AØKA08081U Economics of the European Union (EU)

This is an introductory course on the economics of the European Union focusing on main economic and legal aspects of European integration as well as its policies. The course covers the historical development of the EU; regional cohesion, and competition policies; labor mobility and migration; the Common Agricultural Policy (CAP); monetary unification and the impact of the single currency; the common monetary policy in the euro area; and fiscal policy within a monetary union. In addition to these topics, the course also covers recent developments in the EU including the euro crisis and the policy response to the crisis.

The course is divided into three parts. The first part will cover the historical, political and institutional foundations of European economic integration including the role of the European Commission, the European Parliament and the Councils of Ministers.

The second part focuses on current issues including the euro crisis. First, we consider the micro and macroeconomic aspects of monetary integration. Starting with the theory of optimum currency areas, we analyze the economic and institutional aspects of the European Monetary Union, including the Stability and Growth Pact, Fiscal Compact and Banking Union. Then we turn to the current financial crisis in Europe focusing on the banking crises in Ireland and Spain and the Greek debt crisis. The policy responses to these crises are also discussed including the question whether these policies can resolve the crises and prevent future crises.

The third part analyzes European integration from a microeconomic perspective focusing on the effects of integration on economic growth, both at a national and a regional level. Key topics include the Common Agricultural Policy and the Rural Development and Regional Policy funded by the European Union. In addition, to these topics, we also discuss labor market policies, the European social model and flexicurity, and labor migration.