Documents Kouba, Ludek 4 results

"The European integration process is ongoing. Europe is still heterogeneous. Within this context, the paper addresses the question of whether policies in the EU should head towards autonomy, coordination or harmonization. Taking the path dependence effect into account, in the papers' opinion, Europe has gone too far in its integration process to be able to continue with policies fully under the competencies of individual member countries. Furthermore, the establishment of the common currency in the EU as a result of deep harmonization in the monetary policy area is an unambiguous precedent with many consequences. First of all, the habitual question still arises in the literature: does fiscal policy need to be harmonized to a comparable level, as these two policies necessarily complement each other? The paper argues that it does not. First, the authors build on the theory of fiscal federalism, which often recommends the strengthening of the stabilization function of public finance; typically in the form of rules and surveillance institutions (e.g., Fiscal Compact, the Six-Pac, European Semester). And on the contrary, they usually refute the intensification of the redistribution function, due to the fact that intergovernmental transfers in contemporary Europe are highly unpopular. Second, Europe is still too heterogeneous and it will continue to be so in the future, simply because of the different cultures, mentalities, traditions, social relations and ways of thinking it harbours. In our context, this means that there are significantly different regimes of welfare states and extents of social policies among European countries, which strongly determine the character of public finance. And third, the tax systems across Europe are also highly divergent, with many different features of continued tax competition. Therefore, a top-down harmonization path towards a full fiscal union is neither politically enforceable, nor economically rational. On the other hand, in order to keep the European integration process viable, it is necessary to reduce behaviour with features of moral hazard and free ride and strengthen joint responsibility for the fiscal development of public finances in the EU. In addition to the discussed matter of joint responsibility and fiscal discipline, the paper points out the open coordination method as an approach towards a sustainable alternative path between a fragmented Europe and a European super state."

"The debate about the Eurozone's future usually centres on a clash between economics and politics. Giving the EU greater oversight powers and more spending capacity is said to be the only viable long run solution, but there is little popular appetite for this option. As a result, the Eurozone seems destined to ‘muddle through' to the benefit of creditor countries. This paper seeks to offer fresh insights into this debate by highlighting a third, overlooked dimension, namely the challenge of making governance work in practice. Recommendations for new Eurozone institutions come at a time when EU mechanisms and funds are under fire for being too complex and ineffective. They are said to create moral hazard, lack flexibility, and to heighten bureaucratic red tape. The EU, and the Eurozone, may be facing a crisis of maturity whereby the creation of new institutions risks making matters worse. To illustrate this argument, the paper assesses the desirability and feasibility of two possible governance innovations among those currently under discussion in the Eurozone: a mechanism of wage coordination, and contractual arrangements (or ‘reform contracts') between the EU and member states. Beyond economic and political arguments, the paper invites commentators and policymakers to shift their focus of attention from conception to implementation."

"Despite significant measures to reinforce the EMU's institutional set-up, there is widespread consensus that more needs to be done in order to better deal with cyclical and structural heterogeneity in the EU. Market-based adjustment mechanisms are necessary but not sufficient to advance convergence along more sustainable growth patterns. In that context, institutional reforms advancing integration in the Eurozone are often said to be desirable from an economic point of view, albeit fraught with political difficulties. This paper seeks to provide a fresh outlook on this debate by bringing forward a third, overlooked dimension, namely the feasibility, or ‘implementability', of governance reforms. Like national technocracies, the EU faces the risk of failure whereby the creation of institutions or the introduction of new policies do not always bring about the expected outcomes. The paper develops a multi-criteria analytical framework to assess three possible innovations of economic governance: rule-based wage coordination, contractual arrangements for reforms, and a stabilisation fund for the Euro area. The ‘robustness' of any proposal seeking to increase the EU's interference into national policy-making should start with a clear economic justification, while taking the dynamics of national preferences into account. However, the risks of moral hazard and institutional barriers should also be systematically internalised in the assessment. After outlining the analytical framework (section 1), the paper assesses the three tentative reforms by using a wide range of data and analyses from existing EU documentation, academic and policy literature, and opinion surveys (sections 2 to 4). Each section ends with some recommendations on the desirable scope and design of reforms. Overall, the three case studies stress the need for a careful and reasoned approach to reforming EU governance. Beyond the predictable clash of economic rationales and political hurdles, reform ideas tend to overlook the difficulties arising at the implementation stage. Diverse wage-setting systems, low administrative capacities, and statistical uncertainty for instance all warn against ‘more EU money' or ‘EU interference'. The paper, therefore, makes the case for experimental and small-scale innovations and for a much greater engagement of the public in the politics of EU coordination."

"The aim of this paper is to analyse and discuss the heterogeneity level between the old and new EU member states in terms of welfare state development. In order to discuss the research questions, we performed the cluster analysis that provides the overall survey of the welfare state development and besides that, the results were divided into four dimensions: demographic, economic, institutional and social. In comparison with the thematic literature, we modified the dimensions, including our original institutional dimension, and added a dynamic point of view. The cluster analysis resulted in the existence of three clusters: Core cluster, Periphery cluster and Eastern cluster. The Eastern cluster is still relatively stable and covers in a total of nine of the ten Central and Eastern European countries that were included in the analysis: Bulgaria, the Czech Republic, Estonia, Hungary, Latvia, Lithuania, Poland, Romania and Slovakia (hence apart from Slovenia). On the other hand, using the dimensional approach, the CEE countries were grouped together with the old EU member countries, both from the Core cluster and from the Periphery cluster, within the economic and institutional dimensions. Therefore, we conclude that the new EU member countries, nowadays, do not form an internally homogenous group in terms of the features of their welfare state."