Panel Discussion on ‘Cost of Non-Europe: A Route to Growth without Debt?’

Written by Zsolt Pataki

Introduction by

• Klaus WELLE, Secretary General of the European Parliament

Guest Speakers:

• Fabrizio CORICELLI, Paris School of Economics
• Dr Thieß PETERSEN, Bertelsmann Stiftung
• Dr Marius-Cristian FRUNZA, Laboratoire d’Excellence Régulation Financière

Moderator:

• Joe DUNNE, EPRS, Acting Director for Impact Assessment and European Added Value

The absence of common action at European level could mean that, in a specific sector, there is an efficiency loss to the overall economy. Similarly, a collective public good that might otherwise exist may not be realised, if policies are not pursued effectively. This panel discussion will address issues related to this potential ‘Cost of non-Europe’.

The European Parliament’s recent study – ‘Mapping the Cost of Non-Europe, 2014-19‘ – attempts to estimate potential gains to the European economy of more ambitious EU-level action in 24 policy areas. The economic benefit could build up annually to a point where, on present calculations, some 990 billion euro (about 7.5 per cent of EU GDP) might be added to the European economy.

Professors Nauro Campos of Brunel University, Fabrizio Coricelli of the Paris School of Economics and Luigi Moretti of the University of Padua, recently calculated how much countries benefit from membership in the EU, by using the method of ‘synthetic counterfactuals’. They identified some substantial potential for positive pay-offs, with a gain in per capita GDP of approximately 12%.

Two other institutions have been investigating the potential gains. A recent estimate by the Bertelsmann Stiftung Institute, based on a calculation of cumulative gains in real GDP per capita, estimated that, between 1992 and 2012, the economy of all EU Member States (except Greece) benefited from substantial income gains due to the European integration process. Additionally, the Laboratoire d’Excellence Régulation Financière is trying to assess the robustness of a fully-fledged Economic and Monetary Union by examining  two hypothetical scenarios of future financial crisis. Preliminary results show that with enhanced fiscal coordination, the EU could save 0.45% of GDP should another financial crisis arise Full and uniform implementation of the Banking Union across the 28 countries would save 1.5% of GDP in a scenario of financial crisis, mainly by limiting the impact on growth of a predictable credit crunch.

For reasons of space, the panel discussion is open to EU Institution pass holders only.