Political Idealism and Economic Realism: A Forced Marriage to Preserve the Eurozone

Revue Bancaire et Financière (Bank- en Financiewezen), vol. 4, 215-223, 2012.

11 Pages Posted: 21 Jan 2021

See all articles by Mikael Petitjean

Mikael Petitjean

Catholic University of Lille - IÉSEG School of Management, Lille Campus; Lille Economie & Management (LEM) UMR 9221; Louvain School of Management (UCL); Catholic University of Louvain (UCL) - Louvain Finance (LFIN)

Date Written: September 2012

Abstract

Political idealism has prevailed over economic realism in the EU decision process. As a result, today’s Eurozone is a puzzle with too many missing pieces. Given the severity of the crisis, policymakers would be well advised to urgently take both structural and pragmatic measures to preserve the Eurozone, as proposed in the paper. Although the discussion about the right balance between fiscal rectitude and support for demand is useful, the fundamental challenge for Europe is to rethink the ‘welfare state’ model that has prevailed over the past 50 years or so. Political idealism can no longer ignore the significant intergenerational economic constraints that Europe faces today in a world in which it can no longer dictate the terms of exchange. What Europe desperately needs is a new and realistic vision for the 21st century.

Keywords: Eurozone crisis, financial regulation, structural measures, stability

JEL Classification: G00, G01, G28

Suggested Citation

Petitjean, Mikael, Political Idealism and Economic Realism: A Forced Marriage to Preserve the Eurozone (September 2012). Revue Bancaire et Financière (Bank- en Financiewezen), vol. 4, 215-223, 2012., Available at SSRN: https://ssrn.com/abstract=3769188

Mikael Petitjean (Contact Author)

Catholic University of Lille - IÉSEG School of Management, Lille Campus ( email )

3 rue de la Digue
Lille, 59000
France
0032497301266 (Phone)
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Lille Economie & Management (LEM) UMR 9221 ( email )

Lille
France

Louvain School of Management (UCL) ( email )

Belgium

Catholic University of Louvain (UCL) - Louvain Finance (LFIN) ( email )

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Louvain-la-Neuve, 1348
Belgium

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