Eucken under the Pillow: The Ordoliberal Imprint on Social Europe

Three main features set this paper apart from the existing literature. First, this analysis extends the chronological scope beyond the current eurozone crisis to include also the origins of the ordoliberal imprint on Social Europe. Second, it offers a comprehensive review of the literature examining the ordoliberal management of the crisis, considering the economics as well as the politics and institutions of the crisis. Third, the crisis of Social Europe is analysed theoretically using a critical political economy approach married to historical, sociological and discursive institutionalist perspectives that are treated here as much more mutually complementary than mutually exclusive. The first section presents the main ideas of German ordoliberalism, interpreted as a project of a competitive ‘order' promoted and framed by constitutional and regulative principles and binding rules. The influence of the ordoliberal school of thought on the treaty on the European Economic Community and subsequently on the architecture of the Economic and Monetary Union (EMU) is then analysed for its significance for Social Europe. In a subsequent step, the relationships between ordoliberalism and the social market economy are clarified. The second part of the paper analyses and explains the responses to the eurozone crisis. Tracing the policy implemented, it returns to the ordoliberal ‘crisis narrative' before analysing responses addressed to the crisis at the European level under the informal leadership of the German governments. Finally, the paper explains the predominance of the ordoliberal approach in framing responses to the crisis (in spite of its economic shortcomings and long-lasting social consequences) as a product of international and domestic factors.