The Pluralist Character of the European Economic Constitution

by Clemens Kaupa

Overview

This monograph intervenes in the long-standing and controversial debate on the socio-economic orientation of the European Union. Arguing that the European economic constitution is pluralist in the sense that it does not favour any specific socio-economic paradigm, it shows that European law allows the pursuit of very different regulatory projects by the European and the national legislators. This pluralist character of the European economic constitution stands in an uncomfortable relationship with the policies currently pursued by the European Union, which are often neoliberal in their orientation. The book takes an interdisciplinary approach: it analyses the Treaty on the Functioning of the European Union as interpreted and developed in the case law of the Court of Justice, its history, and its regulatory purpose in the light of conflicting socio-economic paradigms.By challenging the orthodoxy, the book makes a bold proposition that will likely resonate in both European economic law scholarship and European law in general. With the ongoing economic crisis triggering a significant interest in economic questions among legal scholars it is particularly timely and topical.

Product Details

ISBN-13:	9781509926442
Publisher:	Bloomsbury Academic
Publication date:	12/27/2018
Series:	Modern Studies in European Law
Pages:	400
Product dimensions:	6.14(w) x 9.21(h) x 0.82(d)

About the Author

Clemens Kaupa is Assistant Professor at VU University Amsterdam.

Table of Contents

Acknowledgements v

Introduction 1

Overview 1

Methodical Considerations 8

1 Interpreting the Treaty in its Historical Context I: The Treaty of Rome 14

Introduction 14

Trade Liberalization Prior to 1957 22

The Regulatory Approach of the Treaty of Rome: Enabling 'Undistorted Competition' in an 'Economic Union' Through Market-Making and Harmonization 26

The Means and Ends of the Community: Article 2 EEC 26

Economic Union 29

The Common Market within an 'Economic Union' 31

'Static' Gains from Integration 32

'Dynamic' Gains from Integration 36

Internal and External Economies of Scale 38

Competition 41

Changes in Investment Patterns 43

Normative Implications of the Debate on 'Static' and 'Dynamic' Gains from Integration 45

Coordination and Harmonization 47

The Path to 'Economic Union': The Interpretation of the Treaty of Rome by the Commission in the 1962 Action Programme 50

Competition Policy 53

Approximation of Laws 55

Tax Harmonization 58

The Approximation of Laws in the Field of Social Policy and the European Social Fund (ESF) 60

Regional and Industrial Policy and the European Investment Bank (EIB) 65

The Common Agricultural Policy (CAP) 68

The Coordination of Macroeconomic Policies and the Discussion on Economic Planning 73

Intermediate Findings 84

2 Interpreting the Treaty in its Historical Context II: The 1992 Project 86

Introduction 86

The Pressures to which the 1992 Project Reacted 91

The End of the Post-War Boom, the Oil Crises and the Unravelling of the Capital/Labour Compromise 91

Perceived Increase of Competition from Japan and the United States 92

The Centrifugal Forces of Market Integration 94

The Economic Assumptions Behind '1992' 96

Benefits from Market Integration-The Cecchini Report 97

Market Integration, Economic Stabilization and Equitable Distribution: The Padoa-Schioppa Report 99

The Primary Law Reforms of the 1992 Project 101

The Single European Act 102

The Maastricht Treaty 107

Assessing the Normative Implications of the Treaty Reforms 110

The Regulatory Strategies of '1992' 112

Mutual Recognition 115

Harmonization 120

How the 1992 Project Altered the Instrument of Harmonization 121

The Distinction Between the 'New' and an Alleged 'Old' Approach-An Ideologically Coded Dichotomy 123

The Commission's Three 'New Approaches': Continuities and Change in the Community's Harmonization Strategy 125

The Completive Measures of '1992' 132

The Economic and Social Cohesion Funds 134

European Monetary Union (EMU) 136

Some Economic Observations About Monetary Union 139

Short Historical Overview of European Monetary Integration 140

The Case for and Against Monetary Union 148

Industrial Policy 157

Intermediate Findings 161

3 The Internal Market Law Provisions and the Case Law Developed on its Basis 163

Introduction 163

The Pluralist Character of Article 34 TFEU: The Treaty Text and its Early Interpretation 165

The Pluralist Character of the Free Movement of Goods Case Law: Reassessing Dassonville, Cassis and Keck 174

The Pluralist Character of Articles 49 and 56 TFEU and the Doctrinal System Developed on its Basis 184

Balancing in Internal Market Law 189

Proportionality Balancing as an Open-Ended Process and as Political Choice 190

Proportionality Balancing in Internal Market Law 192

Two Studies of Doctrines in Internal Market Law Adjudication 197

The 'Interpreting Strictly' Doctrine 197

The 'Interpreting Strictly' Doctrine as a Tool of Interpretation 198

The 'Interpreting Strictly' Doctrine in Internal Market Law 200

The 'Reasons of a Purely Economic Nature' Doctrine 204

'Economic' Justifications Accepted by the CJEU Despite the 'Purely Economic Nature' Doctrine 205

On the Origins of the Doctrine 207

Case Groups 208

Intermediate Findings 216

4 A Purposive Interpretation of the Treaty: The Pursuit of the Union's Diverse Socio-Economic Objectives, and Economics as Contested Knowledge 218

Introduction 218

Dissent in the Discipline of Economics 223

A Short Overview of Different Socio-Economic Paradigms 223

Can the Economy be Left Alone', and What Happens if it is? The Issue of Equilibrium and Disequilibrium, and the Need for Macroeconomic Regulation 226

What is the 'Optimal' Outcome? Does the Market Reach the Optimal Outcome? And How do we Know it Did? The Criterion of 'Pareto Efficiency' 230

Are Market Outcomes Fair? Does Distribution Matter? 235

Does Private Power Create Sub-Optimal Outcomes? The Issue of Perfect and Imperfect Competition 240

Which Non-Market Preconditions do the Markets Require to Function? The Role of Institutions 244

Does Policy Matter? The Role of Non-Market Coordination 251

International Trade 255

Competing Views on Trade: Classical, Neoclassical and New Trade Theory 256

Dissent in Trade Theory 261

Is Trade Always Beneficial? 261

Does Trade Lead to Regional Convergence? 264

Growth and Prosperity 269

Intermediate Findings 276

5 Monetary Union, the Measures Enacted Since 2008 and the 'European Macroeconomic Constitution' 277

Introduction 277

Competing Socio-economic Views on the EMU 283

Reading the EU Treaty as a Pluralist Macroeconomic Instrument 288

Interpreting the Price Stability Rule in a Pluralist Form 289

Interpreting the Maastricht Rules in a Pluralist Form 294

Public Debt as a Controversial Issue 295

The Flexibility of the Debt Rules in the Light of Competing Views on Public Debt in Times of Crisis 297

Interpreting the Macroeconomic Imbalances Procedure in a Pluralist Form 308

Overview of the MIP 309

Different Socio-economic Perspectives on Macroeconomic Imbalances 310

The Pluralist Nature of the MIP Regulation 312

Application of MIP by the Commission: Scoreboard and Recommendations 314

Pringle: Interpreting Article 125 TFEU in a Pluralist Form 318

Gauweiler and the OMTs: Interpreting Article 123 TFEU in a Pluralist Form 326

The Pluralist Character of the Treaty in the Light of the Crisis Measures 329

Intermediate Findings 335

Conclusion 337

Bibliography 339

Index 365

Editorial Reviews

... the book is well-documented and characterized by a stimulating writing style, and worth reading for everyone wishing for a different and up-to-date approach to the economic constitution.” —Common Market Law Review

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