The European Court of Justice as an Engine of Economic Integration: Reconsidering Evidence that the ECJ has Expanded Economic Exchange in Europe

Abstract

Membership in the European Union involves a commitment to economic liberalization regarding the movement of goods, services, capital, and labor. But what the treaty articles and secondary legislation mean in practice - particularly when brought into conflict with national laws, depends on judicial interpretation by the European Court of Justice (ECJ). Stone Sweet and his collaborators (Stone Sweet 2004; Stone Sweet and Brunell 1999; Fligstein and Stone Sweet 2002; Stone Sweet and Caporaso 1998) argue that the European Court of Justice's rulings have played an important role in completing the internal market through market liberalizing rulings. Specifically, they argue that the increased use of the preliminary reference procedure over time provided the ECJ with greater opportunities to rule on the validity of national barriers to free movement and this in turn produced increasing exchange of goods among the member states. I test this proposition with a novel dataset. The results indicate that, on average, market liberalizing rulings on preliminary references system. Moreover, this effect is not among the EU member states.

Keywords: European Court of Justice, Trade Economy