you're reading...
BLOG, Events

Summary: Panel Discussion on ‘Cost of Non-Europe’ study

Written by Kristina Svobodová and Zsolt Pataki

A Panel Discussion on ‘Cost of Non-Europe: A Route to Growth without Debt?’ took place on 10 October in the EPRS Library Reading Room.

The main goal was to present and discuss the Mapping the ‘Cost of Non-Europe’, 2014-19 study, focusing on the topic of whether, and to what extent, Member States benefit from EU membership, as well as revising the Cecchini report, published in 1988. The featured study is the result of a long-term project undertaken by the European Parliament’s European Added Value Unit, in cooperation with the office of the Secretary-General and the Economic Governance Support Unit.

How we gain from the ‘Cost of Non-Europe’?

Summary: Panel Discussion on ‘Cost of Non-Europe’ study

European Parliament

In his introductory speech, Klaus WELLE, Secretary General of the European Parliament, mentioned the necessity of having two approaches– both that of assessing the cost of actual regulation, as well as the cost of non-regulation. He emphasised the need to move beyond the ideological approach of merely addressing the impact of proposed legislation. Quantifying the cost of non-Europe enjoys the weight of several arguments: first, it helps to define a positive integration agenda for Europe. Second, it reintroduces a focus on outcome, a methodology often overshadowed by the focus on process. Third, it opens the dialogue with Eurosceptics, as it gives the argument of tangible economic benefits. ‘Cost of Non-Europe’ reports are not European Parliament-specific documents, but rather help establish consensus between European institutions on identified priorities.

Synthetic counterfactual method – Professor Coricelli, Paris School of Economics

In order to assess the impact of integration as a generator of growth, the key question to address is: what would have been the growth rates of per capita GDP in EU countries if they had not become fully-fledged EU members? The Synthetic Counterfactual Method answers this by developing a model for each European economy based on ‘placebo’ variables that would illustrate the state of the economy had the country not joined the EU. The analysis demonstrated that all Member States benefited from accession, on average, by 10% of their growth. The effect was dynamic and increased over time. In the case of the Eastern enlargement, however, the effect of accession was less pronounced because it had already kicked in during the rather long accession process. Nevertheless, the current dire economic conditions reflect the limitations of the EU architecture, especially those of the Euro in the face of large adverse shocks.

How to prevent crisis

Dr Marius-Cristian FRUNZA addressed the cost of non-Europe in two crisis scenarios: the financial crisis scenario and the sovereign crisis scenario. While financial crises are characterized by high market volatility, short term liquidity and credit default swap increase, he added that they are less endemic than sovereign crises and can be contained. He emphasised the importance of enhanced fiscal coordination, a common deposit guarantee scheme and fully-fledged banking union in preventing the crisis.

Why Greece did not benefit from EU membership

The speakers were in agreement on the observation that Greece was the only EU Member State not to benefit from joining the Union. Greece never implemented the reforms necessary to join the EU, nor fully joined the Single Market, an issue which became inflated over the years.

It was brought to the panel’s attention during the Q&A session, that quantifying, from a ‘Cost of Non-Europe’ perspective, the cost of austerity measures on European economies might be interesting.

Read more: The Cost of Non-Europe in the Single Market (Cecchini revisited)

About EPRSauthor

European Parliamentary Research Service of the European Parliament. The EPRS offers the best available research and analytical support to Members of the European Parliament, their staff, parliamentary committees and, of course, to you!

Discussion

No comments yet.

Leave a Reply

Fill in your details below or click an icon to log in:

WordPress.com Logo

You are commenting using your WordPress.com account. Log Out /  Change )

Google photo

You are commenting using your Google account. Log Out /  Change )

Twitter picture

You are commenting using your Twitter account. Log Out /  Change )

Facebook photo

You are commenting using your Facebook account. Log Out /  Change )

Connecting to %s

This site uses Akismet to reduce spam. Learn how your comment data is processed.

Download the EPRS App

EPRS App on Google Play
EPRS App on App Store
What Europe Does For You
EU Legislation in Progress
Topical Digests
EPRS Podcasts

Enter your email address to follow this blog and receive notifications of new posts by email.

Join 2,909 other followers

Disclaimer and Copyright statement

The content of all documents (and articles) contained in this blog is the sole responsibility of the author and any opinions expressed therein do not necessarily represent the official position of the European Parliament. It is addressed to the Members and staff of the EP for their parliamentary work. Reproduction and translation for non-commercial purposes are authorised, provided the source is acknowledged and the European Parliament is given prior notice and sent a copy.

For a comprehensive description of our cookie and data protection policies, please visit Terms and Conditions page.

Copyright © European Union, 2014-2018. All rights reserved.

%d bloggers like this: