Michael Funke
Department of Economic History
Uppsala University
Dear fellow participants of the session
This paper is mainly based on findings in my forthcoming doctoral thesis in Economic History, which focuses on the policy process of advertising self-regulation in Sweden during 1950-1971. At the moment I am finishing up a first final draft to be presented this fall. The thesis departs from a theoretical combination of the strategic interests of business interest associations (leaning on the logic of membership vs. logic of influence model) and a stages heuristic theory modified to suit the self-regulatory policy process of self-regulation. The main actors in the thesis are business associations. This paper tries to take things bit further by looking at the actions of all actors relevant for the policy process of advertising self-regulation. To do so it introduces a theoretical model that combines Advocacy coalition framework theory with the two other approaches. Empirically the paper leans on mainly four chapters of the thesis; the introductory chapter, first empirical chapter covering the general positions on advertising among key actors in the Swedish political economy at the time, the second empirical analyzing the strategies of the business associations in the policy process of self-regulation and the third empirical analyzing the organized business involvement in the policy process of the statutory regulations of advertising. All these chapters have been presented at several conferences and seminars. The general idea in this paper is to explore new possibilities of research, either in the thesis or in further research.
Advocacy coalitions, strategic interests and the policy process of Swedish advertising self-regulation 1950–1971
Policy change and policy processes have received increased interest in recent decades. This is evident not only in the number of empirical studies, but also in a dynamic development of theory and method, with ensuing debates and discussions on the merits and shortcomings of different approaches (Sabatier & Jenkins-Smith 1993; Sabatier & Jenkins-Smith 1993; Sabatier & Jenkins-Smith 1999; Sabatier 2007). One theory that has received significant attention is the advocacy coalition framework (ACF). The ACF has been developed since the late 1980s in a number of theoretical contributions, with Paul A. Sabatier and Hank C. Jenkins-Smith being particularly salient. The framework affords special focus on the importance of actor coalitions in explaining policy change. These are said to exist over prolonged periods of time and either struggle over or negotiate over policy outcomes. Coalitions often incorporate broad groups of actors, such as interest groups, government officials, experts, policy entrepreneurs and even journalists. The ACF regards policy subsystems as the best level of analysis, and proposes that these include actors from many levels of government. (Sabatier 1987; Sabatier & Jenkins-Smith 1993; Sabatier 1998; Sabatier & Jenkins-Smith 1999; Sabatier 2007; Weible & Sabatier & McQueen 2009)
The ACF assumes that a coalition is bounds together by a shared hierarchical belief system of its members, where deep core beliefs (ideology) and policy core (general policy principles of the subsystem) are more immune to change than secondary beliefs (instrumental and administrative issues). These beliefs are also seen as the main causal mechanism driving the actions of the coalitions and leading to subsequent policy change. This change can be minor, shifting secondary beliefs, or major, changing policy core beliefs. Initially the ACF described two paths to major policy change: learning and external subsystem events. In the first case the framework sees policy change as being contingent on the internal learning of coalitions, a process where expertise and new knowledge play crucial roles and the policy process take place in a setting with stable external structures. In the second case major policy changes in a subsystem are associated with external chocks, leading to a significant redistribution of political resources and a modification of the core of a policy beliefs. The external systems function as both constraint and resource for the coalitions. Recently two more paths have been added to the framework. The third path is internal subsystem events, usually based on realization of failed current policies, and the fourth revolves around the possibility of a negotiated settlement between two or more coalitions (Sabatier 1998; Weible & Sabatier & McQueen 2009).
Advocacy Coalitions aim to transform their beliefs into policy by utilizing a number of different strategies. Among these we find lobbying, research, mobilizing public opinion, initiating research, taking part in state commissions, legal means, etc. The theory has empirically been associated with policy subsystems dependent on the expertise of natural science (energy, environment, forestry), but according to Sabatier et al, an overview of over 80 case studies using the framework proves its usefulness in other policy fields. The framework has also been used in conjunction with the stages heuristic, which Sabatier et al think is feasible, given four conditions. Firstly, the stages heuristic should be viewed as an organizing tool lacking inherent explanatory value. The stages are therefore to be regarded as either linked to strategies or arenas. Second, it must be understood that coalitions often have a multi-policy perspective. Third, the same can be said of stages, where coalitions will be simultaneously active within many policy stages at once. Fourth, the stages model lacks explanatory power regarding group formation or group strategy, and here the ACF should instead be used (Sabatier 1998; Weible & Sabatier & McQueen 2009).
The ACF has made key contributions to the discussion on the importance of actor beliefs and actor agency within policy subsystems (Sabatier 1987; Sabatier 1998; Zafonte & Sabatier 1998; Sabatier & Jenkins-Smith 1993; Sabatier 1999; Sabatier 2007; Weible & Sabatier & McQueen 2009). Still, other aspects of the theory have been criticized as having weak or insufficient explanatory power. The emphasis on beliefs as the causal drive of policy change has been described as one-sided and ignoring the importance of strategic interests in the political power play that policy processes often are part of (Schlager 1995; Schlager & Blomquist 1996; Hoberg 1996; Nohrstedt 2005). In a series of papers exploring the change in Swedish nuclear policy after the Three Mile Island crisis in 1979, Daniel Nohrstedt suggests that core policy beliefs do not always come into play when actors react upon what can be termed a crisis event, whether it is internal or external to the subsystem in question. While the ACF posits that core policy beliefs seldom change, but can do so when a subsystem is subject to crisis, Nohrstedts conclusion from studying the actions and beliefs of the ruling Social democrats party at the time of the Three Mile Island crisis is that the party retained its positive core policy beliefs in nuclear power, but due to a sudden surge in negative public opinion on nuclear power after the disaster decided to opt for a referendum and a more ambivalent public stance on nuclear power. This decision, then, went against the core policy beliefs, but was implemented to secure political power and avoid party infighting and loss at coming elections, i.e. strategic interests were given primacy over policy beliefs when guiding policy action. Accordingly neither minority coalition mobilization nor majority coalition learning was a deciding factor in events. Instead strategic action of select leadership of the incumbent elite shaped policy outcomes (Nohrstedt 2005; Nohrsted 2007; Nohrsted 2008). Concluding, Nohrstedt does not refute the applicability of the ACF in analysis of policy change, but urges careful research design and process tracing to differentiate between for example policy change due to learning and subsequent shifts in policy values and policy change due to mainly strategic interest considerations. In his analysis, Nohrsted combines the analytical model of the ACF with a rational choice inspired model of political parties’ strategic interests that allows for analysis to differentiate between these two causal explanations of actor agency and subsequent policy change.
This paper will depart from this suggestion of combining an ACF with an interest oriented approach to better understand policy change. The subject of study is the policy process of Swedish self-regulation of advertising during the time period 1950–1971. The beginning of the period is chosen for two reasons. Firstly, the state initiated a number of competitive and consumer oriented policies during this time, which directly or indirectly affected advertising. Secondly, the sustained economic growth during this time completely transformed lifestyles and consumption of Swedish society, giving an unprecedented possibility of hedonistic consumption, hence also propelling advertising to the fore of social, political and economic life. During this time, it was also a hotly debated social issue, often within the context of consumer issues. Advertising was criticized for manipulating consumers, creating higher prices, wasting resources and creating informational overload and ecological strains. Among critics counted both influential interest groups such as trade unions, the cooperative movement and women’s associations that had official state sanction as consumer representatives in corporatist power structures, and influential individual critics from academia and intellectual circles. (Funke 2011; Funke 2012) At the same time, the business community considered advertising an integral part of the free market, and vigorously defended it, usually through its business associations or by business supported research. Reflecting these major events, advertising regulations went through several changes at this time period. Particularly self-regulation was reformed and transformed.
Given the historical context, the policy process of Swedish advertising self-regulation exhibits many promising qualities for a policy process analysis in the context of an ACF/interest group framework. Still, some revisions in theoretical make up are necessary. Nohrstedt’s strategic interests are modeled on the behavior of political parties. These are vote maximization (winning elections), office seeking (private gains from office), policy seeking (maximizing effects of policy), representation (mediating public sentiments) and party cohesion (party unity). They fit quite well with political actors. But as self-regulation usually is created, maintained and developed by market actors or their associations, an interest model more attuned to this type of actor is needed.
Theoretical and empirical research on business associations has suggested that these are run by two competing logics, the logic of membership and the logic of influence. The logic of membership focuses on market internal factors, and represents the interaction between the interests of members and the interests of the associational leadership. Here members offer market compliance to the leadership who in turn supplies direct market control in the form of competitive rules as cartels or self-regulation. The logic of influence focuses on the exchange between associational leadership and external envirnoment that the association has an interest in influencing, i.e. the state and other interest groups (trade unions, consumer movements). Here the goal is to influence regulations and actors that have a potential indirect control of the market, such as state regulations. The associations main task has historically therefore been to handle and reduce risks, both on the market and due to market external factors (Lundqvist 1995; van Waarden 1992; Schmitter & Streeck 1999). The literature on self-regulation also emphasizes that business support for self-regulation can be deduced to the following interests: 1) profitability 2) consumer sovereignty (fair competition and consumer rights) 2) influencing state policies 3) creating public good will. The first two interests correspond to the direct market interests of members, while the other two correspond to interests in market external factors. (Funke 2012).
Also, the study will utilize the stages heuristic (agenda setting, problem definition, decision making, implementation, evaluation) as an ordering mechanism in analyzing the policy process. This warrants a further modification, as the policy process of self-regulation displays some structural differences from state policy processes. Most self-regulatory systems co-exist, or even co-regulate, with state, supranational or international regulations. This has led to the development of a modified stages heuristic approach in studying the policy process (Gunningham 1995; Wotruba 1997; Jenkins 2001; Haufler 2001; Scott 2002; Porter & Ronit, 2006).
Porter & Ronit note that the structures and rules of the state enabling and constraining policy formation is either lacking or not well known when it comes to internal rules being set up by market actors. The development of self-regulatory policies is hidden from public view, either intentionally or due to the indifference of the public. Instead this process takes place in clandestine, with business associations and regulatory experts as main actors. (Porter & Ronit, 2006)
Nevertheless, the authors assert that the basic model of the stages heuristic, is valid for self-regulations too. What must be kept in mind, Porter & Ronit state, is that most self-regulatory practices evolve in interaction with state laws, and that the particular co-regulation the two systems create in a given setting varies over time and in place, affecting the policy process of self-regulation in unexpected ways. Here actors from the business world interact with market outsiders as representatives of consumers and the state. This can lead to the process “criss-crossing” or being terminated or interrupted in unexpected manners, but still essentially be explainable within the framework of analysis. Also to be considered is the power of public opinion and policy strategies aimed at influencing it. Putting a self-regulatory issue on the agenda that attracts public attention can pressure the self-regulatory process into opening up. This in, in turn, is close to the reasoning of both the ACF and the interest approach, where external or internal subsystem crisis can affect policy beliefs and force actors to resort to strategic action. (Porter & Ronit, 2006)
Advertising regulations in Sweden during 1950 –1971
Advertising in Sweden had few statutory regulations at the start of the period. The law of 1931 on disloyal competition forbade explicit lies in advertising, but awarded damages only to producers, being primarily a law to regulate fair competition. Thus a number of self-regulatory bodies started to appear in the 1930s, with two regimes functioning side by side until a merger in 1957, creating one regime. As its precursors, the regime was based on the international code of advertising practice, and transgressions, or accusations thereof, were handled by a self-regulatory agency, of which a number of business associations were both principals and stakeholders. The agency functioned in a judicial-like manner, although it lacked coercive powers. Self-regulation had initially been created to look after producer interests, but relatively quickly representation of consumer interests was officially made part of the operations of the regime. Still, very few consumers made use of the institution (SOU 1972:7; Boddewyn 1985).
In 1963, consumer representatives were made part of the main self-regulatory body, Näringslivets opinionsnämnd (NOp). The 1963 State Commission on disloyal advertising suggested in its 1966 report introducing a general clause to strengthen marketing law, but at the same time keeping a primary role for self-regulation. However, the Social Democratic government decided to discard the report and instead proposed extensive statutory consumer regulations, which were approved by parliament 1970. In 1971 the new regime basically replaced the old self-regulatory system with a Consumer Ombudsman acting as a consumer attorney in front of a special Market Court with coercive statutory powers. Later a National Consumer Board was added in 1973, and in 1976 the Consumer ombudsman became its head (Funke 2011; Funke 2012). According to (Boddewyn 1985), the replaced regime of self-regulation suffered from four major drawbacks: the inability to highlight rising consumer concerns, not being well known among consumers, a limited capacity to handle large number of complaints and difficulties in getting non-compliers to adhere to self-regulation. Self-regulation, in turn, thus went through major reforms in 1968 to adapt to the new regulatory landscape. The new self-regulatory regime was based on internal producer censorship to avoid production of advertisements that would be in breach of the coming laws, and survives more or less intact until this day (SOU 1972:7; Funke 2004).
The coalitions of the policy subsystem of advertising
During the chosen period of study, the policy subsystem of advertising consisted of two competing advocacy coalitions. The first coalition, termed the producer oriented coalition, was mainly comprised of business associations with interests in advertising and advertising regulations, business oriented academics, politicians, journalists and public intellectuals. The second coalition, named the consumer oriented coalition, was made up of interest groups and individuals that claimed to represent the consumers. Among these we find trade unions, the cooperative movement, state officials, academics, consumer activists, journalists, artists and public intellectuals. Of these, the interest groups received official legitimacy by being selected as consumer representatives in the new state agencies created in the postwar era. Likewise, several of the business associations were given similar positions on these agencies in the capacity of producer representatives (Funke 2004; Funke 2011; Funke 2012; Jäfvert 1969; Pestoff 1984; Rothstein 1992; Lundqvist 2003; Lundqvist 2007). This was in line with the corporatist policies of the social democratic state, whereby interest groups were co-opted into subordinating or at least adjusting their interests to that of the state. In consequence the coalitions each had a central core supported by the corporatist structures, which incidentally also placed them in the same policy structures, covering most of the stages heuristic model.