Common EU budget and coordination of macroeconomic policies

The course presents the rationale for macroeconomic policy coordination in the European Union, its various dimensions, goals and history. These are put as a background to discuss current issues related to common fiscal capacity, fiscal rules reform as well as the political economy of the EU budget.

1. Macroeconomic policies: Fiscal policy, Monetary policy, Exchange rate policy, Trade policy, Structural policies, Financial regulations and their roles in macro stabilisation, potential growth, risk management and redistribution.

2. EU and macro policies. What makes the EU special why coordinate macroeconomic policies in the EU?

3. The history of macroeconomic coordination in the EU

4. The EU budget: Multiannual Financial Framework, size, main priorities. Political economy of the EU budget.

5. Monetary policy coordination - from the EMS to the EMU and beyond.

6. Stability and Growth Pact and the EU fiscal rules.

6. The persisting gaps in the economic architecture of the EU. Why do they persist?

7. COVID to the rescue? The role of pandemics and climate crisis in enhancing coordination of macroeconomic policies. Discussion of the current ideas in the public debate.

The course is interactive, requires occasional reading of academic papers between classes. Active participation will have a positive influence on the final grade.

The final exam is oral.