Members of parliament and governments in western Europe: Agency relations and problems of oversight

Abstract. The vast majority of West European polities feature an agency relationship between members of parliaments and members of cabinets as the latter depend on the confidence of the majority of the former to remain in office. In this article, the terminology used by principalagent theory to characterise oversight activities – contract design, screening, monitoring and the use of institutional checks – and elements of transaction cost economics are applied to the agency relationship between members of parliaments and cabinet members in Western Europe. Traditional studies of parliamentary oversight have narrowly concentrated on monitoring, although parliaments (with considerable cross–national variations) use a broad range of oversight mechanisms including equivalents of contract design, screening and institutional checks. In addition, traditional studies have focused almost exclusively on one particular type of monitoring often referred to as ‘police–patrol oversight’, whilst neglecting or underestimating the effectiveness and low transaction costs associated with ‘fire–alarm oversight’. Despite the valuable insights the principal–agent framework has already added to the study of executive–legislative relations in parliamentary democracies, future research will have to account more realistically for the role and organisation of political parties which structure the delegation process, help to solve a number of co–ordination problems in parliaments (for example, the co–ordination of committees and floor activities) and generate important internal agency relationships that are fundamental to an understanding of executive–legislative relations in Western Europe.