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Illustrates why the present institutional framework of the EU is no longer able to face new policy challenges. Provides an overview of general modes of EU policy‐making and then addresses concrete new policy challenges faced by the EU (common foreign and security policy, eastern enlargement, and monetary union) with regards to the strengths and limitations of these policy‐making procedures. Scharpf presents an argument for limitations in recent EU reform debates, from the White Paper on Governance to the European Convention, and argues for new modes of European governance that will allow effective ‘Europeanized’ responses to new policy challenges accommodating ‘legitimate diversity’ at the national level. Begins with a brief overview of the principal ‘modes’ of EU policy‐making—defined by participation rights and decision rules—for which the labels of ‘intergovernmental negotiations’, ‘joint decision making’, and ‘supranational centralization’ are used, and then the new policy challenges with regard to the strengths and limitations of these present modes of policy making are discussed. The seven sections of the chapter are: The Challenge of Present Constitutional Debates; The Plurality of European Governing Modes; New Policy Challenges; The European Dilemma: Consensus Plus Uniformity; Two Non‐Solutions: Subsidiarity and Majority Rule; European Action in the Face of Legitimate Diversity; and Conclusions.

Fleshes out some of the common horizontal themes emerging from the book, and presents the broad elements of federal vision that have been discussed. The vision calls for five concurrent shifts in understanding what matters about federal contracts, each central to fashioning a ‘federal’ response to the challenge of legitimacy. In particular, it is suggested how the notion of ‘subsidiarity’ as commonly understood—that political decisions should be made and policies conducted at the lowest, or most appropriate, level—should be fine‐tuned, reinterpreted, or even relabelled. The five shifts that are discussed in the different sections of the conclusion are: from allocative outcomes to the process of change—legitimacy and flexibility; from distributed to shared competences—networked cooperation, proportionality, and changing forms of governance; from separation of powers to power checks—governance structures, procedural subsidiarity, and the safeguards of federalism; from power containment to empowerment—proactive subsidiarity, managed competition, and mutuality; and from multi‐level (hierarchical) to multi‐centred governance and horizontal subsidiarity. The concluding section looks towards a model of global subsidiarity.

This chapter briefly reviews the history of the EU as it relates to the role of EU institutions in environmental policy-making. It explores EU decision-making institutions and processes and the relationship between the EU and its member states, with particular reference to role and responsibilities in implementing the UNFCCC and the Kyoto Protocol and otherwise addressing climate change. It then reviews EU climate change law and policy to date, focusing on regional policy initiatives. In examining EU governance systems and climate initiatives, it seeks to begin revealing similarities and differences in EU and US political systems as a preface to more in-depth comparisons in Chapters 7 and 8.

Each of the four chapters of Part I of the book synthesizes one aspect that must be specified in the operationalization of the capability approach, then proposes a framework for doing so. This fourth chapter considers the relationship between choice, self‐direction, and the construction of cultural values and identities. It analyses the different possible values of community participation in poverty reduction initiatives, and also draws out considerations regarding the responsibilities that outside actors may have in generating and providing to decision‐makers the information necessary to make informed choices. It draws Amartya Sen's capability approach into discussion with the participatory processes that have been common in micro‐economic development initiatives, and that are becoming increasingly popular in macroeconomic approaches as well, and, in particular, focuses on community participation in development activities that are partly supported by resources external to the community, whether these be from regional or national government, NGOs, or other sources. The main sections of the chapter are: Participation: Means, Ends, Debate, and Identity; Subsidiarity; and External Assistance.

This chapter discusses the way in which the EU has developed approaches to using territory as a policy instrument. It explores this through the literature on multi-level governance, examining it as a theory but also as a model, an analytical framework and a policy which has intended outcomes. The chapter particularly considers the principle of subsidiarity and its emerging role in the operation of EU strategy and policy. It also discusses the more recent emergence of the principle of territorial cohesion. The chapter continues to discuss the implications of the application of these principles within the UK, including the implementation of core state policies of devolution and localism. Finally it looks at the impact of these policies on regional institutions within the UK and the impact on local government.