Differentiated Economic Integration: Saving or Destroying the European Project?

Friday, July 14, 2017
John McIntyre - Room 201 (University of Glasgow)
Anita Pelle , Faculty of Economics and Business Administration, University of Szeged
In the early times, steps of economic integration were constructed and realised so that all members agreed on them and then achieved them jointly. However, with subsequent enlargements and increasing heterogeneity, this mode of functioning was no more evident. The first solutions showing in the direction of differentiated economic integration occurred already with the 1973 enlargement.

Integration theory distinguishes between graduated and differentiated integration: the former refers to the same steps taken but at different speeds, taking members’ diverse circumstances and capabilities into account, while the latter inherently acknowledges that member states take different paths and they do that consciously, with the consent of the others.

Perhaps the most crucial such moment so far has been the amendment of the Maastricht Treaty with the opt-out clause in relation to the United Kingdom and Denmark. Nevertheless, there are numerous other manifestations of differentiated economic integration in the history of European integration: the UK’s special position on the revenue side of the EU budget, the subsequent discretionary decisions under the Stability and Growth Pact and the Excessive Imbalance Procedure, the non-signature of the Fiscal Compact by some member states, etc.  

The institution of differentiated integration was originally introduced with the aim of keeping the Community together and satisfy the special needs or requests by certain members in parallel. Paradoxically, the impact may well be just the opposite as, already in the medium term, the room provided for such maverick behaviour compromises joint decision-making and enforcement, and thus undermines the common establishment overall.

Paper
  • CES 2017.pdf (2.6 MB)