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EMU reform and resilience in a re-dimensioned EU

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  • Bongardt, Annette
  • Torres, Francisco

Abstract

Although significant progress has been made in various areas since the eruption of the financial and sovereign debt crises, EMU governance is still incomplete today. The incompleteness of EMU governance, notably in its economic sphere, leaves EMU vulnerable to adverse market and to political-economy pressures. This paper argues that the EU exit of the UK, which had negotiated an opt-out from the common currency already at Maastricht, may allow for more homogeneous preferences regarding the additional requirements on the economic union as to sustain monetary union. To that end it could facilitate decision-making and contribute to the completion of the governance of EMU, whose relevance as the core of the EU integration project Brexit has come to reinforce. The resilience of the Eurozone however continues to hinge importantly on the creation of adjustment capacity and ownership of reform at the member state level, for which it is important to have a cohesive approach to the completion of EMU and a less negative narrative on EU integration at the domestic levels.

Suggested Citation

  • Bongardt, Annette & Torres, Francisco, 2016. "EMU reform and resilience in a re-dimensioned EU," LSE Research Online Documents on Economics 69001, London School of Economics and Political Science, LSE Library.
    • Handle: RePEc:ehl:lserod:69001
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    File URL: http://eprints.lse.ac.uk/69001/
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    References listed on IDEAS

    as
    1. Jones, Erik & Torres, Francisco, 2015. "An ‘economics’ window on an interdisciplinary crisis," LSE Research Online Documents on Economics 65332, London School of Economics and Political Science, LSE Library.
    2. Paul de Grauwe, 2013. "Design Failures in the Eurozone: Can they be fixed?," Europe in Question Discussion Paper Series of the London School of Economics (LEQs) 7, London School of Economics / European Institute.
    3. Annette Bongardt & Francisco Torres, 2016. "The Political Economy of Brexit: Why Making It Easier to Leave the Club Could Improve the EU," Intereconomics: Review of European Economic Policy, Springer;ZBW - Leibniz Information Centre for Economics;Centre for European Policy Studies (CEPS), vol. 51(4), pages 214-219, July.
    4. Francisco Torres, 2009. "The Role of Preferences and the Sustainability of EMU," Palgrave Macmillan Books, in: Leila Simona Talani (ed.), The Future of EMU, chapter 3, pages 54-74, Palgrave Macmillan.
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    More about this item

    Keywords

    Brexit; Institutional Reform; EU Economic Governance; EMU Resilience and Sustainability.;
    All these keywords.

    JEL classification:

    • E42 - Macroeconomics and Monetary Economics - - Money and Interest Rates - - - Monetary Sytsems; Standards; Regimes; Government and the Monetary System
    • E61 - Macroeconomics and Monetary Economics - - Macroeconomic Policy, Macroeconomic Aspects of Public Finance, and General Outlook - - - Policy Objectives; Policy Designs and Consistency; Policy Coordination
    • E65 - Macroeconomics and Monetary Economics - - Macroeconomic Policy, Macroeconomic Aspects of Public Finance, and General Outlook - - - Studies of Particular Policy Episodes

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