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A Positive Explanation of EU Enlargement

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  • Daniel Brou
  • Michele Ruta

Abstract

Models of international unions suggest that large and rich countries reap little economic benefits from political integration with smaller and poorer countries. This paper challenges this view by presenting a formal study of economic influence by special interest groups in an international union. We first show that countries where more groups are organized to lobby gain from political integration on economic grounds. The reason is that a more organized country, under a political union, can affect policies in the other country to its advantage, something that a less organized country can do to a lesser extent. We then argue that richer countries will tend to have more organized interest groups before political integration and show that this will continue to be the case afterward. Hence, the model implies that there are costs and benefits of EU Enlargement to Eastern Europe in addition to those suggested by the existing literature.

Suggested Citation

  • Daniel Brou & Michele Ruta, 2004. "A Positive Explanation of EU Enlargement," Economics Working Papers ECO2004/30, European University Institute.
  • Handle: RePEc:eui:euiwps:eco2004/30
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    Cited by:

    1. Federico Etro, 2004. "The Political Economy of Fiscal and Monetary Unions," Giornale degli Economisti, GDE (Giornale degli Economisti e Annali di Economia), Bocconi University, vol. 63(3-4), pages 289-328, December.
    2. Ruta, Michele, 2003. "The allocation of competencies in an international union: a positive analysis," Working Paper Series 220, European Central Bank.
    3. Christina Schneider, 2007. "Enlargement processes and distributional conflicts: The politics of discriminatory membership in the European Union," Public Choice, Springer, vol. 132(1), pages 85-102, July.

    More about this item

    Keywords

    Lobbying; Public Goods; International Unions; European Enlargement;

    JEL classification:

    • D72 - Microeconomics - - Analysis of Collective Decision-Making - - - Political Processes: Rent-seeking, Lobbying, Elections, Legislatures, and Voting Behavior
    • F02 - International Economics - - General - - - International Economic Order and Integration
    • H41 - Public Economics - - Publicly Provided Goods - - - Public Goods

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