Explaining Petroleum Policy in Britain and Norway, 1962‐90

Petroleum policy in Britain and Norway provides comparativists with an opportunity to study policy formation, stability, and transformation on a cross‐national basis. This study explains why British and Norwegian officials decided to intervene in the North Sea, why offshore policy in the two countries went through periods of stability and change, and why they adopted similar offshore systems in the 1960s and 1970s but diverged markedly in the 1980s. We develop an explanatory framework using insights from state‐centric, group politics, rational choice, and institutional models of policy‐making. The framework identifies three decision‐making contexts in which petroleum policy‐makers operate simultaneously: an oil context, a domestic political context, and an international context, Each context establishes objectives for policy‐makers, indicates an acceptable degree of government intervention, and narrows policy options. Rational decision‐making within each context, however, may yield conflicting results. These must be worked out through intrastate and/or state‐society bargaining. The decision‐making contexts in Britain and Norway produced similar policies in the 1960s and 1970s, but the similarities hid deeper differences. Norwegian officials consistently favored state intervention offshore, and Norwegian interest groups successfully lobbied the state for offshore favors, while British officials intervened more reluctantly and paid less attention to societal interests. Differences in decision‐making contexts finally produced a major divergence in offshore policies in the 1980s when the Thatcher government dismantled the state's offshore participation policy.