A Theoretical Approach of Economic and Monetary Union

The literature strongly suggests that the creation of Economic and Monetary Union (EMU) was largely influenced by the power of ideas, an accommodation to international markets challenges. The outcome was EMU’s political-economy inspired by the monetarist school, a considerable disempowerment of national governments. Put in the perspective of European integration theories, EMU seemed to reject liberal intergovernmentalism claims that member states’ interests are the major input to European integration developments. However, since the monetary union was launched several events showed that national governments re-captured the influence they theoretically lost with EMU. Notably the persistent breach of the Stability and Growth Pact might be the evidence that EU institutions (especially the Commission) and other societal actors lost ground to national governments. The paper asks whether the operation of EMU reflects a paradigm change in terms of European integration theories: how liberal intergovernmentalism emerged as the theory with greater explanatory potential of EMU in motion.