UNIVERSITEIT GENT

FACULTEIT ECONOMIE EN BEDRIJFSKUNDE

ACADEMIEJAAR 2014 – 2015

CCCTB: Analysis of the Voting Behaviour of Members of the European Parliament

Master of Science in de Bedrijfseconomie

Stef Ceuppens

onder leiding van

Prof. Dr. P. Van Cauwenberge

UNIVERSITEIT GENT

FACULTEIT ECONOMIE EN BEDRIJFSKUNDE

ACADEMIEJAAR 2015 – 2016

CCCTB: Analysis of the Voting Behaviour of Members of the European Parliament

Master of Science in de Bedrijfseconomie

Stef Ceuppens

onder leiding van

Prof. Dr. P. Van Cauwenberge

PERMISSION

Ondergetekende verklaart dat de inhoud van deze masterproef mag geraadpleegd en/of

gereproduceerd worden, mits bronvermelding.

Stef Ceuppens

i

Samenvatting

Deze masterproef onderzoekt het stemgedrag van Europese Parlementsleden (MEPs) tijdens de

stemming rond de richtlijn voor een gemeenschappelijke geconsolideerde heffingsgrondslag voor de

vennootschapsbelasting (CCCTB). Op 19 april 2012 keurde het Europese Parlement (EP) een

geamendeerde versie van het CCCTB voorstel goed. Hiermee gaf het EP een krachtig signaal om de

wetgeving omtrent de Europese vennootschapsbelasting te harmoniseren en op deze manier een

belangrijke stap richting een eengemaakte Europese markt te zetten. Door de specifieke aard van

deze richtlijn is de bijzondere wetgevingsprocedure van toepassing, met als gevolg dat het EP louter

een adviserende rol en geen medebeslissingsrecht op de CCCTB stemming heeft. Tevens moet

benadrukt worden dat de CCCTB de EU in zijn geheel ten goede komt, maar dat deze effecten sterk

verschillen per lidstaat. Deze twee factoren maken van de CCCTB stemming een ‘kritieke case’ en

kunnen ertoe bijdragen dat het stemgedrag van de MEPs door andere drijfveren vorm gegeven

wordt dan normaliter in de literatuur verondersteld.

Via statistische regressieanalyse formuleert dit werk een antwoord op twee onderzoeksvragen. Eerst

en vooral wordt onderzocht welke actor de sterkste controle uitoefent op de parlementsleden.

Zowel de Europese als de nationale partijen hebben beiden instrumenten ter beschikking om de

MEPs te disciplineren. Niettegenstaande de literatuur argumenteert dat de nationale partij de

doorslaggevende actor voor MEPs zijn, toont deze analyse aan dat dit niet geldt op de stemming

rond het CCCTB voorstel.

De tweede onderzoeksvraag gaat na welke determinanten het stemgedrag van MEPs kunnen

verklaren. In lijn met de verwachtingen uit de literatuur constateren we dat de ideologische

positionering van de Europese partijen een doorslaggevende factor zijn. Verder merken we dat ook

het al dan niet behoren tot een nieuwe lidstaat (lid geworden in 2004 of 2007) van belang is, als ook

de economische impact, als berekend in de impactanalyse van Bettendorf et al. (2009). Bovendien

toont dit onderzoek aan dat MEPs die behoren tot de groep die het rapporteurschap op de CCCTB

stemming bezit, minder bereid zijn om het CCCTB voorstel te accepteren.

Dit onderzoek levert een belangrijke bijdrage aan de literatuur door aan te tonen dat, in tegenstelling

tot voorgaande bevindingen onder de gewone wetgevingsprocedure, niet de nationale partijen maar

wel de Europese groepen er tijdens de CCCTB stemming slagen om de meest effectieve actor voor

MEPs te zijn. Verder onderzoek moet nagaan of deze bevindingen geldig blijven op andere bijzondere

wetgevingsstemmingen of zelfs uitgebreid kunnen worden naar stemmingen onder de gewone

besluitvormingsprocedure.

ii

Acknowledgements

First of all, I would like to formulate my gratitude to a number of people who were of crucial

importance to complete this research paper.

I would like to start by thanking my promotor, Prof. Dr. Philippe Van Cauwenberge, for the

assistance, feedback and time to answer my numerous questions during this investigation. Those

insights were very meaningful to me.

Furthermore, I am grateful to Peter Beyne, for the provided methodological assistance.

Finally, I want to express my gratitude for a number of friends and family to encourage me during

this and the previous years. In particular, I want to thank Saar De Smedt for her endless support. I

also like to stress my appreciation for the advice of Nicolas Van De Voorde, Vincent Blommaert and

Pieter De Jaeger when reviewing this thesis.

I would like to end this acknowledgement by thanking my parents, for giving me the possibility to

attend this extra master in Business Economics.

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Table of Contents

Samenvatting .......................................................................................................................................i

Acknowledgements ............................................................................................................................ ii

List of abbreviations ............................................................................................................................ v

List of tables and figures .................................................................................................................... vi

Tables ............................................................................................................................... vi

Figures ............................................................................................................................... vi

Abstract ............................................................................................................................................ vii

1. Introduction ................................................................................................................................1

2. CCCTB .........................................................................................................................................3

3. Voting behaviour in the European Parliament .............................................................................5

3.1. European parties .............................................................................................................5

3.2. National parties ...............................................................................................................6

3.3. Ideology...........................................................................................................................8

3.4. Rapporteurship ................................................................................................................9

3.5. Citizens’ attitude ............................................................................................................ 10

3.6. Enlargement .................................................................................................................. 11

3.7. Individual characteristics ............................................................................................... 12

3.8. Economic impact ........................................................................................................... 12

4. Data and methodology .............................................................................................................. 13

4.1. Research Question 1: ..................................................................................................... 13

4.2. Research Question 2: ..................................................................................................... 14

4.2.1.Independent variables ................................................................................................. 15

A. European group variables ................................................................................................. 15

B. Member State variables .................................................................................................... 15

C. Economic impact .............................................................................................................. 16

D. Individual variables ........................................................................................................... 16

5. Results ...................................................................................................................................... 17

5.1. Research Question 1: European or national principal? ................................................... 17

5.1.1. Composition of EP group and national party ............................................................... 17

5.1.2. Descriptive statistics: Regression 1 .............................................................................. 20

5.1.3. Regression 1 ............................................................................................................... 21

5.2. Research Question 2: Determinants of voting behaviour................................................ 22

5.2.1. Descriptive statistics: Regression 2 .............................................................................. 22

iv

5.2.2 Regression 2 ................................................................................................................ 25

6. Conclusion ................................................................................................................................ 28

References ....................................................................................................................................... VII

Appendix ...........................................................................................................................................XI

v

List of abbreviations

ALDE/ADLE Alliance of Liberal Democrats for Europe CCCTB Common Consolidated Corporate Tax Base CIT Corporate Income Tax Revenue CEE Central and East European Countries EC European Commission ECR European Conservatives and Reformist group EFD Europe for Freedom And Democracy EG-NP index European group vs national party index EPP European People’s Party EP European Parliament EU European Union EU15 Member States who joined the European Union before 2004 GUE/NGL Confederal Group of the European United Left/ Nordic Green Left Greens/EFA Greens/ European Free Alliance MEPs Members of the European Parliament S&D Socialist and Democrats QMV Qualified Majority Voting

vi

List of tables and figures

Tables Table 1: Composition of EP group and national party ........................................................................ 17

Table 2: Index of vote likeness European groups ............................................................................... 18

Table 3: Index of vote likeness national parties ................................................................................. 18

Table 4: Descriptive statistics: regression 1 ....................................................................................... 20

Table 5: Correlation matrix regression 1 ............................................................................................ 21

Table 6: Predictors of voting behaviour: regression 1 ........................................................................ 21

Table 7: Descriptive statistics: regression 2 ....................................................................................... 22

Table 8: Correlation matrix regression 2 ............................................................................................ 24

Table 9: Determinants of voting behaviour: regression 2................................................................... 25

Table 10: Member State line .............................................................................................................XII

Figures Figure 1: 'EG-NP' Index ...................................................................................................................... 19

Figure 2: Loyal/Disloyal National Party ...............................................................................................XI

Figure 3: Loyal/Rebel European group ...............................................................................................XI

vii

Abstract When the European Parliament (EP) approved the amended Common Consolidated Corporate Tax

Base (CCCTB) proposal, the institution expressed its desire for the realization of a framework with

unified and harmonized European tax rules. The CCCTB vote offers a unique research setting, as the

special legislative procedure applies and Member States are confronted with wide varying effects on

their tax revenues. Given this particular context, this investigation examines the drivers of Members

of the European Parliament’s (MEPs) voting behaviour on the CCCTB proposal. By applying statistical

regression analysis, we first investigate if MEPs vote mainly along national party or European group

lines. We demonstrate that the European group and not the national party is the main principal of

MEPs on the CCCTB vote. Secondly, we examine the determinants that structure MEPs’ voting

behaviour. Our analysis shows that the main findings of previous literature on voting behaviour also

apply to the CCCTB vote. Hence, we expose that CCCTB voting is primarily determined by the

ideological position of European groups, by the time of a Member state’s accession to the European

Union (2004, 2007 or earlier) and that the estimated economic impact has a significant effect on

MEPs’ voting behaviour. Furthermore, we demonstrate that the group which holds the

rapporteurship, develops a more critical position towards the CCCTB proposal.

By exposing the effectivity of European groups in shaping MEPs voting behaviour when the special

legislative procedure applies, we question the general assumption that the national party can be

considered as the main principal of MEPs.

1

1. Introduction

The European Parliament (EP) experienced a significant increase in legislative power since its

foundation. Since the ratification of the Lisbon Treaty, the EP can be considered as a vital and

effective legislator in the European Union (EU) (Judge and Earnshaw, 2008). Together with the broad

range of areas where the EP can interfere, the importance of the votes of Members of the European

Parliament (MEP) expanded.

By analysing one specific vote, we investigate the determinants of MEPs’ voting behaviour.

Therefore, we selected the vote on the Common Consolidated Corporate Tax Base (CCCTB) proposal.

With the CCCTB directive, the European Commission aimed to harmonize European tax rules and

hereby take further steps in the European integration process. The amended CCCTB proposal was

approved by the EP, on April 19, 2012 (Votewatch Europe, 2012).

The reason for selecting the CCCTB vote is twofold. First, we can assume that the stakes are relatively

high for Member States. The European Single Market has restricted the range of economic and

monetary policies a Member State can pursue. The impact assessment of Bettendorf et al. (2009)

indicates that, despite the fact that a CCCTB for the EU in general would slightly bear economic

advantages, the effects differ for each country. Luxembourg and Malta for example, would be

confronted with a negative welfare effect, where the CCCTB implementation would be beneficial for

countries like Belgium or Estonia (Bettendorf et al., 2009, p. 133).

Keeping this in mind, it is plausible to assume that Member States were carefully monitoring the

evolutions on this debate. The latter could imply a greater involvement of national parties and a

possible conflict with their European counterpart (Gabel and Hix, 2002).

Second, we can empirically test the reliability of the literature’s main findings on voting behaviour,

for the CCCTB vote, given the particular salient context.

Consequently, this analysis tries to contribute to the literature by addressing two main research

questions. With our first research question: “Who is the main principal of a MEP on the CCCTB

vote?”, we aim to identify the decisive principal for a MEP on the CCCTB vote. Previous literature

does not suggest a clear-cut answer to this question. In general, European party groups are

considered as effective in disciplining their members (Hix et al., 2007). However, on a salient

proposal like the CCCTB, interference of national parties could emerge.

Secondly, by using statistical logistic regression, we provide an answer to our second research

question: “which variables determine MEPs’ voting decisions on the CCCTB proposal?”.

2

The article is organised as follows. First, we provide some background information about the CCCTB

vote in section 2. Next, in section 3, we present the literature overview with the relevant discussions

and variables in the study of EP’s voting behaviour. Section 4 introduces the used methodology. After

that, the descriptive data and results of our analysis are exposed in section 5. Finally, in section 6, we

formulate a conclusion of this work with the implications of our findings and recommendations for

future research.

3

2. CCCTB

Before we start this analysis, we would like to underline the specific characteristics of the CCCTB

vote.

With the CCCTB proposal, the European Commission (EC) aimed to take further steps towards the

integration of a European Single Market (Coppens et al., 2012). In particular, the EC tried to address

the issue of tax obstacles for companies operating within the EU. Under the CCCTB, one single set of

rules would be applicable to compute the individual tax bases of companies with activities in the EU,

which would then be added to a consolidated tax base. The consolidated tax return can be allocated

to the individual companies by an apportionment formula. 1 This way, Member States still retain their

authority to apply their own tax rate. In addition, multinationals are able to use one, cross-EU

calculation system for their tax bases. Whereas in the former situation, each Member State had

designed its own legislative framework, resulting in 27 different calculation procedures within the EU

(Coppens et al., 2012; Roggeman et al., 2015; European Commission, 2011).

The legislative framework of this proposal has considerable consequences for the EP’s power on the

CCCTB vote. The special legislative procedure is applicable to this proposal as it is initiated by the EC

and ‘directly affects the establishment of functioning of the internal market’ (European Union, 2012,

p. 49). Under this procedure, the Council of Ministers needs to decide unanimously and the EP’s role

is limited to a consultative one. Whereas, under the co-decision procedure, the Council of Ministers

can decide by Qualified Majority Voting (QMV) and the proposals are adopted jointly by the EP and

Council of Ministers (Vos, 2011). As a result, the EP has no co-decision power concerning the CCCTB

vote.

This is an important remark for the possible consequences on voting behaviour in the EP. In

comparison with the co-decision procedure, the impact of MEPs on the eventual outcome is limited.

The latter can have a significant influence on the motives and incentives of MEPs’ voting behaviour.

Costello and Thomsen (2010) have indicated that the legislative framework can facilitate the relative

power of certain actors in the EP. Furthermore, as the ultimate decision needs to be made by the

Council, national interest could become more salient for MEPs (Kohler-Koch, 1997).

The impact assessment of Bettendorf et al. (2009) has measured the consequences of the CCCTB for

each Member State. That way, MEPs have a clear idea about the impact of the CCCTB on their

country. As Roggeman et al. (2015) have examined, this impact assessment had a significant

influence on MEPs’ voting outcomes. This could be interpreted as an indicator that national

1 This apportionment formula takes the labour costs, sales and tangible assets of these companies into account

(Roggeman et al., 2015; European Commission, 2011)

4

consequences do matter for salient issues and have to be taken into account when analysing the

CCCTB vote.

On the one hand, national parties who are member of their respective national government could

have an incentive to influence their MEPs. On the other hand, opposition parties could be aware of

this and could try to influence their MEPs’ behaviour too. Therefore, it is interesting to investigate if

national parties in general had a significant influence on voting outcomes for the CCCTB vote.

Hence, it should be clear that the CCCTB vote is a critical case in examining MEPs’ voting behaviour.

Due to the legislative context and national implications, MEPs’ voting behaviour could be

characterized by different incentives in comparison with other less salient votes.

5

3. Voting behaviour in the European Parliament

The EP is a unique and interesting area for the study of voting behaviour. The complexity of the party

system is typically higher, because MEPs represent both their national and supranational parties (Hix,

Noury and Roland, 2006).

In 2012, the EP consisted of 754 MEPs who represented 209 national parties from 27 different

Member States. These national parties have decided to form seven European party groups2

(Votewatch Europe, 2012).

As mentioned earlier, the EP has experienced a dramatic shift in legislative power and policy domains

since its foundation. Due to this increase in power and its multidimensional peculiarities, EP voting

has been thoroughly examined (Faas, 2003; Hix, 2002; Hix, Noury and Roland, 2006; 2007; Kreppel,

2002; Rasmussen, 2008). With the institutionalization of EP groups and the widened legislative

abilities of the EP, national and European parties both have motives to structure and discipline their

members. However, these instructions are not always compatible with each other (Judge and

Earnshaw, 2008; Vos, 2011).

First, we deal with this possible tension between the national parties and their European

counterparts.

3.1. European parties

Since the foundation of the EP, European political groups were created. They have been organized

along their ideological policy positions. In the plenary, this group classification becomes visible, as

they are seated together from left to right, according to their ideological position. On the extreme

left, we find the GUE/NGL, on the extreme right, we find the EFD and independents (Vos, 2011).

There are a number of reasons why European party groups have emerged. One important incentive

was the desire to overcome a collective action problem. Due to the high amount of workload,

complexity and broad ranges of policy dimensions, a division by 209 parties would lead to an

unmanageable situation in Parliament. It would become impossible for each national party or each

country to form a particular coalition for every single vote. Hence, this complexity is reduced by the

European party groups (Scully, 2000).

As the EP is not confronted with a stable government/opposition structure, an approach where

simple majorities can be found for each vote is recommended (Earnshaw and Judge, 2008; Hanley,

2008). Furthermore, with the increase in legislative power and the subsequently enforced majority

2 MEPs from national parties who are no part of a group are so-called ‘Non- Attached’ or ‘Independent’ MEPs.

6

rules, the EP was forced to act cohesively if it did not want to be marginalized and overcome by other

EU institutions. This has resulted in an empowered alliance of EP groups across ideological extents

(Kreppel, 2002).

European groups possess a range of instruments to structure and discipline their MEPs.

Voting instructions are handed out by the so- called ‘whips’. They issue the groups’ position on every

single amendment and denote which votes are vital. After the voting has been conducted, the

outcomes are analysed and reported to the party executive.

In general, the group members follow this advice. However, this mechanism differs widely from

common practice in national parliaments. As mentioned earlier, without the government/opposition

structure, no systematic majority needs to be formed. The latter implies more freedom and flexibility

for the MEPs. In addition, the presence of national, regional and sectorial interests makes deviations

from the unified European party line more feasible (Corbett, Jacobs and Shackleton, 2011; Hix et al.,

2007).

Secondly, the groups have a key influence in the internal working process and organization of the EP.

European parties nominate loyal MEPs for the main office positions, like rapporteurships and

committee assignments. Career endeavours can be rewarded within the group, with a position in the

party leadership. By neglecting the groups’ position, MEPs harm their acquired prestige and could be

bypassed in future assignments. Furthermore, European parties also shape the parliamentary agenda

and draw up the speaking time in the plenary (Hausemeer, 2006; Hix et al., 2007; Raunio, 1997;

Whitaker, 2005)

It is important to remark that a persistent minority of MEPs refuses to form a transnational group.

Traditionally, those independents are found at the more extreme ends of the political spectrum. In

general, they oppose to the EU as an institution (Kreppel, 2002; Benoit and McElroy, 2007).

3.2. National parties

On the other hand, national parties have a broad range of instruments at their disposal too.

As EP elections are held on national base, the entrance ticket to this institution has to be earned on

the national level. National parties can decide exclusively on the shape of the recruitment procedure,

the candidate selection on different voting lists and possible re-election positions (Gabel and Hix,

2002; Raunio, 1997). In addition, MEPs who are looking for future policy positions do not necessarily

limit their options to the European level (Scarrow, 1997).

In a nutshell, it is clear that, once in Parliament, European groups own important instruments to

reward loyal MEPs. However, to (re)become member of the EP, the national party has the last say. It

7

is clear that the available options for national parties are more powerful than those for the European

groups.

Together with the increase in the EP’s legislative power, national parties faced a new stimulus to

shape their MEPs’ voting decision. As the scope of policy domains enlarged, the interest of national

delegations is possibly triggered. Due to the strengthened EP, there are both for national as for

European groups incentives to exert additional influence on their MEPs (Hix et al., 2007).

The earlier mentioned arguments were empirically confirmed. Hix et al. (2007) demonstrated that in

general, the national party is the decisive principal for the MEPs’ voting outcomes. With their analysis

of 25 years of roll call votes in the EP, they indicated that on average, 1/3th of the votes are formed

by the European group, while the other 2/3th are structured by the national party (Hix, 2002; Hix et

al., 2007). Faas (2003) agrees and concludes that in cases of conflict, the national party becomes the

main principal for parliamentarians. Despite this, apparently clear pattern, the groups in the EP

succeed in reaching enormous cohesiveness levels.

It is remarkable that, in 90% of the votes, there is no conflict between the national delegations and

European groups’ position. However, this large consensus can fade away when certain votes have

considerable implications at the national level (Corbett, 2003). In these circumstances, the literature

is less straightforward.

Whitaker (2005) argues that the evolvement of the EP’s legislative power has indeed caused a

greater concern for national parties towards their MEPs’ voting outcomes. Other authors also

suggest that the voting behaviour is largely determined by national party preferences (Laible, 2008).

In fact, it can be expected that national parties have a larger influence in cases of conflict with the

European group (Hix, 2002). An interesting finding has been presented by Rasmussen (2008). She

suggests that MEPs have strong links, both with their national and European parties, but that these

links differ in nature. While MEPs perceive to have a stronger attitudinal connection with their

national party, there seems to be a stronger regulatory tie with their European group. In other

words, MEPs feel inclined to follow their national parties, but the European groups are the most

effective in constraining MEPs voting behaviour (Rasmussen, 2008). It is clear that further research

has to be done to obtain a better understanding of this issue.3

As a matter of fact, research has typically focused on the issue of country politics versus

transnational party politics. Many authors have shown that national preferences have little impact

on MEPs’ voting outcomes (Hix et al., 2006; Noury, 2002; Noury and Roland, 2002; Scully, 2000).

3 To the best of our knowledge, only Faas (2003), Hix, Noury and Roland (2006, 2007), Whitaker (2005) and

Rasmussen (2008) have empirically explored this issue, without the case of conflict as focal point of research.

8

However, in certain circumstances some national blocks4 will still vote against their European group.

The latter only occurs when an issue is extremely salient for a particular country (Kreppel and

Tsebelis, 1999).

These results suggest that transnational groups are more effective in disciplining their MEPs than

countries but this finding can be undermined on national salient issues.

However, research is less straightforward when the relationship between a MEP and his/her national

party and European group is investigated. Both actors have their instruments to discipline the

parliamentarians. The majority of research proposes that national parties remain MEPs’ main

principal. European parties are however becoming more cohesive, while countries are confronted

with a decrease in cohesion (Hix et al., 2007). Furthermore, as the special legislative procedure

applies to the CCCTB vote and the EP only has a consultative role, national parties could evaluate the

MEPs’ voting outcomes as less relevant. Consequently, they could focus their efforts entirely on the

voting behaviour of members of the Council of Ministers. The latter could imply that European

parties are considered as more influential as principal for MEPs on the CCCTB vote.

Thus, we investigate which principal is the most effective in instructing its MEPs on the CCCTB vote.

In accordance with the majority of the research, we hypothesize that the national party will be the

main principal for MEPs.

European parliamentary politics also has a lot of similarities with national parliaments. The main

determinants are discussed in the next part.

3.3. Ideology Like in national politics, ideology is a main driver of policy preferences in EP politics. However, EP

politics is structured around two ideology dimensions. In accordance with national politics, the most

important dimension is the classic left-right positioning. Within the EP, parties who are classified at

the left of the political spectrum generally prefer a more strict market regulation and tax policy,

while parties at the right end oppose to it. Second, a pro/anti-Europe dimension can be identified

among EP parties. So-called pro-European parties are generally advocates of an enhanced EU

authority on European integration issues, while anti-European parties oppose to it. Centrist parties

are generally seen as pro-European parties, where parties at the extremes are classified as anti-

European (Benoit and McElroy, 2007; 2012; Gabel and Hix, 2002 ; Hix, 2006, Hix and Noury, 2009).

4 By national blocks we mean the countries’ general position. The difference with the national party needs to

be emphasized.

9

However, there has been an intense debate in the literature about the interrelation of these two

dimensions. Advocates of the regulation model claim that they are related with each other.

Consequently, the European integration dimension can be merged into the left-right dimension

(Hooghe et al., 2002). In contrast, the Hix-Lord model considers the two as independent and

unrelated to each other. Hix has acknowledged that the positioning on the economic and social left-

right dimension is the main observed driver of voting in the EP. Even when national interests are at

stake, left-right positioning remains to have a significant influence on the MEPs voting decisions. The

Hix-Lord model emphasizes the importance of the pro/anti-Europe dimension but conceives them as

less salient than the left-right dimension (Hix, 2002; Hix et al.,2006; 2007).

As a consequence, we expect that MEPs are more likely to oppose to CCCTB when their party is

classified at the right end of the political left-right dimension. Concerning the pro/anti-Europe

dimension, we assume that MEPs from parties who classify themselves at the extreme ends of this

dimension are more likely to oppose to CCCTB, while MEPs from centrist parties are more likely to

vote in favour of the proposal.

3.4. Rapporteurship

Another particularity of the EP is the position and function of the rapporteurship. Similar to the

practice in national parliaments, the EP has been subdivided in committees along different policy

dimensions.

When the European Commission initiates a legislative proposal, it is immediately provided to a

specific parliamentarian committee. Within the committee, a rapporteur, who prepares a report with

amendments on this topic, is appointed (Vos, 2011).

Rasmussen (2013) emphasized that: ”rapporteurships are among the most important offices held by

MEPs”. The appointed rapporteur possesses a powerful asset to shape policy matters. He/she

acquires a unique information benefit, as they lead the negotiations on the issue, in committee,

plenary as with other institutions (Rasmussen, 2013).

The assignment procedure is organised as an auction, where the European party groups compete for

the rapporteurships. Each group starts with a certain amount of points, which they can use to bid for

the rapporteurship on a certain report. These points are divided in accordance to the size of the EP

group (Farrel and Herritier, 2004; Yordanova, 2011; Vos, 2011).

Recent research has demonstrated that rapporteurs obtain an extended influence over legislative

outcomes. In general, rapporteurs are experienced and respected loyal MEPs within their EP group.

Consequently, these parliamentarians could use their resources to manipulate the outcome of the

10

legislative process (Benedetto, 2005; Costello and Thomson, 2010; Farrel and Herritier, 2004;

Yordanova, 2011).

In fact, Costello and Thomson (2010) identified that, under the consultation procedure, rapporteurs

are more able to use their agenda-setting and manipulating powers. Since, the EP faces considerable

constraints under the consultation procedure in comparison with the co-decision procedure, there is

less involvement of other parliamentarians, which paradoxically empowers the rapporteurs.

In other words, rapporteurs are, under the consultation procedure, effective in biasing the agenda

and legislative outcomes to a certain degree.5 Moreover, as Costello and Thomson (2010)

demonstrate, rapporteurs’ motives seem to be driven by national interest. This remarkable result

does not correspond with the earlier presented finding of Hix et al. (2007) which states that voting

behaviour in the EP is primarily along European group lines rather than national ones. However, in

these complex legislative matters, EP’s party leaders do not control their rapporteurs abundantly. As

a result, rapporteurs could be more likely to respond to their other principals, namely the national

agents (Costello and Thomson, 2010).

Hence, we can expect that, on the CCCTB vote, the position of the rapporteur will have played an

important role in modelling MEPs’ voting outcomes. In addition, Lindberg (2008) has shown that the

EPP is the only EP group that is able to sanction disloyal members when allocating reports.

Keeping the above argumentation in mind, it is interesting to examine if the rapporteurship exerts an

influence on MEPs’ voting decisions on the CCCTB proposal. However, we cannot formulate clear

expectations about the direction of influence.

3.5. Citizens’ attitude

We earlier mentioned that no evidence has systematically demonstrated a significant relationship

between national preferences6 and MEPs’ voting decisions. However, when we shift the focus from

these general national preferences to citizens’ attitude towards European integration, the literature

demonstrated evidence of a different pattern (Gabel and Anderson, 2002; Marks And Steenbergen,

2002).

The European Commission has been monitoring the public opinion in Member States towards the EU

policy on a regular base. The results of these surveys are found in the so-called Eurobarometer.

Eurobarometer data presents coherent patterns of mass opinions towards European integration on

the country level. In accordance with theories of representation (Devos et al., 2012) it can be

5 For more information about rapporteurs’ influence on agenda-setting powers, see Costello and Thomson (2010). 6 With national preferences, authors investigated in the relationship between the cohesion of national groups.

In this investigation, citizens’ attitude is used as measure for national preferences.

11

assumed that these attitudes could exert an influence on MEPs’ voting behaviour. Thus, the citizens’

attitude on Eurobarometer data could be an important parameter for modelling MEPs’ voting

actions.

Therefore, we expect that MEPs from countries with a positive attitude towards European

integration are more likely to vote in favour of CCCTB, while MEPs whose country expresses a

negative attitude towards EU integration are more likely to vote against it.

3.6. Enlargement

With the enlargement of the EU in 2004 and 2007 twelve new Central and East European countries

(CEE) became Union Member States. Critics were concerned about forthcoming possible negative

implications for the European institutions. They feared an unsustainable situation, where the

different Member States would not be able to cooperate or act cohesively with each other. However,

extensive research suggests that most of these concerns did not occur. As EU institutions, and in

particular the EP adapted well to this expansion, the EP’s power balance remained quasi unaffected

(Benoit and McElroy, 2012; Pollack, 2009; Farrel, Hix and Scully, 2012). In other words, EP’s voting is

still more along transnational party lines than country lines and the left-right dimension remains the

main determinant of voting outcomes (Hix and Noury, 2009).

However, there is evidence of subtle differences between the voting patterns of MEPs from new

Member States and MEPs from old Member States.7 On salient issues, where national interests are at

stake, MEPs from new Member States tend to vote more along national lines than their colleagues

from the EU15 (Hix and Noury, 2009). Voeten (2009) has confirmed this view by presenting evidence

that, among the CEE Member States, national voting is indeed slightly of greater importance.

In particular, it is demonstrated that new MEPs from the old Member States adapt more easily to the

EP procedures and new European principals than new MEPs from new Member States do.

New MEPs from new Member States rely stronger to their national parties in the beginning of their

mandate. However, over time, new and old MEPs’ behaviour converges and at the end of the term,

these differences disappear (Lindstädt et al., 2012). Furthermore, it has to be emphasized that, even

with the extended adaption process of new Member States’ MEPs taken into account, voting along

national preferences keeps decreasing (Hix et al., 2007). As the adaptive period is larger for countries

who obtained their membership in 2004 compared to the newer Member States of 2007, this effect

of national voting could still be more salient for Bulgarian and Romanian MEPs. In addition, research

7 Where Member States who joined the EU before 1995 are appointed as ‘old’ Member States. New Member

States entered the EU at the enlargement operations of 2004 and later.

12

indicates that MEPs from new Member States are less likely to vote in favour of EU taxes

(Heinemann, 2009).

Thus, we hypothesize that MEPs from new Member States are more reluctant to the CCCTB vote.

Moreover, we expect that Bulgarian and Romanian MEPs will be more sceptical than MEPs who

originate from countries who became Union Members in 2004.

3.7. Individual characteristics

As Hix (2002) argues, individual preferences of MEPs are largely similar to the preferences of their

European groups. For the sake of simplicity, the orientation on a left-right dimension and pro/anti-

Europe dimension is only considered at the European group level in this investigation.

However, when examining voting behaviour on economic issues, the amount of a MEPs’ experience

and political specialization can be considered as important variables (Heinemann, 2009). As theories

of socialization predict, the time in parliament influences the behaviour of parliamentarians

(Beauvallet and Michon, 2010). In line with these assumptions, Heinemann (2009) has demonstrated

that MEPs who hold their office longer, converge more to the traditional European group position.

Concerning political specialization, research concentrating on tax and economic issues indicates that

specialized MEPs tend to be more sceptical towards proposals of an EU tax (Heinemann, 2009).

Despite these clear expectations, Laible (2008) argues that individual characteristics are no main

determinant of voting outcomes. Previous research on CCCTB voting has also demonstrated that

these individual characteristics did not significantly influence voting outcomes (Roggeman et al.,

2015).

Therefore, we investigate if political specialization and experience have had a significant influence on

CCCTB voting behaviour. However, we do not formulate specific directional expectations.

3.8. Economic impact

Concerning the CCCTB vote, a noteworthy variable has to be taken into account. During the

legislative discussion on the CCCTB, an economic impact assessment of Bettendorf et al. (2009) was

provided to the MEPs. Research of Roggeman et al. (2015) has proven that this impact analysis had a

significant effect on MEPs’ voting outcomes on this legislative proposal. They demonstrated that the

chances to vote in favour of the CCCTB proposal increased, when the impact on CIT revenue was

higher for a particular country.8 Therefore, it is recommended to take the economic impact into

account, when explaining voting behaviour on the CCCTB proposal.

8 The impact analysis of Bettendorf et al. exposed the impact on CIT Revenue, GDP and employment for the

different member states (Bettendorf et al., 2009; Roggeman et al., 2015).

13

4. Data and methodology

The final vote on the CCCTB proposal, held on April 19th 2012, was a so-called roll call vote. Normally,

MEPs vote by hand. However, when the vote is tight, that is when the gap between the yes and no

votes is narrow, electronic voting is used (Vos, 2011). Hereby, MEPs’ voting outcomes are recorded

and published for online consultation by VoteWatch Europe (2012). The latter makes a thorough

analysis on the CCCTB voting behaviour possible.

As this investigation aims to address two main research questions, this paper is divided into two

parts. First, we examine if MEPs are more influenced by voting instructions from the national parties

or European groups on the CCCTB proposal.

4.1. Research Question 1 In order to determine MEPs’ main principal, we begin with exploring the cohesiveness of the national

parties and European groups. The cohesiveness can be seen as a first indication for effective vote

instructing power. Therefore, we computed an index of vote likeness, like Rice (1925).9 This index will

be 1 if every MEP of a group or national party voted the same way on the CCCTB proposal. It equals

zero if the votes are equally divided between the two possible voting outcomes.

In addition, we also constructed a ‘European group vs national party’ index (EG-NP). The EG-NP index

can be used to determine the decisive principal of MEPs in cases of conflict between the national

party and European group. For the latter index, we identified the voting position of these principals

on the CCCTB vote. Here, the national party’s voting position equals ‘yes’, if more than 50% of the

national party voted in favour of the CCCTB proposal and ‘no’ otherwise. National parties with less

than three MEPs were not taken into the analysis. Similarly, the European groups’ position equals

‘yes’ when more than 50% of the group supported the CCCTB proposal and ‘no’ otherwise. Then, for

the computation of the EG-NP index, we first analysed if the voting outcome of a MEP is in

accordance with the voting position of its principal. Hence, when a MEP’s outcome corresponds to its

national party position, the national party line will be one and zero otherwise. The same logic applies

for the computation of the European group line. As a consequence, when there is no conflict, the EG-

NP index equals zero. In case of conflict, the index will be 1 if MEPs follow the European groups’

position. The index equals -1 when the national party is the main principal.

However, this EG-NP index only determines the decisive principal when the two principals do not

agree on the same voting outcome. To examine if a MEPs’ voting decision is primarily determined by

9 As the dependent variable is a dummy, the Agreement Index of Hix et al. (2007) is not applicable to this

analysis. Therefore, we apply the framework of Rice (1925), which is suitable for dummy variables. It is measured as the absolute difference between yes and no votes dived by the sum of yes and no votes.

14

its national party or European principal in all of the cases, we apply a statistical regression analysis

like Hix et al. (2007).

Therefore we use the following regression model:

Votem = β1 position national partym + β2 position European groupm + εm

In this regression, each β is a regression coefficient, ε is an error term and each MEP is labelled by m.

From the 754 MEPs, we retain 471 MEPs for this regression. The data loss is explained by the

exclusion of non-participators (n=94), abstentions votes (n=34) and independent MEPs (n=32).

Furthermore, for the computation of the national party’s voting position, national parties with less

than 3 MEPs were not taken into the analysis.10

Our data sample retains 355 MEPs who voted in favour of the proposal and 116 MEPs who voted

against it. The ordinal dependent variable is the vote choice of MEPs, which has two possible

outcomes, namely ‘Yes’ or ‘No’. We follow the method of Hix et al. (2007) for the computation of the

two independent variables. As a consequence, we measure the first independent variable, the voting

position of the party, “as the proportion of the MEPs’ national party that voted the same way as the

MEP”. Second, the voting position of the European group is gauged “as the proportion of the MEPs’

European group that voted the same way as the MEP” (Noury and Roland, 2002; Hix et al., 2007).

4.2. Research Question 2: In order to address the second research question, we examine which variables are the main

determinants of MEPs’ voting behaviour on the CCCTB proposal. Therefore, vote is again treated as

dependent variable. The following regression model is used:

Votem = β0 + β1 Group_Left_Rightm + β2 Pro_AntiEuropeanm + β3 Rapporteurshipm + β4 Eurobarometerm

+ β5 EU2004m + β6 EU2007m + β7 Economic_Impact_CITm+ β8 Mandatem + β9 Agem + β10 Educationm

+ β11 Amendmentsm +β12 Genderm + εm

Similar to the first regression, each β is a regression coefficient, ε is an error term and each MEP is

labelled by m. This time, we only exclude the non-participators (n=94), the abstention votes (n=34)

and the independents (n=32).11 Consequently, we retain 598 MEPs for our analysis, who possess

complete information for all variables who were taken into the second regression. 155 MEPs voted

10 For the calculation of the national party and European groups’ voting position, we follow the approach of Hix et al. (2007). Consequently, a national party needs to have at least 3 MEPs to make this computation possible. 11

Again, in line with Hix et al. (2007) we treat the dependent variable as a dummy variable. We exclude the ‘Independents’ because they cannot be considered when assessing the European party position. Furthermore, we deleted the Luxemburg MEPs, as they can be considered as an outlier because of their CIT revenue impact.

15

against the CCCTB proposal, 443 voted in favour of it. In the following section we present the

definition of the independent variables:

4.2.1. Independent variables

A. European group variables

As mentioned in the literature review, ideology can be structured around two dimensions, namely

the left-right dimension and the pro/anti-Europe dimension.

The categorical variable ‘EP Group Left-Right’ classifies the seven political groups in the EP, whereby

1 is seen as the most left and 7 as the most right oriented group.12

For the pro/anti-European integration dimension, we follow the argumentation of Hix and Noury

(2009). They argue that parties at the extremes can be considered as rather anti-European and

parties concentrated at the centre can be regarded as more pro-European. Therefore, we construct a

dummy variable, where the dummy equals one for the centrist parties and zero for the parties who

are located at the extremes.13

The rapporteurship is the last variable on the European group level. This dummy variable equals one

if the EP group held the rapporteurship and zero otherwise.

B. Member State variables

As an indicator for the citizens’ support for the EU, we use the variable ‘Eurobarometer’. Following

the approach of Roggeman et al. (2015)14, we calculated an index for each MS on the basis of

Eurobarometer data (European Commission, 2011b). In the regularly held Eurobarometer surveys,

citizens need to respond to the following question: “Generally speaking, do you think that your

country’s membership to the EU is (a) a good thing, (b) a bad thing; ((c) neither good nor bad”.

For the examination of the possible influence of new Member States, we computed two dummy

variables.

‘EU 2004’ equals one if the country became a Member State in 2004 and zero otherwise.

‘EU 2007’ equals one if the country became a Member State in 2007 and zero otherwise.

By this, we want to explore possible differences within the group of members who gained access

after the 2004 enlargement.

12

According to the mapped policy positions of EP groups by Benoit and McElroy (2007; 2012) and Hix and Noury (2009), we classify the groups as followed: 1: GUE/ NGL, 2. Greens/EFA 3. S&D, 4. ALDE/ADLE, 5. EPP, 6. ECR, 7.EFD 13 The more centrist parties are S&D, ALDE/ADLE and EPP. The parties at the extreme left, GUE/NGL and Greens/EFA and at the extreme right, ECR and EFD are classified as more anti-European groups. 14

We follow the method of Roggeman et al. (2015) where they state that : “Based on the study of Nogueira and Veiga (2010), a popularity index can be computed for each Member State, that is defined as a-0.5-b.”

16

C. Economic impact

We include one variable to measure the economic impact into our model. Similar to Roggeman et. al

(2015)15, we use the study of Bettendorf et al. (2009) which published the change in Corporate

Income Tax (CIT) revenue of a mandatory CCCTB for each Member State. This change in CIT revenue

is measured as a percentage for each country (Roggeman et al., 2015, p.9).

D. Individual variables16

Experience is gauged by the dummy variable ‘mandate’, which equals one if a MEP has two or more

mandates and zero otherwise. Another proxy for experience is ‘age’, which is computed as: 2012

minus the MEPs’ year of birth.

Political specialization is also measured by two variables. The educational background is taken into

account. ‘Degree’ is a dummy variable that equals one if MEPs possess a law or economic degree and

zero otherwise. ‘Amendments’ is a second proxy for political specialization on the CCCTB topic and is

measured as the amount of amendments made on the CCCTB proposal by a MEP.

We also investigate the possible relationship with gender, as this information is easily available.

‘Gender’ is a dummy variable that equals one if a MEP is male and zero when the MEP is female.

15

Roggeman et al. (2015) assessed the influence of the economic impact by three distinct variables. In this paper, only the CIT revenue is used as a proxy for economic impact. 16 For the operationalization of the individual variables, we use the framework of Roggeman et al. (2015).

17

5. Results

5.1. Research Question 1: European or national principal?

The first research question we address is: “Who is the main principal of a MEP on the CCCTB vote?”

Since we are going to compare the European groups with the national parties, we first examine the

composition of these two principals.

5.1.1. Composition of EP group and national party

Table 1: Composition of EP group and national party

As exposed in Table 1, our sample includes 63 national parties. The largest party, the German ‘CDU’ is

composed of 31 MEPs.17 On average, each national party has seven MEPs. In comparison, there are

only seven European groups, with an average of 67 MEPs per group. The smallest group, the

GUE/NGL, is comprised of 14 MEPs in this analysis. The largest group is the EPP, where 195 MEPs are

recorded into our data sample.

Before we examine the results of the statistical regression analysis, we explore the cohesiveness of

the national parties and European groups on the CCCTB vote. The cohesion rates can be considered

as an indication for the effectiveness of the principals’ ability to shape MEPs’ voting behaviour. In

particular, high cohesion numbers are an indicator of effective voting instructions and low cohesion

numbers denote the opposite. As mentioned earlier, we apply Rice’s index of vote likeness (1925) to

measure the cohesiveness in CCCTB voting. Table 2 and 3 illustrate the results for national parties

and European groups.

The index of vote likeness will be 1 if every MEP of a group/national party voted the same way on the

CCCTB proposal. It equals zero if the votes are equally divided between the two outcomes. To make

things clear, we present the percentages instead of the absolute numbers.

17

The loyalty/disloyalty numbers and composition of each European group and national party are presented in “Appendix 1”.

Mean (#MEP) Minimum (#MEP) Maximum (#MEP) Total Parties

National parties 7 3 31 63

European groups 67 14 195 7

18

Table 2: Index of vote likeness European groups

Table 3: Index of vote likeness national parties

N=471 Christlich-

Soziale

Union In

Bayern

FMPSKDN Movement

for Rights

and

Freedoms

Partido

Popular

Sojusz Lewicy

Demokratycznej

Soltumatu Others

(57)

Yes 7 1 2 22 3 2 318

No 1 11 1 1 2 1 99

N= 8 12 3 23 5 3 417

Rice's

Index

75% 83,33% 33,33% 91,30% 20% 33,33% 100%

Average Cohesion 95,81%

Rice’s index shows that, on average, European groups reach a high cohesiveness level of 77.27% on

the CCCTB vote. Thus, more than 3 out of 4 MEPs within a European group voted the same way on

the CCCTB proposal. Table 2 demonstrates that the EFD is the least cohesive, with a cohesion rate of

less than 6%. An interesting result is that the EPP only reaches a cohesion rate of 51.79%. This is

important to take into account, as the EPP held the rapporteurship on the CCCTB vote. The

subsequently possible information benefit seems to cause higher numbers of disunity within the EPP

group in comparison with other groups, as the latter present cohesion rates of above 90 %.

National parties reach even higher levels of cohesion. 57 parties reach a cohesion level of 100%,

indicating that every MEP within these national parties made the same voting decision. As exposed in

table 3, the Polish ‘Sojusz Lewicy Demokratycznej’ is the most divided party, with a cohesiveness

level of 20%. On average, national parties succeed in reaching a cohesion rate of almost 96%. This

N=471 GUE/NGL GREENS/EFA S&D ALDE/ADLE EPP ECR EFD

Yes 14 0 5 2 47 39 8

No 0 29 129 41 148 0 9

N= 14 29 134 43 195 39 17

Rice’s

Index

100,00% 100,00% 92,54% 90,70% 51,79% 100,00% 5,88%

Average Cohesion 77,27%

19

8 MEPs 2%

414 MEPs 88%

49 MEPs 10%

National Party

No conflict

European Party

could be a first indication that MEPs tend to agree more with the national party position when

adopting a certain voting decision. However, the main conclusion from the index of vote likeness is

that both European groups and national parties can be considered as effective voting instructors.

Another way to evaluate the effectiveness of the principals’ voting instructions is by examining the

cases of conflict between the European group and the national party. When there is no conflict

between the group and the national party, both parties can be considered as effective instructors. By

examining the critical cases, where national parties and European groups do not agree on voting

outcomes, we can denominate the main principal for MEPs on the CCCTB vote in these cases of

conflict. This could also be an indicator of effectiveness. Therefore, we computed an ‘European

Group vs National Party’ (EG-NP) index.

Figure 1 demonstrates the ‘EG-NP’ index. In almost 90% of the cases, no conflict between the

national party and European group occurs. This remarkable result illustrates that, even in a highly

salient case like the CCCTB vote, with considerable implications for Member States, large consensus

between the two principals can still be achieved. Hence, the general assumption that the large

agreement levels between European groups and national parties fade away in salient cases, is not

confirmed (Corbett, 2003). This finding is an indication that, in contrast to the majority of previous

research, EP voting on salient issues is similar to voting on more common and less contested topics.

This result could have considerable implications about the rationale of voting behaviour on salient

votes in the EP.

Furthermore, the ‘EG-NP’ index identifies 57 critical cases where the MEPs’ principals do not agree

with the party position. In the majority of these cases, the European group seems to be the decisive

actor. 49 MEPs follow their European group line, where only 8 MEPs conform to their national party

Figure 1: 'EG-NP' Index

20

line. Thus, contradictory to our expectations and earlier findings from Rice’s index, European groups

seem more successful in instructing their MEPs’ voting position than the national party when conflict

between these two principals occurs.

However, this EG-NP index does not distinguish the decisive principal when the two principals agree

on the same voting outcome. To identify the main predictor of voting instructions in all of the cases,

we apply a statistical regression analysis.

5.1.2. Descriptive statistics

Table 4 presents the descriptive statistics of the variables from the regression.

Table 4: Descriptive statistics: regression 1

From table 4, it can be seen that on average, 80.2% of the MEPs voted in accordance with the voting

position of their European group. Even though this is a remarkable high number, MEPs seem to vote

even more in accordance with their national party’s voting position, with an average of almost 98%.

However, keeping the composition of these two principals in mind, the larger number of MEPs per

group in comparison with the average MEPs per national party has to be taken into account. Thus,

the descriptive statistics indicate again that both European groups and national parties succeed in

structuring their MEPs’ voting outcomes effectively. Hence, the latter finding confirms the

expectations from previous research that both European groups and national parties are effective in

instructing their MEPs voting behaviour (Earnshaw and Judge, 2008; Hausemeer, 2006; Hix et al.,

2007).

Lastly, table 5 presents the correlation coefficients.

N=471 Mean SD Min Max

Vote 2,51 ,863 1 3

Voting position

EP group

,8020 ,2448 ,0373 1

Voting position

national party

,9771 ,1056 ,0435 1

21

Table 5: Correlation matrix regression 1

In order to identify multicollinearity, we examine the correlation coefficients of the variables in the

regression. Coefficients with a value greater than 0.7 can be interpreted as problematic and are an

indication of multicollinearity. As exposed in table 5, no problems of multicollinearity arise in this

regression model.

5.1.3. Regression 1 In line with the work of Hix et al. (2007, pp. 132-145), we apply a linear regression to estimate the

influence of the two principals on MEPs’ voting decision. As stated by Hix et al. (2007, p.144):

"The coefficients can be interpreted as the proportion of the total variation in MEPs’ voting behaviour

that is independently explained by European groups or national parties”.

Table 6 presents the results of the statistical regression analysis.

Table 6: Predictors of voting behaviour: regression 1

European group National party N= R²

Coeff. T-stat Coeff. T-stat.

CCCTB Vote 0,819*** (11,630) 0,084 (1.199) 471 0,802

The dependent variable in this regression is a MEPs’ voting decision (No/Yes). The two independent

variables are, first, the voting position of the European group and second, the voting position of the

national party. Parameters of the model are estimated by linear regression with robust standard

errors. T-statistics are presented in parentheses. *** significant at 0.01 level.18

The coefficients show that, on the CCCTB vote, the European group has a substantial larger influence

on MEPs’ voting behaviour than national parties. In fact, we found that this effect is strongly

significant (p <0.001). This result confirms our previous finding, demonstrated by the ‘EG-NP’ index.

By comparison, when interpreting the coefficients for the national party, they barely seem to have an 18

We follow the method of Hix et al. and use linear regression analysis where the constant is dropped (2007, pp. 132- 145).

N=471 Vote

Voting position EP group

Voting Position national party

Vote

1,000

Voting position EP group 0,477** 1,000

Voting position

national party 0,104* 0,228** 1,000

Pearson Correlation:**, *** significant at respectively 0.05 and 0.01 level (two-tailed)

22

influence on MEPs’ voting behaviour. However, we cannot formulate clear conclusions for this result

as it does not pass the significance criterion .

The reported significant high influence of European groups challenges the main findings from

previous research. Where the majority of literature argues that national parties control their MEPs,

especially in a highly salient case (Corbett, 2003; Hix et al., 2007), this does not seem to apply to the

CCCTB vote. To the best of our knowledge, only Rasmussen (2008) argues that the European group is

the main effective voting instructor. The latter is confirmed in our analysis on the CCCTB vote.

5.2. Research Question 2: Determinants of voting behaviour The second part of this investigation examines which variables are important determinants for MEPs’

voting decisions on the CCCTB proposal. Table 7 demonstrates the descriptive statistics of the

variables in this second regression.

5.2.1. Descriptive statistics Table 7: Descriptive statistics: regression 2

N=598 Mean SD Min Max

Vote 0,74 0,44 0 1 Group Left Right 4,13 1,43 1 7

Pro/Anti-European 0,75 0,43 0 1 Rapporteurship 0,39 0,49 0 1 Eurobarometer 0,13 0,19 -0,25 0,47

EU 2004 0,22 0,42 0 1 EU 2007 0,05 0,22 0 1

Economic Impact CIT 0,06 0,09 -0,17 0,27 Mandate 0,45 0,52 0 1

Age 53,64 10,44 25 80 Education 0,42 0,49 0 1

Amendments 0,48 5,27 0 86 Gender

0,63 0,48 0 1

First of all, the mean of the variable ‘vote’ equals 0,74, indicating that more MEPs voted in favour of

the CCCTB proposal. Next, we examine the European group variables. The variable ‘group Left Right’

with a mean of 4,13 shows that the EP consists of more MEPs who belong to a right oriented party.

Concerning the ‘pro/anti-European dimension’, we find that 75% of the MEPs are part of a pro-

European group. The variable ‘rapporteurship’ equals the maximum value 1 for the EPP group, as

Marianne Thyssen, MEP for the EPP group, held the rapporteurship. Due to the size of this group

(n=231), the mean becomes 39%. Hence, it demonstrates that 39% of the MEPs in this analysis are

member of the EPP group.

Further, we discuss the three Member State variables. The ‘Eurobarometer’-variable indicates that

23

the EU citizens’ popularity is the smallest in the United Kingdom and the greatest in the Netherlands,

respectively with a value of -0,25 and 0,47. Furthermore, the ‘EU 2004’ and ‘EU 2007’ variables reveal

that 22% of the MEPs represent a Member State that entered the EU in 2004 and 5% of the MEPs

originate from countries who became a MS in 2007.

The ‘economic impact on CIT revenue’ for Member States is the greatest for Belgium, which reaches

the maximum of 0,27% and the least positive for Malta, which equals the minimum of -0,17%. Lastly,

we discuss the individual variables. The variable ‘mandate’ indicates that 45% of the MEPs in our

data sample were exerting their first mandate in the EP. ‘Age’ shows that the youngest MEP is 25

years old, whereas the maximum age for a MEP was 80. The variable ‘education’ illustrates that 42%

of the MEPs possess an economic or law degree. Concerning the variable ‘amendments’, we see that

each MEP formulated 0,46 amendments on average. The maximum of submitted amendments

equals 86. Finally, our data is comprised of more male than female MEPs.

Table 8 demonstrates the correlation coefficients of the variables in this second regression. We

conclude that no problematic correlations between the variables arise, as the coefficients are

considerably lower than 0.7.

24

Table 8: Correlation matrix regression 2

Vote Group L/R

Pro/Anti EU

Rappor teur

EUbaro meter

EU 2004 EU 2007 Impact CIT

Mandate Age Education Amend ments

Gender

Vote 1,000

Group L/R -,217**

1,000

Pro/Anti EU ,436**

0,067

1,000

Rapporteur 0,036

,482**

,455**

1,000

EUbarometer ,121**

-,103*

,174**

,126**

1,000

EU 2004 -,390**

,138**

-0,036

0,057

-,098*

1,000

EU 2007 -,085*

-0,01

,135**

0,001

,164**

-,125**

1,000

Impact CIT ,334**

-0,062 -0,073

-,097*

-0,062

-0,475

-0,014

1,000

Mandate -0,033

0,076

-0,047

0,034

0,022

-0,024

-,098*

-0,009

1,000

Age 0,072

0,001

0,067

0,01

-,103*

-0,03

-,099*

,106**

,085*

1,000

Education -0,009

,133**

,096*

0,062

0,004

-0,013

0,016

-0,079

-0,052

-0,042

1,000

Amendments -0,079

-0,051

-0,019

0,002

0,045

0,025

-0,015

-0,01

0,013

-0,001

-0,017

1,000

Gender

-,117**

,157**

-0,053

0,037

-0,036

0,064

-0,041

-0,017

-0,026

,146**

0,067

-0,008

1,000

Pearson Correlation: *, **, *** significant at respectively 0.10, 0.05 and 0.01 level (two-tailed)

25

5.2.2 Regression 2 We apply a binary logistic regression to examine the main variables that predict MEPs voting

behaviour. Table 9 presents the results of this statistical analysis.

Table 9: Determinants of voting behaviour regression 2

Predicted sign B (Coef.) S.E.

Group Left Right (-) -0,227** 0,097

Pro/Anti-European (+) 5,18*** 0,558

Rapporteurship (?) -1,753*** 0,465

Eurobarometer (+) 0,908 0,791

EU 2004 (-) -2,158*** 0,394

EU 2007 (-) -3,874*** 0,578

Economic Impact CIT (+) 1,286*** 0,229

Mandate (?) -0,629 0,724

Age (?) -0,004 0,013

Education (?) -0,328 0,286

Amendments (?) -0,068 0,063

Gender (?) -0,351 0,289

Constant 0,908 1,023

Chi² 329,04*** Number of obs. 598 Nagelkerke R²

0,623

*, **, *** significant at respectively 0.10, 0.05 and 0.01 level (two-tailed)

From this analysis, we can conclude which variables have a significant positive or negative impact on

MEPs’ voting decisions on the CCCTB proposal. As the logit B coefficients are difficult to interpret, we

only formulate clear statements about the direction of influence.

It can be concluded that all three included European group variables have a significant influence on

MEPs’ voting behaviour. As expected, the variable ‘group Left-Right’ has a negative impact on MEPs’

decision on the CCCTB proposal. Thus, the probability that a MEP votes in favour of the CCCTB

decreases when he or she belongs to a more right oriented group. This finding is consistent with the

expectations from the literature, which states that groups who classify themselves at the right end of

the political spectrum generally oppose to strict tax policy legislation (Benoit and McElroy, 2007;

Gabel and Hix, 2002).

Secondly, the positive outcome of the ‘pro/anti-European’ variable matches the expectation that

MEPs who belong to groups that are considered as ‘pro-European’ have a larger probability to vote in

favour of legislative proposals on tax issues (Benoit and McElroy, 2007; Hix, 2006). An interesting

finding is the reported influence of rapporteurship. From the literature, we could expect that the

rapporteurship could play an important role. Although, we did not formulate clear expectations - as

26

little is known about the influence of this mandate - it is demonstrated that the rapporteurship has a

significant negative influence on MEPs’ voting behaviour. Hence, it can be said that within the group

that possesses the rapporteurship, MEPs are less likely to vote in favour of the proposal. This is a

remarkable result and could possibly be explained because of the earlier mentioned information

benefits. As more information is available within the group that held the rapporteurship, MEPs could

become more critical and reluctant to vote in favour of the amended proposal. This result also

provides an explanation for the remarkable low cohesion rate of the EPP group, which was exposed

earlier. Furthermore, as ‘appendix 2’ indicates we see that the rapporteur for the CCCTB, Marianne

Thyssen, voted in accordance with her Member State line.19 Despite the fact we demonstrated that

the national party does not significantly influence MEPs’ voting behaviour, this in an indication of a

possible difference for the rapporteur. In line with the argumentation of Costello and Thomson

(2010), we see that the rapporteurship has a significant effect on its groups’ voting position and that

the voting behaviour of the rapporteur is in accordance with her Member State’s voting line.

However, as the EPP members are less likely to vote in favour of the CCCTB proposal, this result

indicates that the rapporteur does not succeed in biasing the voting behaviour in an effective way.

Furthermore, the variables ‘EU 2004’ and ‘EU 2007’ allow us to thoroughly examine the voting

behaviour of MEPs from new Member States. Previous research has already demonstrated that

MEPs from new Member States are more critical towards the CCCTB proposal (Roggeman et al.,

2015). However, by investigating MEPs’ voting behaviour from countries that entered in 2004 and

2007 separately, we can identify possible differences within the group of new Member States. The

negative significant influence shows us that both 2004 and 2007 MEPs are more reluctant to vote in

favour of CCCTB than former Union Member States.20 As EU 2007 countries are marked with a larger

negative B-coefficient, this could be an indication that this effect is even stronger for countries that

joined the EU in 2007. Hence, thsee results suggest that MEPs from Romania and Bulgaria have a

larger probability to oppose to the CCCTB in comparison to the 2004 and EU15 Member States. As

Lindstädt et al. (2012) indicated, MEPs from new Member States tend to vote more along country

lines first, but due to the socialization and learning effects, this distinction in voting behaviour

disappears quickly. However, in a salient case like the CCCTB, there still remain significant differences

between new Member States and old Member States behaviour. The critical conditions and

considerable implications of the CCCTB proposal seem to be an incentive for MEPs from new

Member States to act as an advocate for their country rather than for their European group. Even

19

Member States’ voting lines are demonstrated in appendix 2 20 Thereby, we mean the Member States who were a part of the EU before 2004 (EU15).

27

within the new Member States group, it is shown that MEPs from the EU 2007 have a larger

plausibility to oppose to the proposal than MEPs from the 2004 countries.

The economic impact on CIT revenue for Member States is the last variable that has a significant

positive influence on MEPs’ voting behaviour. It is demonstrated that a higher positive impact on

CCCTB contributes to an increased probability to vote in favour of the proposal. This finding is in line

with the work of Roggeman et al. (2015) and remains robust in this analysis.

Despite our expectations of a positive impact, the ‘Eurobarometer’ variable does not pass the

significance criteria. As Roggeman et al. (2015) reported the unsure influence of this variable, our

analysis confirms that the Eurobarometer has little predictable value for MEPs’ voting outcomes.

Finally, In line with the argumentation of Laible (2008), the individual variables do not seem to have a

significant influence on MEPs’ voting behaviour. Even though the analysis of Roggeman et al. (2015)

showed a significant negative influence on the variable ‘amendments’, this finding does not remain

robust after exploring new variables into our regression model.

28

6. Conclusion

When the EP voted, by simple majority, in favour of the amended CCCTB proposal, it formulated a

clear signal towards the desirability of a unified European Single Market. With the implementation of

a CCCTB, the EU tries to overcome tax obstacles and contribute to the harmonization of tax rules

within its territory. However, Bettendorf et al. (2009) demonstrated that the CCCTB would have a

divergent impact on the different Member States. In addition, the EP only has a constrained,

consultative role on the CCCTB vote. These factors could possibly affect MEPs voting behaviour on

this proposal. Given the specific nature of the CCCTB vote, this investigation addresses two research

questions.

First, we examined the main principal of MEPs on the CCCTB vote. Due to the specific impact for each

Member State, national parties could try to shape MEPs’ voting outcome. However, as the CCCTB

alleviates tax obstacle problems within the EU, European groups have incentives to instruct their

MEPs too. Moreover, national parties could evaluate MEPs’ voting outcomes as less relevant due to

the constrained role of the EP on the CCCTB vote. The latter could imply less voting instruction

efforts from the national party in this consultative vote. Nevertheless, this analysis provides evidence

that both European groups and national parties are effective voting instructors on the CCCTB vote.

Despite the salient nature of the proposal, little conflict between the two principals occurs.

However, by applying statistical regression analysis, this investigation demonstrates that European

groups are the main principals of MEPs on the CCCTB vote. Both national parties and European

groups possess important instruments to discipline their MEPs. Although the monitoring of candidate

selection and availability of elective positions on voting lists is exclusively the domain of the national

parties, MEPs tend to follow their European group when deciding on the CCCTB proposal. This

remarkable result questions the general assumption that MEPs are primarily loyal to their national

parties’ position (Faas, 2003; Hix, 2002; Hix et al., 2007; Whitaker, 2005). The presence of the ‘whips’,

the key influence of groups for internal parliaments’ positions and the acquired prestige could be

important reasons why European groups are more effective in instructing MEPs than national

parties. Hence, we endorse the evidence of Rasmussen (2008), as we demonstrate that European

groups are the most effective in shaping MEPs voting outcome, even on a highly salient vote.

However, it needs to be stressed that this result could also be explained by the limited role of the EP

in the special legislative procedure. It is assumable that national parties consider the MEPs voting as

less relevant because of the importance of the Council of Ministers in this procedure.

Second, we probed the determinants of MEPs’ voting behaviour. In line with previous research, our

analysis demonstrates that European group variables have a significant influence on MEPs’ voting

29

behaviour. Similar to the CCCTB analysis of Roggeman et al. (2015), we show that MEPs from right

oriented groups and anti-European political groups are significantly less likely to vote in favour of the

CCCTB proposal than MEPs belonging to left oriented groups and pro-European political groups.

Furthermore, this investigation illustrates the significant impact of the rapporteurship on MEPs’

voting behaviour. Little research has investigated the influence of rapporteurship on voting

outcomes (Costello and Thomson, 2010). Our results identify that, MEPs who belong to the European

group that holds the rapporteurship, are less likely to vote in favour of the CCCTB proposal.

Apparently, the rapporteur, who possesses a lot of information on the topic contributes to a more

critical attitude of his/her group towards the amended proposal.

Next, we also show that new Member States (EU2004 and EU2007) are more critical towards the

CCCTB proposal than old Member States. Previous research clarified that, despite the fact that in

general, the enlargement operations of 2004 and 2007 did not harm the power balance in the EP,

slight differences can occur on highly salient cases where national interests are at stake (Hix and

Noury, 2009; Voeten, 2009). Our analysis confirms the finding that MEPs from new Member States

are less likely to vote in favour of proposals on EU taxes (Heinemann, 2009). In particular, this

research indicates that MEPs from the most recently joined Member States, Bulgaria and Romania,

are more critical towards the proposal than their colleagues belonging to the countries that became

a Member State in 2004.

The significant positive impact of CIT revenue, as calculated in the impact assessment of Bettendorf

et al. (2009), remains robust in our analysis. This way, our analysis endorses the finding of Roggeman

et al. (2015) who have demonstrated that MEPs belonging to countries with a positive impact on

their CIT revenue were more likely to vote in favour of the CCCTB proposal. Finally, we do not find

evidence that the citizens’ support for the EU, measured by the ‘Eurobarometer’ variable, and the

individual characteristics of MEPs significantly influence MEPs’ voting behaviour.

We contribute to the literature by exposing the significant impact of European groups for MEPs’

voting decision. Although, it needs to be stressed that this finding is demonstrated on a case where

the EP only had a consultative role, it could prompt the debate in the study of voting behaviour in the

EP. Future research should investigate if European groups are the most effective principals in other

votes where the consultative role is applicable.21 On the other hand, an update of the analysis of Hix

et al. (2007, pp. 132-145) for the most recent legislature of 2009- 2014 could reveal if this finding is

also applicable on votes where the EP has co-decision power. Despite the fact that, Hix et al. (2007)

exposed stable and clear patterns where the national party remained the ultimate principal for MEPs

21

I.e. the case when Article 195 of the Treaty of the Functioning of the European Union is applicable (European Union, 2012, p. 49)

30

over five legislatures, it has to be investigated if drivers of voting behaviour in the EP are evolving.

When voting behaviour is primarily motivated by European lines, this could have important

consequences for the European ‘demos’ and the debate on the European democratic deficit (Hix,

1998; Follesdal and Hix, 2006; Orbie, 2009).

Second, this analysis empirically confirms the importance of the rapporteurship. However, we only

demonstrate that the rapporteurships’ group significantly exposes different voting behaviour than

other groups. In addition, we again need to mention that the legislative context facilitates the

rapporteurships’ abilities to bias the agenda and have an effect on the voting outcomes (Costello and

Thomson, 2010). Therefore, future research should investigate if this finding is robust in other votes

where the consultative role applies in order to formulate unequivocal conclusions about the

rapporteurships’ influence. Furthermore, future research should provide us clear explanations why

and in which way the variable influence MEPs’ voting.

VII

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XI

0

50

100

150

200

250

European Groups: Loyal/Disloyal Voting Position

Rebel

Loyal

Appendix 1

Figure 3: Loyal/Rebel European group

05

101520253035

National Parties Loyal/Rebel voting position

Loyal Rebel

Figure 2: Loyal/Disloyal National Party

XII

Appendix 2 Similar to the computation of the national party line in the EG-NP index, we calculated the Member

State line. Consequently, when more than 50% of the MEPs from a Member State vote for the CCCTB

proposal, the Member State line becomes ‘yes’. On the contrary, when more than 50% of the MEPs

voted no, the Member State line becomes ‘no’.

Table 10: Member State line

N=598 Against For Member State Line

Austria 0 13 Yes

Belgium 1 18 Yes

Bulgaria 12 3 No

Cyprus 2 3 Yes

Czech Republic 12 7 No

Denmark 2 6 Yes

Estonia 1 4 Yes

Finland 0 10 Yes

France 5 54 Yes

Germany 8 81 Yes

Greece 0 14 Yes

Hungary 11 6 No

Ireland 7 1 No

Italy 1 66 Yes

Latvia 2 5 Yes

Lithuania 1 10 Yes

Malta 3 1 No

Netherlands 5 13 Yes

Poland 42 5 No

Portugal 3 17 Yes

Romania 1 15 Yes

Slovakia 3 8 Yes

Slovenia 0 7 Yes

Spain 1 45 Yes

Sweden 1 8 Yes

United Kingdom 31 23 No

N= 155 443