THE GRADUATE CENTER OF CUNY

THE POLITICAL ECONOMY OF THE EUROPEAN UNION:
 PAST, PRESENT, FUTURE

H.M. Kaufmann
Office:            365 Fifth Ave., 5208
Office hours:   Th. 14:30-15:45 and by appointment
Tel.:                212-817-2052
Fax:                212-817-1577

Spring semester, 2004

The objective of this interdisciplinary seminar on the European Union (EU) is to analyze the interaction of economics and politics between the EU, the member states, the accession countries and the nonmembers in the context of policy-making and policies in several key areas. In these areas, policy-making is not simply a process within the EU or the member states, but a complex process that involves both.

The seminar begins with the understanding that policy-making and economic policy in Europe have been moving in some policy areas to the "supranational" level for several decades. One can argue that there are hardly any important areas of policy-making left in which the national-international interaction is not present and might well increase after the EU Convention.

Among the major topics to be discussed are: monetary policy prior to and after the introduction of the euro in "Euroland" (in12 of the 15 Member States, so far); the Stability and Growth Pact, much maligned and ignored, especially by the large member states; competition policy and EU international competitiveness; the common agricultural policy (CAP), the bone of contention intra- and extra-EU and a source of contention as the EU will be enlarged; the long-lasting unemployment problem and employment policy; and last but not least, we shall turn our attention to the major economic and political problems of enlargement of the European Union -- from the present 15 to 25 states to take place in spring of 2004.
(4 credits)

Required Texts

• De Grauwe, Paul. The Economics of Monetary Integration, New York: Oxford University Press, 2003. Fifth edition.
  
• Molle, Willem. The Economics of European Integration: Theory, Practice, Policy. Brookfield, VT: Ashgate Publishing, 2001. Fourth Edition.
  
• Pelkmans, Jacques. European Integraton: Methods and Economic Analysis NY: Addison Wesley Longmans, 1997.
  
• Wallace, Hellen and William, eds. Policy-Making in the European Union. NY: Oxford UP, 2000. Fourth Edition.
  
• Financial Times. Special student subscription available.

Table of Contents

I. FORMS AND PROCESSES OF EUROPEAN ECONOMIC INTEGRATION

II. HISTORY AND POLITICAL-ECONOMIC STRUCTURE OF WESTERN EUROPE: THE WHY AND HOW OF INTEGRATION

A. German Unification

III. THE SINGLE EUROPEAN ACT ("EUROPE 1992"), INDUSTRIAL CHANGE AND INTERNATIONAL COMPETITIVENESS

IV. POLITICAL ECONOMY OF EMU: FROM THE ECU TO EURO

A. Exchange Rate Systems - An Overview

B. Main Factors Affecting Exchange Rates

C. The Anatomy of Financial Instability

D. The EMS as "Zone of Monetary Stability for Europe"

E. Theory of Optimum Currency Areas

F. From EMS and ERM to EMU

 1. Prerequisites and Preparations for EMU: Convergence and the Creation of a European Central Bank

2. The Euro

G. The ECB and Monetary Policy

H. Restoration of Global Financial Stability

V. THE STABILITY AND GROWTH PACT.

VI. THE POLITICAL ECONOMY OF (UN)EMPLOYMENT AND MIGRATION: MOBILITY WITHIN AND BETWEEN EU COUNTRIES

VII. THE POLITICAL ECONOMY OF AGRICULTURE

VIII. MAASTRICHT (1991)--AMSTERDAM (1997) -- NICE (2000)--LAEKEN (2001) 

IX. THE FUTURE OF EU: DEEPENING AND WIDENING (ENLARGEMENT)-- A EUROPEAN UNION OF 27?

A. Transition From State to Market
B. Enlargement Issues for the EU

I. FORMS AND PROCESSES  OF EUROPEAN ECONOMIC INTEGRATION

We can discern different forms of economic integration. In the introduction to the political economy of the European Union we will analyze the framework within which the European Economic Community was transformed to what is currently called the Economic Union. We will study the process and different forms of integration and compare and analyze their relative economic and political costs and benefits - and distinguish between the short and the long run trade-offs. We shall also explore economic and non-economic aspects of economic growth, development and wealth.

Readings:

Molle, Chapters 1 and 2.

Pelkmans, Chapter 1: "What is Economic Integration?"

Wallace, "Institutions, Process, and Analytical Approaches" in Wallace, Part I.

Boldrin, Michele and Fabio Canova. "Inequality and Convergence in Europe's Regions: Reconsidering European Regional Policies." Economic Policy, 32 (April 2001):205-53.

Dyson, Kenneth. "EMU as Europeanization: Convergence, Diversity, and Contingency." JCMS 38(4, November 2000):645-66.

Landes, David in Lawrence E. Harrison (Editor). Culture Matters: How Values Shape Human Progress. NY: Basic Books, 2000.

Mundell, Robert A. "A Reconsideration of the Twentieth Century." AER 90(3 June 2000):327-40.

Newhouse, John. Europe Adrift. The Conflicting Demands of Unity, Nationalism, Economic Security, Political Stability, and Military Readiness Now Facing a Europe Seeking to Redefine Itself. NY: Pantheon 1997. 

Wallace, William. "Europe, the Necessary Partner." Foreign Affairs, 80(3 May/June 2001):16-34.

II. HISTORY AND POLITICAL-ECONOMIC STRUCTURE OF WESTERN EUROPE: THE WHY AND HOW OF EUROPEAN INTEGRATION

In this section we will analyze decision-making institutions of the EU and of the relevant institutions of France, Germany, Britain, and Italy. We will then examine the dynamics of political and economic integration, the relationship between politics and the economy, and evolving analytical approaches to the decision-making community-building. 

Readings:

Molle, Chapters 2 and 3

Pelkmans, Chapter 2: "Developing Economic Integration in the Union."

Abegaz et al. "Introduction: The Challenge of European Integration." In Abegaz, Berhanu et al., eds. The Challenge of European Integration, Chs. 1 and 23.

Anderson, Christopher. "Economic Uncertainty and European Solidarity Revisited: Trends in Public Support for European Integration." Rhodes and Sonia Mazey, eds. The State of the European Union, Vol. 3, Ch. 5.

Braunerhjelm, Pontius and Lars Oxelheim. "Does Foreign Direct Investment Replace Home Country Investment?" JCMS 38(2 June 2000):199-221.

Caporaso and Keeler. "The European Community and Regional Integration Theory." In Rhodes and Mazey, eds. The State of the European Union, Vol. 3, Ch. 2.

Eichengreen, Barry. "The International Economy: Historical Perspectives and Future Prospects." In Feketekuty, Geza. "Regional Blocs: Policy Coordination and Trade Strategy." In Abegaz, Berhanu et al., eds. The Challenge of European Integration, Ch. 5.

Feketekuty, Geza. "Regional Blocs: Policy Coordination and Trade Strategy." In Abegaz, Berhanu et al., eds. The Challenge of European Integration, Ch. 5.

Hansen, Lene and Michael C. Williams. "The Myths of Europe: Legitimacy, Community and the 'Crisis' of the EU. JCMS 37(2 June 1999):233-49.

Kirman, Alan and Mika Widgrén. "European Economic Decisionmaking Policy: Progress or Paralysis?" Economic Policy, 21(October 1995):423-60.

Krugman, Paul. "Is Capitalism Too Productive?" Foreign Affairs (September/October 1997):79-94.

Lawrence, Robert Z. "Regionalism, Multilateralism, and Deeper Integration". Washington, DC: Brookings Institution, 1996.

Mazey and Richardson, "Pressure groups and lobbying in the EC." Challenge, Ch. 2.

Sbragia, Euro-Politics, Chs. 1-4, 8.

Slemrod, Joel. "What Do Cross-Country Studies Teach about Government Involvement, Prosperity, and Economic Growth?" Brookings Papers on Economic Activity (2, 1995):373-431.

van Ark, Bart and Dirk Pilat. "Productivity Levels in Germany, Japan, and the United States". Brookings Papers on Economic Activity (2:1993):1-69.

A. German Unification

Gardner, Edward H. and William RM. Perraudin, "Asymmetry in the ERM: A Case Study of French and German Interest Rates Before and After German Unification." International Monetary Fund, Staff Papers 40(June 1993):427-50.

Henry, Jérôme and Jens Weidmann, "German Unification and Asymmetry in the ERM." International Monetary Fund, Staff Papers 42(4, December 1995):894-902.

Siebert, Horst. "German Unification: The Economics of Transition". Economic Policy 13 (October 1991):287-340.

Sinn, Gerlinde and Hans-Werner Sinn. Jumpstart: The Economic Unification of Germany. Cambridge, MA: MIT Press, 1994.

III. THE SINGLE EUROPEAN ACT ("EUROPE 1992"), INDUSTRIAL CHANGE AND INTERNATIONAL COMPETITIVENESS

In this section, we will examine the relationship between industrial and technological change (industrial expansion, and the decline and conversion of smoke-stack industry) and various agreements, beginning with the European Coal and Steel Community in 1952, and culminating in the "Europe 1992" project. We will focus on change and the politics of change in France, Britain and Italy. We will examine the question of why the impact of the Community was greater in these countries than in Germany. We will also analyze the impact of industrial policy, as well as questions of trade and competition. Is "Europe 1992" most easily understood as industrial policy on a grander scale? What is the meaning of "competition" and "free trade" in the context of an economic community?

Readings:

McGowan, Francis. "Competition Policy." In Wallace, Ch. 5.

Molles, Chapters 5-8, 14

Pelkmans, Chapters 5-10: Internal Market.

Woolcock, Stephen. "European Trade Policy." Wallace, Ch. 14.

Young, Alasdair R. "The Single Market." In Wallace, Ch. 4.

Baily, Neil Martin and Hans Gersbach. "Efficiency in Manufacturing and the Need for Global Competition." Brookings Papers on Economic Activity "Microeconomics" (1995):307-58.

Bottasso, Anna and Alessandro Sembenelli. "Market Power, Productivity and the EU Single Market Program: Evidence from a Panel of Italian Firms." European Economic Review 45(1:2001):167-86.

Duchene and Shepherd, Eds., Managing Industrial Change in Western Europe, Chs. 1,2,7,8.

Görg, Holger and Frances Ruane. "US Investment in EU Member Countries: The Internal Market and Sectorial Specialization. JCMS 37(2 June 1999):333-48.

Hall, Governing the Economy, Chs. 1,3,7,10 (R)

Hurwitz and Lequesne, The State of the European Community, Chs. 23-26 (R)

Lodge, The European Community, Ch. 3, 10, 11 and 14 (R)

Mayes, David and Peter Hart. The Single Market Program as a Stimulus to Change. Comparisons Between Britain and Germany. NY: Cambridge University Press, 1994.

Scherer, F.M. Competition Policies for an Integrated World Economy. Washington, DC: Brookings Institution, 1994.

Wegner, Manfred. "Trade Growth, and Industrial Structure." In Henning, et al., eds. Reviving the European Union. Washington, DC: Institute for International Economics, April 1994, Ch. 6.

Wilson, Business and Politics, Chs. 2-5, 7 (R)

Yarbrough, Beth V. "Preferential Trade Agreements and the GATT: EC 1992 as Rogue or Role Model?" In Abegaz, Berhanu et al., eds. The Challenge of European Integration, Ch. 3.

IV. POLITICAL ECONOMY OF EUROPEAN ECONOMIC AND MONETARY UNION: FROM THE ECU TO THE EURO

This section focuses on what has become an essential core of the political economy of European integration, both because of its economic implications, and because it has become politically linked to continuing nationalism within the European Union. We will focus most intensely on England, France and Germany, as pieces of a complex political and economic puzzle. The story of the snake, the hare and the tortoise.

Readings:

De Grauwe, Paul. Economics of Monetary Union.

Molle, Chapter 15.

Pelkmans, Chapter 3: "Economic Constitution of the EU."

Chapter 16: "European Macro-economic Cooperation."

Chapter 17: "Economic and Monetary Union."

Tsoukalis, Loukas. "Economic and Monetary Union." In Wallace, Ch. 6.


Ardy, Brian. "Economic and Monetary Union: A Review Article." Journal of Common Market Studies (JCMS) 38(4:November 2000):667-76.

Youngs, Richard. "The Politics of the Single Currency: Learning the Lessons of Maastricht." JCMS 37(2:June 1999)295-316.

A. Exchange Rate Systems - An Overview

Dornbusch, Rudi. "Fewer Monies, Better Monies." American Economic Review 91(2; May 2001), Papers and Proceedings, pp.238-47.

Mussa, Michael, Paul Masson, Alexander Swoboda, Esteban Jadresic, Paolo Mauro, and Andy Berg. Exchange Rate Regimes in an Increasingly Integrated World Economy. IMF, Occasional Paper 193, 2000. http://www.imf.org/external/pubs/ft/op/193/

B. Main Factors Affecting Exchange Rates.

Bach, Christopher L. "U.S. International Transactions, Revised Estimates for 1982-98." U.S. Department of Commerce, Bureau of Economic Analysis. Survey of Current Business (July 1999):60-74.

Bach, Christopher L. "U.S. International Transactions, Revised Estimates for 1982-99." U.S. Department of Commerce, Bureau of Economic Analysis. Survey of Current Business (July 2000):70-77.

Salvatore, Dominick. International Economics. New York: Prentice-Hall, 2001. Seventh edition.

C. The Anatomy of Financial Instability

Jeanne, Olivier. Currency Crises: A Perspective on Recent Theoretical Developments. International Finance Section, Special Papers in International Economics, No. 20. Princeton, NJ: Department of Economics, Princeton University, March 2000.

Jeanne, Olivier and Jeromin Zettlemeyer. "International Bailouts, Moral Hazard and Conditionality." Economic Policy 33(October 2001):407-32.

Mishkin, Frederic S. "Global Financial Instability: Framework, Events, Issues." The Journal of Economic Perspectives 13(4, Fall 1999):3-20.

Sholes, Miron S. "Crisis and Risk Management." AER 90(2, May 2000, Papers and Proceedings):17:21.

Summers, Lawrence H. "International Financial Crises: Causes, Prevention, and Cures." AER 90(2, May 2000, Papers and Proceedings):1-16.

D. The EMS as "Zone of Monetary Stability for Europe"

Alesina, Alberto and Vittorio Grilli, "On the Feasibility of a One-Speed or Multispeed European Monetary Union." In Eichengreen, Barry and Jeffry Frieden, eds. The Political Economy of European Monetary Unification, Ch. 6.

Andrews, David M. "European Monetary Diplomacy and the Rolling Crisis of 1992-1993." In The State of the European Union Vol. 3, Ch. 7.

Bajo-Rubio, Oscar, Simón Sosvilla-Rivero, Fernando Fernández-Rodríguez. "Asymmetry in the EMS: New evidence based on non-linear forecasts." European Economic Review 45(3, 2001):451-73.

Cohen, Benjamin J. "Beyond EMU: The Problem of Sustainability." Economics and Politics 5(1993):187-203.

Committee of Governors of the Central Banks of the Member States of the EC. The Implications and Lessons Drawn from the Recent Exchange Crisis. Basel: Bank for International Settlements, 1993.

De Grauwe, Paul. "Towards European Monetary Union Without the EMS." Economic Policy 18(April 1994):147-85.

de Lattre, André. "The Single Currency as a Stabilizing Factor in International Relations: A French View." In Scheherazade S. Rehman, ed. Financial Crisis Management in Regional Blocs. Boston: Kluwer Academic Publishers, 1998, pp. 95-105.

Dornbusch, Rudiger, Ilan Goldfajn and Rodrigo Valdés, "Currency Crises and Collapses". Brookings Papers on Economic Activity (2,1995):219-93.

Economic Affairs, 16(3, Summer 1996). Symposium on costs and benefits of Emu.

Eichengreen, Barry. "European Monetary Unification." Journal of Economic Literature (September 1993):1321-57.

Eichengreen, Barry, Andrew K. Rose and Charles Wyplosz. "Exchange Market Mayhem: The Antecedents and Aftermath of Speculative Attacks." Economic Policy, A European Forum 21(October 1995):251-312.

Eichengreen, Barry and Charles Wyplosz. "The Unstable EMS." Brookings Papers on Economic Activity (1:1993):51-143.

Fratianni, Michele. "What Went Wrong with the EMS and European Monetary Union?" In Berhanu Abegaz et al., eds. The Challenge of European Integration. Internal and External Problems of Trade and Money. Boulder, CO: Westview Press, 1994, pp. 219-35.

Goldstein, Morris and Jacob A. Frenkel. "The Macroeconomics of Currency Zones." In Berhanu Abegaz et al., eds. The Challenge of European Integration. Internal and External Problems of Trade and Money. Boulder, CO: Westview Press, 1994, 169-98.

Goodman, Monetary Sovereignty.

Hagen, Juergen von and Michele Fratianni, "The Transition to European Monetary Union and the European Monetary Institute." In Eichengreen, Barry and Jeffry Frieden, eds. The Political Economy of European Monetary Unification, Ch. 7.

Hurwitz and Lequesne, The State of the European Community, Vol. 1, Chs. 7, 14.

Kaufmann, "From EMS to European Economic and Monetary Union...," in Kurz, Ed., German Unification and European Integration (R)

Kaufmann, "The Importance of Being Independent: Central Bank Independence and The European System of Central Banks." In The State of the European Union, Vol. 3, Ch. 12.

Kenen, Economic and Monetary Union in Europe. Moving beyond Maastricht. New York: Cambridge University Press, 1995.

McKinnon, Ronald I. "The Rules of the Game: International Money in Historical Perspective." Journal of Economic Literature 31(1, Mar 1993):1-44. [Excellent overview with references of the topics included in this seminar.]

Nordhaus, William D. "Policy Games: Coordination and Independence in Monetary and Fiscal Policies". Brookings Papers on Economic Activity (2:1994):139-216.

Obstfeld, Maurice. "International Currency Experience: New Lessons and Lessons Relearned" Brookings Papers on Economic Activity, (1:1995):119-220. 25th Anniversary Issue.

Obstfeld, Maurice and Kenneth Rogoff. "The Mirage of Fixed Exchange Rates." Economic Perspectives 9(Fall 1995):73-96.

Portes, Richard and Hélène Rey. "The emergence of the Euro as an International Currency." Economic Policy 26(April 1998):305-43.

Reed, Howard Curtis. "Managing Financial Crises: Who's in Charge?" In Scheherazade S. Rehamn, ed. Financial Crisis Management in Regional Blocs. Boston: Kluwer Academic Publishers, 1998, pp. 9-27.

Rinaldi, Roberto and Carlo Santini. "Italy: Two Foreign Exchange Crises." In Scheherazade S. Rehman, ed. Financial Crisis Management in Regional Blocs. Boston: Kluwer Academic Publishers, 1998, pp.55-94.

Sandholtz, Wayne. "Choosing Union: Monetary Politics and Maastricht." International Organization 47(1993):1-40.

Taylor, Christopher. EMU 2000. "Prospects for European Monetary Union". Chatham House Papers. London: The Royal Institute of International Affairs, 1995. [Good for background information.]

Tietmeyer, Hans."Financial Crisis Management in the EU/ERM." In Scheherazade S. Rehman, ed. Financial Crisis Management in Regional Blocs. Boston: Kluwer Academic Publishers, 1998, pp. 39-54.

Walters, Sir Alan. "Monetary Unions in Europe." In In Scheherazade S. Rehman, ed. Financial Crisis Management in Regional Blocs. Boston: Kluwer Academic Publishers, 1998, pp. 31-37.

Weidenfeld, Werner. "Europe - Just a Zone of Stability?" International Politik (Transatlantic Edition) 1(4:Winter Issue 2000):3-10.

Willett, Thomas D. "Some Often Neglected Aspects of the Political Economy of European Monetary Integration." In Berhanu Abegaz et al., eds. The Challenge of European Integration. Internal and External Problems of Trade and Money. Boulder, CO: Westview Press, 1994, 205-18.

Williger, Kaspar. "EMU and the Swiss Franc." In Scheherazade S. Rehamn, ed. Financial Crisis Management in Regional Blocs. Boston: Kluwer Academic Publishers, 1998, pp. 108-113.

Woolley, John T. "Linking Political and Monetary Union: The Maastricht Agenda and German Domestic Politics." In Eichengreen, Barry and Jeffry Frieden, eds. The Political Economy of European Monetary Unification, Ch. 4.

E. Theory of Optimum Currency Areas.

De Grauwe. "Costs of a Common Currency." Ch. 1.

-----. "The Theory of Optimum Currency Areas: A Critique." Ch. 2.

-----. "The Benefits of a Common Currency." Ch. 3.

-----. "Costs and Benefits Compared." Ch. 4.

Mundell, Robert. "A Theory of Optimum Currency Areas." AER 51(4:September 1961):657-65 [locus classicus].

F. From EMS and ERM to EMU.

1. Prerequisites and Preparations for EMU: Convergence and the Creation of a European Central Bank. 

De Grauwe. "The Transition to a Monetary Union." Ch. 6.

Buiter, Willem H. "Alice in Euroland." Journal of Common Market Studies 37(2, June 1999):181-209.

Frieden, Jeffrey, et al. The New Political Economy of EMU. Lahman, Md. and Oxford: Rowman and Littlefield, 1998.

Holtferich, Carl-Ludwig. "Did Monetary Unification Precede or Follow Political Unification of Germany in the 19th Century?" European Economic Review 37(2,3 Apr. 1993):518-24.

Youngs, Richard. "The Politics of the Single Currency: Learning the Lessons of Maastricht." Journal of Common Market Studies 37(2, June 1999):295-316.

2. The Euro.

Padoa-Schioppa, Tommaso. "The Euro and Politics." Internationale Politik (Transatlantic Edition) 1(4:Winter Issue):11-17.

G. The ECB and Monetary Policy.

Orphanides, A. and V. Wieland. "Inflation Zone Targeting." ECB, Working Paper No. 8 (October 1999).

Tristani, O. and C. Monticelli. "What Does The Single Monetary Policy Do?" ECB, Working Paper No. 2 (May 1999).

H. Restoration of Global Financial Stability

Caprio, Gerard and Patrick Honohan. "Restoring Banking Stability: Beyond Supervised Capital Requirements." Foreign Policy 116 (Fall 1999):43-64.

Edwards, Sebastian. "How Effective are Capital Controls?" Foreign Policy 116 (Fall 1999):65-84

Fischer, Stanley. "On the Need for an International Lender of Last Resort." Foreign Policy 116 (Fall 1999):85-104

Frankel, Jeffrey. "The International Financial Architechture." Brookings Institutions, "Policy Briefs" 51 (June 1999). Http://www.brookings.edu.

Minton Beddoes, Zanny. "The International Financial System." Foreign Policy 116 (Fall 1999):16-27

Rogoff, Kenneth. "International Institutions for Reducing Global Financial Instability." Foreign Policy 116 (Fall 1999):21-42.

V. THE STABILITY AND GROWTH PACT.

Readings:
Molle, Chapter 16.

Artesis, Phillip, Kevin McCauley and Malcolm Sawyer. "The Future of the Euro. Is there an Alternative to the Stability and Growth Pact?" The Jerome Levy Institute of Bard College, Public Policy Brief No. 63, 2001.

Artis, Michael J. and Marco Buti. "'Close-to-Balance or in Surplus': A Policy-Maker's Guide to the Implementation of the Stability and Growth Pact." JCMS 38(4, November 2000):563-92.

Forni, Mario and Lucrezia Reichlin, "Federal policies and local economies: Europe and the US." European Economic Review, 45(1; 2001):109-34.

Smaghi-Lorenzo-Bini; Claudio Casini. "Monetary and Fiscal Policy Co-operation: Institutions and Procedures in EMU." Journal of Common Market Studies, 38(3; September 2000):375-91.

VI. THE POLITICAL ECONOMY OF (UN)EMPLOYMENT AND MIGRATION: MOBILITY WITHIN AND BETWEEN EU COUNTRIES

In this section, we will analyze the unemployment problem which was particularly serious on the European Continent, as well as policy related to the free movement of labor within the Community, and the movement of immigrants and refugees into Europe. We will look at the Schengen Agreements, and the negotiations that have followed these agreements, as well as other attempts to harmonize policy on internal and external border-crossing. We will look most intensely at the interactions between this process at the European level, and politics in Germany, France, Britain and Italy, each of which has a different perspective on migration questions. We will also examine the way this policy area is linked to broader questions of European security and European and national identities.

Readings:

Molle, Chapter 7.

Pelkmans, Chapter 15: "Equity for the Union?"

Adsera, Alicia and Carles Boix. "Must we choose? European unemployment, American inequality, and the impact of education and labor market institutions." European Journal of Political Economy 16(4; 2000):611-38.

Baldwin Edwards and Martin Schain, "The Politics of Immigration: Introduction," West European Politics, Special Issue on Immigration in Western Europe, April, 1994.

Balakrishnan, Ravi and Claudio Michelacci, "Unemployment dynamics across OECD countries," European Economic Review, 45(1; 2001):135-65.

Blanchard, Olivier and Lawrence F. Katz. "What Do We Know About the Natural Rate of Unemployment?" Journal of Economic Perspectives 11 (1, Winter 1997):51-72.

Burda, Michael. "Unemployment, Labor Markets and Structural Change in Eastern Europe." Economic Policy 16(April 1993):101-37.

Gray, David M. "An application of the 'insider-outsider' hypothesis: categorical adjustment assistance programs in France." European Journal of Political Economy, 17(1, 2001):139-56.

Guiraudon, Virginie. "European Integration and Migration Policy." JCMS 38(2:June 2000):251-71.

Hollifield, Immigrants, Markets and States, pp. Intro. and Ch. 8.

Lodge, Challenge, Chs. 7-9.

Nickel, Stephen. "Unemployment and Labor Market Rigidities: Europe versus North America." Journal of Economic Perspectives 11(3, Summer 1997):55-74.

Schimmelpfennig, Axel. "Structural Change of the Production Process and Unemployment in Germany." Kieler Studien 307. Tübingen 2000.

Schnapper, "The Debate on Immigration and the Crisis of National Identity", West European Politics, April, 1994.

Siebert, Horst. "Labor Market Rigidities: At the Root of Unemployment in Europe". Journal of Economic Perspectives 11(3, Summer 1997):37-54.

VII. THE POLITICAL ECONOMY OF AGRICULTURE

This section focuses on the arena of policy and policy-making which is most typical of what is often called "the European process." We will examine how policy-making works (and does not work) in this arena, as well as the interaction between the community and nation-state levels. We will focus most intensely on France, Germany and Britain, each of which had sharply different interests in a common agriculture policy.

Readings:

Molle, Ch. 9.

Pelkamns, Chapter 11: "Common Agricultural Policy." 

Rieger, Elmar. "The Common Agricultural Policy." In Wallace, Ch. 6.

Ackrill, Robert W. "CAP Reform 1999: A Crisis in the Making." JCMS 38(2:June 2000):343-53.

Anderson, Kym. "Multilateral Trade Negotiations, European Integration, and Farm Policy Reform." Economic Policy 18(April 1994):12-52.

Butler, Fiona. The EC's Common Agricultural Policy (CAP)." Challenge, #6.

European Commission. "European Economy, EC Agricultural Policy for the 21st Century". Reports and Studies, No 4, 1994.

European Commission. "European Economy, The Economics of the Common Agricultural Policy (CAP)". Reports and Studies, No 5, 1994.

Harvey, J.R. and K.J. Thomson. "Costs, Benefits and the Future of the Common Agricultural Policy." Journal of Common Market Studies 24(1, 1985):

Hurwitz and Lequesne, The State of the European Community, Ch. 13 (R)

Rosenblatt, et. al., The Common Agricultural Policy: Principles and Consequences (Occ. Paper No. 22/IMF/1988) (R)

VIII. MAASTRICHT (1991)-AMSTERDAM (1997) -- NICE (2000) -- LAEKEN (2001)

An analysis of the issues of the expansion of the European Political Union and the relations between the EU and other parts of Europe, as well as the rest of the world.

Readings:

Molle, Chapter 17.

Pelkmans, passim, see Index s.v. "Maastricht."

Blanchard, Froot Sachs. Transition in Eastern Europe. Chicago: The University of Chicago Press, 1994.

Buiter, Willem, Giancarlo Corsetti and Nouriel Roubini. "Excessive Deficits: Sense and Nonsense in the Treaty of Maastricht." Economic Policy 16(April 1993):57-100.

Eichengreen, Barry. "Should the Maastricht Treaty Be Saved?" Essays in International Finance, Princeton, No. 74, December 1992.

Miles, Lee. The European Union and the Nordic Countries: Impacts on the Integration Process." In The State of the European Union Vol. 3, Ch. 14.

Miles, Lee, John Redmond and René Schwok, "Integration Theory and the Enlargement of the European Union." In The State of the European Union Vol. 3, Ch. 8.

Swann, The Single European Market and Beyond, Chs. 7 and 10-12.

Keohane and Hoffmann, The New European Community, Ch. 5 (R)

IX. THE FUTURE IF THE EU: DEEPENING AND WIDENING (ENLARGEMENT) - A EUROPEAN UNION OF 27?

Readings:
Molle: Chapter 18.

A. Transition from State to Market

Berglof, Erik and Patrick Bolton. "The Great Divide and Beyond: Financial Architecture in Transition." Journal of Economic Perspectives 16(1, 2002):77-100.

Boeri, Tito and Katherine Terrell. "Institutional Determinants of Labor Reallocation in Transition." Journal of Economic Perspectives 16(1, 2002):51-76

Estrin, Saul. "Competition and Corporate Governance in Transition." Journal of Economic Perspectives 16(1, 2002):101-24. 

Filler, Randall K. and Jan Hanousek. "Research Data from Transition Economies." Journal of Economic Perspectives 16(1, 2002):225-40. (Caveat emptor!).

Megginson, William L. and Jeffrey M. Netter. "From State to Market: A Survey of Empirical Studies on Privatization." Journal of Economic Literature 39(2, June 2001):321-89.

Roland, Gérard. "The Political Economy of Transition." Journal of Economic Perspectives 16(1, 2002):29-50.

Svejnar, Jan. "Transition Economies: Performance and Challenges." Journal of Economic Perspectives 16(1, 2002):3-28.


B. Enlargement Issues for the EU

Boeri, Tito, Axel Borsch-Supan and Guiido Tabellini. "Would you like to Shrink the Welfare State? A Survey of European Citizens." Economic Policy 32:(7-50).

European Commission. Enlargement: Strategy Paper. Regular Reports from the Commission on Progress towards Accession by each of the candidate countries. November 8, 2000.  <http://europa.eu.int/comm/enlargement//report_11_00/index.htm>

Falkner, Gerda. "Effects of EU Membership on a New Member State." JCMS 38(2:June 2000):223-50.

Friis, Lykke and Anna Murphy. "The European Union and Central and Eastern Europe: Governance and Boundaries." JCMS 37(2:June 1999):211-32.

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