. Consistent with Dalton and Eichenberg's (1991) aggregate-level study, this analysis indicates that citizens’ utilitarian support is positively related to their perceptions of their personal and national economic conditions. Given the findings regarding objective economic conditions, this is a puzzling finding. Why do citizens increase their support for integration when they perceive that the economy has improved, but decrease their support when economic conditions have actually improved? One answer is that citizens, in forming evaluations of the national economy, consistently misperceive economic conditions. Alternatively, traditional measures of economic conditions—GDP, inflation, and unemployment—may not capture aspects of the economy relevant to citizens’ evaluations of economic conditions. The results also indicate that partisanship influences citizens’ support for integration. Although class partisanship does not account for the evidence in support of the policy appraisal model, class partisanship had both statistically and substantively significant effects on citizens’ support for integration in all the EU nations. This suggests that parties, through their positions on integration, influence how voters evaluate integration. In addition to this classpartisanship effect, a casual appraisal of the results for partisanship variables reported in appendix E suggests that support for integration also tends to be aligned along extremist–mainstream party lines, with mainstream party supporters more supportive of integration than supporters of extremist parties. This observation is consistent with the fact that most of the mainstream parties in the EU member states embrace European integration while opposition to integration tends to be from the far-left and far-right parties.

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CHAPTER 7 Conclusion My purpose in this book has been to explain how Europeans structure their attitudes toward European integration and why they vary in their support for integration. These issues are central to both measuring and understanding the process of European integration. One of the primary goals of interstate cooperation in Europe after World War II was to defuse nationalism by promoting a supranational allegiance among EU citizens. The integration of the EU member states’ economies and political authorities, while an impressive achievement in its own right, was designed as a means to transform public attitudes. Thus, public attitudes represent an indicator of the progress of European integration. In addition, mass attitudes, through their influence on political behavior, play an important—sometimes crucial—role in determining the content and scope of integration. Through channels of mass influence—for example, referenda, representative institutions, and protest—citizens affect EU policymaking and the success of integrative reforms. In the previous chapters, I developed and tested a theoretical explanation for public attitudes toward integration. The basic argument was that the economic consequences of European integration differentially influence citizens’ welfare depending on their economic and political interests. In turn, citizens vary in their support for integration consistent with their economic and political interests concerning integration. How do the differential welfare implications of integration connect to citizens’ support for integration? In chapter 2, I demonstrated that citizens structure their attitudes toward integration along a utilitarian dimension and an affective dimension. Utilitarian attitudes reflect citizens’ appraisals of the costs and benefits of integration and can change over time. This dimension provides a channel through which citizens’ considerations of the welfare implications of integration can influence their support for integration. In contrast, affective attitudes reflect an emotional or psychological attachment or allegiance to European integration that is generally stable over time. These two dimensions combine to influence citizens’ support for integration. Both affective allegiances to and utilitarian evaluations of integration are positively related to support for integration. When affective Page 110 → allegiances are high, utilitarian evaluations are weakly related to support for integration. However, when affective allegiances are low, utilitarian evaluations have a much stronger impact on support for integration. The empirical analysis in chapter 2 showed that the vast majority of EU citizens hold low levels of affective attachments to the European Union, and that this low level is stable over time. Thus, for most citizens, utilitarian evaluations are a significant determinant of support for integration. To understand variation in support for integration, we need to explain why citizens vary in their utilitarian evaluations of European integration. As I showed in chapters 3, 4, and 5, citizens’ economic and political interests regarding integrative policy account for variation in their utilitarian support for integration. In chapters 3 and 4, I used economic theory to identify which citizens’ interests are served by the primary aim of integrative policy: the liberalization of the EU market for goods, capital, labor, and services. In chapter 3, I focused on how market liberalization works to the advantage of skilled workers, the wealthy, and border residents at the expense of unskilled workers, the poor, and non-border residents. I then showed how variation in utilitarian support varies consistently with these occupation, education, income, and residence-based interests. In chapter 4, I discussed how market liberalization structures competition among skilled and unskilled workers. Among skilled workers, the internal market serves the interests of those with relatively high-value human capital. Among unskilled workers, the internal market works to the advantage of those with relatively low wages. Differences in utilitarian support within these two occupational groups are consistent with this distribution of economic benefits. Finally, I also showed that farmers, who receive direct financial subsidies from the European Union, differ in their utilitarian support consistent with the level of subsidies they receive from EU agricultural spending. In chapter 5, I focused on the consequences of market liberalization for the national political economy of the member states and how citizens differentially benefit from these consequences. First, trade liberalization is increasingly beneficial to national economies as dependence on trade grows and the trade balance improves. In

addition, through its contribution to economic growth, European integration has political implications for both the external security and the internal stability of the member states. European integration reduces the chance of war among the member states, and it contributes to the stability of democratic-capitalist regimes. To the extent citizens value these political outcomes, integration serves their political interests. The results of the empirical analysis demonstrated that citizens vary in their utilitarian support consistent with the national economic and political benefits they derive from integration. Page 111 → Finally, in chapter 6 I reexamined these explanations for utilitarian support in light of several contending theories of public support for European integration. The analysis revealed that the aforementioned relationships are robust in the presence of a variety of control variables and in different samples. In addition, the evidence indicates that several often-cited explanations of support for integration are dubious. In this concluding chapter, I will examine the implications of this study for our understanding of European integration and for research in several areas of political science. First, I will consider how my findings compare with previous research on public attitudes toward European integration. Second, I will discuss how this study contributes to our understanding of European integration. Third, I will apply the conclusions of this study to related questions in the study of international political economy and public opinion.

Reconsidering Public Opinion and European Integration This book offers six important contributions to the study of public attitudes toward European integration. First, the study shows that public attitudes toward integration incorporate more than superficial reactions to temporary shifts in domestic politics or the national economy. In spite of their general low level of public interest in and knowledge about European integration, citizens manage to evaluate integration consistent with the benefits they derive from integration. Indeed, the results of this study suggest that citizens’ attitudes reflect a rather sophisticated appreciation of the economic consequences of integration.1 Consequently, concerns that citizens’ disinterest impedes them from forming meaningful attitudes toward integration are unwarranted. Second, this study provides a theoretical explanation for variation in public support for integration that holds generally, independent of time and national context. None of the hypotheses applied exclusively to a particular nation or year. Thus, the theory provides the basis for inferences about citizen politics in the newer member states and in other years. It is important to note that the hypotheses generated from the theory were specific to the current status of European integration, which is primarily an internal market. However, at its most general level, the theory applies to other stages of integration, such as the Economic and Monetary Union. Adapting the theory to these settings requires only identifying whose interests are served by the new integrative policies. Third, this study resolves an important incongruence between the findings of past research and actual mass political behavior. As early as the 1970s, scholars interpreted survey evidence of widespread affective allegiances Page 112 → to the European Community as indicative of a “permissive consensus” in favor of further integration. This permissive consensus signified that, while the public may not be a strong catalyst and advocate for integration, it provides elites with an acquiescent public environment in which to pursue integrative reforms. Recent public opposition to European integration in national referenda, however, conflicted with this depiction of a permissive consensus. Has the permissive consensus recently eroded or did it never actually exist? The results of this study indicate that no permissive consensus existed well before the recent referenda. Survey evidence presented in chapter 2 showed that only a small portion of the public holds strong affective supranational attachments. Furthermore, this study indicates that the reason previous research erroneously identified a permissive consensus was that they used an inflated survey measure of affective support for integration. According to more accurate measures of affective support, the recent public opposition to integration is consistent with the actual level of public affective attachments to the European Union. Fourth, this study provides evidence as to the veracity of several extant explanations of public support for

integration. The most striking finding is that two of the most widely cited explanations of public support for integration—value orientation and cognitive mobilization—are not supported by the data analysis. In addition, the analysis showed a relationship between improving objective economic conditions and decreasing support, which is contrary to previous theorizing and empirical evidence. Why the unexpected results? Before suggesting an answer, it is important to note that the analysis did not, and was not intended to, thoroughly examine the alternative explanations. The purpose of including controls for these explanations was to ensure that they did not confound the hypothesized relationships. That being said, the results suggest that, instead of these extant explanations confounding my hypotheses, my hypotheses appear to have confounded these extant explanations. When variables representing both these alternative explanations and my hypotheses were analyzed together, the evidence did not support the alternative explanations. In addition, the only evidence supporting these alternative explanations is from analyses of very similar data but without controls for my hypotheses. Fifth, the results also support several alternative explanations for variation in support. Partisanship has an impact on support. All else equal, citizens tend to evaluate integration consistent with the position of their preferred party. Also, citizens’ subjective perceptions of the economy are positively related to their utilitarian support. Finally, the length of EU Page 113 → membership is positively related to support. This finding is consistent with the previous claims that, as a nation's membership lengthens, its citizens are increasingly socialized toward greater support for integration. Sixth, the empirical findings in chapter 2 have important implications for the application of the Eastonian model of public support to the study of public attitudes toward European integration. Much previous research on public support for integration has adopted the Eastonian model without verifying its applicability to the EU context. Scholars had not demonstrated that citizens structure their attitudes toward integration along utilitarian and affective dimensions and that attitudes on these dimensions are related to support for integration. The results of the analysis show that the Eastonian model is applicable to the EU context. Citizens’ support for integration is based on these dimensions, and these dimensions interact to influence support. Thus, one should not infer the level of support for integration with only knowledge of one dimension. A citizen with low affect-based support may express strong support for integration based on utilitarian considerations. A citizen with low utility-based support may be a strong supporter of integration based on positive affective attachments to the European Union. Finally, the findings inform future research on public attitudes toward European integration. The policy appraisal model could be expanded by examining additional policy implications of European integration. For example, due to data limitations, this study did not consider how the distribution of EU financial resources to underdeveloped regions and various agricultural and fishing activities influences utilitarian evaluations. By incorporating additional consequences of EU policy, future research could develop a more comprehensive model of how citizens’ interests regarding integration relate to their support for integration. Another important direction for future research is to investigate the sources of variation in affective attitudes toward integration and their relationship with utilitarian support. This study ignored the question of why affective attitudes are generally low and how they might change. These are important questions for comprehensively understanding the dynamics of public support for integration. Caldeira and Gibson (1995) provide an important basis for such a study. They examined differences in EU citizens’ affective sentiments toward the European Court of Justice. Their findings and analytic framework could be applied to affective sentiments toward the European Union more generally. In addition, due to data limitations, I was unable to examine the dynamic relationship between utilitarian and affective support for integration. Theoretically, if a citizen experiences continued benefits from integration, she should maintain high Page 114 → utilitarian support and develop affective support. This is a difficult hypothesis to examine because it requires panel data. However, some related research is encouraging. Research that has tested this hypothesis in the context of public attitudes toward the U.S. Supreme Court provides corroborative evidence (Hoekstra 1995; Mondak 1992).

Implications for the Study of European Integration The most important contribution of this research for understanding European integration is that it demonstrates

that citizens’ attitudes toward integration vary systematically according to their economic and political interests. In so doing, the findings of this book demonstrate that mass attitudes toward integration, and the related political behavior, deserve attention in the study of European integration. This is a fundamental challenge to a great deal of research on European integration. Much of the previous research on European integration has focused on the role of elites (e.g., national politicians and parties), interstate relations, and institutions (e.g., the European Commission) while largely ignoring mass attitudes and behavior. Even when public opinion was demonstrably relevant to integration, scholars often depicted it as an artifact of partisan politics. For example, some scholars contend that public opposition to the Maastricht Treaty largely reflected national partisan politics (Franklin, Marsh, and McLaren 1994). This focus on political elites to the exclusion of public opinion is justified if either public attitudes are unstructured and random or if they are simply a reflection of the attitudes of politicians that decide integrative policy. If attitudes are unstructured and random, then their variation would be impossible to predict and explain. Consequently, public opinion might influence integration, but attempts to explain or interpret this influence would be futile. And if public opinion simply echoes the opinion of policymakers, then public opinion adds nothing to our understanding of EU policy-making or the integration process beyond the study of elites. The results of this study indicate that public opinion is neither random nor simply driven by partisan politics. Variation in citizens’ attitudes toward integration follow systematic patterns for which the theory in this book provides an explanation. And these patterns are not merely the result of party politics. Clearly, as shown in chapter 6, partisanship has a significant impact on citizens’ attitudes. But independent of partisan attachments, citizens vary in their support for integration consistent with their economic and political interests related to integration. Thus, mass attitudes, and the related political behavior, represent an independent and systematic component of the integration process. Page 115 → Economic Integration and Public Support By identifying a systematic component to the public constraint on integration, the policy appraisal model informs our understanding of the process of European integration in a variety of ways. The most obvious implication is that the future of integration will depend, at least in part, on how well integrative steps provide tangible benefits for EU citizens. More specifically, the policy appraisal model indicates that the success of future integrative reforms depends on the microeconomic consequences of European integration. This is an important insight. European integration and the internal market in particular have been promoted predominantly on their macro-economic merits, that is, EU-wide growth in GNP and employment.2 The results of this analysis indicate that such macroeconomic outcomes do not necessarily secure widespread public support. EU citizens appear to evaluate integration based on the distribution of aggregate benefits. Consequently, EU GDP growth that serves only a minority of citizens’ economic interests could lead to a decrease in overall public support for integration. In other words, aggregate EU-level economic benefits are not necessarily associated with EU-wide increases in public support. This conclusion has an important implication for advocates and designers of further economic integration: in order to secure public support for future integration, they should pay attention to the balance of economic “winners” and “losers” from integrative policy. One should not assume that those citizens whose economic interests are damaged by integrative proposals will remain politically silent. This is apparent in public opposition to the current transition toward Economic and Monetary Union (EMU). As part of the transition to EMU, national governments must maintain low budget deficits, public debt, low inflation, and monetary stability. In pursuit of these goals, national governments have cut spending, causing layoffs, factory closings, and reduced welfare programs. The public's reaction has been consistent with the theory developed in this book: those whose economic interests are damaged by this policy oppose the policy. Workers and organized labor adversely influenced by these programs have called strikes and organized public protests against EMU.3 In order to gain their support, EMU needs to include

compensation for their economic losses. For example, a spokesman for the European Trade Union Confederation stated that, “We are still in favor of monetary union but it must be complemented by other elements, including measures at the European level to promote employment.”4 The general point is that policies that correct for adjustment or relocation costs associated with economic integration are of important political Page 116 → value for maintaining public support for integration. To some extent, EU policymakers have recognized the need to compensate citizens who are economically disadvantaged by integration. The EU's structural funds—consisting of the European Regional Development Fund, the European Social Fund, and the guidance section of the European Agricultural Guarantee and Guidance Fund (EAGGF)—finance investment in economically underdeveloped and declining regions, combat long-term unemployment, and assist the integration of the young into the labor market. However, since these redistributive policies are largely region-based, they may not directly address the concerns of EU citizens disadvantaged by market liberalization. In particular, the existing compensation funds do not address the negative impact of integrative policies on citizens who depend on government welfare programs or employment protection. To compensate these citizens, the European Union would need a more comprehensive welfare policy. The Social Policy Agreement, adopted by all EU members except the United Kingdom, provides the first step in this direction. It lays the groundwork for defining minimum standards for working conditions and social benefits for EU workers. As the EU market increasingly integrates, these types of EU-level welfare policies may be necessary to attract and maintain the political support of those citizens whose economic interests are damaged by integration. Also, citizens adversely affected by market integration are likely to demand compensation and protection through EU legislation. The impact on EU policy-making of public demands for protection from market liberalization is already evident. Recent directives based on the Social Policy Agreement demonstrate that citizens’ interests, as represented by interest groups, have shaped EU policy-making so as to supplement the internal market with social safeguards against the adverse effects of market liberalization. The Social Protocol, annexed to the Maastricht Treaty, formally includes the “social partners”—transnational organizations representing employers, trade unions, and public enterprises—in the formation of EU social policy. As the results of this study would predict, those segments of society harmed by the internal market (such as trade unions representing unskilled workers) have used this forum to promote social legislation that protects wages and workers’ benefits. The result has been the adoption of two directives. The parental leave directive guarantees parental leave from work to care for a child for at least three months. The posted workers directive protects domestic workers against competition on wages and benefits from temporary workers from other EU member states.5 These directives clearly address the economic costs of integration endured by unskilled workers due to market liberalization. As Briggitte Page 117 → Langehangen, German member of the European Parliament, stated in response to the directive on posted workers, “German workers in the building sector can ‘breathe’ at last, having been penalized by the presence of rivals from other EU countries who at times work in Germany for a third of the wages set in the country by the social partners.”6 Consistent with the implications of this study, these directives demonstrate how public attitudes translated into political behavior at the supranational level shape the form of integrative policy and the extent of economic integration. The Future of Social Integration This study also has implications for integration theorists and politicians interested in social integration. One of the original motivations for European cooperation was a desire to institutionalize links between states in order to defuse the destructive nationalism that led to two world wars. The hope was that the creation of a European Union would attract public loyalties to a supranational identity. In addition, many scholars and functionalist theorists argue that an affective sense of community among EU citizens is necessary for supranational governance and future integration (Cohen 1994; Smith 1993; Shephard 1975, 45). Has the development of the European Union

precipitated such a social integration? Based on the results from this study, the answer is no. The evidence from chapter 2 regarding affective sentiments toward integration indicate that only a small portion of the EU public holds a strong allegiance to the European Union or is willing to make sacrifices for citizens of other member states. Thus, while the level of supranational economic and political cooperation has grown impressively over the last 40 years, European integration as indicated by public attitudes is far from complete. In addition, this study identifies some potential sources of future social integration that may promote a supranational community. According to Putnam (1983, 89), social integration entails a decline in the salience of territorially defined interests on European issues in favor of pan-European concerns. In other words, the EU polity needs social cleavages that cut across nations. A fully integrated European public might evaluate EU policy based on factors that transcend national boundaries such as class, gender, age, and ideology. The results of this study suggest that such transnational factors exist in the European Union. For example, across nations, citizens appear to share political interests concerning integration based on their income. Such common economic interests could serve as the basis for transnational political identities. Why have these transnational social cleavages not emerged? One important reason these concerns have failed to promote transnational Page 118 → affiliations is that most of the political institutions that mediate between citizens and EU policymakers are nationally defined. In general, national governments ultimately decided all EU legislation,7 policy implementation is administered by national officials, and the policy-making agenda is significantly shaped by national governments.8 Political intermediary institutions, such as political parties and interest groups, are also defined predominantly along national lines. While EU “party groups” exist, citizens’ partisanship remains with national parties. These transnational party groups appear to structure the voting behavior of members of the European Parliament (EP), but they have little impact in the electorate.9 Voters do not demonstrate cross-national political identities with these party groups. In EP elections, citizens predominantly vote for national, rather than transnational, parties, and their votes appear to be dominated by national political issues (Eijk and Franklin 1995; Reif and Schmitt 1980). Consequently, while “European” parties exist, their constituents lack supranational partisan allegiances. Similarly, although transnational interest groups participate in EU policy-making, they work predominantly as brokers for national interest groups to which citizens are affiliated. Mazey and Richardson (1993b) and Greenwood and Ronit (1994) point out that many national interest groups increasingly focus their resources on Brussels rather than their national capitals. Furthermore, these groups have developed transnational “federations” to coordinate policy demands (Mazey and Richardson 1994). However, the development of these federations does not indicate that citizens—or interest group leaders for that matter—have cross-national political allegiances or identities. Furthermore, national interest groups continue to lobby actively on EU policy independent from their transnational affiliations. This is a consequence of the fact that national ministers and administrators remain the central intermediaries between interest groups and the European Union (Mazey and Richardson 1993a). This impedes the development of EU social integration. Consequently, social integration could be encouraged through reforms directed at modifying the political institutions that mediate between citizens and EU policymakers. One option would be to replace national governments’ formal influence on decision making with that of transnational institutions such as the European Parliament. This could be accomplished by shifting the decision-making power in the European Union from the Council of Ministers to the European Parliament. However, such a reform is unrealistic given that it requires the approval of national governments. A more realistic reform would be to endow the European Parliament Page 119 → with the power to initiate legislation. Members of the European Parliament are directly elected by the EU public and therefore are responsible to their constituents and not necessarily to their national governments. Furthermore, the institutional rules of the European Parliament encourage the formation of transnational parties that could represent transnational interests.10 If the European Parliament had a formal power to initiate legislation, this would encourage transnational coalitions of Europeans to form in order to lobby the EP agenda.11 For example,

transnational political interests concerned about reductions in the welfare state due to integration might coalesce in order to promote the creation of compensatory EU welfare policies. In this way, pan-European concerns would be granted institutional access to the EU legislative process. If these pan-European concerns successfully attracted public allegiances, then citizens might begin to define their interests on EU issues according to these transnational identities. In this way, the institutional reform may elicit the supranational allegiances that Putnam (1983) described. Political Cleavages and Partisan Politics in the European Parliament In the introduction to this book, I noted that recent and proposed reforms of the European Union have important implications for how mass politics shape EU policy-making. In particular, the increasingly important legislative role of the European Parliament provides an entry point for public concerns into the legislative process. Depending on how voters respond to the EP's increased legislative powers, these reforms may transform partisan politics in the European Parliament. The findings of this study have implications for our understanding of how strengthening the power of the European Parliament will influence the character of party politics in the European Parliament. In most parliamentary democracies, the legislative party system is built on the social cleavage structure of the electorate, and legislative parties represent different constituents’ interests along these cleavages. However, in the European Parliament, the party system lacks clear socioeconomic foundations (Attina 1990, 576). A major reason for this is that, until recently, there has been no electoral connection between voters’ interests and their representatives in the European Parliament. EP elections have been characterized as “second order” national elections where EU issues are subordinated to national party competition (Eijk and Franklin 1995; Reif and Schmitt 1980). This is hardly surprising, since votes in EP elections had little if any consequences for EU policymaking due to the legislative impotence of the European Parliament. Page 120 → However, recent and proposed reforms of the European Union significantly increase the legislative power of the European Parliament. For a vast array of legislation, the European Parliament can now exercise “conditional” agenda-setting power or a veto (Tsebelis 1994). Also, almost all current reform proposals for the European Union entail a further increase in the EP's legislative power. Consequently, EP elections are now—and should become more—consequential for voters interested in EU policy. This should increase the relevance of EU issues in EP elections and promote an electoral connection between citizens’ attitudes toward EU politics and their representatives’ behavior in the European Parliament. In turn, social divisions concerning EU politics should increasingly determine the structure of party politics in the European Parliament. The findings of this study offer an important insight into how party politics in the European Parliament may change as a result of an increasing electoral connection between social divisions regarding integration and the EP party system. Currently, EP party politics is organized according to party groups that generally include members from several national parties of the same political “family” (Corbett, Jacobs, and Shackleton 1995). This consists of national parties from the Left coalescing in parties such as the Party of European Socialists while national parties from the Right coalesce in parties such as the European People's Party. This left–right cleavage corresponds to the traditional class-based cleavage in the national setting. The results of this study suggest that this traditional class-based economic cleavage may not be salient at the European level. In the party systems in the EU member states, Left parties draw their political support largely from unskilled workers because these parties advocate working-class interests (Gallagher, Laver, and Mair 1992, 176; Dalton 1988, 155). The results of chapter 4 indicate that Left party groups at the EU level may find it difficult to serve the same role. Unskilled workers vary in their evaluations of integration depending on their wages. Unskilled workers with relatively low wages have expanded occupational opportunities due to integration and express greater support for integration than those with high wages, who experience greater occupational competition due to integration. Thus, low- and high-wage unskilled workers have divergent economic interests and attitudes concerning market

liberalization, which is a primary component of European integration. Consequently, members of the European Parliament (MEPs) elected from Left parties in nations with relatively low-wage unskilled labor are accountable to different economic interests for their electoral survival than MEPs from Left parties in nations with relatively high-wage unskilled workers. This may make it difficult for an EP Left party group to adopt common positions or organize voting behavior on issues related to economic Page 121 → integration. On issues such as liberalization of labor and capital markets, MEPs representing low-wage unskilled labor would support further liberalization while MEPs representing high-wage unskilled labor would not. Indeed, on these issues MEPs representing low-wage unskilled labor would share economic interests with MEPs representing the interests of financial capital. Thus, the heterogeneity of economic interests among the Left parties’ constituents could undermine cohesion in party groups such as the Party of European Socialists. In other words, the results of this study suggest that the socioeconomic foundations for an EP party system do not support the traditionally defined left–right dimension of party competition. This conclusion supports Bardi's (1994) argument that the current EP party system is artificial and the cohesiveness of party groups is fragile. Institutional Reform and the “Democratic Deficit” The European Union is currently considering reforms of its institutions in order to remedy its “democratic deficit.” This refers to the reduced public participation in and control over policy that resulted from moving political authority from the national to the supranational level. The members of the Commission and the Council of Ministers—the dominant institutions in the EU legislative process—are not elected, and their legislative deliberations are often formally and informally removed from public and parliamentary debate. In response to these concerns, most reform proposals recommend enhancing the power of the European Parliament, which is the only directly elected EU institution. Proposals to “democratize” the European Union share three demands: an EP veto over all legislation; an EP power to initiate legislation; and majority voting in the Council of Ministers on all legislation. As discussed in the introduction, the viability of such reforms depends in great part on the structure of political attitudes and interests toward integration. A large body of research has demonstrated that majoritarian democratic institutions, such as those proposed, can prove unstable exactly because they increase public participation in and control over policy-making (Lijphart 1996; Dahl 1989, 254; Lijphart 1977). The stability of democratic institutions depends on the cleavage structure of the polity as well as the institutional channels for public participation (Lijphart 1977). In a society where citizens associate their political interests with different groups of people on different issues (crosscutting cleavages), majoritarian parliamentary institutions are generally stable. In contrast, these institutions are often unstable in societies where citizens associate their political interests with the same group of people on most or Page 122 → all issues (reinforcing cleavages). Applied to the European Union, these conclusions suggest that reforms designed to reduce the democratic deficit may destabilize the EU political system. This is a serious concern, since one of the motivations for reducing the democratic deficit is to promote a public legitimacy and stability for the European Union. Thus, depending on the cleavage structure of the European Union, these reforms could have important unintended consequences. Is the EU cleavage structure appropriate for the proposed reforms? Based on the evidence from this study, the answer is no. EU citizens appear to share income- and some occupation-based economic interests regarding integration. Thus, there are issues on which crosscutting cleavages could develop. However, cleavages consist of more than common interests; cleavages require that citizens be conscious of their collective identity (Gallagher, Laver, and Mair 1995: 210). In this regard, EU transnational cleavages are nascent, at best. Transnational political institutions (parties and interest groups) that define and represent transnational interests at the European level are only now developing. EU citizens continue to identify with and have their interests represented predominantly by national (and subnational) political organizations. Thus, while the basis for crosscutting cleavages exists, the organization of interest representation in the European Union maintains a structure of reinforcing cleavages along national lines. The lack of appropriate cleavages does not rule out all reforms of the European Union designed to democratize

EU policy-making. A more moderate reform of the European Union that promotes transnational interest groups and parties could lay the groundwork for a successful later transformation of the European Union into a stable majoritarian parliamentary political system. The reform proposal described in “The Future of Social Integration” is an example of one such reform. But a dramatic increase in public participation in EU policy-making may prove to defeat the goal of the reforms: it may actually destabilize the EU political system. The prospects for stable majoritarian democratic government with strong public participation are poor where cleavages are reinforcing as in the European Union.

Implications for the Study of Public Opinion The results of this study are of interest to the current debate on the consistency of public opinion and the formation of public attitudes. On the one hand, some scholars argue that the public does not have well-behaved and consistent beliefs, particularly on foreign policy issues (Rosenau 1961; Converse 1964; Neuman 1986). These scholars argue that foreign policy Page 123 → issues are so complex and removed from the common citizen's experiences that they are beyond her comprehension (see Almond 1950; Friedrich 1950; Rosenau 1961). Thus, we should expect public opinion on international affairs to be volatile and incoherent (Nincic 1992, 773). On the other hand, recent research finds that, in spite of its low level of sophistication, the American public is able to form consistent opinions with limited information (Page and Shapiro 1992; Russett 1990; Wittkopf 1990; Hurwitz and Peffley 1987). This book is relevant to this debate. In chapters 3 through 6, I examined the consistency of EU citizens’ attitudes with their economic and political interests on an international policy issue—European integration. The evidence lends support to the contention that attitudes on international policy are consistent. Furthermore, this evidence is valuable because it is based on public opinion from twelve different European nations. Most previous studies of the consistency of public attitudes rely exclusively on American public opinion. It is also worth noting that the primary finding of this study, that citizens’ attitudes toward integration are structured by their personal utilitarian concerns over integrative policy, is a rare finding in public opinion research. Personal material self-interest, as a source of variation in public opinion, has generally been undetected in previous studies of public opinion (Sears and Funk 1990; Kinder 1983, 404; but see Brady and Ansolabehere 1989). As Kinder and Kiewiet (1979, 523) argued, “Private economic experience is important, but not for politics. Economic discontents and political judgements inhabit separate mental domains.” Consequently, the evidence that citizens form attitudes toward integration consistent with their economic interests challenges some conventional wisdom about public opinion. Finally, my evidence of consistent public attitudes toward integration begs an important question for further research: How do EU citizens form consistent attitudes toward integration? In this study I offered theoretical arguments for how citizens connect their economic and political interests from integration with their support for integration. However, I did not directly test any of these arguments. Further empirical research on this process of opinion formation may have implications for better understanding variation in public attitudes toward integration. Recent research offers several potential approaches to the question of opinion formation. Studies of public opinion in the United States indicate that citizens form political attitudes differently depending on their level of political sophistication, their access to information, their social context, and the content of media information to which they are exposed (Mutz 1994; Zaller 1992; Huckfeldt and Sprague 1987; Stimson 1975). Of this literature, Page 124 → the work of Mutz (1994) is directly relevant to this study because it examined how self-interest influences political attitudes. According to Mutz, the media play an important role in determining whether citizens adopt attitudes reflecting their self-interest. The media could play at least two possible roles. The media could act as a “facilitator,” providing citizens with information about the relevance of their self-interest to political issues. According to this perspective, citizens who are exposed to media information and who can process that information should form political attitudes consistent with their self-interest. Citizens lacking media exposure or the ability to process

media information should not form self-interested attitudes. Alternatively, the media could act as an “inhibitor” to self-interested attitudes. This contention is based on the assumption that, in the absence of alternative sources of information, citizens rely on their personal experiences to evaluate policies or candidates (Mutz 1994, 691). Citizens who can process media information and who are exposed to media information will form political attitudes that reflect social or national referents. Citizens lacking these characteristics will “default” to their personal experience in assessing policies or candidates and therefore adopt self-interested attitudes. These two approaches provide explanations—albeit conflicting ones—about which citizens form attitudes toward integration that reflect their interests. Consequently, the theory developed in this book may be more applicable to certain portions of the EU public than to others, depending on the informational environment. Three characteristics of a citizen's informational environment are particularly important: her ability to process media information, her exposure to media information, and the content of the information. Research examining how the informational environment influences attitudes toward integration could enrich our understanding of public support for integration. In addition, testing these two approaches in the EU context would contribute evidence toward reconciling their conflicting hypotheses.

Implications for the Study of International Political Economy Finally, the results of this study have important implications for the study of international political economy. Over the past twenty years, scholars have proposed a variety of theories to explain the “second image” of international political economy: how domestic political forces influence international economics. Applied to democracies, these theories differ fundamentally in their treatment of the mass public. One branch of research focuses on interest groups and ignores the public by assuming that citizens are Page 125 → insufficiently informed about international economics to identify their economic interests and hold politicians electorally accountable for international economic policy (e.g., Magee, Brock, and Young 1989). Another branch of research adopts what Katzenstein (1978, 18) calls the “democratic” model. This research models the public as the primary constraint on policymakers by assuming citizens can vote their economic interests regarding international economic policy and therefore electorally punish or reward politicians for the policies they adopt (e.g., Mayer 1984; Cassing, McKeown, and Ochs 1986). Due to this theoretical distinction, these two models provide conflicting predictions and interpretations regarding the influence of domestic politics on international economic policy-making. The results of this study support the “democratic” model of domestic influence on international economic policymaking. EU citizens adopt attitudes toward integration—which represents an international economic policy—that are consistent with their economic interests related to integration. This supports the assumption in the “democratic” model that voters form attitudes consistent with their economic interests on international economic policy. However, the existence of an electoral constraint does not eliminate or replace the influence of interest groups on policymakers. Due to problems of collective action, not all citizens’ interests are equally represented through interest groups. Thus, a more appropriate model of the “second image” should incorporate both interest groups and the electorate. Also, the findings of this study provide evidence to support the assumption underlying previous research concerning how international economics influences domestic politics—the “second image reversed.” As mentioned in the introduction of this book, several studies have shown that international economics significantly shape domestic politics through their impact on the economic interests of different segments of society (Eichengreen and Frieden 1994; Frieden 1991; Rogowski 1989; Gourevitch 1986). These studies used international economic theory to identify the distribution across society of economic benefits and costs from changes in international economic conditions. They then demonstrated how, based on this distribution, the affected segments of society responded politically in a fashion consistent with their economic interests. Implicit in this research is an assumption that citizens in these different segments of society adopt political attitudes and behavior consistent with their economic interests related to international economic policy. This study provides evidence supporting this assumption. Based on economic theories regarding the distribution of benefits from

European integration, I identified those segments of society that benefit and lose from integration. I then demonstrated that citizens adopt attitudes toward integration consistent with their economic interests concerning integration.

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Appendixes

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Appendix A

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Appendix B Page 131 → Page 132 → Page 133 → Page 134 → Page 135 → Page 136 → Page 137 → Page 138 → Page 139 → Page 140 → Page 141 →

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Appendix C This appendix describes the coding of the independent variables for chapter 4: Relative human capital (professional). This is an interaction term constructed by multiplying a respondent's score on the occupational dummy variable for “professional” by his relative income in 1990 US dollars according to purchasing power parities (PPPs). The mean income for all professionals from the respondent's survey is then subtracted from his relative income. Thus, the final adjusted income represents a wage relative to other professionals in that survey. The coding of relative income is as follows. In most nations, income levels were divided into 12 categories identified by a range of income. For each range, I took the average value and multiplied it by the PPP (in 1990 $US) for that nation. The highest income category was open-ended so for these categories I took the range of the preceding category and added that to the final category's floor value. For example, if the last two categories for Italy were (a) 200,000– 250,000 lira and (b) 250,000 lira or more, I would set the income for category (a) to 225,000 lira and the income for category (b) equal to 300,000 lira. The source of PPPs used in this analysis is the Organization for Economic Cooperation and Development National Accounts: Main Aggregates 1960–1991, 157. Relative human capital (executive). This interaction term was constructed in the same way as Relative human capital (professional) except the occupational dummy variable for “executive” was multiplied by the respondent's adjusted income. For a discussion of how the relative incomes are calculated and then adjusted to the mean for each survey, see the description of the previous variable. Relative wages. This interaction term was constructed in the same way as Relative human capital (professional) except the occupational dummy variable for “manual worker” was multiplied by the respondent's adjusted income and income was adjusted by exchange rates. For a discussion of how the relative incomes are calculated and the adjusted to the mean for each survey, see the description of Relative human capital (professional).

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Appendix D Partisan Opposition to Democratic Capitalism I identified two types of parties as opposed to democratic capitalism. First, I included all communist parties and related parties in Ireland (Workers Party), Greece (Coalition of Left), Portugal (United Democratic Left), Italy (Proletarian Union, Continuous Struggle, Workers Vanguard), and Spain (United Left). I did not include the KKE (interior) in Greece. Second, I included extreme right-wing parties (ERPs) that were anti-democratic. Ignazi and Ysmal (1992) provide the following list of such ERPs in the EU member states. Note that many of these parties attract votes for other reasons than electoral opposition to democratic capitalism. Thus, the electoral performance of parties that are predominantly attracting voters for their stance on other issues, such as immigration, serves as a poor measure of opposition to democratic capitalism. Based on this concern, I excluded the Vlaamsbloc in Belgium and the Center Democrats in the Netherlands and the FRP in Denmark from the “opposition” parties. Neither party espouses a clear opposition to democracy, and they emphasize other issues (Mudde 1994). Note that Mudde (1994, 214) makes a distinction between ERPs that are antidemocractic with and without an alternative vision. For the purposes of this analysis, I am only interested in whether the party elicits votes due to its antisystem orientation. Thus, whether the party espouses an alternative vision is not pertinent to this analysis. Page 144 → It is also worth noting that regional parties often threaten the stability of the national governing institutions but are not included in this analysis. These parties are not included in the “opposition” category because, while they may serve as a proxy for opposition to the ruling regime, European integration does not help the regime withstand separatist opposition. The political stability hypothesis contends that economic integration helps a regime redress its citizens’ economic concerns, thereby reducing opposition to the regime. Economic integration does not, however, help a regime respond to ethnically or linguistically based opposition to territorial boundaries or centralized government. Consequently, I would not expect citizens’ attitudes toward integration to reflect their perceptions of threat to the regime from separatists.

Diagnostics from the Regression Analyses in Chapter 5 and Chapter 6 Page 145 →

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Appendix E This appendix presents the parameter estimates for the party variables included in the regression in model 2 of table 19. I separated respondents according to political affiliation by their responses to a Eurobarometer question asking vote intention if a general election were held tomorrow. The party variables included in the tables are listed roughly from ideological left to right as organized in the Eurobarometer. A few general comments regarding the results are warranted. First, it is interesting to note that in addition to the class partisanship effect there appears to be an extremist/mainstream partisanship effect, with the least support for integration found among supporters of far right and far left parties. Of course, this is only a preliminary observation and a full investigation of this relationship would require careful attention to definitions of “extreme” and “mainstream” and the development of a theoretical explanation for such a partisan influence on support for integration. Second, the results for the occupation, income, and education variables are generally unaffected by the inclusion of the party variables. Thus, the human capital and income hypotheses remain supported by the survey data. Page 147 → Page 148 → Page 149 →

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Appendix F This appendix reports descriptive statistics for the economic control variables included in the regression presented in table 21.

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Notes Chapter 1 1. Illustrating this argument, Jean Monnet described the Schuman Plan for the European Coal and Steel Community to national governments during its negotiations in the following terms: “The Schuman proposals provide a basis for the building of a new Europe through concrete achievements of a supranational regime within a limited but controlling area of economic effort” (Nugent 1994, 39). 2. At the same time, these nations also formed the European Atomic Energy Community (EURATOM). EURATOM, the ECSC, and the EEC are referred to collectively as the European Communities (EC). 3. This passage is a stated goal in the Single European Act (1987) and Treaty on European Union (1992). 4. Watson, Rory, “Another Own Goal,” The European, April 8, 1993, 1. 5. Andrew Fisher, “Bonn Pushes EU Budget Reform,” Financial Times, April 6, 1995. 6. Indeed, Deutsch (1957) considered the development of a “sense of community” as a precondition for successful integration. 7. On this definition of legitimacy, see Jackman 1994. 8. See Kornberg and Clark 1994, 19, for a discussion of the general importance of public allegiances to government stability in democracies. 9. For example, Cohen (1994, 159) argues that a sense of community and solidarity are necessary for sustaining economic and monetary union. 10. See, for example, the European Parliament Resolution, November 27, 1989 (the Interim Report, rapporteur David Martin). 11. For examples of the deleterious effect of reinforcing cleavages on party politics see Lipset 1980, chapter 3. 12. For a discussion of these explanations, see Brule 1992 and Franklin, Marsh, and McLaren 1994. 13. Dalton and Eichenberg posit an individual-level relationship between economic perceptions and support for integration. They tested this hypothesis by aggregating public economic perceptions and support for integration at the national level and examining the relationship. The results from their analysis indicated that a full swing from worst to best economic perceptions never accounts for more than one percentage point change in support. Although this result is statistically significant, the impact of economic voting at the aggregate level appears to be Page 152 → substantively quite small. I will examine their theory at the individual level in chapter 6. 14. For example, the question “are you in favor of the unification of Western Europe?” is commonly used as an indicator of public support for integration. The vagueness of the question is potentially problematic. A respondent could be in favor of unification conceptually but opposed to it in practice. By using such questions, previous studies may not have evaluated the empirical validity of the aforementioned theories. 15. This is particularly important because sometimes multiple theories offer explanations for the same evidence. For instance, younger citizens may be more supportive of integration than older citizens because they have postmaterialist values and/or because they have higher levels of cognitive mobilization. Without controlling for alternative explanations, it is impossible to test accurately these different theoretical claims. 16. On the level of public awareness and interest regarding European integration in the 1970s, see Slater 1983. For more recent evidence, see Eurobarometer surveys conducted by the European Commission. For example, in 1993 (Eurobarometer 40), only 27 percent of the public felt well informed about the European Community (EC) and 57 percent were not interested in EC affairs.

Chapter 2 1. See Choper 1980 and Mondak 1992 for use of this conceptualization of “political capital” in the context of the United States Supreme Court. 2. Previous research has assumed that particular survey questions are appropriate measures of the affective and utilitarian dimensions of public support. The question “Are you in favor of efforts to unify Western

Europe?” is used frequently to measure affective support while the question “Do you think that your nation's EC membership is a good/bad thing?” is considered a measure of utilitarian support (Inglehart, Rabier, and Reif 1991; Slater 1983; Handley 1981). 3. Hewstone (1986) and Wildgen and Feld (1976) have conducted analyses of the underlying dimensions of public attitudes toward the EC. Hewstone used an exploratory factor analysis to investigate which aspects of the EC were important to different national publics. Although the analysis included groups of questions related to utilitarian and affective support, it did not explore the complete structure of public attitudes. Hewstone was only concerned with the dominant dimension of support. Wildgen and Feld more explicitly explored the existence of affective and utilitarian dimensions of support. However, their factor analysis included questions that concerned institutional rather than affective support. This shortcoming was recognized by the authors (80). In addition, the analysis included data from only four nations and the methodology employed did not permit a direct test of the Eastonian theory. For example, the factors were not rotated obliquely. 4. Gibson and Caldeira (1995, 460) summarize this debate about the connection between legitimacy and compliance and the related empirical evidence. 5. The Eurobarometer data were originally collected by Jacques-Rene Rabier, Page 153 → Helene Riffault, and Ronald Inglehart and made available by the Inter-University Consortium for Political and Social Research. Neither the collectors of the data nor the Consortium bear any responsibility for the interpretations presented here. 6. The two underlying dimensions are assumed to be oblique (correlated). 7. National weights were used to give a representative sample. The weighting is provided with the Eurobarometer data and corrects for sampling error. 8. I used the computer program EQS version 3.0a, by Peter M. Bentler, to estimate the factor structures. The results presented are not unique to EQS. EQS and LISREL produce essentially identical maximum likelihood estimates. 9. This is important because Europeans who support integration in a particular policy area may differ in their preferred actualization of that policy. Some citizens, for example, may favor a common EU defense but differ in how the defense organization should be linked to NATO. For this measure of support for actual integration, I am only interested in respondents’ attitudes toward the integrative policy as a general goal. 10. In calculating the correlations, national weights were applied to all observations so as to provide a representative sample of the EC population. 11. In addition, an identical analysis was conducted that included all responses of “don't know” to Evaluation of Membership. These responses were coded as the “neither good nor bad” category. The results were very similar to those presented here. 12. The correlation is a Pearson correlation coefficient for 584 observations. 13. The correlation is a Pearson correlation coefficient for 1250 observations. 14. It is unlikely that, by using European Unification to differentiate respondents, citizens with strong affective attachments have been left out of this group. 15. Based on face validity and the confirmatory factor analysis, I expect these two questions to reflect affective attitudes and not utilitarian attitudes. As such, they are useful tools for differentiating EU citizens according to their affective supranational allegiance. 16. I chose this survey because it included all three questions. The total percentages for the entire EU reflect weighted samples from each nation based on population. This gives a more accurate indication of the portion of the respondents in the EU who responded in each category than a simple summing of the national samples. The national weights are provided in the Eurobarometer. 17. Over two-thirds of respondents stated that they “never think of themselves as a citizens of Europe.” 18. A similar analysis with the question Solidarity was not possible due to data limitations.

Chapter 3 1. Dalton and Eichenberg (1991) and Eichenberg and Dalton (1993) measured a nation's EC support by subtracting the percent of respondents believing their nation's EC membership is a “bad thing” from the

percent who believe it is a “good thing.” The results of their analysis (Dalton and Eichenberg 1991) indicated that the increase in public support for integration associated with a complete swing Page 154 → (from worse to better) in a national public's aggregate economic perceptions is never more than one percentage point. Thus, the substantive significance of this variable is small. 2. This question was asked in Eurobarometer 22 (October 1984). 3. On the level of public awareness and interest regarding European integration in the 1970s, see Slater 1983. For more recent evidence, see Eurobarometer surveys conducted by the European Commission. For example, in 1993 (Eurobarometer 40), only 27 percent of the public felt well informed about the European Community (EC) and 57 percent were not interested in EC affairs. 4. Commission v. Belgium, May 26, 1982. 5. I refer to Directive 64/221 (February 25, 1964) and the following ECJ cases: Bonsignore Case (January 26, 1975), the Watson and Belmann Case (July 7, 1976), and the Adoui and Cornuaille Case (May 10, 1982). 6. The formulation of this legislation was no small task, requiring over 17 years to conclude. It is important to note that these EU labor provisions were not applicable between Portugal and Spain and the other EU members until 1995 (1996 for Luxembourg) as part of Portugal and Spain's transition period for membership (Guery 1991, 95). 7. One obvious implication of liberalization of the labor market is that it increases competition for jobs by increasing the pool of potential applicants. Integration also increases the number of EU citizens who face this competition by reducing traditional sources of job security. In most EU member states, governments have traditionally participated in the private sector either directly through government ownership or indirectly through supportive subsidies or trade protection. In some cases, these government policies have been instrumental in avoiding layoffs or complete failure by unprofitable firms. The EU's elimination of barriers to trade has dismantled most inter-EU protectionist policies and the EU's Competition Policy has limited government subsidies to firms. Consequently, some traditional sources of job security have been reduced or eliminated by EU policy. This should translate into higher volatility in the job market as layoffs and downsizing, avoided traditionally through government assistance, disturb the labor market. 8. Portugal and Spain were exempted from category two as part of their transition agreement and Ireland and Greece were granted authorization by the Commission (Dutheil de la Rochere 1991, 17). 9. William Dawkins and Robert Taylor, “French Threaten Action Against UK on Hoover,” Financial Times, January 27, 1993. 10. The Treaty of Rome designates basic rules of competition between firms. These include three general provisions. Article 85 prohibits behavior that prevents, restricts, or distorts competition within the common market, Article 86 prohibits abuse of a dominant position, e.g., monopolies, and Article 92 prohibits state aid that distorts competition by favoring particular products or firms. 11. The application of sales taxes for international trade in the EU follows the concept of “territoriality.” This means that once a product is exported, the tax that is applied on it is that of the destination market. Ideally, this means that products are taxed according to the market in which they are consumed. In reality, consumers can reimport exported products (e.g., French citizens can buy Perrier water Page 155 → in Luxembourg) in order to exploit differences in tax rates. The recent elimination of many customs checks makes detection of such behavior very difficult. Thus, only in rare cases is this rule enforceable (Herschtel 1993, 140). For example, when registering a new car, the owner must reveal where it was bought and thus can be charged a tax to compensate for differences in VAT. Also, sales by correspondence are required to compensate for VAT differentials. This restriction on correspondence purchases represents another advantage of residing near borders, since border residents can more easily replace correspondence purchases with personal purchases of foreign goods than nonborder residents can. 12. Commission of the European Communities 1987, “Completion of the Internal Market: Approximation of Indirect Tax Rates and Harmonization of Indirect Tax Structure,” COM (87) 320, Brussels, 9. 13. Note that a large number of cases does not guarantee high statistical significance. 14. Note that multicollinearity does not bias the estimates of the independent variables. 15. For each independent variable, I estimate one slope. Some readers may question this approach, preferring that a separate slope be estimated for each variable by nation. In other words, they would prefer

that I estimate a separate slope for French manual workers, German manual workers, etc. However, there is no theoretical reason to expect different slopes across nations. Without a theoretical justification, any decision to estimate separate slope based on geography (nation, region, or city) is completely arbitrary. 16. The four categories are: low (respondent completed education before age 15); low-mid (respondent completed education at age of 15–19); high-mid (respondent completed education at age of 20–21); high (respondent completed education after age of 21). Any respondent who was still studying was classified by age. 17. Based on the Eurobarometer coding of income quartiles, I divide respondents according to national quartiles, not EU-wide quartiles. This is appropriate because the adverse effects of integration on those of low-income concern how capital mobility and the anti-inflationary bias of the EMS constrain national welfare spending. Welfare benefits are distributed according to a citizen's relative national income. That is, an Italian is eligible for income assistance from the Italian government based on his wages relative to other Italians, not French or British. 18. I coded only residents of intra-EU land borders as border residents. I relied on Eurobarometer geographic definitions in identifying border residents. The Eurobarometer surveys identify respondents according to region and, for some countries, according to province. Where possible, I used province. 19. OLS is generally appropriate for analysis of continuous dependent variables. Conceptually, the dependent variable used in this analysis measures a continuous range of evaluations of integration ranging from “good thing” to “bad thing.” However, in practice this variable only has three response categories. Some readers might therefore prefer maximum likelihood estimation to analyze this discrete dependent variable. To reassure such readers, I tested the hypotheses with an ordered probit analysis and found results consistent with those presented here. 20. I have also estimated a model that includes all of the explanatory variables Page 156 → and interaction terms for each nation in each year (e.g., France in 1978). This permits me to control for time-specific fixed effects for each nation. The results are consistent with the estimates presented in table 12. Since this expanded model requires over one hundred additional variables, the results are not presented here. 21. The results for the control variables and the national and temporal dummy variables are presented in appendix B. 22. The baseline year and nation were chosen because they had the largest number of respondents. The substantive interpretation of the results would be the same with a different baseline. 23. Aggregate analyses tend to avoid these problems—and achieve higher R2 statistics—by using average scores that “cancel out” measurement errors across individual respondents.

Chapter 4 1. It is important to note that while every national economy has a comparative advantage, every national economy does not necessarily have an absolute advantage. 2. On a similar use of the term personal comparative advantage, see Duch and Taylor 1997. 3. The emergence of Toyota and Honda automotive production plants in the United States, in response to U.S. automobile quotas, illustrates this dynamic. 4. William Dawkins and Robert Taylor, “French Threaten Action Against UK on Hoover,” Financial Times, January 21, 1993. 5. Two recent articles describe the movement of capital to low-wage labor: “Monetary Chaos Precedes Europe's Single Market,” Wall Street Journal, July 28, 1995, A6; and “Haunted by the Trade Spectre,” Stephanie Flanders and Martin Wolf, Financial Times, July 24, 1995, 11. These dynamics have actually begun to work to the disadvantage of EU members with competition from low-wage unskilled Eastern European labor. The content of two related stories in the Wall Street Journal from December 9, 1993, are well summarized by their titles: “Western Europe Finds That It's Pricing Itself Out of the Job Market” (A1) and “Exporting Labor: Western Europe, Its Jobs Fleeing Eastward, Begins to Reconsider Employee Mandates” (A10). 6. Evidence from a recent book by Derek Bok (1993) supports this argument that markets work differently for high- and low-skilled labor. Bok observed that over the past twenty years in the United States increases

in the supply of professionals relative to demand for professionals has resulted in increased wages for top professionals. The reason for this, according to Bok, is that reputation commands a premium in the professions. Given the imperfections in available information regarding quality, reputation serves to reduce consumer risk in selecting services (Bok 1993, 68). In the U.S. context, reputation equates to the perceived quality of the school from which a professional earned her M.B.A., the status of a lawyer's firm, and the prestige of an accountant's employer. 7. Note that the human capital hypothesis presented in the previous chapter is unrelated to either the relative wages or the relative human capital hypotheses. The Page 157 → human capital hypothesis referred to occupation-based differences in utilitarian support related to vulnerability to unemployment during the transition to an integrated market. Human capital remains an important determinant of this vulnerability. The relative wages and relative human capital hypotheses apply to intra-group variation in utilitarian support for skilled and unskilled workers. 8. Monthly wages are asked in the Eurobarometer surveys and PPPs are reported in OECD data. 9. Note that if labor were highly mobile, relative wages based on exchange rates might not be the appropriate measure of personal comparative advantage for unskilled workers. Manual laborers, in deciding whether to relocate in pursuit of employment, consider whether the new wage is more valuable than the current wage. Since workers will spend most of their income in the economy in which they work, the attractiveness of a wage depends on its relative purchasing power, which may not be captured by exchange rates. Thus, to differentiate manual laborers according to their vulnerability to mobile labor from other nations, wages should be adjusted by purchasing power parities. It is worth noting that the results for Relative Wages of the regression in table 13 are not significantly changed by using wages adjusted by purchasing power parities. 10. For each nation in each year, I divided CAP receipts, consisting of spending from both the guarantee and guidance sections, by the number of farmers in the nation. See figure 3 for sources of data. 11. For a description of these other explanatory variables, see the discussion in chapter 3. 12. I have also estimated a model that includes all of the explanatory variables and interaction terms for each nation in each year (e.g., France in 1978). This permits me to control for time-specific fixed effects for each nation. The results are consistent with the estimates presented in table 14. Since this expanded model requires over 100 additional variables, the results are not presented here. In addition, an ordered probit model supports the same conclusions drawn from the OLS analysis. 13. The choice of the intercept as the level at which to calculate the occupation and wage effects on support is arbitrary and does not change the interpretation of the results. Alternative choices of education level, income, or other explanatory variables—provided they are held constant when comparing the occupational effects on support—would not change the difference in support between these occupations at each relative income.

Chapter 5 1. Eichenberg and Dalton (1993, 513) proposed a similar hypothesis, but based on different theoretical grounds. Eichenberg and Dalton expect public support to vary with trade dependence based on “transaction” and neofunctionalist integration theories contending that increased international interaction through trade fosters greater public support. 2. The economic data were compiled by the author using two sources provided Page 158 → by the Organization for Economic Cooperation and Development: Foreign Trade by Commodities (various years) and Main Economic Indicators (various years). 3. The trade data were measured according to exchange rates because these were the only available data. 4. The trade data were measured according to exchange rates because these were the only available data. 5. Estimates of war deaths are from Sivard 1985, Snyder 1982, and Keegan 1989. 6. In all of the Eurobarometer surveys from 1975 to 1992, respondents were asked a variation of the following question: “If there were a general election tomorrow, which party would you support?” For pre1986 surveys, Italians were asked, “Do you feel closer to any one of the parties on the following list than to all others? If yes, which one?”

7. 1.01 is the sum of the effects of War Deaths (1.61 × 1.5 war deaths per capita) and War Deaths Decay (–0.094 × 10 years × 1.5 war deaths per capita).

Chapter 6 1. Also see Shephard 1975, chapter 9. 2. For pre-1986 Eurobarometer surveys, Italians were asked: “Do you feel closer to any one of the parties on the following list than to all others? If yes, which one?” 3. I was not able to identify a bourgeoisie party in Luxembourg or Ireland. 4. Zaller (1992, 43) decides to use the term “political awareness” in place of “cognitive engagement” for simplicity of presentation. 5. Zaller (1992, 333–37), provides a detailed discussion of the advantages and disadvantages of different measures of political awareness. 6. Inglehart (1970b, 785), however, does mention that the content of information can influence the level of support. This point was not investigated and was not repeated in Inglehart, Rabier, and Reif 1991 nor in Janssen 1991. 7. Inglehart (1990, 69) argued that “the socio-economic environment influences the hierarchy of goalseeking of an individual. Individuals place the greatest subjective value on those things that are in relatively short supply. The level of economic and physical security surrounding the formative years of an individual will influence his/her concerns about these issues. For example, there should be substantial differences between the value priorities of older and younger generations following periods of rapid increase in economic and physical security.” 8. Note that previous research indicates that the Eurobarometer survey questions used to measure value orientations may not in fact measure materialist and postmaterialist values and that the theory itself is suspect (e.g., Duch and Taylor 1993; Clarke and Dutt 1991). In spite of these findings, I employ the traditional measures because I want to include controls for potentially confounding factors identified in previous studies. The value orientation variables employed here are the exact variables shown in earlier studies to be positively related to both support for integration and socioeconomic status. Thus, I include these variables to control Page 159 → for a potential confounding factor, whether or not this factor is an accurate proxy for value orientations. 9. Dalton and Eichenberg (1991) measured a nation's EC support by subtracting the percent of its respondents believing their nation's EC membership is a “bad thing” from the percent who believe it is a “good thing.” The results of their analysis indicated that the increase in public support for integration associated with a complete swing (from worse to better) in a nation's aggregate economic perceptions is never more than one and half points. This is true for retrospective and prospective evaluations of personal and national economic conditions. Thus, the substantive significance of these findings is small. 10. Survey data were not available to examine the relationship between prospective economic evaluations and support for integration. 11. Note that the results for model 1 also support most of the policy appraisal hypotheses. The only exception is for Pro-stability, which has a negative coefficient. 12. The only hypothesis that was not supported by the analysis was the proximity hypothesis. In model 2 in table 21, residence in a border region is not statistically different from residence in a nonborder region. 13. This model included controls for all alternative hypotheses for which variables exist in the full Eurobarometer data set. This means that political awareness and subjective economic conditions were excluded because they are not available in enough surveys to provide sufficient variation in temporal and national variables of interest (e.g., length of membership). For reasons of space, the results were not presented in the text. The results are available from the author upon request.

Chapter 7 1. This finding contrasts dramatically with Bosch and Newton (1995) who concluded that economics has no systematic impact on support for integration. The reason for this difference in findings may simply be that,

in contrast to this study, Bosch and Newton (1995) neither proposed nor tested a theory that systematically links economics to public support. 2. One of the most famous macroeconomic arguments for the EU internal market was the Cechini Report, provided by the European Commission. 3. Nicholas Bray, “European Labor Scorns Single Currency,” Wall Street Journal, November 10, 1996, A13. 4. Nicholas Bray, “European Labor Scorns Currency,” Wall Street Journal, November 10, 1996, A13. 5. On these directives, see Agence Europe, March 10, 1996, and March 29, 1996. 6. Agence Europe, April 4, 1996, 13. 7. While the codecision procedure provided in the Maastricht Treaty increases the influence of the European Parliament in policy-making, the national governments retain substantial control over legislative outcomes. 8. In principle, the EU's agenda is set by the European Commission, which consists of bureaucrats expected to pursue the EU's supranational interests. In practice, however, national governments have an important influence over the Page 160 → agenda. At the initiation stage national officials are instrumental in shaping legislation. More generally, the European Council, consisting of the president of France and the heads of government from the other EU members, has increasingly played a crucial role in initiating new EU projects and integrative reforms. Under certain conditions the European Parliament can also influence the agenda through its “conditional” agenda-setting power (Tsebelis 1994). 9. See Attina 1992, 67, for an analysis of voting behavior in the European Parliament. The study provides evidence that Members of the European Parliament (MEPs) often vote according to their EP party affiliation rather than their national identity, thereby suggesting that MEPs have developed cross-national affiliations. 10. The internal rules of the EP offer advantages for transnational alliances of its members. Committee positions, speaking time, and other institutional resources are distributed among the EP's members according to party group size. The requirements to qualify as a party group differ depending on how many nationalities are represented in the group. The more nationally diverse the group, the fewer members necessary to qualify as a party. This has promoted several large cross-national party groups that are defined on ideological rather than national lines. 11. In both the Single European Act and the Maastricht Treaty, the EP gained some conditional power to initiate legislation (Tsebelis 1994). However, the Commission remains the formal initiator of all legislation. Thus, those currently interested in shaping the EU agenda must ultimately lobby the Commission.

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Index Affect-based attitudes definition of, 17 European integration and, 112–13, 117 legitimacy of EU and, 7, 16, 31–34, 117, 151n. 8, 151n. 9 measurement of, 18, 28–29, 32–34 public support for integration and, 11, 12, 18, 24–34, 109–10, 113 Anderson, Christopher, 10, 52, 103 Attina, Fulvio, 119, 160n. 9 Becker, Gary, 43. See also Human capital Bok, Derek, 62–63, 156n. 6 Border residence and public support for integration, 13, 48, 53, 110, 155n. 18 Bosch, Agusti, 103–4, 159n. 1 Caldeira, Gregory, 18, 113 Cechini Report, 159n. 2 Churchill, Winston, and European integration, 1 Cleavage structure of EU polity, 6–8, 117–19, 121–22 stability of EU and, 7, 117, 121–22, 151n. 11 Cognitive mobilization and public support for integration, 9, 95–97, 106, 112 Commission of the EC/EU and EU policy-making, 6, 121, 159n. 8 Common Agricultural Policy (CAP), 48–49 distribution of benefits from, 63 distribution of subsidies to farmers, 66 public support for integration and, 48–49, 53–54, 63, 70, 72 Comparative advantage, theory of, 156 abundant factor model, 58 specific factor model, 58 Confirmatory factor analysis, 18

Eastonian theory and, 19–24 of national samples, 23 Congress of Europe, 2 Council of Ministers and EU policy-making, 6, 121 Cross-border shopping consumption taxes and, 48, 154n. 11 Price Waterhouse Report on, 48 Dahl, Robert, 8, 121 Dalton, Russell, 9, 38–39, 42, 51, 76, 90, 99, 102, 103–5, 107, 120, 151n. 13, 157n. 1, 159n. 9. See also Economic voting, theory of De Gaulle, Charles, and European integration, 1 Democratic capitalism European integration and, 77 public support for integration and, 13, 78, 86–87, 110 Democratic deficit defined, 7–8 proposed solutions for, 8, 121–22 stability of EU and, 8, 121–22 Diffuse support. See affect-based support Downs, Anthony, and rational ignorance, 40 Page 172 → Easton, David. See Eastonian theory of political support Eastonian theory of political support applied to EU, 11, 18–19, 55, 106, 113 defined, 15–18 public support for integration and, 11–12, 18–19, 24–35, 113, 152n. 3 tested in EU context, 19–35, 55 Economic and Monetary Union (EMU), 40, 42, 45–46 public opinion and, 27, 115 Economic perceptions and public support for integration, 10, 38, 99, 102, 107, 153n. 1, 159n. 9 Economic voting, theory of, 10, 38, 76, 99, 103–5, 107, 151

Education and public support for integration, 13, 52, 110 Eichenberg, Richard, 9, 38–39, 51, 76, 99, 102, 103–5, 107, 151n. 13, 157n. 1, 159n. 9. See also Economic voting, theory of Eichengreen, Barry, 11, 42, 125 Eijk, Cees van der, 6, 118, 119 European Agricultural Guarantee and Guidance Fund (EAGGF), 116 European Atomic Energy Community (EURATOM), 39, 151 European Coal and Steel Community (ECSC), 39, 75–76, 151 European Community (EC) distinguished from European Union (EU), 16 European integration and, 16 European Court of Justice (ECJ), 43 European Economic Community (EEC), 2, 39, 151 European integration economic focus of, 39–40 EC and, 16 EU and, 16 future reforms, 8, 115, 118–19 labor markets and, 42–44, 57–63, 154n. 7 measuring public support for, 27–28 motivation for, 1–3, 73, 75–76 process of, 2–3, 39–40 public opinion as measure of, 3 stability of EU and, 8, 121–22 European Monetary System (EMS), 42, 45–46, 155 European Regional Development Fund (ERDF), 116 European Parliament democratic deficit and, 7, 121–22 elections to, 6, 118–20 Left-Right dimension in, 120

legislative powers of, 6, 120, 159n. 8, 160n. 9, 160n. 10 partisan politics in, 6, 71, 118, 160n. 10 party groups in, 118, 120–21, 160n. 10 proposed reforms of, 6, 7, 119–22 representation of interests, 6, 71, 119–20 voting behavior in, 160n. 9 European Social Fund (ESF), 116 European Union (EU) cleavage structure of, 6–8, 117–19, 121–22 compared to other international organizations, 3 defined, 2–3 distinguished from EC, 16 European integration and, 16 policy-making in, 6, 118–22, 159n. 8, 160n. 11 Exchange Rate Mechanism (ERM), 45, 46 Factual knowledge of integration and public support for integration, 94 Farmers and public support for integration, 13, 48–49, 63 Federalist vision of European integration, 2 Feld, Werner, 9, 89, 152n. 3 Fontainbleau Summit, 3 Page 173 → France agricultural policy in EU and, 5 ECSC and, 46–47 EMS and, 75–76 referendum on the Maastricht Treaty in, 5, 9 Franklin, Mark, 6, 114, 118, 119, 151n. 12 Freiden, Jeffry, 11, 42, 46, 125 Functionalism, theory of, 15, 117

Germany ECSC and public opinion in, 6 EMU and, 75–76 trade between Eastern Europe and, 88 trade with the EU and, 88 Gibson, James, 18, 113 Gourevitch, Peter, 11, 125 Hall, Peter, 46 Hearly, Norman, 41 Hewstone, Miles, 9, 89, 95, 152n. 3 Hix, Simon 4, 8 Human capital and public support for integration, 13, 43–44, 52, 110, 156n. 7 Ignazi, Piero, 82 Income and public support for integration, 13, 46–47, 53, 110, 155n. 17 Inglehart, Ronald, 9–10, 16, 18, 20, 26, 31–32, 89, 95–98, 103, 152n. 2, 158n. 7. See also Silent Revolution, theory of Integration, European. See European integration Interest groups EU policy-making and, 118–19 international political economy and, 125 national, 118 transnational federations, 116, 118, 119 Internal market, economic theories of abundant factor model, 59 external economies of scale, 60 specific factor model, 59 International Trade public support for integration and, 13, 74–75, 85, 110, 157n. 1 with Eastern Europe, 88 within the EU, 74-75 See also Comparative advantage

Italian referendum on integration, 5 Katzenstein, Peter, 74, 125 Kinder, Donald, 123 Kiewiet, Roderick, 123 Krugman, Paul, 58–60 Kuklinski, James, 41 Labor markets and European integration, 42–44, 57, 63, 154n. 7 Legitimacy, 7, 15–16 affect-based attitudes and, 7 for the EU, 7 public allegiance and, 7, 16 supranational authority and, 7 Lijphart, Arend, 8, 121 Lindberg, Leon, 16, 18, 26, 32, 77 Mansholt Plan, 48 Maastricht Treaty. See Treaty on European Union Market liberalization, 11, 12 capital market, 44–45 labor market, 42–43, 154n. 7 trade liberalization, 47 Mass politics in the EU, 4–9 compared to traditional democracies, 4 electoral constraint, 5 referenda, 5 Materialist values and public support for integration, 10, 97–99, 112 Mitterrand, François, 9 Monnet, Jean, 2, 75, 151n. 1 Mudde, Cas, 143 Mutz, Diana, 123–24 Page 174 →

National economic conditions and public support for integration, 10, 38, 103–5, 107, 112 National security European integration and, 73, 75, 87 public support for integration and, 13, 77, 85–87, 110 Newton, Kenneth, 103–4, 159n. 1 Non-tariff barriers, 47 North Atlantic Treaty Organization (NATO), 76 Norwegian referenda on EU membership, 3, 5 Obstfeldt, Maurice, 58–60 OLS Regression discrete dependent variables and, 155n. 19 fixed effects and, 51, 84, 155n. 20 heteroskedasticity and, 51 multicollinearity and, 49, 155n. 14 pooled time-series data and, 51, 84 Parental Leave Directive, 116 Partisanship and public support for integration, 90–92, 107, 112, 146 Permissive consensus, 18, 32, 35, 112 Policy Appraisal Model, the, 39–42, 57 Policy-making, EU. See EU policy-making Political awareness and public support for integration, 93–94 Political capital, 152n. 1 Political parties. See also European Parliament anti-democratic capitalism and, 81–83, 143–44 bourgeoisie, 91–92 class-based, 91–92, 107 communist, 77, 82 European integration and, 90 extreme right-wing, 77, 82

Left-Right distinction of, 90–91 proletariat, 91–92 Posted Workers Directive, 116 Postmaterialist values and public support for integration, 10, 97–99, 112 Public knowledge of integration, 12, 40, 152n. 16, 154n. 3 Public interest in integration, 12, 40, 152n. 16, 154n. 3 Public integration, 3. See also Social integration Public opinion. See also Public opinion formation consistency of, 122–23 foreign policy and, 123 international political economy and, 125 self-interest and, 123 Public opinion formation, 93, 157–58 elite opinion and, 41, 114 elites and, 40–42 with low-information, 40–42, 123 media and, 124 theories of, 12, 40–42, 93, 122–24 See also Mutz, Diana; Zaller, John Public support for integration affect-based attitudes and, 11, 12, 18, 24–34, 109–10, 113 border residence and, 13, 48, 53, 110, 155n. 18 cognitive mobilization and, 9, 95–97, 106, 112 CAP and, 48–49, 53–54, 63, 70, 72 democratic-capitalism and, 13, 78, 86–87, 110 Eastonian model and, 11–12, 18–19, 113, 152n. 3 economic perceptions and, 10, 38, 99, 102, 107, 153n. 1, 159n. 9 education and, 13, 52, 110 factual knowledge of integration and, 94

farmers and, 13, 48–49, 63 human capital and, 13, 43–44, 52, 110, 156n. 7 income and, 13, 46–47, 53, 110, 155n. 17 Page 175 → international trade and, 13, 74–75, 85, 110, 157n. 1 materialist values and, 10, 97–99, 112 national economic conditions and, 10, 38, 103–5, 107, 112 national security interests and, 13, 77, 85–86, 87, 110 partisanship and, 90–92, 107, 112, 146 political awareness and, 93–94 postmaterialist values and, 10, 97–99, 112 skilled workers and, 13, 52, 62–63, 68–69, 110 socialization and, 103, 105, 112 unskilled workers and, 13, 52, 60–62, 68–69, 110 utilitarian attitudes and, 11, 12, 24–31, 35, 109–10 value orientations and, 9, 97–99, 106, 112 wages and, 60–63, 65 Purchasing power parities (PPP), 65, 142 Putnam, Robert, 117, 119 Rabier, Jacques-Rene, 9, 10, 16, 18, 20, 26, 31–32, 89, 95–98, 103, 152n. 2 Referenda on European Integration, 3, 5 Reichert, Shawn, 10, 52, 103 Reif, Karlheinz, 6, 9, 10, 16, 18, 20, 26, 31–32, 89, 95–98, 118, 119, 152n. 2 Retrospective voting, theory of, 17 Rogowski, Ronald, 11, 58, 125 Sandholtz, Wayne, 73 Scheingold, Stuart, 16, 18, 26, 32, 77 Schmitt, Hermann, 6, 118, 119 Schuman Plan, 151n. 1

Schuman, Robert, 2, 75 Second image, 124–25 reversed, 125 Shephard, Robert, 9, 15, 18, 26, 117, 158n. 1 Silent Revolution, theory of, 9, 97–98, 158, 159n. 8 Single European Act (SEA), 6, 40, 47, 52 Skilled workers and public support for integration, 13, 52, 62–63, 68–69, 110 Slater, Martin, 8, 15, 18, 32, 77, 152n. 2 Social integration, 3, 117–19, 151n. 9 Social Policy Agreement, 116 Social Protocol, 116 Socialization and public support for integration, 103, 105, 112 Specific support. See Utilitarian support Spinelli, Altiero, 2 Stimson, James, 6, 84, 85, 93, 123 Structural Funds, 116 Taylor, Paul, 8 Thatcher, Margaret, 5 Treaty of Rome, 42, 44 Treaty on European Union (TEU), 6, 18, 28, 33, 40, 45, 116 Danish referendum on, 3 French referendum on, 5, 9 United Nations, 76 Urwin, Derek, 77 United States of Europe, 2 Unskilled workers and public support for integration, 13, 52, 60–62, 68–69, 110 Utilitarian attitudes definition of, 16–17 economic integration and, 37–42, 55, 106, 109

measurement of, 18, 28–31, 55 public support for integration and, 11, 12, 24–31, 35, 109–10 Value orientations and public support for integration, 9, 97–99, 106, 112 Page 176 → Wages and public support for integration, 60–63, 65 Wildgen, John, 9, 89, 152n. 3 World War II, 1–2, 12, 73, 75, 79, 87 deaths from, 79–80 Ysmal, Colette, 82 Zaller, John, 93–94, 123, 158n. 4, 158n. 5