Northwestern University – Sciences Po European Affairs Program

The Political Economy of the European Union Francesco Saraceno Fall 2013

Course Description The course aims at familiarizing the students with the most important controversies regarding the European economy, its attitude towards a globalized world, and the coordination devices put in place by the Treaties that rule the institutions of the continent. The term “controversies” is used on purpose because, on most of the issues regarding the economy of the European Union, we are far from witnessing a consensus in the academic community, as well as among policy makers. Accordingly, after a few introductory classes, the course is organized as a series of “debates” in which after an introduction by the teacher, students will confront their ideas on particular subjects regarding the European Economy.

Organization of the Course The course is designed in order to make sure that students provide a continuous amount of effort throughout the semester. The first classes will be in the traditional lecture format, and will provide the students with a general framework of analysis. I will first give a short outline of the genesis of the European Union; a lecture on the institutions dedicated to the economic government of Europe and the visit to Jean Monnet’s house will complement this historical account. Then, I will describe the main developments in the history of economic thought, that underlie the big theoretical controversies on unemployment, growth etc.

After this introductory part, the core of the course will be represented by a number of debates on controversial economic policy issues, in which the students will be required to form an opinion. Each week I will introduce the theme of the debate for the following class, and give a list of readings that will serve as a basis for the discussion. Students will be required to complement these basic readings through their own bibliographic research. The following week I will moderate the debate, which will be introduced by a small group of students with powerpoint presentations. To ensure that the debates will be lively, I will split the students in two groups. The group composition will be given duringhte first two weeks of classes.

Evaluation The evaluation will be based on three elements: -

Class participation (40%) This includes the participation to the debates, the ability in putting together the additional bibliography, and the presentations.

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Midterm exam (30%) October 3rd The midterm exam consists of a multiple choice test and short take home exam

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Final Exam (30%) December 12th The final also consists of a multiple choice test and a few questions

Course Information and Material The main reference for my class is the course webpage, where you’ll find all the material related to the class, including guidelines for the debates. There I will also post optional readings, as well as last minute changes in the program. http://fsaraceno.free.fr/nusp.html As the debate on all the topics is continuously evolving, the reading list will be updated as I (or you?) discover new interesting material. I suggest that during the class period you follow my twitter account (@fsaraceno) that I use to spread interesting material I find about economics of the European Union. Finally, please feel free to feed the facebook group (NUSP2013) with material and info on our and the other classes, as well as material on the EU and why not on Paris and France!

Office Hours By appointment ([email protected], or 01 44 18 54 93). My office is at OFCE, 69 Quai d’Orsay, 75007 Paris, Bus #63, stop Église américaine.

Course Schedule Always look at the program for class times and room numbers, which vary all the time! The classes will run for 2.5 hours. Class 1

Lecture: The Making of the European Union: A Short Historical Account

Class 2

Lecture: The Evolution of Economic Thought I

Class 3

Lecture: The Evolution of Economic Thought II

Class 4

Field Trip: Visit to Jean Monnet House

Class 5

Lecture: Institutions for EMU Economic Governance

Class 6

Lecture: Welfare State Reform. Joint with the HP program

Class 7

Midterm (October 3rd)

Class 8

Debate: Europe is now a Currency Area. Is it also Optimal? Group 1: Abby Reudelsterz Maddie Stuart Group 2: Alexander Smith Sylvia Chai

Hugo Lhuillier Olga Tymouch

Class 9

Debate: The European Central Bank (ECB). Too Much Inflation? Too Much Independence? Group 1: Amy Li Morgane Lerville Eric Sadler Group 2: Florentine Brossier Tracy Lin Oskar Melking

Class 10

Debate: The Stability and Growth Pact (SGP). Necessary Instrument for Fiscal Discipline, or Unnecessary Straightjacket? Group 1: Ani Christianian Rebecca Abers Katherine Branigan Group 2: Geoffrey Besnier Madeline Kriger Sylvia Chai

Class 11

Debate: US vs. EU. What are the Reasons for Such a Different Economic Performance? Group 1: Arkar Hein Amy Li Maddie Stuart Group 2: Kate Cobb Mary Kate Binecki Olga Pototskaya

Class 12

Debate: Trade and the WTO: European vs. National Interests Group 1: Benjamin Smith-Helman Abby Reudelsterz Group 2: Madeline Kriger Geoffrey Besnier

Class 13

Morgane Lerville

Debate: Global imbalances: The current account and exchange rates. Group 1: Crystal Kim Arkar Hein Rebecca Abers Group 2: Florentine Brossier Kate Cobb

Class 14

Debate: Financial Crises and the Recession of 2008 Group 1: Eric Sadler Ani Christianian Group 2: Olga Pototskaya Alexander Smith

Class 15

Debate: The Reform of the Welfare State Group 1: Hugo Lhuillier Katherine Branigan Group 2: Olga Tymouch Mary Kate Binecki

Class 16

Debate: China and the Other Emerging Powers. How to Deal with Globalization? Group 1: Benjamin Smith-Helman Crystal Kim Group 2: Oskar Melking Tracy Lin

Class 17

Lecture: The Future of Europe. General discussion and Q&A

Class 18

FINAL EXAM (December 12th)

Field Trips Bruxelles: October 1st and 2nd Luxembourg: November 19-20