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Democracy, Veto Players and the Depth of Regional Integration


  • This paper was prepared for a conference on ‘The Sequencing of Regional Economic Integration: Issues in the Breadth and Depth of Economic Integration in the Americas’, which was held at the Kellogg Institute for International Studies, University of Notre Dame, 9–10 September 2005. It was also presented at seminars at Emory University and the University of Pittsburgh. For helpful comments, we are grateful to David Bearce, Jeffrey Bergstrand, Alexandra Guissinger, Mark Hallerberg, Raymond Robertson and various other seminar and conference participants.


We examine how domestic political factors influence the type of regional integration arrangement (RIA) that states enter. States can pursue at least five types of RIA, in order of their depth of policy integration: preferential trade agreements, free trade areas, customs unions, common markets and economic unions. We argue that a country's regime type and the number of institutional ‘veto players’ strongly affect the type of arrangement that states choose. Democracies are more likely to form an RIA than other states, a tendency that becomes more pronounced as the proposed level of integration in an arrangement rises. However, all democracies are not the same. As the number of veto players rises, the likelihood of a democracy entering an RIA declines. Furthermore, veto players are expected to have a larger effect on the odds of a democracy forming an RIA, the greater is the extent of integration that the arrangement aims to achieve. A series of statistical tests, based on analysis of all pairs of countries from 1950 to 2000, support our arguments.