Suchergebnisse

Following the Brexit vote, the European Union (EU) is experiencing a deep institutional crisis. The economic theory of federalism may explain the causes of this crisis and suggest ways to overcome it. The core of the problem is that the EU has taken action in areas where it would have been preferable to leave the initiative to the Member States and that it has neglected to act in fields where the central level enjoys a comparative advantage compared to lower levels of government. The paper presents the economic criteria that may be used to decide the appropriate level of decision-making in a (quasi) federal union. It argues that political distortions have inhibited the use of these arguments and have consequently led to the current institutional crisis. Both market integration and the monetary union have become a goal in itself and are no longer connected to the original ambition of the Treaty to increase social welfare and guarantee a peaceful coexistence between the Member States. This article suggests a deregulation of market integration legislation and a reform of the Euro system, which are in conformity with the basic lessons of the economics of federalism.

Several economic criteria may help policy-makers in choosing between public and private enforcement of competition law. The welfare losses caused by infringements of the cartel prohibition may be better internalized by imposing fines rather than by bringing damages actions. Public agencies may possess information advantages and they may also be able to remedy the difference between the private and social motive to sue. Private enforcement may complement public enforcement by increasing deterrence and guaranteeing compensation. Both direct and indirect buyers should be given standing to bring damages actions. Given the reluctance to introduce US-style class actions, European policy-makers favour collective opt-in actions and representative actions brought by consumer associations. However, the participation rate of opt-in collective actions may remain too low and actions by consumer associations are also vulnerable to principal-agent problems. Moreover, private enforcement of competition law by consumer associations will remain suboptimal if the funding problem is not solved. This paper argues in favour of an optimal mix of public and private enforcement of competition law and suggests some remedies to overcome the above mentioned problems.