A Review of Europe's Economic Horizon

A Review of Europe's Economic Horizon

About the Speech:

Dr. Stefan C. Collignon, Visiting Professor at Harvard University, and Professor of European Political Economy at the London School of Economics, argued that Europe's sluggish economic performance was linked to its institutional architecture. He explained why he thought that the reform of the Stability and Growth Pact was inherently wrong, as the externalities arising from aberrant national decisions had implications for all Member States - hence the need for mechanisms to constrain Member States who disregarded the rules.

He remarked that Irish growth rates have dropped from 9% to 4% and that unit labour costs in Ireland were considerably higher than Germany, which, as the EU member state with the lowest unit labour costs in Euroland. Germany will soon have a competitive advantage over many other Member States, leading to the eventual recovery of the German economy.

Professor Collignon then suggested that the design of macroeconomic policy should be a mix, based on the aggregate in Euroland, but only if the citizens were allowed to choose (following the mantra - no taxation without representation). He called for national debates on the options open to EU Member States and asserted that a democratically elected EU government, capable of legitimately enforcing macroeconomic reforms at the highest level, is urgently needed to reinvigorate the European economy.

About the Speaker:

Dr. Stefan C. Collignon, Visiting Professor at Harvard University, and Professor of European Political Economy at the London School of Economics.