This research aimed to prove that private economic Europeanization agents were theoretically and practically capable of producing legislative change in Latvia. It tested three hypotheses: 1) that private actors can be agents of Europeanization, 2) that to be an efficient agent of Europeanization the actor must possess two capacities: the capacity of conditionality and the capacity of socialization, and 3) that private foreign banks with EU origins used their conditionality and socialization capacities to Europeanize Latvia. Based on a sociological institutionalist approach to explaining the Europeanization process of EU candidate countries – and in particular on work of F. Schimmelfennig and U. Sedelmeier, H. Knobel, S. Engert, H. Grabbe, J. T. Checkel – this research developed and tested six criteria for Europeanization agents using a process tracing method. Research utilized twenty-five semi-structured in-depth interviews with the relevant Latvian prime ministers, ministers of foreign affairs and ministers of finance, as well as the board members of banks, the governor of the central bank, and state secretaries of the ministry of finance and the ministry of foreign affairs. The research also utilized economic data analysis and document analysis. The research concluded that private banks with EU memberstate origins, in particular those from Sweden, Finland and Germany, operating in Latvia before the country’s accession into the EU, had both conditionality and socialization capacities. The history of the acquisition of Latvian domestic banks at the end of 1990s and the subsequent Nordic expansion in the Latvian banking sector went hand-in-hand with Latvia’s transposition of acquis communautaire. The research also revealed the ability of banks to affect the influx of foreign direct investments in the capital-scarce Latvian economy in return for the implementation of structural reforms in the legal and political system. Conditionality was important in the overall speed and resolve in managing shortcomings in the financial system and accessing the EU. These private foreign banks were not only important due to their capacity to outcompete the domestic economic actors with their products; they also established intensive social interaction via their proximity to decision-makers in Latvia, and they actively used persuasion and socialization strategies on Latvian institutions. Finally, the values promoted by these banks fit the pre-existing value understandings in Latvia, making their conditions more acceptable, although some of the banks did not always “practice the principles that they preached”.
- Political Science
- Subsection – International Politics
- sociological institutionalism
- Doctoral Thesis
Field of Science*
- 5.6 Political science
- 4. Doctoral Thesis