Measuring Economic Reform Recommendations under the European Semester: ‘One Size Fits All’ or Tailoring to Member States?

Abstract

In 2010 the European Semester was created to improve coordination of fiscal and economic policies within Europe's Economic and Monetary Union. The Semester aims to tackle economic imbalances by giving European Union (EU) member states country-specific recommendations (CSRs) regarding their public budgets as well as their wider economic and social policies with a view to enabling better policy coordination among Euro Area member states. In this article, we develop a method to assess the way in which the CSRs have been addressing coordination and offer a systematic analysis of the way they have been formulated. We offer a way to code CSRs as well as one to analyse progress evaluations. Furthermore, we seek to use our results to address one of the reoccurring questions in the literature: whether the EU is pursuing a 'one size fits all' approach to economic policy making in the Euro Area? The findings indicate that recommendations for different types of market economies among the Euro Area members tend to focus on different policy areas.

Political alternatives under European economic governance: evidence from German budget speeches (2009–2019)

“…From a domestic perspective, the increase of socially-oriented discourse under the fourth Merkel government seems to be largely driven by the partisan change in the finance ministry. However, from a European point of view, an important external factor to be taken into consideration are the Semester's CSRs, which from 2014 onwards have urged German governments to increase domestic expenditure (D'Erman et al, 2019;Zeitlin & Vanhercke, 2018). As anticipated in the Introduction, the contents of CSRs are to a great extent the result of negotiations between finance ministers (Maricut & Puetter, 2018).…”

“…Drawing on original data collection from finance ministers' national budget speeches, the paper shows how the political and policy content of German budgetary discourse between 2009 and 2019 changed under cabinets of different political composition. This change, however, also runs parallel to the 'socialisation of the European Semester', as recent country-specific recommendations (CSRs) have called upon German governments to make use of the state's fiscal surplus and to increase domestic expenditure (D'Erman et al, 2019;Zeitlin & Vanhercke, 2018). Consequently, the paper explores the origins of the government's most recent expansive policy proposals, showing that these were domestic political initiatives that were subsequently incorporated in the EU's CSRs.…”

“…Recent empirical research, however, highlights how the reform of EEG was largely the result of intergovernmental negotiations, wherein one coalition of member states asserted its political preferences for economic governance (Wasserfallen et al, 2019). In addition, there is increasing evidence showing that the European Semester does not only promote sound public finances, but also provides tailor-made recommendations for countries to improve their social security provisions (D'Erman et al, 2019;Zeitlin & Vanhercke, 2018). Finally, and perhaps most importantly, intergovernmental negotiationsparticularly among finance ministersplay a dominant role in the definition of the Semester's policy priorities (Maricut & Puetter, 2018).…”

Is Austrian budgetary policy still “political”? A cross-time comparison of budget speeches

“…Instead, it should feature more discourse about fiscal consolidation justified with arguments about institutional commitments. Furthermore, following this argument, if during the 2010s the budget speeches do feature political justifications for fiscal stimulus policies, these are responses to the European country-specific recommendations, which are not exclusively about public deficit levels, but may at times also urge governments to for example improve social security provisions (D'Erman et al 2019). In our analysis, we therefore also investigate whether the policy choices made during the 2010s appeared first in the political platforms of the governing parties or in the European recommendations.…”

Super Mario 2: comparing the technocrat-led Monti and Draghi governments in Italy

“…As documented by recent research, during the last decade, European recommendations have shifted from the heavy focus on austerity of the 2011 to 2014 period, to the socially oriented focus of the period since then, this thanks to the more active involvement of the EU's social and employment policy actors (D'Erman et al 2019;Haas et al 2020;Zeitlin and Vanhercke 2018). This over-time difference in the contents of CSRs is also evident in the case of Italy.…”