Policy instruments are techniques used to implement policy goals. Subject to political conflict, they address the relationship between those who govern and those who are governed. Why do political actors choose certain policy instruments to implement policy goals? Systematically comparing policy instruments employed in the European Union's environmental and social policy, Holger Bähr develops a general theoretical framework to illustrate how policy-makers prefer different types of policy instruments depending on the respective effect they wish to have on member state governments, citizens, consumers, and producers. He argues that institutions, the politicisation of policy problems and external events constrain political actors and provide them with the opportunity to transfer their preferred policy instruments into policy outputs at the end of decision-making.