Building a Better Union: Incentivizing Structural Reforms in the Euro Area

42 Pages Posted: 27 Nov 2015

See all articles by Angana Banerji

Angana Banerji

International Monetary Fund (IMF)

Bergljot Barkbu

International Monetary Fund (IMF)

James John

International Monetary Fund (IMF

Tidiane Kinda

International Monetary Fund (IMF)

Sergejs Saksonovs

International Monetary Fund (IMF)

Hanni Schoelermann

International Monetary Fund (IMF)

Tao Wu

International Monetary Fund (IMF)

Date Written: September 2015

Abstract

The momentum for structural reforms is waning in the euro area at a time when even faster progress is needed to boost productivity and growth, achieve real economic convergence, and improve the resilience of the monetary union. What can the European Union (EU) institutions do to bridge this divide? This paper argues for greater simplicity, transparency and accountability in the EU governance framework for structural reforms. Our three interrelated proposals-'outcome-based' benchmarking; better use of existing EU processes to strengthen oversight and reduce discretion; and improved financial incentives-could help advance reforms. Ex post monitoring by an independent EU-level 'structural council' and ex ante policy innovation by national productivity councils could strengthen accountability and ownership. Deeper governance reforms should be considered in the medium-term with a view toward a greater EU role in promoting convergence.

Keywords: Structural reform, European economic governance, governance, states, member states, legislation, fiscal, Planning, Coordination, and Reform, Intergovernmental Relations,

JEL Classification: -;- P11, P11, P16, P16, H77, H77

Suggested Citation

Banerji, Angana and Barkbu, Bergljot and John, James and Kinda, Tidiane and Saksonovs, Sergejs and Schoelermann, Hanni and Wu, Tao, Building a Better Union: Incentivizing Structural Reforms in the Euro Area (September 2015). IMF Working Paper No. 15/201, Available at SSRN: https://ssrn.com/abstract=2696061

Angana Banerji (Contact Author)

International Monetary Fund (IMF) ( email )

Bergljot Barkbu

International Monetary Fund (IMF) ( email )

700 19th Street, N.W.
Washington, DC 20431
United States

James John

International Monetary Fund (IMF ( email )

700 19th Street, N.W.
Washington, DC 20431
United States

Tidiane Kinda

International Monetary Fund (IMF) ( email )

700 19th Street, N.W.
Washington, DC 20431
United States

Sergejs Saksonovs

International Monetary Fund (IMF) ( email )

700 19th Street, N.W.
Washington, DC 20431
United States

Hanni Schoelermann

International Monetary Fund (IMF) ( email )

700 19th Street, N.W.
Washington, DC 20431
United States

Tao Wu

International Monetary Fund (IMF) ( email )

700 19th Street, N.W.
Washington, DC 20431
United States

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