Philippe Martin, Lucrezia Reichlin, 01 March 2022

What are the economic imperatives and legal hurdles for reform? A new CEPR Policy Insight identifies the fault lines in the EU framework and suggests what can be done economically and legally to repair them.

Read more about this research and download the Policy Insight:
M. Maduro, P. Martin, JC Piris, J. Pisani-Ferry, L. Reichlin, A. Steinbach, B. Weder di Mauro, Revisiting the EU framework: Economic necessities and legal options, CEPR Policy Insight No 114.

Carlo Carraro, Benoît Cœuré, Otilia Dhand, Barry Eichengreen, Melinda Mills, Hélène Rey, André Sapir, Daniela Schwarzer, 01 March 2022

Miguel Poiares Maduro, Philippe Martin, Jean-Claude Piris, Jean Pisani-Ferry, Lucrezia Reichlin, Armin Steinbach, Beatrice Weder di Mauro, 16 December 2021

The stability and adequacy of the European monetary and fiscal frameworks are increasingly challenged by enduring changes in the economic environment. This column summarises the findings of a group of economists and lawyers specialised in EU matters who undertook a comprehensive assessment of the economic requirements and legal conditions of a well-functioning macroeconomic policy system for the EU and the euro area. They propose reforms of economic framework in line with economic necessities along three dimensions (coordination of fiscal and monetary policies, fiscal rules, and fiscal capacity at EU level) and assess their legal feasibility. They conclude that meaningful reforms that would bring legal clarity and improve economic performance are feasible within the confines of existing primary law.

Fabio Canova, Evi Pappa, 09 November 2021

In light of last year’s launch of the Next Generation EU funds, understanding the effectiveness of the EU’s use of structural funding has become even more important. This column examines the role of the European Regional Development Fund and the European Social Fund over time. While both have contributed to job creation and economic recovery, the former had a more short-term direct effect and the latter a more medium- to long-term indirect impact. There is significant regional heterogeneity in these impacts, driven by location, level of development, EU tenure, and euro area membership.

Marco Buti, Marcello Messori, 13 October 2021

The way European policymakers solve the policy mix trilemma of asymmetric fiscal rules, no central fiscal capacity and constrained monetary policy in the post-pandemic economy will define the resilience of the euro area in the face of future shocks and the transition to a more sustainable growth model. In a new CEPR Policy Insight, the authors argue that moving to a structured vertical coordination between national and EU budgets would help ensure an adequate fiscal stance and avoid the overburdening of the single monetary policy.    

Päivi Leino-Sandberg, Vesa Vihriälä, 31 May 2021

The EU’s response to the COVID-19-induced economic crisis has been aggressive, but not without criticism. This column, part of the Vox debate on euro area reform, summarises some of the shortcomings of the way in which the EU’s Next Generation programme may play out, and suggests short- and longer-term considerations that need to be made in order to ensure that the programme strengthens the Union in the long run.

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