Peter Loedel

The euro, economic interests and multi-level governance: Examining support for the common currency

Support for a common currency and the European Monetary Union signifies that European citizens are willing to transfer power from the nation-state to the European Union (EU). Given the symbolic importance of national currencies, this willingness to give up sovereignty over currency has important implications for the further integration and development of the European Union. Drawing on a multi-level governance perspective and past research into public support for European integration, we examine how economic factors such as the value of the national currency and individual factors such as diffuse support for the EU and education condition support for the euro. We hypothesize that citizens will be less likely to support a common currency when they lack diffuse support for the EU, when their own national currency is strong or when their countrys domestic agenda is squeezed by austerity measures. Using pooled Euro Barometer data from 1992 to 2000, we find support for these hypotheses indicating that citizens take into account domestic economic performance when evaluating EU institutions, but we also find that individual attitudes toward the EU play a role in support for the euro.

Stimulating Simulations: Making the European Union a Classroom Reality

This article examines the organization and development of the Mid-Atlantic European Union Simulation Consortium (MEUSC), with special emphasis on linking theory to practice within its simulation program. The MEUSC program, initiated in 1993, brings fifteen colleges and universities to Washington, D.C., each December for an intercollegiate experiential learning exercise on the European Union. During the simulation, students meet with professional diplomats from both the United States and Europe, and they engage in consensus-building activities that mirror the decision-making processes of the EU Commission, Parliament, Council of Ministers, and the European Council. As a result, participants are able to refine and enhance a range of academic and practical skills that are keys for success in todays political and business worlds. The authors of this article make special use of a survey that was undertaken to gauge the impact of the simulation on its participants and, thus, its success as an educational venture.

Economic interests and public support for the euro

Although economic theories have been advanced to explain public support for the common currency, we know very little about how public support for the euro has been affected by its economic impact. We hypothesize that concern about rising prices following the introduction of the euro may have dampened enthusiasm for the project. We use Eurobarometer data from 2000–2007 to examine how rising prices and other economic factors have shaped support for the euro. We find that while inflation has had a negative impact on support for the euro, this is offset by the positive effect of diffuse support for the European Union. This support, along with the impact of a strong currency, has led most (approximately two-thirds) of Europeans to be generally positive about the euro.

EU Simulations and Engagement: Motivating Greater Interest in European Union Politics

ABSTRACT While the effects of simulation-based courses on the knowledge of participating students may be marginal in relation to standard lecture and discussion-based courses, this article argues that the greatest leverage is gained by increasing participating students’ level of interest in the subject of study and in politics more broadly. Participants tend to become increasingly absorbed in their roles and in the politics of the institutions at the center of the simulation. To better consider this possibility, we conducted a survey of students participating in the 2015 Mid-Atlantic European Union Simulation and of appropriate control populations. The survey results indeed suggest that, much more than simply acquiring knowledge about the EU, the simulation experience serves to generate more robust interest in the subject of study.

The Costs and Benefits of Organizing a Multi-institutional Simulation on the European Union

While much research has been conducted on the use of political simulations and other active learning experiences in the classroom environment, there has been little scholarship about multi-institutional simulations such as Model UN and Model EU. This chapter examines the organization and learning outcomes of one such simulation, the 25-year-old Mid-Atlantic Model EU (MEUSC). The complexity of the MEUSC simulation and the logistical issues related to convening several institutions in Washington, D.C. each year require a strong commitment from the participating faculty. Yet, the MEUSC organizers believe that the benefits of the simulation more than outweigh the costs. Prior assessments of the simulation outcomes, including a pre-/post-survey instrument launched in 2015, offer some support for this belief. These assessments suggest that students learn as much or more about the EU than they would from a traditional lecture environment. Perhaps more importantly, participating in the simulation appears to engender greater interest in the EU. The faculty organizers remain engaged in ongoing efforts to assess the effects of multi-institutional simulations.

Conclusion: the ECB and the Future of Europe

The primary objective of this book was to provide a theoretically and historically rich study of the institutional structure and operation of the ECB. In doing so, we have highlighted the historical transformation toward EMU, the institutional set-up of the ECB, and the bank’s independence. We have also evaluated the monetary interests and preferences of key EU member states — Germany, France and the United Kingdom — toward EMU and the ECB. Finally, we briefly analysed the short history of ECB policy-making with a focus on the overarching credibility of the ECB.

Analytical and Theoretical Approaches to the Study of the European Central Bank

As scholars of the process of European integration, we are aware of the limitations and deficiencies of the state of theory in international relations and comparative politics. Susan Strange’s dissatisfaction with the state of theorizing should warn us of the dangers and pitfalls of employing too deterministic a mode of theoretical analysis. The diversity of theories and analytical approaches at our disposal makes the task even more problematic. Europeanist Gary Marks has noted that studying the European Union asks ‘us to think anew about political science as a discipline and how its subfields fit together’ (Marks 1997: 1). Scholars have been debating the validity of different theoretical approaches since the late 1950s (for a review of the international relations and comparative politics/political economy approaches see Bulmer and Scott (1995) and Rosamond (2000)). Notable works on European Monetary Union (for example, Overturf 1997; Kenan 1995; McNamara 1998; Frieden, Gros and Jones 2000; Eichengreen and Frieden 2001) provide a comprehensive review of various theoretical approaches to the study of monetary integration.

A Question of Credibility: a Short History of ECB Monetary Policy

As noted in the previous chapter, credibility centres on whether and how central bankers can make credible commitments about their future conduct. Importantly, central bank independence and the credibility that flows from it needs to be understood in terms of actual policy and behaviour. It is one thing to proclaim a central bank independent — and, as we have demonstrated, the ECB maintains high levels of independence. It is another thing to proclaim the central bank’s policies credible. Monetary policy credibility must be measured over time and must be evaluated in terms of the monetary policies and behaviour of the bank. Moreover, the structure of the economy and internal politics may present the ECB with difficult tradeoffs between short-run policy benefits and long-run policy costs that may have an impact upon credibility. Such tradeoffs present the central bank with difficult policy choices that will be analysed in minute detail by politicians and markets alike. Such choices are the basis of evaluating central bank credibility.