Economic and social policies under EMU

Ricardo Pinheiro Alves ()
Additional contact information
Ricardo Pinheiro Alves: Universidade Lusíada and Research Office of the Portuguese Ministry of the Economy
Authors registered in the RePEc Author Service: Ricardo Pinheiro-Alves

No 156, GEE Papers from Gabinete de Estratégia e Estudos, Ministério da Economia

Abstract: The coordination of economic policies is seen as a requirement of EMU, although there is no strong economic rationale for it. After the 2008-2010 crises a complex surveillance mechanism was implemented where the European Semester had the role to coordinate economic and social policies in order to obtain real convergence between countries and prevent further instability. However, it has been ineffective in helping Southern countries to converge, deepening existing divisions and threatening further exits after the UK. This ineffectiveness and a democratically flawed decision-making process ask for a change in the framework of policy coordination. The proposed solution mixes an idle approach based on fiscal transfers with an engaged one where coordination over significant spillover effects between countries and cooperation based on Pareto improvements are the rules. It reinvigorates the governance of the single market, focuses on the spatial distribution of economic activity and it is a decentralized answer to the common threat of division. Moreover, it complies with the two core ideas of the EU project: democracy, from which peace depends, and development within a market economy where countries are free to choose their way of development.

Keywords: EMU; European Semester; Policy coordination; Efficiency; Cohesion (search for similar items in EconPapers)
Pages: 28 pages
Date: 2020-08, Revised 2020-08
References: Add references at CitEc
Citations:

Published

Downloads: (external link)
https://www.gee.gov.pt//RePEc/WorkingPapers/GEE_PAPERS_156.pdf First version, 2020 (application/pdf)

Related works:
This item may be available elsewhere in EconPapers: Search for items with the same title.

Export reference: BibTeX RIS (EndNote, ProCite, RefMan) HTML/Text

Persistent link: https://EconPapers.repec.org/RePEc:mde:wpaper:0156

Access Statistics for this paper

More papers in GEE Papers from Gabinete de Estratégia e Estudos, Ministério da Economia Contact information at EDIRC.
Bibliographic data for series maintained by Joana Almodovar ().