EAVA By / October 10, 2014

Common unemployment insurance scheme for the euro area : Cost of Non-Europe Report

The European Parliament has called for a “social dimension” to the Economic and Monetary Union to tackle unemployment and restore…

© masterofall686 / Fotolia
Common unemployment insurance scheme for the euro area
© masterofall686 / Fotolia

The European Parliament has called for a “social dimension” to the Economic and Monetary Union to tackle unemployment and restore growth following the recent economic crisis. Among various alternative options, automatic stabilisers could potentially be means of stabilising the Eurozone, while at the same time addressing social problems associated with the financial crisis.

This Cost of Non-Europe report explores the prospects for introducing an automatic stabilizer in the form of an Unemployment Insurance Scheme for the euro area, which will provide the monetary union with greater stability in the medium and long term. It builds on two research papers commissioned for the purpose, which are included as annexes.

Analysis of its potential benefits, had it existed during the recent crisis, shows that such a scheme would have reduced the fall in GDP in the most affected Member States by 71 billion euro in the period between 2009 and 2012.

Read the whole Study here

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Comments
  • By whom shall be this Common unemployment insurance scheme financed? ECB will simply print even more money for overindepted Member States not ready to undertake any structural reforms and postpone by this “insurance scheme” the collapse of the whole euro area?

    • Thanks for your comment and sorry for the delayed answer. The report was presented to the Employment and Social Affairs committee on 4 November and several members expressed their concerns too on how measures, to cushion shocks to the economy of the Euro area, should be financed. The study is a contribution to the Committee´s on-going work to explore possible actions to reinforce the social pillar of the European Monetary Union and which might result in specific policy proposals at a later stage. You can follow the work of the Employment and Social Affairs committee on the Committees website http://www.europarl.europa.eu/committees/en/empl/home.html

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