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Professor Uwe Puetter Department of Public Policy Central European University, Budapest Mail: puetteru@ceu.hu Web: http://www.ceu.hu/profiles/faculty/uwe_puetter

“EU socio-economic governance”

MA class – 2 credits

Winter Term 2012 (2 credits)

Time: Wednesdays, 9.00-10.40 hrs

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Information about the course: aims, objectives, learning outcomes This course is aimed at MA students with a specialised interest in EU economic and social policy who already have a good knowledge of EU policy-making in general and/or in other policy areas - both at an empirical and theoretical level. The course provides access to core policies and governance mechanisms in the field of EU socio-economic governance. It combines insights into fundamental and historical developments – such as the development of freedom of movement for labour in the context of the single market or the establishment of Economic and Monetary Union – with a review of contemporary policies choices – such as within the context of the Stability and Growth Pact and the Lisbon process. The course aims at engaging students with core theories and research perspectives which have been applied to EU socio-economic governance with a view of developing core analytical skills required for independent post-graduate research in this policy field. At a methodological level the course is based on an interactive teaching format with an emphasis on student involvement. A course reader will assemble all compulsory readings following the course structure (see below) and will refer students to further readings. Students will engage in group and project work with view to applying empirical and conceptual knowledge in a case-based context. All students will be required to complete a small independent research project for in-class presentation using ICT techniques and collective review. At the end of the course students will have to submit a research paper. At the end of this course student will have developed a profound understanding of the EU’s role in economic and social policy-making. Students will be able to analyse and understand contemporary debates over policy choice and institutional design in the light of historical processes of institution building and diverse models of domestic economic governance. Moreover, students will have developed a critical understanding of the core theories and research perspectives applied in this field of study. They are able to engage in independent research activities covering aspects of EU economic and social policy and can critically review alternative policy options. With a longer term view to their further academic and professional development this course prepares students for career in policy practice. As civil servants, policy analysts and representatives of civil society organisations they have obtained the qualifications necessary to make or advise on informed policy choices on a range of subjects relating to EU socio-economic governance and contribute to innovative thinking and policy solutions. Literature REQUIRED READINGS need to be prepared by all course participants. All texts in this category are available through the electronic journal databases of the library. Book chapters are either provided through the course website at http://e-learning.ceu.hu and/or are on reserve as hardcopy in the book section provided for this course in the CEU library. FURTHER READINGS are recommended for further research and should be consulted by those writing their research paper on the related topic. Those preparing an in-class presentation are required to consult the sources listed under the PRESENTATION section of the course outline. There are no required core text books for this class but students looking for books covering a wide range of aspects of the topics studied in this class may find the following books particularly helpful: Hodson, D. (2011), Governing the euro area in good times and bad (Oxford: Oxford University Press). Heipertz, M./ Verdun, A. (2010), Ruling Europe: the politics of the Stability and Growth Pact (Cambridge: Cambridge University Press).

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Shaw, J., J. Hunt, et al. (2007). Economic and social law of the European Union. Houndmills, Basingstoke, Palgrave Macmillan Puetter, U. (2009), Die Wirtschafts- und Sozialpolitik der EU, Wien/Stuttgart: Facultas WUV/UTB (in German only) Hervey, T.K. (1998), European social law and policy London, Longman A. Brunila, M. Buti and D. Franco (2001) The Stability and Growth Pact - The architecture of fiscal policy in EMU, Houndmills, Basingstoke General_Secretariat_of_the_Council and European_Commission (2007). Economic and Monetary Union. Legal and political texts. Luxemburg, Office for Official Publications of the European Communities. >> download electronic copy: http://ec.europa.eu/economy_finance/publications/publication10181_en.pdf Course requirements Successful completion of the course will require the completion of a research paper of 2800 words (60%), one in-class presentation (20%) and your participation in-class discussions (20%). Active participation in the in-class discussions is a precondition for the success of the course. Students are expected to participate in all seminars, to prepare the required readings for each session and to participate actively in the discussion. In addition, each student is encouraged to demonstrate a deeper knowledge of the course topics through consulting the additional readings as well as through independent research activity. Missing more than two classes without presenting a written note to the instructor may result in a failing grade. All students are required to offer one 15 min. in-class presentation. Presentation topics will be allocated during the first session. The main aim of the presentation is to critically assess the specified readings, to present and suggest other contributions on the topic including own research where applicable. A presentation should conclude with clearly identifying points for further discussion in the class. Students are encouraged to make use of presentation techniques such as overhead projectors, Power Point or the flip chart. You should indicate which type of ‘technology’ you want to use for your presentation at least one week before the relevant session. The DPP MA coordinator will help you with ordering the equipment for the respective session. You are required to complete a research paper in this course. Students need to discuss their choice of questions with the instructor to confirm choice and outline of the research paper. Your work will be judged on the basis of the quality of your presentation of the relevant literature and empirical information, as well as on your ability to critically assess these sources. Each paper should be approximately 2800 words in length. All essays should be typed (word-processed) and double-spaced. Please leave broad margins on both sides (4 cm)! Essays must be properly referenced, with a standard form of citation used (see the DPP Student’s Handbook for further details and consult with the Center for Academic Writing). You must also include a bibliography of all works consulted. All written contributions need to be original, i.e. produced exclusively by the student who submits the work. References to all other sources must be clearly indicated following accepted academic standards. Any text reproduction which is not clearly identified will have to be considered as

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plagiarism and, consequently, the submitted work will be acknowledged with no more than 0% of the mark. For further information, please do not hesitate to consult with the instructor of this course. Session 1 Economic ideas, varieties of capitalism, epistemic communities – theoretical perspectives and approaches on European socio-economic governance REQUIRED READING Leibfried, S./ Pierson, P. (1992), 'Prospects for Social Europe', Politics & Society, 20 (3), 333-366. Zimmermann, H. (2001). "The euro under scrutiny: History and theories of European monetary integration." Contemporary European History 10(2): 333-341. FURTHER READINGS Hix, S. (2005), The political system of the European Union (Houndmills Basingstoke: Palgrave Macmillan).

- chapter 8: pp. 235-270 Cameron, D. R. (1998). Creating Supranational Authority in Monetary and Exchange-rate Policy: The Sources and Effects of EMU. European Integration and Supranational Governance. W. Sandholtz and A. Stone Sweet. Oxford, Oxford University Press: 188-216. Marcussen, M. (2000). Ideas and elites: The social construction of Economic and Monetary Union. Aalborg, Aalborg University Press. Story, J. (2000), 'The political economy of European Union financial integration: the battle of the systems', in Colin Crouch (ed.), After the euro. Shaping institutions for Governance in the wake of European Monetary Union (Oxford: Oxford University Press), 90-108. PRESENTATION McNamara, K. R. (1998). The currency of ideas: monetary politics in the European Union. Ithaca, NY, Cornell Univ. Press.

- chapter 3 Session 2 The institutional architecture of Economic and Monetary Union (EMU) REQUIRED READINGS Jabko, N. (2010), 'The hidden face of the euro', Journal of European Public Policy, 17 (3), 318-334. Lisbon Treaty, Consolidated Version of the Treaty on the Functioning of the European Union, Title VIII, Economic and Monetary Policy

- chapters 1-4 (see http://europa.eu/documentation/legislation/index_en.htm for the electronic version of the Lisbon Treaty) FURTHER READINGS Moravcsik, A. (1998). The choice for Europe. Social purpose and state power from Messina to Maastricht. Ithaca, New York, Cornell University Press.

- chapter 6

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Dyson, K. (1994). Elusive union: the process of economic and monetary union in Europe. London, Longman. Sandholtz, W. (1993). "Choosing Union: Monetary Politics and Maastricht." International Organization 47(1). Verdun, A. (1999). "The role of the Delors Committee in the creation of EMU: An epistemic community?" Journal of European Public Policy 6(2): 308-328. Dyson, K. and K. Featherstone (1999). The road to Maastricht: Negotiating economic and monetary union. Oxford, Oxford University Press.

- chapter 16 PRESENTATION How was agreement on EMU reached? How was it conceived by core EU member states? What influenced the final shape of its institutional architecture? Consult the reading below and check out the digital archives of the European Navigator library for original documents and statements at http://www.ena.lu/ Dyson, K. and K. Featherstone (1999). The road to Maastricht: Negotiating economic and monetary union. Oxford, Oxford University Press.

- chapter 4: pp. 124-137 - chapter 6: pp. 256-274

Session 3 EU social and employment policy – integration through law REQUIRED READINGS Shaw, J./ Hunt, J./ Wallace, C. (2007), Economic and social law of the European Union (Houndmills, Basingstoke: Palgrave Macmillan).

- chapter 14, The development of a social dimension, pp. 341-366 - chapter 15, Equality law and policy, pp. 367-392

FURTHER READINGS Geyer, R. (2000), 'The state of European Union social policy', Policy Studies, 21 (3), 245-261. Falkner, G. (1998), EU social policy in the 1990s. Towards a corporatist policy community (London: Routledge).

- chapter 3, pp. 78-96 Threlfall, M. (2003), 'European Social Integration: Harmonization, Convergence and Single Social Areas', Journal of European Social Policy, 13 (2), 121-139. Smismans, S. (2004), Law, legitimacy, and European governance. Functional participation in social regulation (Oxford: Oxford University Press).

- chapter 2: Functional participation in social regulation: the case of European occupational health and safety policy

PRESENTATION Shaw, J./ Hunt, J./ Wallace, C. (2007), Economic and social law of the European Union (Houndmills, Basingstoke: Palgrave Macmillan).

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- chapter 15, Equality law and policy, pp. 367-392 - chapter 16, Employment law and policy, pp. 393-420

Session 4 The European Central Bank and the European System of Central Banks REQUIRED READING Hodson, D. (2011), Governing the euro area in good times and bad (Oxford: Oxford University Press).

- chapter 2: The European Central Bank as a reluctant EU institution, pp. 21-37 Issing, O. (2006), 'Central bank independence - economic and political dimensions', National Institute

Economic Review, (196), 66-76. FURTHER READINGS Howarth, D. and P. Loedel (2003). The European Central Bank. The New European Leviathan? Houndmills, Basingstoke, Palgrave Macmillan.

- chapters 3 and 5 de Haan, J., S. C. W. Eijffinger, et al. (2005). The European Central Bank. Credibility, Transparency, and Centralization. Cambridge, Massachusetts, The MIT Press. Kaltenthaler, K. (2003). "Managing the euro. European Central Bank exchange rate policy preferences." European Union Politics 4(3): 329-349. Shaw, J., J. Hunt, et al. (2007). Economic and social law of the European Union. Houndmills, Basingstoke, Palgrave Macmillan.

- chapter 8 Young, B. (2002). "The European Central Bank, monetary policy, and the Nordic welfare model." International Feminist Journal of Politics 4(3): 295-314. PRESENTATION Scheller, H. K. (2006). The European Central Bank. History, role and functions. Frankfurt a.M., European Central Bank. >> download electronic copy: http://www.ecb.eu/pub/pdf/other/ecbhistoryrolefunctions2006en.pdf

- chapter 2 Scheller, H. K. (2006). The European Central Bank. History, role and functions. Frankfurt a.M., European Central Bank. >> download electronic copy: http://www.ecb.eu/pub/pdf/other/ecbhistoryrolefunctions2006en.pdf

- chapter 3.1 (pp. 77-90) Summarise and discuss how the European Central Bank conducts monetary policy in the euro area. Session 5 EU social and employment policy – integration through policy coordination REQUIRED READING

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Borrás, S./ Jacobsson, K. (2004), 'The open method of co-ordination and the new governance patterns in the EU', Journal of European Public Policy, 11 (2), 185-208. FURTHER READINGS Trubek, D.M./ Mosher, J.S. (2003), 'New governance, employment policy, and the European social model', in Jonathan Zeitlin and David M. Trubek (eds.), Governing work and welfare in a new economy: European and American experiments (Oxford: Oxford University Press), 33-58. Sabel, C.F./ Zeitlin, J. (2008), 'Learning from difference: the new architecture of experimentalist governance in the EU', European Law Journal, 14 (3), 271-327. PRESENTATION In the view of the EU’s legislative competences in the field of social policy identified in Session 3 elaborate on Armstrong’s discussion of state of the art literature on the open method of coordination. In particular, explain how helpful – in your view – the distinction between ‘hard and soft law’ is for the analysis of different types of social policy-making. Amstrong, K.A. (2010), Governing social inclusion. Europeanization through policy coordination (Oxford: Oxford University Press).

- chapter 1 and 2 Session 6 The role of trade unions and organised business – consultation, corporatism, new governance REQUIRED READING Smismans, S. (2008), 'New modes of governance and the participatory myth', West European Politics, 31 (5), 874-895. Falkner, G. (2000), 'The Council or the social partners? EC social policy between diplomacy and collective bargaining', Journal of European Public Policy, 7 (5), 705-724. FURTHER READINGS Smismans, S. (2003), 'European civil society: shaped by discourses and institutional interests', European Law Journal, 9 (4), 473-495. Bernard, N. (2000), 'Legitimising EU law: is the social dialogue the way forward? Some reflections around the UEAPME case', in Jo Shaw (ed.), Social law and policy in an evolving European Union (Oxford: Hard Publishing). Gorges, M.J. (2001), 'The new institutionalism and the study of the European Union: the case of the social dialogue', West European Politics, 24 (4), 152-168. PRESENTATION There are various mechanisms through which the European Union institutionalises tripartite consultations between the Commissions and the Council, the trade unions and organised business. One format is the “social dialogue”, another one is the “macroeconomic dialogue”. Introduce both

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formats and explain how they function. Discuss whether they provide a venue for trade unions and business organisations to influence EU policy? Reversely, what may be the influence EU institutions exercise through these procedures? The resources below provide a good basis for your research: http://ec.europa.eu/employment_social/social_dialogue/index_en.htm http://ec.europa.eu/employment_social/spsi/european_networks_en.htm http://www.etuc.org/ http://www.businesseurope.eu http://www.ceep.eu Session 7 The Eurogroup REQUIRED READINGS Puetter, U. (2006). The Eurogroup : how a secretive circle of finance ministers shape European economic governance. Manchester [u.a.], Manchester Univ. Press.

- chapter 2, Why does EMU require informal governance?, pp. 36-62 Hodson, D. (2011), Governing the euro area in good times and bad (Oxford: Oxford University Press).

- chapter 3, The rise and fall of the Eurogroup, pp. 38-56 FURTHER READINGS Grosche, G. and U. Puetter (2008). "Preparing the Economic and Financial Committee and the Economic Policy Committee for enlargement." Journal of European Integration 30(4): 527-543. Wicks, N. (1999). A decentralised model of economic governance. Will EMU lead to European economic government? C. f. E. Reform. London, Centre for European Reform. Brouhns, G. (1999). "La coordination des politiques dans l'UEM et le role de l'Euro 11." Service d'Etudes et de Documentation, Ministère des Finances Belgique 59(2). Verdun, A. (2000). Governing by committee: the case of monetary policy. Committee governance in the European Union. T. Christiansen and E. Kirchner. Manchester, Manchester University Press. Campanella, Miriam L.: The Battle between ECOFIN-11 and the European Central Bank: A Strategic Interaction Perspective, in: Green Cowles, Maria/ Smith, Michael (eds.): The State of the European Union – Risks, Reform, Resistance, and Revival, Oxford University Press, Oxford 2000. Korkman, S. (2001). Fiscal policy coordination in EMU: Should it go beyond the SGP? The Stability and Growth Pact - The architecture of fiscal policy in EMU. A. Brunila, M. Buti and D. Franco. Houndsmills, Basingstoke, Palgrave: 287-312. PRESENTATION

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Puetter, U. (2006). The Eurogroup : how a secretive circle of finance ministers shape European economic governance. Manchester [u.a.], Manchester Univ. Press.

- chapter 3, The informal working method, pp. 63-85 - chapter 4, The agenda, pp. 86-111

Euro Summit, Statement, Brussels, 26 October 2011 http://www.consilium.europa.eu/uedocs/cms_data/docs/pressdata/en/ec/125644.pdf Review the Euro Summit conclusions for statements relating to the future status and role of the Eurogroup. Compare the recent changes with the original institutional basis of the Eurogroup and its informal working method. Session 8 The EU’s responses to the global economic and financial crisis REQUIRED READING Puetter, U. (2012), 'Europe's deliberative intergovernmentalism - the role of the Council and European Council in EU economic governance', Journal of European Public Policy, 19 (2). FURTHER READINGS Hodson, D. (2008), 'EMU und Political Union: What, if anything, have we learned from 10 years of the euro?', Journal of European Public Policy, 16 (4), 508-526. Jones, E. (2009), 'Output legitimacy and the global financial crisis: perceptions matter', Journal of Common Market Studies, 47 (5), 1085-1105. De_Schoutheete, P. (2011), 'Decision-making in the Union', Notre Europe Policy Brief, (24). <http://www.notre-europe.eu/uploads/tx_publication/Bref24-DeSchoutheete-EN.pdf>. PRESENTATION The difficulties for the EU and the euro area in dealing with the global economic and financial crisis have led to a renewed debate about the future of Europe. Some argue that the EU cannot deal with the crisis unless it integrates further and creates a full political union. Others argue that the crisis underlines the need for individual member states to take responsibility themselves and think that EU solidarity should have limits. Session 9 The challenge of macro-economic policy coordination – procedures and mechanisms REQUIRED READING Hodson, D. (2011), Governing the euro area in good times and bad (Oxford: Oxford University Press).

- chapter 4, Profligacy, prudence, and the Stability and Growth Pact, pp. 57-77 - chapter 5, Why the BEPGs failed to bite, pp. 78-94

consult for the legal foundations of the Stability and Growth Pact: General_Secretariat_of_the_Council and European_Commission (2007). Economic and Monetary Union. Legal and political texts. Luxemburg, Office for Official Publications of the European Communities. >> download copy: http://ec.europa.eu/economy_finance/publications/publication10181_en.pdf

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FURTHER READINGS Cabral, A. J. (2001). The main aspects of the working of the SGP. The Stability and Growth Pact - The architecture of fiscal policy in EMU. A. Brunila, M. Buti and D. Franco. Houndmills, Basingstoke: 139-157. Kröger, J. (2002). Problems of incentives within EMU: Experience with the Stability and Growth Pact. European Economic and Monetary Union: An initial assessment. R. Caesar and H.-E. Scharrer. Baden-Baden, Nomos Verlagsgesellschaft. Puetter, U. (2004). "Governing informally: The Role of the Eurogroup in EMU and the Stability and Growth Pact." Journal of European Public Policy 11(5): 854-870. Heipertz, M. and A. Verdun (2004). "The dog that would never bite? What we can learn from the origins of the Stability and Growth Pact." Journal of European Public Policy 11(5): 765-780. Issing, O. (2004). "The Stability and Growth Pact: The appropriate fiscal framework for EMU." International Economics and Economic Policy 1(1): 9-13. PRESENTATION Deroose, S./ Hodson, D./ Kuhlmann, J. (2008), 'The Broad Economic Policy Guidelines: before and after the re-launch of the Lisbon Strategy', Journal of Common Market Studies, 46 (4), 827-848. After the re-launch of the Lisbon Strategy the EU has more recently adapted the original coordination framework once again. The new framework operates under the title “Europe 2020”. Introduce the new mechanisms and compare the most recent adjustments in the context of Europe 2020 with the previous arrangements. All necessary resources and documents for preparing this short case study can be found online at http://ec.europa.eu/europe2020/index_en.htm Session 10 The enlargement of the euro area REQUIRED READING Dyson, K. (2006). Euro entry as defining and negotiating fit: conditionality, contagion, and domestic politics. Enlarging the euro area. External empowerment and domestic transformation in east central Europe. K. Dyson. Oxford, Oxford University Press. >> download copy: http://fds.oup.com/www.oup.co.uk/pdf/0-19-927767-2.pdf FURTHER READINGS Dyson, K. (2006) (ed.). Enlarging the euro area. External empowerment and domestic transformation in east central Europe. Oxford, Oxford University Press.

- edited volume on euro area enlargement featuring a set of country case studies Padoa-Schioppa (2003). "The euro goes east." Comparative Economic Studies 45(3): 215-231. Blavoukos, S. and G. Pagoulatos (2008). "The limits of EMU conditionality: Fiscal adjustment in Southern Europe." Journal of Public Policy 28(2): 229-253.

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Grosche, G./ Puetter, U. (2008). "Preparing the Economic and Financial Committee and the Economic Policy Committee for enlargement." Journal of European Integration 30(4): 527-543. Widfeldt, A. (2004). "Elite collusion and public defiance: Sweden's euro referendum in 2003." West European Politics 27(3): 503-517. Puetter, U. (2008). "Adapting to enlargement: The role of formal and informal processes of institutional adjustment in EU committee governance." Journal of European Integration 30(4): 479-491. Miles, L. (2005). "Introduction: Euro-Outsiders and the Politics of Asymmetry." Journal of European Integration 27(1): 3-23. PRESENTATION Discuss the contribution by Tuytschaever, which was written when the first group of EU member states launched the single currency, with a view to the years 2010 and beyond and the prospects for euro area enlargement? What institutional features may prevent or, conversely, accelerate the process accession to the single currency? Tuytschaever, F. (2000). EMU and the catch-22 of EU constitution-making. Constitutional change in the EU - from uniformity to flexibility. G. De_Búrca and J. Scott. Oxford, Hart Publishing: 173-195. Session 11 The external representation of the euro area and the EU-27 in global economic and financial coordination forums REQUIRED READINGS McNamara, K. R. and S. Meunier (2002). "Between national sovereignty and international power: what external voice for the euro?" International Affairs 78(4): 849-868. Bini Smaghi, L. (2004). "A single seat in the IMF?" Journal of Common Market Studies 42(2): 229-248. FURTHER READINGS Horng, D.-C. (2005). "The ECB's membership in the IMF: legal approaches to constitutional challenges." European Law Journal 11(6): 802-822. Scheller, H. K. (2006). The European Central Bank. History, role and functions. Frankfurt a.M., European Central Bank. >> download electronic copy: http://www.ecb.eu/pub/pdf/other/ecbhistoryrolefunctions2006en.pdf

- chapter 5 Christopher Hill and Michael Smith (eds.), International relations and the European Union (Oxford:

Oxford University Press). PRESENTATION Hodson, D. (2011), Governing the euro area in good times and bad (Oxford: Oxford University Press).

- chapter 6, Ensemble acting in the G20 and the IMF, pp. 95-113 - chapter 7, Bilateral diplomacy in Beijing and beyond, pp. 114-130

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Session 12 The future of EU socio-economic governance and the political integration of the Union Review session