The EU and the Global Financial Crisis

The EU and the Global Financial Crisis

New Varieties of Capitalism

New Horizons in European Politics series

Christian Schweiger

This authoritative book offers a complete breakdown of the EU’s political economy in the wake of the global financial crisis and will therefore appeal to students of European politics, international political economy and European studies, as well as policy-makers and other stakeholders.

Chapter 2: From deregulation towards 'smart' regulation

Christian Schweiger

Subjects: economics and finance, political economy, politics and public policy, international politics, political economy


The ambition to create an integrated economic area has always been at the heart of the European integration. Ever since the process of the institutionalised pooling of national sovereignty began in Europe, economic integration has been paramount and political integration followed slowly and with great hesitation. The move from the pooling of sovereignty in individual economic sectors, coal and steel in 1951, towards the establishment of a Common Market in the Treaty of Rome in 1957 was initially considered to be part of a functionalist process of 'spillover' from the economic into the political field. Neofunctionalist theories assumed that in order to successfully introduce the deregulatory regime of the Common Market with the aim of the free movement of goods, people, capital and services, member states would inevitably have to agree to give increasing control to Brussels over their domestic policies (Haas 1958: 313). This was supported by the principles which the Treaty of Rome determined for the Common Market. They went clearly beyond creating a free trade area and emphasised the need for 'progressively approximating the economic policies of the member states' (European Economic Community 1957, article 2). This ambitious goal may have seemed realistic at the time of the signing of the Treaty, when participating member states seemed to be convinced that they could create an 'ever closer union'.

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