The Political Economy of the Euro Area and its Future

The euro area is slowly recovering from years of crisis management and hectic institution-building under constant pressure of market panic. The political threat of euro-phobic administrations in the Netherlands and France have been averted. Economic growth has returned to the most hard-hit member states in Southern Europe. Both the challenge of an unpredictable US administration and the decision of the UK to leave the EU seem to have strengthened the integrationist forces among euro area policymakers. But like the calm after the storm, this state of euro affairs is fragile: Italy is the obvious case for an imminent after-shock that may materialise between the publication of this call and the ECPR conference. Terrorist attacks can lead to rapid political swings which would affect the capacity of member state governments to act collectively at the euro area level. Voters’ pushback against years of falling real incomes and cutbacks in social services is virulent. Non-euro area member states resent the gravitational pull of the currency union and may actively resist further integration of the euro area. For this section, we invite panels and papers that address the present state of the euro area in political-economic terms, possibly with a view to the foreseeable vulnerabilities of its recovery. What has stabilised the euro area and its members? How have newly created institutions fared when first tested, like bail-in rules and the revamped machinery of fiscal surveillance? What does the banking union mean for EU member states outside? Has the Commission been permanently weakened or was this merely a temporary effect of crisis politics? Have the bailout programmes been politically and economically as devastating as feared; did they provide effective or only temporary relief; are they case studies in creative destruction of unviable regimes? Is the European Central Bank’s withdrawal from extraordinary measures contested and precarious, or a surprising return of the status quo ante? What have we learnt about the political economy of the euro area over the last decade? We welcome papers from a range of disciplines, including sociology, history and law.