The Rise and Fall of Merkozy: Franco‐German Bilateralism as a Negotiation Strategy in Eurozone Crisis Management

Abstract

The close co‐operation between French President Sarkozy and German Chancellor Merkel (‘Merkozy’) dominated a significant part of eurozone crisis management. Yet, after the election of a new French government in 2012, the Franco‐German co‐operation in the Economic and Monetary Union deteriorated. This article asks why the Franco‐German tandem got stuck. Drawing on bargaining theory, it argues that Germany used ‘Merkozy’ as a negotiation strategy to further its aims in eurozone crisis management. However, when the preferences of the two countries were no longer reconcilable due to changes in France as well as in the negotiation environment, the strategy failed. Thus, while much of the literature has focused on the persistence of the Franco‐German partnership, this approach accounts for variation in its functioning. The results provide an explanation for the rise and fall of Merkozy and bear implications for assessing the future Franco‐German relationship.

European Monetary Union reform preferences of French and German parliamentarians

“…From the start of the European integration process, Germany and France have been seen as the ‘engine’ of integration (Krotz and Schild, 2013). This holds in particular for monetary integration steps such as the European Monetary System as of 1979, the EMU 20 years later (Marsh, 2010), and during the management of the euro crisis between 2010 and 2012 (Degner and Leuffen, 2019; Schoeller, 2018). From this perspective, a Franco-German agreement can be regarded as necessary (albeit not sufficient) condition for any further EMU reform.…”

The contested nature of political leadership in the European Union: conceptual and methodological cross-fertilisation

“…With the fall of the Berlin Wall in 1989 and the resulting reshuffle of the balance of power in the EU, students of EU leadership became interested in Germany's new role as a, or even 'the', leading power in Europe (Bulmer and Paterson 1996;Kaelberer 1997). Other scholars have taken a slightly broader focus and asked to what extent the French-German tandem is (still) able to steer EU policy (Krotz and Schild 2013;Schild 2010;Schoeller 2018). In light of Germany's performance in the Eurozone and refugee crises, the question of Germany's hegemonic role re-emerged, further stimulating this field of research (Bulmer and Paterson 2013;Otero-Iglesias 2017;Paterson 2011;Schoeller 2016).…”

“…T€ ommel and Verdun 2017). A lot of research focusses on leadership during times of crisis (Hodson 2013;Nielsen and Smeets 2017;Schoeller 2018;Van Esch 2014;Van Esch and Swinkels 2015). However, while research on the performance of EU actors in specific policy domains and situational settings has been widespread, such studies seldomly explicate the connection between leadership and context or make use of the insights and theories developed in leadership studies.…”

Collaborative leadership in EMU governance: a matter of cognitive proximity

“…Following a transactional quid pro quo reasoning, these scholars reason that due to the difference in their positions, the views of the German chancellor and French president may actually represent the interests and beliefs of a wider subset of EU member states. This allows them to factually act as the spokespeople of a wider set of states, thereby facilitating compromise among a larger group of member states (Schild 2010;Schoeller 2018;Webber 1999). Although this branch of thought departs from a different, transactional perspective and focusses on cooperation rather than collaboration, it does raise the question of whether belief proximity is indeed necessary for successful collaborative leadership to emerge.…”