Conditionality

Conditionality and the Manipulation of Utility Calculations

Conditionality seeks to influence the behavior of actors through the manipulation of utility calculations, by providing negative and positive incentives. Donor states or organizations seek to promote structural adjustments in third countries by promising or granting additional benefits, such as [Page 383]financial and technical assistance, a loan, debt relief, or conditional membership in an organization. Or they incur costs through economic and diplomatic sanctions. “Reinforcement through reward” (Frank Schimmelfennig & Ulrich Sedelmeier, 2006) or “correction through punishment” differs from political instruments based on a normative logic of social action, such as political dialogue, which seek to change the behavior of actors through persuasion and learning (Jeffrey T. Checkel, 2005). Conditionality and political dialogue both aim at influencing the choice of actors, whether they are informed by cost–benefit calculations or guided by normative concerns about socially accepted behavior. They thus contrast with coercion and assistance. While the former does not leave actors any choice, the latter provides unconditional financial and technical aid to enable actors to make choices.

Evolution of Conditionality as an Instrument of External Governance

Conditionality emerged in the field of development cooperation. In the 1980s, the International Monetary Fund and the World Bank increasingly linked loans, debt relief, and financial aid to certain conditions, known as structural adjustments, which included aid effectiveness (e.g. anticorruption measures), financial austerity, or the privatization of key public services. While international donors have used conditional aid to promote selective reforms deemed necessary for good governance, the EU turned conditionality into the key instrument in its attempt to support the transformation in postcommunist countries after the end of the Cold War (Heather Grabbe, 2006). The Maastricht Treaty had made any contractual relations of the EU with third countries conditional on the respect for human rights, the rule of law, and democracy (see Tanya Börzel & Thomas Risse, 2009). States applying for membership in the EU have to fulfill the so-called Copenhagen Criteria (democratic conditionality). Once the EU agreed to open accession negotiations, accession conditionality gave the European Commission a powerful tool to push candidate countries toward downloading the comprehensive acquis communautaire and introducing institutional reforms (see Schimmelfennig & Sedelmeier, 2006).

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