Theorising Bounded Rationality in EU Policy‐Making

Abstract This article proposes a theoretical framework combining multi‐level governance (MLG) with bounded rationality. MLG theories have become increasingly popular to understand European Union (EU) policy‐making and interactions between national, sub‐national and EU levels. At the same time, principles of bounded rationality are entering the public policy debate, highlighting the role of cognitive biases in policy formation. However, these two developments have been separate, as bounded rationality has been little used in EU studies. The article therefore proposes a framework integrating the two lenses. This sheds new light on the optimal allocation of tasks between EU and national levels, given the prevalence of different cognitive biases at each level. Findings are that EU‐level policy‐making can be hampered by availability heuristics and undefined preferences, whilst national policy‐making is prone to zero‐sum bias and myopia. Insights are applied to research policy as an example, helping to explain obstacles to EU integration in this area.