Policy paper 166
Automatic stabilisers for the euro area: what is on the table?
This Policy paper by Nathalie Spath contributes to the debate on how to equip the euro area with a mechanism for asymmetric shocks absorption. It considers 3 proposals: a cyclical shock insurance, a European Unemployment Insurance and a Reinsurance.
The analysis finds that all three proposals offer sophisticated mechanisms that could be implemented at the European level to ensure automatic stabilisation. All three offer different promises and problems and a preference for one or the other is a question of priorities. The CSI is based on an indicator with limited precision but offers lean requirements. The proposal offers a technical solution by smoothing cyclical deviation; it is based on a narrow economic approach. The EUI is based on a more holistic approach. Payments at the individual level make the mechanism tangible to citizens but, at the same time, add complexity to the design. The major challenges lie in the harmonization of labour markets and a consequentially complex legal procedure, including treaty changes. The Reinsurance provides insurance for severe crisis, and is thus only semi-automatic. Although it can be understood intuitively, the discretionary element adds an administrative burden that is difficult to realize at the European level.
The introduction and part 1 lay out the problem of macroeconomic stabilisation, part 2 reviews existing proposals and assesses their specificities. Part 3 analyses the findings and discusses potential remedies to mitigate the proposals’ identified challenges. The Policy paper concludes providing policy makers with a sound basis to evaluate the promises and problems of the three automatic stabiliser proposals.
SUR LE MÊME THÈME
ON THE SAME THEME
PUBLICATIONS
Pension systems in Europe
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Parents’ leaves in the EU
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The war in Ukraine:
what are the consequences for European organisations?
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MÉDIAS
MEDIAS
L’Irlandais Paschal Donohoe reconduit à la présidence de l’Eurogroupe
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Il y a vingt ans, l’arrivée des premiers euros
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« L’hétérogénéité croissante de la zone euro menace sa cohésion »
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ÉVÉNEMENTS
EVENTS
My Europe – The European Union, ally or danger for workers? [FR]
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The European Union and work: what competences, what debates, what perspectives? [FR]
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Paris, 12 April 2019 – Session no.6 of the Académie Notre Europe: economic and monetary Union
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Prague, 28th March – Europe and the young, a winning couple?
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Paris, 21 January 2019 – A European unemployment insurance system: what Europeans really think
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Berlin, 19 September 2018 – Making Europe’s Economic Union Work
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Châlons-en-Champagne, 6 September 2018 – Recruiting, Training and Employment in Marne: what about Europe?
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Bruges, 12 July 2018 – Just a transition or a just transition? Jobs, skills, energy poverty
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Luxembourg, 20 June 2018 – The reform of the EMU: which social dimension?
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Paris, 20 June 2018 – Future Europe
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Nicosia, 16 March 2018 – The political landscape of EMU reform
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Sofia, 9 March 2018 – The future of the EU budget
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Athens, 8 February 2018 – Athens’ days: Greece, paths for hope
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Bruxelles, 25 January 2018 – Academy study trip to Brussels
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Paris, 8 December 2017 – Academy: Political and Social Europe
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Marseille, 28 September 2017 – Language, youth and employment
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Barcelona, 22 September 2017 – After the crisis, a push forward for the eurozone
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Paris, 21 July 2017 – The future of the Eurozone and the Multiannual Financial Framework
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Bruges, 13 July 2017 – Just a transition or a just transition? Jobs, skills, energy poverty
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Rome, 20 March 2017 – Completing economic governance and enhancing social cohesion
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Lisbon, 24th January – High-level seminar on the future of the euro
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