Non-state actors and the making of Europe's Economic and Monetary Union (EMU)

July 25^th 2022

PA.122 | Non-state actors and the making of Europe's Economic and Monetary Union (EMU)

Parallel Sessions

14:30 - 18:00 - Recherche Sud - Room 0.030

Description

Analyses of the making of European Economic and Monetary Union (EMU) have largely focused on interstate bargaining and idealistic narratives about 'the saints of European integration', as Alan Milward sarcastically called them thirty years ago. This panel, by contrast, studies the contribution of non-state actors to the debates about EMU from the 1960s to the 1990s. Were they supportive, indifferent to, or against EMU, and why? What was the actual contribution of non-state actors to policy discussions, and did they participate through lobbying broadly speaking, or the co-production of norms? How did they try to coordinate their views to increase their influence? Did non-state actors push for proposals that were alternative to those being designed among governments? And what challenges does the influence of non-state actors raise in terms of democratic legitimacy? Our answers to these questions reveal just how diverse, complex, and multi-faceted the debates were around economic and monetary integration in Europe, and they equally open new lines of economic historical research on the power of non-state actors to shape intergovernmental economic coordination. This panel brings together researchers of the ERC-funded project EURECON, with other scholars interested in the topic. Papers cover the contributions of banks, trade unions, business, as well as economic thinking into the making of EMU. They cover a wide range of national and comparative case studies, including France, Italy, Germany, and the United Kingdom. Panel organiser: Emmanuel Mourlon-Druol (University of Glasgow) 1st session: businesses and banks Grace Ballor (Bocconi University): Business Eurosceptics: British Industry on Economic and Monetary Union Aleksandra Komornicka (University of Glasgow): Business circles in the run-up to Maastricht: the campaign of the Association for the Monetary Union of Europe, 1987-1992 Simon Baudraz (Université de Genève) and Sabine Pitteloud (Harvard Business School): Third-country businesses and the making of Europe’s Economic and Monetary Union: the agenda and influence channels of Swiss MNEs Alexis Drach (University Paris 8) and Aleksandra Komornicka (University of Glasgow): The forgotten currency: the European Currency Unit private market and European Integration 2nd session: economic thinking and trade unions Dorothea Todd (University of Glasgow): Ordoliberalism and EMU: economic policy coordination in the European Economic Community (EEC) in the 1960s Aurélie Andry (Université d'Evry Paris Saclay): French and Italian trade unions, EMU and the ‘social union’ in the long 1970s Marvin Schnippering (University of Glasgow): The German Trade Union Confederation's (DGB ) vision of European cooperation and the creation of a social and democratic EMU Discussant: Eric Monnet (EHESS)

Thematics

B - History of Economic Thought, Methodology, and Heterodox Approaches

B2 - History of Economic Thought since 1925

B3 - History of Economic Thought: Individuals

J - Labor and Demographic Economics

J51 - Trade Unions: Objectives, Structure, and Effects

N - Economic History

Organizer(s)

Mourlon-Druol Emmanuel

Discussant(s)

Eric Monnet - Paris School of Economics (PSE)

Papers

Business Eurosceptics: British Industry on Economic and Monetary Union

Grace Ballor - Bocconi University

Brexit and its aftermath have renewed efforts to understand the evolution of Britain’s “special relationship” with the European Community and Union and to study the complex history of Euroscepticism in the United Kingdom. This paper examines the perspectives of British businesses on one of the core dimensions of European integration: the Economic and Monetary Union (EMU). Drawing evidence from the archives of the Confederation of British Industry (CBI), it finds that while British businesses strongly supported regional market integration throughout the 1980s and 1990s, they expressed increasing skepticism about the EMU, especially after Britain crashed out of the Exchange Rate Mechanism (ERM) on Black Wednesday in 1992. Survey data from British businesses reveals that perspectives on the EMU differed across firm sizes and sectors, but their collective ambivalence-turned-resistance to regional economic policies and a single currency was largely reflected in the position of the British government.

Big business associations and EMU: towards the Association for the Monetary Union of Europe, 1946-1992

Aleksandra Komornicka - University of Glasgow

Created in 1987 and by 1992 including over 200 European companies, the Association for the Monetary Union of Europe (AMUE) often serves as proof of business' support for monetary and economic integration and its engagement in pushing this agenda forward. This paper undermines this picture by offering a long-term view on debates on Economic and Monetary Union (EMU) in the European business association. It places the AMUE among other European business associations such as the European League of Economic Cooperation (ELEC), the Union of Industrial and Employers' Confederations of Europe (UNICE), and the European Round Table of Industrialists (ERT) and reveals that, unlike other European projects, EMU and its design always caused controversies among business associations and their members. Consequently, these actors only responded to political proposals, never pro-actively advocating a specific agenda.

Third-country businesses and the making of Europe’s Economic and Monetary Union: the agenda and influence channels of Swiss MNEs

Sabine Pitteloud - Harvard University

Simon Baudraz - Université de Genève

The concretization of the EMU in the 1990s would not only impact businesses from member states but would have significant consequences for third-country multinational enterprises (MNEs) as well. Such observation certainly stands for several large Swiss MNEs which had established many subsidiaries in the Common Market and which simultaneously still exported large share of their production carried out within Switzerland to EEC countries. Trade flows (exports, imports and intra-firms trade) and financial flows (FDI, transfer pricing, licensing fees, repatriation of profits) would indeed be impacted by the future structure and the rules of the EMU, as well as the relative strength and stability of the common European currency. This paper analyzes Swiss MNEs’ political agenda for the EMU and their information and influence channels. The analysis draws on various Swiss business interest associations’ archives and on the personal papers of business representatives, and relies on Frieden theoretical framework to assess the preferences of various business sectors regarding the exchange rate regime and the exchange rate level.

The forgotten currency: the European Currency Unit private market and European Integration

Alexis Drach - Université Paris 8

Aleksandra Komornicka - University of Glasgow

Created as a part of the European Monetary System in 1979, the European Currency Unit (ECU) basket currency aimed to provide shelter against the fluctuating exchanges and stimulate trade between the members of the European Economic Community. In the minds of supporters of the European monetary integration, the wide use of the ECU could lead to the European Economic and Monetary Union (EMU). Since the early 1980s, the new currency dynamically entered the secondary bond market, became a popular leading currency, and a new form of a denomination in internal companies’ transactions. By 1991 the ECU was already the world fifth largest traded currency. This paper explores this 1980s forgotten ECU private market in the context of European integration. Applying the perspective of European banks and businesses, it sheds light on the motivations behind using a European basket currency. The study integrates the traditional business history approach with the research on non-state actors and European Integration. On the one hand, ECU was one of many new financial innovations of the 1980s which was used in the name of economic profit. On the other hand, enlarging ECU private market sent a clear signal of support for the European monetary integration and motivated European policymakers to back the new currency with institutional and political arrangements. As previous studies on the European business actors in the 1980s revealed, in this period, the progress of European integration was high on their agenda. By looking at cases of use of ECU in private transactions, the paper assesses the relationship between the emergence of the ECU market and the businesses and banks’ support for the looming project of EMU. The study relies on the research of the archives of European business associations (European League for Economic Cooperation, Association for the Monetary Union of Europe, British Bankers’ Association, European Banking Federation) as well as specific banks (Barclays, Midland, Lloyds, Crédit Lyonnais, Société Générale, BNP) and companies (Fiat, Saint Gobain). Bringing in banks and businesses in one paper provides additional insight into similarities, differences, and interdependence between them when facing EMU.

Ordoliberalism and EMU: economic ideas and economic policy coordination in the European Economic Community (EEC) in the 1960s

Dorothea Todd - University of Glasgow

Ordoliberalism, it is often claimed in academic and public discourse, has thoroughly shaped European monetary and economic policies. This paper explores the influence of ordoliberalism on the European economic integration by looking at the short-term and the mid-term economic policy committee of the European Commission. Both committees were based on article 6 of the Treaty of Rome, calling for coordination of the economic policies of the member states of the European Economic Community (EEC). The committees , which have not yet been studied in depth, were platforms where competing economic theories were discussed by the member states of the European Economic Community (EEC). This paper investigates the formation and early years of the two committees, that, being created following a German and a French initiative, arguably represent the conflicting ideas of the two most influential members of the early EEC and therefore offer interesting case studies of the contested influence of ordoliberalism on the early debates of European economic integration. It will show that ordoliberalism was not as dominant as assumed, but rather that it contained the influence of other economic ideas in the EEC.

French and Italian trade unions, EMU and the ‘social union’ in the long 1970s

Aurélie Andry - Université d'Evry Paris Saclay

During the ‘long 1970s’ that stretched between the late 1960s and the early 1980s, in a context of erosion of the postwar compromise and delegitimating of the Keynesian welfare state that came both from the great social contestation and from the post-1973 economic crisis, the European Left—starting with European trade unions—tried to promote an alternative vision of European unity. To serve the interests of the workers and not just of capital, they believed, economic integration needed to go hand in hand with social integration. As European leaders decided to revive European integration and work towards the creation of economic and monetary union (EMU) at the Hague Summit in 1969, they insisted that the realisation of EMU be conditioned upon the realisation of a ‘social union’. This paper investigates European trade unions’ positions regarding the perspective of EMU and the European Monetary System, and tries to assess how they attempted (and failed) to build social mobilisation at transnational level to defend a project for a ‘workers’ Europe’ during the long 1970s. It does so with a particular attention to the ETUC, as well as French and Italian unions, who were especially engaged in promoting a combative attitude for the promotion of workers’ interests at the European level.

The German Trade Union Confederation's (DGB ) vision of European cooperation and the creation of a social and democratic EMU

Marvin Schnippering - University of Glasgow

July 25th 2022