European Union versus core state powers: the customisation of EU fiscal policy

Abstract

ABSTRACT Member states use implementation to preserve core state powers, such as fiscal policy, vis-à-vis the European Union (EU), by choosing whether to adopt stricter or looser rules than the EU requires. However, these choices and their reasons when the EU extends its fiscal competences are understudied. We theorise how the interplay of uploading and downloading factors might lead member states to customise EU fiscal policy according to their preferences, if their capacity allows it. Using fuzzy-set Qualitative Comparative Analysis, we study the customisation of six rules of the Fiscal Compact in France, Germany and Italy in 2012 (N = 18). Member states exercised ‘opposition through the back door’ when uploading outcomes did not reflect their preferences and did not provide a credible deterrent. More often, however, member states as ‘customisers’ acted as especially ambitious problem-solvers or signalled compliance, when uploading outcomes reflected their preferences or provided a credible enforcement threat.