The Architecture of a ‘Social Market Economy’

24 Pages Posted: 4 Jun 2015 Last revised: 18 Aug 2015

See all articles by Floris de Witte

Floris de Witte

London School of Economics - Law School

Date Written: June 3, 2015


This paper traces the evolution of the nature of the EU’s internal market, from its origin in the 1950s to its current redesign in the aftermath of the Euro-crisis. It suggests that the relationship between ‘the market’ and ‘the social’ has shifted multiple times throughout the Union’s history. In the first stage, social policy was meant to complement the functioning of the internal market, and tease out potential economic asymmetries in the market. In the second stage, social policy became geared not towards levelling out conditions of competition in the market, but to explicitly protect the capacity of Member States to impose their understanding of ‘the social’ on the market. Finally, in the last decade, social policy on the Union level has started to move in the exact opposite direction. The EU’s institutions now understand social policy diversity throughout the EU no longer as a necessary complement for, but rather as inimical to, a functioning market in the EU. In doing so, however, they overlook a number of institutional asymmetries, normative biases and legal implications, which mean that any attempt to create a ‘social market economy’ – as Article 3 (3) TEU commits the EU to do – is bound to be distinctively light on ‘social’ and heavy on ‘market’.

Suggested Citation

de Witte, Floris, The Architecture of a ‘Social Market Economy’ (June 3, 2015). LSE Legal Studies Working Paper No. 13/2015, Available at SSRN: or

Floris De Witte (Contact Author)

London School of Economics - Law School ( email )

Houghton Street
London WC2A 2AE, WC2A 2AE
United Kingdom

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