For the upcoming conference in at CEPS in Brussels, we have drafted a Policy Brief summarizing the salient aspects of Eurozone Politics. The systematic empirical analysis based on our novel datasets – EMU Positions and EMU Formation – indicates that divided preferences, the unidimensional structure of policy conflict and dominance of executive actors present formidable obstacles to further reform. At the same time, the strong effect of structural economic factors on the determination of policy preferences, together with demonstrated EU capacity to negotiate balanced compromises provide an opening for gradual reform strategy. We derived four policy recommendations from this analysis of Eurozone politics:

  1. Support the convergence of policy preferences by reducing risks in banking sectors
  2. Continue developing gradual EMU reform designs
  3. Be prepared for crisis-induced EMU reforms
  4. Support innovative economic thinking