Schulte, Markus
(1997)
Industry, politics and trade discrimination in West Germany's European policy 1957-1963.
PhD thesis, London School of Economics and Political Science.
Abstract
This thesis addresses the German position in the negotiations on the British proposal for a Europe-wide free trade area, on the acceleration of the tariff schedule of the European Economic Community (EEC) in 1960, the formation of EFTA, and the first British application for membership of the EEC. To do this it analyses the attitudes, interests and lobbying efforts of German industry, West Germany's European policy from 1957 to 1963 after the establishment of the EEC and industrial influence on the respective decisions by the Federal Government. The main focus is on the trade relations with Western European countries outside the EEC. Previous historiography has stressed the overriding German economic interest in and corresponding industrial pressures for avoiding trade discrimination by the EEC vis-a-vis the other European members of the OEEC/OECD. It has however failed to address the problem that, despite an alleged political consensus in line with these economic interests. Chancellor Adenauer was able to deliver a policy precluding the Europe-wide solution demanded by parliament, German business, and Ludwig Erhard, the Minister of Economics. It seems to suggest that this policy outcome was mainly a function of Adenauer's personal authority and his constitutional prerogatives as Chancellor. In order to address this central problem, the thesis examines industrial interests at the sectoral level. These are analysed on the basis of a quantitative study of sectoral foreign trade in manufactured products with the countries of EEC and EFTA respectively in the 1950s and 1960s. From other sources it examines the influence which German industry exerted on government policy towards European economic integration. This reveals that industrial interest at the sectoral level in fact gave rise to lobbying pressures for the policy outcome sought by Adenauer, to prevent the large Europe-wide free trade area and to prevent British accession to the EEC. The quantitative analysis shows that for those sectors in favour of the proposed free trade area and British accession the opportunity costs of the failure of these two projects were practically invisible. For sectors in decline and in structural difficulties, on the other hand, both these projects constituted a major threat. The EEC of the Six, however, offered them not only protection against competition from outside, but at the same time considerable export opportunities, particularly in the French and Italian markets. The intra-governmental power struggle over these issues is analysed first with regard to industrial pressure and second to the international framework and the respective constraints and opportunities it provided for domestic policy makers in West Germany. The eventual policy outcome is explained in three dimensions: first in terms of the particular structure of industrial interest and respective pressures; second an alliance between protectionist interests and the specific political agenda of the head of the executive; third in terms of opportunities for the Federal Chancellor arising from the interplay of policy and power at the international level. It is argued that this is a more convincing interpretation and more securely based on the historical evidence.
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