EU Economic Governance and the COVID-19 Crisis: Between Path-Dependency and Paradigmatic Shift

Abstract

The COVID-19 pandemic and the dramatic recession that ensued, have precipitated new and ambitious economic and monetary policy initiatives at the European Union level. This article takes stock of the measures taken thus far and reflects on the impact of the ongoing crisis on the Eurozone’s political economy and its paradigms. It addresses the continued dominance of the European Central Bank; the emergence of a fiscal center in the Eurozone; and the role of the State in the economy more generally, as well as the place of Europe in the world economy. The article argues that the European response to the economic recession associated with the pandemic is marked both by continuity and path-dependency on the one hand, and potential paradigmatic shifts on the other hand.