Gastcollege Universiteit Antwerpen (UA)

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dimension of European integration UA 25 April 2018 Frank Vandenbroucke Professor at the University Amsterdam Structure and robust welfare states: a tragic dilemma? 1 The social project according to founding fathers: belief in convergence 2 Explanations: what stopped ‘convergence machine’? Increasing heterogeneity Member States erosion states 3 policies (social investment) 4 reconciling openness domestic cohesion: political challenge Design flaws way forward: A Social Union • would support simultaneous pursuit economic progress cohesion both within countries (through gradual development states) between upward across Union) Initial division labour: – development: supranational coordination security rights & anti-discrimination: national sovereignty (in theory) machine worked… more or less… until 2004/2008 dilemma integration? project? Inequality Europe 0 6 7 8 9 5 inequality (US representative state = 1) Median income US ‘representative state’ (EU MS EU MS’ EU27 distribution: moving scale Romania Denmark Top quintile 32% 133% 30% 140% 28% 145% 23% 152% 100% average 27 01 02 03 04 05 06 07 08 50 100 150 200 250 300 350 400 450 500 Relative frequency Net disposable standardized household as % median EU15 EU12 poverty threshold Goedemé e Mountains on move pan-European distribution enlarged heterogeneous EU)? forward : Minimum wages governments can do: net couple with children one minimum-wage earner 5000 10000 15000 20000 25000 30000 35000 40000 45000 LU IE AT FI UK DE FR NL DK BE IT SI EL CZ ES SK EE PL HU LT PT LV RO BG Gross wage Source: CSB/MIPI Poverty risks population < 60 by work intensity 10 20 30 40 Very high High Medium Low low At-risk-of-poverty rate (< 60) Work 2004-06 2012 Bron: Eurostat SILC 2005-2007; 2013 Erosion states? Changing composition households? More precarious jobs? Migration? contribution transfers (not pensions) reduction 15 Inefficient ‘pension-heavy’ mature ? own calculation ‘poverty (excl pensions)’ total 2005-2007 en poverty: diagnosis policy lessons for There is no one-size-fits-all explanation hence silver bullet tackle increasing inequalities We need set complementary strategies instruments that improve protection employment perspectives households weak attachment labour market “Improving our human capital requires child-centred investment strategy addresses opportunities ” “The should promote Reconciling Access benefits: general principle non-discrimination exception: posting workers Transparency coverage minimum regimes Division consequences monetary unification De Grauwe Transfers might mitigate symmetry/flexibility trade-off EU’s recently: symmetry flexibility Flexibility determines order current roadmap: stability an ‘insurance union’ An insurance union  Banking Capital Fiscal stabilisation capacity Institutional advantage coordinated bargaining Competitiveness: symmetrical approach necessary EMU union: vaccination metaphor Why are stabilization centralized unions? Risk sharing (pooling) Externalities public good (vaccination) •Vaccination: compulsory (minimum requirements) subsidized (re-insurance) •Minimum requirements effective capacity: –sufficiently generous unemployment benefits notably short-term; –sufficient rates benefit schemes; –no segmentation leaves part force poorly insured; proliferation relations not integrated into insurance; –effective activation unemployed individuals; –budgetary buffers times so automatic stabilisers do their bad •These principles become fortiori imperative if Eurozone be equipped re-insurance systems: institutional moral hazard EMU: common standards resilient shared conception Labour institutions deliver (effective collective bargaining) Cluster adequate MS: sufficiently sufficient insured against unemployment; systems individuals ⇒Convergence some key features ⇒European Pillar Rights Gothenburg Summit 17 November 2017 •support systemic level functions (e g fair corporate taxation …) •guide substantive via objectives leaving ways means basis operational definition ‘the model’ cooperate explicit purpose pursuing ⇒based reciprocity Resources (1) puzzles paradoxes in: Boone Marc; Deneckere Gita Tollebeek Jo (eds ) End Postwar Future - Essays Ian Buruma Verhandelingen van de KVAB voor Wetenschappen Kunsten Nieuwe reeks 31 Uitgeverij Peeters 2017; accessible www frankvandenbroucke uva nl; also available Blackboard Barnard Baere after Crisis Cambridge: Cambridge Press September https://doi org/10 1017/9781108235174 Introductory chapter Open nl item 263; Reduction Sharing Moral Hazard: Vaccination Metaphor Intereconomics Vol 52 May/June Number pp 154-159 From https://www socialeurope eu/gothenburg-social-summit-european-social-union (2) Structural versus competition: limits diversity Economic Monetary ECFIN discussion paper 065 Commission Directorate-General Financial Affairs Brussels July http://ssrn com/abstract=3008621 Rinaldi In: Vision Consortium ): Redesigning Ways Gütersloh (http://www vision-europe-summit eu/) Collado Meeusen Recent trends EU-wide dynamics old new member Improve Working Paper 2014 improve-research eu Trindade perspective low-income CSB 17/03 Antwerp: Herman Deleeck Centre Policy (University Antwerp) All publications downloaded from: