A Comparative Analysis Of U.S. And EU FTA Negotiations With South Korea Under Principal–Agent Framework

Based on Principal-Agent Theory,this thesis comparatively analyses the delegation process of the United States and the European Union in the area of foreign trade policymaking.Starting with the analysis of each side's differences,it then applies the distinct delegation structures to the case studies of U.S.-Korea and EU-Korea Free Trade Agreement negotiations and comparatively analyses its implications for each negotiation as well as testing for eventual “Agency Slack”.This analysis finds that U.S.Congress' s(principal's)mechanisms of control largely constrain USTR's(agent's)autonomy.In contrast,in the EU the Commission(agent)enjoys much larger autonomy,mainly caused by low level of control by the Council(principal)during agenda-setting phase.During negotiation,U.S.Congress' s effective veto-player role is an important reason for USTR's high bargaining power,forcing Korea to give concessions in many areas.However,Congress' s permanent control forces USTR to constantly engage in long consultations,therefore hindering USTR to accomplish its main target,balancing against growing China.In contrast,European Commission's high degree of autonomy enables it to strategically interact with business groups with similar preferences and thus to design a very unspecific negotiation mandate,highly reflecting Commission's own preferences.In order to achieve its main target – receiving ‘first-comer advantage' compared to the US – the Commission can make concessions to Korea,while ‘buffering' against principal's sanctioning.In this sense,this thesis overcomes current Principal-Agent literature's limitation of treating agent buffering as simple information-hiding.It further argues that buffering is better understood as measures to block against principal sanctioning in general,comprising Commission's ‘Focal Point',interest groups alliance forming as well as strategically playing multiple principals off against each other,thus contributes to Principal-Agent literature.