Policy choices are affected by both the polity (i.e. the institutional arrangements characterizing a political system) and the politics (i.e. the policy-making process). This chapter provides an overview of the most central institutions and actors participating in the policy-making process and paves the way for the analytical approaches presented later. Our understanding of institutions corresponds to formal and information rules that shape the choices individuals make in different institutional settings. We define ‘actors’ as (groups of) individuals who participate in policy processes and whose preferences will ultimately determine the policy choice. The most central institution of any political system is represented by the constitution and – where this exists – the constitutional court protecting the fundamental principles of government it defines (Shane 2008). This is followed by the horizontal division of power between the executive, the legislature and the judiciary, as well as the vertical division of power determining whether a state is unitary or federal. This group of fundamental institutions is complemented by the electoral and party system. In addition to national institutions, supranational and intergovernmental institutions are increasingly influential in domestic policy-making. Taking this into account, we outline the main characteristics of two such intergovernmental organizations: the United Nations (UN) and the World Trade Organization (WTO). We then shift the focus from institutions to the key policy-making actors, including the executive, the legislature, the judiciary, bureaucracies, political parties, interest groups and experts.
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