English
 
Help Privacy Policy Disclaimer
  Advanced SearchBrowse

Item

ITEM ACTIONSEXPORT

Released

Journal Article

Fiscal Fault, Financial Fix? Capital Markets Union and the Quest for Macroeconomic Stabilization in the Euro Area

MPS-Authors
/persons/resource/persons181110

Braun,  Benjamin
Soziologie des Marktes, MPI for the Study of Societies, Max Planck Society;

/persons/resource/persons200391

Hübner,  Marina
International Max Planck Research School on the Social and Political Constitution of the Economy, MPI for the Study of Societies, Max Planck Society;

External Resource
Fulltext (public)

C&C_22_2019_Braun.pdf
(Any fulltext), 352KB

Supplementary Material (public)
There is no public supplementary material available
Citation

Braun, B., & Hübner, M. (2018). Fiscal Fault, Financial Fix? Capital Markets Union and the Quest for Macroeconomic Stabilization in the Euro Area. Competition & Change, 22(2), 117-138. doi:10.1177/1024529417753555.


Cite as: http://hdl.handle.net/21.11116/0000-0000-7F01-1
Abstract
This article seeks to situate and explain the European Union’s push for a Capital Markets Union – and thus for a more market-based financial system – in the broader context of macroeconomic governance in politically fractured polities. The current governance structure of the European Monetary Union severely limits the capacity of both national and supranational actors to provide a core public good: macroeconomic stabilization. While member states have institutionalized fiscal austerity and abandoned other macroeconomic levers, the European polity lacks the fiscal resources necessary to achieve stable macroeconomic conditions – smoothing the business cycle, ensuring growth and job creation and mitigating the impact of output shocks on consumption. Capital Markets Union, we argue, is the attempt of European policymakers to devise a financial fix to this structural capacity gap. Using its regulatory powers, the Commission, supported by the European Central Bank (ECB), seeks to harness private financial markets and instruments to provide the public policy good of macroeconomic stabilization. We trace how technocrats, think tanks, and financial-sector lobbyists, through the strategic use of knowledge and expertise, established securitization and market-based finance as solutions to the European Monetary Union’s governance problems.