Monetary Union, Fiscal Crisis and the Preemption of Democracy
AbstractThe European Monetary Union (EMU) has removed crucial instruments of macroeconomic management from the control of democratically accountable governments. Worse yet, it has been the systemic cause of destabilizing macroeconomic imbalances that member states found difficult or impossible to counteract with their remaining policy instruments. And even though the international financial crisis had its origins outside Europe, the Monetary Union has greatly increased the vulnerability of some member states to its repercussions. Its effects have undermined the economic and fiscal viability of some EMU member states, and they have frustrated political demands and expectations to an extent that may yet transform the economic crisis into a crisis of democratic legitimacy. Moreover, present efforts of EMU governments to “rescue the Euro” will do little to correct economic imbalances and vulnerabilities, but are likely to deepen economic problems and political alienation in both, the rescued and the rescuing polities.
Download InfoIf you experience problems downloading a file, check if you have the proper application to view it first. In case of further problems read the IDEAS help page. Note that these files are not on the IDEAS site. Please be patient as the files may be large.
Bibliographic InfoPaper provided by European Institute, LSE in its series LEQS – LSE 'Europe in Question' Discussion Paper Series with number 36.
Date of creation: May 2011
Date of revision:
This paper has been announced in the following NEP Reports:
- NEP-ALL-2011-07-02 (All new papers)
- NEP-CBA-2011-07-02 (Central Banking)
- NEP-EEC-2011-07-02 (European Economics)
- NEP-MAC-2011-07-02 (Macroeconomics)
- NEP-MON-2011-07-02 (Monetary Economics)
Please report citation or reference errors to , or , if you are the registered author of the cited work, log in to your RePEc Author Service profile, click on "citations" and make appropriate adjustments.:
- von Hayek, Friedrich August, 1974.
"The Pretence of Knowledge,"
Nobel Prize in Economics documents
1974-2, Nobel Prize Committee.
- Lars Jonung & Eoin Drea, 2010. "It Can't Happen, It's a Bad Idea, It Won't Last: U.S. Economists on the EMU and the Euro, 1989-2002," Econ Journal Watch, Econ Journal Watch, vol. 7(1), pages 4-52, January.
- Dyson, Kenneth & Featherstone, Kevin, 1999. "The Road To Maastricht: Negotiating Economic and Monetary Union," OUP Catalogue, Oxford University Press, number 9780198296386.
- Johnson, Harry G, 1971. "The Keynesian Revolution and the Monetarist Counter-Revolution," American Economic Review, American Economic Association, vol. 61(2), pages 1-14, May.
- Otmar Issing, 2002. "On Macroeconomic Policy Co-ordination in EMU," Journal of Common Market Studies, Wiley Blackwell, vol. 40(2), pages 345-358, 06.
- George Selgin, 2010. "The Secret of the Euro's Success," Econ Journal Watch, Econ Journal Watch, vol. 7(1), pages 78-81, January.
For technical questions regarding this item, or to correct its authors, title, abstract, bibliographic or download information, contact: (Katjana Gattermann).
If references are entirely missing, you can add them using this form.