Abstract
In the economic policy domain, calls for insurance-type cooperation within the European Monetary Union (EMU) have frequently been made. Insurance-type cooperation relates to the debate about macroeconomic stabilization tools helping to absorb asymmetric shocks within EMU. Adopting a legal perspective, this article aims explores the scope offered under the current EU treaties in establishing such cooperation mechanisms. Among the broad variety of policy proposals, we focus particularly on both a permanent EU unemployment scheme and a shock-based insurance. We identify the potential legal basis for these insurance schemes highlighting differences in legal feasibility given their specific design. We also discuss the endowment of insurance funds setting out four different funding modes under the EU treaties or on intergovernmental basis. We show that legal scope for insurance schemes is limited. Fully-fledged unemployment insurance schemes are likely to overstretch the boundaries of the EU treaties. More narrowly designed, however, such schemes are rather likely to be feasible if set up as shock-based mechanisms, where the gravity of the economic shocks is significant.
Highlights
Future modes of EU economic coordination can be analysed by reference to two models. 1 First, the “surveillance model”, which corresponds to the transgression of the status quo under which Member States continue to have full fiscal competence and retain competence to conduct economic policy. 2 In this scenario, the EU continues to be the “discipline enforcer”, applying numerical fiscal rules and the existing budgetary and economic surveillance system
Among the broad variety of policy proposals, we focus on both a permanent
We identify the potential legal basis for these insurance schemes highlighting differences in legal feasibility given their specific design
Summary
Future modes of EU economic coordination can be analysed by reference to two models. 1 First, the “surveillance model”, which corresponds to the transgression of the status quo under which Member States continue to have full fiscal competence and retain competence to conduct economic policy. 2 In this scenario, the EU continues to be the “discipline enforcer”, applying numerical fiscal rules and the existing budgetary and economic surveillance system. Building on the fiscal capacity, an EMU-level stabilization tool to support adjustment to asymmetric shocks, facilitating stronger economic integration and convergence and avoiding the setting up of long-term transfer flows, could become a. In this vein, the most recent Five Presidents’ Report, supra n. Given the existing reservations and obstacles to further deepening coordination mechanisms, ambitious treaty amendments appear (politically) unlikely and underscore the significance of effective application of the existing legal framework Against this background, the purpose of this article is to discuss the legal feasibility of insurance-type cooperation within the current framework of EU Treaties as one central element of the fiscal federalism model.
Sign-in/Register to view highlights & summary Sign-in/Register to access full text options 
Talk to us
Join us for a 30 min session where you can share your feedback and ask us any queries you have
Schedule a callDisclaimer: All third-party content on this website/platform is and will remain the property of their respective owners and is provided on "as is" basis without any warranties, express or implied. Use of third-party content does not indicate any affiliation, sponsorship with or endorsement by them. Any references to third-party content is to identify the corresponding services and shall be considered fair use under The CopyrightLaw.
