From Free Trade to Supranational Polity: The European Court and Integration

Abstract

Abstract Proposes and tests a theory of legal integration as a process by which a supranational legal system has been constructed in Europe, centred on the European Court of Justice. It argues that legal integration has been driven by the emergence and consolidation of specific causal linkages between three factors: transnational exchange, triadic dispute resolution, and the production of legal rules. Once forged, these linkages generate a self‐sustaining dynamic that serves to expand the scope of supranational governance and to accelerate the institutionalization of existing supranational policy‐making authority at the expense of intergovernmental arrangements. The chapter begins by elaborating the principal‐agent model of delegation that is supported by the intergovernmentalist approach, and provides a theoretic explanation of the process by which bargaining between the principals (national governments) is replaced by decision‐making within the agents (supranational organizations). The application of the theory is tested against two policy domains—the free movement of goods and the provision of social services.