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The COVID-19 pandemic raises the question of austerity's problematic social toll for health in the south of Europe. Has EU economic governance constrained health spending? If so, have these spending levels led to inequalities, which in turn shaped responses to the pandemic? EU economic governance is often dismissed as ineffective because of its poor track record of compliance. Yet austerity is blamed for negative health outcomes. This article shows that the EU fiscal rule is a determinant of health because it affects fiscal policies of European countries. First, the analysis of EU member states during 1995-2018 shows that austerity policies affect health spending and health inequalities. Euro-area countries under the EU Excessive Deficit Procedure significantly consolidated their health spending. The contractionary effect was concentrated in southern countries, contributing to rising health inequalities across the core and periphery. Finally, the analysis shows the pandemic implications of health inequalities, as periphery countries with a track record of high consolidation display more stringent (and costly) COVID-19 response models. This analysis contributes to understanding the supranational determinants of health in the EU, showing the pervasive spillover effects of the fiscal framework on national health policies., (Copyright © 2024 by Duke University Press.)

Relying on recent republican political theory, this article introduces and clarifies the concept of creditor domination and applies this concept in an analysis of the eurozone debt crisis and the EU's response to the coronavirus pandemic. The article argues that two conditions, one institutional and one structural—related to the institutionally incomplete European monetary union and a structural transformation in international finance—conspired to render periphery member states in the eurozone vulnerable to creditor domination, to which they were manifestly subject in the eurozone debt crisis. The article also argues that the EU's pandemic response "NextGen EU" represents a fundamental change in Europe's politics of sovereign debt, which, even if only a temporary vehicle for debt mutualisation, has rendered member states much less vulnerable to creditor domination due to the pandemic's economic fallout. Finally, the article discusses Richard Bellamy's proposal for a "republican Europe of states" and argues that Bellamy's proposed reforms, while insufficient to overcome the conditions of creditor domination in the eurozone, point to a dilemma for republicans, who may risk emancipating European citizens from creditor domination only at the cost of subjecting them to the dominating power of a weakly legitimated supranational fiscal authority. [ABSTRACT FROM AUTHOR]

This article examines the European Union's initial response (March–July 2020) to the multifaceted crisis caused by the COVID-19 pandemic. It does so on the basis of two competing hypotheses in relation to what this response indicates about the process of integration. The first is drawn from the literature on 'disintegration' while the second is based on the recent argument [Jones, E., Kelemen, R. D., & Meunier, S. (2016). Failing forward? The Euro crisis and the incomplete nature of European Integration. Comparative Political Studies, 49(7), 1010–1034. https://doi.org/10.1177/0010414015617966] that the EU has been 'failing forward' in reaction to the crises that it has been facing for more than a decade. It is argued that while the first hypothesis ought to be rejected, there is evidence indicating that the EU has responded much more in line with the 'failing forward' thesis. Indeed it is argued that there is (in the EU's initial response) more evidence of the latter (forward) than the former (failing). [ABSTRACT FROM AUTHOR]

The reaction of European Union's (EU) policy makers to the Covid-19 shock was bold and timely; although they could not avoid a crisis whose dimensions made the 2007-2008 Global Financial Crisis pale by comparison, the governments' titanic effort managed, with the support of EU institutions, to mitigate its impact on incomes and employment. This came as a welcome change after the calamitous management of the sovereign debt crisis. But it is precisely the extraordinary dimension of the crisis that prompts the question of whether the activism of economic policy denoted a change in the mindset of EU governments and institutions, or simply was the only option available to policymakers to avoid the collapse of their economies. This paper tries to answer the question through an assessment of the debate on Eurozone reform, with a focus on the "New Kid in Town": fiscal policy. [ABSTRACT FROM AUTHOR]

This article analyses from a law and policy perspectives the measures adopted by the European Union (EU) to address the devastating economic effects of COVID‐19, assessing their implications for Europe's economic and monetary union (EMU). The article first sets the background by exploring the main features of EMU before COVID‐19. Subsequently, it examines the multiplicity of policies deployed by the EU institutions to contain the socio‐economic damages of the pandemic – including, most crucially, the EU recovery fund "Next Generation EU" – and underlines their transformative effect on the EU architecture of economic governance. As the article argues, the responses to COVID‐19 have produced a significant rebalancing of EMU, bridging the asymmetry between EU monetary and economic policy. Finally, the article considers whether the COVID‐19‐related responses are likely to be only temporary, or rather a new normal for EMU, and sheds light on further constitutional adaptations which are needed to sustain this unprecedented transfer of fiscal power to the EU level. [ABSTRACT FROM AUTHOR]

Failing forward describes an endogenous cycle of EU institution-building through lowest-common denominator breakthroughs in Council. This article adds a dynamic called failing outward, in which a powerful country steers EU law and policy from outside the EU. Where strong Council deadlocks persist during crises, and a powerful state possesses a critical, excludable resource, it will make access conditional on EU rules and institutions that reflect its own interests rather than Council compromises. A non-EU institution helps it do this, entrenching conditionality. Repeated institutional fixes follow as the system fails (some) other Member States. This model is applied to Germany's effective authority through the European Stability Mechanism over Council and Commission in determining EMU reforms, including Banking Union. [ABSTRACT FROM AUTHOR]

Since 2008-09, the European Union (EU) experienced two major economic crises revealing all the flaws of the existing model of economic governance. By leaving the majority of the countries with high levels of deficit and public debt, the two crises have shown that the Economic and Monetary Union (EMU) is indeed an unfinished project where the monetary union alone is not sufficient to safeguard the entire EU economy. To strengthen the EMU and to mitigate future risks that could possibly lead to the collapse of the euro-area, many called for a deeper fiscal integration by creating a central fiscal capacity for the EMU or, in other words, a fiscal union. Due to the present political unfeasibility of such an endeavour, however, concrete steps towards a European Fiscal Union (EFU) have been modest and the revised Stability and Growth Pact (SGP) remains its core building block. As the Pact defines supranational and shapes the creation of national fiscal rules, maintaining its credibility continues to be vital. This article analyses the effects of the fiscal rules on the public finances of the member states. It is assumed that by adhering to the supranational and adopting quality domestic fiscal rules, the member states are better equipped in remaining fiscally prudent, thus also affirming the revamped SGP as a solid base for the furthering of the EFU. The two-track evaluation approach defines dynamic panels for the EFU as a whole and for the selected country groups. It finds certain benevolent effects on budgetary performance at the EFU level, as well as for the countries with higher quality of the fiscal rules. [ABSTRACT FROM AUTHOR]

European integration is associated with the idea of an 'ever closer Union', achieved in part through 'integration-through-crisis'. However, while crises have led to higher regulatory pressure, responses to these crises have not always taken the form of stronger commitments and legally binding rules. Based on the study of three policy areas recently affected by crises, this article aims at analysing why in one of these policies (migration) more soft rules have been adopted, while the two other policies have evolved towards a greater use of hard law (budget monitoring, cybersecurity). Three potential explanations are analysed: the intensity of crises impacting political systems; the quality of prior norms and their (perceived) implementation; the entrepreneurship and heterogeneity of the coalition. Although all of these factors have explanatory powers, the capacity of policy entrepreneurs to build a large coalition appears to be the central explanation. [ABSTRACT FROM AUTHOR]

In the almost 27 years since the signing of the Treaty of Maastricht (ToM), the EMU has transformed into a complex institution, the complexity and powers of which have exceeded even the most promising predictions. Over the years, EU actors have developed a substantial dependent relationship, where asymmetric power plays a crucial role; in fact, asymmetry and asymmetric power have become the unifying glue for economic integration. The main purpose of this study is to analyze and evaluate the importance of asymmetric power in order to understand dynamics and change in the EMU and to determine through which mechanism the economic integration process has been asymmetrically promoted. As we will argue, within the EMU, there seems to exist a specific feedback loop mechanism, through which the dominance of powerful MS is reproduced in the way policy is proposed within contemporary EMU politics. The reproduction of asymmetric power within the EMU plays a key role in shaping the system of governance and in decision-making, and through economic integration, appropriate dynamics have been created to diffuse and reproduce asymmetric power. [ABSTRACT FROM AUTHOR]

This article is devoted to major measures undertaken in order to reform the EU macroeconomic policy as a result of Eurozone crisis. It is a highly crucial issue for academic research due to multiple problems that occurred in the Eurozone states as a result of the 2008 world financial crisis. It is also an interesting issue for research because of the EU’s activities targeted at insuring efficiency of the EU institutions and support of problematic member states. Research objective of this article is examination of the Eurozone crisis influence on the evolution of institutional aspects of the EU macroeconomic policy. The methodological basis of this research is composed of positive economics, comparative analysis, structural and functional analysis, and theoretical aspects of rational choice institutionalism. As a result of the research, it was demonstrated that internal debates within the EU had negative impact of the Eurozone crisis, institutional reforms undertaken to solve the crisis were not finalized, but eventually the European Union managed to find solutions to solve the EMU problems in the context of macroeconomic harmonization. The practical importance of this article is determined by evaluation of the current Eurozone situation and efficiency of institutional reforms.

For the first time, this paper investigates the influence of ordoliberalism (OL) at both the ideational and regulative levels of European integration processes regarding agricultural policy (i.e. CAP), competition policy, and economic and monetary policy (i.e. EMU) in comparison. The analytical key is an operationalisation of OL into five elements. The paper generally confirms the hypotheses proposed that OL was and remains an ideational influence of some importance, without exaggerating this influence, for European integration processes, both at the constitutive level as well as – but less so – at the practical level. However, there are differences in the degree of influence across the various policy areas. The influence is weakest in CAP and strongest in competition policy, but only since the Internal Market was proposed in the mid-1980s. [ABSTRACT FROM AUTHOR]

This paper explores how European integration, economic fluctuations, and the interactions of these factors affect bilateral migration flows. It focuses on how migration flows developed in the wake of the establishment of the European Monetary Union, and whether migration flows became stronger, and more responsive to economic fluctuations, in the euro area. It estimates a gravity equation of bilateral gross migration flows on a global sample and on a sample restricted to the first 12 members of the euro area. It is found that unemployment is a strong and robust determinant of bilateral migration flows both globally and in the euro area. EU accession and the lifting of labour market restrictions on new member states had a large effect on gross migration flows. While mutual euro area membership is not associated with an overall rise in migration, it is associated with increased flows from countries where unemployment is high to those where it is lower. Migration flows among the euro-area 12 have been on an increasing trend since the late 1990s; after falls in 2009 they picked up again in 2010 and 2011. The evidence overall suggests that labour mobility plays an increasing role in the adjustment to asymmetric shocks in the EU and the euro area. [ABSTRACT FROM AUTHOR]

The European Union has adopted several strategies to cope with a set of inter-related problems. The best known is the Europe 2020 strategy with its focus on smart, sustainable and inclusive growth. Another is fostering balanced macro growth via a strengthening of the EMU. Finally the cohesion policy has to cope with spatial unbalances. The objective of this paper is to highlight the main issues in three policy fields: competitiveness, EMU and cohesion.1 Two scenarios for post 2020 development are described, which show the need for further strengthening of EU policies and of the quality of government at all levels.

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The core objective of this paper is to determine the main political and economic conditions and challenges related to the possible evolution of the integration process in the euro area toward fiscal federalism and fiscal union as a way to increase the capacity of the area to cope with future economic and financial crises. The issue of a separate budget for this area is of particular interest in this article. The idea of such a budget has recently become the subject of lively public debate in the European Union and has been a factor in encouraging the European Commission to propose new solutions at the end of 2017 in the field of economic governance of the euro area, including the establishment of a European Monetary Fund. The analysis carried out in this article leads to the conclusion that under the current conditions, there is little chance of introducing such regulatory and institutional changes that would significantly increase the scale of financial transfers between the euro area member states. [ABSTRACT FROM AUTHOR]

The article explores the main competing visions of a fully-fledged European banking union. Building on a historic overview of principal choices related to the previous European banking policy reforms, it identifies four ‘ideal’ models of the new institutional framework: full, corrective, preventive and incomplete. The empirical analysis of national preferences on key policy options related to the recent banking policy overhaul reveals that in the final stages of negotiations the majority of Member States and EU institutions strongly preferred the ‘full’ banking union model, defined by a full scope of supranational supervision and a high degree of bank risk sharing. However, the results of the EU bargaining process show that recent agreements better correspond to the ‘preventive’ banking union form. The article adds a new perspective to the existing accounts on the creation of the banking union, suggesting how an open-ended definition of European initiatives contributes to deepening integration. [ABSTRACT FROM PUBLISHER]

In a reflection paper intended to generate debate among euro-area governments, the European Commission has put forward ideas on what could be done to deepen the Economic and Monetary Union by 2025. One of the ideas outlined by the Commission is the creation of a euro-area budget. This article reviews the key issues that are relevant in the discussion on establishing such a budget; outlines the possible functions of such a budget, such as incentivising structural reforms or ensuring macro-stabilisation; and discusses the issues of size, funding, moral hazard and governance, while touching upon the role of non-euro-area member states. The article concludes with the assertion that the answer to this question is essentially political in nature and could constitute an example of how member states are ready to integrate further, while giving non-euro-area member states the opportunity to participate. [ABSTRACT FROM AUTHOR]

One possible explanation for the European sovereign debt crises is that the European Economic and Monetary Union (EMU) gave rise to consolidation fatigue or even deliberate over-borrowing. This paper explores the validity of this explanation by studying how three decisive stages in the history of the EMU affected public borrowing in EU member states: the signing of the Maastricht Treaty, the introduction of the Euro, and the suspension of the Stability and Growth Pact (SGP). The methodology relies on difference-in-difference regressions for 26 OECD countries over the 1975-2009 period. The findings indicate that the Maastricht treaty reduced deficits especially in traditionally high-deficit countries. In contrast, the introduction of the Euro and the watering down of the original SGP led on average to higher borrowing. These results indicate that the introduction of the Euro and the suspension of the SGP led to soft budget constraints in the EMU. [ABSTRACT FROM AUTHOR]

The article analyses the manifestations of a market failure problem revealed during the economic crisis in the euro area, namely business cycles, market inability to ensure money circulation and avoid inflation. It is shown that the cyclicity of economic development has revealed in various degrees of economic contraction and different rates of its recovery. These differences have been exacerbated by the new procyclical factors emerged from the transition to a single currency. As for money circulation the crisis has almost no impact on the single currency functioning: the euro has maintained its position on the world market and properly performed money functions in the domestic. The goal to achieve economic development without inflation in the euro area generally has been solved successfully by the European Central Bank (ECB). However, due to the fact that the ECB in its monetary policy does not pay sufficient attention to the increased inflation in small and relatively poor countries, the crisis has been more acute in them than in large countries with low inflation. The goals of ensuring money circulation and avoiding inflation can be settled more effectively in the euro area in case of more tight coherence in economic policy and strengthening of supranational mechanisms of economic governance.

The article analyses the manifestations of a market failure problem revealed during the economic crisis in the euro area, namely business cycles, market inability to ensure money circulation and avoid inflation. It is shown that the cyclicity of economic development has revealed in various degrees of economic contraction and different rates of its recovery. These differences have been exacerbated by the new procyclical factors emerged from the transition to a single currency. As for money circulation the crisis has almost no impact on the single currency functioning: the euro has maintained its position on the world market and properly performed money functions in the domestic. The goal to achieve economic development without inflation in the euro area generally has been solved successfully by the European Central Bank (ECB). However, due to the fact that the ECB in its monetary policy does not pay sufficient attention to the increased inflation in small and relatively poor countries, the crisis has been more acute in them than in large countries with low inflation. The goals of ensuring money circulation and avoiding inflation can be settled more effectively in the euro area in case of more tight coherence in economic policy and strengthening of supranational mechanisms of economic governance.

While banking supervision in the European Union (EU) had been subject to slow incremental changes in the 2000s, the establishment of the Single Supervisory Mechanism (SSM) in 2012/2013 amounted to a comparably swift and significant transfer of sovereignty. This article explores the institutional dynamics behind this sudden shift from incremental to punctuated change. We show that powerful ‘reproduction mechanisms’ of institutional stability were decisively weakened by the euro area crisis and the existential need to break the feedback loop between banks and sovereigns. The institutional breakthrough came about as a package deal, linking banking supervision to a short-term crisis management measure for direct bank recapitalization. In focusing on the twin dynamics of previous stability and sudden change and structural and institutional factors behind the decisive turning point at the June 2012 summit, this article adds a new perspective to previous accounts and their emphasis on individual actors, functionalist learning processes or ideational aspects. [ABSTRACT FROM AUTHOR]

The creation of the EMU in 1999 gave its original eleven members additional advantages for intra-EMU trade, relative to other members of the EU and the rest of the world. Other things being equal, this should have resulted in greater export affinity within the Euro Zone. This paper constructs export affinity indices for the intra-regional exports of the EMU, for its exports to the then other members of the EU, and to the countries that joined the EU during this period, for 1997, a full year before the Euro, and for 2007. These are used to see whether the net effect on export affinity are as expected, or whether other forces affecting the growth and direction of world exports led to different results. It was found that though there was clear export affinity within the EMU in both years examined, and, of course, tremendous growth in total exports to all regions, export affinity fell rather than rose between the two years. As far as special affinity is concerned, other factors affecting the development of world exports cancelled the advantages both of EMU membership and of new membership in the EU. Similar net results were found for bi-lateral export affinity indices of the original EMU members. [ABSTRACT FROM AUTHOR]

This article discusses the legal and political context regarding the origin of money in the Croatian political space. Namely, the paper presents a historical and legal review starting from the Ancient Times, e.g. the oldest Croatian money of king Andrew II to the present official Croatian currency. In addition to the legal and historical aspects of the official Croatian money, the paper also discusses fate of Croatian money after Croatia’s accession to the European Union and to the European Monetary Union, i.e. the Eurozone.

In the wake of the euro area crisis, the debate on instruments to deepen economic integration among its members has intensified, among others putting forward a fiscal stabilization capacity for Economic and Monetary Union (EMU) members. Contributions made so far to further this idea have mostly concentrated on the expenditure side and possible stabilization properties. This analysis reviews the most important proposals and discusses design choices and institutional conditions to develop the revenue side of such a fiscal instrument. [ABSTRACT FROM AUTHOR]

Quoting Sir Winston LS Churchill, "However beautiful the strategy, you should occasionally look at the results", we tried an analysis of the influence the cohesion policy of the EU has on Romania's development. We took account of the specific literature, of the existing economic theories and legal framework, the result being directed to discovering - rather than on confirming or denying - hypotheses. The starting point of the proposed analysis is: "the differences between the economic development of Romania compared with other member states, focusing in particular on those differences relating to prosperity, living standards and productivity". [ABSTRACT FROM AUTHOR]

Since the outbreak of the eurozone's sovereign debt crisis, a range of fiscal policy measures have been adopted at the European Union (EU) and national levels that have given rise to claims of a significant reinforcement of fiscal policy constraint. Given the prominence and reinvigorated political appeal of fiscal rules in the EU and beyond, it is disconcerting how little we actually know about the link between fiscal rules, budgetary outcomes and market behaviour. In this research note, the aim is to take stock of the existing literature and challenge its contribution to the current policy debate on the merits of fiscal rules. Specifically it will focus on problems linked to endogeneity, measurements and contextuality. [ABSTRACT FROM AUTHOR]

An economic union (namely a common fiscal and monetary policy) would still not be enough, because logic requires a common diplomatic policy as extension of the common economic policy, and a common defence policy as extension of diplomacy. [ABSTRACT FROM AUTHOR]

I believe that Romania's accession to the Euro should be delayed, not necessarily because we might not be ready, in terms of real convergence, but because, for the moment, the future of the European currency is under the sign of uncertainty. [ABSTRACT FROM AUTHOR]

Perhaps more than ever in the already long making of the European integration there have not been on the policy makers table, in the lot of challenges the actors business have to cope with and in the set of concerns of the European citizens, so many topics which must be immediately addressed with sustainable solutions. The signs of crisis become more obvious, a crisis that seems to have installed itself at the level of solidarity, fundamental principle of integrationist construction, whose effect is paralysis at the level of decision making and action. What becomes increasingly clear is that we cannot afford to lose time and opportunities for effective cooperation nor to waste time to raise accusations against some Member States or EU bodies. It must be urgently identified what can be done both separately, but also together, for the synergy boost necessary for the organization. [ABSTRACT FROM AUTHOR]

The Euro Area crisis has not passed and is not limited to public and private indebtedness. Otmar Issing, former chief economist of the European Central Bank, reiterated in Bucharest this April that the Euro Area started on one leg (the monetary policy) and that it lacks appropriate fiscal arrangements. He is not the only prominent voice who made this observation. Alexandre Lamfalussy, an architect of the Euro, noted that various obstacles obstruct fiscal integration. The McDougal Report, prepared at the request of the European Commission, has showed, ever since 1978, that a monetary union needs a common budget. Van Rompuy, and more recently Pierre Moscovici speak about the need for a "fiscal capacity". I mentioned this to highlight that discussing about the accession while looking only inwards is not intelligent. The great lessons of the recent crisis also provide answers to questions with respect to the right time of accession to the Euro Area. [ABSTRACT FROM AUTHOR]

In the context of the Eurozone crisis this paper re-examines the Hard ECU using the concepts of the macroeconomic trilemma and the political trilemma. We find that the Hard ECU would have been less economically and politically damaging than the euro. We conclude that it was a superior approach to monetary union. [ABSTRACT FROM AUTHOR]

Firstly, the study draws out symmetrical subsets of 27 member countries of the European Union (EU27) countries according to their extents of business cycle symmetry with the whole of EA12, quantified by correlations of cycles between the countries' GDP components and the EA12s GDP. The objective is to evaluate the obtained country groupings against the EA12 countries, the initial members of the euro club. This exercise is implemented using hierarchical cluster analysis for pre- and post-euro periods. As a robustness check, a principal component analysis is applied. Secondly, the analysis deploys a discriminant technique on the cluster analysis solutions to identify the GDP component whose cycle synchronicity contributes most to separation of the countries. In a nutshell, the findings suggest a significant rise in fragmentation within EU27 and within EA12 after euroization and that cycle synchronization involving the GDP component of private investment as a more important determinant to country classifications. [ABSTRACT FROM AUTHOR]

Copyright of HUM: Journal of the Faculty of Arts at the University of Mostar is the property of University of Mostar, Faculty of Arts and its content may not be copied or emailed to multiple sites or posted to a listserv without the copyright holder's express written permission. However, users may print, download, or email articles for individual use. This abstract may be abridged. No warranty is given about the accuracy of the copy. Users should refer to the original published version of the material for the full abstract. (Copyright applies to all Abstracts.)

This article examines the association between trade and financial linkages among 18 European countries. We find that, with the introduction of the euro, trade imbalances among euro area members widened considerably, even after allowing for permanent asymmetries in trade competitiveness within pairs of countries or in the overall trade competitiveness of individual countries. Moreover, there is a significant relationship between patterns of trade and bilateral financial linkages, especially within the euro area; a surplus of a country in a bilateral trade relationship is typically accompanied by a country’s positive net financial position vis-à-vis the respective partner country. (JEL codes: F15, F16, F32, F36, F42) [ABSTRACT FROM AUTHOR]

Faced with the global financial crisis and an increasingly worrisome sovereign-debt crisis, the Eurozone countries are rethinking their fiscal governance. This paper discusses the different reforms and subsequent fiscal rules which have emerged since 2011. It assesses the impact of fiscal rules on the output gap and inflation rate of three representative countries of the Eurozone. By means of a counterfactual, the rules based upon their macroeconomic outcomes are ranked. The new debt reduction rule would certainly lead to lower debt levels, hence to larger fiscal margins for maneuver in the future but, in steep contrast with the golden rule of public finance, it would be very costly to implement as the requirement to enforce a substantial consolidation in the short run would be considerably higher than that of a golden rule and would worsen the output gap and inflation rate. The cap on the cyclically adjusted deficit also leads to unfavorable outcomes whereas the Maastricht status quo, limiting overall public deficit, would be a 'second best' behind the golden rule of public finance.JEL Classifications: C54, E62, H68 [ABSTRACT FROM AUTHOR]