Yields of the Economic Crisis of 2008 for the EU: From Economic Policy Coordination to Economic Governance

Abstract

The global financial crisis starting in 2008 found the economy of the EU unprepared. Member States reacted to the globally-rooted asymmetric economic shocks in a vastly differing way. Previously accepted coordination mechanisms were proven ineffective in mitigating crisis effects and upholding stable institutional functioning. Thus various institutional reforms were implemented due to the lasting consequences of the crisis, mostly focusing on modernising the Stability and Growth Pact. However, modernising attempts faced partial or general indifference of member states, rendering ratification partial, as well. Th e present study analyses reform steps preparing for the introduction of economic governance, also pointing out that the modernisation of economic coordination only resulted in partial success as the Commission’s modernising eff orts feebled with
the fading away of the crisis.