This chapter examines the position of the European Union in the global political economy (GPE). It also considers key dimensions of change and development as well as the EU's impact on the operation of the contemporary GPE. To this end, the chapter discusses central ideas in international political economy and relates these to the growth of the EU. Furthermore, it analyses the EU's role in the GPE in three areas: European integration, the EU's engagement in the GPE, and the EU's claims to be a major economic power. It concludes with an assessment of global economic governance, focusing in particular on the EU's role in the financial, economic, and sovereign debt crises.
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Book
Edited by Michelle Cini and Nieves Pérez-Solórzano Borragán
European Union Politics equips readers to understand the European Union and the topical debates and issues which surround it. Alongside comprehensive coverage of the history, theory, institutions, and policies of the EU, it features chapters on contemporary issues and current debates, including democracy and legitimacy in the EU, citizens and public opinion, the economic crisis, and a new chapter on Brexit. Helpful learning features throughout the text, including key points, questions, and examples, support learning.
Book
Edited by Michelle Cini and Nieves Pérez-Solórzano Borragán
European Union Politics is the most complete and issues-led introductory textbook on the European Union. Alongside rigorous coverage of the theory, institutions, and policies of the EU, the book engages with contemporary debates, and current crises. The seventh edition has been substantially updated, with significantly revised chapters on Brexit and the CJEU, as well as two new chapters covering the EU response to the COVID-19 pandemic, and the European migration and refugee crisis. The text’s accessible writing style makes it the ideal starting point for anyone wishing to fully understand the workings of this complex and ever-evolving system. Throughout the book, students are supported by helpful learning features, including key points, questions, and examples.
Chapter
Dermot Hodson and Uwe Puetter
This chapter discusses the European Union’s (EU) response to the euro crisis that emerged in late 2009, two years after the global financial crisis struck. It identifies the challenges this crisis has posed to the existing institutional set-up of economic and monetary union (EMU) and shows that it had a lasting impact on dicussions over the EU’s future well beyond its most dramatic moments. A timeline of the euro crisis is provided and the main changes to the institutional framework of European economic governance at the time of writing are reviewed. The chapter considers whether the crisis was caused by a deficit of centralized decision-making and whether it has served, in turn, as a catalyst for deeper economic and political integration in the euro area and the Union more generally. The consequences of the crisis for the EU’s legitimacy are also explored from competing theoretical perspectives.
Chapter
Dermot Hodson and Uwe Puetter
This chapter discusses the European Union’s (EU) response to the euro crisis that emerged in late 2009, two years after the global financial crisis struck. It identifies the challenges this crisis has posed to the existing institutional set-up of economic and monetary union (EMU) and shows that it had a lasting impact on discussions over the EU’s future well beyond its most dramatic moments. A timeline of the euro crisis is provided and the main changes to the institutional framework of European economic governance at the time of writing are reviewed. The chapter considers whether the crisis was caused by a deficit of centralized decision-making and whether it has served, in turn, as a catalyst for deeper economic and political integration in the euro area and the Union more generally. The consequences of the crisis for the EU’s legitimacy are also explored from competing theoretical perspectives.
Chapter
Amy Verdun
This chapter provides an introduction to economic and monetary union (EMU). It describes the key components of EMU and what happens when countries join. EMU was the result of decades of collaboration and learning, which have been subdivided here into three periods: 1969–91, taking us from the European Council’s first agreement to set up EMU to Maastricht, when the European Council included EMU in the Treaty on European Union (TEU); 1992–2002, from when plans for EMU were being developed to the irrevocable fixing of exchange rates; and 2002 onwards, once EMU had been established, and euro banknotes and coins were circulating in member states. Next, the chapter reviews various theoretical explanations, both economic and political, accounting for why EMU was created and looks at some criticisms of EMU. Finally, the chapter discusses how EMU has fared under the global financial crisis and the sovereign debt crisis. These crises brought to the fore various imperfections in the design of EMU. This section discusses what changes have been made since 2009 to address those flaws and at what we may expect in the years to come.
Chapter
Amy Verdun
This chapter introduces economic and monetary union (EMU), describingthe key components of EMU and what happens when countries join. EMU was the result of decades of collaboration and learning, divided here into three periods: 1969–91, from the agreement to creation to its inclusion in the Treaty on European Union (TEU); 1992–2002, from having the plans for EMU to the irrevocable fixing of exchange rates; and 2002 onwards, with EMU established and euro banknotes and coins circulating in member states. The chapter reviews various theoretical explanations, both economic and political, for the creation of EMU and considers some criticisms of EMU. The chapter discusses how EMU has fared under the global financial crisis, the sovereign debt crisis, and the COVID-19 pandemic. These crises highlighted various imperfections in the design of EMU and provided opportunities for further development. This chapter discusses changes made since 2009 to address those flaws and what may be yet to come.
Chapter
Peter Gowan and Doug Stokes
This chapter examines some of the central debates on how we should understand the United States’ efforts to reshape international economic relations since the 1940s. It first considers debates on the sources and mechanisms of American economic strategy before turning to debates about the substance of American efforts to shape the global economy. It approaches the debates about the substance of U.S. foreign economic policy since 1945 by classifying varying perspectives on this question in three alternative images. The first such image is that of America as the promoter of a cooperative, multilateral order in international economics. The second image is that of an American economic nationalism and the third is that of an American empire. The chapter goes on to analyse the global financial crisis and concludes with an overview of some of the main current debates about the strength of American capitalism in the world economy.
Chapter
This chapter examines the various attempts to create the economic and monetary union (EMU), which first became an official objective of the European Community (EC) in 1969 but was achieved only thirty years later. The chapter first provides a historical background on efforts to create the EMU, including long-standing debates between France and West Germany on its design, before discussing the launch of the single currency, the euro, and its subsequent progress up to and including the eurozone crisis in the late 2000s. On the eurozone crisis, it considers both the short-term efforts at crisis management and the long-term reforms that were implemented in an attempt to prevent further crises. Finally, it considers some of the explanations for and critiques of EMU, including critiques of the responses to the eurozone crisis that have been offered by various academic commentators.
Chapter
Vivien A. Schmidt
This chapter examines the impact of Europeanization upon the national economies of European Union member states. It considers how successful the EU has been in promoting its goal of building a single European economy out of the diverse national economies of its member states; how much convergence has occurred among EU member states, and how much divergence remains; and what impact the economic crisis beginning in 2008 has had on the EU and its member states. To answer these questions, the chapter traces the development of Europe’s national economies from the post-war period until today. It also analyses the impact of globalization and Europeanization on post-war varieties of capitalism before concluding with reflections on future patterns of political economic development in the EU in light of the economic crisis.
Chapter
This chapter examines the field of political economy from a historical, comparative, and international perspective, focusing on how ideas, practices, and institutions develop and interact over place and time. It first provides an overview of political economy as a field of study before discussing some important theories such as Marxism, liberalism, and economic nationalism. It then considers key issues such as the interaction of states and markets and the North–South divide, along with Karl Marx's critique of international political economy (IPE). It also explores the post-war international economic order and the twin phenomena of globalization and regionalization in the post-Cold War era before concluding with an analysis of the ‘boom and bust’ episodes in the global capitalist economy such as the global financial crisis of 2008.
Chapter
John Ravenhill
This chapter provides an overview of the current state of the world economy. The contemporary international economic system is more closely integrated than in any previous era. The global financial crisis and its aftermath provide a clear illustration of the relationship between trade, finance, international institutions, and the difficulties that governments face in coping with the problems generated by complex interdependence. The chapter then traces how the world economy evolved to reach its present state. Before 1945, the spectacular increase in economic integration that had occurred over the previous century was not accompanied by institutionalized governmental collaboration on economic matters. The end of the Second World War marked a significant disjunction: global economic institutions were created, the transnational corporation emerged as a major actor in international economic relations, and patterns of international trade began to change markedly from the traditional North–South exchange of manufactures for raw materials. Since the emergence of global political economy (GPE) as a major subfield of the study of international relations in the early 1970s, GPE scholars have generated an enormous literature that has employed a wide variety of theories and methods. Most introductions to the study of GPE have divided the theoretical approaches to the subject into three categories: liberalism, nationalism, and Marxism.
Chapter
Colin Hay
This chapter discusses globalization's impact on states. There is no topic more controversial in the field of global political economy than the impact of globalization on the accountability, autonomy, capacity, and sovereignty of the nation state; and the controversy has only intensified since the onset of the global financial crisis. Arguably, the democratic character of governance in contemporary societies is at stake in such debates. The chapter reviews the extensive controversy that surrounds such questions, focusing attention on the principal mechanisms in and through which globalization is seen to impact upon the nation state and the empirical evidence that might either substantiate or question the existence of such mechanisms. It also provides a detailed assessment of the case for and against the globalization thesis, examining the extent to which global economic integration might be seen to restrict the parameters of domestic political autonomy. Moreover, the chapter differentiates between the politics of globalization and the globalization of politics. It concludes by considering the complex and sometimes paradoxical relationship between globalization, democracy, and the nation state.
Chapter
Yvonne Galligan
This chapter analyses theories of European integration through a gender lens. It points to the diversity of perspectives in gender scholarship on European integration, and draws on these different points of view to examine other theoretical approaches. It assumes that gender is a basic organising principle of the social world, and therefore is an integral aspect of European integration. The chapter discusses gender theory and its contribution to the study of European integration. It then goes on to interrogate other European integration theories - liberal intergovernmentalism, neofunctionalism, and social constructivism – examining the nature of gendered power that they emphasize and evaluating the extent to which they are open to incorporating a gender-informed perspective. The chapter then analyses the integrationist effect of the European economic crisis on gender equality. This discussion reveals the marginalization of gender equality, and gender mainstreaming, as the neo-liberal response to the economic crisis created new gender inequalities and perpetuated old patterns of gender hierarchy.
Chapter
Nana K. Poku and Jacqueline Therkelsen
This chapter explores the interrelationships between globalization, development, and security. It shows how globalization, as a neoliberal ideology for development promoted by key international financial institutions, deepens inequality between and within nations on a global scale. This exacerbates global insecurity through a growing sense of injustice and grievance that may lead to rebellion and radicalization. The chapter first considers the neoliberalism of globalization before presenting the case for conceptualizing globalization as a neoliberal ideology for development. It then discusses the legacy of structural adjustment programmes and the harmful effects of neoliberal ideology on societies, particularly across the developing world. Finally, it looks at two case studies to illustrate the link between uneven globalization and global insecurity: the Egypt uprising of 2011 and the Greek economic crisis of 2010.
Chapter
12. Litmus Tests for European Integration Theories
Explaining Crises and Travelling beyond Europe
Tanja A. Börzel and Thomas Risse
This chapter deals with two litmus tests for theories of European integration. The first part asks, how and to what extent various approaches can explain the contemporary crises of European integration. It thereby tackles the question of whether European integration theories might have biased EU scholars towards ignoring evidence for (dis-)integration. While being more optimistic about the state of the Union than many EU scholars are, the authors of this chapter argue for a more differentiated conceptualization of integration as a continuous variable that takes disintegration, rather than stagnation or no integration, as the opposite value of integration. The second part of the chapter examines to what extent European integration theories are able to shed light on experiences with regionalism across the globe. It argues that they do provide plausible accounts for the emergence of regionalism around the world. Comparing regions points to important scope conditions under which European integration theories operate. When it comes to outcomes, however, they need to be complemented by explanations emphasizing diffusion to clarify why and when states are more inclined to pool and delegate sovereignty in some regions than in others.
Chapter
This chapter examines the shift in global balance that began in the post-2007 economic crisis. For a considerable time before the 2008 crisis, the United States and most European states had been living on high levels of debt both national and individual, public and private. Manufacturing in the developed West, and its provision of secure jobs for many workers, was undermined by the new economic environment of globalization, as well as the growth of cheaper manufacturing in China and the other BRIC countries. A new epoch of financial capitalism, which had emerged since the 1980s, was in full swing by the start of the Noughties. The chapter first considers the post-2007 economic crisis, before discussing the continuing rise of China and Russian foreign policy under Vladimir Putin. It concludes with an assessment of international reactions to China’s rise, including those of East Asia, international organizations, and Taiwan.
Chapter
Nana K. Poku and Jacqueline Therkelsen
This chapter proposes that globalization is a neoliberal ideology for development, consolidated and promoted by key international financial institutions (the World Bank and the International Monetary Fund), which deepens inequality between and within nations on a global scale, resulting in increased global insecurity through a growing sense of injustice and grievance that may lead to rebellion and radicalization. It is argued that, ultimately, the globalization ideology for development services the interest of its advocates, the elites of the core capitalist economies that dominate the international financial institutions, at the expense and immiseration of the majority of people in developing economies and the weaker segments of their own societies. The chapter is set out in three stages: first, it presents the case for conceptualizing globalization as a neoliberal ideology for development; second, it provides evidence to demonstrate the harmful effects of the ideology on societies, particularly across the developing world; and third, it explores the connection between uneven globalization and global insecurity through two case studies: the uprising in Egypt in 2011, and the collapse of the Greek economy in 2010.
Chapter
Tanja A. Börzel
After twenty years of continuous deepening and widening, European integration has entered an era of recurrent crises. Most students of the European Union (EU) seem to agree that the constitutional equilibrium between intergovernmental and supranational institutions has changed. Some see ‘new intergovernmentalism’ and ‘integration without supranationalization’ prevailing. Others contend that we are witnessing a series of functional and institutional spillovers empowering supranational institutions. This chapter argues that governance approaches are particularly useful to address the puzzling counter-positions represented in the current debate about the ‘nature of the beast’. They are better equipped to explore how and to what end institutional structures and processes have responded to the crises than mainstream integration theories. The chapter starts with introducing the ‘governance turn’ in EU studies as the attempt of EU scholars in the early 1990s to capture the nature of the EU. It then presents a typology that is based on a broad concept of governance as institutionalized forms of political coordination. The empirical part of the chapter uses this typology to give an overview of the structures and processes of EU governance before applying it to the financial and the migration crises. The chapter concludes with a discussion of the major challenges for European integration (theories) from a governance perspective, particularly with regard to managing current and preventing future crises.
Chapter
Stijn Smismans
This chapter discusses the extent to which decision-making in the European Union can be considered democratic and legitimate. The chapter clarifies the concepts ‘democracy’ and ‘legitimacy’, and describes how, although initially the legitimacy of the European polity was not perceived as a problem, it became more problematic as the EU gained more competences. The European democratic deficit became an important issue of debate only during the 1990s after the Maastricht Treaty had transferred considerable powers to the EU. The main solution to the democratic deficit has been inspired by the parliamentary model of democracy and involves strengthening the European Parliament (EP), while also paying attention to the role of national parliaments and regional and local authorities. The chapter also shows how the governance debate at the start of the twenty-first century broadened the conceptual understanding of democracy in the EU by addressing the complexity of European governance (see also Chapter 7). By looking at different stages of policy-making and different modes of governance, while dealing with issues such as transparency and the role of civil society, the chapter discusses a wider range of issues associated with the democracy and legitimacy of the Union. It assesses the impact on EU democracy of the Constitutional Treaty and the Lisbon Treaty. The chapter concludes by warning that three main crises, namely the economic, migration, and security crises, have revived nationalist and populist movements exacerbating the challenges to the EU’s legitimacy.
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