Theoretical framework

The political role of experts and expert knowledge is a subject of discussion in various academic fields, including political science, sociology, and public administration studies (e.g., Haas Reference Haas1992; Peters Reference Peters2010; Skocpol Reference Skocpol1985; Wilson Reference Wilson2019). The growing reliance of decision-makers on advanced knowledge and experts to address complex and often global societal challenges has led to a surge in academic interest in the topic (Bertsou and Caramani Reference Bertsou and Caramani2020; Christensen Reference Christensen2021). This emphasis is particularly evident in the realm of economic ideas and the individuals advocating for them, reflecting the influential institutional position of many economists and the increasing breadth of government concerns where economic reasoning is applied (Blyth Reference Blyth2002; Campbell Reference Campbell1998; Hirschman and Berman Reference Hirschman and Berman2014; Markoff and Montecinos Reference Markoff and Montecinos1993; Nelson Reference Nelson1987; Rhoads Reference Rhoads1978).

The literatures studying expert ideas and their advocates propose different concepts and theoretical arguments to capture and explain their political effects. While some scholars focus on the knowledge or expert idea itself (Béland Reference Béland2009; Béland and Cox Reference Béland and Cox2016; Campbell Reference Campbell2002; Hall Reference Hall1993), others focus on the expert or the group of experts (Bertsou and Caramani Reference Bertsou and Caramani2020; Fourcade et al. Reference Fourcade, Ollion and Algan2015; Hirschman and Berman Reference Hirschman and Berman2014; Markoff and Montecinos Reference Markoff and Montecinos1993). In an effort to facilitate dialog between the different literatures, Christensen (Reference Christensen2021) advocates conceptualizing the key issue as a question of expert influence. Following Dür (Reference Dür2008, p. 561), influence is defined as “an actor’s ability to shape a decision in line with her preferences.” This definition encompasses three basic elements: (1) the actor, (2) the preference of the actor regarding a specific policy, and (3) the policy decision which the actor seeks to influence. In this section, we expand upon this perspective and introduce an extension to the theoretical framework, incorporating strategic framing as a means to influence policy decisions.

Applied to expertise and policymaking, the influence-oriented perspective means fixing our gaze on the ability of expert actors to shape policy decisions in line with their knowledge-based preferences (Christensen Reference Christensen2021, p. 9). The expert actors in this context are the individuals influencing the policymaking process. While most studies of expert influence focus on state bureaucracies and knowledge regimes (e.g., Campbell and Pedersen Reference Campbell and Pedersen2015; Christensen Reference Christensen2017; Haas Reference Haas1992; Quaglia Reference Quaglia2005), elected or appointed politicians with formal economic training can be, or can become, experts (Grødem and Hippe Reference Grødem and Hippe2019; Markoff and Montecinos Reference Markoff and Montecinos1993). Recent research illustrates how many European countries are dominated by technocratic governments and politicians with high-ranking academic qualifications (Bovens and Wille Reference Bovens and Wille2017; Pastorella Reference Pastorella2016). Building on this perspective, we define expert actors as a technocratic elite of economists working within the state, holding administrative or political leadership positions.

The second element is the preference of the actor regarding a specific policy or an issue more generally. A key reference point in the field is the concept of the policy paradigm as an organizing principle providing a unifying set of ideas and standards, core beliefs, concepts, language, and policy tools (Hall Reference Hall1993). The policy paradigm serves as the (coherent) set of ideas underpinning the policy regime, constituting the systematic and predicable part of all decisions (Temin Reference Temin1989). Hence, while the original framework defines the third element as a singular decision (Christensen Reference Christensen2021; Dür Reference Dür2008), we suggest an extension of the temporal scope to include the dynamics of policymaking. This extension is intended to capture the critical contribution of experts in maintaining regime legitimacy when confronted with inescapable challenges.

The suggested framework reflects how the prevailing literature on experts and their influence has predominantly emphasized intellectual rather than the normative aspects of expert arguments. Yet a significant source of expert influence stems from the capacity to provide not only arguments about what is but also what ought to be (Campbell Reference Campbell1998; van Hulst and Yanow Reference van Hulst and Yanow2016; Rein and Schön Reference Rein, Schön, Fischer and Forester1993; Schmidt Reference Schmidt2008). Although economists are commonly perceived as value-neutral professionals, their approach to problem-solving methods, such as weighing costs and benefits, analyzing quantitative data, and considering incentives inevitably have normative policy implications (Berman Reference Berman2022; Campbell Reference Campbell1998; Fourcade et al. Reference Fourcade, Ollion and Algan2015; Hirschman and Berman Reference Hirschman and Berman2014; Markoff and Montecinos Reference Markoff and Montecinos1993). Furthermore, studies indicate that the influence of economists is particularly pronounced when policy issues are framed as fundamentally technical and depoliticized (Brint Reference Brint1990; Helgadóttir and Ban Reference Helgadóttir and Ban2021; Hirschman and Berman Reference Hirschman and Berman2014). The phenomenon of depoliticization typically refers to governing strategies that remove or displace the potential for choice, collective agency, and deliberation concerning a particular political issue (Burnham Reference Burnham2001; Fawcett et al. Reference Fawcett, Flinders, Hay and Wood2017; Hay Reference Hay2007). However, the political aspects persist, and depoliticization essentially involves shifting the decision-making arena from the public sphere to a professional domain (Flinders and Buller Reference Flinders and Buller2006; Hay Reference Hay2007). In recent years, a growing trend of depoliticization has empowered economists not only to formulate solutions to a problem (cognitive ideas) but also to ascribe values and legitimize policies by referring to their appropriateness (normative ideas) (Flinders and Buller Reference Flinders and Buller2006; Schmidt Reference Schmidt2008). While the expanding literature on depoliticization typically emphasizes institutional changes and the delegation of authority from elected politicians, depoliticization strategies also encompass a discursive element, where the debates on specific issues adopt a more technocratic character (Kuzemko Reference Kuzemko, Flinders and Wood2015; Mandelkern and Oren Reference Mandelkern and Oren2023; Wood and Flinders Reference Wood and Flinders2014). This allows for the inclusion of normative choices that are likely to remain hidden from non-experts due to their apparent technical nature (Berman Reference Berman2022; Fourcade Reference Fourcade2006; Hirschman and Berman Reference Hirschman and Berman2014). Hence, in this article, we will argue for moving decisively into normative territory and recognizing the significance of narratives in the study of expert influence.

Studies of storytelling as a political strategy include a wide variety of theoretical and conceptual approaches, including narrative research (Fischer Reference Fischer2003; Jones and McBeth Reference Jones and McBeth2010; Shanahan et al. Reference Shanahan, Jones, McBeth, Radaelli, Weible and Sabatier2018), rhetorical studies (McCloskey Reference McCloskey1998; Shiller Reference Shiller2019), and the role of ideas and framing (Béland Reference Béland2009; Campbell Reference Campbell2002; Campbell Reference Campbell1998; Goffman Reference Goffman1974; Schmidt Reference Schmidt2002, Reference Schmidt2008; Steensland Reference Steensland2006). Specifically, Campbell (Reference Campbell1998) suggests including the normative dimension by introducing frames in explaining how ideas affect policymaking. Conceptualizing frames as symbols and concepts that help political elites legitimize policy solutions to the public, Campbell illustrates how framing constrains both the cognitive level and the normative range of solutions that policymakers are likely to consider (Campbell Reference Campbell2002; Campbell Reference Campbell1998). In this article, we will apply a theoretical framework of framing to analyze the role of economists as storytellers.

The theory of framing has origins in social anthropology, psychology, and sociology, and is widely applied in social sciences in order to explain how political actors sway policy decisions in their favored direction (Entman Reference Entman1993; Goffman Reference Goffman1974; van Hulst and Yanow Reference van Hulst and Yanow2016; Matthes Reference Matthes2012; Rein and Schön Reference Rein, Schön, Fischer and Forester1993; Schmidt Reference Schmidt2002). The concept of framing rests on the idea that humans need to make choices on how to structure their social world. Thus, when we engage in communicating, we must select certain elements of our perceived reality at the expense of others. Within the realm of politics, actors strategically highlight specific aspects of an issue and construct their arguments upon these choices, a practice commonly known as strategic framing in the academic literature (Dan et al. Reference Dan, Ihlen, Raknes, Strömbäck and Kiousis2019; Hallahan Reference Hallahan, Strömbäck and Kiousis2019; Strömbäck and Esser Reference Strömbäck and Esser2017). Building upon Entman’s (Reference Entman1993) influential framing theory, this strategy involves selecting specific elements of perceived reality and magnifying their significance. This is achieved by defining problems deserving public and government attention, identifying their causes and the factors contributing to the problem, making moral judgments, and providing and justifying solutions for the problems while predicting their likely effects (Entman Reference Entman1993, 52).

Strategic framing has a communicative function in conveying and legitimizing political ideas to the general public but may also have a coordinating function within the policy sphere by providing a shared language for key policy groups to achieve consensus when developing a policy program (Berman Reference Berman2022; Nelson Reference Nelson1987; Reay Reference Reay2012; Schmidt Reference Schmidt2002, Reference Schmidt2008). To render their economic recommendations politically relevant, economists must “tailor their advocacy of market methods, efficient resource use, and other economic approaches to the political environment” (Nelson Reference Nelson1987, 50). Hence, state economists are not only proficient in economic reasoning but also skilled political actors and communicators, who actively promote a way of thinking that emanates from their fundamental economic training, reinforcing the policy conclusions derived from this perspective (Berman Reference Berman2022; Nelson Reference Nelson1987; Reay Reference Reay2012).

Various factors impact the effectiveness of strategic framing. Existing research emphasizes elements such as clarity and suitability of the arguments, as well as whether they are perceived as truthful, logically sound, and consistent across policy domains (Blyth Reference Blyth2002; Campbell Reference Campbell1998; Hirschman and Berman Reference Hirschman and Berman2014; Schmidt Reference Schmidt2008). Furthermore, when framing is intricately intertwined with cultural elements, it operates in a subtle and implicit manner, enhancing the argument by bridging cognition and culture (Dan and Ihlen Reference Dan and Ihlen2011; Van Gorp Reference Van Gorp2007). By effectively communicating central cultural values through storytelling, policy framing is more likely to succeed in implicitly or explicitly prescribing the appropriate course of action (Brint Reference Brint1990; van Hulst and Yanow Reference van Hulst and Yanow2016; Rein and Schön Reference Rein, Schön, Fischer and Forester1993).

In our analysis, we will rely on the concept of policy framing as a dynamic and continuous process in which frames are constructed (van Hulst and Yanow Reference van Hulst and Yanow2016; Schmidt Reference Schmidt2002, Reference Schmidt2008). Given that contextual and political factors evolve over time, this process-oriented approach to framing is especially relevant in studies of policymaking. Consequently, continuous attention must be given to the existing policy story so that any shifts can be justified, or to avoid potential frame conflicts that challenge the established policy regime. Hence, reframing becomes an integral part of policy change, allowing for the adaptation and integration of any changes to make them align with the existing paradigm (Campbell Reference Campbell2002; van Hulst and Yanow Reference van Hulst and Yanow2016; Schmidt Reference Schmidt2002, Reference Schmidt2008). Furthermore, framing strategies undergo evolutionary dynamics as actors actively take part in framing competition or seek framing coalitions. Framing competition occurs when a given frame encounters rival frames offering alternative perspectives on problem definitions, causal interpretations, moral judgments, and policy recommendations (Chong and Druckman Reference Chong and Druckman2007; Dan et al. Reference Dan, Ihlen, Raknes, Strömbäck and Kiousis2019; Reese Reference Reese2003; Sniderman and Theriault Reference Sniderman, Theriault, Willem E. and Sniderman2004). Conversely, framing coalitions arise when political actors opt for explicit or implicit collaboration, thereby reinforcing the influence and legitimacy of their own demands (Croteau and Hicks Reference Croteau and Hicks2003; Mayer et al. Reference Mayer, Brown and Morello-Frosch2010). These conceptual frameworks become particularly relevant when employed in examinations of political processes and interactions among various political actors.

Thus, to enhance our understanding of expert influence, we propose incorporating a fourth element in the theoretical concept of expert influence. In addition to the elements of the actor, their preferences, and the policy decision they seek to influence, we suggest explicitly including strategic framing of the preferred policy as a fourth element in the theoretical framework. In the following sections, we demonstrate the relevance of this approach by studying the influence of expert knowledge in the establishment and consolidation of the Norwegian Oil Fund and its associated fiscal regime.

Research design and methods

The empirical research relies on an in-depth case study examining the institutionalization of the Norwegian Oil Fund and the associated fiscal regime (George and Bennett Reference George and Bennett2005; Meyer Reference Meyer2001; Yin Reference Yin2018). The Norwegian state’s ability to combine financial savings abroad with rule-based fiscal spending compares favorably to most other cases where governance structures have been exposed to large resource-driven income streams (Holden Reference Holden2013; Sachs and Warner Reference Sachs and Warner1995). This study explores the key actors that constructed Norway’s macroeconomic regime for managing petroleum wealth over a time span of 30 years, focusing on the events that occurred between 1990 and 2004.

A central factor in this historical context is the privileged role held by economists within the Ministry of Finance in Norwegian politics, a phenomenon extensively documented in various studies (e.g., Christensen Reference Christensen2017; Lie and Venneslan Reference Lie and Venneslan2010; Slagstad Reference Slagstad1998; Tranøy Reference Tranøy2000). Since 1945, macroeconomists predominantly educated at the University of Oslo and employed by the Ministry of Finance and Statistics Norway have had a profound impact on Norwegian macroeconomic policy. During the 1980s, there was a shift from the predominantly Keynesian economic paradigm that had guided Norwegian economic policy for decades. Negative experiences with state interventionism and escalating issues on the supply side of the economy fostered a more market-oriented approach (Christensen Reference Christensen2017; Lie and Venneslan Reference Lie and Venneslan2010). This shift led to the dominance of a more neoliberal economic paradigm within the Ministry, characterized by a favorable view of market mechanisms and skepticism towards activist macroeconomic policy (Blyth Reference Blyth2002; Lawson Reference Lawson2003).

There are various ways of doing case studies of political processes (Beach and Pedersen Reference Beach and Pedersen2019; Collier Reference Collier2011; Eisenhardt and Graebner Reference Eisenhardt and Graebner2007; George and Bennett Reference George and Bennett2005; Gioia et al. Reference Gioia, Corley and Hamilton2013; Langley Reference Langley1999; Mahoney et al. Reference Mahoney, Kimball and Koivu2009). In this study, we applied a temporal bracket strategy (Langley Reference Langley1999) to structure a chronology of relevant events, before coding the empirical material and analyzing the findings in light of the theoretical framework presented above (Entman Reference Entman1993; Gioia et al. Reference Gioia, Corley and Hamilton2013). The initial strategy involved structuring key events in the political process from 1990 to 2004 into sequences, contributing to the identification of two main phases (Figure 1). First, the establishment of the Oil Fund and the investment strategy, and second, the definition of a fiscal rule to regulate petroleum revenue expenditure and the implementation of ethical guidelines. Beyond the descriptive utility of creating a chronology of the case, emphasizing timing and sequences contributes to shedding light on when and in what order events took place, a central aspect in studies of political processes (Pierson Reference Pierson2000). Furthermore, temporal decomposition and sequence analysis offer an opportunity to investigate factors that explain similarities or differences in particular classes of events (Langley Reference Langley1999; Mahoney et al. Reference Mahoney, Kimball and Koivu2009). This approach enables us to scrutinize and compare how economic ideas and economists influenced the evolution of the policy regime at various stages.

Figure 1. Case study timeline and key political actors (1990–2013).

We use several data sources in the study: (a) interviews with political actors, (b) government reports, (c) reports and transcripts from the Norwegian Parliament, and (d) reports from the Oil Fund, NGOs, media, and others (Table 1). A particularly valuable source is the 26 elite interviews with former prime ministers, ministers of finance, top bureaucrats, and other key stakeholders (Table 2). We conducted two rounds of interviews with key political actors who were active between 1990 and 2010, and used purposeful sampling to pinpoint key actors, such as the ministers of finance, the director generals of the Ministry of Finance, and the CEOs of the Oil Fund (Lincoln and Guba Reference Lincoln and Guba1985). We also interviewed employees in the Fund and Ministry of Finance staff, journalists, and NGO representatives. Data collection began in 2017 and ended in 2021.Footnote ¹

Table 1. Data sources

Table 2. List of interviewees

Semi-structured interviews involve both open-ended questions on the case itself and its historical context, and more targeted questions regarding economic ideas and preferences, motivation, policy development, and political controversies. The interview transcripts and public reports were analyzed using a qualitative data analysis tool. The coding strategy started with open coding and classification, following which the categories were further refined to facilitate theorization (Gioia Reference Gioia2021; Gioia et al. Reference Gioia, Corley and Hamilton2013). The first-order codes included a variety of categories, such as procedures, rules, lessons learned, positive and negative relations, timing, and political leadership. The second-order coding focused on the application of the key theoretical concepts of policy paradigm, policy regime, and framing. Specifically, in the framing analysis we conducted data coding with the guiding principle of identifying representations of the elements delineated in Entman’s (Reference Entman1993) definition of framing, which encompasses problem definition, causes, moral evaluation, and treatment recommendations on a particular issue (policy regime).

To enhance data validity, we triangulated the interviews with evidence from policy transcripts, official documents, and media reports. The secondary data sources included 98 public reports from the Norwegian Government and Ministry of Finance, Norges Bank, the Norwegian Parliament, and relevant NGOs. The data material from media articles was obtained by running a search query in the news archive Atekst (Retriever) for newspaper articles related to the Oil Fund between 1980 and 2004. This resulted in 1128 relevant articles. After conducting additional filtering, we identified 126 articles that effectively captured the essential features of the discussion about the Oil Fund and how various influential actors conveyed their perspectives through the media. Furthermore, our understanding of the broader political and economic context was enriched by well-established historical research on Norway’s politics and economy (Hanisch and Nerheim Reference Hall1992; Lie et al. Reference Lie, Kobberrød, Thomassen and Rongved2016; Lie and Venneslan Reference Lie and Venneslan2010).

Findings and discussion

The first requests from international oil companies in the early 1960s to explore the North Sea seabed took Norwegian authorities by surprise. However, Norway had extensive historical experiences in natural resources management, having enacted the Waterfall Rights Act establishing state ownership of energy resources half a century earlier.Footnote ² This decision was guided by the ideology that revenue from natural resources should benefit the broader population. In 1963, Norwegian authorities proclaimed sovereignty over the Norwegian Continental Shelf, declaring any natural resources to be discovered as state-owned. In the decades that followed, the Norwegian economy encountered significant instability resulting from volatile income streams and excessive private and public spending, demonstrating the adverse economic effects of petroleum-based revenues. In the following section, we explore the development of a new regime for the management of the petroleum-related revenues, described here as an institutionally established form of self-restraint.

Developing a policy regime for the management of petroleum wealth (1990–1998)

The idea of a fund first appeared in a Norwegian Official ReportFootnote ³ in 1983 as part of a broader discussion addressing the challenges posed by the volatility of oil prices. The commission that authored the report discussed a strategy of purposefully moderate pace of oil extraction combined with a buffer fund; however, it expressed concerns that a policy of self-restraint would be difficult to uphold in practice. This concern was shared by economists in the Ministry of Finance, who strongly recommended against establishing a fund (#9, #10). There was no consensus about the purpose of a fund, and the exponents of an ambitious industrial policy voiced the idea of establishing a fund in aid of major infrastructure projects and the internationalization of Norwegian industry. Worried that the public visibility of a large positive bank balance might encourage excessive spending, bureaucrats within the Ministry publicly commented that:

“(…) a fund would need to encourage mental hygiene efforts, reminding politicians that when spending money from the fund, they are in fact tampering with the family silver.”Footnote ⁴

The idea of establishing a fund was put off, but in 1989, when economist Arne Skauge (Conservative Party) took office as Minister of Finance, he publicly declared that “[t]here will be a petroleum fund even if what it takes is me writing the mandate myself” (#3). According to Skauge, the civil service had always had a fear of politicians’ inventiveness when it comes to new ways of spending money:

The bureaucrats in the Ministry of Finance were against creating a fund. They were very afraid that there would be a parallel budget next to the national budget […]. But I was convinced that the main principles of a petroleum fund needed to be established before the money began to pour in. Once the money was there, politicians and interest groups from across the spectrum would be scrambling to obtain money for their pet projects. (#3)

The economists in the ministry proposed laying down rigorous regulations to ensure that the fund would operate as a savings fund (#9, #10). First, all government net revenue from the petroleum sector was earmarked for direct allocation to the Oil Fund, which was to be kept entirely separate from the national budget. Second, all government spending was to be covered by the ordinary national budget. Third, the capital generated from the Oil Fund was restricted to foreign investments. Tore Eriksen, one of the Ministry’s top bureaucrats, was reassured:

We needed to draw up crystal-clear principles for saving properly, without any special rules that might permit the allocation of money for specific purposes. We were worried about the establishment of a fund, but when we developed it and got it ringfenced with clear principles, it was fine. (#10)

Minister of Finance Skauge made no changes in the blueprint from the Ministry, and in June 1990 the Norwegian Parliament unanimously approved the Government Petroleum Fund Act. The new legislation was introduced as long-term guidelines for the management of petroleum wealth, underscoring that any utilization of the Oil Fund capital would require extraordinary budgetary decisions consistent with a long-term perspective.Footnote ⁵ Alternative interpretations of the concept of “long-term,” such as investing in infrastructure or industry, were essentially disregarded. In the parliamentary debate, the Oil Fund was compared with Odysseus’ strategy for protecting his men from the song of the sirens by putting wax in their ears.Footnote ⁶ The politicians got the message: they required protection from the temptation of vested interests and opportunistic political desires.

The first deposit into the Oil Fund was made in 1996. The money was managed in accordance with foreign exchange regulations, with investments primarily directed towards low-risk bonds. Investing in bonds was a minimal-risk strategy, but the expected returns were low. The share of equity is considered to be a trade-off between risk and expected return, a notion well known to the recently appointed minister of finance and economist Jens Stoltenberg. Upon a substantial upward adjustment in the projections of future revenues, the bureaucrats recommended changing the strategy to include investment in equities:

Given the extended time-horizon, we recommended it was worth the risk (…). It was not a big ideological question or anything like that. Since we switched to looking more at the Oil Fund as a savings fund, the long-term return became more important. (#10)

While the original idea of a fund was based on the notion of creating a buffer fund to avoid the negative effects of volatile oil prices, the new investment policy was introduced as a strategy to enhance returns and curtail risk, as a consequence of the Oil Fund’s extended time horizon.Footnote ⁷ Finance Minister Stoltenberg argued vigorously for the changes:

I was convinced of the profitability of investing part of the revenue in the stock market, but I knew it was a very radical and bold suggestion. […] I felt we needed to hurry; we were losing money every day by not investing in the stock markets. (#1)

The political opposition in Parliament was not convinced. Parties from both the center and the left emphasized the ethical dilemmas involved in investing in the international equity market and proposed applying ethical guidelines to prevent investment in companies that violated basic human rights. However, the parliamentary majority rejected these suggestions, echoing arguments put forth by Norges Bank and the Ministry of Finance. Their stance emphasized that the Oil Fund should refrain from becoming “politicised” and act solely as a financial investor (#2, #6, #7): “The premise of business criteria for the Oil Fund’s investment policy will prevent the state as an investor from being held responsible for the conduct of individual companies.”Footnote ⁸

In the autumn of 1997, Norges Bank was awarded a mandate to invest 30–50 percent of the Oil Fund in equity. According to Svein Gjedrem, then Director General of the Economic Policy Department in the Ministry of Finance, it was a deliberate strategy to keep the Oil Fund out of reach of political actors:

It was essential that the Ministry of Finance was in control. The operational mandate was given to Norges Bank, which would not be as vulnerable to interest groups as other institutions. (#9)

With the Oil Fund firmly controlled by the Ministry of Finance, the money invested abroad, and the management of the portfolio outsourced to the Norges Bank, the economic technocrats had confidence in the firewalls they had built to protect the Oil Fund. Furthermore, they had successfully integrated the new regime into an overall historical and cultural discourse of long-term natural resources management and fiscal discipline.

In terms of Entman’s (Reference Entman1993) framework, the problem was defined as the adverse effect of resource abundance resulting from politically-driven overspending (Table 3). Consequently, the moral dimension of the issue was portrayed as safeguarding the revenue from short-sighted political desires. Rhetorical terms such as “arms’ length,” “firewall,” and “safeguarding the revenue” were frequently employed, particularly in contrast to the competing frame advocating for investing some of the revenue in infrastructure and Norwegian industry. This competing frame offered a broader definition of the problem and its causes, emphasizing how to invest and allocate the revenue to enhance a “qualitatively better society,” rather than exclusively defining long-term interests as financial savings. However, by 1990, the Ministry of Finance, aligning itself with contemporary macrotrends and the prevailing economic policy paradigm, had consolidated its narrative of an Oil Fund dedicated to savings rather than industrial investment.

Table 3. Strategic framing, policy regime, and policy paradigm in the years 1990–1997

By 1997, the anticipation of a substantial increase in revenue prompted a shift in the state economists’ perception of the prevailing problem. While still emphasizing the overarching strategy of safeguarding the revenue, the initial approach of investing in bonds was deemed suboptimal in terms of returns and arguably required reconsideration. Consequently, the moral dimension was expanded to include a duty to maximize financial savings for the sake of future generations. Alternative ideas, such as a gradual pace of extraction or introducing ethical considerations, were effectively discarded in favor of the moral imperative to maximize financial savings for the grandchildren. Furthermore, the strategy of depoliticization was solidified by framing the Oil Fund strictly as a financial investor without ethical guidelines.

In the context of the expert influence perspective (Christensen Reference Christensen2021; Dür Reference Dür2008), the Government Petroleum Fund Act of 1990 and the investment mandate constituted the bedrock of the new policy regime. Despite the initial skepticism in the Ministry of Finance towards a fund, they were able to dictate the institutional design of the Oil Fund, informed by the prevailing policy paradigm. The strict regulations mitigated the threats from politicians and interest groups eager to spend money, contributing to the institutionalization of economists as guardians of policymaking processes. Another feature illustrating the relationship between the evolving policy regime and the economic policy paradigm was the heavy reliance on the market and the efficiency ascribed to market mechanisms. Resting on the assumption that markets are efficient (Fama Reference Fama1970), the argument was that deviating from the financial investment strategy would compromise returns and, consequently, let down future generations.

Maintaining policy regime legitimacy (1999–2010)

The accumulated value of the Oil Fund and the high visibility of a fortune in public savings changed the terms of the political debate. The Progress Party (Fremskrittspartiet), a populist right-wing party, became the primary proponent of increased public expenditure on welfare, infrastructure, and tax cuts. The party perfected a rhetoric that linked any visible shortcomings in Norwegian public services to the fact that Norway had become “one of the richest countries in the world” (#1, #5, #10). This message resonated with large parts of the electorate, who rewarded the Progress Party with gains in the polls while the Labour Party (Arbeiderpartiet) suffered. When Jens Stoltenberg became prime minister in 2000, the issue was hotly contested both in public debate and within his own party (#1, #5). His newly appointed finance minister Karl-Eirik Schjøtt-Pedersen faced mounting pressures, illustrated by a fellow Labour Party member’s rhetorical critique: “Karl Eirik behaves as if he has lost the PIN code to the Oil Fund” (Stoltenberg Reference Stoltenberg2016, p. 184).

It gradually became apparent that something had to give, and the Ministry of Finance was concerned about the potential consequences of the lack of clear guidelines. Without the implementation of a “safety valve” the entire “dam” was in danger of breach – with far-reaching consequences (#10). The new policy plan was prepared in strict secrecy, with the involvement of a selected group of bureaucrats, as well as Prime Minister Stoltenberg and Minister of Finance Schjøtt-Pedersen, who, while not trained as an economist, had always “thought like one” (#5). A considerable amount of time was dedicated to determining the best way to formulate and communicate a new fiscal policy in a manner that would be understood and accepted by ordinary voters. Furthermore, the new policy had to gain support across party lines and be perceived as legitimate as a long-term solution. In the internal ministry debate, the suggested term “chalk line” as an upper limit for spending was thrown out in favor of a more permanent notion: the fiscal rule. The new rule stipulated that the annual non-oil deficit should be limited to an average of 4 percent of the Oil Fund, aligning with what was considered to be a credible long-term real rate of return. Schjøtt-Pedersen characterizes the simplicity of the fiscal rule, making it easy to grasp, as its most important feature:

We needed a new system that could be explained and understood by the voters. The fiscal rule is a pedagogical and rational rule that explains in a plain manner how we can spend the proceeds – not the principal amount. From a professional point of view, we had to develop a system for how to spend some of the oil revenue in a financially sustainable manner. (#5)

When the new policy was presented, Prime Minister Stoltenberg explained the fiscal rule as a continuation of Norwegian agricultural traditions: “like good forest management, we only log the increment, not the forest itself.”Footnote ⁹ In the following debate, Progress Party leader Carl I. Hagen ridiculed the fiscal rule as “a new god” that all the other parties would obey although it was actually “a theoretical construct crafted by the weavers and tailors in the Ministry of Finance.”Footnote ¹⁰ However, the framing strategy of Stoltenberg and his colleagues in the Ministry of Finance proved to be politically effective, and when Parliament adopted the 2002 national budget, the only party to vote against upholding the fiscal rule was the Progress Party.

A second line of contention revolved around the issue of ethical and socially responsible investment, a topic that had been under discussion since the inception of the idea of investing in equity markets in 1997. For years, Ministry of Finance officials and a large parliamentary majority had rejected any suggestions of incorporating ethical concerns, arguing that the Oil Fund should remain apolitical, and that failure to achieve this would reduce the rate of return and thus in effect let down future generations. The message was unequivocal:

The Oil Fund […] should be managed with only financial considerations (risk and return) in mind. Other considerations may be attended to through other means in foreign policy, aid policy and environment policy.Footnote ¹¹

Norges Bank cautioned that negative screening would be both challenging and costly, arguing that restrictions were likely to increase administrative costs. Even when the new minority government explicitly included ethical guidelines in its government policy statement, the technocratic message came to overrule the political intentions. As then Prime Minister Kjell Magne Bondevik from the Christian Democratic Party (Kristelig Folkeparti) put it:

They even gave a moral reason; the Oil Fund is for future generations and we should not do anything that might reduce its returns. (#2)

However, a diverse group from civil society and parliamentarians from the Socialist Left Party (Sosialistisk Venstreparti) and the Christian Democratic Party managed to bring ethical problems to the attention of the public. In 2001, the disclosure of the Oil Fund’s position in landmine manufacturing gained national attention, with the effect of utterly transforming public opinion (#7, #19). Norway had signed the international convention to ban landmines and was accused of violating its international obligations and hypocrisy. Furthermore, the International Campaign to Ban Landmines was awarded the Nobel Peace Prize in 1997 by the Norwegian Nobel committee.

The increasing media attention pushed parliamentarians to remark on the matter, and in 2002 Parliament instructed the Government to mandate a commission to look into the integration of ethical concerns into the Oil Fund’s operation. A creative process of institutional innovation ensued, and two years later the commission submitted a proposal which in effect amounted to a set of turnkey ethical guidelines, complete with institutional architecture.Footnote ¹² The proposal broadened the conceptualization of ethical considerations to include an obligation both to ensure savings for future generations and to respect the fundamental rights of third parties; in this way, the commission helped the Ministry articulate the new policy (#12). The ethical guidelines were approved by the Parliament in 2004, including the establishment of an independent Council on Ethics with a mandate to evaluate whether the Oil Fund’s investment in specific companies was in compliance with the ethical guidelines.

After a decade of framing efforts to legitimize a depoliticized fund restricted to financial savings, the Oil Fund’s extraordinary growth polarized public opinion and challenged the existing economic policy regime. Specifically, the authorities had to navigate the dilemma of the saving-versus-spending trade-off and the thorny issue of ethical investment versus conventional economic ideas of rate of return maximization. In early 2000, the spending dilemma was resolved by introducing a new fiscal rule to control spending. While the initial problem was politically-driven overspending, the new problem was defined as finding a stable and predictable way of spending petroleum wealth, without changing the underlying policy regime rules (Table 4). The moral narrative was constructed as a choice between careful long-term planning and irresponsible populism. By framing the new policy as being a continuation of historical traditions and reflecting principles of sound natural resource management, alternative narratives were effectively dismissed. Furthermore, the fiscal rule was portrayed as defining sustainable spending levels that would not harm the economy, thus giving the new policy economic legitimacy. Through careful strategic framing, the original moral message of safeguarding and protecting the Oil Fund from the song of the sirens retained validity, and the assumptions of the dominant policy paradigm remained unchallenged.

Table 4. Strategic framing, policy regime, and policy paradigm in the years 1997–2004

Similarly, efforts to include ethical and environmental considerations in the Oil Fund’s investment strategy run counter to the fundamental idea of a depoliticized fund for financial savings. Despite attempts to highlight the risks of reduced profitability and increased administrative costs, and conceptual efforts to compartmentalize ethics as unrelated to finance, the demand for change became unstoppable. When the state economists eventually had to cede to political arguments, the process of reframing the problem and its causes, along with a new moral sentiment, provided a rationale that connected the economic paradigm and the policy it spawned. By redefining the problem and reconceptualizing risk to include potential negative consequences of investment in companies violating fundamental ethical norms, the appropriate policy instrument to achieve the core objective became the exclusion of these companies. Furthermore, the moral narrative of maximizing savings for future generations was redefined to include the Oil Fund’s long-term dependence on sustainable growth and well-functioning markets.

Strategically framing the fiscal rule and ethical guidelines to align with the Oil Fund’s overall narrative was an effective communicative strategy aimed at securing continued policy legitimacy. Moreover, it also had a strong coordinative function in the policy sphere, providing a shared language for key policy stakeholders that helped them reach a consensus when preparing new policies. This coordination was made easier by the surprising lack of inclusivity in this political process, unusual in a democracy with strong corporatist traditions. At every juncture since 1990, a limited group of actors returned to the decision-making table, effectively sidelining interest groups and smaller political parties from central decision-making processes.

The enduring coalition between the two main parties, the Labour Party and the Conservatives, along with the technocrats, has proven resilient. Notably, despite repeated criticism from the main opposition parties across the political spectrum, neither of them proposed changes during their own time in government. On the contrary, finance ministers from both the Socialist Left Party (2005–2009) and the Progress Party (2013–2000) have actively supported and upheld the established regime. This loyalty can be attributed to the widely accepted and popular narrative of intergenerational solidarity and fiscal prudence, as well as the Oil Fund’s remarkable growth, which has enabled all finance ministers since its establishment to increase national spending. Additionally, the Ministry of Finance has worked rigorously to bring politicians into line. Since 1990, all finance ministers have been explicitly presented with the same scenario (#9, #13): “If you are the first to initiate not only spending the return on investment but also withdrawing money from the principal, your legacy will endure, not just the next decade, nor merely the following decades, but for a century when historians begin documenting the vanishing of the Oil Fund. In this historical account, you will be the lead character.”