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Do integration crises reinforce legal differentiation in European integration? Are differentiated EU policies under stress prone to cascading opt-outs? We argue that integration crises as such are unlikely to cause further fragmentation in already differentiated EU regimes. If the EU decides to adopt new treaties and laws in response to the crises, however, these are likely to reproduce and extend pre-existing patterns of differentiation. Empirically, this study offers within-case counterfactual analyses of differentiation in the Euro and the migration crises. Whereas the Euro crisis triggered a major institutional change in the Eurozone, the member states could not agree on a thorough reform of the asylum system. Correspondingly, we observe excess differentiation in the Euro crisis but stable differentiation in the migration crisis., European Union Politics, 24 (1), ISSN:1465-1165, ISSN:1741-2757

Despite being symmetric in its very nature, the Covid-19 shock is affecting European economies in a very asymmetric way, threatening to deepen the divide between core and peripheral countries even more. It is not Covid-19 itself, however, but the contradictions within the EU’s growth model and institutional architecture that would be to blame for such an outcome. The dramatic impact of the economic crisis brought on by the pandemic and the threat that it poses to Eurozone survival seem to have forced a reluctant Germany into action: a minor step, but an important signal. This note analyses the crossroads currently facing Europe—the risk of disintegration vis-a-vis the opportunity for a ‘Hamiltonian moment’—discussing possible future scenarios in the light of past developments.

In the German parliament, the Bundestag, floor time is a scarce resource and is allocated to MPs by leaders of their respective parliamentary party groups. Previous research indicates that highly salient plenary debates tend to be dominated by party leaders and other loyal frontbenchers. Plenary speeches can therefore offer only limited insights into party unity. Any MP can give a so-called ‘explanation of vote’ (EoVs) to justify their voting decision and/or express their point of view. These written statements provide a more accurate depiction of the range of viewpoints present within legislative parties. In order to assess the effect of party control on observed party unity and parliamentary contestation, discourse network analysis has been employed in this study to compare legislative speech with EoVs in debates on the Greek crisis between 2010 and 2015. Discourse network analysis combines content analysis with an actor-centred approach, and this is the first time this method has been used to study party control and (dis)unity. Bundestag debates on the Greek crisis present an interesting case study, as the issue became increasingly controversial over time, both in the public and the legislature. While this became evident in declining voting unity and individual-level mobilisation through EoVs, the extent to which gatekeeping impedes contestation on the plenary floor needs to be assessed. In terms of representation, it is important that European Union issues not only make it to the plenary agenda but that these debates also reflect the different viewpoints of MPs.

Although European integration has become an increasingly salient and controversial topic in domestic politics, the consequences of this politicisation of the European Union for the integration process have not received adequate scholarly attention. To fill this lacuna, this article devises five hypotheses on the effects of politicisation for the integration process, which are subsequently tested against the evidence of the Euro and Schengen crises. Both crises had comparable origins, but the Euro crisis caused substantial deepening of integration, while the Schengen crisis has not engendered any meaningful reforming steps. The empirical analysis finds that politicisation assumed different forms across the two crises, which is shown to be one causal factor that explains the variation in crises outcomes. The article thereby contributes to a multifaceted understanding of the politicisation of international institutions, EU integration theory and the dynamics of the Euro and Refugee crises.

© 2018 Walter de Gruyter GmbH, Berlin/Boston. Previous research has identified the frames and metaphors used in the reporting on the Euro crisis. War and disease turned out to be the two most frequently used metaphorical frames. Since coverage of the current financial crisis may have a tangible effect on public opinion, research into the effects of metaphorical frames on attitudes is needed. By employing two survey experiments, a student sample (N = 259) and a nonstudent sample (N = 507), this article traces the effects of both metaphorical frames. Our results show that individuals take over the metaphorical frame elements in their evaluation of the Euro crisis. Participants in the war conditions significantly more often referred to war when answering the open questions. Alternatively, when the Euro crisis was framed as a disease, participants were more likely to use words and sentences containing disease frame elements. ispartof: Communications-European Journal of Communication Research vol:44 issue:4 pages:447-468 status: published

International audience; The aim of its introduction is threefold: We start from a conceptual clarification of preference formation, defining it provisionally as a political process ‘by which social actors decide what they want and what to pursue’. After an analysis of different conceptual and theoretical approaches, the introduction offers a critique of liberal intergovernmentalism, one of the major explanatory frameworks of preference formation in European Union studies. This critique centres on the context in which national preference formation took place during the European Monetary Union crisis. This special issue argues that the conceptualisation of preference formation as state-based, unidirectional and unchanged by the regime is deeply problematic. Preference formation is typically messy and non-linear and rarely closed to the possibility that both preferences and positions may change, sometimes radically, it is even more complex, context-sensitive, and open to a wide range of influences in a multi-level system such as the European Union. In other words, the traditional understanding of preference formation as a purely domestic process of interest aggregation and competition require revision given the multiple factors that shape preferences in general and in the interdependent policy-making of the European Union in particular.

The European Central Bank is one of the most independent central banks in the world, but this independence is also highly constrained: the Maastricht Treaty established a primary mandate to pursue price stability and prohibited it from engaging in monetary financing. Using an historical institutional framework, this article analyses the ECB’s unconventional monetary policy during the euro crisis. The Maastricht Treaty’s constraints forced the ECB to act incrementally during the crisis and rely primarily on the layering of institutional changes. Nevertheless, the self-reinforcing effect identified by historical institutionalism meant that these gradual changes had important consequences over time. The unconventional monetary policies are contrasted with the more drastic institutional change instigated by the Member States, the ECB’s designation as the Single Supervisory Mechanism. The self-reinforcing effects and path dependence set by the ECB’s high degree of independence in the Maastricht Treaty, however, also constrained the EU in ensuring the accountability of the ECB, as the accountability structure is another instance of layering despite the very different nature and consequences of financial policy supervision.

There is little doubt that the European Central Bank (ECB), and in particular its presidency, has taken the lead in tackling the euro crisis. But can this leadership be also characterised as charismatic? This article answers the question by focusing on language – a key component as well as a reliable indicator of charisma. By means of a software‐assisted content analysis of the entire corpus of ECB presidential speeches, it is found that the crisis has indeed led to the emergence of the Bank's presidency as a charismatic euro leader. This in turn confirms the recent politicisation of the ECB, but at the same time might be seen as mitigating the problems related to the Bank's democratic deficit, to the extent that charisma can be seen, from a Weberian standpoint, as an alternative source of political legitimacy.

Die nicht-hegemonial verankerte EU-Interventionsstaatlichkeit im Herrschaftsmodus der (Selbst-)Disziplinierung stellt die Akteur*innen in der Europäischen Union vor große Herausforderungen. Der Autor widmet sich, aufbauend auf den Traditionslinien kritischer Europaforschung, dem durch die Euro-Krise induzierten EU-Staatlichkeitsausbau und entwickelt ein eigenes begriffliches Verständnis der EU-Staatlichkeit. Auf Grundlage einer historisch-materialistischen Staatlichkeitsanalyse präsentiert er eine Einordnung der Politik zur Bewältigung der Euro-Krise in den Gesamtzusammenhang der EU-Staatlichkeitsgenese.

The combination of downward nominal wage rigidity and pegged exchange rate creates an externality which leads to excessive wage inflation (Schmitt-Groh_e and Uribe, 2016). This paper re-examines this result assuming that wage setters are forward looking, hence endogenously restrain wage increases facing downward wage rigidity, as in Elsby (2009). In this case, wage inflation is either excessively high or excessively low compared to the social optimum: while wages increase too strongly following demand shocks, they rise by too little following Balassa-Samuelson-type technology shocks. Applying the model to euro area countries, I document excessively high wage inflation rates in the euro periphery, but excessively low rates in the euro core, in the pre-crisis period. The ADEMU Working Paper Series is being supported by the European Commission Horizon 2020 European Union funding for Research & Innovation, grant agreement No 649396.

This article analyses the development of financial assistance in the Eurozone since 2010. It argues that reforms to instruments and bodies, notably the European Financial Stability Facility, the European Stability Mechanism, and the current Covid-19 recovery fund, are best explained by a re-occurring pattern of negotiations between potential creditors and debtors based on common Eurozone interests and national cost-benefit considerations. Building on a liberal intergovernmentalist approach, this article shows how this pattern influenced the step-by-step reform of financial assistance in the Eurozone. The threat to Eurozone stability served as a constant factor encouraging member states to expand and deepen the assistance formula. Creditors’ cost-benefit considerations were key for retaining disincentives, a limited liability for common debt, and intermediary borrowing and lending within the financing design. However, on the back of common Eurozone interests, debtors were able to push for an increase in assistance, an expansion of assistance into areas of banking sector support, and a softening of moral hazard elements in the more recent Covid-19 pandemic. Due to creditors’ continuous insistence on safeguards and limited burden-sharing, reform outcomes were repeatedly unable to resolve the difficulties at hand.

The euro crisis has sparked changes in the EU's economic governance framework and a crisis of legitimacy across the union. While the institutional repercussions of the crisis have been studied before, the democratic impact at the national level has received much less attention. This paper aims to fill this gap, focusing on the procedural changes that the EU's new economic governance (NEG) framework has brought to national budgetary decision-making. Building upon the Varieties of Democracy framework, the paper adds empirical nuance and conceptual clarity to the notion of 'throughput legitimacy' and its components: openness, inclusiveness, transparency and accountability. Detailed case studies of post-crisis Austria, Italy and Portugal show that the NEG improved access to national budgetary decision-making and enhanced executive scrutiny, while excessive complexity remains the Achilles' heel of EU fiscal rules. We submit that these procedural changes are too meaningful to be overlooked in post-crisis debates about EU democracy.

During recent years, central banks have increased the levels of their international reserves at an unprecedented pace. In this paper, we introduce new country-specific reserve data and examine determinants of the composition of inter- national reserves. Using a dataset of 36 countries (and the euro area) for the years from 1996 to 2016, we identify currency pegs and trade patterns as determinants of currency compositions. Our results emphasize the importance of transaction moti- ves for the composition of currency reserves. The euro crisis appears to have been a setback for the euro, which temporarily seemed to challenge the US dollar as the most important international reserve currency and potentially impacted the deter- mination of international reserve compositions.

The European Union (EU) response to the euro crisis brought new relevance to the debate on socialization through European institutions. While previous studies differ in their support for EU socialization, many have argued that the euro crisis revealed a far-reaching convergence of views among Europe's leaders. Theoretically, the European Central Bank (ECB) in particular is expected to have the power to socialize its governors into a common worldview. The present article questions this proposition. Using the technique of cognitive mapping to provide an in-depth analysis of the views of five members of the ECB Governing Board, we find that even for ECB governors national culture generally trumps EU socialization. Only for ECB President Trichet significant evidence of EU socialization is found. The study also points to some new scope-conditions for socialization that may further our understanding of how European institutions may foster the sustainable socialization of views.

This paper assesses the effect on banks’ lending activity of accepting illiquid collateral at the central bank refinancing facility in times of wholesale funding stress. We exploit original data on the loans granted by the 177 largest euro area banks between 2011m1 and 2014m12 and on the composition of their pool of collateral pledged with the Eurosystem. During this period, two-thirds of the banks in our sample experienced a sizable loss of wholesale funding. Panel regression estimates show that the banks that pledged more illiquid collateral with the Eurosystem reduced their lending to non-financial firms and households less : a one standard deviation increase in the volume of illiquid collateral pledged corresponded to a 1.1 % increase in loans to the economy. This result holds for banks that were and were not run. Our finding thus suggests that the broad range of collateral eligible in the euro area may have helped to mitigate the credit crunch during the euro debt crisis., Barthélemy Jean, Bignon Vincent, Nguyen Benoît. Monetary policy, illiquid collateral and bank lending during the European sovereign debt crisis. In: Economie et Statistique / Economics and Statistics, n°494-496, 2017. The Crisis, Ten Years After. pp. 111-130.

Published online: 19 Sep 2017 This article highlights the renaissance of the essentialist topos of the ‘lazy and irrational’ ‘Südländer’ (Southerner, Southern countries, South) in the German political and media discourses during the ‘Euro crisis’. It argues that it served to legitimate the political and economic measures taken in Southern European countries that pushed them into still more peripheral positions within the European Union (EU) and deepened the cleavage between North and South. Culture, or better culturalism and racism as its political ideological version, thus were used as a trap, as an intellectual battleground for justifying extremely complex economic and political decisions in a simplistic fashion throughout a crucial period of European history. The article furthermore demonstrates how a postcolonial reading may productively decode the processes of Othering taking place within Europe itself, especially between the so-called core and peripheral countries.

In times of crisis, political leaders are torn between calls for strong leadership and the need to maintain their license to operate amongst their constituents. The predicament of European Heads of State and Government (HSG) during crises provides a particularly strong example of this. For on top of the inherent tension between political leadership and democracy, in the European multi-level system, HSG have to balance the demands of many groups of potential followers while facing weak and contradictory vectors of legitimate leadership. This contribution presents a framework by which the inherent tensions of legitimate European leadership may systematically be assessed. It applies this framework to two HSG that were key to the management of the euro crisis, the German chancellor Angela Merkel and the Greek Prime Minister Tsipras in their attempts to walk the tightrope between legitimate and decisive EU leadership.

The author analyzes EU’s response to the ongoing economic crisis, focusing on the problem of legislative and institutional fragmentation. She argues that the authoritarian crisis management – fueled by “crisis” discourse - subverted democratic accountability by its reliance on executive discretion and intergovernmentalism. Through an analysis of European Court of Justice’s case law as well as a close look at the exact workings and implications of European Central Bank’s ultra vires actions, she shows how Lisbon Treaty was sacrificed to the exigency of creating an Ersatz Union law more pliable to the immediate concerns of reforming the EMU. She holds that the intergovernmental instruments not only “unconstitutionally” requisitioned the involvement of EU institutions, but also established a political administration unresponsive to democratic accountability, damaging the legitimacy of the Union. The resulting subjugation of the political and social constitution to economic conditions threatens an abdication of law and undermines the integrity of the Union legal order.

This study investigates the depiction and complexity of actors in the print news coverage of the Euro Crisis between 2010 and 2012. Based on an empirical study of 40 newspapers from ten European countries, we examined the role and visibility of different types of actors. We also looked at two important assumptions from the political communication and the European studies’ literature: the trend towards the personalization of political news; and the relapse in Europeanization, which suggests that the Euro Crisis has contributed to further empower both the national governments over the European institutions and some countries over the others. Our main conclusions point to a personalized news coverage, mostly dominated by the views of national political leaders and economic actors. Finally, we discuss some of the reasons behind these features of the news coverage and their implications for the development of European integration and for the actual existence of a European public sphere., Cette contribution observe le traitement journalistique des acteurs visibles lors de la première phase de résolution de la crise de l’euro (entre 2010 et 2012). Elle repose sur une étude de quarante journaux pris dans dix pays européens. Pour ce faire, nous avons pris au sérieux deux affirmations des littératures en communication politique et en European Studies : d’une part, l’hypothèse de la personnalisation de l’écriture du politique et, de l’autre, celle d’un recul du processus d’européanisation, suggérant de facto que la crise de l’euro a contribué à accroitre le rôle et la place des gouvernements nationaux par rapport aux institutions communautaires et, certains pays plutôt que d’autres. Nos conclusions confirment ces hypothèses d’une couverture personnalisée des informations, dominées par les responsables politiques nationaux ainsi que par les experts économiques. Enfin nous abordons les raisons d’un tel cadrage de l’information et ses implications pour le processus d’intégration européenne, et en particulier pour l’absence d’un espace public européen.

This thesis aims to characterise and analyse the political strategies pursued by the EU institutions and the national governments of its member states in order to manage the so-called European sovereign debt crisis (2009-2013). By relying on a discursive perspective on policy analysis, it departs from the basic analytical assumption that the development of the crisis was constructed through meaning-making practices: the nature of a crisis is never simply determined by ‘objective’ dislocations, but rather, amid the radical uncertainty provoked by the economic downturn, some actors imposed onto others their diagnosis of ‘what had gone wrong’ and thus ‘what had to be done’. In the light of this perspective, four research questions guide the thesis: what were the main ideational underpinnings of the discursive construction of the euro crisis? Why did the ordoliberal construal of the crisis, at the centre of these underpinnings, become the dominant one at the EU level? How was the austerity-based management of the euro crisis legitimised despite the regressive, inefficient and unpopular consequences that this policy strategy implied? What have the main consequences been of the institutionalised discursive construction of the euro crisis for the economic governance of the European and Monetary Union? Overall, the research seeks to understand why the scale and depth of the Great Recession in the Eurozone was met with a commensurate revaluation of the pre-crisis modes of European integration. In order to answer these questions, the thesis first describes and problematises the main policies and institutional reforms adopted in the EU in response to the euro crisis. Secondly, it identifies the signifying practices that led to the construction of the European sovereign debt crisis as a problem of ‘wasteful Southern states’ that required the application of austerity and internal devaluation measures. And thirdly, it explores the constitution of competing discursive coalitions on the basis of rival rhetorical strategies and political projects. There are three main discursive strategies identified as key in providing the political conditions for possible austerity in the EU: the depoliticisation of economic – particularly budgetary – policy, the articulation of a discourse on social and economic development focused on the notion of competitiveness, and the deployment of anti-populist discourses in order to marginalise worries about fiscal consolidation programmes. The first three journal articles of the thesis – which is a compilation of articles, not a monograph – study each of these discursive articulations. The fourth departs slightly from the focus of the thesis; by relying on the policy learning approach, it analyses the development of the idea of austerity in the post-crisis context, and therefore studies the aftermath of the management of the euro crisis rather than its management as such.

[English] The book covers the changes in the European Union during the financial crisis 2010-2017. The author describes the EU's stabilization mechanisms: the European Financial Stabilization Mechanism (EFSM), the European Financial Stability Facility (EFSF) and the European Stabilization Mechanism (ESM). The author follows the application of the mechanisms against Greece, Ireland, Cyprus, Portugal and Spain. The negotiation ends with a proposal for the conceptual and legal integration of the mechanisms into the EU's economic policy coordination system. [German] Das Buch behandelt den Wandel der Europaischen Union wahrend der Finanzkrise 2010-2017. Der Autor beschreibt die Stabilisierungsmechanismen der EU: den Europaischen Finanzstabilisierungsmechanismus (EFSM), die Europaische Finanzstabilisierungsfazilitat (EFSF) und den Europaischen Stabilisierungsmechanismus (ESM). Der Autor verfolgt die Anwendung der Mechanismen gegenuber Griechenland, Irland, Zypern, Portugal und Spanien. Die Verhandlung wird mit einem Vorschlag der konzeptuellen und rechtlichen Integrierung der Mechanismen in das System der wirtschaftspolitischen Koordinierung der EU abgeschlossen.

UID/FIL/00183/2013 The European Union is facing multiple crises: the euro and sovereign debt crisis puts into question its economic and social cohesion as well as the rules of coexistence within the Economic and Monetary Union; the refugee crisis brought to the fore a high degree of disagreement among member states as to the duties of mutual solidarity and assistance; Brexit highlighted the need to continuously justify EU membership (Britain being the most evident, but not at all the only case in which public opinion sees membership with deep scepticism), and to address the social and economic roots of dissatisfaction with the EU – inasmuch as EU-internal, economically motivated migration has been one of the key issues of the ‘leave’ campaign; the security crisis put into question the Schengen agreement and the mutual trust between member states in security issues. The political conundrum currently challenging the EU calls for reflection on what went wrong with the process of European integration in the first place. The essay offers a possible diagnosis and traces a number of scenarios for the future development of the European Union. published

RESUMENLa cooperación financiera regional (cfr) busca asegurar liquidez a los bancos centrales, construir y mantener el riesgo regional relativamente homogéneo. Un aspecto de la cfr son los requisitos fiscales para asegurar la estabilidad y homogeneidad de precios de los países miembros. La unidad de cuentas regional requiere de un fondo de estabilización y de un fondo de rescate de la deuda para asegurar los spreads. El presente trabajo revisa las lecciones para América Latina del funcionamiento de la cfr en Europa antes y durante la crisis del euro.AbstractRegional financial cooperation (rfc) aims to secure the liquidity of central banks and build and maintain regional risk to be relatively homogenous. One aspect of rfc consists of the fiscal requirements to guarantee price stability and homogeneity among member countries. The regional accounts unit requires a stabilization fund and a debt bailout fund in order to ensure the spreads. This paper provides an overview of lessons for Latin America based on how rfc has worked in Europe, both before and throughout the euro crisis.

Van Vossole's article explores the racist framing of the peripheral member states of the European Union, the PIGS (Portugal, Ireland (and/or Italy), Greece and Spain). It demonstrates a strong connection between the processes of racialization and depoliticization, as well as the return of colonial dynamics in the Eurozone. Side-stepping political economy and history, the culturalization of politics perfectly complements the ‘post-political’ neoliberal hegemony. Political and media discourses reproduce it in both populist and corporate interests. The culturalization of politics reduces the differences between centre and periphery to certain ‘cultural characteristics and habits’, as reflected in stereotypes of laziness, non-productivity, corruption, wasteful spending and lying. These make it possible to blame the PIGS for the current crisis, legitimizing drastic austerity measures and a loss of sovereignty. The loss of sovereignty shows remarkable similarities with what Kwame Nkrumah defined as neoc...

When countries face balance-of-payments crises, their policy responses vary widely. This article argues that the choice between the two main options of internal adjustment (i.e., austerity and structural reforms) and external adjustment (i.e., exchange-rate devaluation) depends on how costly each of these strategies is for a country overall. Although the choice of adjustment strategy is thus structurally determined, the level of political conflict associated with crisis management depends on both the national vulnerability profile and partisan interests. Moreover, irrespective of the adjustment strategy, all governments design the specific reforms in ways that shelter their own voters. Empirically, this article uses qualitative case studies and survey data to examine the significant variation in crisis responses, crisis politics, and distributive outcomes of the 2008-2010 global financial crisis in eight Eastern European countries. The article concludes with a discussion of the implications of the Eastern European experience for crisis politics in the Eurozone crisis.

We study a sovereign debt crisis in a small member state of a currency union. If the country exits the currency union, it may redenominate its liabilities and reduce the real value of debt through depreciation and inflation. We analyze formally how the anticipation of this possibility, “exit expectations”, impact the dynamics of the sovereign debt crisis. First, we show that public debt accumulates faster and sovereign yields increase more strongly because of redenomination risk. Second, we find that exit expectations induce public debt to be stagflationary. Last, we analyze Greek time-series data through the lens of our model and quantify the contribution of exit expectations to the Greek crisis.

Until very recently, European employers and political leaders denied the need for any coordination in industrial relations at EU level. In 2011 however, the European Parliament and the Council adopted a new European economic governance regime that makes EU member states labor policies subject to multilateral surveillance procedures. This paper analyzes this 'silent revolution' from above and assesses organized labor's responses to this challenge. It shows that the EU's new governance regime does not follow the classical model of a federal state, but rather the governance structures of multinational corporations that control their local subsidiaries through the use of whipsawing tactics and coercive comparisons. European trade unions and social movements difficulties in politicizing European economic governance are thus best explained by the ability of the new supranational EU regime to nationalize social conflicts.

This introductory article to the special issue proposes a more encompassing view of transnational collective action in Europe, which goes beyond the classical, country-by-country oriented, comparative industrial relations approach. Instead, we propose an extension of focus to capture also other actors, action repertoires, places and levels. Specifically, we introduce and integrate the contributions to this issue, by extending our analytical perspectives from traditional forms of employment to precarious and posted workers; from national and European trade union structures to informal groups of workers and social movements; from unions’ traditional strongholds in manufacturing multinationals to workers in the meat industry, health care or occupied factories; from national unions seen as coherent units to a perspective that emphasizes their internal contradictions; from the analysis of discrete actions to historically more encompassing perspectives; and from utilitarian views on collective action to a larger perspective that assesses the analysis of the importance of collective struggles for the making and unmaking of a new European working class. Norwegian Academy of Science and Letters

This paper provides an overview of Ireland’s macroeconomic performance over the past decade. In addition, to presenting the underlying facts about the boom, bust and (currently limited) recovery, the paper also discusses some common fallacies and misrepresentations of economic events in Ireland. The paper concludes with some broader lessons from the Irish experience for Eurozone economic policy and some observations on the role that EMU and the ECB have played in Ireland’s crisis.

The fundamental idea we discuss in this paper is that the failure of Europe to deal with the international crisis is due, first and foremost, to the deepening of a more specific crisis that affected the very process of European integration and developed through two main channels: one, broader, linked to the erosion of the original driving forces underpinning integration in Europe; another, more circumscribed, linked to the malfunctioning of the euro as an internal adjustment mechanism of the currency zone. To deal with these structural dimensions of the crisis, we put forward a model of a Global Europe against the model of Continental Europe that has dominated the integration process until now and in this alternative framework we discuss the potential role of Portugal and of the Community of Portuguese Speaking Countries.

Als im Jahr 1973 das internationale Währungssystem von Bretton Woods zusammenbrach, stand die D-Mark als stabile Währung weltweit an der Spitze ihres Ansehens. Der Dollar unterlag einem permanenten unter Abwertungsdruck, weil die amerikanische Federal Reserve über Jahre das USHaushaltsdefizit über die Notenpresse gedeckt und die Währung so ruiniert hatte. Im Glanze ihrer Ära und ohne Not ließ sich die deutsche Bundesregierung in das Projekt der Gemeinschaftswährung hineinziehen. Dabei leuchtete von Anfang an durch, dass ihre wichtigsten Partner mit der Gemeinschaftswährung nicht die Effizienz der Europäischen Union verbessern, sondern ihre Staatsschulden vergemeinschaften wollten. Als der Euro 1999 eingeführt wurde, schien erst alles gut. Als aber die Finanzmärkte den wahren Umfang der Staatsverschuldung der Peripheriestaaten erkannten, kam es zur Krise. Eine Finanzspritze folgte der anderen. Ohne Erfolg. Die gegenwärtige Politik ist ohne Perspektive. Weitere Finanzspritzen können nicht mehr helfen. Eine Alternative ist erforderlich. When the international monetary system of Bretton Woods collapsed in 1973 the Deutsche Mark was at the top of its international reputation. The Dollar was permanently weak because the FED financed the US budget deficit for many years over the money printing press. In the European Union the German Federal Government conceded to step into the adventure of a common currency though it was already clear that the important partner governments were not interested to improve the efficiency of the European Union, but to shift their budget deficits to the Union. When the euro eventually came in 1999 it succeeded until the financial markets understood the full truth of its construction. Now it is difficult to get out of the crisis. A new start is required.

Die beiden zentralen Ursachen der Euro-Krise liegen in einem fehlenden Ausgleichsmechanismus zur Absorption asymmetrischer Schocks und in immanenten Fehlanreizen (moral hazard) infolge externer Kosten eines systemischen Zusammenbruchs der Eurozone. Die bisherigen Antworten der Politik vermochten die Euro-Krise bislang nicht zu beenden. Der vorliegende Artikel untersucht aus spieltheoretischer Sicht die Bedingungen für ein institutionelles Design, für das ein nichtoptimaler Währungsraum dauerhaft stabilisiert werden kann. Es zeigt sich, dass die Eurozone dafür einen Umverteilungsmechanismus und gleichzeitig eine Ausschlussoption oder ein zentrales Eingriffsrecht benötigt. Das institutionelle Design muss das "Spiel" so verändern, dass die Durchsetzung von Stabilisierungsmaßnahmen teilspielperfekt und somit glaubwürdig wird. The causes for the Euro crisis are lying in a missing adjustment mechanism in order to absorb asymmetric shocks and in adverse incentives (moral hazard) due to external costs stemming from systemic risks of a break-up of the eurozone. Until now Europe's politicians have failed to respond to the crisis in a way to find a solution. This analysis sets out game-theoretical requirements for an institutional design that is able to permanently stabilize a non-optimal currency area. It is shown that an adjustment mechanism and, in addition, an exit option or a supranational fiscal policy institution are required fill the institutional gap that still exists in the eurozone. An adequate institutional design must change the "game" in order to make a stability union a sub-game perfect equilibrium and hence a credible solution.

The crisis of the euro area has severely tested the political authority of the European Union (EU). The crisis raises questions of normative legitimacy both because the EU is a normative order and because the construction of economic and monetary union (EMU) rested upon a theory that stressed the normative value of the depoliticization of money. However, this theory neglected the normative logic of the two-level game implicit in EMU. It also neglected the need for an impartial and publically acceptable constitutional order to acknowledge reasonable disagreements. By contrast, we contend that any reconstruction of the EU's economic constitution has to pay attention to reconciling a European monetary order with the legitimacy of member state governance. The EU requires a two-level contract to meet this standard. Member states must treat each other as equals and be representative of and accountable to their citizens on an equitable basis. These criteria entail that the EU's political legitimacy requires a form of demoicracy that we call ‘republican intergovernmentalism’. Only rules that could be acceptable as the product of a political constitution among the peoples of Europe can ultimately meet the required standards of political legitimacy. Such a political constitution could be brought about through empowering national parliaments in EU decision-making.

Greater financial integration between core and peripheral European Monetary Union (EMU) members not only had an effect on both sets of countries but also spilled over beyond the euro area. Lower interest rates allowed peripheral countries to run bigger deficits, which inflated their economies by allowing credit booms. Core EMU countries took on extra foreign leverage to expose themselves to the peripherals. We present a stylized model that illustrates possible mechanisms for these developments. We then analyze the geography of international debt flows using multiple data sources and provide evidence that after the euro’s introduction, core EMU countries increased their borrowing from outside of the EMU and their lending to the EMU periphery. Moreover, we present evidence that large core EMU banks’ lending to periphery borrowers was linked to their borrowing from outside of the euro area.

The paper analyses how the IMF brought its experience gained in emerging market sovereign debt crises in the troika’s handling of the euro crisis. We link models of multiple equilibria with the IMF’s experience made in Latin American crises in the 2000s. We examine subsequent changes in the IMF’s policy guidelines and show that previous insights have been taken in, but applied only with a significant delay and partially against institutional rules and internal advice for the case of Greece. Hence, we argue that the inclusion of the IMF in Europe’s crisis fighting did not completely deliver what had been hoped for.

Ten years after its introduction, the Euro is in an existential crisis. The crisis is the outcome of economic policies that have aimed at labour market flexibility and financial integration. This paper argues, firstly, that the aggregate demand regime in the Euro area is wage led. While an increase in wages (other things equal) does have a negative effect on investment and on net exports, it does have a positive effect on consumption. As the Euro area is a relatively closed economy, the consumption effect overpowers the investment effect and the export effect. Secondly, we argue that in the Euro area two growth models have emerged: a credit-led and an export-led model. These have given rise to the imbalances that are at the heart of the Euro crisis. Wage flexibility has proven insufficient to prevent these imbalances. Thirdly, we advocate a system of coordinated wage bargaining that aims at wages rising in line with productivity growth and a substantially upward-revised inflation target. If the project of European economic integration is to survive, it needs a drastic change in direction. An important building block of this redirection is a rethinking of the role of wage policy.

Proponents of Asian monetary integration have always looked to Europe for inspiration. This paper reconsiders the cas in light of the eurozone crisis. I ask what aspects of the earlier consensus remain intact in the wake of the crisis and what aspects must now be rethought. Is there a danger of “throwing out the baby with the bathwater” – a danger, in other words, that Europe’s negative experience since 2009 will cause Asia to turn away too quickly and completely from monetary integration? Or is it in fact appropriate to “throw out the baby” – to conclude in light of Europe’s example that Asian monetary integration is not an appropriate and desirable goal?

The robustness of the EU’s constitutional framework – and its ability to accommodate democratic politics – is challenged as never before. The growing disconnect between formally democratic procedures and substantive choice is well illustrated by the Greek crisis. Since its first bailout in May 2010, Greece has held four general elections and a referendum. Yet, the anti-austerity preferences of the Greek electorate have not been effectively translated into policy. This article uses the Greek crisis to analyse the EU’s democratic deficit, and the related issue of the locus of legal and political sovereignty in the EU. It argues that the EU’s constitutional framework is not sufficiently responsive to changing material conditions or to the changing preferences of Europeans. Thus, EU constitutionalism needs to be refashioned in order to strike a better balance between democratic and technocratic governance, as well as between the needs of individual citizens, national citizenries, and states.

The euro crisis remains unresolved and the euro currency union incomplete and extraordinarily vulnerable. The euro regime's essential flaw and ultimate source of vulnerability is the decoupling of central bank and treasury institutions in the euro currency union. We propose a Euro Treasury scheme to properly fix the regime and resolve the euro crisis. The Euro Treasury Plan would establish a rudimentary fiscal union that is not a transfer union. The core idea is to create a Euro Treasury as a vehicle to pool future eurozone public investment spending and have it funded by proper eurozone treasury securities. The Euro Treasury could fulfil a number of additional purposes while operating mainly on the basis of a strict rule. The plan would also provide a much-needed fiscal boost to recovery and foster a more benign intra-area rebalancing.

Wat bedoelt EU voorzitter Juncker precies met de 'Angelsaksische wereld' waar hij bang voor is?

Wat bedoelt EU voorzitter Juncker precies met de 'Angelsaksische wereld' waar hij bang voor is?

During the European sovereign debt crisis, most countries that ran into fiscal trouble had Catholic majorities, whereas countries with Protestant majorities were able to avoid fiscal problems. We find that Christian‐conservative members of the German parliament from constituencies with higher shares of Protestants were more likely to vote against a third bailout for Greece. Survey data show that views on the euro differ between German Protestants and non‐Protestants at the individual level, too. Among Protestants, concerns about the euro have, compared to non‐Protestants, increased during the crisis. We show that this increase in concern is linked to a reduction of Protestants' subjective well‐being. We use the timing of survey interviews and news events in 2011 to account for the endogeneity of euro concerns. Emphasis on moral hazard concerns in Protestant theology may, thus, still shape economic preferences. published

We develop a mathematical programing approach in order to measure the arbitrage size in bond markets. Transaction costs may be incorporated. The obtained arbitrage measures have two interesting interpretations: On the one hand they provide the highest available arbitrage profit with respect to the price of the sold (bought) securities. On the other hand they give the minimum relative (per dollar) bid (ask) price modification leading to an arbitrage free market. Moreover, some primal problems lead to optimal arbitrage strategies (if available), while their dual problems generate proxies for the Term Structure of Interest Rates. The developed methodology permits us to implement an empirical test in the Euro-zone during the Euro crisis. Classical literature justifies the relevance of empirical analyses verifying the degree of efficiency during market turmoils. Our empirical study of the German, French and Spanish sovereign bonds markets finds that the main arbitrage opportunities come from the price differences between maturity-matched strips or "On-The-Run Premium" for zero-coupon bonds. When we remove the strips and the zero-coupon bonds the arbitrage still exists in the Spanish market.

The essay proposes some reflections upon the figure of the “guest”, a figure that Davide Tarizzo’s theoretical contribution tries to define in order to open a space that could conserve political subjectivity, however weak, for Europe and its institutional structures. Tarizzo seems to be proposing the theme of European hospitality as a political invention to be activated in order to contain the repercussions of the inevitable end of the single currency. The idea is, in general, appreciated and supported in this paper, with the conviction that it follows the main course of the construction of the European Union and that it contains a reason of erosion of the political weight of the single national subjectivities. However, there is reason to doubt that the proposal of defining the juridical profile of the European guest – as separated from national citizenship – is to be linked to the post-euro scenario. In other words, the doubt is that, if this scenario should occur, the proposal could not eventually be put de facto into practice. Il saggio propone qualche riflessione intorno alla figura che il contributo teorico di Davide Tarizzo prova a definire, per aprire uno spazio che possa conservare all’Europa e alla sua trama istituzionale una soggettività politica, per quanto debole: quella dell’ospite. Tarizzo sembra però proporre il tema dell’ospitalità europea come invenzione politica da attivare per parare i contraccolpi dell’inevitabile fine della moneta unica. Nel saggio, si apprezza in generale l’idea e la si sostiene, nella convinzione che essa si collochi lungo la linea principale della costruzione comunitaria, e che contenga un motivo di erosione del peso politico delle soggettività nazionali, ma si avanza un motivo di dubbio: che la proposta di definire il profilo giuridico dell’ospite europeo –in quanto distinto dalla cittadinanza nazionale– debba essere legata allo scenario post-euro. Il dubbio cioè che, qualora questo scenario si verificasse, la proposta possa poi essere effettivamente percorsa.

Entering a currency union without any political union European countries have taken a gamble: will the needs of the currency union force a political integration (as anticipated by Monnet) or will the tensions create a backlash, as suggested by Kaldor, Friedman and many others? We try to answer this question by analyzing the cross sectional and time series variation in pro-European sentiments in the EU 15 countries. The 1992 Maastricht Treaty seems to have reduced the pro-Europe sentiment as does the 2010 Eurozone crisis. Yet, in spite of the worst recession in recent history, the Europeans still support the common currency. Europe seems trapped: there is no desire to go backward, no interest in going forward, but it is economically unsustainable to stay still.

Greater financial integration between core and peripheral EMU members had an effect on both sets of countries. Lower interest rates allowed peripheral countries to run bigger deficits, which inflated their economies by allowing credit booms. Core EMU countries took on extra foreign leverage to expose themselves to the peripherals. The result has been asset-price bubbles and collapses in some of the peripheral countries, area-wide banking crisis, and sovereign debt problems. We analyze the geography of international debt flows using multiple data sources and provide evidence that after the euro's introduction, Core EMU countries increased their borrowing from outside of EMU and their lending to the EMU periphery.